Category Archives: $Z

2CentView performance in 2016

The 2CentView portfolio was up 12% in 2016, which outperformed the S&P500 by 3% but below the FTSE100 which returned 14%.

The objective of the 2CentView system is to outperform the index in rising markets and be at least in line when the major index is flat or falls up to 20%, and outperform if the market corrects more than 20%. The portfolio is benchmarked vs. the SP500 (50%, up 9.5% ) and FTSE100(50%, up 14%), so the outperformed by 0,75% in 2016.

Overall return since 2013, 86% (21.5% annually).

2016 was a volatile and difficult investing year, starting with a sell off in February, triggered by low oil prices and a distressed energy sector. This was followed by Brexit and the election of Donald Trump – both results proving the polls are meaninigless! Many pundits advocating ‘sell all’ following both of these events, but the key was NOT too panic, and look at these events as potential buying opportunities – quality companies will always do well no matter who is in power!

Where it did badly:
2 Core positions were savaged – $FIT (FitBit), $SPWR (SunPower) – both these core positions were down 30% following results, so they traded way through long term stops – 2Centview eventually did exit – the overall pain was not great as 2CentView always sells higher up to reduce the overall cost basis and protect you from the ‘wide arcs’, as the legendary investor Bill Miller says

“Stocks, markets, and money managers’ performance are subject to enantiodromia, the tendency of things to swing to their opposites. Those swings can have wide arcs, and unsustainable trends can sometimes persist beyond the ability of one to endure. That is why most investors are out of stocks at the bottom–they are tired of losing money–and fully invested at the top–they believe their good performance will persist despite their stocks or the market’s being overpriced.”

Trades in $SPD (Sports Direct), $EZJ(EasyJet) [ post Brexit trades],$SKX (Skechers), $VRX (Valeant) were all stopped out.

Where it did well:

Core positions which did well: $MS up 60%, $Z (Zillow group), $ACA (Acacia Mining – gold trade) up 109% were the best performers with other core positions in Apple, FaceBook, Celgene, DLG up between 5 and 15%.

Trades that did well : $LNKD (linked in) – bought by $MSFT, $BOO – boohoo.com (bought after sell off following Trump victory). $DVN – Devon energy  doubled.

Also taken a position in AK Steel and IAG following Trump Election (up 30% and 5% respectively).

The portfolio benefited a bit from the rally in the US$, but the currency exposure is broadly hedged using the $PUS contract.

Main lesson learnt from 2016 – DO NOT PANIC – exiting the market was the worst possible thing you could have done in 2016 – but STICK to your stops if the market or an individual position continues on a downward spiral (both $SPWR and $FIT $9 exit stops were hit).

2CentView is that 2017 could be a great opportunity to make 15-20% if Trump delivers on his election promise, tax cuts and infra-structure spending could really boost company earnings. More on the next tweet for themes for 2017.

Happy 2017  from the 2CentView team.

$Z (Zillow) – taking some profit after amazing run up reports…

Took a position about a year in Zillow – the ‘RightMove’ of the US.

Taking some profit here ahead of the results on Thursday, as the stock approaches the Target (post-split target = 43, current px = 39.5)

It has a great run, the pains of integrating Trulia seem to be over.

Keeping a core position – think Zillow does have the potential to be 30bn+ Company over the longer term.

Keep going Spencer!

$GNW(Genworth) – recovery story turns sour….$Z and $FIT both down 10% post results

Genworth stock crashing after results – after good Q1 where the recovery seemed on track, it has never recovered following a Morgan Stanley downgrade.

Zillow and Fitbit both getting crushed even after good quarters.

Market is tough at the moment, stick to stops and stay on the sidelines, long CASH!
China story may not be over.

Commodities getting crushed.

2CentView – stopped out of $GNW and $AA. Still in $Z and $FIT (FitBit).

Took a position in $Z (Zillow) the RightMove of the United States…. Here is why…

Zillow is a Property Search website based in the the United States – similar to RightMove.
Been keeping an eye on Zillow for some time – this time last year it was at $160!

So why is it much lower now?

– they bought Trulia – the other main competitor in the Space and the integration has not been easy
– their CFO Resigned recently

Here is why I took a position:

– the Market cap of 4.1Bill is low compared to the opportunity now they dominate the market
– RighMove 2018 revenue is projected to be around $350mm in 2 years time, as the US is 5x the size of the UK, this means Zillow’s revenues could be as high as $1.8billion
– this equates to EPS potential of nearly $500mm – much higher than currently projected
– Apply a 15x multiple Zillow market cap could be as much $7,5bn – so stock could be worth as much as $135
– Spencer Rascoff is a top young CEO

Suggested trade: Buy here at $84, Target $130, Stop $63.

2CentView is in the above trade Size: 2.5% of the portfolio.

NASDAQ Closes above 5k! Bail out or Buy more? 2CentView …….

Can the NASDAQ power on from here or is this Y2K all over again?

$CSCO traded on a p/e of 100x in 2000 and there was talk it could become the first trillion $ company. Today, it has a market cap of 145bn a p/e of 13 and a growth rate of just 5% over 5 years – so not exactly the same as Y2K.
The Biotech sector is showing some signs of a bubble brewing up – but this is still not on the scale of bubble in 2000.

Mobile Social and BioTech stocks have done well over the past 18 months – PC related stocks have performed poorly – and will probably remain that way as there is no growth in PC – look at $INTC and $HPQ recently…

There are very few bargains left in these hot sectors – the last one $SWKS (Skyworks) which was an incredibly cheap stock at $60 when 2CentView tweeted the name back in November 2014, is now $102!

Value names in various Sectors:

PC’s
Keep away from PC Stocks for now – if you do want to buy, $MU is the cheapest.
$MU FV = 38
$HPQ FV = 35 Yield 2%
$INTC FV = 29 Yield 3%

Mobile/Social/Internet of things/Wearables
$GOOG FV=600 – was a great opportunity to buy when below $510
$MSFT FV= 45 – if you think they can move out of their depdendence on the PC
$CSCO FV=30 – buy some for the yield of 3% and potential in the internet of things – implied growth still very low

Internet Software and Services
$BABA FV=120 – includes $20 cash – implied growth 25% vs 45% on $AMZN
$Z FV=108 – Spencer RasCoff is a great young CEO
$YELP FV=70

Biotech/Pharma
$GILD FV = 109 also pays dividend! HepC is competition is heating up though!
$JAZZ FV=189 – could be the next pharma take out!

Solar
$CSIQ FV=60 [see earlier tweet on this name ]

2CentView has core positions in $AAPL, $GOOG, $FB [3 best tech companies in the world!], also $TWTR, $ISIS, $CELG , $GILD and $FEYE

2CentView FVs are calculated using a proprietary earnings based model which has been calibrated to determine a fair vlue stock price today. It is based on consensus analyst predictions of future earnings – these are predictions only and may not play out in the real world. It is designed to identify mispricing between the stock price and future earnings potential of the company. The model has helped 2CentView realise a 35% annual gain over the past 2 years.