The Roku Story: How Far Can It Go?

  • Roku is a “platform for television distribution”, focused on hardware creation, content distribution, and advertising services.
  • The company trades at a high valuation, especially compared to their tech peers.
  • They are issuing an additional 1M shares of stock that they plan to use toward working capital and general corporate purposes.
  • Roku is focused on making TV better, specifically by building a TV-specific operating system.
  • The space they are in is fiercely competitive.

Roku: Not A Hardware Company

Roku is a technology company that specializes in streaming devices, advertising, content distribution and creation. The company had 29.1M active accounts as of Q1 2019, with users streaming over 9.8B hours in the first quarter alone on the platform. The average Roku user is up to 3.5 hours a day in terms of platform engagement.

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Green Dot: The Drop Is The Perfect Time To Buy

  • GDOT is a leading company in the fintech space, offering both account services and a unique banking platform.
  • They got hammered after their Q1 2019 earnings release, and their share price has dropped 30%.
  • Green Dot is accelerating potential growth prospects by investing heavily into their Banking as a Service platform and marketing opportunities.
  • The company is potentially undervalued due to market overreaction and DCF calculations.

Green Dot: A New Kind of Bank

Green Dot Corporation is a true financial technology company, offering bank holding services for consumers, as well as a banking platform for various companies. They’re known as the inventor of the prepaid debit card and are the largest provider of reloadable prepaid debit cards and cash reload processing services. They are also the largest processor of tax refund disbursements in the US through TPG, and a leading provider of mobile banking through GoBank.

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Uber: The IPO Underperformance is a Good Thing

  • Investors are paying a premium for disruption when they invest in Uber
  • The decline in value after the IPO means the company has left no money on the table
  • Uber is betting on a vision of the future, with focus on shared and on-demand services
  • Uber labels themselves as a “personal mobility business” in an attempt to create a big market story and it will pay off
  • There are ways to get exposure to Uber without investing directly in Uber stock.

Everyone has their own opinion on Uber and the other 2019 IPOs. Lyft went public back in late March, and the stock has plummeted 46.5% from all-time highs. Uber went public at $45 per share on May 9th at a market cap of $75.5B, which was far below the initial $120B prior valuation.

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Diving into 5G: The Future of Network Connectivity

  • Verizon has received a lot of attention in the news for being the “first” company to launch 5G services
  • There are headwinds to 5G, including a lack of devices to support the network
  • The 5G business isn’t expected to have much of an impact until 2021
  • The 5G discussion is complex and convoluted and no one really knows what’s happening
  • China is an industry leader, due to government support, and the US has a steep learning curve in adapting 5G nationwide

Diving into 5G: The Future of Network Connectivity

5G is a game-changing proposition for the communication services industry. People are demanding faster and faster network speeds, and 5G offers a combination of that speed, as well as “capacity, reliability, and ultra-low latency required for mission critical services and the growth of massive IoT.” 5G surrounds the idea of connecting devices and creating smart cities with applications to healthcare, retail, and utilities among others

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Costco: Everything is Right Except the Share Price

  • Costco’s supply chain management is all about “minimizing the fingerprints” which makes them one of the most efficient operators in the business.
  • Costco has an online delivery platform that offers free shipping to customers if their orders are $75+.
  • They have several overseas opportunities, and are continuously expanding abroad.
  • Costco has one of the best supply chain management systems in the grocery industry.
  • They are currently trading at a 52-week high, and based on many valuations, they are overvalued.

The Retail Industry is in Shambles

It is no secret that retail is struggling. Consumer sentiment and consumer credit are at all-time highs, but retail still lags. A lot of companies have attempted to remake themselves, but cannot seem to get back on their feet. JC Penney had an extreme makeover, but the company is still floundering. Sears is a lost cause. Toys R Us is gone.

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The Boeing Company: Keeping it Plane Simple

  • Boeing has been one of the “Darlings of the Dow” for a long time
  • The company has a lot of growth opportunities, both in the commercial plane space and the defense industry
  • The stock price has almost doubled over the past year, and the company actively buys back shares and pays out strong dividends
  • The space has several key players, but Boeing is continuing to gain ground on most of the competition
  • Geopolitical tensions could weigh down the company’s performance over time

On February 19th, 1982, the Boeing 757 flew for the first time. 37 years later, on February 19th, 2019, the company’s 787 hit 801 MPH, supported by a jet stream that pushed it to record-breaking speeds, helping it to move faster than the speed of sound. For comparison, the ordinary cruising speed is 561 MPH.

Boeing always seems to be going full-throttle ahead, 250 MPH faster than everyone else. They have been a force to be reckoned with for a long time, both in terms of innovation and market performance. The stock returned 11.5% over a very dismal 2018, and has already returned 30.3% YTD for 2019. It has provided key support to the Dow Jones Industrial Average index, serving as both a market and industry leader.

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Microsoft: Reaching for Infinity and Beyond

  • MSFT is an industry leader in software services, and has been a strong company for many years
  • They are allocating a large amount of resources to their cloud segment
  • The industry as a whole is constantly evolving, but could be prone to a slowdown if the economy contracts

Microsoft is one of the most well-known companies in the entire world. In a perpetual race against Apple and Amazon for “Most Valuable Company”, Microsoft has been able to make a name for themselves over the past 44 years based on their product line and their openness to growth and innovation.

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Running Out of Gas: The Direction of the Auto Industry

  • The auto industry is showing signs of weakness, through compressed sales figures and job losses
  • Automakers didn’t pay enough attention to consumer demand for SUVs, and they have to be careful not to repeat that error with electric vehicles
  • There are several things disrupting the industry, such as autonomous vehicles, ride-sharing, and Tesla

The auto industry always seems to be a predictive measure of weakness in the economy. If auto sales fall, we can use that to project consumer spending, which represents 2/3rds of the overall economy.  However, auto stocks have moved downward the past year, despite ideal economic conditions. There has been a slump in sales figures, even with a boost from fleet sales, especially across American automakers. There are several reasons for this decline, including quantitative tightening, job losses, heightened competition, weakness overseas, and the trade war.

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The Power Of Monopoly: PG&E’s Plan To Keep The Lights On

  • PG&E is currently under investigation for their potential involvement in several wildfires, including the costliest one of 2018.
  • The company cannot afford the liabilities from the fires and are in talks of declaring bankruptcy.
  • PG&E got their rating cut to junk by S&P, and are under examination by the other rating agencies.
  • The company is 84% institutionally owned, and several of the top hedge funds have increased their stake.

News about PG&E has been almost impossible to avoid recently. They are under investigation for their role in several wildfires throughout California, most notably the Camp Fire, which resulted in 86 deaths and was the costliest natural disaster of 2018. For all of the fires, PG&E could face liabilities that total a minimum of $30 billion.

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