I think Amazon is a great buy as well
I think Amazon is a great buy as well
LIFE IS ABOUT CHAMPIONSHIPS; I JUST REALIZED THIS. The MILWAUKEE BUCKS have won the same number of championships over the past 50 years as the Green Bay Packers. Ten years from now, who will have more championships, and who will be the fart in the wind ?
What are peeps buying these days? I just bought some PYPL and PLTR.
Originally Posted by call_me_ishmael
I think both of those are nice buys. About 18 months ago I bought NVDA, AMZN, and GOOG.
The latter two have did already, but NVDA has expoded.
I've actually been considering TSLA as well; what are your thoughts at this price point ?
I've been pondering adding to NVDA, AMZN, and GOOG also. Just wish I had more funds
LIFE IS ABOUT CHAMPIONSHIPS; I JUST REALIZED THIS. The MILWAUKEE BUCKS have won the same number of championships over the past 50 years as the Green Bay Packers. Ten years from now, who will have more championships, and who will be the fart in the wind ?
I bought 50% amazon, 50% palantir, sofi, and paypal. I am swinging for the home run right now in this crap economy.
I get ~40K of square stock on Monday. The question is should I keep or sell it.
I bought and still hold Square stock; I think it will be a winner long term
LIFE IS ABOUT CHAMPIONSHIPS; I JUST REALIZED THIS. The MILWAUKEE BUCKS have won the same number of championships over the past 50 years as the Green Bay Packers. Ten years from now, who will have more championships, and who will be the fart in the wind ?
They need to stop diluting the stock and get to profitable. Too much stock based compensation and shareholder dilution (I work there)
I have dumped a pretty good chunk into amazon as well. I lost initially and cost averaged down, now I'm up about 20%. I'm holding it for a while yet as I think $200-$250 is a slam dunk within 2-3 years. I'll probably issue calls for about 1/4 my position at $160 as I think tech is going to stagnate for the rest of the year. Those should expire worthless and let me pocket some cash, but if not I'll liquidate some stock at a nice profit.
A really good play is Lincoln National. Its an insurance company. At the risk of introducing politics, the massive spike in deaths of 18-45 year olds is subsiding. I opened a position at about $21 and wrote some put options for $19 that are about to expire (I kind of wanted to be forced to buy more at that price). I just see this as a rock paying a 7% dividend. I'm not saying its going up 50% or anything like that, but a stable 7% with some capital upside is where you should try to live.
There is a lot of value in the market right now, but I'm pretty much all in. I have to liquidate something to open new positions and I like everything I have right now.
I don't hold Grudges. It's counterproductive.
Out of curiousity Bobble, what tech stocks/high upside stocks do you really like at today's prices ?
Not to be boring, but I am thinking of adding to both AMZN and GOGGLE but I love researching new ideas/stocks as well
LIFE IS ABOUT CHAMPIONSHIPS; I JUST REALIZED THIS. The MILWAUKEE BUCKS have won the same number of championships over the past 50 years as the Green Bay Packers. Ten years from now, who will have more championships, and who will be the fart in the wind ?
I think a lot of tech has overcorrected.
Here are some that I like and why.
ZM - Zoom is used (and loved) by people all day every day. Their stock is down big time from covid, but there customer base is much larger. It's priced less than 2019 when folks didn't realize it'd become a verb and become the de facto web video conferencing tool. That said, I use Google meets at work and it's fine, so IDK about a moat, but you can't argue the fundamentals aren't sound.
PYPL - Very strong fundamentals. Crazy good PE ratio and PYPL has the money and authorization to buy back 20% of shares. Could buy more if it overcorrects more. I think there's a decent chance it 2-3x in the next 3-4 years. Paypal sounds old and clunky but they own a lot of smaller consumer brands that form a moat. This guy posts a lot of his trades and has been banging the drum on paypal and shares his reasoning why. I believe it makes sense. https://twitter.com/Micro2Macr0
PLTR - Growing space and I am proudly American so I support our AI defense company.
SOFI - Overcorrected and good funamentals now. I expect to see it climb significantly.
I am sort of out of the growth market. I hate paying for projected growth. I like Amazon more than the rest and its literally my only non dividend paying stock. Income/cash flow is king. No investor in history has proven adept at guessing which growth stocks will break through and outpace the market. And honestly even though I have a decent track record (I rode Apple for a nice run, ET when it was down at $4 up to $17 and others) It was always like 3% of my portfolio.
I have something like 47 stocks in my portfolio and they cover a lot of sectors. My average dividend for the entire portfolio is over 7% (partly because the base value of the stocks are down over the last 2 years).
I love stalwart MLPs like EPD and ET. They are cash cows that aren't going anywhere despite efforts to end big oil. Stable BDCs like OBDC and ARCC with monster dividends near 10%. My biggest single position is an actively managed preferred fund PFFA that has over a 10% dividend. And a couple really nice triple net lease plays VICI and O with growing rock solid 5% dividends. Oh, and USB (US Bank) is over 5% qualified dividend that tanked when that bank in CA went under. That kind of thing just shows the irrational nature of the market. USB doesn't have a risk manager that graduated in diversity studies. They aren't even wiggled by the things that caused that failure, yet the market sold off the entire financial sector.
If you want some good exposure to Tech/Growth I would probably just grab QQQ (nasdaq ETF). You will get the winners and losers alike, but the entire sector is growing. If you are not looking for income from your investments then it likely will outperform most other investments over the next 10 years. Oh....and Amazon. They are going through a renaissance of sorts and I think they are positioned like Apple was when people were wondering "what will they do now that everyone has an iPhone".
I don't hold Grudges. It's counterproductive.
I like your thesis on paypal. I even clicked the link, but his thread was all tesla. I made the mistake of shorting tesla once...only once. I still think the stock is more hype than not and ultimately its success won't be cars. I think elon is a cult of personality and those who love him pump up the price and I'm more fundamentals driven. I may research paypal a bit more, but catching a falling knife is dangerous.
I don't hold Grudges. It's counterproductive.
I will say this Ish. Be wary of a guy whose claim to fame is that he made his fortune on Tesla. Bottom line is he got lucky. Tesla's fundamentals have never been great. People bought momentum and others piled on. No way were they saavy investors. This person may have learned along the way, and once you have a pile of money, making more in the market isn't hard, but if you invest in every tesla that comes along you will lose money in the long run.
There is a reason "the motley fool" service STILL talks about nailing Amazon early on. Its because they haven't duplicated that "success". The greatest investors in history....Joel Greenblat, Warren Buffet, Benjamin Graham. They were all value investors. None of them laid their claim to predicting 10 baggers....probably because no one in history has done it consistently. Find stalwarts that the market is down on for no good reason that pay nice dividends. Buy and hold them until the market goes the other way. Wash, rinse, repeat.
I don't hold Grudges. It's counterproductive.
Oh...I should have added my favorite saying. Investing is the polar opposite of sex. Sex should be spontaneous, crazy and exciting. Investing should be well thought out, rational and boring. Boring is good. Be boring and rich. It beats exciting and poor.
I don't hold Grudges. It's counterproductive.
I totally agree. That's why I like and own the most of Paypal of the above. Here is a good analysis on Paypal. He's done a bunch of 'em.
I tend to avoid quacks and people trying to sell you soemthing. I do buy the narrative on paypal though because the fundamentals are so good.
https://twitter.com/Micro2Macr0/stat...75121286225978
I don't do options and day trade or anything like that. Frankly Paypal is a hedge on Square for me since I can't buy Stripe and can't legally hedge against Square directly.
I honestly don't like his write up at all. His main argument is "it used to sell for a lot more and I'm counting on a reversion to THAT price". Thats a bad argument for a stock that formerly traded at ridiculous valuations.
It may dominate its market. He could be right, but I want to see analyst projections (and current) EBITDAs and such. Actual hard metrics that back up a stock valuation. I'll post a write up from one of my favorite authors as an example and BOLD out some things you have to know to make a sound investment.
I don't hold Grudges. It's counterproductive.
Spirit Realty Capital (SRC) is a net lease REIT with a 7% yield and trading at a significant discount to fair value.
SRC's recent results have been positive, with boosted guidance for adjusted FFO per share.
The company has good diversification, long lease lengths, and strong tenant quality, making it an attractive investment option.
It's Spirit Realty (SRC). The REIT now yields a meaty 7%, while also trading at a significant upside to its historical valuation.
Let's see what this REIT can offer us at this time.
Spirit Realty Capital - Plenty to like about undervalued triple-net
Investment-grade REIT investing with a 7% well-covered yield is not possible in every market environment, but it seems positive in this one.
By well-covered, we mean that the FFO payout is less than 75% on a 2023E current basis, and that's including a one-percent FFO drop at this time.
The latest results from Spirit Realty Capital we currently have are the 2Q23 results - and these were of a positive nature.
How so?
A consensus-meeting set of results from August 8th isn't exactly perhaps the best explanation for why this REIT is such a superb "BUY" - but we really have to consider in context, just how good this is given the expectation of an FFO drop we had before this prior quarter.
This quarter, after all, caused SRC to boost guidance.
The company is now expecting 2023 adjusted FFO per share of $3.56-$3.62, compared with its previous guidance of 3.54-$3.60 and the $3.65 consensus.
(Source: Spirit Realty Capital Earnings, 2Q23)
This means that we might only go down less than a percent for the year - or perhaps not even at all, which of course would be excellent given the past few years of trends.
SRC is doing what most REITs are doing in this segment. Disposing of underperforming or non-core assets at preferably appealing cap rates, while investing in better assets to enhance its portfolio.
SRC IR
SRC IR (SRC IR)
The company's capital has been going more and more towards industrial properties since 2022, but entertainment retail is seeing a bit of a climb as well, as well as overall retail.
There's a significant fundamental quality to be had here when looking at SRC, as I've pointed out in the past. It has good diversification, with good tenants in its ABR. It has very little overexposure to any one area, which other REITs do not share in terms of quality.
The company also, unlike some of its peers, has an extensive average lease length, of over 10 years, which is very good in the context of net lease. The average size of an SRC asset is just above 100k sqft.
What was once rent collection issues during COVID-19 are now completely gone.
Rent payments are in full - and there are plenty of good tenants to like here. As of 2Q23, the ABR for the full year is nearly $700M from 2,064 properties that the company owns at a near-market leading occupancy rate of 99.8%. Out of that, over 86.5% of all tenants are at over $100M in revenues.
The company has, as such, very few "small players" in its portfolios, and these tenants hail from almost 40 industries and are almost 350 in number from 49 states in the US.
The one disadvantage we see to the company's rent base is continued exposure to Walgreens (WBA) well above where other REITs and other companies we look at an invest in are seeing exposure.
3.8% of the company's ABR comes from Walgreens, and given the state of the pharmacy, that's not something we particularly care for. We don't see a non-payment risk, but we do see a risk of the company needing to release these properties.
But aside from those, the remaining industries and tenant diversification are absolutely solid.
The company also very recently raised its quarterly dividend, in defiance of all those that seek to doubt it. Though before we cheer in joy from that, remember that the raise was only 1% - so it's more of a token raise than anything else.
Still, the company would not have done a token raise if the results weren't at least acceptable, and these 2Q23 results were anything but.
Spirit Realty is treated, on the market, as markedly different than some of its peers, most specifically Agree Realty (ADC) and Realty Income (O).
While the company does have key differences both in terms of size and in terms of safety, we argue that these differences are far from as significant as to justify what we're seeing on the market today.
The company has been growing its industrial asset portfolio.
This is part of the argument why SRC, going forward, might make even more sense to invest in than some of the other triple-nets, because many of these properties are newer, with better leases, and more mission-critical in their application than even some of the wholesale anchors and large stores/other properties the company otherwise operates.
Perhaps the second risk or disadvantage to SRC is the fact that only a small number of the tenants have CPI-related rent escalators, with most at over 77% at contractual escalations.
This might not sound bad, but keep in mind that most of these escalations were decided when we did not have the current inflation, meaning they're likely significantly below current CPI numbers.
Instead, point to the other positives - such as occupancy, which for several years has not dropped even slightly below 99%.
Instead, point to the company's credit safety - BBB rated, with no sign of declining. The company is still forecasted, at least by FactSet analysts, to deliver an FFO drop of around 0.9%.
If you believe that is enough why this company should trade at only 10-11x P/FFO, while peers trade at almost twice that, then we would say you're being too harsh on the company, despite a 3-year growth prospect of only 1% per year on average.
We believe the valuation coupled with what we're seeing here in terms of an overall lack of FFO decline makes the case for investing here.
Oh, we could see further drops - but that would just make it more appealing to invest here.
Let's look at the thesis for investing, and what you could make by investing in Spirit Realty today.
Spirits Valuation - a 15%+ Upside annually is very much possible.
So, as you know, we look for 15%+ annualized upsides - and they need to be conservative, not based on valuations the company has never seen before. When it comes to Spirit Realty, we see 9-13x P/FFO trends, which means we don't want to put it at the level of O or ADC.
Fortunately, we don't need to do that to get a 15% annualized upside.
All we need to do for that is to expect the company to trade at 12.5x P/FFO within 3 years. If it does that, the combined yield and reversal, despite almost no growth, will deliver that return here.
Is it likely?
That depends - we believe it is, as we believe the market will see a reversal.
But we could also see a deepening undervaluation in REIT space - even more than we already have. That would of course potentially see lower returns, or enable us to invest at even cheaper valuations, should we choose to do so.
In the end, though, we believe investors need a reminder of what SRC is. Namely, it has key exposure to most geographies we want, while avoiding or having lower exposure to geographies we may want to avoid.
That means it's not just a play on REIT space, it's also a play on urbanization, movements of people (as we're seeing), and demographics, all of which trend towards the favorable as things are looking now.
This momentary weakness in the space is nothing that causes us to hesitate. If anything, the current unfavorable FX we are personally exposed to causes us to hesitate more than any specific downturn in REIT space.
We last wrote about Spirit Realty was around 2 months back. And we were positive, and we bought more. We also set a price target at $40/share, and despite what we're seeing here, we’re not discounting or lowering the price target.
S&P Global analysts is forecasting the company even loftier targets than us. 15 analysts go from a low of $40/share to a high of $58/share, with an average for $44/share.
Despite the current share price, which is actually below the lowest possible PT, 11 analysts out of 15 have a "HOLD" rating at this time, a remarkable lack of conviction and clarity with respect to these targets.
We believe that the combined yield and upside are more than worth it, and SRC is very much worth consideration even in the context of the many opportunities available on the market today.
What we want to make sure of is that if you consider this, you consider diversifying into a number of investments with a 15%+ annualized upside - diversification.
Risk reduction is what we’re looking for at this time, and as much as ADC and O investments are part of this, our SRC position is part of this as well.
Spirit Realty offers some of the best companies out there, some of the most recession-resistant businesses, and space that's been leased on average for over a decade into the future. Even in the case of a slight FFO decline, this portfolio is more than likely to continue outperforming.
We expect REITs, especially triple-net and net lease REITs to bounce back at the end of the rate hike cycle. While we can argue back and forth about where in the cycle we are, we would say it's likely that we're closer to the end than to the beginning.
The key is finding the REITs that drive shareholder value due to lower cost of capital, better growth, and higher portfolio quality. It's our firm conviction that SRC is one such REIT, and we both back this up by investing in it.
I don't hold Grudges. It's counterproductive.
I cleaned it up a bit and highlighted important points. Points anyone should be making if they are pimping a stock. SRC has been crushed along with the entire triple net lease sector by rising rates. Personally i think we are closer to the end of rising rates than the beginning. A stable 7% yield is awesome on a stock of this nature. The author explains WHY the share price should revert to minimum of 12.5x AFFO. I edited out parts about it being a takeover target, but its also relevant. I am always thrilled to collect a 7% payout to wait for a stock to increase as long as I have good reason to believe it will.
The Twitter dude you linked to gives you nothing. He thinks the company has a lot of "other things" going for it, but doesn't mention any of them. He may be right, but I have no clue other than to blindly follow him or do a bunch of time consuming research on my own. (I do at times). Most of this SRC information is from public data. The author put it all together neatly for me. imo his case is nearly indisputable. SRC will increase in price eventually (and I don't have a crystal ball), but in the meantime I'll take 7% and either reinvest it or buy my wife something nice.
I don't hold Grudges. It's counterproductive.
That's one of many posts, but he does call out how fundamentally sound it is. They have obscene free cash flow. I just picked the first long post I could find from him. He has some bangers.
Did some reading on paypal. I still won't be investing in it as it pays no dividend. Some important metrics dropped by 10% last year and the stock dumped about 50% of its value. Thats amount looks right if you think the company is broken, but I agree that its not. If I'm guessing the next year could go anywhere from sideways to +50% just based on what I saw. I just think there are a ton of investments available with similar upside and a 7%+ dividend while you wait.
I don't hold Grudges. It's counterproductive.
What are some of the symbols, I like to roll the dice.
In general I am opposed to stocks that pay large dividends because it means they don't have any ideas (growth) for their capital. BUT for the right price I could get down on it.
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