PIMPING STOCKS

[call_me_ishmael]

Good thread on paypal.

https://twitter.com/aletechview/status/1695593356770836754

[bobblehead]

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.

REITs, BDCs and others are required by law to pay dividends. If a company can't pay you, why own it? Income/cash flow is king. Now, sometimes it does mean exactly that. In those cases (big tobacco) the dividends are very rich. 8% plus. I'm over 50, so I like income. I don't want to liquidate shares when I need cash.

Some symbols. SRC, LNC, ET, HASI, CCI, HIW, CTO. Thats a handful that i own. They all come with varying risk profiles. They all pay fat dividends that are pretty damn secure. They all have pretty good upside when the market decides to move forward (when the feds stop hiking most likely).

[bobblehead]

Stable 10% yields could include PFFA, BXSL, OBDC. These have much less upside generally speaking, but are very nice investments to provide cash flow.

[Bretsky]

In past month I

picked up some more AMZN shares
Picked up some PLTR and PYPL and added to SOFI
Picked up some SNOW....aka Snowflake

Dumped PLUG about break even; cashed out a small portion of QCOM and DDOG shares. I still like those tow but wanted to move some money around

[bobblehead]

Been doing a little more research on Paypal. I'm liking it more to be honest. They have a massive 5B free cash flow annually. Ish, you said you don't like the dividend because it means they have no growth opportunities. Paypal is the epitome of a stock that should be paying a dividend. They are doing some buybacks (which is still returning cash flow to investors), but they don't have a mountain of growth opportunities. They certainly seem to be undervalued, but here is the sticky part for me. They DON'T pay us to wait. They aren't growing significantly. What happens if they get mired in a 7 year bear market (and yes, that certainly does happen).

Now take an investment like O. Financial Realty pays over a 5% dividend. Has similar growth profile (a tad better probably) than Paypal. Is undervalued by roughly 25%. I can collect "rent" while I wait, even if that takes 7 years. They also continually increase that dividend. So maybe Paypal bounces 40% instead of the 25% of O. Then it just depends on how long it takes. This is one big reason I really prefer stocks to pay dividends.

Now, if the growth profile is massive (Amazon) I can make exceptions. But the older you get the more you should demand dividends. And in the case of a Paypal which hemorrhages cash, they really need to institute a dividend. If they did, the stock would likely take off.

[call_me_ishmael]

They use their cash to buy competitors and build their moat. I really like the stock fundamentals right now. IMO, it overcorrected and will go up to like 120 in a few years assuming we don't have bad recession.

I agree on the dividend piece as you get older. I do the safer stock thing with my 401K. This is fun swinging-for-the-fence play money.

[call_me_ishmael]

Bobble what do you think of SQ from the outside? I am torn on selling on vest vs holding. My stock grant is at 67 a share so I am down about 10% right now, but I would be okay with that if I didn't think there was a reasonable chance that Square improves fundamentals and goes up 20-30% in the next couple years. I don't really need the money so no need to sell right now. I am also presently holding as a hedge against getting laid off. If SQ does a layoff that impacts me, the stock will shoot up 20% probably so I am offset lost wages that way.

[bobblehead]

They use their cash to buy competitors and build their moat. I really like the stock fundamentals right now. IMO, it overcorrected and will go up to like 120 in a few years assuming we don't have bad recession.

I agree on the dividend piece as you get older. I do the safer stock thing with my 401K. This is fun swinging-for-the-fence play money.

I stumbled across this in my readings. I thought you might find it interesting.

[bobblehead]

Bobble what do you think of SQ from the outside? I am torn on selling on vest vs holding. My stock grant is at 67 a share so I am down about 10% right now, but I would be okay with that if I didn't think there was a reasonable chance that Square improves fundamentals and goes up 20-30% in the next couple years. I don't really need the money so no need to sell right now. I am also presently holding as a hedge against getting laid off. If SQ does a layoff that impacts me, the stock will shoot up 20% probably so I am offset lost wages that way.

Hard to say with such a small player. You SHOULD have way better insight than anything I can come up with since you are on the inside (if you can be unbiased). Do you see anything to make you think that a small company can overcome headwinds placed in front of it by large competitors? Some proprietary advantage? I simply don't invest in any company that small. I also don't have enough idea of what they are all about to have a clue if they are a buyout candidate. My advice to you would go like this. If the stock option is worth less than 3% of your net worth you should hold it IF you believe the company will become a player or be bought out. If its more than 3% then I think you should liquidate down to 3% no matter what then return to my first option. I just think there are so many safe options that will almost (depending on overall economy and market) certainly get you 30% + over the next few years that I wouldn't tie up capital in such a small and risky company.

[bobblehead]

Thought I would revisit this thread. So, outside of Amazon (which we all agreed on) everything else has sold off with the market since I joined in. SRC is being bought out by O so its actually outperformed as well (the one I put the big write up in and noted I left out the part about it being a takeover target).

The stocks that pay the really big dividends but don't grow much have done exactly that. (the BDCs and Preferred fund).

I'm still mega bullish on Amazon and its over 5% of my portfolio and my only non dividend stock. I have made a little cash off of $140 options and currently have Nov 17th $160s I hope expire (but hopefully get CLOSE to exercising). Some of my faves like LNC have not improved. USB has moved mostly sideways. I didn't mention TFC which I got bullish on and opened a position in right after we died down. Its done well and pays a 7+ dividend.

[call_me_ishmael]

A lot of my growth stocks are doing really well right now. Who knows if it will continue. I just sold 100K of SQ because I am up ~10% on it and I want to take some risk off the table. We are in the market for a house so going to move it to my 5% wealthfront account. I HATE doing that right now SO much. But I absolutely refuse to get F'd and get stuck with a 7-8% mortgage.

[call_me_ishmael]

Jeff Bezos is obviously on TRT but he's gotta be on some other stuff too. His voice is an octave lower now than it was during his many, many, many previous interviews. He was on Lex Fridman the other day. Pretty interesting stuff.

[bobblehead]

Thought I would revisit this thread. So, outside of Amazon (which we all agreed on) everything else has sold off with the market since I joined in. SRC is being bought out by O so its actually outperformed as well (the one I put the big write up in and noted I left out the part about it being a takeover target).

The stocks that pay the really big dividends but don't grow much have done exactly that. (the BDCs and Preferred fund).

I'm still mega bullish on Amazon and its over 5% of my portfolio and my only non dividend stock. I have made a little cash off of $140 options and currently have Nov 17th $160s I hope expire (but hopefully get CLOSE to exercising). Some of my faves like LNC have not improved. USB has moved mostly sideways. I didn't mention TFC which I got bullish on and opened a position in right after we died down. Its done well and pays a 7+ dividend.

Since this, TFC is up about 30%, LNC 15%, USB 30%. Overall my portfolio popped over 10% not including the dividends I draw. It would have gone up more, but I have about 40% of the portfolio in income generation stocks that don't sink or rally as hard.

[call_me_ishmael]

Why is TFC down so much from 2019? Long way to go back up still. ~60% movement to get back to mid-50s where it was in 2019.

The 30K I bought in COIN about 18 months ago turned into like ~120K awfully quick. Nice!

My current stock holdings remain:

FB, AAPL, AMZN, NVDA, TSLA, SOFI, PLTR, PYPL, SQ, HOOD. Probably a couple small holdings too. I think AAPL is likely overvalued, NVDA too. NVDA likely has some more growth for a year or so, but then I expect it to come back to earth. Everything else is a major growth play for me and I feel very good about them all going way up as long as we don't go into recession. I am fairly convinced there isn't a recession imminent.

I am thinking about buying a large position of AMD. I have a long thesis on this if anyone is interested. But the tl;dr is the reason NVDA is dominant right now is two fold: A) AI is everywhere, and B) they're the only game in town in CUDA. Every major AI player is trying to break CUDA, and the second they do all the other chip makers will pop. AMD will be the main beneficiary IMO.

[Freak Out]

Nvidia is going to rake it in bro.