2019 Year In Review - Mask On...Mask Off

Thank you Future - Mask On...Mask Off. Represent...I Gotta Represent

Mask Off - I am currently closing the books for 2019 and reflecting on a year of ups and downs.  Personally, I was rocked to my core this year as I lost my father. It was a deafening experience because he was an amazing father, husband, educator, community and spiritual leader. When it happened, many of us were stunned, discombobulated and grasping for balance.  

I use the word numb because I arguably experienced my best personal year I have ever had…and didn’t care.  I was very fortunate from a very early age my father taught me how to be strong, independent, and prepared to lead the family when that time came. So that is what I – what we all have tried to do, with him in mind.  Finally, this year marked my second daughter and 3 nephews being introduced to the world and my family and they are a big source of joy as we recover from our loss. 

Mask On - I get my strength from my family and push on to make a difference in this short life we are given.  I keep my eye on the prize and financial independence, being spiritually guided, and mentally woke is a powerful combination that NOBODY can touch.  So mask on and back to the lecture at hand: I ran the numbers and I turned in a pretty solid year. At roughly 23%, my personal portfolio that I manage did fairly well and IMO I didn't take on a ton of risk as I targeted value stocks.  Some are discarded gems, others I did detailed research and just saw a different story and narrative than many others.  I kind of like going against the grain...following the herd is NOT in my DNA ask Kendrick Lamar. .

Remember you all can do this. Need proof, the broader market turned in a similar performance and an event better performance was found in a technology based strategy like simply buying the NASDAQ index this year (to the tune of roughly 35% this year). I've got big goals this upcoming year and I will introduce them later but here are the remainder of the best picks I uncovered for 2019:

• Symantec / NortonLifeLock (SYMC)- Value Play; Part of the Business was bought out gave us a nice pop 
• Telsa (TLSA) - Value Play Doubled in 2019 
• Sprint (S) - Played options very well (now letting the profits ride on T-Mobile deal approval will be biggest gain if hits)
• Okta (Okta) - Cybersecurity trade that I sold too early but you live and learn
• Allergan (AGN) - A beaten down value play that finally payed off; This company make BOTOX and will be bought out by Abbvie
• Arconic (ARNC) - Pickup up some shares about the $19-21 range; value play that was dogged by litigation from a high-rise fire in London; Sold to early but it's all good
• Humana (HUM) - This stock ran up after a few big issues failed to damper healthcare stocks: 1) the Trump administration came down lightly on fines for not disclosing their negotiated rates ( a supposed game changer to bring down drug prices) and 2) Elizabeth Warren scaling back her Medicare for all plans
• Red Robin Gourmet Burgers (RRGB) - Pleasant Surprise; Stumbled on to an under performing value stock that is under pressure to change CEOs and deliver better results
• Cronos (CRON) - Surprised to see this one was so profitable; traded the Marijuana stock a few times. I have big hopes and so does the alcoholic beverage industry as they took a major stake in this company. One of the few companies I still hold a stake in
• CrowdStrike (CRWD) - Cybersecurity IPO stock that focuses on protecting your devices; They got absolutely crushed after a bag earnings and I was nimble and played this stock very well. I will be back in CrowdStrike this year
• JD. COM (JD) - My patience was rewarded; I calculated that America and China need each other. Trump removing the China tariffs caused this stock to take off from the mid 20s and now its in the mid 30s. This is a core holding for the future 

I want to wish you a very Happy New Years. Many blessings to you all and don't be afraid to dream but do it rationally, help others, take prudent risk, and take care of those who are good to you.

Here is my gift to you the rest of the best:

• VIX Index - I traded in and out of the VIXY; I'm waiting for volatility to return in 2020
• Zscaler - Plagued by earning's misses; I traded ZS in 2019 and expect to be more active in ZS and the Cyber stocks in 2020 as expectations and acquisitions are ripe for the picking
• Kohls - Between dividends and a small profitable trade, Kohls made my list but then turned into my achilles heel; I fell for their splashy venture with Amazon which was probably to cover for a bad earnings call to come. They got crushed and will need to bounce back  
• Century Link - No big notes here. They stabilized around the $10 range and it was a nice win
• Ceasar's - A good example winning and lose. I bet on Ceasars in 2018. Was happy when a deal was announced and thought I won big. No deal came and my trade blew up. I put the trade back on and benefited when El Dorado decided to buy Ceasars...so only a small gain comes from all this work.
• AVEO Pharmaceuticals - I had a small win but AVEO continues to have disappointing drug trials  
• RedHat - bought out by IBM wish I had a bigger position
• Novagold - Gold is back and being helped by Brexit and the recent attacks in the Mid East
• Anadarko - Bought out by Occidental Petroleum; I beat my buddy Buffet to this trade as he funded Occidental's purchase
• Facebook - Hard to fight the beast. They known everything and are selling it...ohh marketing it to anyone with cash
• Foot Locker - Hurt by the China issues, severely under-performed but Nike's resurgence may bode well for them in 2020
• Newell Brands - A value play that I think has bottomed. Let's see if we can trade this stock on the way up 

Clearly 2019's song of the year is HOT by Young Thug featuring Gunna and Travis Scott...

 my job is to keep it HOT in 2020...look out

Okta - Cloud Security to the Rescue

Okta, Inc.

Ticker: Nasdaq (OKTA)

Industry: Internet – Cloud

Okta is the 4^th best investment I had for 2019. I say this with a pained look on my face because it would have EASILY been my best pick of the year.  Why do I say this – well Okta is like the relationship that was going great but simply ended to early.  If I would have held onto my shares Okta would have been in my Double Trouble club this year. To my knowledge the only other stock that was in this club is Tesla and that is because of its recent surge above $400 (Tesla, became a value play on my radar as it dropped into the low $200s)

To aide in my discussion on Okta, I want to talk about the Cloud and Cybersecurity. This is a space that I should know a little bit about since my primary hustle is helping Fortune 500 companies manage complex risk scenarios and a few of my focus areas are: IT and Cybersecurity. To stay compliant for my two professional certifications that I hold in this space, I am currently studying a few topics to receive educational credits.  I pulled up a series of articles from 2010 that I was going to be quizzed on and one article was providing an overview of disruptive technology that was going to change the IT landscape. This technology was the: CLOUD.  My first thought was I wish I had read this earlier and created the technology for my next investment. But the article pointed out the biggest risk to the move to the CLOUD. It made me think of this year's 4th best investment:

Okta addresses a major security problem caused by the increase of cloud based apps.  If your app is available on the internet conceivably anyone could try to access and steal important information.  Okta (a cloud access security broker) and other identify management platforms solving this problem are going to continue to do very well as companies look to restrict their crown jewels.

Okta traded in Q4 2018 around the $60 dollar range so I picked up one of my largest positions ever. However, I got a little nervous holding such a large position that when it appreciated in a few months to about the $75-80 range I removed the position.  Well, Okta now trades for roughly $120 dollars and it’s safe to say I did well but would have had a story for the ages if I would have just held on to this as a core position.  I guess you live and learn. 

For a detailed summary of the Cloud, click hear to read on:

Sprint, How A Wireless Carrier Was a Top 2019 Investment?

First things first, happy holidays to everyone out there! Next in my series of Top 2019 investments is Sprint.

Sprint Corp
Ticker: S (NYSE) Industry: Wireless Telecommunications

I have written about Sprint quite a few times so I am not going to spend much time on this investment. Sprint finally turned into an investment literally about one year ago. This was a tough decision because after doing some research on Sprint I felt like they operated more like the Cleveland Browns football team.  If you are not familiar with the Browns, they have not been a very good sports team in quite a long time. But there has been hope in the last few years as they have selected some talented players who are hoping to turn the franchise around (Mayfield, Garrett, Landry, Beckham, etc.). I was NOT a believer but many people anointed them a championship caliber team this year.  How has it gone this year for the Browns and their new look team?  Well in short, it is still dysfunctional and a work in progress.

I am already reading your mind -- and you are wondering if Sprint is similar to the Cleveland Browns, why in the world would I want to invest in them?  Well the nice think about the stock market is you can make bets on the underdog in hopes they can turn it around for a big upside. So using my Cleveland Browns analogy, I would have reminded Browns fans that I DON'T think this is the breakout year but I DO think they are headed in the right direction. As for Sprint, they, as well as the whole industry, will be looking good in future years due to the transition to 5G technology. T-Mobile appeared to like this future outlook as they made a bid to acquire Sprint which initially caused the shares to spike in 2019.  I was handsomely rewarded in 2019 on various bets I placed on Sprint and closed but was also surprised to see the T-Mobile deal still remained open.  Even though Sprint and T-Mobile squeezed through Federal regulator approval in 2019, the deal is hung up because roughly 13 states and D.C. think the combination would be bad for consumers and pricing.  I actually agree with the states argument that if there are only 3 major carriers (ATT, Verizon, T-Mobile) the aggressive pricing decline we've all benefited from probably slows down. So Sprint strangely is making the argument that they are on a path to go out of business.

Hope all you Sprint customers are listening, In short, here is what I've learned about Sprint:
a) they never did a great job with the Nextel Communications acquisition (remember push to talk Nextel, yeah Sprint ran that into the ground)

b) they made a major bet on which 4G technology would win and lost (Sprint WIMAX was shut down)

c) these events have caused them NOT to invest as much into their wireless infrastructure (not a good statement if that is one of your biggest responsibilities is to invest so cell phones work properly)

d) they own Boost Mobile and spent more time trying to convert pre-paid customers into customers like you and me who get a monthly bill and can get billed for overages (not really stealing customers from the other carriers)

Final Summary -- So even though I empathize with the states, it would look bad if the Sprint deal falls apart only to have that company FAIL in a few years. That also would result in the industry consolidating to 3 major players and the same concerns return over customer pricing. I've made a small bet once again on Sprint that this deals get done in the New Year.

TESLA - MY BEAUTIFUL DARK TWISTED INVESTMENT

TESLA #2 IN 2019

Kanye West's "My Beautiful Dark Twisted Fantasy" was named the album of the decade. And being a hip hop head I struggled with this designation until I recently revisited the album. Why did I hesitate to recognize the greatness of this album?  Well considering Mainstream Media gave this designation without consulting me...I did consider the source at some point they missed the target (Kendrick Lamar gets a strong nod for the crown). I think it is because of how polarizing Kanye West has become. It's hard to discuss him without someone having a strong opinion so I've drifted away from his music.  

How does this tie into my blog, investments, and my 2nd best performing stock of 2019 (Note: Symantec's last minute run pushed Tesla out of the #1 spot). Simple, Elon Musk and Tesla remind me of Kanye West.  Elon is one of the most polarizing people on the planet and his technology for a gas guzzling American culture is NOT far behind. I drive a plug-hybrid SUV (600+ miles per fill up) and I think my Midwestern state is purposefully taxing me extra for putting a fuel efficient car on the road through an electric vehicle tax I paid to register the car. Like Kanye, if you get caught up in Elon's antics you forget the greatness of his mind.

This year in March, I witnessed a polarizing discussion around Elon Musk tweeting about Tesla. I had not followed the stock much because it usually trades in a nose-bleed range of $300 to $400 dollars for one share of stock.  The SEC and Musk were going back and forth in the news about how his tweets could impact the stock and Musk was not shy is his feelings about the SEC.  

March 19 2019 - I believe the SEC held Elon in contempt for not having the company pre-approve tweets that could materially move the stock. I know it sounds childish, like Kanye taking the mic from Taylor swift, but this was somewhat serious and putting pressure on the stock. I decided to stake a claim on the side of genius because at the end of the day the electrification of cars is pure genius and actually is a business that can make help improve our planet.

April 2019 - Around the end of April, I have 25th in my notes Tesla was having an annual shareholder's meeting. I had my if it wasn't broke don't fix it moment and invested again. Elon discussed that the issue plaguing Tesla isn't a demand issue (the Media and Analysts were saying demand was waning for Tesla's). In fact, he said noted that orders and sales for the Model S, X, and 3 were ahead of production...which likely means there is a backlog developing (good for business) and an opportunity for them to produce and deliver a new record amount of cars. Kind of like how people keep by Yeezy's I guess.

July 2019 - Around the 11th, Tesla had to report earnings again  I dipped my toe into Tesla waters again as the picture being painted was they were figuring it out. Elon was sleeping on the production floor this year, burnt out but hell bent on figuring out how to produce more cars each week. I remember when they could barely produce 5,000 cars in a week. Earnings was a mixed picture which was in-line with my thesis: I just don't need Tesla to crater.

October 2019 - Yes, I traded Tesla yet again. They have stayed focus and were rewarded with an earnings record. They jumped by the largest amount in 6 years on increased production and better margins. What had analysts been knocking them on...margins. Like Kanye, I don't always agree with many of the things he does but one can argue the music and his drive for fashion is genius.  Tesla I believe is a game-changer as an investment, its good for our planet, and the pressure it's putting on the auto industry. There are a few people not afraid to compliment the strangeness of this company like my buddy Ron Baron and a lady that I occasionally hear on CNBC. When I remember her name I will add it here.  With the #2 spot, thanks Elon, the SEC, and the pioneers who plop down a deposit on one of the models. 

Let's Have a Toast to the...

Hope you enjoy My Beautiful Dark Twisted Investing Mind!

 

Symantec / NortonLifeLock - It Goes Down In The DM

It's December and I wanted to recap my best performers this year. I hope these notes serve as a way to help develop a strategy and display that it's not hard to invest in things you know.  Ironically, I trade enough that I don't know exactly who were top dawgs until I began doing a little bit of data analytics over the year. So I'll let you know who surprised me and why they made the list from my notes.

Symantec Corp. (SYMC) now known as NortonLifeLock NASDAQ : NLOK

In 2019, Symantec Corp. stumbled onto my radar. Quick background, they are one of the old guards in the IT and cybersecurity space.  They are huge and in almost every large companies data center and for consumers like you and me...many of us use their Norton Anti-Virus system on our home computers. I started hearing rumblings that the financials have not been good and the CEO was stepping down, which led the stock to fall, over 10% I believe (May 2019).  So hear is a name I know is in every large company across the globe and in many households.  So I put my alert to buy Symantec and being a little greedy I waited to pounce at an even lower price. This example shows investing is about both timing and price. 

How my trade unfolded:

Early July 2019 - News hit that Broadcom Inc. had DM'd (my version of trying to hookup) with Symantec Corp. for somewhere around $28 a share. I was right YES! But only on the time of the stock, being greedy on the price, I did NOT own any shares and the stock had probably moved up from around $22 to $26. It wasn't official because Symantec Corp. said if you like it put a bigger ring on it...$28 ain't good enough. For me, watching this was tough because it made sense, but you win some and will lose many. But never forget about the ones that got away.


July 15 2019 - News broke that Broadcom Inc. was officially no longer in Symantec Corp.'s DM. They wanted no part of a golddigger, reaching for more money. Symantec Corp. was officially left at the alter and the stock dropped big time over 15% and was back where I first found it. A song popped into my head: "You don't know what you've got until it's Gone" and I decided to finally
buy Symantec Corp. Why, it was like Broadcom Inc. had done all of the hard work of getting the phone number and then giving it to me to make the call. So I went in big because I knew Symantec Corp. should be trading around the $28 dollar range. Now that's what I call a wingman.

August 8 2019 - Yup you guessed it Broadcom Inc. had the same song in their head too and wanted Symantec Corp. back. But they were more cautious and only wanted to buy Symantec Corp.'s enterprise business which supports those big companies that I talked about...NOT the anti-virus business they sell to consumers like us. How much: $10.7 billion deal, the stock move up to the 24-25 range.

November 5 2019 - Symantec Corp. (SYMC) is no longer in the enterprise space so they are "Feeling Good As Hell" with their new focus on consumer security products and identify protection and change their name to NortonLifeLock NASDAQ : NLOK   (Note: they bought LifeLock a few years ago)

December 10 2019 - Saw news today that McAfee (owned by Intel now) and a few Private Equity Firms are DMing NortonLifeLock. So the stock has jump above $26 dollars on the news

I wanted to thank Symantec / NortonLifeLock, Broadcom, Intel McAfee, and the Private Equity Firms for giving me my best position of the year and all the drama that unfolded better than a scripted drama show or TMZ news feed because I can make $$ of this drama.  Thank you Yo Gotti and Lizzo for songs that popped into my head as I wrote this. Reminder, if I can do it you can too.  I'm tagging Symantec / NortonLifeLock because I think other suitors may be lining up. #investandchill   #investingintheDM #hookupalert