The Market Thread

[cableok]

Big time ouch! They're ravaging my boy TDOC. Had a goodwill impairment charge of $6.6 billion on the Livongo acquisition and down 35% after hours. Time to assess the carnage and figure out what to do from here.

I have been following TDOC since you mentioned it a few weeks ago. They, along with Livongo, have some good associations with many large corporations in HR benefits. I only think this will continue to grow as more people become used to home health and services like Livongo.

I think I am going to use this downturn due to the poor Q1 financial results as a buying opportunity.

 

[Im Ur Huckleberry]

I have been following TDOC since you mentioned it a few weeks ago. They, along with Livongo, have some good associations with many large corporations in HR benefits. I only think this will continue to grow as more people become used to home health and services like Livongo.

I think I am going to use this downturn due to the poor Q1 financial results as a buying opportunity.

I just listened to their conference call. Their biggest growth is in 360/whole person care and it seems like most of the competition has more niche offerings like mental care. They beat on EPS minus the impairment charge but higher ad spending and chronic care (Livongo) are dragging so they lowered guidance a bit for the rest of the year but sounds promising moving forward. I'll be averaging down over the coming months.

 

[jobob85]

TDOC is not a stock I had been following but, since it was mentioned a few days ago I thought I would. I have never been a fan of buying companies that have negative earnings and have trouble with the analysis. Still, even with the stay at home stocks taking a beating it seems this may have oversold (or could be a value trap).
Either way I sold some puts out of the money today. $28 strike price for tomorrow @ $1.17 a share. Either way I get a good return for selling some downside protection to a shareholder or pick the stock up at $26.83 a share effectively.

That stock trading range was interesting $1.00 to $400.00 I assume all bids and asks were filled at this point except for the outliers.

 

[Im Ur Huckleberry]

Morningstar cut their FVE for TDOC from $210 all the way to $60 for those of you following along...

 

[steross]

 

[andylicious]

Buckle up, this ride is going be turbulent.

 

[Boomer.....]

I don't think we're doing this right.

 

[steross]

I don't think we're doing this right.

Well, we aren't doing it right but we are doing it like near all of the others did before their decline:

 

[Im Ur Huckleberry]

Time to go shopping! Thought I would post a list of quality (and some risky) stocks trading at a significant discount to their Morningstar fair value estimate. With the stealth crash in tech and growth over the last 6 months that's where the deals are to be had these days. I would say at most these stocks have 20% downside and I only posted companies with 50% plus upside. Plenty of others out there trading at 30-40% discounts to their fair value. Love Morningstar because they're about the only ones who don't move their FVE based on where the stock is trading.

TSM - $97/share FVE at $179
Polaris - $105/share FVE at $184
Sony - $90/share FVE at $133
ET - $11/share FVE at $16.50 (plus 6% dividend and growing)
TDOC - $67/share FVE at $210 (my fave)
PINS - $22/share FVE at $60
TLRY - $6/share FVE at $14
LAC - $29/share FVE at $45
RBLX - $43/share FVE at $100
SOFI - $7.50/share FVE at $17
VWAGY - $22/share FVE at $38
FORD - $15/share FVE at $24
BYND - $43/share FVE at $98
OKTA - $143/share FVE at $280
LRCX - $466/share FVE at $720
FB/META - $214/share FVE at $400
ETSY - $112/share FVE at $221
CRM - $195/share FVE at $320
SAM - $376/share FVE at $750

We're back with the next episode of Bargain Hunters! (Sidenote: it took Herculean efforts to open my trading app to look at prices this AM)

GOOG - $2324/share FVE at $3600
AMZN - $2334/share FVE at $3850 (lowered from $4200)
TWLO - $114/share FVE at $376
CRSP - $52/share FVE at $119
DIS - $111/share FVE at $170
PYPL - $85/share FVE at $139
CHWY - $29/share FVE at $47
NOW - $466/share FVE at $700
TCEHY - $45/share FVE at $108
VEEV - $177/share FVE at $275
ADBE - $398/share FVE at $615
SE - $80/share FVE at $125
UBER - $26/share FVE at $73
DASH - $70/share FVE at $163
NFLX - $190/share FVE at $280
SHOP - $406/share FVE at $730 (down 15% on earnings today so FVE may be revised lower)
UPST - Morningstar doesn't have coverage but massive growth trading at $88 down from $400

P.S. if you pay $5/month for a Robinhood premium account you get access to very in-depth MS reports on these companies. $35/month if you go straight through Morningstar.

 

[steross]

Wage growth in blue. Wage growth adjusted for inflation in green.
Add this to the personal savings rate shown in post 1765 above. How long until people figure out they aren't doing nearly as well as they thought?

 

[ramases2112]

In your opinion, are we going to run into another 2008 recession or are going to hit a depression like the 1930's? I cant remember much about 2008 as I was only like 16 at the time so I cant tell if the terrible outlook currently is any worse than that time. It just feels like we are nearing a cliff and I cant tell if its a 6 ft drop off or the grand canyon.

 

[jobob85]

In your opinion, are we going to run into another 2008 recession or are going to hit a depression like the 1930's? I cant remember much about 2008 as I was only like 16 at the time so I cant tell if the terrible outlook currently is any worse than that time. It just feels like we are nearing a cliff and I cant tell if its a 6 ft drop off or the grand canyon.

2007 was a classic bubble burst like in the 2000 Tech Wreck. This one has the feel of a year long recession. Fed will grind the market and consumer spending down and hopefully get a reset to start upward trend again.

 

[ramases2112]

2007 was a classic bubble burst like in the 2000 Tech Wreck. This one has the feel of a year long recession. Fed will grind the market and consumer spending down and hopefully get a reset to start upward trend again.

Id like to think so too but in previous recessions we didnt have this level of debt and inflation. Those combined with other economic issues makes me think this is gonna be alot worse than 2008.

 

[jobob85]

Id like to think so too but in previous recessions we didnt have this level of debt and inflation. Those combined with other economic issues makes me think this is gonna be alot worse than 2008.

That would require a greater than 50% market drop among other things. If I believed that I would be sitting on cash and gold only.

 

[Bowers2]

That would require a greater than 50% market drop among other things. If I believed that I would be sitting on cash and gold only.

Plus, in 2008 we had massive DEflation. Much worse than inflation given the circumstances of that time.

 

[steross]

2007 was a classic bubble burst like in the 2000 Tech Wreck. This one has the feel of a year long recession. Fed will grind the market and consumer spending down and hopefully get a reset to start upward trend again.

I agree with this as most likely scenario.

I think there would have to be some external impetus beyond what we see right now.

Ideas- crypto market completely collapses. internal strife due to racial or income issues. Pandemic hits hard again and government reacts stupidly but without the firepower of free money again. China or others figure out a way to make the USD not the reserve currency. External war is a wildcard.

Our debt is stupid big and longer-term will be the death of us. But debt to GDP while bad and worsening isn't THAT bad compared to others yet.

 

[jobob85]

We are looking at a 2008 collapse based on private debt going tits up. Now we are looking at Government debt and the Fed reducing their position in government debt with the ability to control that reduction.

Early I said gold and cash but, depending on how you think this will play out, maybe US$ is not a safe haven.Personally I still like cash because it is losing value slower than most other investment and can easily convert into another financial position.

 

[jobob85]

I agree with this as most likely scenario.

I think there would have to be some external impetus beyond what we see right now.

Ideas- crypto market completely collapses. internal strife due to racial or income issues. Pandemic hits hard again and government reacts stupidly but without the firepower of free money again. China or others figure out a way to make the USD not the reserve currency. External war is a wildcard.

Our debt is stupid big and longer-term will be the death of us. But debt to GDP while bad and worsening isn't THAT bad compared to others yet.

Exactly, we just have to be in a better position than everyone else.

 

[teachum]

So tempted to get more Boeing. I know they have issues, but how much lower could it possibly go??

 

[Im Ur Huckleberry]

So tempted to get more Boeing. I know they have issues, but how much lower could it possibly go??

Famous last words in this market! I would just be sure to DCA and be very patient picking your spots. But yeah, today looks like a good spot to be buying almost anything.