stock market was up today...

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Thunder Good-Oil said:
A better ETF would exclude far fewer of the giants. Maybe only take out the top 10 largest market caps or purge those that meet a certain threshold of perhaps $25-$50 billion.
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I hear what you’re saying, and that would make for a nice cross section. I would imagine there probably is an ETF out there that approximates that.

I like the composition of “J” though. It plays in some of the same spaces as the Counterpoint Global Team at Morgan Stanley. And I’m a huge fan of Counterpoint Global - they’ve been very, very, very good to my portfolio.

I think QQQJ is probably going to do very well over the next 3-5 years.
 
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85SugarVol said:
I hear what you’re saying, and that would make for a nice cross section. I would imagine there probably is an ETF out there that approximates that.

I like the composition of “J” though. It plays in some of the same spaces as the Counterpoint Global Team at Morgan Stanley. And I’m a huge fan of Counterpoint Global - they’ve been very, very, very good to my portfolio.

I think QQQJ is probably going to do very well over the next 3-5 years.
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They are the names just outside of the NASDAQ 100. So they all pop as they earn spots in the Qs.

There is supposed to be an ETF with the symbol QQQG for NASDAQ growth stocks, but it didn’t hit on one of my broker platforms. I didn’t dig further.
 
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85SugarVol said:
More than a car company. Energy company.
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Going to need massive government subsidization for those systems to be economical and not scare off your entire industrial base. I think they'll get it. We'll be Germany of the west. Despite the massive failures of Germany's own programs.
 
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Weezy said:
Going to need massive government subsidization for those systems to be economical and not scare off your entire industrial base. I think they'll get it. We'll be Germany of the west. Despite the massive failures of Germany's own programs.
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They have the ideal administration to get green subsidies. Never mind the science as it relates to energy production and the reality of disposing of spent batteries and mining for lithium. Tesla’s will one day be powered by unicorn juice and fairy dust. AOL has enlightened us with the truth.
 
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VolStrom said:
I'm always amazed when I see market caps like this for a company that actually owns next to nothing other than some software and maybe an office or two. For the entire existence of the company, they have only collected $110B in total revenue and they value them at $91B?
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The next dot com bust will be spectacular.
 
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NorthDallas40 said:
Me too! I’m expecting to be waiting a while. With all the turmoil of this year I moved mostly into fixed income funds. Too much risk for my liking.
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I moved a small portion of my money into fixed income when I saw the market going south, turned out to be a mistake because my investments are up around 13% ytd. Not too bad for a pandemic year.
 
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VolStrom said:
I moved a small portion of my money into fixed income when I saw the market going south, turned out to be a mistake because my investments are up around 13% ytd. Not too bad for a pandemic year.
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I’d kill for that this year. I’m positive a few percent but nothing to chest thumped about. I got greedy and waited too long or I’d have made about 50%. Back to timing that market thing ... 😥
 
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VolStrom said:
I'm always amazed when I see market caps like this for a company that actually owns next to nothing other than some software and maybe an office or two. For the entire existence of the company, they have only collected $110B in total revenue and they value them at $91B?
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Customer lists are extremely valuable assets that rarely appear on a balance sheet. But no doubt it is a rich valuation. Uber was way up at its IPO, fell to lower levels for a year or two and are just now pushing into a valuation above the IPO. Might still be below the run up at the launch, but certainly well above where it initially settled.
 
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Thunder Good-Oil said:
Customer lists are extremely valuable assets that rarely appear on a balance sheet. But no doubt it is a rich valuation. Uber was way up at its IPO, fell to lower levels for a year or two and are just now pushing into a valuation above the IPO. Might still be below the run up at the launch, but certainly well above where it initially settled.
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I won't ever buy a company stock that owns no real assets unless I do it through a fund. This is a faux company with no assets, they're essentially a website that aggregates rental properties and take a slice of the rent. I'm sorry, but no way, no how, they're worth $100+ billion dollars.
 
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VolStrom said:
I won't ever buy a company stock that owns no real assets unless I do it through a fund. This is a faux company with no assets, they're essentially a website that aggregates rental properties and take a slice of the rent. I'm sorry, but no way, no how, they're worth $100+ billion dollars.
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Other than REITs and manufacturers/Industrials/transports I’ll bet that most companies aren’t highly valued by their real assets after adjusting for their cash and marketable securities... maybe throw in inventory in some scenarios as well. I take it that by real assets you are excluding intangibles. IP is extremely valuable in tech. Microsoft, Google, and Amazon come to mind. They are some of the most valuable companies on the planet. Much, if not most, of Disney’s value is in its content library. Same for other media companies. Broadcast TV and radio groups most valuable assets are their FCC licenses. Netflix, cable providers, wireless providers are all richly valued by their subscriber counts. The Big Pharma industry probably has more $100 billion market caps than any publicly traded companies and drug patents are their most valuable assets. Coke’s most valuable asset is its brand.

Saying all that. AirBnB does seem to have been bid up to at least 4x a reasonable valuation. It’s a system, a customer base, an inventory of rooms (that they do not have to spend money on to maintain), an overwhelming market share with a huge barrier to entry, it’s projected revenue and the revenue growth.
 
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Carvana (CVNA):

Online used car dealer

Sells almost 200k cars/year

Grosses about $5 billion/year

25 car vending machines

Controlled by a shady family with a convicted felon patriarch

Market Cap is $45 billion

Market Cap of Ford (F): $35 billion
 
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Thunder Good-Oil said:
Other than REITs and manufacturers/Industrials/transports I’ll bet that most companies aren’t highly valued by their real assets after adjusting for their cash and marketable securities... maybe throw in inventory in some scenarios as well. I take it that by real assets you are excluding intangibles. IP is extremely valuable in tech. Microsoft, Google, and Amazon come to mind. They are some of the most valuable companies on the planet. Much, if not most, of Disney’s value is in its content library. Same for other media companies. Broadcast TV and radio groups most valuable assets are their FCC licenses. Netflix, cable providers, wireless providers are all richly valued by their subscriber counts. The Big Pharma industry probably has more $100 billion market caps than any publicly traded companies and drug patents are their most valuable assets. Coke’s most valuable asset is its brand.

Saying all that. AirBnB does seem to have been bid up to at least 4x a reasonable valuation. It’s a system, a customer base, an inventory of rooms (that they do not have to spend money on to maintain), an overwhelming market share with a huge barrier to entry, it’s projected revenue and the revenue growth.
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You make good points, but I'm old fashioned I guess and prefer manufacturing as way to value a company. Companies you listed like Microsoft, Disney, Big Pharmas and wireless providers all manufacture a product in my mind. Air BNB might not have any competitors in the space it occupies, but I can honestly say I've never stayed in one and I don't consider them when I travel. I look at them just like I do Tesla, they are way higher valued than Ford but have a fraction of their sales and assets.
 
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VolStrom said:
You make good points, but I'm old fashioned I guess and prefer manufacturing as way to value a company. Companies you listed like Microsoft, Disney, Big Pharmas and wireless providers all manufacture a product in my mind. Air BNB might not have any competitors in the space it occupies, but I can honestly say I've never stayed in one and I don't consider them when I travel. I look at them just like I do Tesla, they are way higher valued than Ford but have a fraction of their sales and assets.
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I think Big Pharma probably owns a lot of manufacturing and Disney their studios, but I think Microsoft contracts out what little manufacturing they’re still involved with. But MSFT might own the cloud infrastructure to distribute their software (and AMZN too). The wireless companies rent tower space from other companies and spectrum from the government. I think that all 4 have most of their value in their intangible assets/IP.

The great thing about AirBnB is that they don’t have to tie up any capital to build rooms or spend anything to maintain them. Hotels are in bad shape right now and have been laying off staff in massive numbers. They also have to pay property taxes (and municipalities will have to raise the rates significantly to sustain programs). I wouldn’t think that AirBnB sees diminishing marginal returns and in fact probably have the opposite as their overhead/administrative costs don’t seem like they’d have a high positive correlation to revenue.

One thing that I would like to know if I was going to invest is how they book revenue. Do they record 100% of the overnight rental paid by the lodging customers and pay a percentage to the owners of the rooms or is their gross revenue/top line just their cut of the over night stays? If they book the entire amount paid for the stay then their revenue is inflated. If they only record their cut as the gross revenue then which party is on the hook for disputed charges? Without looking it up I would guess that they record the larger number as revenue and the cut to the property owners is a cost of sales. So their revenue might be highly exaggerated.
 
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Thunder Good-Oil said:
I think Big Pharma probably owns a lot of manufacturing and Disney their studios, but I think Microsoft contracts out what little manufacturing they’re still involved with. But MSFT might own the cloud infrastructure to distribute their software (and AMZN too). The wireless companies rent tower space from other companies and spectrum from the government. I think that all 4 have most of their value in their intangible assets/IP.

The great thing about AirBnB is that they don’t have to tie up any capital to build rooms or spend anything to maintain them. Hotels are in bad shape right now and have been laying off staff in massive numbers. They also have to pay property taxes (and municipalities will have to raise the rates significantly to sustain programs). I wouldn’t think that AirBnB sees diminishing marginal returns and in fact probably have the opposite as their overhead/administrative costs don’t seem like they’d have a high positive correlation to revenue.

One thing that I would like to know if I was going to invest is how they book revenue. Do they record 100% of the overnight rental paid by the lodging customers and pay a percentage to the owners of the rooms or is their gross revenue/top line just their cut of the over night stays? If they book the entire amount paid for the stay then their revenue is inflated. If they only record their cut as the gross revenue then which party is on the hook for disputed charges? Without looking it up I would guess that they record the larger number as revenue and the cut to the property owners is a cost of sales. So their revenue might be highly exaggerated.
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My understanding from the brief research I did is they report the rental rate as revenue, not what their cut is. So if they rent a place for $1000 for a week and keep 20% for their cut their actual revenues are $200 not $1000.
I get that they don't have to tie up money in capital and taxes etc that are a cost with owning property and that's a plus for them. I think they have a good business model, but so did Uber and Lyft when they started with a similar business plan.
 
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VolStrom said:
My understanding from the brief research I did is they report the rental rate as revenue, not what their cut is. So if they rent a place for $1000 for a week and keep 20% for their cut their actual revenues are $200 not $1000.
I get that they don't have to tie up money in capital and taxes etc that are a cost with owning property and that's a plus for them. I think they have a good business model, but so did Uber and Lyft when they started with a similar business plan.
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Uber is just now hitting share price highs above their May 2019 IPO. I wouldn’t bet against any of Lyft, Uber, or AirBnB although I think that Air might mirror Uber’s pattern and possibly drop by half and take a couple of years to get back to yesterday’s euphoric opening levels driven by the buying frenzy.

I also wonder if Air is doing better than traditional hotels/motels during COVID as people avoid crowds. Personally I’d feel better staying in a Marriott, Hyatt, etc. as I’d trust them more to properly disinfect rooms than “amateur” renters. My sister is at the Intercontinental in ATL this week and she said there is very little staff and few customers. No room service and they only clean rooms every 4 or 5 days.
 
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