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MI Capital
@
MIcapital2
Seattle, WA
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Tech Investor. Former sell sider. Now on the buy side.
retweet = this is great. like = bookmark.
Anonymous account. MI Capital doesn't exist.
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636
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374
Osobe koje vas prate
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MI Capital
@MIcapital2
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4. velj |
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The answer is shipping cost as a % of revenue is a flawed metric. If 3p outgrows 1p, then this will undoubtedly go up. Shipping cost as a % of GMV or per paid unit makes a lot more sense (still going up but not by as much).
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MI Capital
@MIcapital2
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3. velj |
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I thought their main competition was Fortnite and sleep?
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MI Capital
@MIcapital2
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3. velj |
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That's why I put "/consumer". I think the tech non tech distinction in gen is sort of silly. Is it a good business? Does it scale? Does it have strong incremental margins? Does it have moats vs it's competitors? These are much more important than industry classification IMO.
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MI Capital
@MIcapital2
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3. velj |
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NFLX is a mega cap tech/consumer company. Similar to FB, GOOGL, AMZN, AAPL, it you want to find daily negative datapoints on the company, they are out there. Not sure they are always meaningful.
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MI Capital
@MIcapital2
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1. velj |
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Ex 1-time charges (FTC + IL) FB reported ~$30bn in EBIT. SBC was $4.8bn. So, for FB, SBC is manageable and adj. wouldn't make them look that much better, but not sure I'd extrapolate to smaller cos unless you think they can get to $70bn in revs and 40% EBIT GAAP EBIT margins.
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MI Capital
@MIcapital2
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1. velj |
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What's this look like on a Y/Y basis?
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MI Capital
@MIcapital2
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30. sij |
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TBH, I've thought this for about 2 years but they keep putting up pretty solid revenue growth (500bps of sequential growth decel this Q be damned). Question is, what's good enough for this stock and what does LSD-MSD decel for 1Q mean?
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MI Capital
@MIcapital2
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28. sij |
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Every time I look at this stock, I like the business and can't get behind the stock. I am guessing that bullish investors have higher aims for end-game FCF margins and just see open-ended 20% growth for a long time (10+ years).
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MI Capital
@MIcapital2
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28. sij |
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And you still hate DCFs? I'd rather have DCFs and a model that gets the company to end-game profitability than say the RBC TWTR initiation that applied a 65X out year EBITDA multiple. What is 65X based on? Why go out 3 years?
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MI Capital
@MIcapital2
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28. sij |
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I took 2 semesters of Damodarans class. I don't use DCFs to invest today but anyone who pokes fun hasn't taken his class or read his stuff. Everything is very rational and well laid out. The main criticism of DCFs is it can say whatever you want. Not if you do it his way.
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MI Capital
@MIcapital2
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23. sij |
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Also, if you can't get behind 5 or 10 year visions with (potentially) phantom end-game margins, you're not going to like a lot of stuff in Internet (or Software).
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MI Capital
@MIcapital2
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23. sij |
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I covered Smid Internet on the sell side and I have to say, almost everything in Internet not named GOOGL/FB/AMZN sucks. I think the problem a lot of "internet" companies like Z/GRUB/EBAY/EXPE had is they just aggregated supply and never bothered to build Original Supply.
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MI Capital
@MIcapital2
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23. sij |
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Great daily article by @stratechery today on $NFLX and releasing content all at once vs. a weekly cadence (among other hot topics like losing Friends, cash burn, etc). If you don't subscribe to Stratechery, I highly recommend it.
Consistently the best thing I read every week. twitter.com/MIcapital2/sta…
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MI Capital
@MIcapital2
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23. sij |
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I don't think this is correct.
1999: S&P ntm PE of 27x
#1 mkt cap MSFT 70x
#2 GE 40x
#3 CSCO 100X
Today: S&P 19x
#1 mkt cap AAPL 24x
#2 MSFT 30x
#3 GOOGL 28x
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MI Capital
@MIcapital2
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22. sij |
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You’re saying NFLX has missed 2020 estimates from July 2018. I’m saying that makes sense. The stock is down since then and has materially underperformed the market.
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MI Capital
@MIcapital2
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22. sij |
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*than
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MI Capital
@MIcapital2
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22. sij |
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I mean to be fair the stock was $400 then and the market multiple has gone up. You could probably do this for a lot of stocks that are even higher today then July 2018.
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MI Capital
@MIcapital2
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21. sij |
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Interesting. I think no extra incentive needed. News media likes clicks so that means writing about the evils of FB/GOOGL/UBER even though there are a lot more evil companies out there.
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Patrick OShaughnessy
@patrick_oshag
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21. sij |
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The biggest challenge isn't building good models, its using them and sticking with them. pic.twitter.com/PtcFaHIfsz
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MI Capital
@MIcapital2
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21. sij |
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I know. I'm commenting on him as an operator. Overrated IMO. Cloud Kitchens may be a big opportunity but 1) not sure He wins there and 2) don't believe it will be as big as Uber.
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