Chat Highlights-Building a Power Portfolio

Summary

  • Aemetis stands ready to take off.
  • Teladoc Health capitulated. What’s next?
  • Alligator jaws may be coming for Tesla.

Each week we publish a summary of a few of the articles, topics and ideas found in the MoSI chat. We encourage you to visit chat to read about updates to our investments, share ideas, and ask questions. What follows are a few of the conversation threads from this past week and links to some videos and articles. Join us in the chat.

Aemetis-a ramp that’s about to hit an incline?

Kirk Spano Feb 20

In 2023 the minimum market cap to be included on the Russell 2000 was $159.5 million. Since the reconstitution, Russell 2000 is up about 14%. So, that implies the smallest companies added to IWM will have market caps of about $183 million. Let’s round up to $200 million to be safe. Aemetis (AMTX) is currently at $138 million with a share price just south of $4. We need a price of about $6 for inclusion on IWM. There will be a war with shortyewwws over that, but, they have only had enough firepower to keep it in this range for months. They have no more firepower it’s pretty clear.

So, any buying, by money managers, family offices, institutions, Canada or California Pension, Hugo, me, you, really is going to probably be enough. What if some trading group flips from buying puts and selling calls to buying calls and selling puts? Look at the chart the past 6 and 3 months. Notice anything about the chart since January 18th? Nothing but higher lows. That’s a nice ramp that’s about to hit an incline I think. I’m buying more shares again. And, maybe a few calls. Things that make you go hmmmmm.

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What’s up, TDOC?

Kirk Spano Feb 21

Teledoc Health (TDOC) just capitulated. Went straight to the Fair Value Gap trap that institutional traders use to trigger stop losses. Bottom is roughly in now.

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So, Teledoc (TDOC) growth is slowing as industry matures, but they have about a billion in cash on hand. TDOC is 2 things now: A trading stock and a takeover waiting to happen. Its book value is about $14 but it’s not highly profitable yet, so a $20 something price.

Hard to know how much MSFT or someone wants it. They could merge with another company like it and then cut the heck out of costs. Ultimately, margins would be higher then as the industry consolidates. I’d think a merger is most likely since there’s no justice dept. issues with that vs big tech buying them. Big tech buying them is best for shareholders over next 1-2 years. Merger takes longer.

Health data access is a big deal long-term which is why everyone wants it, but, for now TDOC probably is range bound for a while. My cost basis is $18.59 and I sold covered calls to lower it about a buck. So, I’m not much underwater. I understand people don’t like to wait for things to shake out and frankly I’m a bit tired of waiting too while other ideas go up. So, I’m trimming to a small starter and will sell some cash-secured puts. I’m going to look for movement towards either being bought or merging. We’ll see if the tea leaves spill ahead of time.

Is it alligator jaws for Tesla and Ford?

Kirk Spano Feb 21

If you ever wonder if I’m early, the answer is yes, so very yes. One CIO at a big regional firm said to me at an event, “I do almost everything you say, about a year after you say it. I keep a Kirk notebook.” lol. Another CIO at a large RIA said “about two years after you say something, it starts going up fast.”

I’m working on the being early. Not in the ideas, but when I make the investment. That’s where technical analysis comes in. A little early is ok, but a lot early I know half the people can’t do. While I focus on 3-5 years and I know about half of you can live with that, most investors are 1-2 years investors. Just the way it is. So, yeah, I’m trying to only be a year early on stuff best I can.

Here’s one that I’m getting closer to not being early on. Other analysts are starting to understand my Tesla (TSLA) trepidation and thought that a lot of car companies are going to close the gap. Tesla (TSLA) flat to down, other car companies up, Ford (F) is my favorite.

Tesla and Mercedes-Benz earned almost exactly the same last year. Their stock-market valuations are slightly different.

Links to articles posted in the chat

After rockets and spacecraft, Rocket Lab’s next frontier could be applications | TechCrunch

How the US is preparing to fight – and win – a war in space

We’re entering a golden age of engineering biology

Aemetis Announces Updated Five Year Plan Projecting Growth to $1.95 Billion of Revenue and $645 Million of Adjusted EBITDA in 2028

Enovix Announces Fourth Quarter and Full Year 2023 Financial Results | Enovix

Rocket Lab Successfully Returns Spacecraft Capsule to Earth, Brings Back Pharmaceuticals Made in Space

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