I realize you have a choice in the newsletters you subscribe to and my way of saying thanks is to offer original analysis. Most newsletters will wait for breakouts and price momentum and then backfill the analysis. This creates a few issues from my perspective. The first is that conviction gets shaky when basing investments on price only as it requires a herd mentality to remain in a stock. The best gains come from getting in front of the herd. The second issue is that many tech companies go through periods of high growth yet can’t sustain this long-term unless there is excellent product market fit. Momentum investors and trend followers struggle most when it comes to FAANG-like gains because they can’t determine the true gems from those that are simply doing what most tech does (disrupt a market for a period of time).
Case Study: Zoom Video
On a recent Bloomberg interview, I discussed Zoom Video as the stock that is “sitting right under everyone’s nose” due to growth that we haven’t seen in my lifetime or yours and likely won’t see again over the next decade.
Tech Sector Is Only Going to Grow: Beth Kindig
This is a stock tip I released in the wake of the coronavirus shut-downs on April 3rd. There was a lot of noise in the market at that time due to the bull/bear market tug-o-war. I said, “If Silicon Valley unicorns are rare, then Zoom Video is a Pegasus.” The company then went on to accelerate from 78% year-over-year growth to 169% year-over-year analysis to 355% year-over-year growth. Keep in mind, I wrote this and maintained conviction even as the market began to question Zoom Video’s security issues.
