Sale of position in Smartsheet (460 shares); Purchase of 300 shares of SentinelOne, Purchase of new Position-250 shares of Procore In the wake of the earnings Smartsheet reported last evening, we decided to sell our position. I want to make clear that the sale doesn’t reflect either a bad quarter, or bad guidance. The company…
Summary Smartsheet’s share price decline has brought its EV/S ratio to around 4.5X, with a projected free cash flow margin of around 12% over the next 12 months, making it an attractive investment opportunity.The company is a leader in the workflow management space, with strong growth in profitability and free cash generation, and is set…
The market was having a nice week until Thursday. Then of course, investors started to worry about a hot inflation print, and they got what they feared on Friday. The net result was another share price implosion. Readers will notice that these 3 companies aren’t seeing any pullback in the growth of their business. While the…
Summary Smartsheet’s latest quarterly earnings release marked another quarter of greater than forecast performance, most notably in terms of calculated billings. The company chose to provide investors with a cautious guide; it typically has over-performed its forecast. The company’s deferred revenue balance has grown 51% year on year providing the company with greater than normal…
An extremely volatile week, although the net results was a significant snap-back rally. Our high-growth portfolio had the largest percentage gain since it was launched in August 2016, and was up by almost 21%, without much in the way of leverage. Our acquisition of an additional 500 shares of Affirm worked out, but it was…
We initiated a position in the shares of Okta last fall at a price of $261. We believed that the merger with AuthO was underappreciated, and that the growth opportunity was substantial. In a way, that played out. But along the way, the shares were hugely rerated along with most other tech names. Then the…
Summary The thesis here is that high growth names are able to produce sizeable returns despite the headwinds of inflation and higher interest rates. The thesis is supported by notable valuation compression in many names that has proceeded unremarked through much of 2021. In addition, most high growth companies are expanding their TAMS by aggressive…
I am sure that subscribers will recognize that the last few days have seen a rather substantial pull-back in high growth tech names. Some losses have been greater than others. None of the valuation contraction has been based on some particular changes in the outlook for growth names, or their overall operational performance. We will…
Tuesday afternoon, several significant software companies reported their results. I will focus on Smartsheet and Crowdstrike since they are holdings in our high growth portfolio; Coupa (COUP) also reported results which were a significant beat compared to prior expectations. It should be apparent that while the violent sector rotation of the past few weeks has…
Summary Enterprise software turned in a spectacular performance in 2020. My tea leaves suggest that the space will continue to outperform broad indices in 2021. I think a reasonable portfolio should focus on those companies who experienced demand headwinds in all or part of last year. I have taken a portfolio approach to making recommendations.…