Stocks That Look Like Good Bargains
Space, AI, Real Estate, Renewables, Tech, Materials & Healthcare
A lot has happened in the past few months which I want to address but don’t think they each deserve a full article, so I am just going to share short commentary on where things are and what I am doing with my position (All allocation targets mentioned below are on the basis of principal invested, it does not take into consideration gains or losses).
In the second half of the article, I’ve also shared a few new tickers that I like and am currently adding to.
On Sept 19th, 2023, RocketLab had a launch failure and the company issued this statement:
Following lift-off from Launch Complex 1, the rocket successfully completed a first stage burn and stage separation as planned, before an issue was experienced at around T+ 2 minutes and 30 seconds into flight, resulting in the end of the mission.
Source: Business Wire
This was RocketLab’s 4th launch failure in 41 attempts.
Source: Spaceflight Now
...Rocket Lab has delivered 171 satellites across 37 successful missions. The number of successful launches is impressive for a start-up. Rocket Lab’s first commercial launch occurred in 2018. It had nine launches in 2022, and eight in 2023, before Monday’s failed attempt.
Source: Barron’s
As an investor in Space, I am fully aware of how difficult and unforgiving space can be. I had always anticipated that at some point we would be dealing with an issue like this, but in all honesty, I never thought it would be RocketLab.
While we still await results from the inquiry on why this happened, I trust RocketLab’s Management Team to eventually overcome the issue and get Electron flying again. This definitely hurts RocketLab’s legacy and the next couple of flights are going to be crucial.
I am continuing to Dollar Cost Average into my $RKLB position. I am currently at 106.5% to target. Intend to re-balance whenever I break even next.
I wrote about both stocks on July 21st, 2023 and since then both have taken a beating.
$ENPH has broken the $120 support and $FSLR is also now below both its 200 dma and 50 dma on a 1 year chart. So technically both look weak.
Interest rates remain the primary issue here.
Barclays recently noted that we are likely to get ‘more bad news before we get good news' on the solar front.
I am continuing to Dollar Cost Average into $ENPH and am currently 106.5% to target. Intend to re-balance whenever I breakeven next.
I am at 39% to target on $FSLR and am adding aggressively.
VICI 0.00%↑ ABR 0.00%↑ MAA 0.00%↑
I wrote an article on real estate May 8th 2023 and after a little bit of a pop, these stocks are back in the buy zone. Please refer to the old article for more details.
In addition to these three tickers, I have also been buying into $GLPI which is also a speciality REIT, similar to $VICI. Yielding 6.68%, $GLPI shows up in the young dividend aristocrats and is worth looking into.
I’m at 95% to target on $VICI and $MAA and at 100% for $ABR & $GLPI. Will continue to Dollar Cost Average as long as it is below my buy price and re-balance at breakeven.
I wrote a brief note on $ENVX in my article titled The Next Bull Market on April 17, 2023. $ENVX is trading 26% lower than where it was back then. Also in the last 1 year, it hit a 52 week high of $23.90.
This stock is still pretty much pre-revenue and the stock, therefore, has no bottom and can fall further. However, if their technology is able to scale, which I am betting they will be able to, this can be a 10 bagger, easy.
I'm 110% to target on $ENVX. Will continue to Dollar Cost Average as long as it is below my buy price and re-balance at breakeven.
Other tickers I think are interesting right now!
COPX 0.00%↑ - Copper prices have fallen considerably on the back of continued China weakness but Copper is the metal for an electric future and I am continuing to add to it.
105% to target. DCA below average buy price, re-balance at breakeven.
ALB 0.00%↑ - Lithium has also taken a beating over the last year as interest rates slow down the EV sector and China weakness weighs in here too.
While Goldman Sachs Group sees lithium carbonate prices falling further over the next 12 months, Wilsons Advisory sees the current dip as a great opportunity to buy lithium stocks, anticipating long-term price support from future demand growth.
BloombergNEF forecasts a fivefold global lithium demand increase by 2030.
120% to target. DCA below average buy price, re-balance at breakeven.
LAC 0.00%↑ - Apart from above mentioned catalysts which are relevant to $LAC too, $LAC being a US producer is looked at as an even more favorable investment.
Here are a few recent news clips to drive the point:
Lithium Americas project in U.S. volcano 'could be biggest deposit ever found' - Video
DoE is considering a historic $1 billion loan for massive Lithium Americas mine - Bloomberg - Video
Lithium Americas surges following the completion of its split from Lithium Argentina - Video - Video
75% to target. Continuing to DCA.
HIMS 0.00%↑ - Hims is an interesting business that I think will be sticky. Given the nature of the issues it deals with, like providing medication for ED and Hair Loss, people don’t often like to talk a lot about it and a discreet subscription is ideal. Hims has a high cost of advertising to acquire customers but if it can indeed drive stickiness then at some point it will flip profitable, likely late 2024-early 2025. Revenue has been growing quarter over quarter nicely which gives me confidence.
80% to target. Continuing to DCA.
BOTZ 0.00%↑ - BOTZ is the Global X Robotics & Artificial Intelligence ETF. There are a lot of such ETFs but I like this because of the holdings. The fund’s largest allocation is ~15% to Nvidia. While most of the other robotics and AI funds have reduced their allocation in $NVDA, $BOTZ has not and I genuinely think that as things stand now, $NVDA is front and center for anything robotics and AI. The fund also has 28.6% of the fund allocated in Japan, which is widely considered one of front runners in robotics.
60% to target. Continuing to DCA.
Borrowed Conviction Rarely Works
Past performance is no guarantee of future results.
The ideas discussed in this article should not be constituted as investment advice.
I reserve the right to change my mind if the facts change.
Disclosure: We own positions in some/all of the tickers mentioned in this article.