1/ My wife, who is a far better investor than I - no investment training/background, a Peter Lynch type eye (has no idea who Peter Lynch is) - instructs me tonight to sell $TWTR and buy $LEVI
brief thread on her rationale, curious to hear feedback
brief thread on her rationale, curious to hear feedback
2/ Sure, $TWTR is a great platform and growing in importance, but Jack has made it clear that profits are not a priority. So much so, in fact, that he's basically aligned the entire organization behind the idea of pursuing the company's agenda of social good ahead of profits
3/ There is nothing wrong with that - indeed its admirable. But from an investing perspective, with time value of money, opportunity costs and all that nonsense, perhaps Twitter isn't the best place to park money as an investment
4/ I mention to her that perhaps Twitter could be pushed or acquired by someone with an eye for profits. But - its clear the organization, its 4,000+ employees, are big fans of Jack - again, nothing wrong with that. One of the greatest innovators in recent history..
5/ If an activist or acquirer tried to push $TWTR to shift its objective to profits, as potential cost of the social good, you may have an entire enterprise-wide uprising. Not really common in corporate america. Unique to Twitter (perhaps few others) and culture Jack has built.
6/ on to $LEVI - what is interesting about it, I ask? They make jeans... she tells me that the jeans they used to sell for $30 now sell for $98. And they are 'on trend'. They are targeting 'millenials' and its starting to resonate
7/ Would look expensive as a retail company, but as a brand manufacturer perhaps not so. Particularly if there are levers to pull around their pricing and market positioning
8/ Conclusion: Couldn't argue with her logic, and will now do a deeper dive in to $LEVI. Never looked at it before. Curious to learn more. Cannot disagree with the Twitter assessment.
Full disclosure: her previous pick was $NFLX at $230. Never looked at any number or subscriber counts. We watch a lot of their international content. Her: "No one is even close & this is a gold mine of content. Buy Netflix". Value investor in me said "no way", but we did anyway
