Outline of this Thread - What To Do:
• Pre & Post Earnings
• During the Earnings Call
• Key Metrics to track
• The Psychology
Earning can be a merging of multiple expectations (h/t @jackbutcher)
A Comprehensive guide below:🧵
2/ Why should you care:
• Earnings report (ER) are crucial times
• *Many* Institutions have their expectations & are ready to increase/Initiate/Decrease position which lead to big stock movements
• It determines future of a stock
Factors:
1⃣ How much a company beats the Analysts estimates on Earnings, Revenue & Guidance
2⃣ Customer acceleration
3⃣ New product launch/ M&A
4/ Pre-Earnings: How To Prepare:
• Know the analyst estimates for earnings & revenue!
• Review previous ER & know the past guidance
• Importantly, develop your own model of what you expect from the company metrics!
• Position size
Prepare mentally for a 50-50% scenario!
4i/ Actual ER - On Revenues:
• Separate btw organic & acquisition rev growth eg. $TDOC
• Be aware of easy comps/extraneous factors (seasonal adjusted)
• Comparing year-over-year revenue growth is great.
However, sequential QoQ growth is more important.
Ideally this ⬇️
ii) On EPS:
• Review the estimates and % beat rates.
• Are earnings improving or is there a good reason why it is decreasing?
• Knw GAAP v Non-GAAP
Phenomenal companies produce something like this eg. $NET $CRWD
They do big beat on expectations and EPS are revised higher.
iii) Metrics to watch
- Revenue metrics are good, but bottom-line metrics are more important:
✅Know ER dates
✅Keep clean notes and a record
✅Be prepared by knowing analyst expectations
✅Biggest ER factors: Earnings, % Surprises & Guidance
✅Prepared mentally (and realize even after a good ER, stocks gap down.)
Business Momentum is key!
15/15 END: Always zoom out
If you have a long-term horizon:
✅Quarterly reports are like days. They are short-term and either help build conviction or not
✅People have sold multi-baggers on one poor earnings report or captured a golden gem from one
Through experience, what have I missed out that new investors need to know?
I'll recommend following cc' @HenryChien4 - Henry has 10-years experience on Wall Street as an Investment banker and research analyst at the big banks. He knows the ins and outs. Kindly share your thoughts.
The company's culture has been strong through the pandemic.
Beyond the valley's ideologies, the move of their HQ to Denver from California is partly a hint of the major work they will be doing with helping scale AI solutions for heavy industrial clients in TX
Why $ETSY could be $100B company by 2025 and a valuable lesson for New Investors.
Here is a Thread 🧵 //
2/ $ETSY Product:
Etsy operates a marketplace offering a largest selection of locally made gifts. Everything from jewelry, clothing, pottery, bath, body, now home furnishing and 10-more areas!
They operate a two-sided marketplace between buyers (82M) & sellers (4.4M) as at 2020
The Moat:
3/ Brand Recognition:
• Over 80%+ of purchases on $ETSY are made by organic buyers compared to 20% paid by marketing
• This level of word of mouth helps to lower CAC and drives scale.
• $ETSY has become a household name and this is likely to stick post-pandemic.
Primer on How Investors can build an AI Portfolio to capture the $13T Opportunity from Artificial Intelligence by 2030.
Mega Thread //
• A Framework for evaluating AI Companies
• Top Companies that will continue to dominate
• First Principles basics on AI
Let's Review⬇️🧵
* Disclaimer: Not advice
1/Some context - This is a follow-up to a Twitter spaces with some brilliant folks:
Thread Outline:
• Foundational elements
• Debunking AI
• My framework for structuring an AI portfolio
• My Top Companies to watch
• Market Opportunity
• Summary
🔽
2/ What's AI?
Debunking it - AI simply involves training a complex system with huge amounts of data using algorithms (instructions), then using that trained system to make predictions about new data it has never seen.
Below is a break-down of the types (ML & NLP are common)