Brian Stoffel Profile picture
Nov 29, 2021 9 tweets 3 min read Read on X
Over the past decade, I've been blessed with:

✅27% annualized returns
📈That's roughly 1,000% total

One of the keys behind those results: Looking for something that's often ignored by analysts...⤵️
OPTIONALITY

The practice of TESTING out a new product or service in an effort to fulfill its mission.

🔴If it doesn't work, it's no big deal -- it was just a test.
🟢If it does work, it's a game-changer.

Critically, the company already needs a wide-moat rev stream to count on
No company is a better example of this than AMAZON $AMZN

In 1999, books and music were the wide moat business. It decided to test:

🔴Amazon Auction (failed)
🟢3rd Party Merchants (huge success)
In the next decade, 3rd Party Merchants were so successful, that business line entered the left (wide-moat) side of the business.

Next, it tested:

🔴Fashion Retail (failed)
🟢AWS, Prime, Fulfillment (ENORMOUS success)
Ten years later, those winners were no longer tests, they were wide-moat businesses.

But the innovation didn't stop there:

🔴Quisdi (failed)
🔴Fire Phone (failed)
🔴Amazon Wallet (failed)
🟢Original video content (succeeded)
The result of all of this:

A simple $10,000 investment at the company's IPO is worth almost $20 MILLION TODAY!

But Amazon isn't alone, there are others you can invest in today.
@BrianFeroldi and I tackled this phenomenon in our recent video on OPTIONALITY.

We introduce
✅One small (~$11B) stock with lots of optionality
✅8 more stocks we're impressed with
✅How to find signs of optionality

We are busy making videos like this every week.

Why?

Because we want to spread financial wellness and help anyone lead a full, whole life (while not worrying too much about finances).

Our videos are completely free, and you can subscribe here:

youtube.com/brianferoldiyt…
To review:

OPTIONALITY is the ability to *test* new products and services that fulfill one's mission.

If they fail, it's not a big deal
If they succeed, it's a game changer

And no one has done this better over the last 20 years than Amazon $AMZN

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More from @Brian_Stoffel_

Jun 27
The last month of owning Celsius stock...

Explained simply $CELH 👇
The company hit a peak on May 24th at ~$95 Image
Using a Reverse Discounted Cash Flow Analysis with:

🟡2% Terminal Growth Rate (Modest)
🟡 10% Discount Rate (Modest)
🟢 25% FCF Margin (Aggressive)

Here's what was priced into the stock on that date Image
Read 11 tweets
Jun 23
How expensive is $NVDA really?

The answer might surprise you👇
Of course, we could look at common multiples:

🔵 Price / Free Cash Flow (trailing): 82
🟢 Price / Free Cash Flow (forward): 52

Those aren't obscene, but they are one of many data points. Image
My favorite tool: Optimized reverse discounted cash flow (rDCF)

First, we ask ourselves:

What's a reasonable FCF margin for $NVDA over the next 10 years?

I'll be super bullish and say 35%

- That's below where it is now
- Well above its averageImage
Read 8 tweets
May 24
Last week, I bought you the four stocks DUMPED from The Antifragile Portfolio.

This week, the four stocks BOUGHT in The Antifragile Portfolio👇
You might be wondering: "Why should I care?"

That's a fair question.

Below are the returns of The Antifragile Portfolio since the end of 2014 vs. S&P 500 and Nasdaq Composite.Image
1) Tesla $TSLA

It's not a *full* core position in the portfolio, but it felt like the right time to add based on the valuation and potential optionality. Image
Read 8 tweets
May 21
Everything changed on November 30, 2022

The changes have come in two waves.

But Wave #3 might surface tomorrow...👇
What was the big change?

ChatGPT was released.

And AI became the buzzword on every conference call.

The first winner was obvious
Wave #1: Semiconductors

Look at what happened to $NVDA's growth rate for GPUs used in Data Centers.

That growth could continue, but the conclusion is clear: the wave has already started. Image
Read 7 tweets
May 17
The Antifragile Portfolio has made 4 major SELLS recently

The stocks I've dumped👇
The Context:

I want stocks with:

1️⃣ A Wide Moat: Veeva's Moat is a MILE-WIDE
2️⃣ Optionality: Here's the problem👇

For years, Vault came out with new products that were gobbled up. I have the feeling we've reached saturation, but the stock trades like it hasn't. Image
The Context:

Workplace Collaboration competition is RED HOT ( $GTLB, $MNDY, $ASAN -- to name a few)

The big problem: These other companies offer *much* more transparency with regards to net dollar retention and other such metrics.

Without them, $TEAM just doesn't make the cut Image
Read 7 tweets
Apr 29
April 6th

I said: " $TSLA is cheap!"

It's up 37% in the last week alone!

Is it still cheap?

My answer⤵️
First, we need to take into consideration that free cash flow is plunging.

Inventory is up (a very bad sign for a vertically integrated company)

And spending on AI has been huge. Image
Using $1.4 Billion as trailing free cash flow...

FCF needs to grow 53% moving forward

🤯🤯 That's INSANE 🤯🤯

But there's a saving grace...⤵️ Image
Read 9 tweets

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