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_

Oct 7
SaaS stocks used to be the cornerstone of my portfolio.

Not anymore.

I just cut ties with yet another.

Which one, and why? 👇Image
The stock: DataDog (DDOG)

🟢The good news: I earned market-beating returns.

🔴 The bad news: I was no longer confident in my ability to detect a moat.

Here's why that's so important👇Image
Let's say I live in a time and place that's NEVER had apples.

I show up and start selling apples.

They FLY off the cart and I make TONS of profit.

YAY! Image
Read 16 tweets
Aug 12
I Threw In The Towel

The 8 (Mostly Tech) Stocks I've SOLD Entirely in 2024

(From Worst to Best Decision)👇
8) Intuitive Surgical $ISRG

The Reason: Valuation

The Date: May 20th

The Results:

🟢 $ISRG: +16%
🔴 $SPY: +1%

The Verdict: I love this company. I might've under-estimated how long 15%-ish growth can continue for.Image
7) MongoDB $MDB

The Reason: Moat under attack

The Date: June 6th

The Results:

🟢 $MDB: +2%
🔴 $SPY: +0%

The Verdict: Jury is still out in terms of returns. But I'm more comfortable watching and learning from what happens.Image
Read 14 tweets
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

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