A thread🧵 on so called market traps of transitionary performing stocks which leads to retail getting stuck. Doing as lot of tweets floating on such stocks.
Will take example of one of such stock with my own twitter history though I never presented in public #Neulandlabs
Will take example of one of such stock with my own twitter history though I never presented in public #Neulandlabs
1. If you think, every performing stock will become an Asian paints, you are in for disaster. 99% of businesses are cyclic, only quantum differs. So, either do not overpay or if overpaying a bit and have confidence in the business, then,
hold for long (15-20% of companies still in long run generate 15%+ CAGR). One should know his time frame, expectation, price he or she is paying and what kind of investor class he belongs to. This is how story usually starts and ends:
This was perhaps the first time I was tagged on a #neuland tweet for some detailed notes sharing
Date: June 23, 2020
Price : Around 450
I like to study companies in slumber, 60-70% down, no optimism (oh I forgot only momentum investing makes money)
Date: June 23, 2020
Price : Around 450
I like to study companies in slumber, 60-70% down, no optimism (oh I forgot only momentum investing makes money)
In fact, if you will go to my timeline, was heavy into studying pharma annual reports, why:
1. 4-5 years it had done nothing
2. Prices were down 60-70%
3. Some reports were hinting bottoming of margin
4. Neuland margins from peak optimism of 18% OM in 2017, it was at 9% in 2019
1. 4-5 years it had done nothing
2. Prices were down 60-70%
3. Some reports were hinting bottoming of margin
4. Neuland margins from peak optimism of 18% OM in 2017, it was at 9% in 2019
5. and recovering to 13% in 2020 but Covid ensured, that prices remain depressed
6. Did a webinar with @MashraniVivek on April 6, 2020 just when we all were shivering from Covid crash on how to navigate and presented my research on why and where we should hide - pharma being one
6. Did a webinar with @MashraniVivek on April 6, 2020 just when we all were shivering from Covid crash on how to navigate and presented my research on why and where we should hide - pharma being one
of them, the rationale you can listen 1:15 min onwards here:
youtube.com
youtube.com
7. Con calls were showing signs of optimism
So, with all that and then, research work, ended up buying Neuland around 450. We have a investor group in Bangalore @BIGInvestors . We do monthly group presentations and thought to present this idea but this was my condition as
So, with all that and then, research work, ended up buying Neuland around 450. We have a investor group in Bangalore @BIGInvestors . We do monthly group presentations and thought to present this idea but this was my condition as
intent is never to get others trapped at higher prices and I am not a sector expert or visionary to guess how the stock will do in 10 years n m an admirer of valuation , buy at a price, sell at a price. so, this was the message. Unfortunately, price
shooted up and was never comfortable presenting n never presented. Then, came results, reversion to mean, efforts of promoters of multiple years, whatever you call, blockbuster results
My own exuberance was visible as was sitting on so called multi-bagger but with a caution on historic margin volatility reflected in this tweet
My con call questions were also around margin volatility captured in this tweet from @tycoonmindset05
Had shared my notes/more a chat with a friend why I got interested in Neuland around 400-450 here (not many were bullish or talking good or bad about it except few respected one who have been with this company for a long long time n know it in and out)
March 17 '21 - Was stll holding funda position
Then, came this tweet . The long RED candlestick with high volume shook me off. Cut position partially at lower end of candle round 2100
Rest of position was holding and keen to know if the fall is due to exuberance, over-valuation, again reversion to mean of margins or something else. Went through FY21 AR in detail and actually liked it more than last year
However, technical were saying something else. Continued resistance for 2 months, inability to cross 2100 with likely H&S fall, finally, exited rest of position around 2000
Insight: Missed 2800 to 2000 but what saved me was entry at 450 when
Insight: Missed 2800 to 2000 but what saved me was entry at 450 when
there was pessimism n that time doing some research n hard calls. Momentum guys also made money, though entered late but those who knew how to exit, long term guys may also make money , those who have conviction n will be
right in their conviction. Hence, these tweets:
Then, came results and YoY, Q1 margins were down in 2nd consecutive quarters. Not sure , stock fell bcos big investors just exited after making X bagger or investors got spooked by
Then, came results and YoY, Q1 margins were down in 2nd consecutive quarters. Not sure , stock fell bcos big investors just exited after making X bagger or investors got spooked by
2 bad quarter but when charts say to exit, exit. Again remember, top was 2800, sold around 2000. Not blessed to find perfect tops
The renewed interest at good risk reward point at 1514 captured in this tweet when sharaaab to nashaa utartaa nazar aa raha tha twitter pe, those who were singing tunes by entering at 2000+ were gayaab
Q2 margins have been back to YoY level if not better, depreciation ate a bit. Stock consolidating from 1500 and now at 1800 when in last 2 months many stocks are down by 15-20%+
So, here is moral of the story:
1. The mud slinging will go on. Bulls will thump their own victory, bears will thump their own. Everyone will show their own intelligence and other in down regard but ultimately, all this should be noise to you.
ITS YOUR MONEY AND YOU SHOULD
1. The mud slinging will go on. Bulls will thump their own victory, bears will thump their own. Everyone will show their own intelligence and other in down regard but ultimately, all this should be noise to you.
ITS YOUR MONEY AND YOU SHOULD
KNOW HOW TO HANDLE BECAUSE YOU WILL REAP REWARDS AND YOU WILL BEAR SUFFERING
2. First know, what kind of investor you r n then think about what kind of investment you are doing. Buffet and all is great on books, real market me fat ke haath me aa jati hai jab 30% ka fall ata hai
2. First know, what kind of investor you r n then think about what kind of investment you are doing. Buffet and all is great on books, real market me fat ke haath me aa jati hai jab 30% ka fall ata hai
Nothing good or bad, just find a style which suits your temperament n skills
This is longest twitter thread n has limit, so, continuing in new thread :)
This is longest twitter thread n has limit, so, continuing in new thread :)
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