Well in this video/blog post you guys are gonna find out i’m ben and welcome to motivation to invest.
Share Price action
Affirm Stock Business model
Affirm founder Max Levchin ( paypal mafia )
Deep dive stock analysis of Affirm (Financials)
Affirm Stock valuation and buy points.
Investing Risks
1. AFFIRM SHARE PRICE ACTION:
Affirm ipo’d in january 2021 the stock actually had a lot of exuberance behind it it shot up by around 50% and then actually declined also by around 60% with the whole tech stock correction and rotation out of tech stocks.
What does a Affirm actually do what’s this company’s business model.
Affirm is involved in what’s called the buy now pay later space, if you go onto many websites and you’re purchasing especially high ticket item you’ll often see a little button and it says you can buy now and pay later so you can pay an instalments for a product now a firm has a variety of major partnerships with big companies such as walmart.com peloton adidas expedia and many more.
This will let consumers buy expensive things in instalments , so the partnership will allow customers to break up purchases of $50 or more into smaller instalment. Amazon is the leader in e-commerce it’s a trillion dollar company i believe over 50% of the u.s population are now amazon prime members so this is a major major partnership for a firm.
3. AFFIRM Founder Max Levchin
The founder is Max levchin , He’s part of what’s called the Paypal mafia . The Paypal mafia is a group of technology entrepreneurs which have changed the world.
Many technological companies with billion dollar valuations most of them were founded by members of the paypal mafia, which were the original paypal founders.
We’ve got peter thiel here who is a co-founder of Palantir, we’ve got all the founders of youtube which of course is owned by google now we’ve got Elon Musk , obviously founder of tesla & spacex and of course we have max levchin who used to work on a product called slide but his heart wasn’t really in that product and he was more interested in the fintech arena,.
INVEST WITH GREAT FOUNDERS?
so my personal investing philosophy after reading over 600 books on investing and studying the greatest hedge funds of all time is to invest with great founders. Those with skin in the game and a large portion of their net worth in the stock of the company.
Max Levchin has 6.36% ownership of a firm.
He’s only paying himself ten thousand dollars per year salary! so he’s paying himself a very low salary this guy’s heart and soul is in the company.
Shopify owns 7.66% of the firm. so to me that’s a real deep embedded strategic partnership which is great news for a firm.
Affirm is burning a lot of cash at the moment, so they’re burning around 300 million dollars every single year. Revenues also forecasted to increase to 1.1 billion dollars by 2022. Sales growth over the past period has been 66%.
Price of sales of 48. so you’re paying 48 times the company sales looking backwards!
5. Affirm Stock valuation and buy points.
Plugging in my projections, 65% growth rate next year, 50% for the next two to five years. Predicting Affirm can grow its margins in the next five years to 23% which is the average for a software company.
FAIR VALUE FOR THE STOCK: $68 per share (From Discounted Cash Flow Model)
Will the stock crash and burn?? Well in this video you guys are gonna find out this is an essential video to watch because amc stock has been on a rampage and i’m going to dive into
what’s been driving this meteoric rise in AMC’s Stock Price? (up 1900%!)
Fundamentals of the AMC Stock
so without any further ado let’s hop right into it!
Price action for amc cinemas so if we go back to 2019 let’s see how amc was doing pre pandemic and we can see the share price was steadily declining from 2017 he was down 80 percent even before the whole global pandemic so what was driving amc’s lower stock price well a variety of factors firstly the company has really high debt which i’ll get into later in this video.
From two dollar lows in january 2021 the stock popped by over 1900% percent now the stock has since corrected down now and the stock is corrected down by 24 but that still leaves the stock if we go from here still leaves the stock up 000 year to date so that’s just really incredible incredible returns for a lot of those diamond-handed investors who were investing in trading amc stock or is this a crazily risky stock to invest into.
MOVIE THEATRE HEADWINDS: STREAMING WARS!
The second major driver is a headwind against the movie theater industry which is driven by streaming service providers such as netflix.
People would rather watch a movie series watch a movie at home on netflix or on another provider such as amazon video amazon prime then actually go out to a cinema this really is a change of habits generationally which has happened across the board!
SHORTER RELEASE TIMES (MOVIE THEATRES TO STREAMING)
Third major headwind against the movie theater industry is the fact that many major networks have agreed now to shorter release time so if you guys are a bit older you remember 10 20 years ago if you watched a movie in the cinema you’d have to wait a few months to actually get that video on a dvd on a video tape to watch it in your home and now all the major networks have agreed that they will now have much shorter release time .
So people will watch them very very early but this is bad news for the movie theater industry but all these headwinds have resulted in amc stock price having a major decline pre-pandemic so this company was not looking very good in terms of its fundamentals but then of course the major pandemic hit and this was actually even worse news for amc and all movie theater businesses because people couldn’t actually go and use their facilities and the company was still burning a heap load of cash as they still have to upkeep all their facilities okay so if the movie theater industry is going for a terrible time why is the stock up by nearly 2000%.
FUNDAMENTALS OF AMC STOCK?
During the global pandemic amc’s revenue plunged and it sank 77% down for the full year of 2020 to 1.2 billion and amc reported a net loss of nearly 4.6 billion.
so this company was burning billions of billions of dollars in cash now this was compared to a loss of just 149 million in 2019 so the company burned through cash at a rate of more than a hundred million dollars per month during most of 2020 and at the same time face deferred rent payments.
AMC RAISING CAPITAL?
Amc’s management did do a really smart move so when they saw their share price skyrocket what they actually did was raise some capital so they issued new shares in order to actually raise real money to support the business so the company raised 1.2 billion dollars in the second quarter by issuing new shares that’s on top of the more than 1 billion raised through share sales last year in the first quarter of the year .
This is a really smart move by amc although not great news for existing shareholders of the company because it will dilute them. But it may be the only thing amc can do to survive and this really could become a self-fulfilling prophecy, if people believe so much in amc or they just want to play this momentum game and trade the stock upwards,
If amc keeps issuing shares and raising billions of billions of dollars then there is a small chance the company could survive but otherwise it’s not looking very good for amc stock from a fundamental level hopping into the numbers here you can see things a little bit more clearly.
AMC FINANCIAL PROJECTIONS & HIGH DEBT:
So the company is expecting 2.4 billion dollars in revenue in 2021 which is expected due to cinema’s reopening across the world however the company will still have over 1.3 billion dollars in losses this is expected to improve to 4 billion in revenue by 2022 and 369 million dollars in losses so the company is projecting some improvements there but really the elephant in the room is the company’s high debt so amc cinemas is eight times levered and this high debt will really weigh down the company moving forward in the future.
IS AMC’S Stock Price Rise a SHORT SQUEEZE?
We can see the short interest over time for amc has really fluctuated between five billion dollars and three billion dollars so currently around 15 to 16 percent of amc’s float.
However, I believe this isn’t driven by a short squeeze and that hypothesis is driven by looking at amc’s trading volume.
The company has a trading volume of 3.2 billion shares traded now the fact that there are only 500 million shares outstanding makes me think that this is actually one of the most traded stocks in the world this isn’t a lot of diamond-handed investors holding this stock for the long term this is a lot of people trading the stock and getting fast gains now the smartest and the fastest among them will be making a lot of money but on the corrections and the crashes there will be a lot of people who will be left holding the bag.
IS AMC STOCK A GAMMA SQUEEZE?
What is a gamma squeeze?
A gamma squeeze can happen when there’s widespread buying activity of short dated call options for a particular stock this can effectively create an upward spiral in which core buying triggers higher stock prices which results in more call buying and even higher stock price.
Amc’s major stock gains has been driven by a gamma squeeze and also by the retail investor exuberance behind this stock which is really one of the classic meme stocks (in my opinion).
HOW AMC CAN SURVIVE?
if amc wants to survive it needs to raise more capital and issue more shares . however to do that it needs a shareholder vote so it’s clear that amc actually needs these retail investors to actually support the company and allow them to dilute their shares.
It’s pretty clear even looking at competitors the amc stock has overvalued from a fundamentals level
MOMENTUM TRADER OF AMC?
If you’re a momentum trader in this stock ( which i personally wouldn’t recommend) , you need to live and breathe the stock charts because that’s the only way you’re going to survive and looking at the stock charts right now it’s pretty clear the stock’s pretty in line with its moving average at the moment.
The stock can move sideways for a brief period of time but ultimately fundamentals do usually prevail in the end and then the stock could head south and it may head north before it may head back to these $60 level again. But it could head south again to around 10 per share or less so good luck guys.
THIS IS NOT financial advice.
Thank you guys so much for watching i wish you all luck in the markets and i hope you all have an incredible day and i’ll see you in my next video and they’re safe .
Software company palantir has recently purchased fifty million dollars worth of gold bullion. So should you be investing in gold in this video? You go to find out I’m going to dive into the gold price. The headlines and my valuation and by point for talented stuck to
this is going to be really exciting. Video guys who’d be sure to stick around all the way till the end, and I think you’ll like what I’ve got for you
Palantir has just bought Fifty million dollars in gold bars in august twenty twenty one, as it’s cash, pile, is grown to over two billion dollars. So this makes sense. Talents here is basically hedging. It’s cash position by pitch seeing some gold,
which is a traditional hedge against inflation. One of the major reasons- this is a major surprise, is the fact that many large technology companies now are actually buying bitcoin instead, which is being called the digital gold. As a hedge against inflation, we have pay pal, we have square, we have tesla they’ve all been buying bitcoin for the very same reasons as Palantir.
Despite been an advanced software company. Palantir has gone old school and bought gold. So is this a good deal for Palantir?
Bill gates is now the largest private farmland owner in the united states so should you be investing in farmland well in this video you guys are gonna find out i’m ben and welcome to motivation to invest i’m gonna dive into the headlines
the controversy surrounding bill gates
becoming the largest private farmland
owner in the united states we’re also
going to dive into whether farmland is a
productive asset and how you can invest
into farmland without owning a farm
straight from your phone or laptop so
this is going to be a really exciting
video guys and be sure to stick around
all the way until the end and i’m
actually going to reveal some details on
warren buffett’s secret son howard
buffett and he isn’t mentioned much in
the media but this guy is actually a
true farmer so there’s going to be a lot
of exciting stuff in this video it’s
going to be very impactful very
informative so stick around to the end
guys and i think you’ll like what i’ve
got for you before we hop right in if
you’re new around here feel free to join
the investing family by hitting that
subscribe button it’s completely for
free guys and turning that notification
bell on if you like more investing tips
and exclusive stock market picks and
analysis which i’m personally
investing into and with that being said
yeehaw and let’s dive in the controversy
over bill gates becoming the largest
private farmland owner in the united
states so the gates have acquired more
than
269 000 acres of farmland in the united
states in the past 10 years now those
purchases made with the help of the
washington-based firm cascade investment
and a number of shell companies include
farmland in nearly 20 states that
cultivate vegetables carrots soybeans
potatoes and some of which end up in
mcdonald’s french fries so when you’re
eating those mcdonald’s french fries
bill gates actually owns the land of
which those potatoes are created on now
this has caused a lot of controversy for
many reasons some people are saying he
who owns the land owns the food supply
has the power over the entire world and
it seems like bill gates does have a lot
of this farmland right now so that’s the
first major controversy the second major
controversy if with these billionaires
buying up all this farmland how will
this impact the market for actually
traditional farmers trying to buy a farm
and actually use it for actually farming
purposes so that’s the second major
controversy with bill gates but he’s not
the only billionaire bangla farmland
many other large financial firms have
sought to purchase agricultural land too
even if they have no involvement in the
day-to-day farming operation and i also
saw a recent interview where the
chairman of interactive brokers also has
been investing into a heap load of
farmland and of course he must be a
great investor other controversial
headlines have called bill gates
ownership of this vast amount of
farmland his empire of dirt i’d love to
hear your thoughts guys so please do
comment below do you think it’s a good
thing or a bad thing bill gates and
billionaires are buying up this farmland
or do you think it won’t really make
much difference to the day-to-day
operations of many of these farms and
the food supply of which we all love and
use now what’s interesting enough is
bill gates investment firm is also a
shareholder in plant-based protein
companies such as beyond meat which i’ve
covered many times on this channel and
impossible foods as well as agricultural
equipment maker john deere so it’s clear
bill gates is quite heavily involved in
the farming industry and we know that
bill gates is a great friend of the
great warren buffett and warren buffett
in almost every interview is always
talking about how great farmland is or
using it as some sort of analogy to see
how farmland is a good investment
compared to many other speculative
investments this could be cryptocurrency
even this could be gold warren buffett
loves farmland understand what you buy
now if you buy a farm you look at you
look at the farm and you say i expect to
get so many bushels per acre of corn or
soybeans and you figure out how much
that’ll be worth and then you figure out
what the price should be thus it’s clear
warren buffett loves farmland and
there’s good reason for this firstly
farmland is a productive asset and that
it actually produces food which
everybody needs secondly farmland is a
scarce resource as the old saying goes
by land because god isn’t making any
more of it price tends to increase over
time which is exactly what’s happened
with farmland over the last 20 years the
price of farmland per acre in the united
states has risen by an average of four
point five percent per year to four
thousand four hundred and forty two
dollars per acre we go back to 1997 the
price per acre farmland in the us was
1713 dollars per acre flash forward to
2020 4
442 per acre now getting that consistent
nearly five percent return each and
every year on a really stable asset like
farmland is a great investing
opportunity but this effect is amplified
on smaller markets where land is more
valuable if we take the uk for example
uk farmland prices have grown 17 400
percent since the 1930s so if we rewind
back to the 1930s the average price of
bear farmland in the uk was only 40
pounds per acre now this is a figure
which has since surged by 17 400 percent
to 7 000 pounds per acre during the
first quarter of
2021 so you can see even in countries
like the uk farmland is an amazingly
valuable asset if you guys have found
value so far in this video feel free to
give it a big thumbs up helps out
tremendously with the channel you can
see these celebrities here they’re sort
of old movie stars and they’re saying
give this video a thumbs up it helps out
with the youtube algorithm in addition
guys do you want to access exactly which
stocks i’m buying and selling in real
time my entire investment portfolio and
joining a thriving community of
investors then feel free to check out
that first link in the description below
for our ultimate investing strategy
course and vip group so here you get
access to our private discord group
which is thriving for members at the
moment
my advanced valuation models and my
stock research platform for over 46
different stocks but that’s not all guys
you get bonus six figure portfolio
updates you get stock portfolio tracker
and you also get 12 units to learn how
to be a great investor and ultimately
become financially free now this is not
some thousand dollar course guys
actually works out around 25 dollars per
month 25 30 per month on the annual
membership so it’s extremely cost
effective and i will be closing
memberships extremely soon in the next
48 hours so be sure to check out that
first link below if you don’t want to
miss out on that and now let’s get on to
warren buffett’s secret son
howard buffett how warren buffett’s son
would feed the world so this is howard
buffett here warren buffett’s son and
yes he’s a real life farmer now this is
no bs guys and you’re probably thinking
okay why is warren buffett’s son working
on a farm when his father is one of the
richest people on the planet once howard
settled on farming warren bought land
for him but then made his son pay rent
and tied it to his body weight
so if you gain weight your rent goes up
and if you lose weight the rent goes
down it’s something like that financial
incentives are supposed to work in some
things they don’t work very well in
weight incidentally but why wouldn’t you
just give your son a farm
well i just don’t think that’s the you
know the way to bring up a son i mean i
don’t think i don’t think he’s entitled
to be given a farm just because his last
name is buffett so he’s tied the rent to
the farm to his son’s weight now it’s
clear warren buffett is just an
exceptional businessman okay so what are
four ways to invest into farmland well
i’m gonna hop in right here guys and
display them to you right now so the
first we’ll hop into right here is farm
reits so a farming focus reit is a real
estate investment trust now some
examples include farmland partners
incorporated fpi and gladstone land
corporation with the ticker land l-a-n-d
second method of investing into farmland
without owning a farm is to invest
directly into crop production via
agricultural stock so you could invest
in stocks like fresh del monte produce
okay so the third way of investing into
farmland without owning a farm is to
invest into an agricultural etf or
exchange traded fund and a great example
of this is the market vectors agree
business etf with the ticker symbol
m-o-o or moo which obviously stands for
the cow
however the best-performing agricultural
commodity etf based on performance over
2020 is the tucrium soya bean etf with
the ticker s o y b or soy b now this is
just a personal theory on this but i
believe that performance was actually
increased because soybeans in actual
produce is becoming immensely more
popular if you look at most plant-based
alternatives to meat they actually
contain soya this could be plant-based
sausages plant-based burgers this could
be just tofu it all contains soya beans
so it clear soybeans are becoming a lot
more popular as plant-based diets are
also becoming a lot more popular and the
fourth and final way of investing into
farmland indirectly is to invest
directly into soft commodities so you
could invest into corn you could invest
into livestock you can invest into
grains cocoa and much much more a great
etf which covers many of these
commodities is the investico db
agricultural etf with a ticker dba and
this invests into corn wheat soybeans
and sugar future contract so it’s clear
you can be like bill gates too and also
invest into farmland but remember guys
this is not financial advice and
remember guys if you do want to check
out that first link in the description
below for our ultimate investing
strategy course or the second link below
for our vip membership group where you
can access all the previously mentioned
including my buy and sell signals and my
entire investment portfolio with that
being said if you guys haven’t joined
the investing family yet you can hit
that subscribe button turn that
notification bell on and i hope you guys
all have an incredible day and i’ll see
you in my next video investig
hey everyone ben here and welcome to motivation to invest today we’re going to be joined by a legendary former hedge fund manager large crojo and he’s also the author of two books on investing we’ve got investing demystified and confessions of a hedge fund manager so lars is incredibly well educated with an mba from harvard business school and in this video lars is going to give us some insight into what it’s like managing a hedge fund and hopefully some investing tips to help you guys get great returns in the market why don’t you tell us a little bit about your background and why you got started investing what was your motivation to invest well my background.
i’m danish um
but i haven’t lived there for over 30
years so i went to school
undergraduate and graduate school in uh
in the u.s at harvard uh and ended up on
wall street frankly originally because i
had a lot of debt from university and
they paid really well so i ended up
working as an investment banker for a
short while and then after a business
school
is really when i got into um
investing originally i had looked at
doing private equity because i did my
internship in private equity actually in
london funnily enough but i ended up
choosing
hedge funds because i i took the view
a bit silly in hindsight but
that if you worked in private equity on
many portions of investing the
overwhelming driver of how well you did
was depending on something that you
really had no insight into or control
over namely the movement of the markets
so i thought if you invested in as a
even a real estate investor but also
private equity over a 10 15 year horizon
first of all you did fairly few
transactions and second of all if the
world economy went to then
that was going to be a major driver of
your uh profitability in the coming
decade meanwhile in hedge funds it’s
sort of in the in the term right you
could hedge so your ability to perform
was not depending on any one thing
because whatever you didn’t understand
or didn’t like you could hedge and make
go away the reason i say this is a
little bit silly was i graduated
business school in 98
which was the beginning of the internet
boom yeah and one of the greatest bull
markets in the coming decades and you
know someone my best friend in the world
is president of one of the world’s
largest private equity firms and you
know he’s done okay as well right so
so it’s not uh you know it’s not like uh
uh you know that that was necessarily in
hindsight
the most clever choice but yeah that’s
how i ended up in hedge funds
that makes so you got into hedge funds
just as the dot-com bubble was sort of
just about to peak is that right
yeah i’m the guy who you know
immediately graded harvard business
school in 98. it just if you look at the
number of people from that era that went
to silicon valley and later did
phenomenally well
been one of the greatest things of my
career is to be close to a lot of those
folks and see how they operate and
frankly learn from it and contribute to
it do you have any tips for anyone who’d
like to start maybe a hedge fund or
start managing
money it’s a bit like when you write a
book frankly everyone says oh i want to
write a book yeah
everyone says i want to run a hedge fund
so let’s say what does it take to start
a hedge fund well what is a hedge fund
it’s an investment phone it’s a it’s a
pool of assets right so the reason it’s
called a fund is because there is a fund
sitting somewhere
and i know you’re in manchester but
let’s say how would you run a hedge fund
if you want to start a hedge fund right
now well first of all you have to go get
regulated in in the uk by the financial
conduct authority that’s that’s
for good reason that’s serious stuff
right
um and then you have to set up this fund
but when you think of where is the fund
well it depends a little bit on who are
your investors very often hedge funds
sit in one of these
tax exile places cayman islands bbi
places like that and people naturally
associate that with something dodgy
that’s not the case
it’s because that is think of it this
way that’s where investors from all over
the world can put the assets and only be
taxed while they take it back to one of
them if you have an investor in in from
from
uh brazil well it’s easy for that
investor to invest in a cayman island
fund that’s into a manchester front
yeah reasons go into but
then what if you sitting in manchester
do you’re actually an advisory business
that advises that fund that’s
so in a sense and for that you get paid
a fee so that’s where you make big bucks
right so so what do you need to do to do
that well so you set up this fund and
there are about a million people that
wear expensive suits that can help you
that for a large amount of money um but
then the real trick is can you get
anyone to invest in your fun you know
what do you plan to do yeah how are you
going to convince people
how are you going to convince them not
just the next who’s trying on a
get rich quick team which a lot of
people are yeah um
how are you going to cover all those
costs that you’re not going to
have covered by your investors uh yeah
and it’s it’s substantial
yeah and then
once you get all of that together
then um
you guys you gotta invest the money and
then you use the returns from those
investments hopefully you raise more
money and if you do it successfully over
quite a while
you can eventually run a ton of money
and
and
be very successful but failure rate is
very high hedge funds like many other
businesses are you know we tend to talk
about the winners we tend to talk about
yeah the the
the tiger or the citadels or the whoever
they are
and we sometimes forget that there are
perhaps
10 12 000 hedge funds out there might be
500 that have done really really well
and 50 that have done astronomically
well right and a lot of those guys they
started out tiny so what do you need you
need some money to set up the fund and
all the expenses associated with then
you need some investors then you need to
go invest that money and and produce
returns and for that you’ll get paid
incredible fees if you do really well
and then yes you you can go buy that
yacht if you yeah
that’s what makes you happy i feel even
to be a great investor if you’re really
motivated by materialistic things and
you’re not just motivated by the actual
act of doing the craft of investing then
i feel your returns will be less most
likely from just a lot of the great
investors i’ve studied like even if you
look at warren buffett how he lives and
he still studies companies and invests
and sits there’s the same house same car
goes to mcdonald’s get his mcdonald’s
breakfast like he’s very humble really
for somebody who’s worth billions
misconception really with a lot of hedge
funds and you see like like wolf of wall
street and by the way i’ve met him
through a weird set of coincidence when
i was just out of business school very
funny oh you met jordan belford
well he interviewed me i didn’t know
but
um he wasn’t really a hedge fund brother
first of all oh yeah he’s a brokerage
wasn’t he yeah yeah and a fraud right
that’s not yeah yeah yeah
um
but look i think first of all like
hopefully
you know successful hedge fund managers
tend to be
well-informed well-educated people and
hopefully those people have choice in
their careers they don’t have to be
hedge fund management really
those people that choose to be hedge
fund managers do it for the love of the
work because they have yeah it’s
certainly i agree with you very very
much that the people that do better in
the long run are the ones that just love
the work mm-hmm yeah i mean warren
buffett could have stopped investing
money probably 50 years ago and he would
yeah could have put the lifestyle on
your list yeah exactly
yeah
and you know it’s just a lot of those
people could have stopped running money
when they were 30. yeah yeah they just
love what they do some of them probably
also caught up in the rat race the ones
that i know that have done the best they
just love it
they get up saturday morning and they
wish the markets were open yeah yeah
when they go to the beach they bring an
annual report yeah yeah yeah they’re the
kind of people where if you have dinner
with them they can’t shut up about
trades
yeah reflective on my own career i
didn’t love it as much as those guys
yeah yeah
it was so easy for me to walk away
yeah and and also one of the reasons why
the very first thing i said was it was
interesting because i graduated from a
prestigious school at a time
of a great beginning of a great run
sort of suggesting well maybe i
shouldn’t have done it right so it’s
kind of you compare that to people that
just live and breed investments yeah
if with your fund let’s go back to your
phone then but how many assets did you
have under management approximately
well so we were at a
we were at a billion dollars in uh
invested capital when we okay which also
i mean coming back to your argument
about it’s a lot of money to throw
around cheers that’s been great stuff
and comment your thoughts below guys if
you have any thoughts any questions for
laws because um we’d love to hear from
you guys if you did find value in this
video feel free to give it a big thumbs
up and with that being said if you
haven’t joined the investing family yet
feel free by hitting that subscribe
button turning that notification bell on
first link in the description below for
our vip membership group and also our
ultimate investing strategy course and
with that being said thank you guys so
much for watching i hope you all have an
incredible day and i’ll see you in my
next video invest safe
[Music]
you
