Happy Sunday.
First and foremost, we want to apologize for the radio silence this week.
Due to unforeseen personal matters we were forced to skip this week’s “The Investing Week Ahead.” And what an insane week to have skipped, right? This week was the Super Bowl of the stock market!
Regardless, let’s jump into the review.
Katie Stockton and I will be hosting yet another webinar together this week!
In case you all aren’t familiar with Katie Stockton, she’s what I describe as a “Technical Analysis Wizard!” As you all know, I look at the fundamentals of a company (revenue, profits, growth, etc.) whereas Katie instead focuses solely on the price action of the stock — trying to predict where it might head in the near-to-medium term.
Together, we’re able to deliver to you all incredible fundamentally sound stock ideas — as well as the “best prices” to buy these names at.
As you all might remember from October’s webinar, I shared my deep conviction for Shopify, Broadcom, and Amazon as great fundamental stocks to buy. Katie then shares her own price targets and buying opportunities if we saw weakness.
Since October, these three names exceeded our expectations — having climbed by +55%, 36%, and 29%, respectively. Tuesday’s webinar will include three more stock ideas — but you can only attend if you’re a subscriber to her Substack (or on a free trial).
Can’t wait to see y’all there!
Portfolio Updates:
The portfolio remained largely the same in January, having only invested $1,372 toward the above strategy. As shared in the last couple of weeks, my goal for the month was to deploy capital toward my cryptocurrency portfolio (shown below).
This portfolio saw about $8K worth of inflows during the month, helping me inch closer to $100K in value.
An interesting chart I found on X.com over the week is shared below. Essentially it’s trying to prove “Chainlink price action precedes Bitcoin's.” If this correlation is indeed true, we should begin to see Bitcoin push higher as we enter Q2 in the coming several weeks.
I’ve already deposited $19K into my Robinhood account to purchase another 100 shares of Tesla stock at market open Monday. This will bring my total investment to 200 shares — allowing me to write two covered call option contracts against the position.
These two contracts will allow me to generate ~$2,050 in premium income every 6-weeks or so — drastically increasing my monthly passive income to ~$2,300 (when including dividend averages from my investments).
IMPORTANT: Expect a post this week about a new ETF I’m very excited about that sells covered call option contracts against the Nasdaq-100, aiming to generate a 14% annual yield on invested capital without cannibalizing the share price.
Stay tuned!
Week in Review — Too Long, Didn’t Read:
Meta initiates a quarterly dividend, Microsoft’s margins continue to expand, Google’s GCP is hitting stride, Apple delivered mixed guidance, Amazon is testing grocery again, FanDuel entered the American markets, a regional bank’s sketchy earnings report, a quick layoffs update, interest rate cuts are now projected to be closer to the summer, and the very solid jobs report may support the Fed’s willingness to wait.
Key Earnings Announcements:
Meta initiates a quarterly dividend, Microsoft’s margins continue to expand, Google’s GCP is hitting stride, Apple delivered mixed guidance, and Amazon is testing grocery again.
Meta Platforms (META)
Key Metrics
Revenue: $40.1 billion, an increase of +25% YoY
Operating Income: $16.4 billion, an increase of +156% YoY
Profits: $14.0 billion, an increase of +201% YoY
Earnings Release Callout
“Today, Meta's board of directors declared a cash dividend of $0.50 per share of our outstanding common stock (including both Class A common stock and Class B common stock), payable on March 26, 2024 to stockholders of record as of the close of business on February 22, 2024. We intend to pay a cash dividend on a quarterly basis going forward, subject to market conditions and approval by our board of directors.”
My Takeaway
WOW! I’m losing my mind right now — not only did Meta absolutely blow their earnings out of the water (as predicted 3 weeks ago here), but they’re also initiating a quarterly dividend! Am I dreaming?
Their stock price has risen +30% in the last 3 weeks, and my portfolio is very happy about it. Let’s jump into the numbers…
Meta delivered revenue and profits +3% and +11% above expectations, respectively. The company also guided to Q1 figures substantially higher than expected — as the company is growing faster than anticipated in the digital ad industry for a second year in a row now. Q1 guidance implies +28% ad revenue growth at the high end, and suggests that the company could deliver an incremental +$10B in revenue above 2024’s previous expectations.
With that being said, the company finally addressed Temu’s competition (TikTok Shop) — explaining that Temu likely only did $2B in revenue in 2023 and this shouldn’t impact their business materially in 2024.
The biggest highlight, of course, were their return of capital programs — buyback authorization is now $50B in size alongside their newly issued quarterly dividend. I couldn’t be more excited about this company in 2024. And for those of you asking yourselves “Is it too late?” Just look below.
Microsoft (MSFT)