The pace of portfolio changes will pick up as we close out 2021 and prepare to put more wood behind some of our thematic arrows. I’m also pushing the investment horizon out to enable us to look past what are some very high current valuations.
We also have some names that have been in the portfolio so long it’s a stretch to consider them “recently public” and we’re just pushing them out of the next to make room for new names.
First of all some names we are taking out of the portfolio as “graduates” given how long we’ve owned them:
- Avalara (AVLR) – This has been a solid e-commerce infrastucture name but it’s pretty mature now with a $15B market cap and doesn’t fit into any of our new emerging themes.
- Hubspot (HUBS) – This one has really grown up and at $38B it’s time to move on. I suspect they will remain a strong player in SMB sales, marketing and social networking. Facebook’s (FB) shift into the metaverse may actually help them gain share if businesses decide they want to keep their operations in the IRL segment.
- Twilio (TWLO) – We picked this one up at just the right time and were pleased that many of our readers did too afte rreading Time to Buy Twilio back in January of 2017 with the stock at $32(!). They are still in a great position here at $285/share and a $50B market cap. This one graduates cum laude.
- DocuSign (DOCU) is our final graduate. This one was a pretty obvious buy right from the start and continues to be well positioned in the enterprise e-commerce segment. Nothing wrong with the story here but they are well established with a $55B market cap.
Goosehead Insurance (GSHD) is a great company and it’s been a strong performer. But now it seems a little dull in the world we are living in. I have nothing against boring stocks (heck one of my biggest positions in the real-money portfolio is AerSale (ASLE) which maintains and supplies used commercial aircraft) but the bar is higher here in the IPO Candy MP. GSHD stock is up close to 400% over the last 3 years.
I am removing DraftKings (DKNG) because I have never been able to get comfortable with the management team and the direction of the business. Sports entertainment and betting will certainly continue to expand and we’re following the sector closely. DraftKings will be revisited along with all the other newly public names including Sports Genius (GENI) and Sportsradar (SRAD) which are two that I also like.
Now that some room has been made we’re ready to add some fresh names on Monday, November 1st to begin to position things for 2022 and beyond.
An image of the changes is below and included as a downloadable PDF.