Cryptocurrencies, Millennials and Stocks

Dear Reader,

Bitcoin and cryptocurrencies' boom in general started toward the end on 2015. Millennials, or people born between 1981 to 1996 embraced cryptocurrencies and started trading cryptocurrencies and helped cryptocurrencies rise to record highs in 2017 and are now one of the main driving forces behind the recent run up in Bitcoin and other cryptocurrencies' prices.

After the cryptocurrencies' prices crashed in 2018 many millennials used their recently acquired knowledge on cryptocurrencies and went on to start investing in common stocks of listed companies.

The similarities between cryptocurrencies and stocks are stark. Most cryptocurrencies issued by companies depend on the success of projects of the underlying companies or the companies themselves. One basically has to analyze the financial statements of the companies, much the same way one analyses companies in order to successfully invest in their stocks.

The recent run up in the prices of cryptocurrencies and stocks is due to a large extent to millennials investing. Millennials continue to invest even more money in cryptocurrencies and stocks, so the run up in prices of stocks and cryptocurrencies could continue for several more months.

But, basically, we are in a bubble of stocks and cryptocurrencies driven by technology. However, out of the soon to come crash and chaos new technologies and technology leaders will emerge much like Amazon and Google after the dot-com boom and subsequent crash.

Disclaimer: The blogposts and comments on this blog and posts on social networks(Twitter, LinkedIn, Facebook etc.) are not investment recommendation, are provided solely for informational purposes, and do not constitute an offer or solicitation to buy or sell any securities. The opinions expressed on the blog are Petar Posledovich's. Petar Posledovich does not guarantee the accuracy of the information presented on this blog and social networks. The information presented is "as is".

Petar Vladimirov Posledovich is not liable for any investment losses incurred by reading and interpreting blogposts on this blog and posts on social networks.

Conflicts of interest: I may possess some of the securities, currencies or their derivatives mentioned in the blogpost and posts on social networks(Twitter, LinkedIn etc.)!

Respectfully yours,

Petar Posledovich

Palantir Prospects. A 22 October Update

Dear Reader,

Palantir Technologies Inc, the artificial intelligence product and service company, recently doubled its market price since its recent IPO.

I forecast Palantir could easily further double its market capitalization within two years. Artificial intelligence is the most promising future technology. We are in in the midst of the fourth industrial revolution where algorithms guided by artificial intelligence are replacing more and more manual labor.

Palantir is at the crest of this new technology wave offering both scalable artificial intelligence products and tailor made services. The company has many contracts with the US government and other corporations. Its revenue is growing with approximately 50 % year on year. Other technology companies like Zoom Video are trading at much higher Price/Sales multiples than Palantir, which means Palantir could further grow into a higher valuation.

Yes, Palantir is heavily loss making, but if the company goes on increasing its revenue by more than 40 % profitability will soon come.

All in all I regard Palantir as 50 % undervalued within the next 1 year, barring a stock market crash lead by the Nasdaq Composite and mainly technology companies.

Disclaimer: The blogposts and comments on this blog and posts on social networks(Twitter, LinkedIn, Facebook etc.) are not investment recommendation, are provided solely for informational purposes, and do not constitute an offer or solicitation to buy or sell any securities. The opinions expressed on the blog are Petar Posledovich's. Petar Posledovich does not guarantee the accuracy of the information presented on this blog and social networks. The information presented is "as is".

Petar Vladimirov Posledovich is not liable for any investment losses incurred by reading and interpreting blogposts on this blog and posts on social networks.

Conflicts of interest: I may possess some of the securities, currencies or their derivatives mentioned in the blogpost and posts on social networks(Twitter, LinkedIn etc.)!

Respectfully yours,

Petar Posledovich

Cryptocurrencies and the Coronavirus

Dear Reader,

Bitcoin has staged a remarkable rally year to date up 156.7% in 2020 making Bitcoin the best performing major asset class year to date

I think the main reason behind the price increase is that because of social distancing people are using more Bitcoins as means of payment, store of value or unit of account or with other words - money. Yes, there are of course the speculators who in anticipation of this increased Bitcoin usage wave bought in and drove and continue to drive up the price of Bitcoins.

What is more, other cryptocurrencies are doing well influenced by the significant rise of Bitcoin. Cryptocurrencies are here to stay. One of the factors contributing to the rise of Bitcoin and other cryptocurrencies is that governments and central banks are becoming more and more light touch in regulating cryptocurrencies.

The future belongs to automation, algorithms and computing power. The fourth industrial revolution driven by artificial intelligence is upon us. Cryptocurrencies are riding this wave by easing payments, money transfer and ultimately investing. 

Bitcoin could easily go to 30 000 USD in 2021. It will be interesting whether the end of the coronavirus would crash Bitcoin's and other cryptocurrencies' prices. My forecast is that the correction of Bitcoin when the coronavirus ends will not be that deep, not more than 30 % - 40 % .

Disclaimer: The blogposts and comments on this blog and posts on social networks(Twitter, LinkedIn, Facebook etc.) are not investment recommendation, are provided solely for informational purposes, and do not constitute an offer or solicitation to buy or sell any securities. The opinions expressed on the blog are Petar Posledovich's. Petar Posledovich does not guarantee the accuracy of the information presented on this blog and social networks. The information presented is "as is".

Petar Vladimirov Posledovich is not liable for any investment losses incurred by reading and interpreting blogposts on this blog and posts on social networks.

Conflicts of interest: I may possess some of the securities, currencies or their derivatives mentioned in the blogpost and posts on social networks(Twitter, LinkedIn etc.)!

Respectfully yours,

Petar Posledovich

Moderna Valuation

Dear Reader,

Currently the pharmaceutical company Moderna Inc is valued at 38.56 billion USD.

Moderna is the famous maker of coronavirus vaccine that also received a large sum of money from the US government to help it develop the vaccine. So far, Moderna's vaccine has shown the highest success rate of 95% and is already in late stage testing.

The USA and Europe have preliminary contracts with Moderna for the vaccine.

I think Moderna is worth 120 billion USD given the potential of its coronavirus vaccine. Yes, there are around 8 major other vaccines in late stage development or even in use, but Moderna's seems the most promising along with Pfizer's.

Actually the coronavirus could further mutate which can make Moderna's mRNA technology even more valuable in future vaccine development. Actually, the messenger RNA  has huge potential for future development of medications for the major diseases of our time.

Disclaimer: The blogposts and comments on this blog and posts on social networks(Twitter, LinkedIn, Facebook etc.) are not investment recommendation, are provided solely for informational purposes, and do not constitute an offer or solicitation to buy or sell any securities. The opinions expressed on the blog are Petar Posledovich's. Petar Posledovich does not guarantee the accuracy of the information presented on this blog and social networks. The information presented is "as is".

Petar Vladimirov Posledovich is not liable for any investment losses incurred by reading and interpreting blogposts on this blog and posts on social networks.

Conflicts of interest: I may possess some of the securities, currencies or their derivatives mentioned in the blogpost and posts on social networks(Twitter, LinkedIn etc.)!

Respectfully yours,

Petar Posledovich

Does the Coronavirus Vaccine News Change the Stock Market Environment?

Dear Reader,

This week a news on coronavirus vaccine developed by Pfizer and BioNTech seemed to change the near term stock market environment .

Investors sold stay-at-home winners stocks like Zoom Video, Peloton Interactive, Docusign Inc etc. and bought into value stocks like oil production and exploration stocks, commodities producers, industrials and financials.

Is the change in the stock market temporary or permanent? 

I think it is permanent, if the virus does not mutate or the vaccine fails. Yes, Zoom Video, Peloton and Docusign will be worth much less soon. However, if the coronavirus mutates or the vaccine proves ineffective the aforementioned stocks will experience a resurgence.

For the moment, the digital transformation is still going. However, the coronavirus vaccine news definitely slowed the pace of digital transformation. I still see Facebook challengers as Snap, Snapchat application maker, and Pinterest benefiting. The new social interaction is now done in front of the personal computer, the tablet or the smartphone. So social applications like Facebook, Snapchat, produced by Snap Inc, and Pinterest and the stocks of their parent companies will continue to benefit.

Usually, investing in biotechnology stocks is a binary event. You either win a lot or you loose a lot, depending on the approval by the United States Food and Drug Administration agency and later success of the medication. The current stock market situation is vey similar to a binary event. If a coronavirus vaccine is developed and the coronavirus does not mutate, oil and other commodities producers, industrials and financial stocks will rise a lot along with improvement in the economy. Technology stocks will benefit in both situations actually. Technology stocks are a leveraged play on the economy since they require very little capital to be operational, to start off. A coronavirus mutation along with a new economic recession will speed up digital transformation and technology stocks like Zoom Video, Peloton, Docusign etc. in particular, will again benefit. Most other technology stocks will also benefit. If the coronavirus vaccine proves effective, the economy will burst into fast, be it temporary, growth and technology stocks will again benefit.

All said, we are in the fourth industrial revolution of artificial intelligence and technology stocks seem to be winners in almost all possible situations. However, if artificial intelligence does not rise to the occasion and disappoints the very high expectations the world has for it the Nasdaq composite and most technology stocks can fall more than 60 %.

Disclaimer: The blogposts and comments on this blog and posts on social networks(Twitter, LinkedIn, Facebook etc.) are not investment recommendation, are provided solely for informational purposes, and do not constitute an offer or solicitation to buy or sell any securities. The opinions expressed on the blog are Petar Posledovich's. Petar Posledovich does not guarantee the accuracy of the information presented on this blog and social networks. The information presented is "as is".

Petar Vladimirov Posledovich is not liable for any investment losses incurred by reading and interpreting blogposts on this blog and posts on social networks.

Conflicts of interest: I may possess some of the securities, currencies or their derivatives mentioned in the blogpost and posts on social networks(Twitter, LinkedIn etc.)!

Respectfully yours,

Petar Posledovich

Cryptocurrencies Stocks Investment Opportunites

Dear Reader,

Cryptocurrencies are the best performing major asset class year to date.

The problem with cryptocurrencies is that they are not very liquid, so the major cryptocurrency investors are individuals. This makes cryptocurrencies much more volatile than stocks.

One way to both diminish the volatility of cryptocurrencies and benefit from the huge future promise of cryptocurrencies is to invest in common stocks of listed technology companies that stand to benefit from the cryptocurrencies boom.

Such stocks are AMD, Microsoft, Intel, Apple and many microprocessor chips producers. To produce or mine bitcoins one needs huge computing power. That is why computer and graphic chip producers like AMD are seeing huge demand for their products. AMD much more than Intel, since AMD is a low cost microprocessors producers. Since its recent low in 2015 AMD's stock is up more than 50 times driven by the cryptocurrencies boom. Microsoft sells Microsoft Windows, which is the operating system powering most computers and also large part of its stock appreciation is due to cryptocurrencies. Apple designs personal computers and now even designs its own microprocessor chips, so Apple also benefits a lot from the boom in computer power demand.  Intel designs the chips in most computers and, but since its chips are more expensive it has benefited less from cryptocurrencies.

Actually, the cryptocurrencies boom has much more to run in the future. Cryptocurrencies will profoundly change finance and will make it more accessible.

Disclaimer: The blogposts and comments on this blog and posts on social networks(Twitter, LinkedIn, Facebook etc.) are not investment recommendation, are provided solely for informational purposes, and do not constitute an offer or solicitation to buy or sell any securities. The opinions expressed on the blog are Petar Posledovich's. Petar Posledovich does not guarantee the accuracy of the information presented on this blog and social networks. The information presented is "as is".

Petar Vladimirov Posledovich is not liable for any investment losses incurred by reading and interpreting blogposts on this blog and posts on social networks.

Conflicts of interest: I may possess some of the securities, currencies or their derivatives mentioned in the blogpost and posts on social networks(Twitter, LinkedIn etc.)!

Respectfully yours,

Petar Posledovich

Scenarios Under Which Tesla Could Justify Its Current Market Capitalization

Dear Reader,

Tesla, the electric vehicle automaker, has currently a market capitalization of 407.550 billion USD.

Basically, the single scenario in which Tesla can grow sales and possibly profits into such a valuation is that Tesla becomes the dominant by far automobile manufacturer in the world.

The market seems to be pricing such expectations for Tesla. The route to car production dominance for Tesla goes through electric car future. Currently electric cars are a very small portion of the overall market. As even Elon Musk admitted recently Tesla was on one month away from bankruptcy not long ago. 

Yes, Tesla has a competitive advantage in electric car manufacturing. It is quite ahead in electric vehicle technology from its main competitors like Volkswagen and Toyota. But to grow into its current market capitalization Tesla has to win something like 30-50% of the global automobile market. The problem with electric cars is that they are currently too expensive to produce, because they contain a lot of ferrous metals, which currently makes electric vehicle production loss making. Even conventional combustion engine automobiles are produced with very thin net profit margins. Tesla has to achieve a technological breakthrough to live up to the current promises built into its stock price. If Tesla makes a quantum leap in electric vehicle production technology the company will achieve a healthy net profit margin.

The high market capitalization of Tesla has certainly bought the company some time. Will Tesla achieve its high goals? I think Tesla will be worth around 70 billion USD in the long-term. With other words, Tesla's stock currently is a bubble. Many bubbles like Fitbit, Groupon, DDD, GoPro have already burst.

Tesla's current technology is valuable, though. That is why I think Tesla is still worth 70 billion USD in the long term, 5-10 years on, which is still a lot of money.

Disclaimer: The blogposts and comments on this blog and posts on social networks(Twitter, LinkedIn, Facebook etc.) are not investment recommendation, are provided solely for informational purposes, and do not constitute an offer or solicitation to buy or sell any securities. The opinions expressed on the blog are Petar Posledovich's. Petar Posledovich does not guarantee the accuracy of the information presented on this blog and social networks. The information presented is "as is".

Petar Vladimirov Posledovich is not liable for any investment losses incurred by reading and interpreting blogposts on this blog and posts on social networks.

Conflicts of interest: I may possess some of the securities, currencies or their derivatives mentioned in the blogpost and posts on social networks(Twitter, LinkedIn etc.)!

Respectfully yours,

Petar Posledovich

Can a New Lockdown Lead to a Stock Market Crash?

Dear Reader,

A new economic lockdown in the USA will almost certainly crash the major US stock market indices by more than 30%. The Nasdaq composite could fall more than 40 % even.

Why? Even as things stand US stocks, technology stocks especially, are overvalued. For US technology companies the investing public is rightly assuming that the coronavirus will speed up digital transformation and technology corporations will ultimately achieve higher profits and revenues. But much like during the dot-com boom and subsequent bust the market is assuming the profits and revenue increases will come sooner and in bigger sizes than possible.

That is why technology stocks in the US are grossly overvalued as of this moment. Yes, in 5 to 10 years the US technology companies could grow into their valuations, but a new lockdown could crash the DJIA, S&P 500 and the Nasdaq Composite by 30% or even more. 

And the coronavirus could force both Trump or Biden to lock down the economy, no matter the short-term economic consequences.

Disclaimer: The blogposts and comments on this blog and posts on social networks(Twitter, LinkedIn, Facebook etc.) are not investment recommendation, are provided solely for informational purposes, and do not constitute an offer or solicitation to buy or sell any securities. The opinions expressed on the blog are Petar Posledovich's. Petar Posledovich does not guarantee the accuracy of the information presented on this blog and social networks. The information presented is "as is".

Petar Vladimirov Posledovich is not liable for any investment losses incurred by reading and interpreting blogposts on this blog and posts on social networks.

Conflicts of interest: I may possess some of the securities, currencies or their derivatives mentioned in the blogpost and posts on social networks(Twitter, LinkedIn etc.)!

Respectfully yours,

Petar Posledovich