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Table of Contents
About The List
- A stock will only go up if there is demand for the stock that outstrips the supply. And a stock, in the medium to long term, will only be in demand if investors feel/see that the prospects for growing revenue are good.
- The stocks that I am presenting here are about to enter that phase where the demand will start to increase because people are now beginning to see/understand that the prospects for growing revenue are good. And they will begin to see it due to the catalysts that I will point to. That’s my simple thesis that I have stuck to for years. It hasn’t been 100% fool proof ( nothing is) But it has worked well enough for me ( and countless others) to keep doing it.
- I decided to keep this as simple as possible and skip the charts and data tables etc since this is 2021 and you can easily find that data. You will notice that there is very little reference to current revenues etc. This is deliberate because the focus is on the potential for future revenue growth based on the company’s value proposition and the total addressable market size. Simply put, all we care about are companies doing new things ( or doing old things in a new way) that will change an industry and become a leader in the space.
- Catalysts are specific to this year; this first quarter in particular as we are looking to these catalysts to kick off the run for the year.
- Do your Own Due Diligence because I may be wrong about all of this. I have posted links to the info, where relevant, so you can do your own research. If you are going to hold something for 12 months or more you will need to have conviction because there will be some huge shakeouts along the way and the only way to build conviction is to know the company well and know why you own it. Simple.
- Set Your Own Stops: Risk/Stop loss levels are based on what my account can sustain. You need to decide what your own max risk is and implement it.
Stock: Nanox Imaging (NNOX) Current Price: 72.02
Why I like It:
The Product/Tech: Nanox is seeking to revolutionize the Medical Imaging space. There has been no significant improvement in the way X-Rays are done in 100 years. Nanox is seeking to replace Analog digital imaging with its own game changing technology.
The Opportunity/Market: The medical imaging market is worth around $29 billion and with its better tech and lower cost basis I Can see NNOX carving out a decent chunk of this overtime. I also like the fact there will be a SAAS component that will ensure not only unit sales but recurring revenue.
The Team: The execs at the company are well equipped to carry out the task of building and selling this product with an awesome mix of Scientific, Management and financial pedigree. These are some of Israel’s best and brightest minds who have already achieved a lot in prior ventures.
The Catalyst(s): The main reason I am thinking Nanox will outperform this year is because it is expecting a full FDA approval in Q1 2021 so they can ramp up production and start shipping units this year.
When Am I Buying Nanox: If you are an IVtrades trader, specifically a part of the Mentorship group, then you will know that I have been buying NNOX since around the 35.00 level.
and I will be adding to the position in coming weeks and will also be getting some JAN 2022 100.00 Leaps. I want to get my fills below 85.00 and will hold for ~ 12 months or a break below the $50 level or if they fail to secure FDA approval. I think it can see $150 on FDA green light.
About the Company:
About the product/technology:
Company Financials *pre-revenue:
The Medical Imaging Industry Stats:
Stock: Palantir (PLTR) Current Price: 36.30
Why I like It:
The Product/Tech: PLTR is taking data collection, analysis and visualization to a whole new level. The proprietary software that the company possesses has aided the military, various gov’t agencies and an increasing number of big corporations to make better sense of their data and craft successful/profitable strategies. If they can continue to execute, they will become part of every major entity’s decision making process.
The Opportunity/Market: I think PLTR is still misunderstood by the mainstream analysts who still think it is just a “tech/software company”. Personally, I think PLTR is really a global consultancy firm and its real competitors are the Mckinseys, Mercers & Accentures of the world. They can do the same things these firms do 100x better and 100X faster and that market is worth $133 billion and PLTR is just getting started.
The Team: The founders of Palantir include Peter Theil and Alex Karp. Theil needs no introduction as his pedigree and track record are well known. As for Karp, he also has a track record of successful investments in startups and lives and breathes data science. They have assembled a team of professionals to drive PLTR forward.
The Catalyst(s): As i mentioned, I think analysts don’t quite understand this company and where the bulk of its revenue will come from. PLTR has been inking a record number of contracts and once they report earnings, the real customer base will be apparent and the narrative will change, and so will the valuation.
When Am I Buying PLTR: I already own some PLTR common and JAN 2022 Calls and I recently liquidated some underperforming REITs so i can double my PLTR allocation with one buy before earnings and one more after the lock up expiration. These new buys will be all common. No leaps. I will cut PLTR if it trades below 20.00 and I am thinking we could see a 105.00 print by year end.
About the Company: https://www.palantir.com/about/
About the Product: https://youtu.be/jgj6FYghPh8
Company Financials: https://www.morningstar.com/stocks/xnys/pltr/ownership
Industry Stats: https://bit.ly/3owUqV4
Stock: Desktop Metals (DM) Current Price: 22.80
Why I like It:
The Product/Tech: 3D Printing had a bit of a false start around 2013-2014 and the stocks got way ahead of customer/market adoption. Well the market place is finally ready and it is largely due to the type of 3D printing technology that DM is bringing to the market. In fact, DM’s process is the fastest in the market….by a mile and seems to be gaining traction quickly among engineers and designers.
The Opportunity/Market: The 3d printing market is still in its infancy but, as more industries start to use 3d printing for prototyping and eventually manufacturing, the market is expected to grow to $34 billion by 2024. It is hard to see a scenario where the company with the fastest and lowest cost machines doesn’t take the bulk of the market share.
The Team: One of the co-founders of the company, Ely Sachs, is actually the pioneer of 3D Printing. He has teamed up with other scientists in the field and, along with the management/financial backing of the group that brought the company public ( was a SPAC merger), I can’t imagine a more qualified team.
The Catalyst(s): Earlier this month, DM announced that they acquired a company called EnvisionTEC. Envision is the leader in Additive Polymers and has a customer base of ~ 5000 as well as tons of patents. When DM reports earnings next month it will most likely give guidance that will include the revenue that will be flow from the Envision roll up. For those who aren’t paying attention, this may be a surprise guide up and the reaction may give the stock the push it needs to run in 2021.
When Am I Buying DM: I think the stock will take some time to base/consolidate under the 27.50 level before retesting the highs and I want to have a position on before that. So I will start to buy some common next week and will also pick up some January 2022 25.00 Calls. I will throw in the towel if trades below 16.00. And I am thinking it could comfortably trade 45-50 by year end, all things being equal.
About the company/Product: https://www.desktopmetal.com/about-us
Industry Stats: https://bit.ly/2YvpN7L
Stock: Pacific Biosciences (PACB) Current Price: 34.28
Why I like It:
The Product/Tech: Gene sequencing is a fast growing industry and the current undisputed leader is Illumina Inc (ILMN). However, ILMN uses what is known as “Short Read Sequencing (SRS)” which is good ( since they make a lot of money with it) but it has limitations and is not as accurate as PACB’s “Long Read Sequencing (LRS)” which has proven to be way more accurate.
The Opportunity/Market: The market is set to grow to $25 billion by 2025 and so is the competition. But if PACB can stay on track with its project execution, price reductions and market development , it can eventually take a sizable chunk of the pie.
The Team: The management team at PACB is led by a former ILMN exec along with a group of academics and engineers with deep roots and experience in the bio/life sciences space. PACB will have to keep improving their process to stay ahead of ILMN and figure out ways to lower the cost and the team in place has the chops to get it done.
The Catalyst(s): As I mentioned earlier, PACBs Long Read Sequencing (LRS) system is easier to use and provides a far more accurate reading than ILMNs system but it is still far too expensive. The company will only start to realize its revenue generating potential if it can get its cost down to a level where it is inline with ILMN or even lower and, as far as the analysts are concerned, that is still far off. However, I am thinking that we could get a cost/pricing update when the company presents at the Cowen Conference in March. Any hint at progress on this front will give the stock tailwind into 2021.
When Am I Buying PACB: I got stopped out on my first buy a few months ago so I am looking forward to getting back in. But PACB has been running a little ahead of itself so I am waiting to pick up some common on a break below 30. I would like to get some leaps as well but the chain only goes out to September. They will report earnings Feb 10th and a negative reaction would give me the perfect entry and set up going into the Cowen presentation. Assuming I get filled between 25 & 30, my stop would be around 17 and, if the news out of the Cowen conference is positive, we could possibly see PACB trade to 70 by year end. A nosebleed valuation? yes but closer to a revenue deluge and that’s all that matters.
About The Company/Product: https://www.pacb.com/company/about-us/
Company Financials: https://www.morningstar.com/stocks/xnas/pacb/financials
Industry Stats: https://www.alliedmarketresearch.com/dna-sequencing-market
Stock: Growgeneration Corp (GRWG) Current Price: 45.84
Why I like it:
The Product/Tech: In every industry there are pioneers and there are those who supply/outfit the pioneers. GRWG are the consummate suppliers to the growers in the fast growing Legal/Medical Marijuana space. They are very strategic and have done well to capitalize on the legislative changes in every single state that has endorsed the recreational/medical use of Marijuana so far. And, based on the roadmap the company has laid out, they will continue to do so as more states embrace the change. The growth has been frenetic so far but it is really just getting started.
The Opportunity/Market: The Hydroponics market in the U.S is set to hit $16 billion by 2025 and GRWG is the biggest player at the moment due to its rapid growth by organic means and strategic acquisitions. It also has a rapidly growing e-commerce presence and a trickle of international sales which has not been tapped fully as yet.
The Team: The GRWG stores have Home Depot type of quality to them and that is no accident. Bob Nardelli, the former Home Depot, is a strategic advisor to the team led by Darren Lampert. These are all seasoned campaigners who know the retail landscape very well and it shows in the results they have been able to produce so far.
The Catalyst(s): Basically every new peice of state or federal legislation that supports recreational or medical marijuan use is a catalyst for GRWG stock. Whatever is good for the growers is good for GRWG. But that is the obvious stuff, what is less obvious is how quickly those changes can take place this year and how fast the company will be able to capitalize on it. When this becomes more apparent it can give the stock another push as folks get in ahead of the changes and then a more sustained tailwind afterwards.
When Am I Buying GRWG: I want to get my fills below the 50.00 level and will hold for ~ 12 months and will throw in the towel on a weekly close below the 35.00 level.
About the Company: https://ir.growgeneration.com/company-information
Industry stats: https://bit.ly/3taPkRO
Company Financials: https://www.morningstar.com/stocks/xnas/grwg/financials