The Vix, Door Dash (DASH) & Stay at Home Stocks

Podcast Transcript

Hey, it’s Jeffrey with another edition of Stock Smart the February 26^th, 2021 edition on a Friday. Hope you’re doing well. VIX is rising again up about 1%. We have reached oversold conditions on the S&P 500 oscillator. And we’re going to be about -2 in the oversold area today. So it is time where we’re reaching critical numbers like the 50-day moving average. We bounce below that today on the S&P 500 which is when it bounced back up. So these are times when you know, the amateur gets scared and runs out of the market, but what you need to do is really be calm and maybe start adding on the dips and so as we continue to unwind a little bit and we are past the point where generally we see buying again. This may be a good time to add lightly to your positions.

[00:00:48]
So again getting a little bit of a correction, there will be some probably tumult in the no earnings period which is coming up and we’re seeing great companies get sold off on earnings. That’s always a bad indicator of being priced a little bit too high in the S&P 500 like Salesforce getting hammered yesterday. And then today again, but those are buying opportunities for longer-term investors so look at it that way. Again, thanks on the podcast growing downloads about 10% each week, it’s really amazing, enjoying doing it and enjoying the feedback I’m getting. I’m going to have a huge announcement on the podcast in the near future. Extremely excited, about two months away.

[00:01:26]
I wanted to note, we were talking about the shortage in chips. President Biden assigned an executive order to examine the supply chain to address the chip shortage. It will be amazing if we could get an American company or factory that worked together that started taking over this oversupply of chips that we get from foreign countries. Again, we’re only making about 10% of the chips in this country. And again, a lot of that has to do with the production quality because they’ve done it in Taiwan and other places in the Asian countries for so much longer and so much better.

[00:01:59]
And so much cheaper. In a critical situation if we had some kind of military venture or war and we were had a chip shortage that could impact everything we do in the military, every weapon, every aircraft, every tank, every install that we have in the military could be affected.

STOCK WATCH

So, we’re going to look at a stock today that got really hammered today Doordash, stock down 10% in the pre-market despite quarter 4 sales soaring 226%, they reported revenue of 970 million adjusted EBITDA of 94 million, they easily beat any estimates. So you’re seeing a gradual flow out of the stay-at-home stocks including Doordash here on what’s amazing earnings. And again, this could be they are getting pounded a little bit on the overall unwinding of the market as well.

[00:02:49]
You know, but it’s been a constant decline since it hit a high of 256, when I look at the technical on Doordash, I’m seeing 140 is where it could go. That’s maybe, I probably wouldn’t be a buyer of Doordash at that point anyway, Doordash, great company, good fundamentals, but probably not entitled to the growth it’s seeing.

THE AVERAGE INVESTOR

So we got a question from Sean and I appreciate the questions, keep them coming to Jeffrey@JeffreyKamys.com and Sean wants to know if you should still be an investor in stay-at-home stocks. Well let’s take a look at pretty much five of the best stay-at-home stocks over the last year -Peloton. You can see this was a great stock to own and we owned it at different times in the year and essentially people started having to work out at home, right? But people are social creatures. They’re going to want to go back to the gyms.

[00:03:36]
So I think people do love their Pelotons and the Peloton entertainment portion or the classes is addictive and people enjoy that and this will be a very good company but could have some adjustments going forward. Etsy sold tons and tons of masks. That was a big thing that they did. Etsy moving up today by the way. Wayfair, another one, home furniture. So people were at home they wanted to make their home better. Makes sense. Roku, streaming home entertainment. Makes sense. And Freshpet because you know what happened during the Covid when it started? People adopted more pets than ever, you can’t even find a pet, you go down to like, you know, the animal shelters. There’s still pets, but it was hard to get a dog, if you wanted a dog and people got lonely. They wanted animals.

[00:04:22]
So the pet business really zoomed and exploded. Now let’s take a look and this is a great way to look at it. If you can lay charts and lay stocks over each other, over periods of time, you can see most of these stocks in the last month have taken a hit, 20% down for Peloton, 8% down for Wayfair. And then we also see Roku down a little bit. So as people move out of this stay-at-home kind of role and we’ve talked about this on some of the shows, people are going to start using their entertainment dollars differently and a lot of these are entertainment type companies, well maybe not Wayfair, but it is kind of, because you are at home and you had people at your house, so that is kind of entertainment, but Roku, Peloton things we do at home.

[00:05:02]
We’re going to want to do different things with those dollars. So I would see a gradual outflow into other companies that are not stay-at-home stocks. So the reverse. You’re going to see more out flow into things like Airbnb. Airbnb has gotten hammered a little bit. But really if I’m going to go travel now in the next 6 months, I’d rather stay at an Airbnb than a hotel where you get multiple people and multiple factors of getting sick, you know, if I go to an Airbnb, I’ll just make sure you clean the place, a lot of those people are aware that people are concerned.

[00:05:33]
So if they’re running their house, they’re spending and being more diligent about cleaning. Airbnb great company, all these things like the Jets the cruise lines have all gotten a lot of exposure movement lately, so that’s where I would be. So thanks for the question Sean. See you again next time on Stock Smart.