June 2024 Portfolio Review
Total Return: +27.8% YTD (+13.3% vs S&P)
2024 Results:
2024 Monthly Allocations:
Key:
darker green: started during month
lighter green: added during month
yellow: trimmed during month
blue: bought and sold during month
red: position exits
positions >10% in bold
*Please note: I rolled an old 401K worth ~2.5% into the cash balance of this portfolio to start 2024. I’ve shaded the January cash cell to make sure the new cash is represented accurately (and honestly to remind myself as well).
Past recaps:
December 2018 (the one that got things started)
December 2019 (contains links to all 2019 monthly reports)
December 2020 (contains links to all 2020 monthly reports)
December 2021 (contains links to all 2021 monthly reports)
December 2022 (contains links to all 2022 monthly reports)
December 2023 (contains links to all 2023 monthly reports)
Stock Comments:
I’ll take that end to earnings season…
AXON 0.00%↑ – Axon gave us two notable updates this month. First was a partnership with drone maker Skydio on a scalable drone offering for improved public safety. The companies’ joint “Drone as First Responder” program will allow safety agencies “to deploy remotely piloted drones to emergency calls, often arriving before ground units and providing real-time situational awareness to multiple stakeholders from a safe vantage point.” With this deal Axon continues its push to leverage technology toward revolutionizing public safety. Of course, the risk is making sure the company doesn’t spread itself too thin beyond its core competencies. This partnership, however, seems to fit well as an extension of Axon’s current offerings.
Next, Axon announced the United States Marshals Service (USMS) will be adopting the new TASER 10 and its affiliated virtual reality training solutions. This agreement is an extension of Axon’s current body camera program with the Marshals Service. Under this expansion, the TASER 10 will be fully integrated with these camera units, including auto-activating when the TASER is pulled from its holster. The USMS is obviously a high-profile customer, and this looks like another nifty little win.
CELH 0.00%↑ – Being honest, Celsius’s June was uninspiring. After reporting a $25M revenue shortfall in Q1 due to inventory optimization by distribution partner Pepsi, management revealed it expects another $20M-$30M slowdown in Q2 for the same reason. Management has also implied 2024 shelf resets which will increase Celsius’s visibility have gone slower than expected (though are ultimately still on track for the second half).
Combined with some market share fluctuations and a recent slowdown in energy drink sales as a whole, Mr. Market has decided CELH isn’t nearly as attractive an investment as it was a few weeks ago. In the short term, Mr. Market is probably right. In the bigger picture though, inventories and shelf resets should be temporary blips as long as category sales rebound. Management is hopeful (admittedly not always a great word) the usual summer surge will bring things back in line.
If nothing else, Celsius had gotten more complicated to follow as it and Pepsi juggle 2024 inventories while also entering several new international markets. This is especially true given Celsius issues no quarterly or full-year guidance for any type of context. The question becomes just how much CELH is worth holding while waiting for things to play out. For now, I’ll be keeping it on the smaller side.
CRWD 0.00%↑ – CrowdStrike had another crazy-busy month. First, it delivered yet another typical CrowdStrike quarter: a firm beat-and-raise with excellent numbers and a confident outlook bordering on cocky. CRWD continues to charge ahead as one of the stronger combinations of growth, margins, cash flows, and profitability on the market. Now sporting a $90B+ market cap, there’s an argument CrowdStrike is closer to the top of its S-curve than the bottom. As far as I’m concerned, however, everything in this most recent report suggests the underlying business remains as strong as ever.
Post-earnings, CRWD issued several more announcements including:
Being formally added to the S&P 500 on Monday, June 24.
Winning five awards for its Falcon platform at the SC Awards Europe, the most of any vendor in this year’s competition.
Earning a category Leader designation by Forrester Research in Cybersecurity Incident Response Services as well as Extended Detection and Response Platforms. In the latter category, CrowdStrike was the only vendor to receive the highest possible scores across all three criteria of Vision, Innovation, and Roadmap.
Set a record for the fastest threat detection reading in the MITRE Engenuity’s ATT&CK Evaluation. In an assessment mimicking a real-world attack, CRWD detected, identified, and alerted on the threat in just four minutes, which was “six to 11 times faster than competitive vendors.”
Announced a strategic partnership with Hewlett Packard Enterprise to provide joint customers better protection of their AI and large language model workloads.
Announced it has passed $1B in lifetime sales with strategic partner CDW Corporation, a leading IT solutions provider for business, government, education, and healthcare customers.
Announced three new distribution partners in Latin America.
Yes, CrowdStrike is pricey, but it also continues to flat out dominate its industry. Until we see signs of that changing, I’m comfortable keeping this as one of our leading positions.
DDOG 0.00%↑ – June saw Datadog give us one market update and a slew of product releases. The market news was a company report noting a 40% increase in spending on cloud usage driven by GPU’s (graphic processing units) as companies continue to experiment with AI and large language models. How exactly DDOG’s monitoring services fit into that mix are still TBD, but the company is clearly paying attention to where and how customers are spending as the AI revolution evolves.
The product releases came in conjunction with Datadog’s Dash customer conference the last week of June. These updates spanned multiple categories including infrastructure, applications, security, and products designed for team usage. Anyone interested in the specifics can find a consolidated recap here.
ELF 0.00%↑ – e.l.f. Beauty’s marketing machine continued to hum into June with the release of a documentary at the Tribeca Film Festival and a separate media campaign for the addition of Bronzing Drops to its skincare line.
In conjunction with the positive press, the market seems to have gotten over its dislike of management’s initial FY25 guide in what was an otherwise strong quarter. This has pushed the stock back toward all-time highs. That’s fine by me.
IOT 0.00%↑ – In total, I’d call Samsara’s June 6 Q1 report more steady than good. In my opinion, the pleasant surprise in margins, cash flows, and profits was somewhat muted by softish sequential growth and $100K customer adds. Given Q4 was bolstered by the calendar quirk of an extra reporting week, maybe this all smooths out over the next quarter or two. Regardless, I feel Samsara has left itself something to prove that wasn’t there before. I was hoping this report might earn IOT a larger allocation. Instead, I plan on keeping it where it is for now.
TMDX 0.00%↑ – While there’s been no company news, I did see two positive analyst reports added to TransMedics’ collection. That’s not surprising considering the company’s recent results and stock’s move toward all-time highs. Here’s hoping that dynamic continues.
TTD 0.00%↑ – I’ve seen nothing formal on The Trade Desk other than the stock bouncing around 52-week highs. Anecdotally though, I’m starting to see a ramp in political ads hitting local airwaves and feeds. That bodes well for what should be a record haul of political spending hitting TTD’s platform over the next few months.
ZS 0.00%↑ – Zscaler provided a couple interesting updates this month. First, it announced it will be delivering AI-powered Zero Trust security in collaboration with current cool kid NVIDIA. Under this deal ZS will be leveraging NVIDIA’s technologies in its enterprise security offerings.
Next, Zscaler announced an expansion of its partnership with Google to improve access and data protection for users of Chrome Enterprise, Google Workspace, and Google Security Operations.
As usual, these announcements tend to be extensions or deepening of Zscaler’s current offerings rather than branching off into anything radically new. At the same time, ZS deserves full credit for being very good at what it does. Hopefully, these quality partners will keep translating into quality results.
My current watch list…
…remains just monday.com (MNDY) and Super Micro Computer (SMCI) with outside interest in MercadoLibre (MELI) and NVIDIA (NVDA). For now though, they remain on the outside looking in.
And there you have it.
Another solid month. And not just the stock returns, but more importantly the business updates behind them. In a market that has spent much of this year in an optimistic mood, I’m glad these companies continue to give shareholders a reason to go along for the ride.
As usual, thanks for reading, and I hope everyone has a great July.
There was some recent TTD news. They signed a deal with Fox.
Increased access to premium inventory: TTD will gain more direct access to Fox's premium advertising inventory across its entire portfolio, including Fox Sports, Fox Entertainment, Fox News Media, and Tubi.
This deal demonstrates TTD's growing influence in the advertising technology space and its ability to form strategic partnerships with major media companies.
Nice market beating performance. Yeah!