Stocks On My Screen For Week Starting October 12th, 2020

Every week, our model comes up with 40 stocks, 20 positive and 20 negatives, to watch for next week’s trading. The model is based on a mix of fundamental and quantitative factors, built on my proprietary database of detailed earnings model on more than 1250 U.S. listed companies. The historical data for these earnings models is sourced from SEC filings. Performance of last week’s model portfolio for the week was, Net: 0.6% Longs: 5.6% Shorts:  -5.0% Assuming 5% is dedicated to each position, resulting in 0% net exposure and no…

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Stocks On My Screen For Week Starting August 17TH, 2020

Every week, our model comes up with 40 stocks, 20 positive and 20 negatives, to watch for next week’s trading. The model is based on a mix of fundamental and quantitative factors, built on our proprietary database of detailed earnings model on more than 1225 U.S. listed companies. The historical data for these earnings models is sourced from SEC filings. Performance of last week’s model portfolio was, Net: -0.8% Longs: 0.8% Shorts: -1.6% Assuming 5% is dedicated to each position, resulting in 0% net exposure and no change in position…

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Yes, CarMax Can Catch Up

There is growing concern among investors that CarMax Inc. (NYSE: KMX) will get left behind, due to its old business model, in an industry that is fast getting digitized, a process that has picked pace after the pandemic. Yes, the stock may have recovered most of the ground lost after March, when the used vehicle sales collapsed, but the stock continues to trade at a significant discount, based on most traditional valuation metrics, to peers that have higher exposure to online sales.   Next Yr. PE P/ Sales Market Cap…

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CarGurus Doesn’t Deserve A Premium Anymore

CarGurus Inc. (Nasdaq: CARG) is trading at an elevated premium, especially compared to other players in the online used vehicle sales industry, but the fundamentals suggest this premium is unwarranted given the business seems to be losing the edge to its peers. No matter whether one is a growth investor or value, other stocks in the space offer better risk-reward tradeoffs.   Next Yr. PE P/ Sales Market Cap (M) Gross margins Last FY Sales Growth Next Yr. CarGurus Inc.  46.8  5.2  $3,150 94% 26% Carvana Co.  Loss  5.2  $27,170…

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Cars.com, Because Used Car Sales Are Back, But Online

Cars.com Inc. (Nasdaq: CARS) is uniquely positioned to make a comeback riding favorable macro tailwinds and ramp of new solutions launched in the recent past. In the meantime, the stock is trailing near multi-year lows after the company went public in 2017. To some extent, the stock reminds of dotcom era busts that consolidated a few years and came back with stronger fundamentals. Following up on our note on Carvana Co. (Nasdaq: CVNA) yesterday taking a closer look at used car sales businesses that may benefit disproportionately not just from…

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Carvana: Use Correction, If Any, Wisely, The Story Has Wheels

Carvana Co. (Nasdaq: CVNA) will come out with second-quarter results on Wednesday, 5Th August. These results are important given the fundamental business is facing major headwinds while investors are extremely bullish on the stock that is trading near an all-time high at a valuation that is among the richest in the car distribution industry, if not in the broader technology space. Meeting such elevated expectations is difficult for any business even during normal times; leave alone when the used car sales are declining for the last five months. We won’t…

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Stocks On My Screen For Week Starting July 27th, 2020

Every week, our model comes up with 40 stocks, 20 positive and 20 negatives, to watch for next week’s trading. The model is based on a mix of fundamental and quantitative factors, built on our proprietary database of detailed earnings model on more than 1225 U.S. listed companies. The historical data for these earnings models is sourced from SEC filings. Performance of last week’s model portfolio was, Net: 3.70% Longs: 2.35% Shorts: 1.35% Assuming 5% is dedicated to each position, resulting in 0% net exposure and no change in position…

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How High Can Vroom Stock Go, If Compared To Carvana

Vroom Inc (Nasdaq: VRM) will start to trade today and given how eagerly some of institutional investors were waiting for the IPO, it won’t be surprising to see the company coming out flying as the trading opens. Yes, everything next generation is driving excitement on the Street, case in point Nikola Corp (NKLA), and Vroom will be no exception. Most Sell-side researchers going to point out similarities between Vroom and Carvana Inc (NYSE: CVNA), another high flyer e-commerce car retailing play that had a phenomenal run over last 2-3 years,…

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