A few days ago, I had a first look at the “massacred” listed Insurtech sector and decided to focus on the P&C players only. This week, both Lemonade and Root reported 2021 numbers. I’ll start with Lemonade and will continue with Root in a few days
Lemonade 2021:
This is the overview of 2021:
Looking at Danish stocks in a random order is a very good “therapy” against the current market volatility. Therefore the next batch of shares. This times, three of them made it onto the “watch” list.
21. Jeudan A/S
Jeudan is a 2 bn EUR market cap real estate company that seems to do something right as the long term share price shows:
And on we go with the second post after kicking off last week. Two of the stocks already appeared in the blog some years ago and overall, these ten candidates yielded two “Watch list” candidates.
11. Conferize A/S
Conferize is a 15 mn EUR market cap company that seems to develop software for managing conferences. The company seems to be still “pre revenue”. I do not fully understand why a pre revenue Software company is public, but I’ll happily “pass” without further analysis.
12. Jobindex A/S
Jobindex is a 220 mn EUR market cap company that operates an online Job board which covers all Danish vacancies. The company has been growing nicely until 2018 but then stagnated already in 2019. The chart reflects this to a certain extent, the share price now is similar to the price during the “high growth” phase:
The (short) history of Insurtech so far:
Just a few years ago, “Insuretech” was one of the hottest sectors within Fintech and VC. As in other sectors like retailing or travel, “Digital Insurance” companies were supposed to disrupt this old and slow industry. Listening to VCs and founders was mostly about how easy it would be to take market shares and profits from the old Dinosaurs.
Lemonade was the first Insurtech that went public in July 2020 and its 139% increase on the first day clearly set the scene. The share price went up further and peaked in February at around 170 USD.
Of course this triggered a certain feeding frenzy and a couple of other Insurtechs went public either via IPO or SPAC in the following months, like Root, Oscar, Metromile etc.
However, now, roughly 18 months after Lemonades IPO, things look a lot different. Here is an overview of the “Chainsaw massacre” that happened (in the order off going public):
Disclaimer: This is not investment advice. PLEASE DO YOU OWN RESEARCH !!!!
The company:
Nabaltec is not a fancy Biotech company as the name might indicate, but a rather “old economy” Specialty Chemical company focusing on Aluminium-oxide based materials, located in the middle of nowhere in my home state Bavaria. This typical “German Mittelstand” company had its IPO in 2006, and was created 1996 as management buy-out of a production facility from VAW AG. The beginnings of the plant as such seems to have been built in 1938 and looks like this:
Background/Introduction:
For some reason I ran into a “Twitter battle” about Auto1, with the main Bull case being that Auto1 is the German Carvana. In addition, some good investors that I follow have revealed Carvana as a position.
Time to have an “Armchair investor” look into Carvana. The goal here is two fold:
Full disclosure: the guy who is writing this, lost significant money with investing into Cars.com, another US online car company. So as always: PLEASE DO YOUR OWN RESEARCH !!!
The Carvana Business “Bull Case”
important: Just as I was about to finish the post, Rob Vinall has released his 2021 letter to investors with a very convincing pitch for Carvana. I highly recommend to read it first.
Disclaimer: This is not investment advice but my personal (and often unqualified) opinion. PLEASE DO YOUR OWN RESEARCH !!!
Background & Intro
Long term readers of my blog might remember a certain obsession with travel companies over the past few years. Among other posts, the main analysis were these ones:
Part 1 – Lastminute.com
Part 2 – Expedia
Part 3 – Trivago
Part 4 – Flight Centre – book review
Part 5 – Flight Centre
Part 6 – Tripadvisor
Part 7 – Tripadvisor (cont)
Part 8 – GDS (Sabre, Amadeus etc.)
Part 9 – Expedia (cont)
Part 10 – AirBnB
With the exception of a short, mildly successful (and very lucky) speculation in Expedia, I found the sector as “too hard” for me to invest as too many things were moving at the same time:
The more I look into those companies, the more difficult the sector seems to become. There is a lot of fundamental change going on, Which on the one side is good for agile players but on the other hand makes it very difficult to predict anything and extrapolate trends from the past.
As a Value Investor, unpredictable fast-moving industry changes are difficult. In order to invest in such a sector, there should either be a significant moat and/or fantastic management or a very cheap valuation.
So why now looking again at a travel company ? To be honest, I was motivated by a comment from “Celebrity investor” Philipp “Pip” Kloeckner in my Twitter feed as I introduced HomeToGo as a part of my “Bumsbuden Wikifolio” where I collect German shares that I think are staying away from makes a lot of sense.
Pip commented that he has a very different opinion, which is not surprising, as he is sitting on the Supervisory board and seem to hold around 100k shares that he received for consulting in the early days of the company.
Disclaimer: This is not investment advice. PLEASE DO YOU OWN RESEARCH !!!
What a difference a year can make. Less than a year ago, I tried to enlarge my circle of incompetence by looking at BioNTech. This was my summary back then:
I have to admit that some “fear of regret” plays a role here. i would deeply regret not to have invested if this becomes an even bigger success. Therefore I decided to invest “only” 2% of the portfolio into BioNTech within my “Long term growth bucket” at around 98 EUR/share, reflecting the inherent risk at this stage.
My game plan would be to hold this at least 2-3 years and only consider to sell if the stock drops for no reason by more than -50% or goes up by more than +100%.
I expect very positive results both, for 2021 and 2022, however after than, vaccine sales will clearly go down and then it needs to be seen how the cancer pipeline works out or if they can come up with more vaccines.
If initial pipeline would become more concrete and the valuation still makes sense, I might increase the position in 2 or 3 years from now. In between, the position will motivate me to learn more about mRNA and Biotech in general, which is a nice side effect.
In between the stock did hit a peak of ~390 EUR in August 2021, I.e. almost quadrupling from the level that I bought before falling back sharply to a level EUR 150 at the time of writing
I did actually sell 30% of my position at prices between 270-300 at the end of July, getting back my invested money (before taxes).
The big question is: What to do now ?
Following an annual tradition once a year I’ll try to review my current portfolio by writing short summaries/update for each individual position. Unfortunately, I didn’t manage to do this before year end in 2021, but better late than never.
This year, 17 of the 27 companies from last year are still in the portfolio and I have 11 new positions which again looks like quite high turnover. Again, part of that high turnover is driven by “killing” the travel basket and creating a new “Energy Transition /Electrification” basket.
Overall, the number of positions is on the upper end of my preferred range of 20-30 titles. So any new investments will need to be financed through a sale of existing positions.
The summaries of the previous years can be found here:
My 21 (+6) Investments for 2021
My 20 investments for 2020
My 22(+1) Investments for 2019
My 21 investments for 2018
My 27 investments for 2017
My 27 investments for 2016
My 28 investments for 2015
My 24 investments for 2014
My 22 investments for 2013
1. TFF Group (6,0%)
Introduction: Why looking at Crypto at all ?
I had written first about Bitcoin in September 2016, when 1 Bitcoin was around 1000 USD. I always had an academic interest because the original idea and the execution of a decentralized decision making system has been a great achievement in itself. You’ll find an attempt to describe Bitcoin and Blockchain here from September 2017.
In November 2017 I made the following observation:
In my opinion, the current Cryptocraze is much more like the South Sea bubble than the Tulip mania.
Underlying the current Crypto currency mania in my opinion is a fundamental new way how to raise capital for and create a new type of decentralized organization.
Clearly the then prominent ICOs were mostly complete garbage or outright theft, such as Wysker or the Naga Coin.
However, four years later, Crypto is booming again and the big currencies are more “valuable” than ever before and there is a “Cambrian explosion” of activity all over the Crypto space.
So I decided to have another look at the Crpyto mainly to educate myself on new Crypto currencies but also on “second generation” activities such as Staking, DAOs, DeFi and NFTs.
Maybe it is of interest to some readers, maybe not, but I do think it makes sense to understand a little bit the evolution in this space. Just to be clear: I don’t think that the space is “investable” as such, however part of the infrastructure that is created now might have impacts on other parts of the economy and society.
So let’s kick it off with looking at the main 20+ Crypto currencies according to “market cap” according to coinmarketcap.com.
value and opportunity 