The purpose of this investment club movement is in part to make money but the larger WHY is to create a financially conscious black culture. I decided that we should expose some of what we are doing to all those willing to listen in case they want to piggy back on our trades or ultimately hop in and invest with us. This month we are buying two stocks and one ETF. We are buying Sprint, Netflix and QQQ. This post will explain our general thought process behind that acquisition.
Shortly following the election there was news that Sprint/Softbank would be investing billions in America to create jobs. This was check one in the box for Sprint because being willing to invest significantly in growth indicates optimism and strength. Those two qualities indicate a strong stock that is likely to increase in value. Check two was the recent purchase of 1/3 stake in Tidal by Sprint. This is a huge diversification play because of the possibilities of the merger and technology. Sprint can now work this tech into their phones, but also will have the added benefit of the revenue and growth of Tidal along with the start power that comes with working with Jay Z.
There is now talks of company merger in the works. This was the big driver of our nod to purchase. Because mergers typically indicate large leaps in value. Lastly, Sprint’s cell plans are very competitive price wise in a very expensive cell plan market yet their stock traded at a range from $5-8, this indicates that there is a ton of value to be had because the average PE ratio for the sector is 16 yet S has none because they have a negative EPS. More revenue should bring this up.
I say bet on growth and ambition. Sprint has already proven that they have the desire to do both.
At one point in time NFLX was a $700 stock and it split down to about a $100 company. As people probably know, NFLX was at one time mailing out DVDs and has now morphed into a cable TV replacement. What I love about NFLX is they are investing in and creating content that people LOVE. Shows like House of Cards, Orange is the New Black, Narcos etc. I cant really forecast any major moves but I know that NFLX has the money to do what they want and the vision and drive to keep displacing conventional ideas. Another great benefit is that they have consistently seen revenue and membership growth and this doesn’t seem to be slowing down.
QQQ is a Nasdaq (tech company index) 100 index fund. Our club loves QQQ because it holds most tech powerhouses like Facebook, Amazon, Netflix, Microsoft, Apple. These tech companies are doing huge things (especially Amazon) and this fund is our best performing ETF and holding. Owning an ETF like this allows u to diversity out the downside and take advantage of the ambitiout moves these companies are making. ETFs are a great way to start investing because they are less volatile and risky. We love QQQ.
I hope this quick blog gave you some insight to some things you might see on twitter FB and IG. If you are interested in getting on the insie of what we are doing please dont hesitate to email us at firstname.lastname@example.org
– Todd Millionaire