5 Charts For The Week

Hi all 👋

Last week was an interesting one. I didn’t buy anything aside from our DCA’s, but I did trim a bit of ONDS, and HIMS. Many people thought last week was an incredible buying opportunity, but remember we are still only ~1.8% away from ATH’s in the S&P 500.

I suspect there will be much better buying opportunities down the road.

Despite this, there’s a few stocks that I’ve been mentioning to paid subscribers recently that I am interested in adding to or initiating a new position.

Here’s 5 of them 👇

The first 3 will be open to all and the last 2 will be for paid subscribers.

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1. Upstart | UPST

Paid subs will know that UPST is my biggest loser (only 3 currently in the portfolio of 34) so far as I’m down 30% with an average cost of $66.

I do think the stock was perhaps hurt more than it should have been based on the BTIG report (that turned out to be incorrect) and especially since UPST CFO point out credit quality was strong in Q2. I highly doubt there has been much of a turnaround in the sector in the 2-3 month period, especially when SOFI CEO said “credit is also performing well, and so we’ve seen no change there” only 1 month ago in September.

UPST is nearing a zone where I will add to (bottom blue circle), so if we get there I’ll update paid subs the second I make a purchase.

Remember with UPST we have a company that will perform well in a rate cut environment trading for 21.6x NTM EBITDA and growing EBITDA at 40.3% CAGR over the next 2 years.

That’s undervalued in my opinion.

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2. Aurora Innovation | AUR

People are massively focused on the air taxi market with eVTOL’s like JOBY (as am I), and the AV market (TSLA, UBER etc) but I think they’re missing the safer, and more obvious opportunity in robotrucking which will be a much bigger industry through to at least 2040.

With around $900B per annum in US trucking revenue, even capturing a small percentage of that through autonomous trucking will reap huge rewards.

AUR are still basically pre revenue (started commercializing in May), but they’ve emerged as a pretty strong leader in the space with their proprietary technology already solving full FSD on highways. They’re also down about 30% since they started commercial operations.

Even though data is fairly solid right now, much more time is needed before the technology becomes as valuable as AUR suggest it can be. For example, Waymo is already crushing it with +100 million miles on the road, whilst AUR is barely crossing 30,000 miles. This therefore makes it quite a risky play, but long term if they can execute, they’re set to ride a pretty bullish long-term trend.

Looking purely at technicals, I think AUR is one of the best setups I am tracking right now.

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3. Zeta Global Holdings | ZETA

ZETA, just like UPST, is also reaching a nice level that I set my reminders to add at. ZETA is already a 4% position in my portfolio, but if we hang around this level in the upcoming week, I think it will easily surpass 5%.

In my opinion, they’re one of the strongest companies to ride the AI applications layer (alongside LMND for example), and the valuation is extremely nice.

Analysts estimate $650M in EBITDA in FY29 which would be a CAGR of 25% over a 4 year period. In return for that strong growth, you get a stock trading at a 14x NTM EBITDA.

If we assume they hit $650M in EBITDA by FY29, and they trade at 15x EBITDA (still quite low for a company growing that quickly, especially in the AI niche), then we have a $9.75B company which is essentially a 2.4x opportunity from today, and that’s based on a conservative multiple.