Rocket Lab reusable engines, Meta Monetizes WhatsApp, CRWD and MDB Earnings…
The Growth Curve #006
Hey everyone!
The Growth Curve Portfolio got destroyed this week. So that was fun.
I talk a lot about the fact that if we’re still working and plan to be adding to our portfolios for at least the next 5 years, we should HOPE the market and our portfolio sell off so we can buy more shares of the same great companies for less money.
That’s exactly what I did this week. I bought. I have no intention of selling due to the overall market panicky behavior.
This week, I’m covering important news from RKLB 0.00%↑ TSLA 0.00%↑ META 0.00%↑ CRWD 0.00%↑ and MDB 0.00%↑
But first, I have an exciting update. I am now tracking the Growth Curve Portfolio on SavvyTrader. So people can follow the portfolio and get Email/SMS text updates any time I make a transaction.
I’ll be sending paid subscribers to this newsletter a coupon code to get those SavvyTrader updates for free. Paid subscribers here will also get my full buy thesis and company deep dives on Tuesdays so now is a great time to start a paid subscription (at this link).
If you just want the SMS/Email trade updates from SavvyTrader and not the full buy thesis or company deep dives, you can get those for $10/month by signing up with this link.
RKLB 0.00%↑ - Rocket Lab takes another step forward in goal to reuse orbital rockets
This was a big deal for Rocket Lab on their journey to make their Electron launch vehicle the world’s first reusable orbital small rocket. They conducted a full duration, full-thrust test of a refurbished Rutherford engine that was used for a previous launch and returned to earth on May 2.
TSLA 0.00%↑ Tesla’s China-made vehicle sales to hit 77k in August according to CPCA official
If they did sell 77k vehicles in August, that’s up 74% year over year and up 173% over July 2022 china-sales of 28,217.
MDB 0.00%↑ MongoDB beat estimates & raises FY 2023 guidance but the stock dropped 25%
MongoDB posted Q2 Adjusted EPS of -$0.23, $0.05 above expectations. Revenue was $303M (+53% YoY) which beat expectations by $21.4M. The company also slightly raised FY 23 revenue guidance to $1.192B at the high end which narrowly beats analyst estimates of $1.19B.
The market seemed to really not like management’s guidance for Q3 and FY 23. After the sell-off, the stock now trades at a forward EV/Sales of 13.47 with 38% expected forward revenue growth. That brings us to a EV to Sales growth ratio of 0.35. For high-growth companies, I look for EV to SG to be under 0.4.
The bottom-line is that management believes they currently have 2% market share of an enormous market. Some customer’s apps saw less usage this quarter due to over all macro concerns. I’m guessing a lot of this is crypto/Web 3 related customers.
In my opinion, this will turn around and it would be a mistake to sell on these short-term headwinds. I bought more shares after earnings and I’ll look to opportunistically build MongoDB to around a $10k position.
Here is a quick note from the earnings call that shows how management remains aggressive and focused on the long-term and just how early MongoDB is in it’s growth curve.
Dev Ittycheria, Co-Founder & CEO: I am pleased with our execution in the second quarter. Despite macroeconomic uncertainty, we are focusing on what we can directly control, namely bring new customers and new workloads onto our platform. The breadth of adoption across many use cases gives us continued confidence to judiciously invest across our business to best position ourselves to fully capitalize on our long-term market opportunity.
META 0.00%↑ Meta & Qualcomm partner to develop VR chips
Under the agreement, Qualcomm will develop and produce chips specifically customized for Meta’s Quest devices but they won’t be exclusive to Meta. So they can be used in other devices but will be optimized for Meta Quest devices.
Meta launches grocery delivery with JioMart inside WhatsApp
This is actually kind of a big deal. WhatsApp is basically untapped from a monetization perspective and if Meta successfully changes that it could be a nice catalyst for growth.
Meta called this "the first end-to-end shopping experience" on WhatsApp. Customers in India will be able to buy from JioMart’s full grocery inventory without ever leaving WhatsApp
CRWD 0.00%↑ Crowdstrike beat on Adjusted EPS, revenue, and raised FY23 guidance.
The quarter wasn’t a blowout but it was strong. I’m particularly pleased with the rate that customers are adopting 5 or more modules. This is a sign of deeper customer relationships and sustainable revenue growth.
The META Jiomart shopping launch is particularly interesting. If I am not mistaken, WeChat always had this built in for their Chinese customers...hugely popular service that generated $Bs of sales for BABA etc. The Meta WhatsApp Jiomart service will take off quickly in a market like India. The question will be whether META will make any money off it. I am not sure.