Market News
The S&P 500 wrapped up its seventh consecutive month of gains, making it the strongest first eight months of a calendar year since 1997. So far, the upward momentum has continued into September. It will be interesting to see if the market ends September higher, given it historically tends to be a volatile month. Will it be a relatively smooth ride or a roller coaster with some good buying opportunities?
As September ends, two of the three portfolios continue to beat the major Canadian and US Index benchmarks. I suspect Portfolio 1 is underperforming because there have been a few acorns planted (companies that will take time to play out) and if they turn out to be oak trees (successful and growing companies) there is a very good chance this portfolio will beat the 2 benchmarks.
Companies on the Radar
Radar companies are businesses I either hear of for the first time, or businesses I’m aware of and have some recent bit of news that piques my interest to look at them again.
ZIM Shipping (NYSE:ZIM) I first saw this company appear in Twitter about a week ago. ZIM is a 75 year old marine shipping company, based out of Haifa, Israel, with offices in the US and Germany. It has a fleet of 80 vessels and serves 180 ports of call throughout the world. It has strong experienced and tenured leadership with a high Glassdoor score and based on these ratings, staff enjoy working for ZIM and strongly approve of the CEO. It’s a medium market cap company providing plenty of room for growth. Per their March 1, 2021 letter to shareholders, “The main pillars of our differentiation are our asset-light model, exceptional agility and technological innovation through business intelligence, big data, artificial intelligence, and technological partnerships.” https://investors.zim.com/news/news-details/2021/Welcome-Aboard-ZIM-Investors/ After reading the same letter I was left with the impression the company was using technology to disrupt the shipping industry. So far the company passed both my Radar Test and Quick Test checklist, and I plan on doing a deeper dive into the company in the very near future.
Portfolio Updates
Portfolio 1
Portfolio 1 for the week ended September 3, 2021: UP 
CrowdStrike (NASD:CRWD) was added to the Nasdaq-100 (a basket of the 100 largest, most actively traded U.S companies listed on the Nasdaq stock exchange). This is positive news on 2 fronts: first, to grow to the size to be one of the largest 100 Nasdaq companies indicates the company is growing; second, all mutual fund mirroring the Nasdaq-100 must purchase enough CRWD stock to reflect its spot in the index. When the mutual funds initiate a position in a company it typically leads to an increase in the share price.
Activity
On September 1, 2021, KushCo Holdings (OTC:KSHB) completed their merger with Greenlane Holdings Inc (NASD:GNLN), becoming a subsidiary of Greenlane. The ticker will be GNLN. Holders of KushCo will receive .3016 shares of Greenlane for each share of KushCo.
Dividends
Dividends Received this week for the following companies:
Canadian $
Shaw Communications Inc (TSX:SJR.B)
US $
Quarterly Reports
Selected highlights from their August 31, 2021 2Q22 press release
https://ir.crowdstrike.com/news-releases/news-release-details/crowdstrike-reports-second-quarter-fiscal-year-2022-financial
- Revenue: Total revenue was $337.7 million, a 70% increase, compared to $199.0 million in the second quarter of fiscal 2021. Subscription revenue was $315.8 million, a 71% increase, compared to $184.3 million in the second quarter of fiscal 2021.
- Income/Loss from Operations: GAAP loss from operations was $47.4 million, compared to $30.0 million in the second quarter of fiscal 2021.
- Net Income/Loss Attributable to CrowdStrike: GAAP net loss attributable to CrowdStrike was $57.3 million, compared to $29.9 million in the second quarter of fiscal 2021. GAAP net loss per share attributable to CrowdStrike common stockholders was $0.25, compared to $0.14 in the second quarter of fiscal 2021.
- Cash Flow: Net cash generated from operations was $108.5 million, compared to $55.0 million in the second quarter of fiscal 2021. Free cash flow was $73.6 million, compared to $32.4 million in the second quarter of fiscal 2021.
Selected highlights from their September 2, 2021 Q322press release
https://investor.docusign.com/investors/press-releases/press-release-details/2021/DocuSign-Announces-Second-Quarter-Fiscal-2022-Financial-Results/default.aspx
- Total revenue was $511.8 million, an increase of 50% year-over-year. Subscription revenue was $492.8 million, an increase of 52% year-over-year.
- Billings were $595.4 million, an increase of 47% year-over-year.
- GAAP gross margin was 78% compared to 74% in the same period last year.
- GAAP net loss per basic and diluted share was $0.13 on 196 million shares outstanding compared to $0.35 on 185 million shares outstanding in the same period last year.
- Net cash provided by operating activities was $177.7 million compared to $118.1 million in the same period last year.
- Free cash flow was $161.7 million compared to $99.8 million in the same period last year.
- Cash, cash equivalents, restricted cash and investments were $887.2 million at the end of the quarter.
Portfolio 2
Portfolio 2 for the week ended September 3, 2021: UP
Activity
No significant activity to report this week, however, following a great 2Q Report on September 2, the next day shares of MongoDB (NASD:MDB) closed at US$ 507.41 for a jump of over US$ 105 from the previous day’s closing price of US$ 401.65. 😊
Dividends
Dividends Received this week for the following companies:
Canadian $
US $
No US$ dividends this week.
Quarterly Reports
Alimentation Couche-Tard Inc (TSX:ATD.B)
Selected highlights from their August 31, 2021 Q12022press release
https://corpo.couche-tard.com/wp-content/uploads/2021/08/2022-Q1-Press-Release-En.pdf
- Net earnings were $764.4 million, or $0.71 per diluted share for the first quarter of fiscal 2022 compared with $777.1 million, or $0.70 per diluted share for the first quarter of fiscal 2021.
- Total merchandise and service revenues of $4.1 billion, an increase of 5.4%.
- Merchandise and service gross margin decreased 0.1% in the United States to 34.2%, and 2.2% in Europe and other regions to 38.4%, which was impacted by the integration of Circle K Hong Kong. Gross margin in Canada increased 1.2% to 32.3%, due to favorable changes in product mix.
- Same-store road transportation fuel volume increased 11.8% in the United States, 6.3% in Europe and other regions, and 10.4% in Canada, due to higher fuel demand compared to the corresponding quarter.
Selected highlights from their September 2, 2021 Q22022press release
https://investors.mongodb.com/news-and-events/news-releases/news-details/2021/MongoDB-Inc.-Announces-Second-Quarter-Fiscal-2022-Financial-Results/default.aspx
- Revenue: Total revenue was $198.7 million in the second quarter fiscal 2022, an increase of 44% year-over-year. Subscription revenue was $191.4 million, an increase of 44% year-over-year, and services revenue was $7.4 million, an increase of 27% year-over-year.
- Gross Profit: Gross profit was $138.0 million in the second quarter fiscal 2022, representing a 69% gross margin, consistent with gross margin in the year-ago period.
- Loss from Operations: Loss from operations was $72.5 million in the second quarter fiscal 2022, compared to $49.8 million in the year-ago period.
- Net Loss: Net loss was $77.1 million, or $1.22 per share, based on 63.4 million weighted-average shares outstanding in the second quarter fiscal 2022. This compares to $64.5 million, or $1.10 per share, based on 58.4 million weighted-average shares outstanding, in the year-ago period.
- Cash Flow: As of July 31, 2021, MongoDB had $1.8 billion in cash, cash equivalents, short-term investments and restricted cash. During the three months ended July 31, 2021, MongoDB used $19.8 million of cash in operations, $1.7 million of cash in capital expenditures and $1.2 million of cash in principal repayments of finance leases, leading to negative free cash flow of $22.7 million, compared to negative free cash flow of $15.0 million in the year-ago period.
Portfolio 3
Portfolio 3 for the week ended September 3, 2021: UP
Activity
Noting to report
Dividends
Dividends Received this week for the following companies:
Canadian $
US $
No US$ dividends this week.
Quarterly Reports
No quarterly reports this past week