Merging Technicals and Fundamentals
Plus my CNBC hit on Hims and how it triggered the Hostile React-O-Meter™.
▶If you missed it, I did a quick hit on CNBC yesterday regarding Hims....
I had been on the network, where I’m a contributor, back in February with my cautionary take at the time. If you’ve followed my work, I said nothing you haven’t heard me say before. If you’re new to it, consider this a Cliff’s Notes version. You can see it here...
And if you go to the comments, as expected, you’ll see the Hostile React-O-Meter™ is spinning outta control – outta control, I tell ya!
But I will say (and thanks to the hostile poster who pointed this out) I did err in saying GLP-1s are half its revenue. In what turned out to be a 3-minute live stint with a hard stop, I said GLPs were 50% of its business, when it’s more like 40%. So sue me!
But while I was off a smidge...
The most important point – which I’ve been saying from the start – is that the growth of its non-GLP business is decelerating. In other words, the company’s most recent growth has been fueled by one thing: GLPs. And if that business were to be sharply reduced, so would the overall company’s growth – not what investors in this kind of company in this kind of market with this kind of multiple would want to see.
Aside from lawsuits, regulatory action and any other event – the outcome of which would be impossible to predict – therein lies the most apparent risk. Beyond that, if you are playing the stock, best of luck. Interpret at will...
P.S. We’re at a point where it’s becoming increasingly normalized to call anything you disagree with a fake, then twisting the narrative to support your investment thesis. That’s as opposed to trying to understand why somebody might be on the other side of your trade. In other words, same as it ever was, just on steroids.
▶Moving on, I don’t do charts or pay attention to technicals, but I know plenty of people who do...
Some use them exclusively to trade, some use them to help determine when to enter or exit a position, and some let merge them with fundamentals to help improve their odds. They come in all shapes, sizes and forms... And they’re all different in their approaches and even personas. And they all have their followers...
I’m under no illusion that the purity of the fundamentals often takes a backseat to the momentum identified and often fueled by the charts. It can be maddening to watch, as it has been (and still could be) with the likes of Hims.
That was the focus of what I did earlier this week with Steve Strazza, chief strategist of All Star Charts. This is pairing somebody who owned the stock based on the charts... and somebody who had been flying red flags.
Most importantly, it’s what he says the charts on Hims are NOW showing.
Great conversation (if I don’t say so myself) and as you might guess, as was the case with the CNBC hit, it triggered the Hostile React-O-Meter™ to spin outta control. This time someone even took a hit at my age! To quote the great Norm Crosby... I resemble that remark!
Consider this a longform version of what I did on CNBC with technicals thrown in. You can see it here. Enjoy.
DISCLAIMER: This is solely my opinion based on my observations and interpretations of events, based on published facts and filings, and should not be construed as personal investment advice. (Because it isn’t!) I do not have a position in any stock mentioned here.
Feel free to contact me at herb@herbgreenberg.com