Authors Brian Feroldi
I receive tons of wonderful replies and read through them all
Here are 31 amazing threads that are well worth your time ⬇️
1/ @10kdiver on
2/ @aaronbush100 on 20 semi-controversial investing
20 semi-controversial investing beliefs [THREAD]:— Aaron Bush (@aaronbush100) May 24, 2020
3/ @annieduke on category
The most dangerous category of poor decisions are ones that remain easily hidden from view because any instance of that type of decision is so easy to rationalize.— Annie Duke (@AnnieDuke) October 7, 2020
4/ @awilkinson on losing
This is a story about how I lost $10,000,000 by doing something stupid.— Andrew Wilkinson (@awilkinson) March 30, 2021
Ten. Million. Dollars.
Literally up in smoke. Money bonfire.
That\u2019s enough to retire with $250,000+ in annual income.
Here\u2019s what happened\u2026
A step by step guide using $DXCM as an example
2/ The BIG question: Is the thesis on track❓
❓Is revenue growing?
❓Are margins stable/expanding?
3/ I open 4 browser tabs
Tab 1 - Current company earnings report / shareholder letter
Tab 2 - Previous company earnings report / shareholder letter (check guidance)
Tab 3 - Analyst estimates
Tab 4 - Call Transcript
4/ Tabs 1 & 2 - Find the current & previous earnings report
I search "Dexcom Investor Relations"
I click on "press release"
Open the newest quarterly earnings report and last quarter
It can also be a shareholder letter/presentation
5/ Tab 3 - Find the quarterly analyst estimates
Open up $DXCM in yahoo finance
The "news" section usually has a link to reports on whether the company beat/met estimates
The "analysis" tab is a good source, but sometimes it updates to the next quarter too quickly
A reminder of @morganhousel cash strategy.
For every $1,000 in cash:
If you've truly found the next $AMZN, $AAPL, or $NFLX and can hold for years, it's nearly impossible to overpay.
But finding them is hard.
Millennials have seen tech crash, 2008, and now #COVID19
I'm worried that many of them will swear off the stock market -- the greatest wealth-building device ever -- for life.
Want to see the checklists used by
When the P/E ratio is:
Useless (Stage 1, 4) - $MDB, $SHOP, $PINS, $GME, $JCP
Semi-useful (Stage 2) - $TTD, $NFLX
Useful! (Stage 3) - $MSFT, $AAPL, $V
In determining valuation
1⃣Only looking at the share price
I bought penny stocks at the start
My logic: 100 shares of $1 stock > 1 share of $100 stock
The price of 1 share is meaningless!
What matters is how great the company is!
2⃣Only looking at dividend yield
I bought stocks with 10%+ yields
My logic: 10% yield > 1% yield
The dividend got cut and the share price dropped -- a double-whammy!
A high yield is Wall Street's way of saying "this yield is not sustainable, watch out"
3⃣Selling a great stock early
I bought $DXCM in 2007 for ~$6
I sold it 1 month later after a 15% gain
Current price: $412.58
I was in a rush to take profits, so I missed out on HUGE upside
If the opportunity is huge, hold!
4⃣Not buying a great stock due to valuation
I've made this mistake over and over again
I didn't buy $ZM at $80 because the valuation was "insane"
Current price: $455
If you like everything about the company except the valuation, but some
Even if it's just a little bit
But I’ve learned 10x more about investing from listening to podcasts than I did in school
Here are 24 podcasts that I regularly listen to that will make you a better investor⬇️
1/ Acquired -- @AcquiredFM
This podcast "tells the stories of great companies"
Ben Gilbert & David Rosenthal do a great job of talking through acquisitions & have a stellar list of guests
2/ Animal Spirits
@awealthofcs & @michaelbatnick break down financial news, share insights that they are thinking about, and recommend TV shows & movies
3/ The Business Brew
@BillBrewsterSCG does long-form, in-depth, discussions about capital allocation and the psychology of investing/business
4/ Capital Allocators
@tseides has an amazing series of guests that discuss all facets of investing
His recent book -- Capital Allocators -- takes all of the top learners from his interviews and condenses them into a book
Here are 15 traits that tell me I've found a great business ⬇️
1/ Recurring Revenue
Business Services $MCO
Real Estate $STOR
SaaS, PaaS, IaaS $TWLO, $NOW, $FSLY
2/ Recession-Proof Demand
Great companies sell products/services that are in-demand in good times and bad
That allows them to grow regardless of what is happening in the broader economy
3/ Organic Growth
"Organic" growth: Growing by increasing sales of internally developed products/services
"Inorganic" growth: Growing from mergers & acquisitions
Organic Growth > Inorganic Growth
4/ High & Expanding Gross Margin
Indicates that the company’s products/services create a huge amount of value for the customer
Rising gross margin also indicates pricing power
Here are their current top 10 holdings (in order) and links to their latest buys/sells ⬇️
Top 10 (in
Appaloosa: (David Tepper)
I play daily and coach at my kid's school, so I love seeing the interest
If you're want to learn about chess, here are some great free resources (thread)
2/ How to play & basics
3/ Opening principles
4/ Common beginner
5/ Advanced topics
6 Power Moves of
I use them every day to help me find great investments
Want to create your own investment checklist?
Here are some great resources to help you get started
2/ Here's my free public spreadsheet that details my current
3/ Here's my detailed board post about how to use the
4/ Here's a detailed thread on Michael Shern's EXCELLENT investment
Just finishing reading "The Investment Checklist" by Michael Shearn.— Brian Feroldi (@BrianFeroldi) July 4, 2020
I HIGHLY recommend it!
(Puts my checklist to shame.)
Here's the book's checklist:
5/ Here's a thread on how I created my
1/ How to create an investment checklist (thread)— Brian Feroldi (@BrianFeroldi) December 8, 2020
Checklists are an amazing, FREE, underutilized investing tool
Here's the step-by-step process for how to create your own
If you buy stocks, you MUST learn how to read a Cash Flow Statement.
Here’s everything you need to know:
The cash flow statement shows how cash moves in and out of a company over a period of time.
The most common time periods are:
▪️Year-to-date (usually 6 or 9 months)
The time period is at the top. Here's $NFLX recent cash flow statement time period.
Some companies show the cash flow statement in their earnings press release, but many don’t.
You can find the cash flow statement by looking at:
▪️10-Q (Quarterly Report)
▪️10-K (Annual Report)
▪️Fnancial aggregators such as @theTIKR,
@CMLviz, @themotleyfool, @YahooFinance
There are three main segments to a cash flow statement.
1. Operating Activities
2. Investing Activities
3. Financing Activities
Companies get some leeway with how they breakout each segment, but they all follow this basic structure.
Let’s start with Operating Activities.
This segment STARTS with net income (the bottom number of the Income Statement).
It shows cash movements from all normal operational business activities.
Here’s what "financial wellness" means to me
Humans are programmed to think short-term
Evolutionary, thinking short-term makes sense. It helps with survival.
Financial wellness is all about training yourself to develop a long-term mindset
Not easy -- it takes practice
If you join the right tribes, you can’t help but improve
Twitter / Podcasts / Blogs / YouTube -- when used correctly -- are amazing
1/ YouTube is an AMAZING resource when used properly (Thread)— Brian Feroldi (@BrianFeroldi) November 7, 2020
Here are my favorite YouTube channels:
Mark Rober - @MarkRober
Smarter Every Day - @smartereveryday
Stuff Made Here - @stuffmadehere
Wintegartan - @wintergatan
Educate yourself - constantly!
These 3 categories have an outsized influence on all areas of your life
1/ Book recommendations (thread)— Brian Feroldi (@BrianFeroldi) November 20, 2020
Richest Man in Babylon
Millionaire Next Door
Rich Dad, Poor Dad
The Wealthy Barber
In the beginning, focus on growing your income
Do more than what is expected
Become a lynchpin
Find a career that you ENJOY (<- important!) that also has high-income potential
Start a side hustle (<- important!)
Build your talent
I Wish I Could Teach My Younger Self 🧵
1⃣ ALWAYS live below your means
2⃣Developing a long-term mindset
is the foundation of financial success
3⃣In the beginning, your savings rate is all that matters
Eventually, your investing returns are all that matters
Focus your time accordingly
4⃣Financial freedom is achievable
The price is ~10 years of hardcore saving/investing
I received 710 answers
Here are 20 top stocks that have 50x+ potential:
1: Alteryx - $AYX
Market cap: $5.1 billion
What it does: Big data analytics
2: Boston Omaha - $BOMN
Market Cap: $900 million
What it does: Berkshire Hathaway 2.0
3: Beyond Meat - $BYND
Market Cap: $7.9 billion
What it does: Plant-based meat
4: Desktop Metals - $DM
Market Cap: $2.3 billion
What it does: 3D Printing
Study these stocks to learn more:
$LGVW / $BFLY
Podcast deep dives ⬇️⬇️⬇️⬇️⬇️⬇️⬇️
Here are 24 top investing quotes from Buffett, Bogle, Graham, and more that can help🧵
"If you have trouble imagining a 20% loss in the stock market, you shouldn’t be in stocks."
-- John Bogle
"Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble."
-- Warren Buffett
“Individuals who cannot master their emotions are ill-suited to profit from the investment process”
-- Benjamin Graham
"A calm sea does not produce a skilled sailor."
-- Tom Culve
I used to think mission statements were just corporate fluff
False words that companies created for HR reasons
I've slowly changed my mind about them
They are THE BEST stakeholder alignment & decision-making tool ever
Need convincing? ⬇️⬇️⬇️⬇️
2/ What is a mission statement?
At its core, a mission statement should answer this question:
*****Why does the company exist?*****
A profound question that is easy to overlook!
3/ When used properly
Mission Statements should guide ALL of the actions of the organization
It's like a company's North Star
If an activity doesn’t advance the mission,
it should be discarded!
If an activity does advance the mission,
it should be adopted!
4/ A Mission and a Vision statement are different
Mission: WHY the company exists
Vision: What the company/world looks like if the company is successful
Both important, but they are NOT interchangeable
5/ The reason I used to think mission statements didn't matter
is because the vast majority of companies/CEOs
don't believe they matter!
Most companies SUCK at creating & communicating them!
Why should employees/shareholders care about a mission
if the company/CEO doesn't?
I received 322 replies
Here are 10 great metrics to look at first (and how to find them):
1/ Market Capitalization
Why: Shows the current size/scale of the business
Where: @YahooFinance (image), @theTIKR , @KoyfinCharts ...etc
2/ Sales Growth Rate
Why: Shows the business model works & current growth rate
Where: @stockcardhq (image), SEC filings, @theTIKR...etc
3/ Free Cash Flow
Why: Is business generating cash or burning cash?
Where: @YahooFinance (image), SEC Filings, @stockrow1...etc
4/ Returns on capital (ROE, ROIC, ROA)
Why: Shows capital efficiency of business
Where: @stockrow1 (image) , @ycharts , @YahooFinance...etc