Lots of Freedom Portfolio positions have reported earnings over the past two weeks, a time period which has coincided with a pretty sharp drop in many of those same companies (despite some pretty incredible earnings). Let’s go quickly through some:

Earnings Quick Hits

• Shopify (SHOP): Firing on all cylinders. A simply incredible quarter on all fronts. The only concern going forward is if this rate of growth can continue when the economy opens back up. I think it can.
  • Share of U.S. Retail eCommerce Sales in 2020: 8.6% (2nd only to Amazon and higher than Walmart)
  • Revenue growth: 94% year over year
  • Gross Merchandise Volume growth: 99% year over year
  • Gross Profit growth: 89% year over year
• Square (SQ): Mixed results, but Cash App is a bright spot. A continued rise in the price of bitcoin and re-opening of small and mid-sized businesses should provide some tailwinds going forward.
  • Gross Profit growth: 54% year over year (but only 1% quarter over quarter)
  • Cash App Gross Profit growth: 162% year over year (but down quarter over quarter)
  • Cash App Customer Acquisition Cost of less than $5
  • Gross Profit per monthly transacting active Cash App customer reached $41, up 70% year over year
• Roku (ROKU): Strong growth benefitting from what appears to be an accelerating trend towards online streaming.
  • Gross Profit growth: 89% year over year
  • Active accounts growth: 39% year over year
  • Streaming hours growth: 55% year over year
  • Average revenue per user up 24% year over year
  • In 2020, 38% of all smart TVs sold in the U.S. were Roku TV models
• Fiverr (FVRR): Continued strong growth with expectations for it to continue into 2021. Network effects should help the company grow and (continue to?) establish a moat going forward.
  • Revenue growth: 89% year over year
  • Active buyer growth: 45% year over year
  • Spend per buyer growth: 20% year over year
  • Outlook for FY 2021: 46-50% year over year growth
• Redfin (RDFN): Seasonality and pandemic related swings make comparisons difficult, but Redfin seems primed to ride this real estate boom. Would’ve liked to have seen slightly stronger numbers considering what we saw from Zillow, but still like the long term story.
  • Website visitor growth: 44% year over year
  • Market share grew from 0.94% to 1.04% year over year
• Teladoc (TDOC): Early innings of integrating Livongo, but strong results regardless. Looking forward to seeing where this company is a couple of quarters from now (and a year removed from the Livongo acquisition).
  • Revenue growth: 145% year over year
  • Total visit growth: 139% year over year
• Novocure (NVCR): Long term thesis intact with many clinical milestones upcoming over the next few years. Still early innings
  • Net revenue growth: 45% year over year
  • Active patient growth: 17% year over year
• Etsy (ETSY): Riding the same tailwinds as Shopify and creating their own network effects. This is the type of growth that should continue to compound in the coming quarters.
  • Gross Merchandise Sale growth: 118% year over year
  • Revenue growth: 129% year over year
  • Net Income growth: 375% year over year
  • Active seller growth: 62% year over year
  • Active buyer growth: 77% year over year
• Axon Enterprise (AXON): Not quite the same levels of growth as Etsy and Shopify, but really solid nonetheless. The nature of the business means that these gains should be fairly sticky going forward, too.
  • Revenue of $226 million grew 32% year over year
  • Gross margin of 62.5% improved 860 basis points year over year

Transactions

Sold Tesla (TSLA): Nothing new here. Tesla has been a huge winner for me and I’ve been pretty open about how, while still being bullish on the company, I’ve gotten a little concerned over the valuation getting a bit out of hand. I trimmed a bit more to bring the position size more in-line with my conviction. It remains an Enterprise level position.

Started positions in Butterfly Network (BFLY) and TransMedics Group (TMDX): Two companies that had been on my radar for a bit. Finally decided to open up some small, speculative positions in both. If they show they can execute, I will consider adding more.

Started position in Snowflake (SNOW): I’ve been wanting to own some Snowflake since before their IPO, but the insane run-up in price during the IPO dampened my enthusiasm. After seeing it drop from the high 300s to the mid 200s, I decided it was time to start a small position. I’m interested in seeing where it goes after the lock-up expires in March. Might add more then.