Old-Fashioned Stock-Picking for Modern Markets
August 7, 2025
From the Editor
PLEASE NOTE:
- Any discussions or information shared in this conversation about stocks or potential trades are for informational purposes only and should not be construed as investment advice.
- Before making investment decisions, individuals are responsible for their own research and consulting with a qualified financial advisor.
- We, or our affiliates, may have positions in the stocks mentioned, potentially influencing our opinion.
- You should not buy equities unless you are prepared to sustain a total loss of the money you have invested plus any commission or other transaction charges.
The recent pop in DigitalOcean (DOCN) was the perfect manifestation of our 11th Commandment, “Know what you own-or the market makers will shake you out”. DOCN is as much an AI stock as you can find (AI for the little guy-companies that is), and despite an EPS estimate that was raised to nearly $2.00 per share a few months ago, the stock went inexorably lower nearly every day for several months from $42 to $26.
How many supposed AI stocks are even profitable? Blame manipulation, shaking out the weak sisters, the company’s debt position, whatever. There was nothing really new in the company’s recent quarter reported. Point is, this stock was expertly accumulated by the nether forces, and can trade at almost any price these forces with the BBC (Billionaire Boys Club) deem necessary, even or especially with this solid earnings profile.
The valuation gap between Samsara (IOT) at 16x revenues and PowerFleet (AIOT) at 1.5x revenues continues to be a headscratcher for me. They are both well-run entities, but the South African PowerFleet connection and a slight earnings miss just doesn’t suffice as an explanation for the stock’s drubbing. Stay tuned.
Keep an eye on Health Catalyst (HCAT) in the wake of the buyout of Performant Healthcare (PHLT). Kodak (KODK) and Nova Minerals (NVA) are interesting specs if you believe the Trump administration is willing to invest in public U.S. companies other than MP Materials (MP). The crypto burst from a few weeks ago likely marked a short-term top for Crapto-Crypto (see SBET and SQNS). Stick with select small-cap stocks and take some control of your destiny.
In Closing
*The Dinosaur* doesn’t roar, it rumbles quietly, patiently, confidently. When the tide turns—as it always does—those who held to discipline, valuation, and patience will be well rewarded.
Until next time,
—The Editor
