My Stock Portfolio Review, September 2024
Portfolio Review
Holdings:
Monthly Allocations:
* green (added), orange (trimmed)
Performance (TWR):
Historical performance (TWR):
2020: +110.2%(since 15.04.2020)
2021: +23.7%
2022: -59.6%
2023: +57.3%
Cumulative: +76.6%
A recap of my portfolio in 2024
January:
⬇️ Trim $ZS $CRWD $NET
⬆️Add $TSLA $TTD $MDB $AXON
March:
⬇️ Trim $NET $MNDY
✅ New position $GTLB ~3.1% (after -23% on ER)
May:
⬇️ Trim $CRWD $MNDY $DDOG $TTD
⬆️ Add $AXON
✅ New position $SHOP ~3.2%
June:
⬇️ Trim $CRWD $MNDY $MDB
⬆️ Add $NET $SNOW $TSLA $AXON $SHOP $GTLB
July:
⬇️ Trim $NET $MDB
⬆️ Add $CRWD
September:
⬇️ Trim $SNOW to ~6.2%
⬇️ Trim $MELI to ~6.7%
⬇️ Trim $TSLA to ~7.4%
⬇️ Trim $NET to ~9.2%
⬇️ Trim $MNDY to ~9.6%
⬇️ Trim $ZS to ~7.3%
⬇️ Trim $CRWD to ~7.2%
⬆️ Add $SHOP to ~6.0%
⬆️ Add $GTLB to ~4.9%
✅ New $NOW ~3.7%
✅ New $IOT ~2.4%
Based on the Q2 earnings reports, I reduced my positions in NET, MNDY, and ZS by about 1% and in MELI, TSLA, and SNOW by over 1%. I also made a small reduction in CRWD, roughly 0.3%, to open new starter positions in NOW and IOT, as well as to increase positions in SHOP and GTLB. Despite trimming, NET and MNDY remain my largest holdings. MNDY had an excellent Q2 report, and it is now the largest position in my portfolio. NET, however, delivered a less-than-ideal report, providing a weaker-than-expected forecast for the next quarter.
MELI is a higher-risk position for me, as the company operates in Latin America, including Argentina, and provides credit, which could become an issue in the event of economic instability in the region. TSLA stock has risen significantly on rumors of a new model release and preliminary approval for FSD in China. Given the price increase, I decided to trim the position.
SNOW delivered a decent Q2 report, but following the management’s statements about a conservative outlook, the company barely beat its own forecast and gave a weak outlook for the next quarter. The company needs to prove that new products like Iceberg will significantly contribute to revenue.
NOW and IOT reported excellent Q2 results, so I opened starter positions. My position in IOT remains limited to no more than 5% due to the high valuation. SHOP and GTLB also posted very strong quarterly results. SHOP may benefit from stronger-than-expected consumer activity and from the Fed’s interest rate cuts. For GTLB, GitLab Duo could drive growth, as management indicated it has been well-received by the company's customers.
Commentary on my holdings:
Cloudflare NET
Cloudflare has announced that it will make several key security tools, including its Zero Trust platform, Cloudflare One, available for free. These tools will help organizations of all sizes protect against threats such as credential leaks, supply chain attacks, and API vulnerabilities. The move aims to provide security teams with visibility and protection without the burden of expensive vendor renewals. By offering these features at no cost, Cloudflare could attract new customers who may eventually transition to using the platform's paid services.
Cloudflare has introduced Plexi, a new service to verify the integrity of public keys in end-to-end encryption (E2EE) messaging applications. Partnering with WhatsApp, Cloudflare's Plexi automates the verification process to ensure that encryption keys used in messaging are legitimate and haven’t been tampered with. This new auditing process builds trust in encrypted communications by removing the manual verification burden from users.
Cloudflare has announced new capabilities for its serverless AI platform, Workers AI, to help developers build faster and more efficient AI applications. With GPUs in over 180 cities worldwide, Workers AI offers low-latency inference and supports larger AI models, including Llama 3.1 and Llama 3.2.
New features include enhanced performance analytics, persistent logs for better monitoring, and an improved vector database for faster, more affordable AI queries. These upgrades position Cloudflare as a leading global platform for building scalable and performant AI applications.
Monday MNDY
Monday, has been recognized as a Leader in the 2024 Gartner Magic Quadrant for Adaptive Project Management and Reporting (APMR) for the third consecutive year.
Monday was evaluated based on its 'Ability to Execute' and 'Completeness of Vision,' where it was positioned furthest in both categories. The company continues to innovate, integrating AI into its platform and expanding its capabilities with new solutions like Portfolio management, mondayDB 2.0, and monday workflows, enhancing its offering for over 225,000 customers.
Datadog DDOG
Datadog, has announced the general availability of Datadog Monitoring for Oracle Cloud Infrastructure (OCI). This new service enables Oracle customers to monitor both cloud-native and traditional workloads, providing comprehensive visibility across OCI, hybrid, and multi-cloud environments. Datadog’s platform offers real-time insights into OCI services, applications, and infrastructure through customizable dashboards, helping customers monitor AI/ML workloads, track performance, and identify issues. This integration aims to facilitate smoother cloud migrations and multi-cloud strategies for Oracle customers.
Zscaler ZS
The company reported its second quarter of 2024 results.
Thoughts on Zscaler ER $ZS:
🟢Pros:
+ Revenue rose by +30.3% YoY; if the company beats the forecast similarly, revenue growth will be 27.6%.
+ DBNR at 115%, a slight decrease from last quarter.
+ Strong customer growth with $1M+ ARR added: +44.
+ Strong customer growth with $5M+ ARR +10, 40% YoY.
+ Company increasing margins and profitability.
+ Beat Q2 revenue guidance by 4.6%.
+ Solid Net New ARR added: (+159, +10% YoY).
+ New products contributed approximately 22% of new and upsell business in fiscal 2024.
🟡Neutral:
+- SBC/rev at 25%, Basic shares up 3.5% YoY.
+- Billings and RPO growth at 27%, lower than revenue growth, but RPO growth stabilized at last quarter's level.
+- Q3 guidance: +2.2% QoQ, which is lower than last year's forecast of +4.2%; revenue growth is still slowing down.
Market Reaction to Earnings Release: The stock price fell by 15% following the earnings release, likely due to the guidance for next year, which was in line with estimates.
The company's quarterly report was mixed. Zscaler beat its Q2 revenue guidance by 4.6%—the highest beat for Q2 among the companies I track. There was strong customer growth with $1M+ ARR and $5M+ ARR accounts. However, billings and RPO growth still lag behind revenue growth, DBNR slightly declined to 115%, and the forecast for the next quarter indicates a further slowdown in revenue growth. A key point for the company will be when revenue growth stabilizes.
Despite the mixed results, the company significantly exceeded its guidance for the quarter and added strong new customers, which gives hope that next year’s guidance was conservative and the company may exceed it significantly, as it has done in the past.
Zscaler, has appointed Adam Geller as Chief Product Office. Geller brings over 25 years of experience in cybersecurity, previously holding leadership roles at Exabeam and Palo Alto Networks. His expertise in product development and customer engagement will be key as Zscaler aims to expand its AI-driven security operations platform and reach $5 billion in ARR.
CrowdStrike CRWD
CrowdStrike has appointed Kartik Shahani as vice president for India and SAARC, where he will lead the company's go-to-market strategy to drive growth and customer adoption of the CrowdStrike Falcon cybersecurity platform. Shahani brings over 30 years of IT and cybersecurity experience, having previously led regional growth for companies like Tenable, Dell EMC, IBM, and McAfee. His appointment is expected to strengthen CrowdStrike's presence in the crucial India and SAARC markets.
CrowdStrike announced an expanded partnership with 1Password to enhance security for 150,000 small and midsize businesses (SMBs). The collaboration integrates CrowdStrike Falcon Go, an AI-powered cybersecurity platform, with 1Password's Extended Access Management (XAM). This bundled solution offers SMBs enterprise-grade protection against ransomware and data breaches, while simplifying security management and reducing costs.
CrowdStrike launched CrowdStrike Financial Services, a subsidiary offering tailored financing solutions for its AI-driven Falcon cybersecurity platform. This initiative aims to simplify platform consolidation, providing flexible financing options to enhance the adoption of CrowdStrike’s market-leading technology. Customers can combine these financing options with Falcon Flex, a licensing model that allows adaptable deployment of Falcon’s security modules. The service includes flexible payment plans, ecosystem support, and personalized customer service, streamlining the process of acquiring CrowdStrike’s solutions and ensuring a seamless experience.
CrowdStrike unveiled new AI Security Posture Management (AI-SPM) and announced the general availability of Data Security Posture Management (DSPM) as part of its Falcon Cloud Security platform, making it the only CNAPP that delivers comprehensive protection across cloud infrastructure, applications, data, and AI models. CrowdStrike also introduced enhancements to Falcon Identity Protection, including Falcon Privileged Access and real-time threat protection for Microsoft Entra ID, aimed at preventing identity-based and cross-domain attacks. These innovations provide real-time visibility and protection to secure hybrid cloud environments, reduce vulnerabilities, and stop sophisticated threats.
CrowdStrike announced several new innovations to its Falcon cybersecurity platform, aimed at unifying security and IT operations to stop breaches. Key updates include Project Kestrel, which provides a customizable, all-in-one view of security environments, and Falcon Signal, an AI-powered engine that enhances threat detection. The Falcon Cloud Security platform now includes AI Security Posture Management and Data Security Posture Management to protect cloud infrastructure, applications, data, and AI models. Falcon Identity Protection and next-gen SIEM were also upgraded with new capabilities, and Charlotte AI offers faster triage and response through conversational AI. These innovations simplify security operations, enhance collaboration, and reduce breach risks across cloud and IT environments.
CrowdStrike has been named a Leader in The Forrester Wave: Attack Surface Management Solutions, Q3 2024, ranking highest in the Current Offering category and receiving the top score in Market Presence. This recognition highlights CrowdStrike's AI-native Falcon cybersecurity platform, which consolidates tools and provides AI-driven vulnerability prioritization, reducing critical vulnerabilities by 98%. Key innovations include Network Vulnerability Assessment and Attack Path Analysis, enabling organizations to manage risk across complex IT environments and predict adversary behavior.
CrowdStrike has been named a Leader in the 2024 Gartner Magic Quadrant for Endpoint Protection Platforms (EPP) for the fifth consecutive time, ranking highest for Completeness of Vision and Ability to Execute. The company's Falcon cybersecurity platform, powered by AI, continues to redefine endpoint protection by offering advanced threat prevention, detection, and response capabilities. With a unified, single-agent platform that consolidates cybersecurity functions such as identity protection, cloud security, and IT automation, CrowdStrike aims to simplify cybersecurity and provide real-time protection across enterprises.
Compared to 2023, $CRWD has slightly reduced its lead over competitors, but it still maintains a leading position. $MSFT remains in roughly the same position, while $PANW and $S have slightly improved their standings.
Key takeaways from CrowdStrike Investor Briefing:
Customer Base: CrowdStrike serves a diverse array of clients, including over 70% of the Fortune 100, 18 of the top 20 banks, and 44 of the 50 U.S. states. The company enjoys strong customer loyalty, evidenced by a 98% gross retention rate. Despite challenges following the July 19 incident, CrowdStrike has maintained robust relationships, with many customers expressing appreciation for the company's transparency and support during the crisis. Expansion has been notable within large enterprises, while also achieving success with smaller customers adopting the Falcon Flex model. Notably, Global 2000 customer penetration increased from 30% to 35%.
Falcon Flex: The Falcon Flex subscription model has driven significant customer adoption and contract value increases. For example, a software company expanded its contract from $15 million to $110 million using Falcon Flex, representing a 350% ARR uplift. Another Fortune 500 company grew its contract value from $2.3 million over three years to $20 million over five years. This model simplifies module and endpoint expansions, reducing the need for multiple procurement cycles. CrowdStrike has further leveraged Falcon Flex through customer commitment packages, offering Flex dollars for additional modules, professional services, flexible payment terms, and subscription extensions—particularly after the July incident.
Next-Gen SIEM: CrowdStrike’s Next-Gen SIEM business has exhibited rapid growth, with ARR climbing from under $100 million to over $220 million, representing 140% year-over-year growth. The solution, now adopted by 2,000+ customers, benefits from its cost-effective, AI-powered architecture, which simplifies data ingestion via AI-driven parsers and accelerates response times through visualized incident workbenches, making it a favorite among SOC teams.
Key takeaways from CrowdStrike's presentation at the 2024 Goldman Sachs Technology Conference:
July 19 Incident: The July 19 incident led to significant disruptions. CrowdStrike immediately focused on transparency, communication, and accountability. The root cause of the incident was a configuration update, not a code or kernel-level change, which led to the problem. The software that caused the issue had been deployed in February after going through a robust QA process. The incident occurred due to a configuration update that affected telemetry sent back to CrowdStrike's cloud. The update had 21 configurations, but the sensor only understood 20, leading to the disruption. Changes have been made to CrowdStrike’s processes to ensure all configuration updates now go through the same validation and QA processes as code updates, and are rolled out in a phased manner. Going forward, customers will have the option to control how they deploy content updates.
Customer Engagement: Customer engagement skyrocketed post-incident, with George Kurtz engaging in an extensive number of customer conversations in a short period, more than compressing a year's worth of engagement into weeks. Customers, particularly senior executives, were very involved in discussions, focusing on understanding what had happened, why it occurred, and how CrowdStrike would prevent a recurrence. Kurtz noted that many customers appreciated the company's swift communication, and CrowdStrike's transparency was well-received, which helped maintain customer trust.
Observability: Observability, particularly with the LogScale technology (formerly Humio), is still in its earlier stages, according to Kurtz. The platform allows users to manage logs and data efficiently, with next-gen SIEM being a key use case. The platform integrates observability, giving customers the ability to log and query data faster, and has become popular for use cases like data lakes and real-time data ingestion.
Charlotte AI: Charlotte AI is CrowdStrike's generative AI tool designed to improve security operations. It is integrated into the Falcon platform as a foundational service, not just a chatbot, and automates various workflows. The primary goal of Charlotte AI is to turn Tier 1 analysts into Tier 3 analysts by automating repetitive tasks and incident report generation, reducing hours of work to minutes. Surprisingly, Tier 3 analysts, who are power users, have also embraced Charlotte AI, using it to save time on complex tasks. Early feedback on Charlotte AI has been positive, particularly from advanced users. It enables faster and more accurate security incident reports, gathering information about malicious files, where they came from, and which systems or identities were affected.
CrowdStrike was highly active following the July 19 incident, and the management demonstrated strong engagement. In my opinion, the company emerged stronger after the incident and proved its effectiveness in handling various challenges. Problems can arise for any company, but the key differentiator is how a company responds to those issues. This is what separates truly great companies from average ones. I believe that offering customers additional modules for free, instead of discounts, is a smart move. It not only attracts customers to try out these modules and potentially adopt them on a paid basis in the future but also avoids negatively impacting current revenue.
Snowflake SNOW
Snowflake has launched its AI Data Cloud for Travel and Hospitality, uniting its data platform and AI capabilities to deliver industry-specific solutions. The platform empowers travel businesses like airlines, hotels, and cruise lines to leverage data for improving operations, enhancing customer experiences, and optimizing outcomes such as personalized marketing, dynamic pricing, and crew coordination. With seamless data integration and collaboration, Snowflake aims to drive innovation and efficiency in the travel sector.
"By creating a unified data foundation on Snowflake, we're improving our ability to make data driven decisions and automate aspects of our business” said Raymond Boyle, Vice President, Data Analytics and Strategic Insights, Hyatt.
"Snowflake is an important part of Tripadvisor's data strategy," said Rahul Todkar, Head of Data and AI at Tripadvisor. "It unifies our enterprise analytics, marketing, and customer insights, providing the data foundation for our AI initiatives.
Snowflake Prices Private Placement of $2.0 Billion of Convertible Senior Notes. Snowflake announced the pricing of $1 billion each of its 0% Convertible Senior Notes due 2027 and 2029 in a private placement to qualified institutional buyers. The sale is expected to close on September 27, 2024. The net proceeds are estimated at $1.97 billion, potentially rising to $2.27 billion if additional notes are sold. Snowflake plans to use the funds for capped call transactions, repurchasing approximately $400 million of its Class A common stock, and general corporate purposes, including potential acquisitions or strategic investments.
Gitlab GTLB
The company reported its second quarter of 2024 results.
Thoughts on Gitlab ER $GTLB:
🟢Pros:
+ Revenue rose by +30.8% YoY; if the company similarly beats by 3.2%, the growth in the next quarter will be 29.6%, indicating revenue growth stabilization.
+ Strong DBNR at 126%, decreased from 129% last quarter.
+ Company increasing margins and profitability.
+ Increased FY guidance by 0.9%.
+ Strong next quarter guidance.
+ Growth in RPO and Billings has accelerated and is growing faster than revenue.
+ Added +51 $100k+ ARR customers, more than in Q2 last year.
+ Added nearly record New ARR: +53.6, growth 6% YoY.
+ GitLab recognized as a Leader in the 2024 Gartner Magic Quadrant for AI code assistant.
🔴Cons:
- SBC/rev at 27%. Diluted share count up 8.3% YoY.
🟡Neutral:
+- Weak number of $5k+ Customers added, the lowest level since the IPO.
Market Reaction to Earnings Release: The stock price increased by 16% following the earnings release.
The company’s quarterly report was strong. GitLab was recognized as a Leader in the 2024 Gartner Magic Quadrant for AI Code Assistants, which is an important achievement for the company. A solid number of $100k+ customers were added, and the growth of RPO and Billings has accelerated, now outpacing revenue growth. The forecast for the next quarter is strong.
GitLab has been recognized as a Leader in the 2024 Gartner Magic Quadrant for DevOps Platforms, distinguishing itself for its "Completeness of Vision" and "Ability to Execute." Additionally, GitLab is the only vendor named a Leader in both the DevOps Platforms and the AI Code Assistants categories by Gartner for 2024. The report highlights the benefits of DevOps platforms in reducing complexity, enhancing security, and accelerating software delivery. GitLab's platform supports organizations in their digital transformation efforts by improving software development, operational efficiency, and compliance, while facilitating faster cloud migrations.
ServiceNow NOW
ServiceNow has announced significant data enhancements to its Now Platform, including the introduction of RaptorDB Pro, a high-performance database aimed at improving scalability and transaction times. The platform's new features, such as a 53% faster overall transaction speed and 27x faster report generation, are designed to help businesses streamline workflows and access real-time insights. Additionally, ServiceNow plans to launch a unified Knowledge Graph in 2025 to connect enterprise-wide data for real-time personalization and improved decision-making.
ServiceNow has announced the integration of Agentic AI into its platform to enhance productivity across various business functions, including IT, customer service, procurement, HR, and software development. The AI agents will leverage advanced reasoning and contextual comprehension to collaborate with employees and customers, improving task management and reducing resolution times. ServiceNow also introduced the Now Assist Skill Kit, allowing businesses to create and deploy custom GenAI skills tailored to their needs. These innovations are part of the company's Now Platform Xanadu release, aimed at increasing productivity and enhancing enterprise collaboration.
Samsara IOT
The company reported its second quarter of 2024 results.
Thoughts on Samsara ER $IOT :
🟢Pros:
+ Revenue growth has stabilized at +37% YoY over the past three quarters; if the company similarly beats its forecast by 3.5%, as in Q2, next quarter's revenue growth will be 36%.
+ Dollar-Based Net Retention (DBNR) for $10k+ customers remains stable at 115%, and for $100k+ customers at 120%.
+ RPO grew by 40%, and cRPO grew by 37.5%, faster than revenue growth.
+ Strong addition of $100k+ customers, with +169, likely a record increase in customers if not accounting for the extra week in Q4 2023.
+ Net New ARR added +80, +10% YoY.
+ The company significantly improved business margins over the past year: FCF margin increased from 2% to 4%, and Non-GAAP operating margin improved from -2.7% to +2.8%.
+ Non-GAAP gross margin at a record level 76.9%.
+ Samsara is strengthening its management: Elyssa Henry joined Samsara's Board of Directors, and Megan Eisenberg was appointed as Chief Marketing Officer.
+ Beat Q2 revenue guidance by 3.5%.
+ FY 2024 guidance increased by 1.2%.
+ The company introduced new products: Connected Workflows (to digitize and orchestrate multi-step workflows) and Connected Training (facilitating remote training opportunities via the Samsara mobile app).
+ Asset Tag (Bluetooth asset tag for tracking) achieved approximately $1M in net new ACV in its first quarter.
🟡Neutral:
+- SBC/rev at 25%, decrease 4 PPs YoY.
+- Diluted shares up 2.3% YoY.
Market Reaction to Earnings Release: The stock price increased by 13% following the earnings release.
The quarterly report was indeed strong, with revenue growth maintaining a consistently high level of +37%. The company added a strong number of $100k+ customers. RPO and cRPO grew faster than revenue. The new product, Asset Tag, delivered solid results in its first quarter after launch. The company also strengthened its management team.
Samsara announced a new integration with Esri to improve fleet management and real-time reporting for government agencies. This integration allows public sector organizations to use Samsara’s telematics data within Esri's ArcGIS Velocity, enhancing operational efficiency and safety. The partnership enables real-time visibility, optimized emergency responses, and detailed post-event reporting. Samsara aims to eliminate data silos and streamline fleet operations for government services, while Esri’s tools provide spatial analytics for better decision-making. This integration is now available globally to customers.
Thank you for reading!
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