Tesla, Twitter, and Elon Musk

In this episode, Cathie Wood, CEO of ARK Investment Management, joins Melissa Francis and Magnifi by TIFIN to discuss her views on Tesla, Twitter, and Disruptive Innovation.

Watch the Full Interview at Magnifi by TIFIN

Melissa Francis
Welcome everyone today. We're here to talk about Magnifi by TIFIN a marketplace, where you can harness real-time proprietary data to help individual investors and financial advisors find, compare, and buy investment products like stocks and ETFs mutual and model portfolios to grow and preserve your wealth. I'm Melissa Francis. I know just a little bit about this subject matter. I'm a former CNBC MSNBC Fox business and Fox news anchor. And you will remember if you've watched us before we talked about the best crypto investment strategies with Anthony Scaramucci, the best bond with the bond king himself, Jeffrey Gunlock, and the best private equity strategies with Marty Neite. Now we have a very special guest that I am super excited about to talk about stocks, um, and everything hot out there, Kathy Wood. She's the CEO of arc. She is a board member of TIFIN, which is Magnifi's parent company, Kathy.

Melissa Francis
So thank you so much for being here. I wanna drill down on your latest blog because there were so many good nuggets in there, and I found some of them kind of counterintuitive. So I wanna get into those, but first, if I could take you to the hot story of the day, which of course is Twitter. And I wanted to ask you, um, looking at where things stand today, and I know as fast-moving, it keeps changing, but, um, if you were Elon Musk, what would your next move be? What would you do from here?

Kathy Wood
Well, he's got a $54, I guess it's $54 and 20 cent offer out there. Uh, so I think he'll buy it his time. It will be interesting to see if other bidders, uh, show up. I'm uh, I'm hearing that there are some, so let's see. Not, not quite sure it's still quite fluid, right?

Melissa Francis
Yeah, no. And he says that if this doesn't work, he has plan B what do you think that is?

Kathy Wood
Goodness, I don't know if it would be something a little more hostile. Just I have no idea, you know, uh, Elon Musk is, has his own mind and, and is, uh, and I'm sure thinking very creatively about this.

Melissa Francis
If he does succeed and you, or him again, what would you do with the company? What do you think they need to correct?

Kathy Wood
Well, one of the things that, uh, I think has hampered Twitter is its advertising model and this is what scares, uh, analysts out there. Oh my gosh. You know, uh, he's going to upend the advertising model, uh, because advertisers don't like to be, uh, to have their ad shown next to questionable content, which is something different for everyone, right? Uh, and so this idea of perhaps a subscription service is a possibility or a tipping service, uh, but certainly open sourcing. The algorithm will be the first thing he'll do, uh, so that, uh, the there's transparency associated with what is and is not censored.

Melissa Francis
So do you think that's a good or a bad thing for the company? I mean, it might be a good thing for freedom of speech or however, may you, you may look at it politically, but if you were a shareholder, is it a good idea for him to get that out there? So everybody knows how the algorithm really works?

Kathy Wood
Well, I think even Jack Dorsey thought that Twitter was beginning to tie itself in knots over censorship. And, so he was trying to figure out what can we do to overcome this monster really. And, uh, so I think they do need to do something. Um, uh, many people would describe what's happened to te uh, Twitter as, uh, becoming us pool. Now we don't think that we use Twitter. Uh, it's, it's become quite important to our business as have other social media, uh, platforms. Uh, and so we know that we can unfollow someone, uh, that is hampering our research or our ability to engage with others in a civil way. Um, but I, I think that, um, I think that even Jack was saying, okay, we need a change. We have to change what we're doing. And I think he and Elon probably are aligned, uh, and this idea of an open-source algorithm, a shift away from the advertising model towards something, uh, more or subscription-based and, you know, more transparency. I mean, uh, Ark is radically transparent. Everything we do, uh, is transparent and it has done nothing but help our business. Sure. You've got, uh, people out there who are, um, denigrating our work. Uh, but we know those people as, as we drill into what they're saying, they're not doing any research. We're really interested in engaging with people who are doing real research. Uh, and I think transparency, uh, would make that make, uh, our experience with Twitter even better.

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Melissa Francis
Yeah. The fact that you're not afraid to engage like that and to, you know, hear from those who might pose you shows how confident you are about what you're doing. You have to wonder about a company that wants to hide what they're doing. Let me ask you though, on, on the Twitter front, um, so what do you think the company's worth? I mean, I know I wanna talk to you about your Tesla target, but as you look at what Elon's willing to pay, um, what do you think if you had to put a price target on the stock two years down, or four years down the road, what would you say?

Kathy Wood
Well, I think there's so much uncertainty right now that I couldn't give you one. Um, based on their existing model, our compound annual rate of return expectation, uh, for Twitter is, uh, roughly 25%. Now, their model's going to change. There are going to be a lot of dislocations. We have a lot of very short-term-oriented shareholders who are probably now have moved into Twitter to make a fast buck, 54, uh, 20, $54, and 20 cents. Uh, but the model's going to change. And so we will revisit once we understand what's going on, we will revisit the upside to the model. And we do think that, uh, uh, a lot can be done to improve the model. So, it may take more time than even our five-year investment time horizon.

Melissa Francis
So it, if you, if Elon Musk does get control of the company, would you adjust that upward? Do you think it has more potential with him in charge or would it be more of a wait and see, how would you feel?

Kathy Wood
We probably would have more confidence in the platform, uh, would want to hear what Elon, um, uh, has, in mind in terms of perpetuating the platform. Uh, I'm sure he does not want to run it as a charitable organization or a nonprofit. So we'd like to see how he thinks it could become a very transparent, but also self-sustaining, uh, model. And, you know, he's very creative and I think that it is our global town square and, and that a lot of people would miss it. Uh, so, uh, I think there would be a lot of people, very supportive and very open to his ideas.

Melissa Francis
So putting politics aside entirely, and just thinking about pure money as a shareholder, you would be in favor of Elon Musk taking over?

Kathy Wood
Well, I do think that, uh, the route Jack was going, which we supported was opening up the algorithm or open-sourcing it in some way. Um, and, and so I think this is a continuation of that. We also think one of the reasons we have held Twitter is because we believe, uh, it is a verification platform, you know, the little blue check, and we believe that it could become a verification platform for NFTs as well. Uh, and so, you know, there, there are a few call options here, and, uh, there are verification algorithms we think are well respected out there. And, uh, so I think, uh, Elon would also build on that.

Melissa Francis
Wow, fascinating stuff. That's great. I'm sure you just made some news there without question before we stray too far from Elon, because he is such a fascinating character. I know that you put a 20, 26 target on Tesla of $4,600. How did you work that math and how do you feel about that call?

Watch the Full Interview at Magnifi by TIFIN

Alibaba VS. Amazon - Which One You Should Buy

Hello traders and MarketClub members everywhere! Today, I will be looking at Tesla (NASDAQ:TSLA), who just announced their earnings and future growth prospects and Alibaba (NYSE:BABA), who just made new highs yesterday, since going public in its recent IPO offering. I will also be delving into Amazon (NASDAQ:AMZN) and analyzing if the love affair is over.

Alibaba Group Holding Limited (NYSE:BABA)
Alibaba is an amazing company, started by Jack Ma not that long ago. Its recent IPO on the NYSE raised a record amount of funds for this company and made Jack Ma an overnight billionaire. So what does Alibaba actually do? This company acts and provides a platform to merchants to sell to their half a billion users that frequent their website. Alibaba's master plan is to be the biggest commerce website in the world. That leads me to another website that has similar plans.

Amazon.com, Inc. (NASDAQ:AMZN)
Amazon, who is undoubtedly the king of online commerce here in the United States, continues to grow, but continues to lose money. Amazon continues to pour money into the development of several other businesses, including cloud and server hosting for companies. Amazon's greatest asset, in my opinion, is the amount of information they have on everyone who has ever purchased goods and services from their website. This is an invaluable resource for marketing, not just for Amazon, but for any company they choose to work with. Continue reading "Alibaba VS. Amazon - Which One You Should Buy"

Five Aussie Companies with Cash Flows, Low Costs and MOUs

The Mining Report: Australian mining shares had a great July. Was that a one-off or indicative of a trend?

Luke Smith: July tends to be good because the fiscal year-end for most personal investors in Australia is June 30, so there is tax-loss selling up to that date. That said, this July was better than average. The gains slowed down at the end of the month, but we've seen a liftoff again from the middle of August. Hopefully, this trend will continue, and we'll see the revival of Australia's small-resources sector.

TMR: Asian countries such as China and Indonesia are moving toward added-value mining. What implications does that have for Australian mining?

LS: Indonesia is a large supplier globally of tin, nickel and pig iron. The decrease in tin from there is counteracted to some degree by Myanmar becoming a tin producer overnight. The decrease of Indonesian nickel has already been positive for Australian nickel producers and explorers and the nickel price on the London Metals Exchange.

"Syrah Resources Inc. owns the Balama project, which contains close to 1.2 Bt with about 10% total contained graphite."

TMR: Newcrest Mining Ltd. (NCM:ASX), Australia's biggest gold miner, has suffered a lot of bad news lately, including a $2.5 billion ($2.5B) write-down and a class action suit. To what extent do its woes mirror that of Australia's gold industry as a whole? Continue reading "Five Aussie Companies with Cash Flows, Low Costs and MOUs"

Time To Buy Tesla

Yesterday, Tesla Motors Inc. (NASDAQ:TSLA) flashed a buy signal at $229.78. This put all three Trade Triangles in a positive trend.

The RSI indicator moved over the 50 level, which is also another strong confirmation. I view that action as the continuation of a strong upward trend for Tesla.

CHART LEGEND
1. Long-term positive trend line
2. All Trade Triangles are positive
3. Weekly buy Trade Triangle yesterday
4. The RSI indicator is now over 50
5. Upside target zone of $300

Technically, I can see Tesla Motors Inc. (NASDAQ:TSLA) moving to the $300 range. Look for near-term resistance around the $240 and $260 levels.

Every Success,
Adam Hewison
President, INO.com
Co-Creator, MarketClub

Did Tesla Just Make A Classic Candlestick Bottom?

I first learned about candlestick charts when I was speaking in Tokyo on the US markets in the late 80's. I was immediately fascinated by this form of charting I had never seen before. It was similar, but so different from the way I was looking at regular Western charts.

What I like about the Japanese candlestick charts is the interesting names they have for them and the patterns that immediately tell you where the market opened and closed for the day.

At MarketClub, when you have a blue candlestick bar, it indicates the market opened lower for the day, then closed higher. When it's a red candlestick bar, it is just the reverse, indicating that the price opened higher, then closed lower for the day. This is very valuable information, information that you can use time and time again.

During my stay in Japan, I learned later that candlestick charting has been around for centuries and it was originally used to chart and track rice prices. Now, this same form of charting is used for practically every traded market in the world today.

Japanese candlestick charts differ from Western charts as they are much more visual and descriptive than Western charts. Besides the more advanced formations on candlestick charts, they also have such interesting names like "hanging man," "hammer," "dark-cloud cover" and "morning doji star." I could go on, but I think you get the picture. The names of these formations are very colorful. Continue reading "Did Tesla Just Make A Classic Candlestick Bottom?"