Dear Family Office Investment Committee,
(For those of you wondering “wtf is this and why is it interrupting my sports, gambling, and Smokeshow blogs?"… meet Barstool Finance and Barstool’s newest show (I think), THE FAMILY OFFICE. The idea is pretty simple: Large and I are investing $5,001 for your entertainment. Our goal? 44% annual returns. Along the way we'll discuss investments, markets, and Large will probably drink on-air. This is an update on what investments we’re keeping an eye on this week.)
Working with Large on The Family Office is a dream come true. Not many people get to work with their heroes. So what if my heroes write blogs like “Annual Reminder That Forrest Gump’s Mom Was Kind Of A Whore”?
That’s what made it all the more difficult to watch the big man unravel on air. Every week Large and I discuss our watch list (investments opportunities we’re keeping an eye on). On the July 5th Family Office Large came from the clouds with a stock pick. I’m paraphrasing…
Like anyone who has had an idea that ended with “what’s the worst that could happen?”, Large and I talked ourselves into the trade. It was set to report earnings on July 7th. It had beaten easily in the previous quarter, but more importantly, WD-40 just screamed “recession-proof.” And it made sense (at the time)...
You’re going to be poor af when you lose your job during the upcoming financial apocalypse. Your car will likely be repossessed, making bike maintenance paramount for getting to and from the local food bank.
- WD-40 has become synonymous with industrial grade lubricant. It's the Kleenex of the hardware store. That's like height in a basketball player… you can't teach it.
Well, we added the stock to The Family Office portfolio on Wednesday, July 6th at about $198. Earnings dropped on Thursday after the close, and we got rekt. It missed earnings expectations, and lowered guidance for the rest of the year because “SupPlY CHaIn IsSuEs.” We still hold WDFC but are down ~15% on the position.
Large did not take the news well. He drowned his sorrows with, of all things, Captain Morgan, which just made it even sadder and harder to watch, while simultaneously putting on a MASTERCLASS in how investors interpret earnings…
So what’s on our watch list this week?
+ US Treasury Series I Savings Bonds. These are the things CNBC clickbait is made of (coincidentally, this is how I stumbled upon these bad bitches). These savings bonds are the stuff of your grandparent’s wet dreams: a 9.62% guaranteed semi-annual return.
"BuT It SEeMs tOO GoOd To BE TrUE" - you, probably
Turns out these things are actually yielding this much because of the absolute nightmare scenario we’re in right now. The interest rate is calced using the following formula:
Some paltry fixed rate + the Consumer Price Index aka CPI (friendly reminder: that’s an inflation indicator).
CPI just came in at 9.1%, meaning prices of consumer goods rose 9.1% vs. the same period last year. That's a 40-year high. So, yeah, not great, Bob. While upside is limited on these things, it’s certainly better than the -21% the S&P 500 is putting up so far this year.
+ Rocky Mountain Chocolate Factory (RMCF). I don’t know much about this stock, and actually only found out the company existed when I was looking through upcoming earnings. FYI, it’s a ~$40M market cap candy maker, with, you guessed it, its HQ in the Rocky Mountains.
So, why’s it on the watch list? Because its name is funny as fuck. Remember in high school when you earned social credit on the school bus by being the first person to tell your buddies about the most disgusting sexual conquests (that you've never done)? The Rusty Trombone, Superman-ing, the Dirty Sanchez come to mind. Well, the Rocky Mountain Chocolate Factory jumped off the page as a euphemism for some sort of butt stuff that gave 15-year-old me a half chub.
+ Meta/Facebook (META). Pretty simple. Facebook's stock has gotten beaten up worse than that guy who attacked Chappelle on stage. It's down 52% this year. It still manages to print money via its ad monopoly (or, I guess duopoly with Google). Of course, there's a reason it's taken its lumps. There are fears that the metaverse bet could go the way of Quibi… and/or ad spend could dry up quicker than your girl when you start talking about your newest NFT.
+ Getting pregnant by Elon Musk. Rapper Curtis “50 Cent” Jackson said it best: “have a baby by me, baby, be a millionaire.” Well, Elon is out here slingin’ billion dollar seed to anyone with a pulse and female genitals in hopes of repopulating the world. You might recall that when he isn’t busy considering billion dollar social media platform takeovers, he’s getting his employees pregnant. And, in this market, it might be the only safe bet. Granted, it’s not without risk… most of Elon’s wealth is tied up in Tesla, which continues to be assaulted by supply chain issues and rising interest rates.
Plus one recent addition…
+ Monster Beverage Corp. (MNST). Get your Kyle punching a hole in dry wall jokes ready. More on this in next week's episode.
Have an idea to add to the watch list? Large and I need all the help we can get. You can pitch us investment ideas HERE.
As a reminder, The Family Office's current portfolio includes…
A new episode of The Family Office drops every Monday at 6 AM, just in time for your shitty commute. Catch up now.
Snap Necks and Cash Checks,
NOTE: This is not financial advice. Tyler is a MORON. All opinions expressed in this blog, including those of Tyler Morin or any other contributors are solely the writers’ opinions. Their opinions are based on information they consider to be reliable at the time they are made, but they are under no obligation to update or correct any information provided. Tyler Morin and any other contributors may hold positions in the securities discussed, including positions not discussed in this blog. Nothing in this blog constitutes a recommendation that any investment or strategy is suitable for you, but are made solely for educational or informational purposes. This blog is not an offer to sell or a solicitation of an offer to buy any securities. Past performance is not indicative of future results. Investments or strategies mentioned in this blog do not take into account your particular investment objectives, financial situation or needs. Before acting on information in this blog, you should consider whether it is suitable for your particular circumstances.