At Spaceship we’re long-term investors, but we still keep an eye on what’s happening in the markets day to day.
This week, we’re taking a look at some of the bigger movements in our Spaceship Voyager portfolios from the month of May 2024.
Moving up
First Solar
Rose 50.51%
First Solar is an American solar technology company that's fighting against climate change. It was founded in 1999.
First Solar is in the Spaceship Earth Portfolio.
Why did First Solar stock go up?
In a phrase: Headline news
“The main industry body for China’s solar companies, which dominate global supply chains, called for an end to a profit-slashing price war.”
This led to a bump in a number of US solar stocks, First Solar included.
First Solar also benefited from top investment group UBS predicting that its earnings could soar around 370% by 2027 thanks to the AI boom.
Birkenstock
Rose 24.31%
Birkenstock is a footwear brand that’s been around for more than 250 years. It listed on the stockmarket in 2023.
Birkenstock is in the Spaceship Universe Portfolio and the Spaceship Galaxy Portfolio.
Why did Birkenstock stock go up?
In a phrase: A strong result
The brand extension of Birkenstock into non-sandal products (with closed shoes now accounting for 25% of sales) is boosting demand year-round and commands higher average prices compared to their sandals.
Birkenstock shoes hardly ever go on sale which helps profit margins. According to management threre’s “full price realisation of over 90% at key distribution partners.”
The company reported its quarterly earnings on 30 May 2024, in which its CEO, Oliver Reichert, noted that “demand continues to outpace supply in all segments, channels, and categories,” causing them to update their earnings expectations to be even better than they first predicted.
Nvidia
Rose 23.89%
When Nvidia invented the Graphic Processing Unit (GPU) in 1999 it ended up being a huge deal: first it helped kickstart gaming and revived video graphics, and then it threw fuel on the AI fire: the GPU acts as the brain of digital products, including ChatGPT.
GPUs can process many pixels on a gaming screen rendering pixels in parallel all at once, a transferable technology for crunching large amounts of data – perfect for AI applications.
Nvidia is in the Spaceship Universe Portfolio, the Spaceship Earth Portfolio, the Spaceship Origin Portfolio, and the Spaceship Galaxy Portfolio.
Why did Nvidia stock go up?
In a phrase: Outpacing expectations
We’ve previously called Nvidia the ‘Beyonce of stocks’ because it never seems to stop delivering.
Its May earnings report delivered on 22 May 2024 was no different, when it announced record quarterly profit and a stock split.
Nvidia’s speed of innovation and of launching new chips is making it a challenge for competitors to keep up.
Jensen Huang, CEO, said “We’re poised for our next wave of growth.”
Mercado Libre
Rose 15.50%
Mercado Libre is a Latin American fintech that provides an online commerce and payments ecosystem.
It launched in 1999.
Mercado Libre is in the Spaceship Universe Portfolio and the Spaceship Earth Portfolio.
Why did Mercado Libre stock go up?
In a word: Earnings
Off the back of announcing its intention to increase headcount by 30% in April, Mercado Libre announced its quarterly earnings on 2 May 2024 from Montevideo, Uruguay.
Its result was better than expected, beating market expectations with first-quarter net profit that increased 71% from the year before.
Enphase Energy
Rose 14.82%
Enphase Energy was founded in 2006. It produces clean energy systems which utilise its microinverter solar tech to power homes around the world.
Enphase Energy is in the Spaceship Universe Portfolio, the Spaceship Earth Portfolio, and the Spaceship Galaxy Portfolio.
Why did Enphase Energy stock go up?
In a word: expansion
Enphase is continuing to expand into Europe, and on 21 May 2024 announced it had chosen Finland to launch its IQ8 Microinverter, which is its latest and most powerful microinverter. Enphase said that Finland’s installed solar capacity is expected to nearly triple by 2030.
Then US President Joe Biden announced he was doubling the tariff on Chinese solar imports, from 25% to 50%. This move is aimed at bolstering the domestic market which is good for Enphase.
Then Enphase ended the month by launching its IQ Battery in Mexico, which it calls its most powerful home battery to date.
Moving down
Cloudflare
Fell 24.38%
Cloudflare is a software company that has a network that can improve the security, performance, and reliability of internet connected devices.
Cloudflare is in the Spaceship Universe Portfolio, the Spaceship Earth Portfolio, and the Spaceship Galaxy Portfolio.
Why did Cloudflare stock go down?
In a phrase: slowing growth
Cloudflare shares took a tumble after the company announced its quarterly earnings on 2 May 2024.
The company noted that its expectations for future growth remain unchanged at 27% vs 2023; and Motley Fool notes that while 27% is still good, it’s less impressive than the 50% growth rates Cloudflare investors had become used to.
Shopify
Fell 17.73%
Shopify exists to make it easier for everyday people to start, run, and grow their businesses.
It has a platform and services that help its customers sell to their customers all over the world.
Massive companies like Mattel and Netflix have used Shopify to help run their businesses.
Shopify is in the Spaceship Universe Portfolio, the Spaceship Earth Portfolio, the Spaceship Origin Portfolio, and the Spaceship Galaxy Portfolio.
Why did Shopify stock go down?
In a phrase: Guidance of slowing growth
Shopify’s GMV (gross merchandise value, a measure of how much product a consumer business sells over time) grew 23% year over year in the most recent quarter, off a high base.
Net revenue grew 20%. Shopify has a free cash flow margin of 12%.
The market did not like the guidance of slowing growth going forward (mid teens rather than over 20%), or the higher than expected operating expenditure. The stock has been volatile, partly because it is a high multiple stock and has never been cheap.
As a business, Shopify has over 10% share in US e-commerce, enables multiple merchants of all sizes to run their e-commerce stores, and has built a sticky platform and a robust monetisation tool particularly through payments.
We note the company has a strong balance sheet with a net cash position, is expanding to larger merchants, expanding overseas, enabling cross-border expansion for their merchant partners, expanding offline through point of sale, and continuing to ramp up Shop Pay.
Illumina
Fell 17.25%
Illumina's a healthcare company dedicated to unlocking the power of the human genome, which could help advance the quest toward personalised medicine.
The company was founded in 1998, and has helped to make DNA sequencing more accessible and affordable.
Illumina is in the Spaceship Universe Portfolio, the Spaceship Earth Portfolio, and the Spaceship Galaxy Portfolio.
Why did Illumina stock go down?
In a word: earnings
Illumina reported quarterly earnings on 2 May 2024 that showed a dip in revenue and confirmed the company’s expectations for ‘flat’ guidance vs. the year before.
The company is seeing less demand for its newly launched genetic sequencing machines and is going through a messy process of spinning out a subsidiary called GRAIL, which it expects to complete on 24 June 2024.
Audinate
Fell 16.65%
Audinate is a leading provider of professional AV networking technology.
It's a Sydney business that was spun out of the CSIRO to become a global AV protocol that delivers uncompressed, multi-channel, low latency digital audio over an ethernet network.
Its flagship product Dante has been used to power some of the biggest music events in the world, including the Foo Fighters, the Killers, and Paul McCartney, while music product leaders such as Yamaha have adopted their AV technology.
Audinate is in the Spaceship Universe Portfolio and the Spaceship Galaxy Portfolio.
Why did Audinate stock go down?
In a word: retirement
Audinate announced on 27 May 2024 that its Chief Financial Officer (CFO) and Company Secretary would be stepping down for personal reasons. He’d been with Audinate since 2017.
Lululemon
Fell 15.52%
Lululemon creates innovative fitness and athleisure wear. It opened in 1998.
The company says its purpose is to elevate human potential by helping people feel their best, and this extends to its Impact Agenda, which uses the three pillars of Be Human, Be Well, and Be Planet to be good global citizens.
Lululemon is in the Spaceship Universe Portfolio, the Spaceship Galaxy Portfolio, and the Spaceship Earth Portfolio.
Why did Lululemon stock go down?
In a word: resignation
Lululemon’s chief product officer Sun Choe announced her departure from Lululemon to go be the Global Brand President of Vans.
The market hates uncertainty, and key people leaving results in a void that can take some time to fill.
Keep in mind
Our investment philosophy at Spaceship is to invest “where the world is going.”
Essentially, we use our Where the World is Going methodology to identify what we think are forward-thinking companies that will benefit from future trends. If they meet the criteria in our methodology — that is, they have competitive advantages and future growth potential — we will then consider those companies for our Spaceship Universe, Spaceship Galaxy, and Spaceship Earth portfolios. (For the latter, the companies must meet other criteria.)
So while short-term movements are interesting, we remain focused on long-term trends. You can find out more about the long-term trends we’ve identified as Where the World is Going in our Spaceship Universe, Spaceship Earth, and Spaceship Galaxy portfolios, and in the Spaceship app.
Some of our Spaceship Voyager portfolios invest in First Solar, Birkenstock, Nvidia, Mercado Libre, Enphase Energy, Cloudflare, Shopify, Illumina, Audinate, and Lululemon at the time of writing.
Important! We’re sharing with you our thoughts on the companies in which Spaceship Voyager invests for your informational purposes only. We think it’s important (and interesting!) to let you know what’s happening with Spaceship Voyager’s investments. However, we are not making recommendations to buy or sell holdings in a specific company. Past performance isn’t a reliable indicator or guarantee of future performance.
