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 July 2024.
(These figures refer to 1-31 July 2024, are converted in Australian dollars and are not annualised.)
Here’s the short version:
Moving up:
- TOMRA Systems +40.54%
- Zip +30.82%
- Generac +20.47%
- Illumina +20.17%
- Tesla +19.99%
Moving down:
- Crowdstrike -38.07%
- Lululemon -11.40%
- Uber -9.24%
- Eli Lilly -9.11%
- Advanced Micro Devices -8.87%
Moving up
TOMRA Systems
Rose +40.54% (from 1-31 July 2024, converted in Australian dollars and not annualised.)
TOMRA was founded in 1972 in Norway, when two brothers worked out a system to help a local grocer accept empty bottles in exchange for cash.
They invented the world's first automated reverse vending machine – and now people can 'return and earn' from taking their empty bottles and cans back to be recycled, all over the world.
Why did TOMRA stock go up?
In a word: results
TOMRA Systems reported quarterly earnings which included a 15% revenue increase on its Collection division, and the meeting of expectations for its Recycling and Food divisions.
TOMRA maintains good growth margins, which is a measure that compares a company’s profit against its revenue. Generally, the more profit you’re able to retain, the better your margins are, the better it is for your company and investors. TOMRA’s gross margin was 44% in Q2 2024, up from 42% vs. the year before.
TOMRA is in the Spaceship Earth Portfolio.
Zip
Rose 30.82% (from 1-31 July 2024, converted in Australian dollars and not annualised.)
Zip's an Australian company that's been around since 2013.
Its mission is to disrupt the broken credit card model by offering buy now, pay later payment solutions.
Why did Zip stock go up?
In a word: momentum
Zip was our biggest mover in June 2024 and it’s continued its rise.
It announced quarterly results on 17 July 2024 that showed improvement across pretty much all lines, and a reduction in bad debts.
They’re also killing it in the US, and have appointed Kelsey Plum from the WNBA as a brand ambassador for further exposure. She has massive reach with over a million followers.
Zip is in the Spaceship Universe Portfolio, and Spaceship Galaxy Portfolios.
Generac
Rose 20.47% (from 1-31 July 2024, converted in Australian dollars and not annualised.)
Generac designs and creates residential, commercial, and industrial power generators. It also has a suite of clean energy products.
Why did Generac stock go up?
In a phrase: a big month
Generac announced that it had been awarded a $200 million grant from the US Department of Energy to help install solar and battery storage systems for Puerto Rican households.
Then it announced second quarter results, in which the company updated their growth estimates, which means they’re forecasting better sales than they previously had. The market took note.
Generac is in the Spaceship Earth Portfolio, and is available in our US Investing Service.
Illumina
Rose 20.17% (from 1-31 July 2024, converted in Australian dollars and not annualised.)
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.
Why did Illumina stock go up?
In a word: acquisition
Illumina bought a company called Fluent BioSciences, which has developed a single-cell technology.
The acquisition is intended to “advance our multiomics growth strategy,” according to Illumina’s Chief Technology Officer, Steven Barnard.
Multiomics is pretty tricky to understand, but essentially it’s an advanced sequencing method that can combine data from different biological sources and past experiments.
You can check out Illumina’s explanation at their multiomics explainer page.
Essentially, this acquisition helps to further power and differentiate Illumina from its competitors.
Illumina is in the Spaceship Universe Portfolio, the Spaceship Earth Portfolio, the Spaceship Galaxy Portfolio, and is available in our US Investing Service.
Tesla
Rose 19.99% (from 1-31 July 2024, converted in Australian dollars and not annualised.)
Tesla was founded in 2003, with the mission to accelerate the world's transition to sustainable energy. Its products have included electric cars, batteries, and solar energy panels.
Why did Tesla stock go up?
In a word: automation
Shares continue to climb following last month's vote to reinstate CEO Elon Musk's pay package, which we and the market believe will ensure his continued involvement in Tesla's AI and robotics initiatives.
Tesla is also planning to unveil its robotaxi strategy, although the company postponed its launch from August until October.
Tesla is in the Spaceship Universe Portfolio, the Spaceship Earth Portfolio, the Spaceship Origin Portfolio, the Spaceship Galaxy Portfolio, and is available in our US Investing Service.
Moving down
CrowdStrike
Fell -38.07% (from 1-31 July 2024, converted in Australian dollars and not annualised.)
CrowdStrike is a cybersecurity company that helps its customers defend themselves against cyber threats, such as hacks and data breaches. CrowdStrike went public in 2019.
Why did CrowdStrike go down?
In a word: outage
CrowdStrike’s cybersecurity detection product is called Falcon and it’s distributed via the cloud to massive companies globally. CrowdStrike released an update to Falcon that resulted in an operating system crash on connected Windows systems, and triggered outages across different businesses and industries around the world.
They figured out what went wrong and issued a fix. It’s normal for tech companies to conduct Post Incident Reviews and CrowdStrike is sharing theirs publicly, which you can see here.
We reduced some of our holdings following the news. Although the event was negative, our analysis of the competitive landscape indicates that there are few viable endpoint security alternatives, so we are considering re-adding to our CrowdStirke position at a favorable level.
CrowdStrike is in the Spaceship Universe Portfolio, the Spaceship Earth Portfolio, the Spaceship Galaxy Portfolio, and is available in our US Investing Service.
Lululemon
Fell -11.40% (from 1-31 July 2024, converted in Australian dollars and not annualised.)
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.
Why did Lululemon stock go down?
In a phrase: missed expectations
Lululemon’s stock has lost more than half its value in the year to date, at the time of writing. The weakness can be attributed to several factors including increased competition, departure of the Chief Product Officer, changing consumer trends, a perceived slowdown in consumer discretionary spend, and a high valuation towards the end of last year. Lululemon hasn’t met the wider market’s expectations, which has contributed to the sell-off. It’s been a tough market for retail generally, which you can read about in our 2024 Spaceship Voyager Investor Letter.
In July, Lululemon had a rare misstep with a product release. It premiered a new line of leggings it called Breezethrough. They were intended to be lightweight, with quick drying materials. Unfortunately, they featured a V shaped seam on the backside that had the unintended impact of giving customers ‘long butts’. Customers weren’t that stoked on them, and rather than being the butt of a joke, Lululemon heard the feedback and pulled the product from the shelves.
Lululemon is in the Spaceship Universe Portfolio, the Spaceship Earth Portfolio, the Spaceship Galaxy Portfolio, and is available in our US Investing Service.
Uber
Fell -9.24% (from 1-31 July 2024, converted in Australian dollars and not annualised.)
Uber began when two friends got stranded in Paris, couldn't find a taxi, and asked each other, "What if you could request a ride simply by tapping your phone?"
A couple of months later, in 2009, the rideshare company launched that let customers do just that.
Why did Uber stock go down?
In a word: Valuation
Uber had a large run-up after it was included in the S&P500 in December 2023.
Its valuation seems to be correcting in line with the macro environment, again with expectations of an increased slowdown in consumer spend.
Uber released its earnings report in early August, which showed strong results. Its gross bookings were up 21% in 2Q23 year over year, and it reported record profitability.
Eats is fast approaching the GMV level of Rides, although it’s still only around one-third of the EBITDA of Rides. Uber’s ramping up its One membership, and has increased its advertising revenue run rate to more than $1 billion (ads is a very high margin business).
Uber is also investing to grow its business in grocery, alcohol, and convenience.
While the stock may be volatile with a perceived slowdown in consumer spending and consequently the earnings, we think Uber is in a market leadership position and has a long runway of growth ahead.
Uber was one of the top performing Spaceship Voyager stocks of FY24. You can read more about it in our 2024 Spaceship Voyager investor letter.
Uber is in the Spaceship Universe Portfolio, the Spaceship Origin Portfolio, the Spaceship Galaxy Portfolio, and is available in our US Investing Service.
Eli Lilly
Fell -9.11% (from 1-31 July 2024, converted in Australian dollars and not annualised.)
Colonel Eli Lilly founded Eli Lilly in the USA in 1876.
It’s a pharmaceutical company that’s created and distributed life changing medicine such as insulin and prozac to international markets.
Its focus is now is on its diabetes franchise with Mounjaro and weight loss drug Zepbound.
Why did Eli Lilly stock go down?
In a word: pressure
US President Joe Biden and senator Bernie Sanders authored an opinion piece in a popular US news website calling for big pharmaceutical companies, including Novo Nordisk and Eli Lilly, to make the prices of weight loss and diabetes drugs much cheaper.
Meanwhile, research was released showing that weight loss drug competitors Wegovy and Ozempic retained only one in four patients two years later.
Eli Lilly is in the Spaceship Universe Portfolio, the Spaceship Earth Portfolio, the Spaceship Origin Portfolio, the Spaceship Galaxy Portfolio, and is available in our US Investing Service.
Advanced MicroDevices
Fell -8.87% (from 1-31 July 2024, converted in Australian dollars and not annualised.)
Advanced Micro Devices has been around since 1969.
Its High Performance Computing has helped power advances in aerodynamics, AI and cloud-computing.
Why did AMD stock go down?
In early July, AMD announced its plans to acquire an AI startup called Silo AI for about $665 million in cash. This is in addition to the $125 million it spent acquiring or investing in AI companies over the last twelve months, according to Reuters.
AI stocks had been largely taking a breather over the past month while the market waited to see the return on investment from the companies that had invested in them.
Advanced MicroDevices is in the Spaceship Universe Portfolio, the Spaceship Earth Portfolio, the Spaceship Origin Portfolio, the Spaceship Galaxy Portfolio, and is available in our US Investing Service.
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 Portfolio, Spaceship Galaxy Portfolio, and our Spaceship Earth Portfolio.
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 TOMRA Systems, Zip, Generac, Illumina, Tesla, CrowdStrike, Lululemon, Uber, Eli Lilly, and Advanced Micro Devices 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.
