Welcome back, everyone. Thanks for joining.
On today's episode. We have artificial intelligence
that we know is getting better and better every day.
It's being used in more and more applications.
We've seen it advance so much and just like a year or two now,
this raises a question for investors of what can we do with
this technology to better help us invest?
Not only do we want to make great investments in AI
companies, but what if artificial intelligence in and
of itself could help us guide our investments?
That's going to be one of the things we look at today.
I have well over $1,000,000 invested when I combine the
passive income portfolio and the story fund.
Now I invest in companies that I define as super high quality,
dominant companies, ones that are scalable, high margin, fast
growing. These are my favorite type of
companies that I like to buy. But what if we asked AI about my
entire portfolio overall and my investing philosophy?
What would it say about that? Well, that's what we're going to
be looking at today. We have my entire portfolio
combined $1.266 million and we're going to be going through
what AI has to say about it. We also have another example
portfolio here, all in on Tesla. We'll be looking at AI's review
of this approach and all in on Palantir and reviewing the
commentary and analysis that artificial intelligence gives.
Now, of course, we also have some other news to get to.
Trump is back on the tariff train.
He is announcing 25% tariffs on imports from Japan and South
Korea. I have some thoughts on this and
how it will or will not impact the markets.
And of course, we have more news, more drama with Elon Musk.
He is running out of Rd. in China, according to the Wall
Street Journal. That's what they say here.
And on top of that, Elon Musk just recently announced his own
political party, the American Party.
We'll be looking over this news and seeing how it's impacting
different companies like Tesla and Uber.
And then finally, I wanted to throw in a company I have yet to
talk about on this show up until now.
And it's one that I think, in fact, I'll argue in this episode
that it's become more innovative than Apple.
That company is Shark Ninja. Shark Ninja is a fast growing
company that's innovating rapidly.
It's very impressive what they're doing.
And I believe they're beating many top tier tech companies at
their own game. So we'll be looking at this
underdog Shark Ninja and seeing if there's an investing
opportunity here. Now we start things off today by
looking at the theme of artificial intelligence.
We know that as investors, we look at artificial intelligence
through investment opportunities.
What do we want to invest in? Which companies are creating the
AI? Which ones are creating the
hardware to run the AI? Which ones have the network
effects in the user base to implement AI?
Which ones can replace humans with AI enabled robots, so on
and so forth. And that's the major focus most
of the time, which we spend a lot of time on this channel
discussing. Many of the top companies in My
Portfolio are ones that I believe will benefit directly
from AI, like Google or Amazon. But not only is AI providing us
a set of great investment opportunities, different
companies we can buy equity in, but it also may help us directly
manage our portfolio, manage our investing philosophy.
It may help give us ideas and feedback, like a bit of a
financial advisor, an investment broker, someone that you can
call up and get a little bit of help when you're discussing an
investment decision. AI is getting much better at
understanding context and philosophies, different
investing ideas and approaches. I understood this when I was
looking at different LLMS and asking them different investment
questions. I do this regularly and these
AIS are getting much better. For example, the two LLMS I use
the most is Chachi BT and Gemini.
I bounce back between these two regularly testing both of them
out and one of the conversations I just recently had with with
ChatGPT was very impressive of its understanding of my
investment philosophy. Let's go ahead and just take a
look here. The discussion was whether or
not I should sell Costco because it has a 50 PE ratio.
We know that Costco in My Portfolio is a very large
position. We look at it right here,
$85,000 position. So this is a very meaningful
position. It's massively in the green.
The majority of the position is gains because I started buying
the thing back in early 2018. So Costco's up around 3:00 to
4:00 X since when I was buying it to begin with.
So that the kegger of Costco has been incredible, but a lot of
Costco's gains have come from multiple expansion, not just
earnings growth. They have earnings growth, they
have special dividends, and they've had multiple expansion
from the 20s and 30s PE up to A50.
So I asked Chachi PT based on Joseph's strategy, would it be
good to sell Costco stock now that it's trading at A50 PE
ratio? Now here's the answer it gives,
based on Joseph Carlson's investment philosophy, which
prioritizes business quality, predictability, and long term
compounding over short term valuation concerns.
Selling Costco solely because it trades at A50 PE ratio would be
inconsistent with his approach. Here's why Why Joseph would
likely hold Costco despite the 50 PE.
Exceptional business quality. Costco's membership model, scale
advantage, low turnover cost, and defensible Moat aligned
squarely with Joseph's focus on high quality, low drama
businesses. Predictable growth.
It's long history of steady inflation beating growth and
market share expansion in retail market makes it one of the most
predictable compounders in the market.
Valuation discipline and not obsession.
Joseph acknowledges valuation, but he's shown in his own
ownership of names like S&B Global and MasterCard that he's
willing to pay a premium for businesses with enduring
economics and consistent reinvestment opportunity.
Now this sounds pretty accurate so far going on.
It highlights a few caveats here.
Maybe exceptions, it says. That said, when might he trim if
another holding offer superior risk adjusted upside?
For instance, if Costco's Ford returns compressed a low single
digits due to multiple expansion alone, and they're similarly
high quality compounders trading at far more attractive
valuations. Reallocation might make sense if
growth decelerates while valuation stays elevated.
If comp growth starts to materially slow and the PE stays
above 40 to 50, Joseph might reassess whether the business
still meets his hurdle rate for Ford returns.
Bottom line, no, Costco should not be sold just because it
trades at A50 PE unless a clearly superior opportunity
exists. Joseph's philosophy favors
holding elite, predictable businesses for decades, not
trying to time their valuation peaks.
Now. I look at this and I think it
sounds pretty accurate. This is, I believe, an accurate
assessment of my behavior and philosophy.
It doesn't stray too much from my own thoughts, and in a way it
is just my thoughts being relayed back to me.
So naturally I agree. I, in fact, I think this is good
advice. I agree with myself here.
Now, overall, when I look at this, it shows the power of LLMS
to be able to look through a lot of information and give you a
concise, valuable input based on your own investing philosophy or
what you're trying to accomplish.
And I think that can be very helpful.
You may not agree with everything, but the AI at least
gives you some food for thought, some things to think about.
And when you look at this not only just with one company, but
your overall portfolio construction, the entire
composition of it, I think the advice is even more interesting.
When we built this feature in the Qualtrim, I was able to look
at lots of different portfolios and investing philosophies and
see both the qualities and risks of them.
When we look at this month's update, and this is updated as
of this morning, this is how My Portfolio stands as of today.
We can look at the top holdings. We have Netflix right at the top
here. From Netflix we go down the
list. Some of these I've gained 39,043
thousand, 34,000. We can look at the percentages.
Some of these are older holdings or ones that have gained a lot
more than others. The only one that I'm in the red
right now is Salesforce. This is my worst investment as
of right now, but I'm only in the red by around $1600 on this
one, so we haven't had too much of a loss on it.
The companies that I've been buying the most recently include
Equifax, Google, and Amazon. These are three companies that
I'm incredibly bullish on. I think the future is very
bright for him, and I think they're all undervalued.
Now with the overall combined holdings and the weightings
being taken into account, we can see what the AI thinks of my
overall portfolio. Now.
This AI portfolio analysis was updated this morning with all
the latest data. And the way that this works is
we have the quality section here, which builds you up and
makes you feel so good about your portfolio When you run the
AI analysis and you'll get the qualities, you'll be thinking,
wow, I, I have great, I have a great portfolio.
It, it's, there's so much opportunity here.
You know, it gives you all the qualities that highlights all
the strengths. Then you get to the risks.
And this is where it really highlights the stuff that you
might not be as eager to hear about the stuff that's more of a
problem for your portfolio. So that's what it does here.
It, it builds you up at first, then it kind of tears you down
to give you a full, full analysis.
You get both sides of it in the qualities.
And this is a part where it's going to build us up.
It says this portfolio is comprised predominantly of
dominant blue chip companies with entrenched global
franchises, platform advantages, resilient reoccurring revenue
streams. Companies such as S&P Global,
Moody's and Equifax possess wide economic moats derive from data,
regulatory position and essential services offerings
that underpin financial infrastructure globally with
high margins and substantial pricing power.
So we have a lot of good qualities here.
One of them that I do focus on intentionally is resilient
recurring revenue streams. Most of the companies in My
Portfolio are subscription or highly recurring revenue.
They also I believe have substantial pricing power.
Each company has proven that MasterCard, they say.
The AI says exemplifies a business model built on toll
collector economics characterized by asset light
operations and robust transaction based revenues
unconstrained by secular payment growth.
Intuit in Salesforce reinforced the portfolio's technology
exposure with sticky subscription based business
models that serve critical back office enterprise needs and
enjoy high customer retention. Microsoft and Alphabet further
enhanced the portfolio's quality with their dominant software
ecosystems, reoccurring cloud and productivity suites,
revenues and best in class scalability in the respective
segments. It goes on saying that the
consumer resilience and global scalability are reinforced
through Costco's durable business model, which delivers
stable cash flows regardless of macro cycles.
Amazon's omnipresence which most leading logistics and cloud
infrastructure along with formidable first party and
marketplace platform economics and ASMLASML represents a unique
technological gatekeeper in semiconductor manufacturing,
underpinning industry innovation with virtual monopoly status and
EUV lithography systems integral to chip advancement.
Booking holdings in Netflix also sector defining.
They're also sector defining with strong network effects and
operational leverage inherent in their digital platform models.
Collectively, the portfolio's holdings are marked by pricing
power, high free cash flow generation, strong management
teams and significant long term growth runways driven by
entrenched positions in essential, scalable and capital
efficient businesses. So this last sentence here where
it says that these companies have pricing power, high free
cash flow generation, they have strong management teams and
significant long term growth. That's all stuff that I repeat
routinely on this show and the AII believe gets this correctly.
Now this is the qualities of the portfolio, which this portfolio
is at no lack of incredible quality.
It is a very, very high quality portfolio.
So it makes sense that it's giving this glowing review
trying to characterize all the different qualities in just two
paragraphs here. But then we get on to the risks.
And this is something that I like looking at monthly because
it reminds me about the risks of my companies.
I think it's easy when you invest in really high quality
companies to just kind of brush aside or sweep under the rug
some of the risks that you're actually facing.
It says that the portfolio is notably concentrated among large
cap, high multiple growth companies, leaving it exposed to
valuation compression risks, particularly if interest rates
rise or macroeconomic conditions lead to lower risk tolerance
among investors. Technology and digital platform
businesses represent a significant allocation, which,
while resilient in many respects, brings heightened
susceptibility to regulation, emerging competition and rapid
pace of technological changes. Companies like Alphabet,
Microsoft, Amazon and Netflix all face increasing scrutiny
from global regulators concerning data privacy,
antitrust and digital market power, any of which could impact
their long term growth and profitability.
Additionally, the cluster of financial service providers, SME
Global, Moody's and Equifax means that the portfolio could
be vulnerable if there are meaningful shifts in the credit
markets, regulatory frameworks or structural changes that erode
their Moat such as decentralized financial alternatives.
So defy all these companies doing stablecoin and that type
of thing. It's highlighting as a risk
rescue Global Moody's and Equifax, which I do think is is
a notable risk. It also highlighted in this
first paragraph that the very first one, the very first thing
it came up with is that these are high multiple growth
companies leaving them exposed to valuation compression.
And I think right now that is probably the most significant
risk of My Portfolio. Now it highlights a couple other
things here. It says a further risk is the
underwriting of more defensive and non discretionary segments.
Despite Costco's presence, the portfolio has limited exposure
to traditional healthcare, utilities and industrials
outside EFX materials or energy. So I really have no, I have no
investment in healthcare, utilities, industrials, material
or energy. Now it highlights that is a risk
because it it means a portfolio's less diversified,
but I believe this is a risk worth taking.
In my opinion. You can try to diversify into
every sector, but I believe that some sectors are just worse to
be in. I think that overall, even
though these defensive sectors, or at least they're considered
defensive, they're more stable. You have sectors like utilities,
industrials, these Big Blue chip companies that are in the Dow.
They're a lot slower growing. And if you want to outperform
the market, if you really want to have alpha, I think it's very
difficult to do that while investing in all of these slower
growing, more defensive companies.
But it does note that this makes the the portfolio less defensive
in some situations. Now it also says this sector
concentration leaves the portfolio more cyclical than it
may appear, particularly given Booking Holdings, Texas
Roadhouse and Amazon sensitivity to consumer spending trends.
While most holdings demonstrate impressive scalability and
recurring revenues, several require continued innovation and
CapEx intensity to retain their competitive positions,
especially ASML, Amazon and Netflix, raising execution and
investment risk. Finally, relying on a
concentrated handful of global leaders brings idiosyncratic,
headline and operational risk. Idiosyncratic is an investment
term that means that it's very specific.
It's specific to these companies.
When you diversify to an ETF, you don't have those very
specific finite risks that exists with these companies,
with these leaderships. They say where these operational
risks or headline risks, where reputational, legal or
technological missteps could materially impact portfolio
performance. Now, I think overall that's a
good look at My Portfolio. It's a nice reminder of both the
qualities and the weaknesses that I can look at every month
and kind of assess what I'm doing, especially as I'm making
changes to the portfolio and the allocation.
Now let's go ahead and take a look at some other portfolios
with more aggressive investing strategies.
Let's go ahead and just look at an all in Palantir one.
I haven't done this before. I'm not sure what it's going to
do here, but let's run the analysis and see what happens.
I click analyze portfolio. We can wait a few moments here
for it to load in and there we have it.
It's loaded in. We have the new portfolio
analysis and again this is 100% Palantir.
So the only holding this is what the AI has to say.
The portfolio is solely invested in Palantir Technologies, the
company recognized for it's strong foothold in the data
analytics and enterprise software sector.
Palantir Score competency lies in it's highly entrenched data
integration platforms which are tailored for both governments
and commercial clients who rely on secure mission critical
insight generation. The company benefits from deep
relationships with its clients, often with multi year high value
contracts, creating a durable Moat that is hard to replicate,
especially given the sensitive nature and complexity of its
deployments. Its government contracts, in
particular, are associated with long procurement cycles and high
switching costs, further solidifying Palantir's
competitive position and enabling relative predictable
reoccurring revenue. Another strength of Palantir is
to focus on scalability and expansion across various
industries owing to its modular, customizable software platforms.
The company demonstrates A scalable business model with
high gross margins characterized by enterprise software firms.
Its offering is deeply integrated into client workflows
leading to high client retention, strong pricing power
management led by visionary founder continuously seeking to
innovate and expand the platform's capability, extending
its runway for growth both domestically and
internationally. These qualities position
Palantir is a potentially resilient business capable of
thriving through different economic cycles driven by demand
for analytics and data-driven decision making.
That's pretty good. In fact, that's really good.
It's not. It's almost convincing me at
this point to invest in Palantir.
I look at this and it's a bit different than the the
investment analysis you're getting from Dan Ives that
Palantir. You know, if Dan eyes was here
writing these AI write ups, if it was him instead, it would say
it's time to get out the popcorn.
Palantir is the messy of AI, you know, a bit different of
analysis here, but this is really good.
I think it's a thorough look. It shows all the benefits of
Palantir, at least many of them, the strengths of the company,
which I've said for a long time. I think Palantir is a great
company, I really like it. But let's go ahead and take a
look at the risks. What does it have to say here
having 100% of your portfolio in Palantir says?
However, the portfolio single holding concentration in
Palantir exposes it to considerable company specific
risk. Any operational setbacks,
strategic missteps or negative development specific to
Palantir, such as major contract losses, regulatory scrutiny
regarding data security, or failure to sustain innovation
ahead of competitors, could result in significant capital
impairment. With no diversification across
sector or business model, the entire portfolio's performance
is tied intrinsically to Palantir's fortunes.
The government's segments of its business, while a source of
stability, can also be subject to political and budgetary
uncertainties that are outside the company's control.
Market perception of Palantir's controversial dealings and
evolving regulatory landscape involving big data and privacy
could also pose a risk of its valuation of long term business
prospects, it highlights. Again, without any other asset
class, the portfolio lacks a cushion against these
idiosyncratic sector wide shocks.
Investing solely in Palantir seems incredibly risky.
Let's go out and see if it mirrors those same thoughts
about Tesla. My thoughts are it's going to
highlight the very same issue. Just having all of your
portfolio in a single stock is just way too much concentrated
risk. So let's go ahead and take a
look at it here. Now, I'm not going to read the
whole thing, but it goes over a lot of the technology of Tesla.
Some of the things that we've heard before says nonetheless
the portfolio's concentration or concentrated exposure to a
single stock. Tesla represents A substantial
risk as it's performance is closely tied to the fortunes and
volatility of one company. Within the consumer cyclical
sector. Tesla operates in an incredibly
competitive market facing both legacy automotive players,
scaling EVs and new entrants in China and beyond.
Execution risk remains high. Furthermore, Tesla's premium
valuation hinges on the company's ability to deliver
relentless growth and achieve ambitious targets.
Any perceived slowdown or missteps could result in
substantial price corrections. Now I wonder if it's going to I,
I wonder if it's going to mention that Elon Musk getting
involved in politics is a potential risk.
Maybe that's not baked into the models quite yet.
It says. Tesla's business is also exposed
to broader changes in consumer discretionary spending,
especially given its concentration in high ticket
durable goods. Macroeconomic slowdowns.
Rising interest rates can dampen vehicle sales.
The company's aggressive expansion comes with capital
requirements that could pressure margins and lead to dilution if
not carefully managed. Additionally, the highly visible
and unconventional management style primarily driven by Elon
Musk introduces key person risk and the potential for headline
driven volatility. It's exactly what we're seeing
today. The lack of diversification in
this portfolio magnifies the impact of any negative
development specific to Tesla, reducing the resilience of the
overall investment of the sector and company specific shocks.
So there you have it. Investing in any single company,
especially one like Tesla or Palanter, I think you're taking
on significant risk in doing so. And overall, I think the AI is
mostly correct and I think it's good feedback.
Now, when we look at headline risk, there's one piece of news
that happened just today. Trump announced a 25% tariff on
imports from Japan and South Korea starting August 1st.
He gave these letters on Truth Social with this announcement.
And basically the letters say that they're not working with us
fast enough, they're not getting enough done, we're going to
tariff them. And then he says if they
announce reciprocal tariffs, we are going to match and increase
the tariff on them by whatever number they choose.
So if they say they're going to tariff us by 2025%, we'll raise
the tariffs another 25% on them or whatever it may be.
Now we look at how the market's reacting.
Right now, we're down 1.2 percent, 1.4 down a percent or
two after having a great start to the month.
This is big headline news, right?
Tariffs rattle the market, but we're really only down a percent
and a half. And I believe my prediction is,
even if these tariffs get more and more extreme, if Trump re
announces a bunch of them or we get Peter Navarro on TV talking
about the tariffs again, I think we're very unlikely to have the
same type of dip with the same magnitude that we had back in
April. For the simple reason that it's
more scary the first time when you're buying the dip in any
situation, the first time that something happens, it's far more
shocking, far more uncertain, far more scary to the market.
In April 2nd, that's where Trump came out for the first time and
really relayed how extreme these tariffs and reciprocal tariffs
were. They are far above people's
expectations. That shocked the market and
dropped at 10%. That's what I was saying is a
buying opportunity. When investors are unsure, when
they're scared, that's when you buy the second time.
Something happens each time Trump announces tariffs.
For now on, investors will have in the back of their minds that
he can change his mind quickly, that Trump doesn't like having
the market go down, that investors that bought the dip
last time were rewarded. So they're more likely to hold
on to their shares. And in fact, they're more likely
to buy any smaller dip when it happens.
And overall, it's just less scary the second time something
happens. So it's far more unlikely that
the market will drop to the same extent it did the first time.
You can look at any other example.
You can look at COVID that dropped the market 45%.
But if we had another pandemic, if we had another disease, it's
very unlikely in this lifetime that it would drop the market to
the same extent because investors would have a
reasonable expectation of how things would play out.
We'd be able to adapt and know without as much fear.
That's the way the market works. So I believe we're very unlikely
to see the April lows again based on tariffs, even if
President Trump ramps him up again like he did the first
time. Now we also have Elon Musk
making news again. This time, Tesla shares are down
7% because Elon Musk says that he's launching a political
party. Now, he's not just saying that
he has. He's actually launched a new
political party, a new one that he calls the American Party.
The goal of it is to be the centrist party, to try to take
away key votes from swing states so that he can kind of control
which party wins and which one loses.
Now, obviously, this gets deeply into politics, and there's a lot
of opinions on this. Some people say that Elon Musk
should stay out of this, that he shouldn't be involved in
politics. He's not good at it.
It's not what he does. And while you may agree with
those arguments, I'm very reluctant to have the stay in
your lane attitude. I think Elon Musk should be able
to do whatever he wants. He's a a free person.
If Elon Musk wants to share his political views, he's free to do
so. If he is not satisfied with
either political party, he's free to create another one.
But I also believe there's a view from the Tesla investor
perspective that Elon Musk, while he's free to stay out of
his lane and and move to any lane he wants, he's free to get
into politics. He also has a role and a
responsibility. He's still the CEO of Tesla and
he seems to be pursuing politics at the direct expense of Tesla.
Now for the CE OS of companies that I invest in, I've been very
consistent on this. I am OK with them getting
involved in politics if it benefits the shareholder.
If my CEO is going out and becoming political, but it's
benefiting me the shareholder. The politics play well into the
company and the role at the benefit of the company, then I
believe the CEO in that case is doing its job.
It's representing the shareholder base and it's
advocating for its shareholders. But in the case of Tesla, you
can see investors reactions to what he's doing.
Tesla stock is continually getting pummeled by Elon Musk
getting further and further involved in politics.
He seems to have set his Tesla CEO position secondary to his
political ambitions. Seems like it's not even as big
as focus. If you look at what occupies
Elon Musk's mind, it's not Tesla's success, it's politics.
Everyday more frequently he's tweeting about politics, about
political subjects. Most of the time it's not even
related to Tesla at all. It's very difficult to interpret
that this is some long term gambit to make Tesla in a better
situation. If anything, it's actively
damaging the brand and distracting the CEO.
We've seen that Elon Musk has alienated a lot of people on the
left by supporting Donald Trump. Then he's alienated a lot of
people supporting Donald Trump by having a big fallout with
him. And during that time period, he
managed to swing around Europe and alienate a lot of people
there, which were some of his biggest customers.
Elon Musk's involvement in politics has overall been a
complete unmitigated disaster for Tesla.
The company would be better off if he focused on Tesla.
And I believe this puts Tesla investors in a very difficult
situation. They have ACEO, that's a
legendary CEO that has the ability to lead this company in
the right direction, but he's continually focused on other
ambitions, and that is playing into the company.
The big winner of this, of course the entire time is Uber.
Uber investors are very satisfied with what Elon Musk is
doing. Uber investors have ACEO that's
strictly focused on leading the company, integrating it with
EVs, making sure that they become the de facto robotaxi
network. While Tesla stock is down nearly
8%, Uber stock is up nearly 2.2%.
We look at Tesla on the full year basis, we can see that the
stock year to date is down 23%. We look at Uber during the same
time period. Uber is currently now up 52%
year to date. I don't know how long Tesla
investors will continue to tolerate Elon Musk not caring
about the company, focusing on other things and in some ways
directly sabotaging their portfolios and gains.
But I think it's just a matter of time.
We're already seeing discontent with people like Dan Ives, Gene
Munster. We've seen some funds already
pull out money that they are planning on investing in Tesla.
And I think we're going to see more of that fallout in the
future. Now moving on, I'm going to
highlight a stock that I believe is a story of innovation, one
that's becoming more and more dominant every single year.
And that's the type of companies that I like.
Looking at innovation is a part of my investment criteria.
Although it's not necessary for a company to innovate to have
good returns, you can have ones that just kind of do the same
thing over and over again. Companies that do innovate and
invent and create new things typically end up creating a lot
of value for shareholders over time.
These are companies like Amazon or Google creating leading AI
models or always innovating like Amazon.
So when I look at these type of companies, sometimes you get
focused on the bigger, larger market cap companies, the Max 7,
you know, all these wonderful companies at the very top, but
they're not always the most innovative in the market.
You can take for example, Apple. Apple has struggled with
innovation. The updates in the iPhone are
becoming less and less noticeable over time.
The new product launches like the Apple Vision Pro have been
mostly a flop. They haven't gained a large
market share and Apple seems to be stagnating a bit.
While that's happening, there are much smaller companies, in
fact, one that I'll highlight right now that I believe is
incredibly innovative and it's one that you may not suspect.
Shark Ninja, the combination of both Shark company, the one that
makes the the vacuums. You know, they make a lot of
different vacuums as well as different products.
And then Ninja, which makes tons of products from healthcare,
beauty, lots of foodie products, different food gadgets.
This company combined to form what I believe today is one of
the most innovative companies, and I say that not ironically.
It is incredible what this company's actually doing.
This is a video given to investors highlighting what this
company's actually doing and how important they're becoming.
Shark Ninja's a story of innovation and we've been at
this for over 20 years. Our business started with.
So they have, they have these things which are like, it's like
a blender built into a, a bottle.
So you, you blend it and then you just drink it straight from
where you blended it. Like you don't even take the
thing out. So it's, it's just a completely
portable blender. I don't have one of those, but
I, I, I see them, I see them being sold.
They seem to be quite popular this.
Started with cordless sweepers, steam mops, irons and today we
go. The the air fryers, those are
huge. I mean, they're they're probably
one of the most popular cooking items ever made and I think for
good reason. They are incredible.
They do a bit different than a convection oven.
If you haven't tried out an air fryer, I think you're missing
out big time. But Ninja in particular with the
shark Ninja brand has capitalized on this.
Every time I go into Costco, I see a Ninja branded air fryer
every single time. And the only reason that Costco
keeps them on the shelves is because they keep selling They
stop selling. They would no longer they would
no longer be ordering them back at Costco.
Go to. Market under 2 multibillion
dollar brands that we created called Shark, which is a market
leader in cleaning home environment and beauty and our.
Yeah, they also have a lot of beauty items.
They're they're gaining market share in beauty, which is an
area that I would not think Shark would be a part of.
It seems like it would be difficult to go from vacuums to
hair products, but it seems like they're making that leap.
And our Ninja brand, which is a market leader in kitchen
appliances, outdoor cooking appliances, other outdoor
products. The Shark brand is in 14
different categories. The Ninja.
Brand is in 20 different categories.
It's coffee makers, it's knives, it's cookware, it's ovens,
grills, it's outdoor grills, it's air purifiers, it's hair
care, it's vacuum cleaners, corded, cordless and robotic
vacuum cleaners. We have one of these too.
We got, we got the little Shark matrix vacuum.
I don't know where it is one of these things, you know, it just
goes around and vacuums your carpet.
If you have the, if you pick up stuff off the floor, it'll go
through and vacuum it. They work quite well.
Shark has one that they use by the way, they use LIDAR, so that
expensive technology, they use lighter on it.
Many of these use a combination of sensors.
They use LIDAR. Some of them are vision only,
some are Lidar vision. Other ones even have sensors to
identify what type of floor you're on because they'll switch
from a mop to a vacuum. Like, if it knows it's on a
carpet, it'll vacuum. So these are getting quite
advanced. And I believe that this is where
Dyson has missed out. Dyson fell behind in the robot
vacuum game. That's what every millennial in
Gen. Z wants.
They don't want to vacuum their own floors.
They want a robot to do it. And Shark Ninja is on top of
this. Shark has all sorts of ones.
They've really gained market share in this category.
They're on the forefront of all the trends, all of these home
items. And I must ask, just just
pausing here, why doesn't that have an Apple logo on it?
Seriously, why do we not have an advanced integrated Apple robot
vacuum that you can control with your iPhone that's part of the
ecosystem that that's sleek and well designed?
You know, they couldn't figure out the the cars.
Maybe that's just a little too intense.
Maybe there's too much liability.
People get killed in cars. But Apple could have certainly
made a stab at it to do a vacuum if they sold 100 million of
those. How much does that equate to?
These things can sell for four hundred, $500.
And I see it as a massive trend. I really believe five years from
now, nobody's going to be vacuuming their floors.
The sensors are so good. Everyone's going to do it by
vacuum. But Shark came in here.
These other companies came in here and adapted and they
capitalize on this market before the likes of Apple, the ones
that should be doing this. Vacuum cleaners.
We sell our products today in 32 countries, 70 million products a
year. We have hundreds of millions of
consumers around the world. Others can identify problems,
but we can solve the problems that others can't.
Just in the last three years, we've entered into 19 new
categories. There's real innovation.
Before this year, we never made it home.
These things are now they're just everywhere.
The they have two different ones.
They have one where they make you make slushies with them like
this one. Another one you can make ice
cream with it. Those are two more shark
products that they or Ninja products that they invented and
they're getting on the shelves of Costco.
They're getting on the shelves of Walmart.
They're everywhere in people's households now.
And these things are not cheap. They are premium items.
This company is inventing all new categories, creating new
home products all the time, and I'm seeing more and more of this
in my household. I don't have one of these but I
keep seeing more and more of it. We never made in home slushies,
we never made in home espresso, and we're only getting started.
We work for one person, which is the consumer.
There's no shortcut to success. It's earned one product at a
time, 1 five star review at a time.
When I look at this company, I'm impressed by how highly
innovative it is. A lot of this stuff just doesn't
exist and they're coming up with it, making it viable.
Products entering into new categories.
And this is what I expect to see from top tier companies.
When we look at another product here, This is one that my wife
tells me she wants. She wants this thing, and I
didn't even know that this existed.
Now I've seen this type of things at different parks like
Six Flags or sporting events where you have a fan tied to
cold water and it mists you with cold air.
So it really cools you down during the hot summer time.
Now Shark makes this type of product.
They have a fan here you can see it's, it's misting these people
with ice water. You fill up this thing with ice
water, you hook it up and then it, it siphons the ice water up.
It pumps it up and then shoots it through the fan.
So you can have this outdoors. It says it can cool up to 70
feet across and you have yourself like a sports cool Mr.
for outdoor activities and that mist fans a very successful
product. It has 4.5 stars on Amazon and
they sold 10,000 of them in the past month.
That's just on Amazon. Not to mention they're huge
retail outlets. So I'm very impressed by this
company's ability to continually innovate.
Not to mention the past five year performance is 150% and
that's starting at a bad time. If you bought the dip right
after that, it's more like 200 at 300%, but even at 150%, this
beats out Google's performance. Shark Ninja has outperformed
Google over the past five years and it trades at a 24 PE ratio.
Now though I'm very impressed by this company.
What I believe it lacks right now is at least a deep Moat, an
operating system to tie itself together.
I think if they integrate their products more into a smart app,
if they make a more unified, they have some way to tie
consumers to their name brand loyalty, they'll be less reliant
on just purely innovative progress in the future.
But I do believe this is a stock worth of watching, and I believe
many investors could do well in it.
That's for this episode. See you in the next one.