What happens when Stock Moe interviews TipRanks CEO Uri Gruenbaum? We get a fascinating conversation that every investor will want to listen to.
The pair discuss a wide range of topics, including where the markets could go next. They discuss healthcare stocks, cryptocurrencies, electric vehicles, ESGs, green companies, and more. Uri even tells us his three favorite stocks – definitely worth a watch!
Here are some edited excerpts from the interview.
Stock Moe: When I grew up, I didn’t have a TipRanks where you have all this information from Wall Street in the one place, or YouTubers doing their own research. A service like TipRanks is invaluable.
Uri: Thank you. While you were speaking, I was thinking about how investors today have alternatives to CNBC and Bloomberg. Thought leaders like yourself provide lots of informative content. You get hundreds of thousands, and I’m tempted to say soon millions, of viewers. That the ratings of your shows are higher than standard TV is mind-blowing.
Stock Moe: I don’t often look at the YouTube channels of the big networks, but I did see one or two and was surprised how their views compare to a lot of YouTubers.
Uri: There’s no question that the market of information has completely transitioned over the past few years. COVID has accelerated everything, such as how we consume information and the resources that investors have.
COVID-19 and the Markets
Stock Moe: You brought up the topic of COVID. What is your take on the effects of COVID on the stock market, say over the next year?
Uri: That’s an interesting question. In March 2020 when the lockdowns started kicking in, it seemed like the capital markets were about to melt. When you think about it, it was a renaissance era for the investment community. Investors realized that there are so many opportunities.
I feel that is over now. We’re not going to see many companies doing three-digit growth every month like we used to. But there probably still are a lot of opportunities, for example in the healthcare space.
Pfizer probably has the best vaccine in terms of how many people get COVID after having their second or third shot. It’s kind of funny how companies like Moderna grew so quickly while Pfizer, that has a better vaccine, hardly moved. Only in the last month or two did we start to see it move. So, there are anomalies in the market. But it’s much more difficult to find these gems now.
Stock Moe: I like what you said. I believe that the virus is not going away. I believe there will be mutations over the next five or ten years. You brought up Moderna whose price has gone through the roof, then you have Pfizer that has not followed suit, but they have a good product. I do believe that there is opportunity there.
I like that train of thought that there are bad situations and there are good situations for investors. Back in March 2020, everything was at rock-bottom, everything pointed to something you could take advantage of it. Now it’s a little tougher, I think the easy money from back then has gone. Now you’re seeing a lot of sideways trading and people are getting discouraged.
Uri: You can also see that in the investor sentiment side of things. There are fewer people exploring financial websites. We’re getting a bit less traffic, we know that other websites in our space are getting less traffic. People are less excited because it’s not the gold rush anymore.
There are many opportunities the other way, to find interesting shorts. I hardly do any shorts or buy put options but there were so many SPACS that don’t make sense. There were a lot of companies that were considered growth companies, that took off with everyone else. I think there are a lot of opportunities to find these companies.
Stock Moe: I agree. From November, some of these companies were going up 100 or 200% with no real fundamental changes. Then suddenly, you see the climax in the first week of February. Everyone’s making money, everything’s going up. That should be the first sign that you might want to lock in your profits, and/ or just diversify into some more into some value stocks, ‘cos it’s going to get nasty out there.
Market Bubble?
Uri: Everyone knows we’re in some sort of bubble, the multiples don’t make sense. The thing is, nobody wants to leave the bubble if there is room to go up.
Stock Moe: I did a video in December, predicting 15-20% for the S&P this year. I have it now at 25%, maybe more, for the full year. I only predict about 4-6% next year based on all the numbers. I think there’s going to be some volatility in there.
There’s talk about the S&P not having a 5% drop in this entire year. I think we’re going to easily have that next year. The fed is tapering off, I think you’re going to see an increase in tax rates, these things are negative catalysts. You’re not going to have the same year-over-year growth in 2022 as you had in 2021.
That being said, let’s talk about something fun that I think everybody out there loves – crypto! Everybody who watches my channel knows I’m all about Ethereum but there are some other good coins out there. Do you have crypo in your personal portfolio?
Cryptocurrencies
Uri: I used to have Bitcoin, I also have some Ethereum, but we’re talking about very marginal numbers compared to my stock portfolio.
However, nobody can ignore that crypto has become mainstream over the past two years. And there’s no question that it’s here to stay.
From a company perspective, we started launching crypto pages. We recently released a Bitcoin and Ethereum page and we plan to do more. I don’t think we’ve got an edge on other data providers yet, but we’re going to look at what alternative data can we find and make accessible to investors.
Stock Moe: For anyone watching, I highly recommend TipRanks. Before I learned about TipRanks I would go out and look for Wall Street analysts, look for their recommendations, and that’s a lot of work. When I discovered TipRanks, I was so happy that it saved me so much time. Then I find out you have insider buying – who’s buying from inside the company and all kinds of other information. So, it’s an awesome variable for those doing research to look at and I do recommend it. I do like crypto, and I think you guys would be awesome for that.
Uri: How do you make an investment decision about what coin you’re going to invest in? When it comes to companies you have fundamentals, you know the product. I guess it’s kind of like crypto, because there is a reason behind each coin. But when it comes to stocks you have the fundamentals, how do you decide which coins you want to invest in?
Stock Moe: There are over 5k coins. I think back to the days of the dot-com pre-2000 period. To me, there are parallels. At the end, you have Amazon, eBay, Google, a couple of big channels that made it big. I see the same thing for Bitcoin, Ethereum, and maybe three or four others.
I look for utility, I look at the developers, I look at who’s using it, does it solve normal issues. There’s a lot of hype out there. I see it on my channel, people spamming different coins I haven’t heard of. We don’t know if it’s good or bad, but that’s where TipRanks comes in. I think you could help people out with that.
Uri: Absolutely! I’d love to hear more about how you would approach this. If you come up with good tools that we can leverage big data for we’ll develop it and even name a tool after you!
Tesla and the EV Industry
Stock Moe: What do you think about the EV industry? I know you’re based in Israel, is it growing over there like it is in the U.S.?
URI: Absolutely! Tesla landed in Israel about a year ago and it takes almost a year to get a Tesla when you order it. It’s probably the most popular car on the streets right now. The pricing in Israel is high, the Model X is around $50,000, maybe $55,000. It’s more expensive than in the U.S. because of the taxation in Israel.
I decided to wait to buy a Tesla until all the infrastructure is in place, but everybody I know has ordered one. That gives you a good idea of the popularity and potential of these companies and their stocks.
Even if you put aside Tesla, you can see all the big companies are transitioning into electric vehicles. Everyone understands that this is the future. Elon Musk did a great job of disrupting the industry.
Is it a bubble or not? You see companies like Nikola and a few others, and it’s hard to say, they don’t have any sales, but they’re valued at tens or hundreds of billions of dollars. It doesn’t make fundamental sense.
Before our call, I went on Google Trends and I searched for the term ESG, Environmental, Social, and Governance. I saw how the chart has gone up over the past two years. There are more people than ever searching for the name ESG. The more capital that goes into the ESG space will lift the EV space.
Yet, if you compare ESG to Bitcoin on Google Trends, you see that for every person searching for the term ESG, you have a million searching for Bitcoin.
But the trend is clear, it’s going up and there’s going to be more capital in ESG companies, which is why I’m very Bullish on green energy, renewable energy, electric vehicles that reduce pollution. In general, I think it’s a great vertical to invest in.
Stock Moe: There’s a gas station near my house which installed Tesla chargers, which blew me away. Tesla here in my own rural town in Pennsylvania. For the first couple of weeks, I’d drive by and never see a Tesla, this is about a year ago and I expect to see this picking up. I do believe Tesla is going to be the dominant EV force.
Then we talk about the valuations, you mentioned some being very high priced compared to the fundamentals. I think it relates back to the dot-com industry. You saw the same thing, most won’t make it but the ones that do are going to be multiples.
Uri: I think that most of the people who are investing in Tesla at a valuation of $700B+ are not doing it because they just believe in the car. They believe in the concept of clean energy. They believe that Elon Musk is a phenomenon and can disrupt any industry that he wants, with the hope that it’s going to be under the Tesla umbrella.
Uri’s Favorite Stock Picks
Stock Moe: If you had to pick three stocks that you really like having in your portfolio, which 3 would you pick?
Uri: The biggest stock in my portfolio at the moment is Microsoft. It didn’t start as the biggest, it just keeps going up and up. It’s not a company that you hope is going to do 200% a year, but it’s a solid investment. They are dominating cloud along with Amazon. Office 365 is an amazing product. I can see how much money we spend at TipRanks on their different products and services. They can change their pricing and suddenly they’re going to make an additional $50 or $60 billion a year. It’s a good company and I think their CEO is doing a great job. It’s probably going to stay in my portfolio for the rest of my life.
Another company that isn’t so mainstream but is popular is Disney. That used to be my biggest holding, but Microsoft just passed it. I’ve been holding Disney since 2019 when they announced they were getting into consumer streaming.
Disney has the best content in the world, they have the Star Wars franchise. I’m addicted to their movies, my kids are, my parents are.
I feel that the streaming is not yet factored into their valuation. When the theme parks and the theaters open you will see a point where there is all the synergy. It’s a stock that had hardly moved for many years until they went into streaming. They went down when COVID started and they had to shut down all their parks, but now it’s changing.
I think they passed 130M subscribers. They are going to pass Netflix at some point. They haven’t even reached Israel yet; you have to use a VPN just to see their content. So, they have a lot of growth potential, which is why I’m a big believer.
One interesting growth company that I have, that I’m very proud of is a company called TalkSpace (TALK). It was founded by two Israeli entrepreneurs who moved to New York and decided to give online treatments. It replaces a therapist, and you can do it online. It took them a long time to get a lot of users, I think their net worth is around $60m so they aren’t that big yet.
Why do I believe in this company? We talked about COVID before, and I believe it is here to stay. Looking at people around me, there is a lot of stress and uncertainty, and I believe that mental health support is going to be a big issue. TalkSpace seems to be the category leader of this new space.
What’s New on TipRanks
Smart Moe: I agree and can see that space as being one that does very well. Mental health is very important, and we need more tools like that to help out around the world. I have to tell you that I love Disney as well. It’s one of my favorite stocks.
Is there anything new that you want us to share about TipRanks? Anything to look forward to, or what can we get from TipRanks?
Uri: I’ll tell you about two new features we recently released; features that we know users love, both free. Then I’ll share a bit our plans for the next quarter or so.
First, we have a tool to compare stocks. It’s interesting because it shows a lot of different factors, not just market cap and P/E. We have a lot of themes, so you can easily compare EV or space stocks. Space is another industry that we should probably have a separate discussion about.
Second, we spent a few million dollars to develop a new tool with a lot of big data that shows companies’ risks.
Our tool shows changes in risk over time. This is something that the average investor doesn’t pay attention to; if you ask a hedge fund manager, it is one of the first things they look at. It is very tedious to review these reports and when you read them, you have no idea if the information is new. We analyze and classify that. We show if a company is more exposed to political risk or technology risk or has commercial or legal issues.
Understanding the risk of a company is as important as understanding the potential upside, but as investors, we tend to ignore that. I feel that our job at TipRanks is to make data accessible.
We are planning a streaming portal on TipRanks and I’d love you to take part. We’ve invested a lot in news and content. Our news is syndicated across the world, you will see us all over CNBC, Yahoo Finance, and Nasdaq.com. Our news team is getting amazing feedback and we want to invest more in video content.
