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Nate Sterling
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I have been a successful investor for decades with a thorough understanding of equities, options, technical and fundamental analysis of markets and individual companies. I have a proprietary market model that I use that incorporates thousands of inputs including incorporating many other market... More
  • ANGI, TSLA, NFLX Overvalued 0 comments
    Oct 22, 2013 1:06 PM | about stocks: ANGI

    I believe that ANGI, TSLA and NFLX are overvalued. It wouldn't be a bad idea to buy some put options against these high flyers that are fundamentally worth a fraction of their current market cap. ANGI is of particular timeliness as will be reporting disappointing earnings tomorrow. The consensus number is they will report a loss per share of $.19, the whisper number has them losing $.21 per share. ANGI has severe competition problems from the likes of YELP and HomeAdvisor which offer freely accessible consumer reviews. Requiring consumers to pay subscription fees to access online reviews is a losing business model so YELP and others will continue eating ANGI's lunch. Also about 95% of ANGI's reviews are positive straight A reviews as they screen negative reviews. Also ANGI doesn't allow anonymous reviews, which screens out many negative reviews from people who don't want retaliation. See YELP allows anonymous reviews. ANGI has negative price momentum as it has fallen from over $28/share earlier this year to below $16/share. ANGI has consistently lost money each quarter of its existence. ANGI's forward P/E is above 50 even assuming the company's very positive earnings assumptions going forward. ANGI has negative ROA (-36%), negative ROI (-252%), negative operative margin (-18%), and negative profit margin (-19%). ANGI has negative book value per share. I believe the fair value of ANGI shares is at most $5 to $10/share.

    Disclosure: I am short ANGI.

    Themes: short ideas Stocks: ANGI
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