Stop wasting your precious time

Prepared by Dr. Christopher F Davis, founder and team leader Quad 7 Capital

Hi everyone. We wanted to take this opportunity to offer you, the followers of our public work, an opportunity to get an insight into our highest conviction ideas. So far in 2024, our win rate is tracking near 85% on these ideas. That means 8.5 of every 10 trades have successfully hit the target exit for every 1.5 that triggers a stop loss. We have continued to publish an average of one high-conviction investment idea each week. Below we show you member feedback, and we also offer you a free investment idea from our service. 99% of these ideas NEVER see the light of day. We have a standing policy. Whenever we receive a service review, we offer new members a flash sale, a chance to join at a ridiculously discounted rate. You can see what they had to say below! The next 3 members who decide to join our full service we will take 31% off the price, saving you nearly $200!!!

For $200 off and a money-back guarantee? YES SIGN ME UP (CLICK HERE)

No thanks but tell me more

We are on our chat interface during market hours providing market insight to the day's trading and key events. We even provide daily key analyst call summaries to understand action in key stocks. We have a standing policy. Whenever we receive a service review, we offer new members a flash sale, a chance to join at a ridiculously discounted rate, so take advantage. And, there is a money-back guarantee if you decide to cancel. Below are our two most recent reviews, along with some of our recent closed trades, and redacted open trades.

From user CCovey:

Only Regret...Wish I found BB (Bad beat) sooner!

Bad Beat Investing has been one of the BEST investment services I have ever subscribed to--and trust me I have wasted a lot of money over the years trying to find the "right" fit for my needs, interests, and support that I expect. I have learned so much already and it's only been 5 months since I started the service. And most importantly, I have been able to make steady gains on stocks they recommend weekly. What I appreciate about Bad Beat is their level of knowledge, integrity, professionalism, and most of all patience! I have never experienced a paid service that is willing to answer questions I have and other investors in the group have in an incredibly timely manner (same day! and within minutes!) and with deep-level understanding of the stock, market environment, political news, cutting edge information, and of course the financial picture of the individual company. If you are ready to expand your portfolio's horizons, I recommend you stop wasting your precious time and money on other services and join Bad Beat! I sleep well at night knowing that I can continue to grow my money no matter what the market is doing, what political climate we will be in, or what the interest rate is, because I trust that Bad Beat will find exactly what I need to invest my hard-earned money in and turn it into profits. I am so grateful to the Bad Beat Team! Thank you for ALL you do for us.

 

And then Sam Reid last month left this feedback:

If you want to get serious about investing

Before BB I was getting involved with a lot of risky calls. I was making a lot, but also seeing huge losses. BB not only saves you time with investment ideas which they come up with constantly, but they provide a tremendous education value into investing itself. This subscription is worth the cost several times over.

 

So is it right for you? Well we cater to income seeking investors by teaching and embracing selling covered calls, as well as selling puts to either collect premium or define entry. We have a special options only sub room.

 

We have a once a month "speculation and high risk" rapid return idea in another room.

 

 

There is also a room dedicated to short ideas (used sparingly) and daily key analyst calls

 

 

I write a weekly game plan every weekend for what to watch in the coming week and my expert thoughts on is happening on a macro scale.

 

And, every investment comes with clear common stock entry and exit points. We keep a very simple tracking table, no complicated spreadsheet. A snippet of that is below, showing some recent wins and redacted open trades, many of which are still in their buy ranges with the recent market correction.

 

This is the direct link to the summary table, of course only members can access it fully, but this is where it is housed. Within the table we provide links to the column to read the idea, or denote if the trade was an alert sent in our chat

BAD BEAT Investing Idea Tracking And Summary Table | Seeking Alpha Investing Groups

 

Now, we left open the closed trades so you could see the recent wins. Several open was are close to the exit. We left off (GCT) because we are providing that idea below for free as a thank you for reading this far.

But consider joining up, if you really are unhappy you get a prorated refund as part of our money-back guarantee!

What the hell, let's give it a shot---> Get started

No thank you

Well here is a sample idea of our trades, this one is a long-term idea we posted and got a full position on which is up about 20% compared to our basis

 

we are taking a look at GigaCloud (GCT). I have looked at this before and felt it was a speculative buy with upside. This stock is skyrocketing in the last few months, with investor optimism at all-time highs for this growth company. I think the stock makes for a good long-term buy. Consider buying some on Monday morning, and then waiting for a likely pullback of 15%-25% to add more. Buckle up. This will be VERY volatile. Take a look at this beautiful chart:

Data by YCharts

 

The play

Target entry 1: $40 (40% of position)

Target entry 2: $34-$36 (60% of position)

And if we get a gift, I would back the truck up at $25 (double the position)

For options, this is RIPE for put selling. You can sell $35 puts for April 19th 2024 for $2.50, add on if it falls more, then look to $30 puts (this was the option trade suggested at the time)

This play assumes the stock does not surge Monday, or fall. Guys, you should really expect some volatile action in this name. But I really think this stock can double again from here this year.

Now here is something to consider. The stock had debuted 2022, and took flight, hitting nearly $22 as an intraday high in its debut. It quickly fell to single digits and moved mostly sideways for a year. The stock enjoyed a speculative bounce in the late summer of 2023, only to falter. Then, it started catching fire in mid-December 2023. The question is whether this run can continue. The stock has run hard with the market rally of 2024. We could easily see a reversal, and one that hits the stock for a correction on the order of 30% in a week. It is tough to say what will trigger it, but often stocks that make runs like this often give a significant portion back. Investors should understand this reality. With that said, we see not catalyst to reverse sentiment. We see the stock moving higher long-term, as the growth has been impressive, and management is executing well. So in the short-term, expect some chop, but we do think this run continues long-term, with some healthy corrective action in between.

GigaCloud Technologies Operations and Ratings

For our followers who may not be familiar with the company, GigaCloud is an online B2B marketplace that facilitates the international trade and transport of bulky goods, including furniture, appliances, fitness equipment, and gardening equipment. In addition to the marketplace, GigaCloud also manufactures its own furniture and provides fulfillment services. We see shares a buy. It also enjoys positive ratings from our colleagues at Seeking Alpha, Street Analysts, and also has some solid Quant ratings:

Seeking Alpha GCT ratings

 

So what is so exciting about this operation? This is a high growth story, and even with the share ramping up significantly, it still is not wildly overvalued. The valuation is certainly stretched versus just a week ago, but the growth in our opinion justifies this expansion in valuation. One of the catalysts for more growth has been a recent overhaul of the business model to simplofy operations. The new business model streamlines the supply chain by bringing fulfillment in-house, managing the process from factories directly to customers. This should reduce complexity, costs, errors, and delays, potentially boosting GigaCloud's efficiency and profit margins. However, the transition is ongoing, and recent acquisitions aim to bridge any shortfalls. The long-term impact remains to be seen, so while it appears to be a winning proposition, it needs to monitored for success. All that said, a simplified operation suggests financial improvements are likely to continue.

This was evidenced by the just-reported earnings. We mentioned this was a strong growth stock. Need some evidence? How about the fact that in the quarter total revenues were $244.7 million surging 94.8% from $125.6 million in Q4 2022. Not only did sales ramp up, but there was notable margin improvement that lead to better gross profit. Gross profit was $69.8 million in ballooning 161.4% from $26.7 million in Q4 2022. Gross margin increased to 28.5%, a 730 basis point improvement from 21.2% in Q4 2022. Outstanding improvement. Adjusted EBITDA was $43.8 million jumping 188.2% from $15.2 million in Q4 2022. And, this is not a company that is not turning a profit either, unlike so many tech companies. Net income was $35.6 million in the also surging 184.8% from $12.5 million a year ago. This translated to EPS of $0.87. We expect this stock can continue rising, as this growth in our opinion justifies the expansion in the valuation metrics we have seen. And even with this massive leg higher in the stock, the valuation remains reasonable. Check out the valuation quants:

Seeking Alpha GCT valuation

The overall ratings have slipped, to coming in around 'average' value. But folks, you need to balance this with the extreme growth. Check out the growth quants:

Seeking Alpha GCT growth quant

The numbers really speak for themselves.

But what beyond the business model transformation is driving such growth? Well the company has now successfully integrated Noble House and Wondersign, and that has aided in GigaCloud taking a huge step forward in its global expansion. With this integration the company is now operating in diverse geographies, and has a much wider product portfolio with premium products and expanded its business network. That comes on top of the core business' organic growth. The company is spending working capital to bolster research and development to boost its cloud infrastructure. This company is really making strides in innovating, and enhancing the supply chain. It is extremely impressive.

But we are not without risk. First, surging stocks usually give a chunk back. While it is not 100% a guarantee, history suggests there will be corrective moves. That is more of a short-term risk for traders to be aware of. For investors, we do expect ongoing growth. The second risk, is that this is a Chinese company. While they are operating in new and diverse geographies, Chinese stocks have been tough. However, GigaCloud's customers are outside of China. A meaningful improvement in China and that market could really send a further boost to the stock. A third risk to be aware of is the exposure to shipping and freight costs. A lot of the margin expansion has stemmed from a correction/reduction in ocean shipping rates. We saw some interesting trading patterns with the Red Sea and Houthi attacks. But longer-term a significant rise in oil prices, and of course shipping fuel, is a risk that is largely to be ongoing. Other disruptions to shipping routes are also a risk to be cognizant of. Finally, as we move forward, it is likely unreasonable to expect that the massive growth on a percentage basis year-to-year can continue. This does not mean that the stock is going to crater, but investors need to be aware that explosive growth is likely to moderate.

As we look ahead to 2024, we are expecting another year of growth on tap. Management guided total revenues to be between $230 million and $240 million in the first quarter of 2024. This comes even with a warehouse fire in Japan. To be clear, this is a near doubling of revenue expected year over year. Cash flows have been ramping up, and the company continues its push forward in expansion efforts. Finally, there are repurchases which are further boosting shareholder value. Based on the present growth patterns, and assuming 2024 comes with a 33% increase in revenues, which may be conservative, and margins that remain in the high 20% range, EPS could hit $2.50 this year.

 

That implies a stock at just 17X FWD. Folks, this is still pretty cheap. (NOTE it is now 15X)

 

So join today while spots remain at this heavy discount. Try us you'll like us!

 

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BAD BEAT Investing and Quad 7 Capital offers research and writes opinion columns. By using our service you understand and acknowledge that there is a very high degree of risk involved in trading securities and, in particular, in trading options, including the entire loss of principal. Use of the service, our research columns, the chat service, and any other tools and the information contained herein is not intended to be a source of advice with respect to the material presented, and the information and/or documents contained in this website do not constitute investment advice. All users of the site are encouraged to consult with a personal financial advisor. No personal investment advice is being made, nor will be given.

 

 

Analyst's Disclosure: I/we have a beneficial long position in the shares of GCT either through stock ownership, options, or other derivatives.