The Canadian Investor - Episode 100! Lululemon, Dollarama, Gamestop and Cloud Computing

Episode Date: September 16, 2021

In this second episode of the week, we’re doing a roundup of earnings and news. We’re talking about recent earnings of Lululemon, Restoration Hardware, Roots, Dave and Busters, Dollarama, Affirm, GameStop, Zscaler. We also discuss some recent news from Canada Goose. Tickers of stocks discussed: LULU, RH, ROOT.TO, PLAY, DOL.TO, AFRM, GME, GOOS.TO, ZS https://thecanadianinvestorpodcast.com/ Canadian Investor Podcast Twitter: @cdn_investing Simon’s twitter: @Fiat_Iceberg Braden’s twitter: @BradoCapital See omnystudio.com/listener for privacy information.

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Simon, congratulations. We did it, man. 100th episode today i didn't think we could do it but here we are and cheers to 100 more my man yeah very exciting getting to 100 i think we're actually a couple episodes more than that but we're not counting the five minute episodes with like quick updates that we did uh but yeah it's pretty amazing right within uh two years we we did. But yeah, it's pretty amazing, right? Within two years, we did 100. So yeah, congrats. Yeah, I think if you were to look, there's more than 100 postings, but they're not actual episodes. Whereas this is the actual 100th episode. So

yay, we made it and cheers to 100 more. All right, before we get into an earnings roundup today, we got lots of fun companies to talk about, different sectors so you can get a feel of what's going on. But how about the Blue Jays? And if you're not a sports fan, that's okay. But this is Canada's team when it comes to baseball and they are playing on rookie mode. And I know you're a baseball fan as

well so go jays go man yeah yeah it's probably my uh my favorite sport to watch on tv like on par with hockey i would say but they've been just so fun to watch i mean you can make a case that sometimes baseball is boring but uh for that team team, they're exciting and they're turning heads even in the U.S., so that takes a lot. Yeah, and what they put up like 22 runs the other day, like that's not boring. I mean, even if you think baseball is a little boring, watch some of these games. It's not. They're putting up so many runs. I'm going to the game on Sunday.

I can't wait. All right, let's get right into it, Simon, with your first company on today's earnings show. Yeah, first company I want to talk about for the earnings release is Lululemon, ticker LULU, L-U-L-U. On August 26, they also announced that they were raising the minimum wage. They would pay their employees for the majority of their stores the rates would be starting at $15 an hour to $17 an hour depending on the stores and the roles in terms of their earnings I mean I'm not sure what else to say outside of like they were amazing they just blew everything out of the water their net revenue increased 61% to $1.5 billion. Direct-to-consumer revenues increased 8% to $597 million. Direct-to-consumer was 41.2% of total revenue.

That's a bit of a decrease compared to last year, but let's just keep in mind that last year a lot of people were just ordering online on their website. The company operated stores increased their revenue by 152% to 695 million. Again we're talking about what was happening last year here. Gross profits increased 72% to 842 million and gross margins increased 390 basis point when a lot of retailers and yeah a lot of retailers actually saw those decrease because of increased costs so we're seeing that lululemon has a lot of pricing power net income more than doubled at 208 million free cash flow was 355 million versus negative free cash flow last year they increased their guidance between 619 billion

to 6.19 billion to 6.26 billion for the full year. That's an increase of five point compared to their previous guidance of 5.82 billion to 5.9 billion. So that's really impressive because they're seeing really their sales going up very nicely. That's why they increased it for the rest of the year. And obviously when you're getting closer to the end of the year, typically management will have a better idea of what the full year will look like. So very interesting that they were increasing this. Women's sales were up 49% to $968 million, which is still their biggest segment. Men's sale, which was very impressive, up 91% to $363 million. And they're saying that they're actually beating what they were projecting for the increases in man sale and other categories

did quite well as well those other categories include the recent acquisition of mirror that was up 81 to 118 million all in all amazing quarter from lululemon they just keep firing on all cylinders i'm not quite sure what other adjective i can give them right here they are absolutely crushing it i have three thoughts here one that the men's sales segment up 91 is bonkers the men's segment is crushing it and the fact that it's now over one-fifth of the revenue for the business means that they are really transitioning and focusing on that. And the results are speaking for themselves. You and I both love the clothes. So it makes sense that this category is killing it.

The second one of my hot take is 41.2% of total net revenue, which is direct to consumer on their e-commerce channel platform, which is down from 61% is actually amazing. And the reason for that is now that the stores are open, 41% of their total net revenues are still going from direct to consumer is incredible. going from direct to consumer is incredible. That is higher margin product that they're able to move and this speaks to the brand power and how much the customers like it. Direct to consumer with clothes is difficult because of the friction of having to make sure that the clothes actually fit versus trying it on. If you know your size at Lululemon and you know you order some product in the size that you know fits you, you know you're going to like it and you know how it's going to fit every time. It's consistent. So that speaks to that 41% of total net revs going through that direct consumer channel. That is huge.

And then the third thing here is it is difficult to invest in clothing companies because it's so tricky to gauge whether something's going to be in style or out of style in the future. to gauge whether something's going to be in style or out of style in the future. But look at this from Lululemon. They keep getting it done and it's starting to enter that high quality category where people are not concerned about that. Like a Nike that just seems to just have forever brand power. Lulu could be starting to prove that. One more thing before we move on, there was a viral tweet about some guy who's been holding Lululemon for over a decade now or whatever. And it must have been on the US listing the whole time because the Canadian listing got delisted, unfortunately. But it is the

classic 100 bagger story. He's posting how he's hold it for this long. It's his first 100 bagger. bagger story. He's posting how he's hold it for this long. It's his first hundred bagger. And congrats to this guy. Cause it's actually hard to come across a hundred bagger. People sell it before they even get to that hundred bagger. And it is the perfect hundred bag story. It is not always up and to the left or up into the right. My apologies. It is that classic period of it did nothing for years. It had huge drawdowns. He saw crazy volatility. He saw the value of his stock go down like 80% sometimes, but he held through it because he focused on the business fundamentals and not the stock price. So if you want to have some of these hundred baggers, you want to have some of these companies that do create life-changing wealth,

you got to hold on to them and understand that volatility along the way is 100% normal. Yeah. Yeah. It's just part of the ride. It's part of the ride, baby. All right, moving on. Restoration Hardware, the furniture company. ride, baby. All right, moving on. Restoration Hardware, the furniture company. Revenues were up 39% from a year ago. And I like that in all their statements on the press release, they also have a separate line that says what it was against two years ago. Because Q2 is a very tricky comparable, given that Q2, we're in the thick of lockdowns. That's just tricky comparable to make. So revenues are up 40% from two years ago. Very similar figure. Impressive. Net income doubled. Now, the stock is up 750% from last March, which is absolutely insane. It's a very interesting stock here. Even at $14

billion, it's still fairly small in the grand scheme of things. Maybe not for a furniture company, but they are carving themselves out as a leader in luxury home furnishings. And look, people need furniture and they want that new modern look, RH or Restoration Hardware is that brand. Gross margins were at an impressive 49%, which was up over the year. And they're guiding for a 33% revenue growth and a whopping 70% on return on invested capital for the year. mean look this is the company that has that modern look people love it people like the brand and i am personally bullish on the luxury category overall whether it's furniture or jewelry the luxury category right now i believe is uh prime for the future luxury category right now i believe is uh prime for the future yeah yeah nothing nothing to add there so we'll move on to our next name roots uh ticker root.to i'm sure everyone who's from

canada listening knows this brand pretty well we're talking about the clothing brand obviously pretty small business for context 130 million $130 million in market cap. Sales were up 1.8% to $38.9 million. Direct-to-consumer sales up 6.6% to $30.4 million, which was kind of impressive to have such a big part of their sales to be direct-to-consumer. Gross margins of 58.1%. That's up 340 basis point from Q2 2020, which is pretty impressive right there. Net loss of $1.1 million, which translates to $0.03 per share. Free cash flow negative for the quarter compared to free cash flow positive last year. They have some new collaborations with Tim

Morton's, Jason Logan, plus the Toronto Ink Company. They had 68 stores close when they entered Q2 2021, and now they are all open except one. So that's a good sign for them. Personally, it is a company that I associate a lot with Canada, just kind of the idea I have in mind. But I'm not sure if it's a company I would necessarily invest in. But it's not trading super expensive, but it's also not a company that I can see growing very quickly. Lululemon here where I'm not sure they can keep up with new fashion trends like a Lululemon, a Nike, or insert other clothing company that does well over time. So yeah, kind of in a nutshell, what Root did in the last quarter. As do-it-yourself investors, we want to keep our fees low. That's why Simone and I have been using Questrade as our online broker for so many years

now. Questrade is Canada's number one rated online broker by MoneySense. And with them, you can buy all North American ETFs, not just a few select ones, all commission free so that you can choose the ETFs that you want. And they charge no annual RRSP or TFSA account fees. They have an award-winning customer service team with real people that are ready to help if you have questions along the way. As a customer myself, I've been impressed with Questrade's customer service.

Whenever I call or email, every support rep is very knowledgeable and they get exactly what I need done quickly. Switch for free today and keep more of your money. Visit questrade.com for details. That is questrade.com. Here on the show, we talk about companies with strong two-sided networks make for the best products. I'm going to spend this coming February and March in an Airbnb in South Florida for a combination of work and vacation and realized, hey, my place could be a great Airbnb while I'm away.

Since it's just going to be sitting empty, it could make some extra income. But there are still so many people who don't even think about hosting on Airbnb or think it's a lot of work to get started. But now it is easier than ever with Airbnb's new co-host network. You can hire a local quality co-host to take care of your home and guests. It's a win-win since you make some extra money hosting on Airbnb, but can still focus on enjoying your time away. Find a co-host at airbnb.ca forward slash host. That is airbnb.ca forward slash host. For the same reason I said investing in fashion brands is difficult is the same bear case for Roots. And I mean, I believe from my perspective, and perhaps this is just anecdotal evidence, the brand has lost a lot of power over time. And it is just that

cute Canadian clothing company. And that's difficult for me to actually invest in as an investor myself, because these Canadian companies, I need them to demonstrate scale. I need them to demonstrate scale for them to be an investable idea. Because in the grand scheme of things, Canada is a small market. Do I think that Roots is going to be a bigger and better company in 10 years. I cannot say that with any confidence. And that's basically checklist number one in my investment thesis. Moving on, Dave and Busters, ticker play. That's an awesome ticker. So I like to pull up businesses like this that represent,

you know, quote unquote, air quotes, reopening that buzzword, especially for Q2 reports, because we were in the thick of lockdowns and Zoom happy hours. I do not miss those Zoom happy hours. If you invite me to a Zoom happy hour, I will say no, thank you. Dave and Buster's meets this criteria, right? It is that going out activity. For those who aren't familiar with Dave and Buster's, they own 143 locations that combines a restaurant, a bar, arcade games, kind of all together. And now they say their venue offers the opportunity to eat, drink, play, and watch. I've been a timer too, Simon. It's kind of fun. Like I can't really say with confidence that it's fun, but it's kind of fun. Revenues totaled $377 million compared

to the previous year of only $50 million. However, not useful. They were hardly open. I want to see that year before, which was a 344 million in 2019. So this does represent a 9.6% increase from 2019, which is the comparable that I'm looking for. The 2020 number means basically nothing to me. So it is interesting when you're looking at these reports, you'll see the headline, Dave and Buster's increases revenue 600%. Slow down. That's really not a good way to look at it. It is up 9.6% from 2019, which is impressive. The CEO of the management team says that, you know, people are looking to get back out there and do stuff. And this is one of those do stuff type businesses.

For me, it's just kind of fun. Yeah, yeah. I've been there a few times myself, too. And I would probably agree with that. You know, if you drink enough, you'll have a good time. That's probably what. Yeah, that's a good point. Right.

And that's where they make all their margin right is is on the drink so yeah it's an interesting company to follow because i know we're not really in lockdowns anymore but even if we don't enter a lockdown and cases go way way up will people be comfortable going to a place like that inside i think that that's a big wild card for them. So it'll be interesting just to keep an eye on it and with COVID cases and the Delta variant, how things go going forward. But now let's move on to a completely different business, Dollarama. Everyone knows about Dollarama, the Canadian dollar store, market cap of $17 billion, sales increase 1.6 percent to 1 billion 29 million comparable store sales were actually kind of a mixed bag because if people remember during this

time period in q2 part of it there was a ban on non-essential products in ontario so their sales went down about five percent for that period of time. And then the rest of the quarter, they were up about 5% when the ban was stopped. Gross margins decreased 50 basis points. So that's not great to see. Not surprising because they probably don't have that much pricing power, which is the type of merchandise that they sell. EBITDA increased 5.7% to $293 million. Net earnings up 2.7% to $146 million. They opened 13 net new stores in the quarter. Their store count actually increased year over year 5.1% to% to 1381. They repurchased 163 million worth of shares for the quarter. They continued to have solid free cash flow, which is what you would expect from Dollarama.

They also announced a quarterly dividend of 5 cents and change per share. All in all, you're looking here at Dollarama probably slight increase in same store sales or organic growth but for the most part you're looking at a company that will be increasing its revenues mostly as they open new stores so it'll be just interesting to keep an eye on they tend to share that new store count quite a bit in their earnings release. So if you're interested in them, keep an eye on that. Yeah, it's a grow by new store story. And that comparable same store sales, that's the number that everyone looked at. It looks like it was down 5% here.

But with Dollarama, it suffers from the same kind of problems we were just talking about, which is, I like the company. I like the story. I like the category of dollar stores. We've seen this model work so effectively. We've seen them actually have surprising pricing power, but they suffer from scale outside of Canada. And that's a really structural disadvantage that I can't really get behind. It has all the makings of a high quality compounder. They buy back lots of stock. They generate lots of cash. They raise the dividend year over year. They have higher return on invested capital when they deploy a new store and it gets better over time as the store reaches maturation. But overall, I mean, you have that structural scale problem and a lot of Canadian companies do have that problem. And that's why I've been just ho-hum with Dollarama

when we talked about it on the podcast, which is simply put, I like the stock, but I don't love the stock. Moving on, Affirm, ticker A-F-R-M. This buy now, pay later company IPO'd in January. It is basically flat since they IPO'd, but it is actually up 100% in the past month. since they IPO'd, but it is actually up 100% in the past month. So if you are doing math at home, yes, the stock lost 50% of its value after it IPO'd, within a few months after it IPO'd. On a quick side note, Shopify does own 8% of Affirm, which is an interesting thing to take note of. Affirm is the business of buy now and pay later. When you check out on certain e-commerce platform, you will see pay with Affirm, which is basically moving your payments to installments. Their Q4 came out on September 9th, so they have that weird fiscal schedule,

with merchandise volume up 106% and revenues up 71% year over year. They did lose over $100 million in the quarter, so they're not profitable. But they also announced a huge partnership with Amazon. This is a big thing. They partnered with Shopify already. So they have the distribution from the big boys and they're ready to go, which is already impressive execution. They do have some notable concentration risk. They even separate their growth numbers with Peloton and without Peloton. Peloton is the stationary bike company we've talked about a few times. They do have expensive bikes. So it makes sense that the buy now, pay later segment works for them. This is a big customer peloton, so it's worth mentioning some customer concentration risk. Now, Affirm has some explosive growth. It loses lots of money though, and it moves around a lot.

It's crazy volatile. It was down like 11% yesterday. So if you own these high growth, It was down like 11% yesterday. So if you own these high growth, unprofitable companies, stick out the volatility. You got to focus on business results, not share price results. Now there is obviously competition with names like Afterpay, which is being bought by Square for 29 billion all stock. The big thing I see with Afterpay is that they have a partnership with Stripe and Affirm does not. Stripe, in my opinion, is the most important fintech payments company that exists right now. Even if Square and PayPal are doing more volume on their networks, I think that in the next 10 years and even right now, Stripe will be the most important fintech platform. So it's important to take note of that. As do-it-yourself investors, we want to keep

our fees low. That's why Simone and I have been using Questrade as our online broker for so many years now. Questrade is Canada's number one rated online broker by MoneySense. And with them, you can buy all North American ETFs, not just a few select ones, all commission free so that you can choose the ETFs that you want. And they charge no annual RRSP or TFSA account fees. They have an award winning customer service team with real people that are ready to help if you have questions along the way. As a customer myself, I've been impressed with Questrade's customer service. Whenever I call or email, every support rep is very knowledgeable and they get exactly what I need done quickly. Switch for free today and keep more of your money.

Visit questrade.com for details. That is questrade.com. Here on the show, we talk about companies with strong two-sided networks make for the best products. I'm going to spend this coming February and March in an Airbnb in South Florida for a combination of work and vacation and realized, hey, my place could be a great Airbnb while I'm away. Since it's just going to be sitting empty, it could make some extra income. But there are still so many people who don't even think about hosting on Airbnb or think it's a lot of work to get started. But now it is easier than ever with Airbnb's new co-host network. You can hire a local quality co-host to take care of your home and guests. It's a win-win since you make some extra money hosting on Airbnb, but can still

focus on enjoying your time away. Find a co-host at airbnb.ca forward slash host. That is airbnb.ca forward slash host. Yeah. Yeah. I mean, it's interesting. There seems to be a lot of new entrants to that space. And I know some of the big banks are also getting into that market of the buy now, pay later later kind of reminds me of back in the day the department stores where you could just sign up on the spot for a credit card and you get like 10 15 off so it's just a new way of doing things and like i've said it before it's just a buy now worry later basically for the consumer buy now worry later is probably a good way to put it and uh you know it's it's worth noting right because the business model itself

is kind of predatory there's no way around it yeah yeah exactly now let's move on to a stock that makes no sense gamestop um so gainstock came out with their earnings obviously there's always some drama surrounding GameStop they still have a market cap of 14.5 billion approximately that's when I checked a few days ago so knowing how volatile their stock is it's probably give or take a few billion dollars the conference conference call was quite entertaining. So the whole call was seven minutes. But once you remove the operator kind of introducing the the CEO, the call lasted six minutes. Management did not allow any questions from analysts. I'm assuming it's still because of, you know, the meme stock thing and that the share price is so disconnected with the reality of the

business that management doesn't even want to get into that. Further results, sales were up 25% to $1.18 billion versus last year. Net loss of $61.6 million. Gross profit margins was almost the same as last year which was approximately 27 they only have 47 million dollar in debt on the balance sheet which is something management talked about and it's actually a french government loan related to the pandemic response they launch a new 530 000 square foot fulfillment center in reno ne Reno Nevada they did not provide any guidance they were free cash flow negative for the quarter so yeah that's that's what's going on with GameStop personally I think management could approach this a bit better even if they allow questions maybe be straightforward and just say they will not answer any questions related to

may be be straightforward and just say they will not answer any questions related to gamestop and wall street bets something like that but not a fan of them not having any questions whatsoever for for shareholders in general the management team's in a tricky situation right where they're just trying to execute on a transformation of this business. And the good old GME going to the moon news headline is all that people really care about. So, I mean, it's got to be a frustrating situation for GameStop. You did mention to me, go listen to the call. It's only seven minutes. You won't need much time. I was like, okay, you know what?

I actually listened to it and I put it on. I made breakfast and I was like just getting the pan heated up and the call was over and I wasn't paying attention and it was already over. I'm like, ah, whatever. Simon will go through it today but yeah i mean the call being seven minutes is hilarious i gotta say that yeah yeah so now we'll move on to uh some news not earnings release um some of you may have heard canada goose was fined by the chinese government uh they fined canada goose 450,000 yuan, which is approximately $88,000 Canadian.

Last week, the Chinese government claimed that Canada Goose was misleading consumers in China and accused them not using the same material that they were saying their jackets had. So basically, I had false advertising. That's what the reason was behind the fine. I wanted to talk about that because we have talked about this before when it comes to the Chinese government. That they have rules that they want to enforce and they will not be shy of enforcing those rules. However, they see fit. So whether this is true, what they're alleging that Canada Goose is doing or not it doesn't matter they're enforcing it and it's unilateral and I wanted to mention this

because Canada Goose is a Canadian company it's listed in Canada and the US but they still do a lot of business in China and I know a lot of people will tweet at us when we say we own Tencent, for example, I own the ETF K-Web as well. And they'll say, oh, why even bother investing in China? And, you know, that's fine. It's not for everyone. But realize that it's very possible that businesses that you own that are listed in the US or Canada could be impacted by this as well because they have a significant part of their business in China. So it's not only Chinese listed companies that can be affected by this. It's any business doing business in China. Yeah, well put. It's something to consider, right? Even North American companies. Let's look at Apple, for instance, the biggest

company by market cap on the planet has such tight ties with China, not only from their supply chain and manufacturing capacity, but it's also the largest market that they sell smartphones into. into. So it doesn't just, the risk, the China wildcard doesn't just apply to the Chinese listings. And I did a spaces on Twitter the other day with Barry Schwartz, who's going to be coming on the podcast soon, get hyped for that. He's always on BNM Bloomberg and stuff like that. So some of you guys might be familiar with him. And we were just talking about it. And I said, hey, you know what? This risk is out there. It exists. We know it exists. And I completely understand if investors say, hey, I live in North America. I live in Canada. I can't understand what's going on in China, so I just stay away. I don't have any edge there. And I think that is a completely legit take,

completely legit take. My take recently has been that I'm talking about Tencent specifically. It's the only one I know well, has such a stranglehold on the way its citizens use the internet, which is extremely monopolistic and it's incredible business. That's why they're targeting it. That's why they're trying to bring down some of these tech names so I can understand that. But right now it is priced at somewhere that I am looking to make some money. And that's just the end of the, that's just the whole story right there is if you can buy great businesses at unreasonably low prices, that's what I'm going to try to do. And I think I could be wrong. I think that that's

where this one sits. Yeah. Yeah. Well put. And the last thing I'm going to add is if you don't want to invest in China, that's fine. But make sure you're aware of what's in your portfolio because they could be doing a lot of business in China. 100%. Where do you think that iPhone you're holding was made? All right. Last one of the day. Zscaler. Okay. Zscaler, ticker ZS. It is a software as a service platform specializing in cloud security. They have over 5,000 enterprise companies and they claim that they have 500 of the largest 2000 companies in the world on their security platform. Now, as a somewhat rookie to cloud computing and cybersecurity, let me explain what Zscaler does in the easiest way that I can, which I understand and you probably will be able to understand as well. So let me break this down into some terms that hopefully everyone is familiar with.

So most businesses today, and especially pre-COVID, they have their employees connecting to their company network via various ways, whether it be employees at the head office, employees on the road, the road warriors, whether they have a VPN that they can connect to at home through the mobile device that their company gave them, or perhaps through apps on their own personal laptop and own personal phones. This bring your own device thing is a common trend that we've seen. So connecting to their cloud platform, as well as another list, whether it's they're on google drive aws azure products the list goes on there are tons of routes that employees can connect to

networks via the internet this creates a abundance of problems for cyber security for this company zscaler sits in the middle of this and they say, hey, look, our platform, you can connect every device and every way that the employees engage with the internet to your cloud provider on a secure Zscaler cloud. So it's not competing with cloud providers, rather existing as a middleman between the company and the internet the Zscaler cloud and have this zero trust exchange, which is going to be more secure, less threats to your cybersecurity at the enterprise. They reported Q4 revenues up 57%. They're not profitable. Gross margins were around 80%, which you like to see from these software as a service companies. They have consistently grown revenues by close to 50% or more, and it is still led by the founder Jay

Chaudhry. I mean, Simon, shocker, this thing trades at the classic nosebleed valuations over 50 times sales, cloud cybersecurity type multiples. The question is, is it cheap if they sustain this growth i think that that's the question that a lot of us investors are struggling with right now and wrestling with is are these companies worth those multiples i just can't say for certain right now yeah yeah i i don't know and i don't know the space well enough to know that they're the top company in cybersecurity or cloud security. Personally, I mean, just from an outsider, I failed to see if they have really a moat going forward. Like, I'm not sure if a company, a competitor just comes in, has better overall technology. Like I'm not sure if a company, a competitor just comes in, has better overall technology. Like what prevents any of their 500 businesses that are of the 2,000 largest companies from changing from going to another company.

So that's probably the questions I'd be asking here. Like I said, like you said as well, like I just don't know the space well enough. If I were to invest in this space, I probably would rely on people that know this space well enough if i were to invest in this space i probably would rely on people that know this space better than i do on the one hand and on the other hand i would probably just do a basket approach and take the four or five top names according to industry experts that really understand this space well equally weighted and just have the basket approach. Because obviously, it's a industry that will grow over time. I just don't know how to identify the winners. Yeah, and that's a very fair point. And getting to know the companies you want to invest in is

obviously incredibly important. But it's okay to say, I don't know this, I need to do more work. And if you want to do more work on it, and you want to dig into the cybersecurity cloud companies, I guess you have to just go in with it that even if you have no idea what you're doing, I feel like it could be learned and it could be understood in a way that is at least makes some of this stuff investable. And I think that that's important, right? Is saying, oh, it's too hard. I don't want to get to it. Is a fair thing, if a fair approach, you know, the too hard pile, that's what investors call it. Like, I don't get it. I'm just going to move on. That's fair. But at the same time,

if you do put in a little work and something that might be interesting and has this kind of huge secular trend like the cloud and like cyber security then you might generate some huge returns by digging in a pile that no one else wants to look from my perspective crowd strike is the clear leader at the moment again trades at crazy expensive prices but grows like mad and has these insane margins it's really hard to switch off the platform and same with zscaler as well so that switching cost is appetizing and i think that's that's why people are interested in owning this stuff but time will tell simon 100 episodes we did it man congrats we did it and thank you for to everyone who's listening we wouldn't have done it without your support and hopefully we'll get

another 200 or 300 whatever it is we'll just keep going to a thousand and beyond it's a logarithmic scale so we're not gonna talk about it until we hit 1,000 now. And then it's 10,000. Big round numbers. There you go. Thanks so much for listening, guys. If you have not checked out Stratosphere, some of these companies we're talking about, you can look them up. You can go on the news and find these exact things I'm talking about.

They're in bullet points, nicely organized. For every single North American stock listed today. It's always up to date. You can look up their financials, their ratios, buy, sell ratings, the chart if you're into that as well. That is getstockmarket.com or the company name stratosphereinvesting.com. Thank you so much for listening. We'll see you in a few days. Take it easy. The Canadian investor is not to be taken as investment advice. you so much for listening. We'll see you in a few days. Take it easy.