“Teeka, you really got this one wrong and lost subscribers a lot of money…”
That’s what I was thinking. But of course I didn’t say that to Teeka during our weekly Monday morning conference call in July. Turns out that I was the one who was wrong.
Before I continue, let me introduce myself. My name is Lance Goldberg. I’m Teeka’s research assistant at Mega Trends Investing and Jump Point Trader.
I joined the Palm Beach research crew back in April 2014. I’ve learned a lot about investing since meeting Teeka then… more than I have in my entire life. He is my mentor. In fact, we basically speak with one voice now… so much so that my coworkers jokingly refer to me as “Teeka’s mini-me.”
They aren’t wrong. I catch myself thinking, “Teeka would’ve said that” more often than not.
This time was an exception, though…
See, over a six-month period, one of Teeka’s stock picks had dropped 34% from our January entry price. As the market marched higher, this stock fell lower. And trust me, our subscribers’ concerns didn’t fall on deaf ears. We received numerous emails asking whether we should sell.
I started to have doubts as well. The company’s earnings reports weren’t suspect. In fact, it’d beaten Wall Street’s estimates for both revenue and earnings each of the past four quarters.
What made me question Teeka’s analysis wasn’t the company’s balance sheet or income statement, but the wild stock price swings combined with the overall downward trend of the stock. The graph below shows the stock’s plunge from March 2014 to July 2014.
The Stock Suffers a Brutal Decline…
As an analyst, watching daily price fluctuations was something Teeka taught me not to do… Daily price movements are irrelevant as long as there is no systemic problem with the company, he always says.
Still, I doubted his advice.
The company I questioned is TASER International Inc. (NASDAQ: TASR). TASER is the leading producer of “conducted electrical weapons” (CEWs) for military, law enforcement, and corrections use. TASER controls 94% of its market.
You’ve probably heard of its trademark Taser electric stun gun. But the reason Teeka believes this company will become a “ten bagger”—meaning a 1,000% return—for us is due to its wearable camera for police forces, AXON, and its Internet “cloud-based” repository for all those cameras’ data, called Evidence.com.
But as I mentioned earlier, TASER had dropped 34% from our initial buy price of $16. That’s when I started to worry. Despite the drop, Teeka still urged subscribers to go long TASER in our July 2014 Monthly Minutes: “So long as there’s been no fundamental shift in business strategy, so long as there’s been no fundamental change in its balance sheet, I’m going to recommend just riding this volatility out.”
Doubt continued to creep in, though. During that July conference call with Teeka, I remember thinking that TASER was the anchor weighing down our portfolio.
But since then, the company has skyrocketed 104% from its July low of $10.50. As of this writing, TASR is at $21.48, and we’re currently sitting on a 34% gain since our January entry price.
TASR Soars After Bottoming in July
After seeing those results, I confessed my doubts to Teeka.
He wasn’t upset. He just reminded me that it’s easy to revert to “amateur” stock analysis and then cracked, “You’re not mini-me… yet.”
Since that humbling experience, I rarely watch the stock market each day. Instead, I monitor closely when each company releases its quarterly results and re-evaluate from there.
I hope you appreciate my “confession” and learn to tune out the daily price movement of stocks as well.
Reeves’ note: At Mega Trends Investing (MTI), Teeka Tiwari guides his subscribers to buy great businesses like TASER that sit atop the most powerful trends affecting the globe. It’s led the basic MTI portfolio to outperform the S&P 500 by 1.4% to date.
On Thursday, December 18th at 8 p.m. EST, Teeka will host the first-ever Mega Trends Investing Wealth Summit. It’s a LIVE event where Teeka will announce his favorite ways to play the three biggest mega trends he sees shaping the markets in 2015. Attendees will also be able to engage Teeka via a real-time Q&A session. To participate with Teeka in the summit, click here.