NeutralPEPPepsiCoPepsiCoLULUlululemonlululemonPOOL

Yesterday on

Every time it gets late and I’m still awake, I end up looking back at some of my past investment decisions and thinking about how stupid I can be sometimes. I’ve been thinking a lot about errors of omission vs. errors of commission. $POOL is one that bothers me. I followed it for a long time. Around $150, I thought the price was attractive enough. I had done the work. I understood the business. But I decided to wait for a better price. Same thing with $PEP around $125. I didn’t expect explosive growth. I was looking at it more as a high-quality, defensive business with a roughly 5% dividend yield and a reasonable price. I still didn’t pull the trigger. And $LULU is another one. I believed the numbers I had calculated. I thought the valuation was becoming interesting. But I didn’t size the position aggressively enough when I had the opportunity to add below 95 Now some of these stocks are bouncing back. And honestly, I’m not sure what bothers me more: Losing money on a bad investment, or being right about a good investment and not having the conviction to act. I do not want to be a victim of FOMO. That’d be stupid. But at what point does “I’ll wait for a better price” become an actual investment mistake? How do you think about errors of omission? And how do you distinguish disciplined patience from simply being too afraid to pull the trigger?

NeutralPEPPepsiCoPepsiCoGISGeneral MillsGeneral MillsMCDMcDonald'sMcDonald'sSTZConstellation BrandsConstellation Brands

6d ago on

Something interesting is happening in the market today. $STZ $PEP $GIS $MCD and other consumer defensive names are seeing some pretty meaningful moves higher. I wonder how much of this is related to the midterm election results versus investors simply rotating back into defensive, cash-generative businesses. The election outcome may have removed some political uncertainty, and investors could be reassessing which sectors stand to benefit or face headwinds from the next policy environment. At the same time, lower Treasury yields and a broader change in market sentiment could be helping dividend-paying consumer staples. But I don’t think all these companies deserve to be grouped together. $MCD has a relatively clear company-specific catalyst with its latest earnings and improving profitability. $STZ has been showing some signs of improvement in beer shipments. Meanwhile, $PEP and $GIS are interesting because their underlying businesses still have to prove they can get volume growth back on track. Personally, I’m more interested in understanding whether this is the beginning of a broader rotation into businesses with predictable cash flows, or simply a short-term reaction to the election. One thing I don’t want to do is confuse a rising stock price with an improving business. Curious how everyone else sees this: Are we witnessing a rotation into consumer defensives because investors are becoming more cautious about the broader economy and growth stocks? Or is this mostly an election-driven trade that could reverse once the initial excitement fades? And more importantly, which of these businesses would you actually be comfortable owning at today’s prices, rather than simply trading the momentum? Customers are still struggling…and that can’t and won’t change overnight, right?