Snapchat - 3 months prior and 3 months into the future

In the last three months, Snapchat released disappointing earnings in their second quarter as a public company. The stock cratered to 11. Surprising, it rallied to $15 without significant financial news. NBC News signed a deal to broadcast on the app but their $500 million investment has been known since March 2017. 29 million viewers watched the NBC channel on Snap (1). CNN, ESPN, and E! News are other networks on the app. The big question is whether Snap can charge NBC access although it is an investor. Also, Snapchat moved away from advertising revenue sharing to a flat licensing fee up front (2). This may limit the number of content partners. Meanwhile, Facebook has clear advertising revenue stated for video content.
Revenue in Europe increased from 13 to 22 million but operating expenses increased from 196 to 229 million (3).
Snapchat maps and links in Snaps were also recently introduced. Post a video to "Our story" and you can see it gets a lot of views.

In the next three months, Snapchat is expected to announce earnings on November 08, 2017 with an estimated loss of $0.14 per share. The biggest questions are whether earnings will increase with more user engagement and more licensing deals.

For the

1. http://variety.com/2017/digital/news/nbc-news-snapchat-show-29-million-viewers-1202532550/

2. https://www.portada-online.com/2016/10/20/snapchat-moves-from-ad-revenue-sharing-to-licensing-fees/

3. https://investor.snap.com/~/media/Files/S/Snap-IR/reports-and-presentations/q2-17-earnings-slides.pdf

Snapchat released a map feature from the photo screen

Pinch out from to see the location of nearby friends. Your location will be displayed as long as you have Snapchat open. There is an option to opt out of location sharing when you open the map feature. The map also shows public snaps around your location.
Another update was the ability to make stories with an option to add friends and limit to a certain location.

Snap Inc covered put trade

Sold the April 28, 2017 20 put for 0.80 and bought it for $0.30 about a week later. Significant risk with the underlying stock. Snap Inc develops the Snap Chat App. It's projected to have $1 billion dollars in revenue this year. However, it is expected to report losses this quarter. Also, their product is built on top of the cloud services of of other companies. They will have to pay Google $2 billion dollars over the next five years and Amazon $1 billion over four years. So this year, they will generate $1 billion in revenue, then pay $450 million in cloud services before basic business expenses such as personnel. Put premiums are high.

Berkshire Class B Covered Call Trade

Sold BRK/B April 7 2016 puts at $1 then bought them back at 0.20 from 3/27 to 4/04. 80% return in a few days.

Berkshire is a conglomerate of multiple companies that has outperformed the Standard and Poor's 500 over the past 40 years. It's driven mostly by it's insurance companies.

Warren Buffet's annual letter to Berskshire Hathaway stock owners is a good read this year and every year.

The other option is to trade SPY options.

US Budget and Debt

NASA receives $18 billion per year.
The Defense Department receives $540 billion.
https://www.cbo.gov/publication/52450

Federal debt held by the public is at 77% of GDP, the highest since after World War II.
https://www.cbo.gov/publication/52480

The US federal deficit for 2016 was $587 billion.
https://www.cbo.gov/sites/default/files/114th-congress-2015-2016/reports/52142-breakout-chapter1.pdf

Make your own personal computer for $50

Raspberry Pi has made it relatively simple to make a computer for $50. Here is a step by step guide to making this computer. After you make it, attach an HDTV, keyboard, and mouse.

Buy your items: Raspberry Pi 3 Model B with wifi and bluetooth, a case, micro-USB power charger, HDMI cable, keyboard, mouse.
Several items may not need to be purchased such as the micro-USB power charger which comes with most Android phones.



Insert the Raspberry Pi 3 motherboard into the case. The case has a top and bottom which come apart. Make sure to slide the Pi board underneath a small ridge inside the case.

Download the Raspberry Pi OS which is based on Linux here. https://www.raspberrypi.org/downloads/raspbian/

Unzip the image file. Then write the image file to the microSD card using a program like Win32 Disk Imager https://sourceforge.net/projects/win32diskimager/

Push in the microSD card into the Raspberry Pi, plug in the HDMI cable to a HDTV, plug in the keyboard and mouse by USB, and attach the micro USB power cord. The OS should load up and start installation.

Or you could buy one for $60 with a 16 gb card by clicking here.

Snapchat IPO

Snapchat became public but it disclosed it doesn't make money. There's a significant amount of money it pays for its servers to outside organizations.

It may turn around and make money or it could become like many other high profile money losers with high valuations.

The bubbles in these stocks are interesting and provides an interesting market theory. Most investors don't touch these stocks but they are traded among the investors who do to a high market capitalization. Eventually, when it reaches a certain market capitalization, it has to be added to indexes like the Standard and Poors 500. At that time, the valuation goes higher and the risk averse investors inadvertently pays for a stock they would never buy. Eventually, the company proves that it can't make money and stock plummets while it's still in the index. The original speculative investors may have gotten out by that time and the passive investors are left with the losses.

Las Vegas Sands Covered Call Trade

Sold a LVS 2/10/17 put at $0.40 on 1/31/17 and then bought on 2/8/17 for $0.10. 75% return in 8 days.

Google January 27 2017 Covered Put Trade

Sold Google (GOOGL) put expiring January 27, 2017 on December 30, 2016 for $9.60. Bought put to close position on 1/23/17 for $1. 80% return in about 24 days.