Cutting my flowers and watering my weeds? (ZM, SQM)

I bought Zoom (ZM) about a month ago (4.23.19) and it's already up 50%. I know the old adage is ride your winners but yesterday ZM was trading at a valuation of over 60x sales, which is, to be technical, full-throttle nuts. So I sold my gain, so far, leaving me with my original investment.

What to do with the the money?

I was SO tempted to spend it on SQM, which is a lithium play that is currently paying a forward dividend of  EIGHT PERCENT, but I hesitated because A) I just bought more SQM and B) the total loss that was Cable and Wireless, also a dividend play, still makes me fearful.

But, but, but... SQM is profitable! And electric cars are inevitable in the next 3 to 5 years, a fact that should materially increase the demand for lithium! And Simply Wall Street says SQM is trading for 66% LESS than future cash flow.

Argh.

So.

Tempting.

Mulling...

Buying more SQM to ride the lithium wave.

I bought SQM several years ago and it's been great but recently SQM's price has been falling as analysts fret over the prospect of the lithium supply doubling and as a result the price of lithium being cut in half. They know more than me, I am sure, so let's say they're right and big lithium producers basically see flat revenues for a few years (something I doubt), so what? SQM pays a dividend of nearly 7%. That is one juicy dividend for a financially solid company operating at a profit in a growing market. Of course, the last time I bet on a stock for the dividend it was Cable and Wireless, which went bankrupt. But it's different this time, right? Right? Knocking on wood...

It's coulda, shoulda, woulda Wednesday: EBAY

I was just listening to the Bob Lefsetz Podcast episode in which Bob interviews Linda Perry. She's talking about her dad and how should be so rich today because back in the 1970s he was RIGHT SMACK IN THE MIDDLE of the computer revolution.

Reminded me of me! Because back in the 90s I was RIGHT SMACK IN THE MIDDLE of the dot com boom. I have a LOT of coulda/shoulda/woulda stock market moments from that decade but I'm going to kick off this coulda/shoulda/woulda series with EBAY.

Here's the moment of truth that I remember: I was at a get together in a park in Menlo Park, CA, and talking to a friend about where to invest. I was preaching Onsale.com, while she was all about EBAY.

My logic was that Onsale's business model of buying up clearance items and reselling them was way better than EBAY's auctions for the simple reason that with Onsale, customers were buying from a business while EBAY customers were buying from whothehellknows. For awhile, I felt smug in my rightness as Onsale rocketed from around $15 (my buy price) to around $100. Did I sell? Hell no. Stupid, greedy, dumbass me.

Honestly, Onsale STILL makes sense to me but they are long out of business, while EBAY has risen from an adjusted price of about $.80 in 1998 to about $35.

Ouch.

Coulda: had money

Shoulda: 35x gain vs. bonfire of vanity as I held on to Onsale to sustain a total loss.

Woulda: Except I just did not believe that EBAY's business model would succeed, never occurred to me that a system so dependent on decentralized trust could ever succeed, still seems amazing!

Lesson learned: When you buy stock and it goes up nearly 10x in a few months, SELL.