Breakdown of Nick Sleep's Investment in Amazon Stock (7000% in 14years) | Amazon Stock Analysis
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- Опубликовано: 31 июл 2022
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Nick Sleep's investment in Amazon stock will go down as one of the all time great investments. Over the last 14 years, Amazon stock has returned a staggering 35% compounded return to investors, and Nick Sleep was one of the wise ones who recognised early that this business was extremely high quality, led by a visionary founder and had a long runway to grow. I apologise for the lack of interview footage.. unfortunately Nick Sleep hasn't recorded any interviews so the only way to hear from him directly is through his Nomad Shareholder Letters, and a chapter in Richer Wiser Happier by William Green. In this video, we take a trip back to 2008 to look at Nick Sleep's analysis for Amazon by reading through his letters, to see why he was able to recognise it as a quality compounder before everybody else. Hopefully, we can take some lessons to help us find our own 100 baggers in the future using some of Nick's teachings. If you haven't yet, I highly recommend reading his letters! As always, this is just a past example for educational and entertainment purposes. This is NOT a buy/sell recommendation for Amazon today.
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Book List Below:
Richer, Wiser, Happier by William Green - amzn.to/3iCp8Pu
The Psychology of Money by Morgan Housel - amzn.to/3EYQuXC
The Dhando Investor by Mohnish Pabrai - amzn.to/3ulAqtM
Rule 1 by Phil Town - amzn.to/3F3MJQJ
One Up on Wall St by Peter Lynch - amzn.to/3uoqCzo
The Intelligent Investor by Benjamin Graham - amzn.to/3F0kGkX
Influence by Robert Cialdini - amzn.to/3ulF2jJ
Poor Charlies Almanack: The Wit and Wisdom of Charles T Munger - amzn.to/3B3UbKg
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Footage Courtesy of Mohnish Pabrai, Amazon
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Hey guys. I'm stupid and said Amazon was a 600 Bagger - when it's actually a 60 Bagger... I accidentally wrote 600 Bagger in my notes for this vid and stupidly said it while recording without double checking 😫 My bad guys!
I hope you guys enjoyed the video! Thanks so much for watching 😀
if you find potential amazon don't forget to make a video :D
@@Atemi1990 dont worry brother I will haha :)
Important point on heuristics. Lots of investors are lazy, for example relying on what other people think (”polling your peers”) and making judgements on easy to calculate financial ratios. This creates opportunites for investors who are willing to do the work, and able to think for themselves.
Thanks mate! I thought you might find it interesting. The heuristic section really opened my eyes to how the mind looks for shortcuts and one has to be really disciplined to ignore it. And you're right, it creates opportunities for investors like us looking deeper than others! Analyzing 08 Amazon was actually really beneficial for me. Before I knew their figures, I kind of assumed back in the early days, they had really low returns on capital as they were scaling (especially free cash flow returns on capital). I expected it to be ok but not as good as it was. I cant believe people were ignoring a business with 30% free cash flow ROCE and 100% reinvestment rate with 20B Market Cap... its absolutely crazy to me lol
Great analysis! I think a really great investment has a good baseline return, with predictable cash flows, but also lots of optionality. I think this is what Amazon was in 2008. The optionality resulted especially in AWS, which was very hard to predict in 2008. But even without AWS Amazon would probably not been a bad investment, which was what Nick Sleep saw early on.
Yeah I agree. AWS has been one hell of a homerun business though haha. The only company I can think of with sort of the same characteristics is maybe Tesla, in terms of runway and optionality. Its just waaay bigger than Amazon (market cap) was back in the day. Not sure Tesla can 100x from here...
Great Video! Hope you are fine, we are already eagerly awaiting a new video!
Thank you kindly :) :) what type of video would you like to see??
Thanks for your videos. I also find the book "100 to 1 in the Stock Market" interesting.
Yeah I've heard that it's awesome! I must get it soon :)
Great Video
Thank you
Nice 👍🏿 video