These Stocks Are Scamming You
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- Опубликовано: 6 сен 2024
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Will you ever add a ad-based version? 😅
Ubisoft one such company using stock compensation. It essentially means that anyone who invest in the company gives cash to the employees and since the company hire and fire people the stock just keep going down.
I love this video. I tell people this all the time
Thanks for the heads up Joseph I wonder if people that experienced the 2008 crash had it easier because this market conditions are driving me to insanity, my portfolio has lost over $23000 this nov. alone my profits are tanking and I'm don't see my retirement turning out well when I can't even grow my stagnant reserv.
As a new investor it's always great to hear from a person who has gone through all the difficult times and come ahead of it. It's unnerving to see your portfolio go from green to red but as mentioned if you have invested in quality names just have to keep adding to them and stay the course
Same here. Somebody is profiting but not me 😞
Invstors need to act cautiously but remain vigilant in monitoring the market landscape for opportunities to pick up high-quality assets at discounted prices. These are difficult environments, but they also coincide with the best opportunities.
I buy the idea of employing the services of a Financial Advisor because finding that balance between saving and living requires counsel. These are crazy times we all need help .
Forex trading is the best investment one can do right now though stocks are good but ever since I swapped to Forex trading , I've seen so much difference
I have been making a lot profit through forex trading which has been the main source of my income
Actually an expert broker handles my forex investments while I invest in some real estate with the profit I make
John Hook handles my investment portfolio, he's an expert when it comes to trading forex.
He made over $12k with my $2k start up capital
He's available on G mail
Were you able to pull your money out before FTX US went under?
This is a fantastic video, need more videos like this. Avoiding big mistakes is more important that finding massive winners
Rule number one don't lose money, rule number two, don't forget rule number one
Thought FTX was going to be mentioned as a scam too, disappointing
I thought that's what this video is about lol. Didn't they sponsor his channel?
@@alejandromijares1006 My affiliation with FTX ended over 2 months ago.
If they were paying me with the deposits of other peoples money that is a fraud and misappropriation of funds and they will/should be held accountable for it. When I signed with FTX 6 months ago they said that their earnings were from the operating income of the business through trading fees. They even put a public statement out that they made 200 million in operating income.
I also did address the situation on the first segment of my most recent episode on the other channel.
@@JosephCarlsonAfterHours appreciate the explanation, as long you addressed it to your viewers to give them a chance to pull their funds if they somehow weren't aware is what i think matters
@@kiuki42 he is just barking. Joseph Carlson should be investigated by the FTC. This mf have no shame.
@@JosephCarlsonAfterHours you shouldn't have even gotten involved with a crypto exchange in the first place as it represented an obvious conflict of interest.
For someone who claims to be about transparency, taking their money was an extremely disappointing decision. Nobody expected FTX to be a fraud of this scale, but the reasons to stay away from them were there. Hopefully this serves as a lesson
Hey Joseph I saw that FTX and FTX US filled in bankruptcy and in one your latest videos you said that lucky your money is still safe in FTX US, but that isn't true after all. I hoped you did more research in FTX as you always do with your investments.
I saw that - it's actually amazing the things the CEO is saying. Just yesterday "FTX US is 100% liquid, assets are backed 1:1" Then the very next day "FTX US is filing for bankruptcy".
Fortunately, it does look like the majority of people have been able to get their assets off the US exchange. I have looked at a reddit thread where there were dozens of comments (almost all) saying that they were able to withdraw successfully. As for my situation, I had a little over a thousand dollars on the platform that I hadn't taken off. Yesterday I sold and requested an ACH withdrawal. It looks normal so far, the transfer says "sending" and it can take up to 5 business days, but we'll see, who knows.
In terms of research. Just to give some context on the overall situation.
About 7 months ago I was contacted by FTX to sponsor my channel. My initial answer was no because they're a crypto platform. But they said they were launching a new regulated stock brokerage that they wanted me to advertise. I told them yes under the condition I would not have to advertise the crypto platform. They agreed and we signed a 90 day contract. About a month into the contract a lot of smaller crypto exchanges imploded and the entire landscape changed. Since this was one of my first sponsored contracts ever I didn't write in an easy-out of the contract. I become more concerned about working with FTX so I had a lot of discussions with family, friends, and close members on my discord. Their council was almost unanimous to just fulfill the contract and be completely done with it after that. That's what I did.
It's easy to look back in hindsight. But 7 months ago no crypto exchange had gone under. FTX was the second largest player that was sponsoring stadiums, the NBA, NFL, MLB, Kevin O'Leary, Steph Curry, Tom Brady, and dozens of RUclipsrs, their company had major investments from Sequoia and had publicly stated that they made over 200 million in operating income. This isn't to make an excuse, just to give context. There was still a risk to it as they were a private company and I couldn't throw their ticker into qualtrim to see their financials myself.
So obviously I regret taking them on as a sponsor knowing what I know now. If I could go back I would have never let them sponsor my channel. And I'm making adjustments to what I will and won't sponsor to avoid having something like this ever happen again.
@@JosephCarlsonAfterHours Don't you think an apology to your subscribers who lost money on this is in order? You always said you don't invest in crypto - true. But your channel was a vehicle for people to lose money a few clicks away.
@@thilgu I agree, Graham Stephan was in the same situation and he apologised.
@@thilgu I did address the issue in full in the previous episode of my other channel.
@@JosephCarlsonAfterHours You are right. Missed that!
One of the best vids you’ve made Joseph. Great work
FTX
It’s not how SBC works Joseph. What companies expense as SBC is not what they actually paid. All depends on vesting policy, price of the stock when grants are being issued to the employees etc. it’s more that goes into it!
Although Joseph did support FTX he is doing okay, and would still watch him anyday otherwise I feel we need more expose videos on these other "not a financial advice" RUclips influencers.
Do you take seriously any advice from influencers?
@Zoe Smulders I don't know your full situation so my suggestion, research for those with reviews/testimonials they will love to talk to you. This is FREE. That’s how we found ours, specializes in bear markets and has predicted almost every event in this territory correctly including the recent rally.
@Zoe Smulders You don’t have to take my word for it or anyone else’s for that matter, do your own dd, but make sure to hire a fee only advisor. Handing over your life savings to someone and then also hiring them as your advisor is an inherent conflict of interest. I have been better than 95% of the other analysts/experts I watch on RUclips, and frankly I have profited considerably as a result.
@Zoe Smulders She’s in Boston, goes by Tracie Lee Paige you can locate her if you searchh her out, wouldn't be wise to leave her phone line lurking around, she advised against it as she says she receives a lot of unsolicited messages. After fed policy began in late 2021, we moved to cash during the big January sell off. She restructured my portfolio and we began working with a long/short defensive strategy. You can ask her about fees. I didn't pay upfront.
@@lucaguzman7253 Great timing. I was not able to sell in time, I took a glance at her page, she wrote the exams and seems proficient. I will like to have an interview with her, bookmarking this.
One of your best videos so far! Very important topic and gets easily forgotton or completely left out. Thanks Joseph
Amazon Net Income TTM = 11,23b vs Stock-Based Compensation = 17b. Just saying ...
This video is a bit misleading with the assertion of some of these companies "scamming." I don't think PLTR is scamming. It's a company that has reduced its SBC over time and increased its earnings. Also, I personally work with this company's product in my job. Can't necessarily call this one a scam...risky yes, but not a scam.
I agree with crappy companies like snapchat, but I still think PLTR is going to be resilient and isn't really using the share holder as the bag holder.
Palantir will change SBC as the quarters go on. It's dropping every quarter.
I would love to see EV/FCFF added to Qualtrim. Damodaran’s method of valuing companies is one of the best.
This is one of the most important info that I have been able to have regarding investing in the past year. Very interesting. Thanks a lot.
Honestly, Joseph, I was gonna come on here and tease you for the FTX scandal. But this video is a plus plus plus. An enormously Valuable video for investors bravo.
I am just wondering do SBC get captured in increase in number of outstanding shares after vesting ?
You've returned a Great value for us,thank you mister Joseph! I respect your time and analysis. this format is phenomenal. The only thing I would add in this format is a comparison of stock compensation with share buybacks, along with free cash flow. A comparison in the top three would give even more data on the character and moral qualities of management.
Half-way through the video, when Joseph was talking about Adobe and Salesforce, I was thinking "lol, this is nothing: I hope he looks at PLTR."
Dear Joseph,
I appreciate your content and watch almost everything. However I do disagree with your statement about cash bonus being equal as SBC. I have worked a long time as a sales rep for a company that paid me hefty cash bonuses. This however will make you do whatever will get your bonus paid. It does not matter if it hurts the company in the long term, as long as you will receive your bonus in the short time. Whilst also possible with SBC, it does mitigate this a little bit. If you as an employee will perform actions that are not in the companies best interest your SBC will be worth less in the long run.
Keep up the good work however!
So many retail investors are falling for the PLTR scam; this is literally dumb money flow.
Isn't that why we check net income or net profit?
thanks for the great info. I'm just beginning to invest. I'm hearing that even though the market is confusing right now, that I should continue investing weekly into my Total Market Index Fund. I know I'll lose some money, that's the risk. It will be difficult, but I feel like I should stay in, and continue to invest in good and bad times and not try and time the market.
I am more into maximizing dividends, as the market goes down, I take those dividends and invest them into lower share prices. At some point these will stabilize, and the market will go up(what goes down, goes up sooner or later).
My wife and I are retiring this year with over $6,000,000 in tax deferred investments. up until 3 years ago we were 100% in the S&P. During bear markets we had a perfect plan. We got an investment manager in our corner and didn’t look at our portfolio for nearly a year. Just kept buying at low prices.
“Markets are constantly in a state of uncertainty and flux and money is made by discounting the obvious and betting on the unexpected.” -George Soros
@@tonymiller6550 Great job ! I’m a young mom and I would love to achieve this level of success myself please is it possible to get to your manager ?
Thank you. Her name is Amie Cathrine Shapiro. I really don’t know if you can hire her also but she is well researched. Just look her up online.
Informative to say the least. Thank you for the enlightenment. It’s too bad I learned a little late about TWLO
Is there a free trial for the qualtrim membership so I may try it out?
This is an incredibly important topic that doesn't get nearly enough coverage. The average retail investor is likely oblivious to this 'scam' and unlike the PE and market cap etc... This metric is rarely ever displayed on a stock's brokerage information.
This should be the 101 test for anyone. It provided a lot of information about options and why a company changing the options to benefit themselves is a selfish money grubbing company who only care about themselves and uses investors to scam them for profit.
“The most egregious case of let's-not-face-up-to-reality behav- ior by executives and accountants has occurred in the world of stock options. In Berkshire's 1985 annual report, I laid out my opinions about the use and misuse of options.57 But even when options are structured properly, they are accounted for in ways that make no sense. The lack of logic is not accidental: For decades, much of the business world has waged war against accounting rulemakers, trying to keep the costs of stock options from being reflected in the profits of the corporations that issue them.
Typically, executives have argued that options are hard to value and that therefore their costs should be ignored. At other times managers have said that assigning a cost to options would injure small start-up businesses. Sometimes they have even sol- emnly declared that "out-of-the-money" options (those with an ex- ercise price equal to or above the current market price) have no value when they are issued.
Oddly, the Council of Institutional Investors has chimed in with a variation on that theme, opining that options should not be viewed as a cost because they "aren't dollars out of a company's coffers." I see this line of reasoning as offering exciting possibilities to American corporations for instantly improving their reported profits. For example, they could eliminate the cost of insurance by paying for it with options. So if you're a CEO and subscribe to this "no cash-no cost" theory of accounting, I'll make you an offer you can't refuse: Give us a call at Berkshire and we will happily sell you insurance in exchange for a bundle of long-term options on your company's stock.
Shareholders should understand that companies incur costs when they deliver something of value to another party and not just when cash changes hands. Moreover, it is both silly and cynical to say that an important item of cost should not be recognized simply because it can't be quantified with pinpoint precision.” - Essays of Warren Buffet
If you’re going to invest, just duckin read these 4 books. They contain almost all of the psychological values of investing that people have echoed for decades now:
Intelligent Investor
Common Stocks and Uncommon Profits
Essays of Warren Buffet
One Up on Wall Street
How hard is it to just *read* these books?
You can find them online for free and will learn more than joining these paid investment groups run by “RUclips Finance Entertainers”
Very educational and valuable! Thank you!
Hey Joseph i think sbc is expensed under net income from what i understand
Just a heads up thanks
Dividends can be paid with debt.
FTX is scamming you
The reference to Burry's letter made things more clear. Thanks for adding this to the video.
You don't seem to understand growth companies. Why would growth companies pay dividends when they can invest for growth?
Also, SBC isn't a "scam", just because most investors don't look at it or don't understand financial statements doesn't make it a scam. That's why you look at both income statement and cashflow.
It is a scam in the sense that a very large proportion of employees will never be with the company long enough for it to actually vest and in effect have been cheated out of real compensation.
Always demand cash upfront.
Then there is another latent problem with it even when the stocks do vest. How liquid is the stock? If you cannot even get anyone interested in buying it on the market then it may as well not be compensation ta all.
In terms of the statement itself. It doesn't even matter and Joseph just doesn't know what he is talking about.
Great video ! I just didn't understand something, why employees of companies like snapchat accept to be paid with crashing stocks ?? Unless they immediately sell them, they are losing too, their portfolio is crashing along with the other investors. So is there an indicator that is saying if the employees are holding or selling their stocks ? It could provide real informations about the confidence of a company
In many cases there's a vesting period that prevents the employee from selling until after a period of time has passed. The problem with higher salary or cash bonuses is that after you pay out the money the employee could leave and go work for your competitor taking all that money with them. The gentleman in the video is well aware of this but he is purposefully leaving that detail out and oversimplifying things both to make his content more digestible for a wider audience and also as a way to sell you on his software product.
@@kg3436 ok but anyway, it's not interesting for employees of such companies to be paid with those stocks. Personally I would leave the company instead of accepting monkey stocks as payment
I've always believed CRM was a fantastic company, but always felt the increase of its stock price lagged behind some of the other companies I owned. This video points out one of the possible reasons why that may be. I will say I have stumbled onto Joseph Carlson's videos (watched about 10 of them in the last 24 hours). He is straight to the point and wastes zero time in addressing the video's topic. Thank you for sharing your methods and rationales in such a professional manner.
Why stock based pay is not illegal??
Because the rich individuals who support our politicians would never allow such a thing to be illegal.
Joseph, I’m surprised that you didn’t mention that stock based compensation usually has a vesting period (4 year avg from my experience) from when it is rewarded, and a massive amount of that compensation may not need to be paid out. I don’t have the data as to how much stock based compensation actually gets paid out, but it could be quite substantial. I do agree that SNAP and PLTR seem to be abusing it. Keep up the great work Joseph. I really appreciate your well thought out videos.
Does Joe still push FTX?
That's not accurate - I have not been sponsored by or affiliated with FTX for a couple months now.
@@JosephCarlsonAfterHours respectfully, you should make a video addressing FTX.
Great and revealing episode Joseph!
Really insightful. Thanks Joseph!
Im really intrested to be patreon but could there be some sort of info button by every graph that explains for exmpla what free cashflow is etc for all terms
This is great, simple explanation any investor can understand
If you're seriously considering Michael Burry's argument re SBC, much of the Story Fund would be out, at least if compared to the industrial/energy stocks, which are actively giving back money to investors hand over fist.
There might be an economical turmoil but there is no doubt that this is still the best time to invest
Best time to invest? thats funny though because in the last four months I have lost more than $47,900 in stock market which is the biggest I have loss since I ventured into stock investment.
you could be right or wrong . i once had similar problem but now its a different ball game for me because I was lucky to have met Karina Mattis , a financial manager and stock expert, I have made more than $165,000 in 6 weeks under her supervisions
Search her name on the internet to reach her
Biggest scam - FTX
Thanks for your advice Joseph
He already addressed the FTX situation. Why the need to continue beating a dead horse?
@@hondusspa He did? What's the title of the video? I haven't watched the most recent ones yet but I'll put that first on my list if you can tell me.
@@hondusspa FTX US just announced bankruptcy, im not sure if people can still pull money out?
Your FTX recommendations scammed people …
You need to fully own what you did and apologise sincerely.
one of the problems is that those companies publish non GAAP earnings that exclude SBC as an expanse, and then the analysts of those companies talk about these earnings in term of non GAAP and project forward PEs based on those non GAAP earning and those PEs are also used many times when talking about the PEs of all indices.
I think what you are seeing, especially in ADBE, is employees electing to take a percentage of their salary in the form of the Employee Stock Purchase Plan. Just about all companies offer an ESPP to ALL employees but only a select few employees take up this offer. But because ADBE ESPP is very generous with the stock discount, many employees elect to max out their ESPP. Therefore, this metric winds ups showing up in the larger SBC section. Employees can change this election, so to me, it's not necessarily the company being "tricky", just they have a generous discount on the ESPP they offer to ALL employees and employees are utilizing it.
I would love to see this philosophy, which I agree with, applied to growth companies like AMZN. Will AMZN eventually pivot financial strategies and begin paying out to shareholders? Should we hold these kinds of growth stocks under the idea that they one day will? Or just hold them for the growth under the idea that we'll one day sell them according to the 4% rule, or all at once? "Speculative Dividend Payers"-or something similar haha.
Thanks for the great points and content!
If it's not a dividend payer, it's a flipper.
Companies can do 5 different things with their FCF. They can pay down debt, pay dividends, buy back shares, reinvesting in the company, and acquiring new businesses. AMZN does the latter two of these. If they are growing the company, it is good for shareholders.
No wonder, thank you very much for this information.
How about APPL? Does it have more stockbased compensation than its cash flow?
Wow! Didn’t know stock based compensation was that severe. Great, great video
I learned something new today even though I have got paid using RSUs. In the past you owned Twilio if I'm not mistaken, would you say you missed this part during your research at that time in valuing the company?
Where is the FTX sponsor scam example?
Thank you for covering this! Very important topic.
Is there any metric other than SBC where this impact can be seen? Is it reflected in net income?
Losing money is only ok if that means other VC's will have justification in further investment (beyond initial VC funds) for a company that grew their market share. I always assume I won't be a 'chosen one' and will have to break even while growing, but if you make a profit; valuation is done by p/e and you want to delay that as long as possible (because growth stocks have to do that.)
What website is that where i can compare the free cash flow and the stock based comp for free?
Can you do a video on real estate stocks value like redfin, Zillow , open door etc .
Always informative and love your video and product!!!
Genuinely asking because I am trying to learn, but most of these companies that show positive cash flow now started with negative cash flow when adjusted for stock based comp. Again really have not idea just trying to learn
Great topic and coverage. Thanks very much.
Great stuff Joseph. One of the best information videos I’ve seen for awhile.
i think with Jeff Smith taking a stake in CRM, they will increase margins and strengthen free cash flow. I am noticing whispers of rightsizing, which is not traditional for CRM.
@joseph, this is so helpful! Would you say this issue applies to Intel? And Tesla? Esp with Elons weird pay packages
What are your thoughts about Amazon having a substantial amount of stock based compensation?
Is FTX Brokerage FDIC insured ???
FDIC is for banks. SIPC is brokers. And yes, you can check on SIPC website and FTX capital (their broker business) is listed as a member.
Very good analysis. Thanks Joseph.
Scams like promoting FTX like your life depended on it?
Thanks for the video and graphs.. Beautifully explained.. I knew how stock dilution is a big thing from Everything Money channel ..
Very valuable information, thank you!
How is Amazon any different? Love your work btw
Joseph, do not throw stones when you live in a glass house. Can someone say FTX!
Very telling, Joseph! Thank you! Would like to see regular warnings about companies who do this. More accountability for companies = better decisions for retail investors. I watch all of your vids, asos thanks again.
The craziest part of stock-based comp is that it doesn’t even align interests unless it represents a large % of an employee’s net worth.
Free cash. The banks invest in the companies as well.
Where do you get your StockBased Comp from? Is there a source we can check as well?
On the cash flow statement of every company.
Some would say that if you keep the company and its employees happy, that's a good thing for it's morale, and ultimately, it's final product.
See the current state of Twitter for an example of treating your employees as expendable things and only caring about the money.
If he didn’t “care only about money” the company would have went bankrupt and then ALL those poor staff would have had no job, rather than just half of them. But you don’t care about that do you? You just love to tell a victim/big bad man story, without checking a single fact. Pipe down.
Thank you, this is a eye opening video!
Please make such great insight videos thanks
Joseph Carlson, you are incredible and a rare gem indeed.
If company does not dillute shareholders by issuing new shares, why such compensation is a problem? And Adobe does not issue new shares.
I can’t shake the feeling we’re getting the best of JC reputation damage control without calling it that.
Awesome video Joseph!
Check Unity software, worst performance and very high stock compensation.
Indeed very informative. I knew about Snapchat, but did not realize it was more widespread than that. I ll keep it in mind next time I buy stocks.
Great job Joseph! Keep doing!
You hurt my feelings when you attack my PLTR bags :(
Does anyone know what the same chart for Tesla looks like?
Terrific video. Excellent subject. It is of utmost importance to understand the relationships between investors (shareholders), employees, executives (management), and cash (profits).
"Who the bells toll, they tolled for thee"...LOL!
Once, I was offered work by a company owner as a financial advisor. My first question endup offening owner was: What is your business model? In other words, how does the business works and he was offended. LOL!
Wow, this should open your eyes! Certainly did for me!!
Great job Joseph! Very informative. You certainly deserve a "like" on this one. Can you please do this for Tesla? Thanks
Oh, and Bill Ackman too, insists only on buying long-time, long-established, publicly traded companies. Look at at his port: Lowe's, Domino's. It would be comical to see Palantir or Twilio in Ackman's portfolio. Joseph is spot on in this video. Great, great video, Joseph!!! It's a subject that needs to be pointed out!
Good hearing from you again Al, hope all is going well!
Wow, I was not aware this was such a significant thing to watch our for. Kinda scary it is not obviously reflected in the most commonly looked at metrics.
Great video! Very helpful
Como siempre, muy buen vídeo. Contenido de mucho valor. Great job!
I'm new to your channel, but wow do I like it so far... looking forward to more
Where can I get a copy of that letter to shareholder, I'm interested to read it more