A key part of portfolio management is to buy into weakness & sell into strength.  Both are tough to do. Neither move typically feels like the right one in real time... but both decisions routinely are.

At Stock Market Nerd, we are dedicated to disciplined portfolio management.  We now have a core holding up 100%+ in a few months, and it's time to take a little off the table. We are maintaining a large stake in this company, but trimming and protecting profits to opportunistically redeploy in the future.

Let's dig in.

Overall:

Year-to-date:

I am forcing myself to trim 13% of my Lemonade stake today. This is not something I enthusiastically or excitedly want to do... it is what feels prudent. And while I remain very confident in the company's future, when the stock doubles in 90 days while estimates remain flat, I have to take a little off the table. That gives me flexibility to add into any future corrections in this name or other holdings and is responsible portfolio management in my opinion. Feel free to disagree, as always. Lemonade has gone from around 15x 2028 EBITDA to 45x 2028 EBITDA in a year. Its forward gross profit multiple is now nearly 2x the S&P 500. It deserves a lot of that expansion and premium based on its surgical path to profitability, great underwriting progress and consistently accelerating growth. That's why it remains a top 5 holding. But? Risk/reward always worsens when a forward valuation triples like it did in this case and this is what I've decided to do in response.

*the order of the names in these lists below is meaningless.

My holdings that are performing & compellingly priced where I'd accumulate into modest multiple contraction:

My holdings that are performing & compellingly priced where I'm happy with what I own:

Uber and DraftKings fit into this grouping. I love both names being around 4% of holdings as prediction market and autonomous vehicle markets develop and evolve. I am confident in owning both names, but I want to see my bullishness proven out over the coming quarters and don't want either to be a top 5 holding while that happens.

My holdings that are performing & expensive where I'd accumulate into meaningful multiple contraction:

My hot seat – holdings that are NOT performing & need to do better if I'm going to stick around:

Watch List:

"If you were starting a portfolio today, what would it look like?"