Tailwinds Select Portfolio ~ March & Q1 Performance Review

Well, we’ve come to the end of the 1st quarter and it has ended with a bang. As of today, the Select Portfolio is up over 30% since inception with the average stock up 20%. This is the result of good performance all along, but particularly so of late.

For March, the return for the Portfolio was 7% with the average stock up 6%. The total return of the Portfolio for the first quarter was over 10%, with both February and March making up for a down 5% January.

While these results on their own are certainly pleasing, they are doubly enjoyable when compared to the performance of the market in March. As you can see from the chart below, the Russell 2000 turned in a mediocre performance.

Digging deeper into the performance numbers, we had 5 stocks return in double digits this month. AQMS, which, through its growth, is our biggest position, led the way with a 15% return and an outsized boost to overall performance. Beyond that, we had good earnings/guidance from RESN which pushed them up nicely. IBIO broke out of its doldrums and moved higher. And, finally, CYRX was added to the Portfolio at an optimal time (after a financing done in the hole) and it looks poised to bounce way back.

On the negative side, BTI.V remained under pressure (read more about this below), while ESTE traded sideways in a weak oil environment. VUZI put in a great performance, basically treading water despite a coordinated attack from a group of short sellers. All told, nothing went really wrong and these three stocks remain core beliefs here.

Portfolio Company Updates:
AQMS: Aqua Metals was up 15% this month, in a period of no real news. Oppenheimer put out a revised price target of $30 and a model that really reflects mine in many ways. I think they are underselling it and still believe it’s a $50 stock sometime in the future.

ESTE: Oil remains under pressure as do oil companies. Earthstone reported earnings for Q4 and 2016, but these are really not meaningful as we knew what to expect. Going forward, we’ll see the merger with BOLD close in Q2 and some well results.

BTI.V: biOasis finally came clean with what everyone thought…they announced a financing. The stock has been hurt in front of that, but, as detailed here, I believe this financing is a catalyst to push the stock to new heights. From here out, I believe this will be the best performing stock in the Portfolio for the balance of 2017.

iBio: this company sits and waits…and waits, and waits. News will be coming but management is quiet. Meanwhile, the stock did bounce nicely off the lows. Deep value with great growth potential. Just no visibility. We own it and are waiting.

VUZI: as mentioned, shorts attacked the stock, yet it holds in nicely. Expect Vuzix to have some more partnerships announced soon. The company continues to lead the AR market and is very well positioned. I believe it’s a takeover candidate in the not too distant future.

RESN: earnings, despite no revenues, was the catalyst to get Resonant moving. The guidance here is great. The important thing is customer traction is providing increased visibility into their ability to meet their guidance. This stock should be a good performer going forward as they continue to win sockets, each of which derisks the story that much more.

CYRX: the latest addition to the Portfolio, Cyroport did a deeply discounted financing. Business is great, and now, so is the balance sheet. I fully expect this company to grow dramatically over the next several years and this selloff on the deal is the definition of a “gift horse”.

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