Execution Memo No. 9

Haypp, Tempus, and TPB face their moment of truth

For those new here; this is where I share my trades and ideas.
This time, it’s chaos. All the main stocks I follow basically reported earnings today; and of course, it all happened while I’m traveling.
I’ll run through each of them quickly and share my thoughts.
Some names will get deeper, separate write-ups later.

Let’s begin.

Haypp – Business as Usual

Most of you are here because of Haypp. If you read my earnings preview, you already knew what was coming. My latest prediction turned out to be the most accurate yet; the web-based estimate was almost spot on.

Gross margin came in strong, while earnings themselves weren’t that impressive. I see the gross margin as bullish, and the weaker earnings as expected given Gavin’s earlier commentary. I haven’t had time to watch the webcast yet, so I’ll post a deeper piece on Haypp later.

A few things still stand out:
First, they’re withdrawing from the UK vape business. That was somewhat expected but largely overlooked. It’s not great news, as the emerging vape segment had shown strong growth and received solid investment. However, Germany remains, and it represents the majority of that segment.

Second, management continues to focus heavily on the U.S. They sound very optimistic about the expansion there; and it makes sense. If you make a rough DCF based on population and regulatory scenarios, you quickly see that the U.S. will likely contribute the vast majority of Haypp’s revenue in the not-so-distant future. In some of my models, as much as 97% of Haypp’s value comes from the U.S.

Anyway, I’ll cover Haypp in more depth soon once I’ve had time to go through the details properly.

Tempus AI

I’ve been following Tempus AI very closely and see it as a highly promising stock; though undeniably expensive. It’s one of those names that could just keep climbing like Palantir, which makes “waiting for a dip” a questionable strategy. If you haven’t already, check out my deep dive for more context on the company.

Tempus reported earnings yesterday after market close. They double beat and raised guidance. The story looks strong. Still, the stock traded slightly down as expectations were sky-high and comparable names; most notably Palantir; have been slipping.

Tempus is one of those companies that, despite executing well, tends to trade more on market sentiment than on its own developments. I’ll publish a deeper dive into the earnings soon, but until then, I’d recommend extreme caution; this is a volatile stock.

Turning Point Brands

This is where my earnings day got interesting. TPB was up 26% in pre-market after posting great results; nicotine pouches are clearly becoming the main story. I think TPB will continue to be a winner.

However, the stock only ended up around 6% instead of 26%. That gave me another chance to buy more. There was a brief moment when one of my 20k option positions, bought specifically for the earnings, was worth around 400k in pre-market. Unfortunately, the options weren’t liquid enough to unload at that price.

I’ll talk more about TPB in the last section, where I explain how I’m planning to profit from the stock’s price action.

Other

Outside of that, Recursion announced a CEO change. I’ve had basically zero time to dig into it yet, so I’ll comment more later.

I also got interested in Nokia last week but decided against the trade. It’s more of a turnaround story than a true AI play, although the NVIDIA partnership does make it somewhat interesting.

Finally, my Prime Medicine position is currently negative after the stock dropped hard following NTLA’s trial halt, which pressured the entire gene-editing sector. That said, it might present an interesting buying opportunity.

What I’m Doing Right Now

Here’s a quick recap of what I’m doing based on the new information and market moves.