Today, we are looking to increase the stop loss rate in the Life 360 (360) position. Increasing the stop loss is a safety play in case the recent strong uptrend reverses.
The Life 360 fundamentals look strong: –
- The company now has 70 million users
- Plans underway to place advertising on the free version of the app
- Adding advertising is a low-cost way of increasing revenue
- Recent price increases have not slowed new customer uptake
- Like many tech companies, they have become profitable within the last two years, and EBITDA is growing strongly
We are only increasing the stop loss from $14.40 to $16.00, which is 16% below the current share price. We would normally have the stop loss much tighter, but we want to account for the recent sharp pullbacks the share price has experienced.
TRADE ACTION
Current position: 300 shares purchased at $13.39
Stop loss: Increase stop loss to $16.00
