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$WISH: 10x-20x Multibagger?

I signed up with WISH app while doing my personal WISH DD to understand more about the experience as a user. I’m currently a WISH investor with 2200 shares at an average of $9.4, my views may be biased and all views are welcomed!

Edit: Apologies and please bear with my long post! Just shooting off what I think…

To start this off, here are some of my favourite comments that I read about WISH and my thoughts:

  1. “WISH sells trash.” I don’t totally disagree with this. Even if 2 genius-level intellects consummate and have 10 kids, surely there will be at least one kid that is “not too bright” I guess. With WISH we’re now looking at over 800k merchants and hundreds of millions of products. There are bound to be trashy stuff, this is the same with Amazon, same with Taobao.
  2. “I don’t invest in Chinese stocks.” Maybe this stupid ape mixed up WISH with another company. We can actually Wiki this, WISH is an American online e-commerce platform (based in San Francisco, United States) that facilitates transactions between sellers and buyers. (But they do have a significant number of merchants from China, this is the same with Amazon, same with Taobao.)
  3. “WISH sells Chinese junk.” Similar to point 1, but will just like to bring us back to reality that made in China products are here to stay whether we like it or not. I can’t think of another country with a bigger population of people that works as hard, fast or cheap. China produce about almost everything from cars, to smartphones, tablets, stupid plastic toys, big city skyscrapers etc you name it. Look around your home and you’ll probably find something that’s made in China. Tesla cars, Iphones and many more big brand names are also made in China.
  4. “Scam. You’re going to wait months for something which may never come.” As a WISH user, I’m going to have to say that this is a myth. WISH is not a scam. $2.5b revenues in 2020, projected $3.2b revenues in 2021 and over 100m monthly active users are facts. If the product you want is not available, it will be reflected as sold out. When you place your purchase for an item which is available, it will come. Like most good e-commerce platforms, you’ll be able to check your order status (processed, shipped, arrival date etc) via the WISH app and there’s immediate 24/7 customer support whenever you need it. If you want your items urgently, you can pay more for WISH Express. But, if you’re like most WISH users that are buying not through a search query and instead from personalized browsing (basically it’s mostly impulse buys and not needs based), you can probably wait for your items to arrive which lowers the cost base. And no, it won’t take months. WISH quotes me an estimated 2-3 weeks for my items to arrive and I usually get them before the actual projected arrival date.
  5. “Goodluck with your imitation crap that you purchased.” This comment reminds me of the time when I was studying as a kid, my teacher used to say that copying from my classmates was wrong. As an adult now, I will like to share with her a quote from Oscar Wilde, “Imitation is the sincerest form of flattery that mediocrity can pay to greatness.” This next quote is from me. “In the business world, no amount of copying is bad unless we’re copying crap.”
  6. “Dishonest management, just look at the number of Class Action Lawsuits.” On the contrary, imo one of the strongest points which keeps me convicted on WISH is actually their stellar management team and how they are incentivised for their stock price to do well over the long term through stock based compensation with future vesting periods. Although not exactly the same, it reminds me of how Steve Jobs was paid $1 and the rest through Apple stocks. Just do a search on WISH management and you’ll see many familiar names to get excited about: Joe Lonsdale (ex palantir co-founder), Jacqueline Reses (ex Square Capital, ex board on Ali Baba), Farhang Kassaei (ex-Google, ex-Ebay) just to name a few. WISH is also in the select group of companies where their CEO (Piotr Szulczewski) is also the founder. Considering the amount of skin he has in the game as the founder, as a major shareholder and having rejected all the attractive buy-out offers in the past… I think it’s quite safe to say that he is not looking for quick short term profits and that he has big, ambitious goals for his “baby” WISH over the longer term. On the other hand, look into the Law firms and you may find no less than 50 companies per year that they are encouraging investors to file class action suits on. I’m a WISH investor just as a number of you are… do go ahead and join the class actions if you really think you can get any form of settlement. Personally I didn’t bother as many class actions from Law Firms just have no real basis or settlement results to show for and it feels to me like an advertising gimmick to slap their firm name on or some part of the manipulation game, a big waste of my time to even read really.
  7. “Look at the net loss and profit margins, WISH is not a profitable company.” Here is where we may have 2 schools of thought and the decision is entirely yours to make. Do we want to invest in a company that is contented at where they are, ie show healthy net profits and pass on those profits to their shareholders. Or, do we want to invest in a company that is ambitious, thinks big picture and re-invests those profits for explosive long term growth. WISH made revenues of $2.5b in 2020, projected $3.2b for 2021, and unlike many tech companies, this early stage tech set up can actually show net profits at any moment just by cutting back on sales and marketing expenses (look at their balance sheet). But instead, they are re-investing most of their profits into customer acquisition/retention, logistics infrastructure, scaling wish local, adding new merchants, product categories etc. Re-investing for growth is personally what I think separates a great company from a good one and I’d hate to invest into a company which passes their profits to their investors via share buybacks or dividends as it just displays to me a lack of innovation, that they do not know how or what to do with their profits to scale or advance growth. Amazon in their early stages warned their investors that they would re-invest their profits in the best interests of their shareholders for the long term, the smart and patient ones that stuck with them through the years deserve to be where they are today.

Why I’m a happy user of the WISH app:

For WISH users the satisfaction really comes from finding the gems, which is also probably the main reason why the average time spent per user on WISH app are far more than any other e-commerce platforms. Unlike fucking a dead fish, it is just so much more interactive and fun shopping with WISH app. Gems are basically good quality products with crazy cheap prices. A recent gem I found from WISH was a soundbar for my gaming needs which costs $24, it’s about half metre long and I’m serious when I say the sound and bass is unbelievably solid for the price that I’m paying. I will like to encourage anyone to just log into WISH app to discover the gems for yourself to truly understand what I’m saying, just search under “WISH select” and there are already tons of solid products which are cheap and good with many verified user reviews.

Just be warned:

As a WISH user, it all starts with WISH app prompting users to log in to the app with gamification, flash sales etc. And when you eventually do decide to see what they have to offer (with no obligations of course). The software prompts further discounts (from already very Low prices) for immediate purchases, adding in similar or complimentary product recommendations based on data and advanced algorithms… it’s like a dollar store on steroids. Most users and especially existing users like myself (with address/payment details done) conveniently make the purchases sooner rather than later and when we do, we potentially buy in quantity because of the low prices and understanding on the 2-3 weeks wait time. This brings me to another point: In order to truly enjoy the experience as a WISH app user, your expectations must be accustomed that lower prices come with a longer wait time. Good buys come with discovery.

In summary:

This is not financial advise, buy or sell as you $WISH… I’m just sharing my thoughts on what I believe to be an undervalued, underestimated powerhouse and hope to understand the views of others on this topic. I’m a long term investor and don’t expect WISH to pop immediately… I feel that it needs some time to mature and I will wait out the manipulation/accumulation phase. I believe that WISH is a 20x multi-bagger (my target price: $200) that is going to give the big boys in e-commerce a good run for their money especially once they awaken with the following:

  1. To have a fully comprehensive catalogue of products with different price ranges, moving upstream to touch a wider demographic audience.
  2. Filling in the gaps for product categories which are lacking right now in WISH app such as grocery products that are used daily by average consumers that require routine replacement or replenishment (eg: food, beverages and household products.)
  3. Increased sign ups of WISH users with stronger demographic profiles that prioritize services (branded product range, speed of delivery etc) over savings, this in turn potentially allows for rapid expansion on their logistics platform and accelerated growth in logistics/transaction revenues.
  4. Establishing WISH as a global brand and expansion of in-house WISH products. WISH seems to be trending more than just a cool ticker, it’s also trending as a cool brand with low priced, good quality in-house WISH products on their platform (such as WISH branded hoodies, t-shirts, charging cables, sun-glasses, bags etc). Back in the days, who knew a tick mark with the word Nike would move on to become a global top selling brand. Personally, I love the cool simplicity of the WISH logo and their mission to bring affordable and entertaining mobile e-commerce to consumers around the world including the underserved. With over 300,000 WISH T-shirts sold currently, in my mind it hints the potentiality of how the WISH branding might scale, in an internet world of social media trendings and smartphones.
  5. Tapping on Jacqueline Reses’ (ex-square) expertise and experience to accelerate their entry into payment and financial services which will further monetize their growing merchants and user base. Imo their user base is likely to grow rapidly regardless of what haters are saying. As a WISH user myself, I can only say that my experience with WISH is just starting and it’s worth referring my friends. I believe this experience is not unique to me and that I’m just one out of many users that loves WISH app and the WISH brand. With over 100m monthly active users, over 500m total WISH users, over 3m of items sold daily, most downloaded app globally for past 3 years, we can’t be getting it all wrong. As the saying goes, it only takes a spark to get a fire going.
  6. Expansion in WISH Local Merchant base. WISH is strategically focusing and expanding WISH Local and I can understand why. Imo this is the most underestimated revenue generating model that they have, and one that can pose a serious threat to Shopify. Wish Local can potentially create a sustainable ecosystem and rapid revenue growth while offering a lifeline for brick and mortar retailers to succeed in an era of disruptive tech and innovation fast forwarded by the pandemic. WISH will be able to store their inventory orders with WISH local merchants, saving costs on storage and last mile delivery (This also translates to reduction in time taken for delivery and further cost savings for consumers). WISH local merchants get to increase their personal product sales through WISH inventory pick ups as it translates to increased customer footprint and potential sales opportunities. Wish local Merchants can also tap on the millions of WISH users by advertising their products through the platform. It’s basically a potentially easy win for WISH, their merchants, their customers and ultimately shareholders.

In addition to the above potential catalysts:

  1. WISH have massive cash on hand of about $2b and no long term debts (Reduced risks from inflation fears + potential buy out candidate)
  2. Strong potential growth in WISH users spending and new user sign ups from their existing marketing strategies, pandemic driven consumer behaviour towards digital/online shopping, referrals/word of mouth from existing users and social media hype. WISH also participates in an huge e-commerce market that’s expected to reach $4.5T by 2024, benefits from emerging countries/markets growth and is also a large beneficiary from the huge market of Gen Zs. (Potential monster earnings growth + COVID play)
  3. Super undervalued at $6b market cap vs $3.2b revenue projections. Great entry point below $10, we’ll have an average which is below most retail and institutional buy in. At these prices we’re looking at a 60% discount from IPO and 70% discount from all time highs. This is imo the last e-commerce powerhouse which still haven’t popped, just take a look at Etsy, Shopify, Sea Limited to name a few. If you see bear reports on WISH, like as if they had a crystal ball telling you where the stock is headed, please think through whether if it sounds logical or suspect to you. All I can say is that trust no one but yourself and your DD, it’s your hard earned savings after all. To share a true story: When NIO stock dipped to $10 from $15 back in July 2020, a friend of mine sold all his holdings at a loss trusting on a report from Zacks and “analysts” and bought other stocks recommended by the same “analysts”which were deemed “safer”. Almost just after he sold, NIO went on to 6x within 6 months and today he is still in the red. I don’t hope this for anyone, but in summary, weak hands that lack conviction or patience may regret months down the road when they make silly decisions. Maybe that’s just another catalyst and what it takes for a stock to rocket, when the weak hands are shaken out and new short positions opened based on bear reports. (Reduced downside risks vs potential upside + squeeze play.)

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