December 31st, 2019 seems a disproportionately long time ago. When David McCullough and Ken Burns finally get together to decide just exactly what happened over the past six months, I doubt that the formation of Antrim Investment Research, LLC or the publication of my coverage initiation on Despegar.com will rank among the defining events of the first half of the year. Nor will I merit a musical number in Lin-Manuel Miranda's next production. Nevertheless, Antrim has taken over a tremendous amount of my energy and focus over the past six months, and the developments of the past few weeks have been significant milestones for myself, and for the company. In progress, then, is an update for my readers on where Antrim stands today, and where we're going (for now).
In June, I completed the process of registering Antrim as an Investment Advisory in the State of Virginia. Despite a growing number of blogs, newsletters and podcasts that disclaim, "nothing you read in these pages constitutes investment advice, even the investment advice," and despite that RobinHood "Snacks" has ushered in a new era of "broker-produced-blogs-not-research," (admittedly, they're not researched) I interpret that the ethics of my profession require me to call my content what it is, which is to say: I publish security recommendations, dated and timed to coincide with specific market events and meant to provide professional investors with actionable, diligently researched, and independently formulated ideas. Despite delays brought about by the novel coronavirus pandemic, the efforts of my attorneys and Virginia state regulators bore fruit early last month, and Antrim is now legally able to accept payment in exchange for my work. Prospective clients and subscribers can find Antrim's Form ADV part 2A and 2B "Brochure" as they sign up for my research (you're required to read it, actually, despite that it's boring) and linked in the footer of my website, next to the Privacy Policy disclosures.
In June, the broker research division of Refinitiv (formerly Thompson Reuters Financial & Risk division) approved Antrim Investment Research to distribute its work on the Refinitiv broker research platform, and on Friday, July 3rd, my coverage initiations for Michaels Companies (Nasdaq:MIK) and Despegar.com (NYSE:DESP) were published for subscribers to Refinitiv's research feed.
In June, I discovered that it was actually equally difficult to get Antrim set up with a merchant account and payment gateway so that I might accept credit card payments in exchange for research access for my subscribers. As it turns out, web-based subscription services with recurring credit card payments are considered the highest risk category of payments for payment processors, and Antrim's request for a new merchant account coincided with Fed Stress tests that indicated to a number of banks reviewing Antrim's application that they didn't have enough regulatory capital set aside to weather the ongoing economic impact of the coronavirus. Antrim's application for a merchant account was auto-denied by most.
It turns out that Stripe is an excellent solution for web-based start ups. Their prices are lower (at least in the high risk payments category I find myself in), they offer a useful dashboard for payments and subscriber analytics that's modern and intuitive, and their sales team and customer support people work on weekends. I learned all that because I needed them to get my application approved on the weekend of June 27-28, and the Stripe people came through. I've covered merchant acquirers in the past but I've never really seen the business from this angle. It was an illuminating process. But as a result, Antrim's payment gateway is live, as of the evening of June 30, and my subscription based equity research product is now LIVE, for $100/month, or an annual subscription of $1,000/year.
Currently, Antrim finds itself in something of a "soft launch" mode - currently accepting payment from subscribers, but also still in process of building out my coverage universe. Initiations on long positions: Michaels and Despegar have already been published. Initiations on Cabot Oil & Gas, AGNC Investment Corp., Annaly Capital Management, PNC Financial Services, and Lemonade Inc. are in process. Initiations of short positions in Kinsale Capital Group, Skyworks Solutions, Transdigm Group, Tesla, GSX, Restaurant Brands International, Micron, and Lancaster Colony are in process. I hope to publish many, or all, of those initiations for subscribers over the coming months.
So too are changes coming for the monthly newsletter, Idiosyncratic Risk. While it still comes out on the first of every month, and it's still offered for free, I do plan to start charging for Idiosyncratic Risk subscriptions. At some point in the fall/winter, IR will become a subscription based newsletter, offered at the price of $20/month or $200/year. Ultimately, the "Antrim Vision" is to provide, for $1,200 annually, a compelling investment newsletter PLUS ongoing institutional coverage of the ideas contained within its pages. Antrim seeks to differentiate its coverage by focusing on special situations and short idea generation, and all for less than the annual cost of a subscription to Grant's. (Don't cancel Grant's though, they're great, too.)
This post is intended to be somewhat of an announcement to my readers about where we are and where we're going. Also a bit of a celebration of what I've accomplished with Antrim over the past weeks and months. But it's also a reminder that I'm going to be very busy over the next few months, and that there's a lot of wood left to chop. For those of you that are interested, sign up on the equity research tab. For those of you who are curious, get in touch! I can be reached by email at ejensen@antrimresearch.com and I'm happy to talk stocks, talk Antrim, or just make new friends.
The first six months of 2020 have been interesting, to say the least. I'm an optimist at heart, and I'm excited, despite it all, for what the next six months could bring. If you've made it this far, thanks. If you're still here for radical common sense and thoughtful, independent stock analysis, like, share and subscribe!
