ENVX update

Update. Its been a busy couple of weeks for ENVX. New order from the DoD. Another short hit piece. Earnings.

The long and the short of it is that ENVX is, in my opinion, about to enter a phase of growth and news announcements that I believe will make it likely we won't see below $15 share price again.

Summary of Earnings Call ENVX management did perhaps one of the fines calls I have ever seen a company do. They literally answered every concern that investors, analysts and idiot shorts have.

First, they toured the Fab and showed the equipment.

Second, they reiterated that the DoD contract is a starter contract - totally normal before a larger order comes.

Third, they confirmed the revenue number for the rest of 2023 - which also means more positive news announcements coming.

Fourth, they named three cell phone companies that they are working with.

"I am happy to share that Enovix has established engagements for smartphones with leading OEMs Xiaomi, Vivo, and Lenovo."

Fifth, they lowered their CAPEX from 120m to 70m - this is a huge deal.

ENVX is at the stage with possible customers where they are working with each company on specific design and manufacturing issues. This is really exciting. ENVX also is ahead of schedule with getting Fab2 up and running AND they announced a financing deal with YSB out of India.

I heard, and I want to be clear, NOTHING negative on the call.

Reading Between the Lines While they were not able to disclose who else they are working with they did offer hints and clues. This is what I heard:

1. They have so much opportunity coming at them that they are being choosy what to pursue.

2. They are working with a company that offers all three device types: laptops, phones and wearables. There are only three companies that do so: Apple, Samsung and Google (thanks to JustJake for pointing out Google). ONE OF THESE COMPANIES AT LEAST IS DOING THE DESIGN AND PRODUCTION TESTING NOW.

3. The DoD contract could/should/will be sized UP.

4. They will have much more news to release the second half of 2023.

5. The first consumer devices using their battery tech will be released by year end.

I know I am missing many other positives but at the end of the day, it was an excellent call.

The Shorts

There is a 34% short position. And they have been getting hammered. The latest report was short (haha) on facts and long on bullshit. But the Chairman, who also owns almost HALF A BILLION $s of stock did not issue some mealy mouth statement. He took his gloves off and absolutely obliterated the short thesis. Read it here: https://ir.enovix.com/static-files/a437bb2d-0068-402e-b528-4ebfd8443005

Then the "source," a former employee, "clarified" his statements:

The bottom line is that the short thesis was dismantled. Again. But they are not just going to give up. They will keep writing hit pieces and when they do, it could provide temporary opportunities to add.

The Analysts:

The Plan: While I already own shorter duration options AND LEAPs, if I did not, my plan would be the same. I plan on buying:

• Oct 2023 24C

• Jan 2024 30C

• July 2024 40C

• Jan 2025 40C

I also will be adding each month to 2 month out shorter duration options on any pullbacks. Timing on the LEAPs is as follows for me:

• Oct 2023 24C-now at 1.70 and adding today

• Jan 2024 30C - now at $2.10 and adding today

• July 2024 40C- now at $3.10 and waiting for a pullback

• Jan 2025 40C- now at $4.50 and waiting for a pullback

As for the shorter durations, I will add the Oct 26C (now at 1.30) on a pullback AND on spikes, sell half. Then buy back on a pullback and repeat.

I will not be trading the July 2024 or January 2025 LEAPs. I will trade the January 2024 LEAPs on spikes and dips.

I believe more today that ENVX has the potential to be one of those rare investments that can be a life changing position. There ARE RISKS. They could fail in their scale up of production. Someone could come out with superior tech. The entire market could crash and drag them down with it. This is not a guaranteed investment, none are. But in my experience, this is a rare opportunity. I have said it before and I repeat it: the possibility to make FU money is excellent.

My conviction is so positive that I am building to where this is 1/3 of my total. BUT - along the way I will be pealing off profits and waiting to reload. I want to get paid to hold.

Price weakness on a daily basis will NOT concern me because as management stated, the second half of 2023 will be heavy with news releases.

As always, I offer the above to clarify what I am doing and am in no way recommending anyone else do this. BUT - I always hear about people wishing they could've gotten into Apple or TSLA at the beginning. I honestly believe that the chances are high that people will say the same thing about ENVX.

And the $50m question: how high do I think this could go? By the end of 2023, I think 35-40 is realistic. Beyond that? I have no idea the timing but I DO agree with Loop Capital's price projection above. At a minimum.

theBoss