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Note 62: Breaking in 2023 on the right footing
I hope all of you had a good New Year’s celebration. Due to my wife heading back to her hometown to attend the funeral of a friend’s father, and me staying in Chicago to hold down the fort (and make up for lost time due to December’s COVID infection), I ended up on the couch on the evening of New Year’s Eve. (A friend did invite me to accompany her on her plans, but I decided not to.) I surfed the streaming services for a decent movie to watch to pass the time until I got tired, and I landed (back) on 1995’s Strange Days:
For mid-’90s science fiction, the film has aged extremely well and is more a detective noir story than it is a sci-fi rollercoaster.
Given that I’ve owned this film on DVD forever, I assumed that I’d be able to stream a version of it somewhere, but it was nowhere to be found. Furthermore, it doesn’t seem that the film was ever released in the United States on Blu-ray. I did a bit of digging, which took me down the rabbit hole of unwatchable films. Apparently, there’s an entire movie ghetto of films that never made the jump to high-definition distribution because of licensing issues, a lack of interest from the studios that own them, and current events causing issues for past releases, as is currently the case with Kevin Smith’s Dogma:
I’ve been aware of the Dogma issue for some time, but was surprised to discover that Strange Days was stuck in a similar limbo. (One theory speculates that the updated Strange Days releases are a casualty of the divorce between Kathryn Bigelow and James Cameron.)
After I watched the film and went to bed, I woke up ready to get the new year off on a good footing. Due to my November New Mexico trip and catching COVID mid-December, I was limping through to the end of 2022 with my holiday plans a smoking crater (including a planned trip to Iowa for Christmas) and a pile of billable work that I needed to get done with COVID-induced fatigue and a lingering head cold.
Leading up to the New Year, I did what work I could focus on, and when my brain wasn’t working, I attacked housecleaning and organization with gusto. I played a ton of World of Warcraft, having reactivated my subscription when I got back as a treat. I spent the last week of 2022 as a “Let’s Overdo Everything So I’m Sick Of It Next Week” event. Think of it as a Purge for bad habits and unhelpful indulgences.
I woke up on January 1st with a good idea of how I wanted the next year to unfold and I’ve been dialing some stuff back (time spent on Discord and Reddit, sleeping on the couch after streaming a movie), while bringing some new stuff back into my daily routine (reading before bed, wearing pajamas instead of basketball shorts, the Remember the Milk app and GTD). I didn’t make any formal resolutions other than to work on doing what I do better. After failing to insert music into my life last year, I figure that I have plenty going on, and I’d rather get better and more competent at all of that instead of trying to be all things to all people.
Before Apple dropped the ball with Mac OS development, during the Golden Age of the Late Aughts, the company had an interesting approach to releasing new versions of their operating systems annually. Odd-numbered releases (10.5 Leopard, 10.7 Lion) would be “feature” releases where the company would throw in lots of new features and doo-dads. The even-numbered releases (10.6 Snow Leopard, 10.8 Mountain Lion) would be stability and performance releases where Apple would fix the bugs that they introduced with the new features in the last release and tune the performance of things so everything ran as originally envisioned. 2023 is going to be one of those bugfix and performance tuning years for me.
Rocket stock check-in
In late 2021, I was high on rocket fuel fumes and all-in with rocket and space stocks. The Moon was the limit, and there was big money to be made.
Folks who paid attention to 2022 are aware that’s not how that story played out. When the Fed began raising interest rates (a move that I wholly support), that took a hammer to the valuations of stocks in general, and ground early technology stocks to dust. I’m still bullish on the sector (which has always been a one- to two-decade play for me), but it wasn’t pleasant watching all the 2021 (and early 2022) retirement dollars I shoveled into the sector blow up like so many of Astra’s rockets.
Let’s look at some valuations in the companies that I hold:
Astra Space (ASTR): A year ago, Astra was trading $6.95 per share and last traded at $0.4394 per share. In addition to the strong headwinds from the Fed interest rate hikes, it took a massive hit when it failed to launch NASA’s TROPICS payload, and the company threw in the towel on its Rocket 3, in favor of going back to the drawing board with Rocket 4. I’m bearish that the company survives long enough to get Rocket 4 off the launchpad (esp. since it will be targeting a crowded market already being served now), but the bright spot for me remains its Astra Spacecraft Engine (neé Apollo Constellation Engine), which I hope Rocket Lab’s Space Systems has the good sense to pick up when Astra finally implodes.
Virgin Orbit (VORB): VORB was trading around $6.83 a share at the beginning of 2022, with a jump pre-rate hike up to $11.28 in January, until sliding down to a price of $1.76 per share now. The biggest issue that this company is facing are delays - its platform works, but the company has been unable to establish the launch cadence needed to support a “send a lot of small rockets up frequently” business model.
Rocket Lab (RKLB): Unlike the two companies above, Rocket Lab has been executing pretty well in 2022, but wasn’t immune from getting hammered in the flight from stocks. It closed 2021 at a price of $12.47 per share and is currently trading at $3.62 per share.
From a technology perspective, it had a banner year:
Rocket Lab solar tech literally powers the James Webb Space Telescope.
The company sent a lunar orbital payload to the Moon as part of the CAPSTONE mission.
It set up a new launch site in the United States, making it eligible for national security payloads.
It almost realized its reusability ambitions when it came close to successfully retrieving a falling rocket with a helicopter.
It completed 9 launches in 2022 with a 100% success rate.
Neutron development is proceeding nicely.
In addition to running a successful launch enterprise, its satellite supply business (Space Systems) brought in significant revenue and will remain a key part of the company’s overall picture. (I hope Astra’s Spacecraft Engine ends up here, when Astra finally closes shop.)
Unfortunately, all of that was not enough to keep the shares from shrinking 71% during 2022.
Planet Labs (PL): Planet Labs opened 2022 at $6.00 per share and ended the year around $4.38 per share. Now, this isn’t a rocket company, but a satellite photography company that demonstrated its value during Russia’s invasion of Ukraine. I expect that its value would have been more depressed in 2022, if not for the role it’s playing in the ongoing war.
Overall, 2022 was an unmitigated disaster for my space portfolio.
I’ve mentally written off my full Astra investment, and I’m skeptical that the company will last long enough to field a competitor to rockets that Space X and Rocket Lab are flying now. Astra failing as often as it did in 2022 leaves it with a significant hill to climb to get back to a place where companies and governments will trust it with their payloads again.
I’m less bearish on Virgin Orbit - as they’re not losing customer payloads - but their largest challenge will be getting to a frequent launch cadence that makes the money math work for their business. I don’t plan on buying more of the company than my current token amount, but I also expect VORB to still be an active stock ticker in two years’ time, as opposed to ASTR.
As for Rocket Lab, I don’t think that the company’s current valuation reflects the competence and execution we saw in 2022. I’m not mourning the low stock price yet - I’ve been using it as an opportunity to grow my position in the company while significantly lowering my average cost basis. I don’t know if it’s a stock that I would recommend others purchase (for that matter, there may be no stocks that I would recommend today), but I’m still a believer in it and am purchasing accordingly (as client checks permit).
I’m pleasantly surprised that Planet Labs ended up being the winner of the “who lost the least” contest and look forward to it bouncing even further as soon as market conditions will permit. I’m considering expanding my position in this company as well, especially given that there are not a lot of other companies currently inspiring much confidence at the moment.
I read a pitiful 15 books last year (according to Goodreads), and one of my odd-year routines is finishing 100 books in a calendar year. I’ve gotten off to a good start with this year’s goal (already 2% done):
The Private Life Of H.P. Lovecraft by Sonia H. Davis (★★★★★): This is a short memoir originally published by Hippocampus Press in 1985 that reproduces the complete version of the account of weird fiction author H.P. Lovecraft’s wife during the period in the mid-1920s when the couple was wed. It was an honest, yet charming, account of Lovecraft as a husband (and goes about as well as one would expect, if you knew the fellow and his family). This was a nice appetizer for Two Hearts That Beat as One, a Kickstarter-funded full biography of Sonia Davis landing later this year.
Ghostbusters: Tobin's Spirit Guide by Eric Burnham and Kyle Hotz (★★★★☆): A fun bestiary of spirits, demons, and demigods from the world of Ghostbuster films, comics, and the venerable ‘80s cartoon. Should be a part of every cosplaying Ghostbuster’s outfit moving forward.
In terms of my overall goal, I start out two books ahead of schedule (2 of 100).
CMDRs, I have to confess that I’ve been AWOL from the Thargoid invasion thus far. I allowed myself to get sidetracked by the latest World of Warcraft expansion and spent more time flying dragons than flying spaceships these past several weeks. On New Year’s Eve, I wrapped up my time there and posted a few photos before sending my Night Elf Druid back to the Emerald Dream:
With that distraction out of the way, I look forward to joining the conflict as soon as my civilian life permits.
 For folks unfamiliar with the NES Ninja Turtles game, this video goes into exacting detail why the swimming level above was such a nightmare. Turns out that it wasn’t actually players’ fault!