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February 16, 2023

NerdWallet (NRDS): Sell A Quarter and Hold the Rest

NerdWallet (NRDS) soared 26% yesterday and was up as much as 10% more this morning (+6% as of 11:45 a.m. ET). This is a fantastic result and has pushed our paper gain up to almost 70% and validated doubling down back in January when the stock looked like garbage. That all said, NRDS is now ripe for profit taking so let’s sell a quarter of our position and hold the rest. The earnings report was fantastic and I think there is still upside over the coming quarters. But there could easily be some turbulence in the interim. This is simply a risk management strategy to lock in gains while we have them. Hopefully selling a quarter for about a 70% gain is a mistake. SELL A QUARTER, HOLD REST

Tyler Laundon is chief analyst of the limited-subscription advisory, Cabot Small-Cap Confidential and grand slam advisory Cabot Early Opportunities. He has spent his entire career managing, consulting and analyzing start-up and small-cap companies. His hands-on experience has taught Tyler that the development of a superior business model is the biggest factor in determining a company’s long-term success. Accordingly, his research focuses on assessing the viability of management’s growth strategies, trends in addressable markets and achievement of major developmental milestones.