Recommending a stock that might be more resistant to the downside of the economy

As we all know, the market this year has been in a downward spiral due to many reasons, the biggest of course being the Feds who are quick to flood market with money but slow to react to inflation.

Anyhow, clearly market is not a very safe place for your money. Bonds are still considered as bad as cash by many. Precious metals are falling due to $ strength and commodity bubble leaking (due to slowing economy). Don't get me started on Cryptos/NFTs.

Personally I'm still in the market for two opportunities.

One, is short term bounces. I don't short stocks any more – not good at it, made a rule and resisted temptation this year, even though I predicted quite accurately this bear market – only missed the peak by a bit over a month – I predicted in late Sept. that Nasdaq peak was 15400 on Sept. 7. That was wrong and I pulled out of market earlier than I should – still, it was 28% better than the current Nasdaq level. I've since caught a total of 5 TQQQ bounces since Feb. 2021 with 0 mistake. Can't say I'd continue to be error-free but one could earn some money in a bear market being a long.

Two: is LKNCY. Yes, it's a Chinese stock and had a fraud two years ago. If you have a principle not investing in either case, then no need to read further. If not, it's still an attractive opportunity in this market because:

1. It's a Chinese stock. Chinese economy is bucking the trend of Europe and America, who are both grappling with unusually high inflation and economy feeling pressure from the tightening monetary policies. Chinese economy, however, is in fact benefiting from a quite low inflation rate and stimulatory policies this year to try to expand at 5.5% annual rate (might not get there but things looked a lot better than when Shanghai was locked down).
2. Geopolitical pressure on Chinese stocks are getting some reliefs. Due to economical issues, our government is now more willing to work with the Chinese government – for example, finally undoing some parts of the trade war. There also did not seem to be issues as a result of the Russia-Ukraine war.
3. Luckin Coffee is a great combination of value and growth stock. It has its unique risks, but its advantages significantly outweigh the risks, particularly given the level of different risks that other stocks are all facing now too. I do not want to repeat everything I've said in my previous post about Luckin, please read that post on all the detailed risks and discussion, as well as how Luckin should be valued at. Since I posted here about LKNCY 48 days ago, it rose 47% in just 11 days, and now up 80% since then (comparatively Nasdaq is up a paltry 2.6% since then). I will instead focus this post on what has changed since that post.
4. What has changed for LKNCY since my last post:
   1. It's much more expensive now. At $14.86, its TTM PS is now 3.6 instead of 2.0. Meanwhile Starbucks is at 2.9, Dutch Bros is at 10.9. Luckin is growing about as fast as BROS, and turning profitable (BROS turned slightly unprofitable due to expansion/cost), but due to it being Chinese stock with unique risks, it can't demand the same PS. But given it's only 1/3 of the PS of BROS, it's still a bit undervalued (but not as undervalued as when it was almost just 1/5 of BROS's PS 1.5 months ago when I alerted this board for the first time ever – previously I only shared on Luckin's own board). As a result, I would suggest wait for a pullback before getting into Luckin – if you're interested – or DCA in, not in one batch for sure.
   2. The audit issue (HFCAA being handled by PCAOB and Chinese equivalent of SEC) is still not resolved. Previously we had expected to have some result by end of June. It already passed. This is somewhat an increased risk given the time urgency.
   3. Luckin has some executives registered to sell 1/20-1/6 of their stocks granted in 2021 in the next 60 days or so. This usually is not a good thing but given the size isn't outrageous and the stock price kept rising after this news came out, plus there're speculation that they're only registered to sell because they anticipate good news, it's hard to judge if this is good or bad. It could also be opportunity, but definitely has some risk associated.
   4. Overall, I still maintain that Luckin Coffee has a good chance to get to $20 this year – as long as the market doesn't just crash and drop another 20% very soon. When the market crumbles, nothing is spared. I feel Luckin is more resistant to the downside of this market, but its resistance has a limit too. No good stocks goes unpunished if we see another 20%+ market drop. However, Luckin should do better than most other stocks.

Once again, please read my previous post for more detailed discussion on Luckin.

To those “detectives” that criticized me in previous post's comments as being an LKNCY pumper because I only ever recommended this one stock on Reddit:

I actually created this Reddit account in Feb. 2021 to post about LKNCY because I felt it was very undervalued at that time and it was a great entry point (I held it since May 2020 in fact and added positions along the way as its risks diminished and business boomed). Since then, I only shared my tremendous research on the stock with fellow shareholders at r/LuckinCoffee, where people know me as knowledgeable and honest. I point out things I like and dislike, I back opinions with facts/data or logic.

Moreover, I only recommended and posted about LKNCY since Feb. 2021 because I was convinced even back then, that in a sea of overvalued stocks, Luckin stood out as (among) the most undervalued and promising as my research suggested. All other stocks are either overvalued or risky bets in a frothy market – and yes, Feb. 2021 was already a frothy market.

And I was right. All high fliers fell this year – wiping out all the gains and more since I posted on Reddit in Feb. 2021 – including even all the tech leaders. LKNCY was up 56% YTD and more since Feb. 2021. So why should I recommend other stocks when I was convinced that LKNCY was the value/growth stock people should buy, not the other overvalued stocks (and I was right)? Had I recommended any other stock to you, you would've been losing money on it now!