Become a logicalchat Member

Latest Post

Your story starts here. Sign up and let's connect in ways that truly matter!

HomeLatest NewsWeekly newsStock recap and outlook for the week ahead 21-25 Aug

Stock recap and outlook for the week ahead 21-25 Aug

Stock recap

WEEKLY STOCKS RECAP

IN TECH

Rising price targets boost Nvidia 

Oppenheimer analysts raised Nvidia’s (NASDAQ:NVDA) price target to $500 this week ahead of earnings on Wednesday, stating that the company “remains the purest scale play on AI adoption.” Rosenblatt raised Nvidia’s price objective to $800 per share, a Street high.  

Rosenblatt analysts said investor expectations for fiscal 2025 (calendar year 2024) earnings per share “have risen substantially, but we recommend investors stay the course here and remain bullish amid the recent pullback in the stock over the past month.”  

The analysts said, “NVDA’s long-term AI revenue opportunity will depend on demand, but supply should drive data center revenue through C2024.”  

Analysts expect $2.07 per share second-quarter earnings on $11.17 billion in revenue. The Street expects $2.35 EPS on $12.49B revenue this quarter. 

Shares climbed 7% weekly to $432.99. 

Even after a weak sales projection, Cisco Systems climbs on management optimism. 

Cisco (NASDAQ:CSCO) reported poor full-year sales guidance on Thursday, but it beat Wall Street targets for the fiscal fourth quarter and the stock rose on management optimism in AI.  

The business reported adjusted profits per share of $1.14, $0.08 more than expected, on revenue of $15.2B, above the $15.05B average projection, driven by enterprise demand for AI, security, and cloud.  

Q1 earnings outlook of $1.02 to $1.04 per share beat expectations of $0.99, and revenue of $14.5B to $14.7B met targets. For the full year, analysts expected $4.04 per share on $58.4B in revenue and $4.01 to $4.08 per share on $57B to $58.2B in sales. 

Management boosted the shares after disappointing revenue guidance by highlighting the company’s future prospects in various areas, including AI. 

On the earnings call, CEO Chuck Robbins said Cisco is poised for “further share gains” in campus switching, wireless LAN, and SP routing, having gained “over 3 percentage points of market share” in those key areas, and that the company is “super well positioned” on AI. 

Following these findings, BofA, Citi, and KeyBanc analysts maintained neutral ratings on the stock. 

BofA and KeyBanc praised the company’s execution and innovation, but BofA sees “additional risk to estimates” due to a “diminishing backlog contribution” that would require a “significant order recovery throughout F24, which might not materialize.” KeyBanc is neutral until “more consistent signs of share gains and improved visibility into F2H24 order growth ramp.” 

Citi said it is waiting for additional market share increases in “switch and security,” adding that Cisco’s AI discourse was “encouraging,” but “we await third party data verification to get more excited about share gains.” 

Evercore maintained its Outperform rating on Cisco and boosted the target price by $3 to $63, calling the fiscal 2024 estimate “fairly conservative with room for upside” across various divisions. It also believes “showing operating leverage,” and a more constant $1.5B quarterly share buyback, “will resonate with investors and provide higher predictability for CSCO shareholders going forward.” 

Cisco rose 2.3% to $55.04 this week. 

Tesla slashes Chinese prices, raising fears 

Last week, Tesla (NASDAQ:TSLA) lowered prices on its vehicles in China, raising concerns about a pricing war in the lucrative electric vehicle (EV) industry. 

Elon Musk’s EV company cut pricing for its Model Y long-range and performance versions in China by CNY 14,000 on Monday, raising concerns that its competitors in the world’s largest car market will follow suit. 

It cut the price of its Model X SUVs and Model S sedans in inventory by up to CNY 70,000 (CNY 1 = $0.1371) two days later, according to its WeChat account. 

Tesla is striving to capture the fiercely competitive Chinese market. The company’s July shipments fell 31% to their lowest level this year, and global production is likely to tumble in the third quarter. 

Musk argued last month that Tesla should “sacrifice margins to make more vehicles,” saying that its Full Self-Driving mode will increase automobile value. 

In a research note, Evercore ISI analysts projected targeted pricing reductions in the U.S. and Europe. 

On Thursday, Morgan Stanley noted “Investors are becoming more cautious on China EVs after a solid run in the past 3 months, with Tesla’s further promotional activity of particular concern.” 

Weekly shares fell 8.5% to $215.49. 

Critical regulatory obstacle cleared for Coinbase 

Coinbase (NASDAQ:COIN) announced Wednesday that it has received NFA approval to operate as a Futures Commission Merchant. 

This “critical milestone,” according to Coinbase, allows US users to access cryptocurrency futures on its platforms. 

Coinbase applied to the NFA for FCM registration in September 2021. Nearly two years later, officials approved the company. 

After the announcement, shares rose, but they fell 8.5% to $73.19. 

IN EV SPACE

 

VinFast debuts 

This week, Vietnamese electric-vehicle maker VinFast (NASDAQ:VFS) debuted on the U.S. stock exchange and surged 270% to $37 before plummeting.  

After merging with special-purpose acquisition business Black Spade, the shares traded at $22, valuing the corporation at $50 billion, more than double the $10 per share, or $23 billion, agreed to with Black Spade. The move raised VinFast’s market cap to $85 billion, surpassing Volkswagen (OTC:VWAGY) (ETR:VOWG_p) and Ford (NYSE: NYSE:F), which are worth $69.7 billion and $48 billion, respectively.  

The stock has fallen 45% since its peak. Even at its lower valuation, VinFast had the largest market capitalization of any Vietnamese firm trading in the U.S.  

Vietnamese carmaker VinFast is famous for its bestsellers. However, since starting deliveries in the U.S. early this year, the automaker has struggled to gain favor.  

VinFast’s VF 8 electric SUV has received poor press in recent months when U.S. reporters tested it. 

Road & Track deemed the vehicle “simply unacceptable.” Another MotorTrend said, “Return to sender.”  

VinFast said it improved software based on comments “from vehicle owners and the automotive reviewer community” in a blog post this week. It remains to be seen if these reforms can affect popular opinion.  

Shares ended the week at $15.40. 

Tesla keeps lowering pricing 

This week, Tesla (NASDAQ:TSLA) lowered the price of its Model Y long-range and performance variants in China. The company stated that it would offer insurance incentives to buyers of its entry-level, rear-wheel-drive Model 3 through September.  

Tesla sales in China fell 31% in July, the first drop since December. The corporation has been offering deeper discounts in and out of China since late last year to maintain its market leadership.  

Last month, CEO Elon Musk implied in an analyst call that the business would keep slashing prices even if it erased profit margins, saying that Full-Self Driving will improve automobile value. 

Mullen rides delisting lines 

This week, emerging EV producer Mullen (NASDAQ:MULN) announced a $25 million stock buyback scheme to buy 3.7M common stock by year’s end.  

The initiative shows the company’s commitment to Nasdaq trading standards.  

A company’s per-share price must surpass $1, under the guidelines. If a firm misses the minimum for 10 trading days, it may be delisted.  

Last recently, Mullen reversed its stock split 9:1, raising its price from $0.11 to well over $1. However, the manufacturer has struggled to sustain that price, falling below it and putting itself at jeopardy again. 

“We believe our stock is undervalued,” CEO David Michery stated. “The Company has begun production of our Class 3 EV with customer deliveries pending and a strong balance sheet allowing us to execute our business plan.” 

Weekly shares closed at $0.64. 

Outlook for the week on energy and precious metals

WTI Price Outlook 

Sunil Kumar Dixit, chief technical strategist at SKCharting.com, predicted WTI will face resistance near $85.60 this week.  

After that, the monthly Middle Bollinger Band of $86.80 will rise.  

“This $85.60-$86.80 resistance zone is critical as it holds the key to further price action and trend continuation or reversal,” Dixit said.  

He stated a break below the 50-week EMA of $78.95 could extend WTI’s slide to the 50 Day EMA of $77.60, the 200-day SMA of $76.10, and the weekly Middle Bollinger Band of $75.55.  

Stability above the daily Middle Bollinger Band of $81.20 will keep the short-term bias positive, with an upward trend towards retesting the swing high of $84.90 and greater resistance at the 100-week SMA of $85.60 and the monthly Middle Bollinger Band of $86.80, Dixit said. 

GOLD: Price Forecast  

Dixit of SKCharting said gold remains under adverse pressure as the Dollar Index rises to 103.58 and raises concerns that it could reach 104.60 next.  

That may push gold to $1,850, he said.“The Dollar Index needs to break below 103 and 102.60, followed by 101.60, for gold’s uptrend to resume,” Dixit said.  

As long as spot gold stays below the 5-day EMA of $1896, a break below $1,885 is likely, opening the door for a further slide to $1,878-$1,868. If weakness persists, the monthly Middle Bollinger Band of $1,850 and the 100-week SMA of $1,1846, will challenge important downside support.  

Dixit advised clearing the 200-day SMA of $1,907 after recovering above the 5-Day EMA of $1,896 for a rebound.  

If spot gold breaks the $1,929-$1,935-$1,940 resistance zone, a short-term bullish wave will form.  

Dixit noted that the weekly Middle Bollinger Band of $1,959 and the 100-day SMA $1,962 provide major upward resistance. 

Gas price outlook 

Dixit of SKCharting said natural gas prices are consolidating toward the 100-day SMA at $2.44.  

 He added a daily closure below the Middle Bollinger Band $2.67 maintains momentum under strain and must be recaptured for initial signs of an uptrend. A sustained break above this region will increase upside to $2.86 and the swing high to $3.01.  

Dixit stated the 200-day SMA of $3.24 and 50-week EMA of $3.53 are major upside objectives.  

He noted that a breach below the horizontal 100-day SMA of $2.44 will push gas to $2.25 and prolong its bearish run to $1.95. 

DEALS

ArcelorMittal exploring US Steel offer

ArcelorMittal (NYSE:MT), the world’s second-largest steelmaker, may acquire United States Steel (NYSE:X), according to Reuters. This comes after US Steel began evaluating acquisition offers.
People familiar with the situation said ArcelorMittal’s investment bankers are considering the suggestion but aren’t sure if they will proceed.
Esmark proposed $35 per share for US Steel earlier this week, which might start a bidding battle. Before that, US Steel rejected an unsolicited cash and stock deal from Cleveland-Cliffs (NYSE:CLF) for $17.50 in cash and 1.023 of its own shares each US Steel share. US Steel deemed the offer “unreasonable.”US Steel shares rose over 36% while ArcelorMittal fell 4%.
Tower Semiconductor’s acquisition by Intel ended.
On Wednesday, Tower Semiconductor (NASDAQ:TSEM) shares fell more than 10% after Intel (NASDAQ:INTC) confirmed that the companies had canceled their takeover proposal. Intel shares declined over 3% that day.
Last February 15, Intel proposed a $5.4 billion merger with Israel-based Tower Semiconductor. Intel claimed delays in regulatory approvals.Intel fell 5.6% weekly to $32.75.

Strategic growth with Bridge Media Networks boosts Arena Group shares.
Arena Group (NYSE:AREN) announced a strategic expansion with Bridge Media Networks with its Q2 earnings results, boosting its share price by almost 10% on Tuesday.
The company signed a binding merger agreement with Bridge Media Networks. Bridge Media Networks’ parent company Simplify Inventions will invest $50 million in cash in the combined entity, $25M in common stock and $25M in non-convertible preferred shares. A collection of Simplify-owned consumer companies will guarantee $60M in advertising for The Arena collection for five years.Arena shares rose over 30% this week.

Energy Transfer signs Crestwood Equity $7.1B transaction

Energy Transfer (NYSE:ET) bought Crestwood Equity (NYSE:CEQP) all-equity.Based on Crestwood’s closing price on August 15, 2023, the purchase is worth $7.1 billion, including $3.3B in debt.

Ball sells BAE Systems aerospace unit
On Thursday, Ball (NYSE:BALL), the world’s largest producer of circular aluminum packaging for beverage and home brands, announced that it will sell its aerospace business to BAE Systems (LON:BAES) for $5.6B in cash.

Insider trades & hedge funds weekly

Bloomin Brands’ 9.9% ownership is confirmed by tarboard Value LP.


hedging fund , Starboard Value LP announced a 9.9% interest (8,623,000 shares) in Bloomin Brands (NASDAQ:BLMN). At the end of the most recent quarter, which ended on June 30, 2023, the company had nil shares.
The Wall Street Journal had earlier that day reported that activist investor Starboard Value had strategically purchased a position more than 5% in the owner of the restaurant business.
These announcements caused Bloomin Brands shares to increase by more than 8% on Friday.

Three homebuilders were purchased in Q2 by Warren Buffett’s Berkshire Hathaway.

In its Q2 13F filing with the SEC, Berkshire Hathaway (NYSE:BRKb) noted the addition of new stakes in three homebuilders.
Currently, Berkshire owns 11,112 shares of NVR (NYSE:NVR), 152,572 shares of Lennar (NYSE:LEN), and 5,969,714 shares of DR Horton (NYSE:DHI).
Given the persistent difficulties homebuilders are experiencing as a result of increased borrowing rates, these new positions are receiving attention. The choice to purchase these stakes can represent a wager on the expectation of falling interest rates and a rebound in housing market momentum.

CEOs snapping up shares

Tom Schmitt, CEO of Forward Air (NASDAQ:FWRD), bought shares of the company for $1 million.

Michael Weiss, CEO and President of TG Therapeutics (NASDAQ:TGTX), bought 100,000 common shares for more than $1 million at $10.13. With the most recent transaction, Weiss now directly owns 12,073,021 shares.

Parick Holt, president and chief executive officer of Amarin (NASDAQ:AMRN), bought 300,000 common shares for a total cost of more than $300,000. His whole ownership position in the business is included in the transaction. After being named CEO in July, Holt consented to use personal funds to buy $300,000 worth of Amarin shares on the open market.

Big director purchases

Kenneth Chan Hsiang-Tze, a 10% owner of Funko (NASDAQ:FNKO), paid $5.3429–$5.4126 per share for 490,825 common shares, or around $2.6 million. Following the most recent purchases, Hsiang-Tze now owns 6,052,676 common shares altogether.

Michael Andrew Chambers, a director of Sarepta Therapeutics (NASDAQ:SRPT), bought 23,686 common shares at $108.05 each, for a total cost of approximately $2.5 million. Following the most recent acquisition, Chambers now directly owns 6,431 shares and 237,017 shares indirectly.

Weekly Earnings Calendar

Monday, August 21

  • Zoom Video Communications (ZM),  Nordson Corp. (NDSN),  Fabrinet (FN),  Qifu Technology Inc. (QFIN).

Tuesday, August 22

  • Lowe’s Companies (LOW),  Medtronic (MDT), Baidu (BIDU),  KE Holdings (BEKE),  Dick’s Sporting Goods (DKS),  Coty Inc. (COTY), BJ’s Wholesale Club (BJ),  Toll Brothers (TOL),  Macy’s (M),  Urban Outfitters (URBN),  La-Z-Boy Inc. (LZB).  

Wednesday, August 23

  • Nvidia (NVDA),  Analog Devices Inc. (ADI),  Snowflake Inc. (SNOW),  Autodesk Inc. (ADSK),  NetApp Inc. (NTAP),  Bath & Body Works (BBWI), Williams-Sonoma (WSM),  Advance Auto Parts (AAP),  Kohl’s Corp. (KSS),  Peloton Interactive (PTON),  Foot Locker Inc. (FL),  
  • Abercrombie & Fitch (ANF). 

Thursday, August 24

  • Intuit Inc. (INTU),  Royal Bank of Canada (RY),  Toronto Dominion Bank (TD),  Vmware Inc. (VMW),  NetEase Inc. (NTES),  Workday Inc. (WDAY),  Marvell Technology (MRVL),  Dollar Tree (DLTR), Ulta Beauty (ULTA),  Burlington Stores (BURL),  The Gap (GPS),  Nordstrom (JWN).

For Details

Stock recap Stock recap Stock recap Stock recap Stock recap Stock recap Stock Stock recap Stock recap Stock recap Stock recap Stock

Stock recap Stock recap Stock recap Stock recap Stock recap Stock recap Stock Stock recap Stock recap Stock recap Stock recap Stock

Stock recap Stock recap Stock recap Stock recap Stock recap Stock recap Stock Stock recap Stock recap Stock recap Stock recap Stock

Stock recap Stock recap Stock recap Stock recap Stock recap Stock recap Stock Stock recap Stock recap Stock recap Stock recap Stock

Related Post