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01.02.2023
Low Risk Purchases in the Bearish Market: Salesforce

Salesforce is a leader of the CRM systems segment. Its stocks are trading at 47% off their peaks. The company continues to post strong business growth despite being in the market for a long time. It has strong financials and abilities to reward its investors. The last quarter revenue reported by Salesforce rose by 14% year-on-year to $7.8 billion, while its operational margin grew by 290 basis points to 22.7%. This is quite impressive as the company suffered because the strong Dollar undermined its revenues outside the U.S. The company’s management has also approved a buy-back program for $1.7 billion.

Management estimates the company will increase its operational margin to 25% in the next couple of years and boost its revenues to $31 billion during this fiscal year, or by 17%. Salesforce announced the cut of 10% of its staff in order to increase profitability. This is quite a common strategy in the tech sector to keep business expansion going.

The company is also active in the M&A market. The last of its acquisitions is the Slack platform that has posted revenues up by 46% during the reporting quarter. Thus, investors may have a wide variety of outstanding products as they buy CRM stocks.

11.08.2022
Perspective Peers of Ethereum: Avalanche

Avalanche is ranked by Coinmarketcap at the 12th position by market cap with $7.8 billion, which is 4% less than Ethereum’s market cap. AVAX prices dropped by 82% of its peak values, allowing investors to buy it at early 2021 prices. Avalanche’s infrastructure consists of three logically isolated networks, each of these with their own processing, validators, and own set of rules.

This platform is often compared to the existing internet web infrastructure with core connection protocols like HTTP, surrounded by a huge number of networks to their apps. Avalanche allow for the creation of public and private systems as a blockchain or DAG (Directed Acyclic Graph) and for the use of different virtual machines for apps, including EVM engine (Ethereum Virtual Machine) that allows Enthereum network programs to be developed.

Avalanche includes C-chain to create smart contracts that are processed on an advanced EVM engine, P-Chain that coordinates validators that process transactions and also allows for the creation and management of new subnetworks, and X-Chain which is a directed acyclic graph regulating issuance and trade of cryptoassets. DAG systems record new transactions on top of the old ones, allowing for processing speed to be increased and for capacity substantially. It is quite different to other blockchains, where transactions are compiled in blocks in order to be processed.

The advantage of Avalanche is that it provides anyone with the opportunity to create his or her own isolated blockchain with its own set of parameters, including access to apps and the programming language with which it will work. Every subnetwork can process around 4,500 transactions per second compared to 14 processed by the Ethereum network.

28.12.2022
The Most Generous Corporates: Capital One

Capital One Financial corporation shares are trading at 50% off their peak prices. This has inspired the management of the company to deliver a massive buyback program bringing the buyback yield to 19.3%. Together with 2.7% dividend yield, this has made the company one of the most generous in the market. COF shares are in great demand among investors that are focused on value stocks, such as Oakmark Fund with more than $45 billion in assets under management.

The specialisation of Capital One is mostly credit cards, auto loans provided to substandard borrowers, or in other words, people with high credit risk profiles. This business is highly profitable, although it does bear high risks too. The company says it has a reliable risk assessment model in place to run the business. The lender generates not only higher margins compared to its peers, but overruns regulators’ requirements of capital adequacy with 13.6% vs required 6%. Considering these criteria, the company is in line with some of the largest banking institutions in the world, like JP Morgan with 14.1% and the Bank of America with 12.8%.

The company’s capital base, which is built on clients’ deposits, is enough to conduct high-margin lending. Such a model of cheap resources is not only profitable but it is also stable. Capital One has a margin of 10-15% on its tangible equity. The interest for the company’s services is unlikely to decline in the foreseeable future considering the current economic environment. So, COF shares could be selected for long term investments with the upside potential of 30-40% once the market starts recovering.

24.11.2022
Major Risks for Tech Giants: Apple

Apple stocks have had a very impressive performance amid a clearly bearish market while losing only 20% of their peak values. However, investors should be prepared for elevated turbulence in these stocks considering the situation in China.

China’s zero-tolerance policy to COVID-19 led to a massive exit of employees from Zhengzhou city plant amid fears over tightening curbs. Over 200,000 workers are rumoured to have left the plant. If this is true, the production of iPhone 14 Pro and iPhone 14 Pro Max would be very complicated with no clear outlook on when it could be resumed. The delivery delay shown on Apple’s website has already hit six weeks. Americans who ordered the brand new IPhone for Thanksgiving Day will only receive it for Christmas now. Meanwhile the last two months of the year are very valuable for any mass-market company in terms of holiday sales.

 

Apple is planning to move iPhone production to India. But that would require years. The company has already invested $75 billion in the Chinese market and now this investment may be at risk as the ruling Communist party in China may put a local ban on the sale of Apple products. China is the third largest market for Apple with the United States at the first place with $153 billion and Europe at the second with $95 billion. Wall Street is expecting Apple’s earning to go up by five percent over the next three years. So, any troubles with production in China may alter these forecasts. 

28.12.2022
The Most Generous Corporates: eBay

eBay stocks are trading 50% off their peak prices despite significant progress in key businesses that increase the possibility of an increasing turnover of the auction platform. The dividend yield of the company is at 2.2%, while its buyback yield is at an impressive 24.4%. So, the overall reward for investors is at 26.6% in 2022, a record among public corporates. eBay has bought back shares for $5.3 billion during the last four quarters. So, outstanding shares have been reduced to 551 million from 685 million a year ago.

The company is actively developing collectable trading, including an acquisition of TCGplayer, a marketplace where enthusiasts exchange their collectables like Pokemon, Magic: The Gathering and others. The most important service that the platform provides is guaranteed authenticity of the collectables that ensures the buyers will not be subject to scams and also protect sellers from any malicious fraud. eBay has recently made this service available for jewellery above $500.

The company has published strong forward guidance for Q4 2022 with turnover at $17.8 billion, revenues at $2.46 billion, and EPS at $1.06. The EPS in the Q4 2021 was at $1.05. So, considering the tense situation in the retail market this year, any figures above record values of 2021 should be considered an achievement. eBay stocks will be able to recover rapidly to their peak prices once the market reverses to the upside, and that would mean 100% profit from the current values.

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A Situational Trading Strategy in Estee Lauder

I am not a big expert in cosmetics businesses. However, today's strong momentum in Estee Lauder (EL) stock made me excited enough to try an old and simple but usually effective trading technique with this particular asset. Estee Lauder added about 6% to its market value in only one trading session and managed to hold initial gains after the company's management announced changing tack for one of its popular brands, which is Clinique, so that it can be sold via Amazon's Premium Beauty store. Of course, large capacities of Amazon may allow every company to enhance sales. Honestly, I have no idea if it will work well in this case or not, but I see a very good chance of riding an upside move to test the nearest $160-165 resistance area for the stock. I speak about this from a purely technical point of view of a more or less experienced trader, who knows that putting a zero size stop-loss on today's entry point after two or three days of accelerating upside move is one of the ways to catch a potentially much bigger trend. Otherwise, nobody would hold me from simply cutting small losses for this kind of a situational trading strategy.

Clinique line-up is the first Estée Lauder brand to be launched on Amazon, and it is a major decision for the company who has long been reluctant to recognize any mass merchant retailer, including Sephora, etc. Estee Lauder believes it should cater to the department store customer. This change sounds interesting enough for paying a moderate attention to the company. Clinique is also known as a brand, which designed a popular skin analysis tool in the form of an interactive questionnaire to custom fit a skin care regimen, which will be offered on Amazon now as well.

Being a male I can rely on my girlfriend's judgement who just told me that is an exciting thing to try. So, let me partially agree with this beauty mind's estimation when taking at least one of my trading decisions. So, we will see where these consideration will lead my investments within a week or so.

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Stocks to Jump before Easter Break: RH

RH (formerly Restoration Hardware Holdings), a 40 years old California-based home-furnishings company, delivered a sweet surprise to its shareholders before this long Easter weekend, by gaining more than 15% after the opening bell on March 28. In fact, its market value soared due to literally "exceptional" demand outlook for the company's latest catalogue of products. Unlike Home Depot, RH is focused on home improvement offerings at higher price categories. Its source books strategy was designed to move past the four walls of the internet, making a shopping process more exciting. Analysts’ consensus 12-month price target was established somewhere below $320 per share before the news, yet all previous estimates messed up in a rather confusing manner, as even the current levels of nearly $345 per share does not look like a proper stopping point or ultimate goal. Q4 2023 financial indications for RH were below average expectations, but mostly because of accumulated shipping delays in the Red Sea and in the conditions of adverse weather in some cases, the company's CEOs detailed. Gross margin pressure was big enough as increased markdowns contributed a lot, yet signs of positive change are here, they said, feeling initial response to RH Outdoor collection with high chances for even growing demand in the first quarter. In particular, the management projected a "mid-single-digit" percentage increase. The company's management also hopes a period of additionally growing demand may extend to the whole year taking into account doubling the distribution of RH sourcebooks on enhanced brand-building initiatives by the marketing branch.

At least, another technical test of a $400 resistance, which was previously spotted in August 2023, seems to be a baseline scenario for the stock. The risk/reward profile also becomes better due to an upside momentum for the company against a broader uncertainty in the housing environment. The particular brand's market positioning may take advantage of the situation. RH has about $6 billion of market caps, more than 35 outlet stores in North America, operating nearly 100 galleries, including a full-line design type and baby-and-child points. One of the most attractive RH locations is in the former Museum of Natural History building, Boston. A big part of RH production is made outside the US, particularly from contract manufacturers in southern China, and it is also the largest importer of Belgian Linen and Italian bedding in the US.

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Rafael Quintana Martinez
Money Manager de alto rendimiento, con una sólida formación académica, profesional y de campo. Más de 9 años de experiencia especializada en el comercio de mercados financieros internacionales. La devoción, la fiabilidad, la responsabilidad y la ética impulsan mi vida. Actualmente me desempeño como Analista Senior para Metadoro. https://metadoro.com/es https://mx.investing.com/members/contributors/235587671/ https://es.tradingview.com/chart/EURUSD/rE9gVips/
Fantom is Likely to Go Down

Fantom (FTM) has experienced a notable decline of 4.9% this week, with prices sliding to $1.0240. This downturn marks a stark reversal from the impressive 14.0% gains observed on Monday, when the token surged to $1.2242. The recent pullback can be attributed to technical overbought conditions, as FTM emerged as one of the top-performing tokens in March with a remarkable surge of 163.0%, outpacing Bitcoin's 20% increase during the same period.

The surge in FTM's performance was largely fueled by a significant network update, known as Sonic, which aimed to enhance the network's capacity to handle up to 2,000 transactions while concurrently reducing validator stakes to 50,000 FTM, down from the previous requirement of 500,000 FTM.

However, despite the positive implications of the Sonic update, the rapid ascent in FTM's price has led to considerable overbought pressure. As a result, it is probable that this tension will be alleviated through a further decline in token prices, potentially revisiting the support level at $0.8000. Alternatively, FTM may consolidate within the range of $1.0000-1.2000, although this scenario appears less likely given the current market dynamics.

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Rafael Quintana Martinez
Money Manager de alto rendimiento, con una sólida formación académica, profesional y de campo. Más de 9 años de experiencia especializada en el comercio de mercados financieros internacionales. La devoción, la fiabilidad, la responsabilidad y la ética impulsan mi vida. Actualmente me desempeño como Analista Senior para Metadoro. https://metadoro.com/es https://mx.investing.com/members/contributors/235587671/ https://es.tradingview.com/chart/EURUSD/rE9gVips/
HP is Entering a Buy Zone

HP Inc (HPQ) appears to be gradually narrowing the gap with the broader market. While the S&P 500 broad market index has surged by 27.5% since October 30, 2023, HPQ has lagged behind with a modest 16.4% increase. This disparity presents an opportunity for investors to capitalize on undervalued stocks amidst an environment where many shares are considered overbought.

Recognizing this potential, I plan to initiate a position in HPQ within the price range of $29.50-30.10. By entering at this level, I aim to capitalize on the stock's upward momentum and target a price range of $34.00-35.00, representing a 15% upside potential within the next two months.

To manage risk, I will implement a stop-loss order at $25.00, providing a safeguard against unexpected downturns in the stock price.

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