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06.10.2022
Top 3 Financial Stocks: CME Group

CME Group is the largest market place for derivatives. CME stocks dropped by 25% from the beginning of 2022. The only reason for such a decline is the overall market correction and not any business issues. High volatility is a benefit for the company as it offers the most important derivatives to mitigate financial risks. Among those are the most popular S&P 500 index futures and other indexes linked to derivatives, agricultural products, gold, silver, and crude derivatives. So, the company continues to receive decent profit that allows for the payment of high dividends to its investors.

Free Cash Flow (FCF) of the company in 2022 is expected to hit $2.8 billion. CME is improving its efficiency as every Dollar received in 2021 was converted into $0.48 of FCF, while this year this figure is expected to rise to $0.55, and in 2023 to $0.57. Regular annual dividends is at $4 or 2.3% of share value. CME is also paying interim dividends. By doing so, it paid $3.6 regular dividend and $3.25 interim dividends in 2021, or $6.85 per share, slightly above FCF per share at $6.77.

CME has a solid business model and sound financials without substantial debt. These facts allow the management to take more care of the company’s shareholders. The current overall downside configuration offers great opportunities for investors to add CME stocks to their long-term investment portfolios.

15.12.2022
Three Undervalued Value Stocks: Costco

Costco Wholesale Corporation has presented quite disappointing earnings report for the Fiscal Q1 2023. Revenues were reported up 8.1% year-on-year to $54.44 billion missing expectations of $54.65 billion. This is obviously not the reason for long-term investors to remove COST stocks from their portfolios as the company is set to maintain strong financial discipline and cost structure, not to stimulate high growth in the short term at any cost.

The operational margin in financial Q1 2022 was at 3.4%, and in Q1 2023 it was 3.2%. Costco is aiming to provide the most reasonable prices on their products to keep their clients loyal. That is why the operational margin is suffering. Meanwhile, EPS was up by 4.4% to $3.1, and membership fees rose by 6% year-on-year. So, the strategy seems to be buying itself.

Inflation in the United States is expected to return under control over the next year. So, there will be no need to deliver various marketing activities like coupon sales and others while loyal clients will be grateful for the support during the period of uncertainty. Costco is planning to open 24 new stores in 2023, increasing its potential to generate revenues.

11.01.2023
Advanced Crypto Assets: dYdX

DYDX tokens suffered a lot during the ongoing market correction and lost over 95% off their peak prices. dYdX is an advanced decentralised exchange, where clients can exchange cryptocurrencies and derivatives with marginal collateral. There are no KYC procedures to be followed within the exchange, as well as no need to disclose your personal data.

dYdX is runs on the Ethereum blockchain, known for its expensive transaction fees. However, StarkWare solution allows for lower fees as only commissions for trading are charged. The platform now runs on Layer 2 protocol which is incorporated into Ethereum’s  main network. This solution allows for transactions to be conducted instantly, while traders do not have to pay miners for validating transactions.

Market players are closely monitoring the dYdX V4 vehicle, which is  a standalone Cosmos blockchain, featuring a fully decentralised, off-chain, orderbook and matching engine. In other words, developers are going to create the entire trading infrastructure to scale up processes without involving any third-party applications. The service  cancelled two stimulus programs in order to lessen the effects of inflation within the dYdX platform and to support token prices.

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.

15.09.2022
Safe Haven Assets for Long-Term Investments: Broadcom

Broadcom is an American semiconductor and infrastructure software development company. Soon it is expected to close a merger deal with VMware, a cloud computing and visualization company, that will open new cross-sales opportunities for Broadcom to boost its revenues. Broadcom stocks are now 25% off their peak values.

According to the Q3 FY 2022 financial report that ended July 31, consolidated revenues grew by 25% year-over-year to $8.46 billion, and EPS went up by 40% to $9.73 per share. The semiconductors segment, that added 32% year-over-year, was the primary driver for the company’s profit. The company’s free cash flows (FCF) topped $4.3 billion, allowing it to spend $1.7 billion on dividends and 1.5 billion on the shares repurchase program. The company is planning to continue spending at least 50% of FCF on dividends that added 43% every year on average since 2016. 

According to the Q4 FY 2022 forward guidance, the company is expecting its revenues to go up by 20% year-over-year to $8.9 billion and for EDITDA to go up by 25% to $5.6 billion. Broadcom has great experience in expanding its product portfolio by M&A operations, and apparently it will continue on this way. The company is also expected to benefit greatly from the $52.7 billion CHIPS bill in the United States.


How to Choose Cheap Perspective Stocks: Zoom

Zoom stocks dropped by 85% off their peaking prices and are unlikely to recover to these peaks any time soon. But the risk around profit ratio seems to be very tempting. The company is generating high profit with net cash on the balance of $5.4 billion, which is above 25% of its current market cap. The company’s operational margin is at 36.2%. The company has spent $1 billion on a buyback, which is not very impressive. But management is concentrating on development, and not on rewarding investors now.  Management expects revenues of $4.455 billion for the full-year FY 2023, which is only 1.3% above the 2022 level. So, Zoom has no more steam to astonish investors with rampant growth figures, but it does still generates quite remarkable financial results with estimated non-GAAP income of $1.626 billion in 2023, beating consensus by 5%. The company is planning to improve margins further, including staff cuts by 15% this year. The major of the risk comes from its rival Microsoft Teams. Zoom’s management is seen to be focused to continue product development and investments while taking leadership as a reliable and outstanding product among corporate clients.  

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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/
GBP Is Set for a Rendezvous with a Triple Top Pattern

GBPUSD touched the resistance level at 1.24 for the third time since last December. There is no sell signal for the GBPUSD, but we may expect one over the coming days. As it is well known that  one the most popular candlestick patterns, the “absorption,” gives us around a 35-40% chance that signals will become active. It’s one of the easiest patterns to recognise as it consists of two candlesticks where the second one is larger than the previous one and it is visually clear that the second one seems to absorb the first one. When black candlesticks absorb white ones, it is at this moment that GBPUSD should be sold. Another indicator to be tracked is the 200 EMA on 5-15-30 minutes chart. Candles should go below this moving average and remain there to signal a downside move to 1.20. In another scenario, the price is likely to bounce above the 1.24 price and climb towards 1.26.

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Euro Is on the Crossroads

I believe the banking instability has raised fears about a broader financial crisis and this has resulted in a significant shift in the Federal Reserve’s (Fed) monetary policy expectations. This factor is the most powerful driver for the EURUSD. We can’t be positive about forecasts predicting that the Dollar will go down or up because of this. That’s why it’s important to pay attention when the Euro will approaches the 1.09-1.10 area for the second time this year. There are no short signals so far, but technical resistance and volatility may send the pair down to 1.06. If the pair jumps above 1.10, it may continue to surge up to 1.15 over the coming weeks.

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Tech Giants’ Troubles: Amazon

The pandemic caused Amazon’s revenues to boom with a huge expansion of its marketplace and Amazon Web Services (AWS). But the perfect storm arrived in 2022, as supply chain issues, high inflation, rising interest rates, falling consumer spending, and a strong Dollar hit company’s financials. Free cash flow dropped to the negative zone with -$23.5 billion in the Q2 2022 compared to positive Q2 2020 with $31.9 billion, though it seemed to be recovering in early 2023. Capital expenditures have eaten up most of the cash as they rose from $35 billion to $58.3 billion over the last three years. Amazon CFO, Brian Olsavsky, said the company is satisfied with investments in business development, and has reduced capital expenditures in Q4 2022.  Amazon is actively transforming into a service company with a rising share of AWS business that has boosted its revenues by 20% year-on-year in the last quarter of 2022. This is a much more marginable division of the company compared to the retail business, and is likely to become the major driver for Amazon growth. The other fast-growing segment is advertising. The segment has recorded sales of $37.7 billion during 2022 compared to $19.8 billion in 2019. Thus, the discount of 50% to AMZN stocks peak prices look very attractive for long-term investors.  

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