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16.06.2022

Not Every Tech Stocks are Equally Strong: SAP

SAP stocks have lost 30% since the beginning of 2022. The German tech company develops enterprise software and solutions to manage business operations. For example, one of its services can be used to manage all business travel financial activities and related spending. In other words, it is quite a routine company with a stable and strong cash flow. Once SAP software is installed on a corporate level it is hard to do without it as it is deeply integrated into the business core processes. Moreover, SAP is restructuring its business model around its subscription base and this will allow for cash flows to be even more predictable and balanced through the financial year. Such a model is in favourable to Wall Streel investors.

The war in Ukraine has a 300-million-euro negative effect on SAP business, and it is only a marginal 1% of the overall revenue base for the company, while its dominance in the ERP segment is secure. The revenues added 11% year-on-year to 7.08 euros in Q1 2022. The revenues grew by 6% in Q4 2021.

The company has made some successful M&A deals, acquiring Qualtrics, a cloud-based subscription software platform, that delivered +48% revenue in Q1 2022. This company had a gross margin above 90% in 2021 while SAP’s gross margin was at 70% for the same year.

SAP management promised to triple its cloud-based business by 2025, and boost revenues to 22 billion euros, while operational profit is forecasted to grow by 40% from the current 8.4 billion euros. This is a very extensive growth for the company that has a high P/E ratio at 17. The company may not perform very high growth rates as its younger tech sector peers, but it may certainly recover to new all-time highs in the long-term perspective. However, the sector may require several quarters to recover, and the recovery would be headed by such reliable companies as SAP with a low risk profile.

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.

12.05.2022

Perspective ETFs in the ESG energy segment: Invesco Global Clean Energy Portfolio ETF

This ETF invests in green energy ventures. The pandemic led to a 300% increase of its share price. But since the beginning of 2022 they have lost 30%, twice as much as the S&P 500 SPY ETF. The net capital which has outflown from the Fund has reached $31.5 billion over the last 12 months, while the major outflow was recorded in December 2021. However, its shares are still seen to be overbought as P/E multiplier is at 24 that is well above the average of 20 for the EFT’s that are linked to the S&P 500, while the dividend yields are above PBD’s numbers.

Inflation in the United States is rising negatively affecting all shares with a high P/E ratio. So, we may expect a further decline of the PBD share price and other similar assets that cannot be protected from rising risks. Traditional energies are looking more attractive on this background and could be a perfect hedge asset amidst geopolitical uncertainties.

12.04.2024

CarMax Is More Committed to Innovations But Market Conditions Make It Sinking

CarMax (KMX) quarterly report came out on April 11, vividly displaying why any immediate investment into the used car market still sounds like not a good idea. The stock quickly lost ground, wasting a double-digit number of percentage points as a response to its net income drop to $0.32 per share against $0.44 cents per share a year ago, also compared to much stronger $0.52, $0.75 and $1.44 per share in the previous three quarters. Analyst polls estimated a net income per share at about $0.50, which would be 56% better than the reality.

This almost looks like a financial fiasco in the company's efforts to withstand slowing demand in the segment. CarMax Q4 2023 revenue decreased by 1.7% to $5.6 billion, slightly below consensus expectations of $5.8 billion, indicating the lack of gross marginality of the business. This happened even though the total supply of unsold used vehicles on dealer lots grew by 9% YoY to 2.27 million units in March, according to Cox Automotive data. CarMax CEOs delayed their own goal of selling over 2 million units annually, when measuring combined retail and wholesale actions, to between 2026 and 2030, from its prior target of 2026.

A "higher-for-longer" Fed fund rates is demonstrably bad for car sales volumes, be it new generation Tesla cars or just pre-owned vehicles, while operating costs for warehouses are growing. Besides, easing some semiconductor constraints in North America may help marginally improving orders for new cars, leaving used-car sales under the same pressure. Meanwhile, the entrance of Asia players offered significant discounts. Therefore, North American and European operators of the used car market need to sell many great cars at cheaper prices. CarMax already posted its official warning of a potential "hit to profit-sharing revenue" due to inflationary impact to its partners, before last Christmas. "While affordability of used cars remains the challenge for consumers, pricing improved during the quarter," Enrique Mayor-Mora, executive vice president and CFO admitted.

It was only a smaller division of CarMax Auto Finance, which managed to get a 19% better income due to "a lower provision for loan losses" and an increase in average managed receivables. Yet, this was rather news from the side business, which was clearly not enough to be optimistic. The company added that it is now focused on enhancing its omni-channel experience and leveraging data science and automation. Carmax said it delivered "strong retail and wholesale" graphic processors, which helped to increase "used saleable inventory units" more than 10%, but used total inventory units was unchanged despite innovations. The company seeks to achieve efficiency improvements in its core operations, believing that they "are well-positioned to drive growth as the market turns", according to Enrique Mayor-Mora. This may be useful to strengthen competitiveness in better times for the segment. Yet, the current challenges are too heavy to be ignored by market crowds.

11.08.2022

Perspective Peers of Ethereum: Avalanche

Avalanche is ranked by Coinmarketcap at the 12^th 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.

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/

17.03.2025

Ravencoin May Be Set for a new Rally

Ravencoin (RVN) is up 2.2% to $0.0121 this week, closely tracking the broader market, where Bitcoin (BTC) is rising by 1.1% to $83,398. Amid an ongoing correction, altcoins remain under pressure, with RVN nearing its key support level at $0.0100 last Tuesday. Historically, prices have never fallen below this threshold, and each time they approached it, a prolonged consolidation phase of three or more months followed, eventually leading to a strong rally.

If Bitcoin embarks on a new bullish trend toward $150,000–$200,000, altcoins like RVN could follow suit in the coming months, mirroring past market cycles.

RVNUSD

3077

Bash

14.03.2025

Incredible Highs in Gold vs Stocks' Correction

Both spot and futures gold prices for April hit incredible highs above $3,000 per troy ounce this week. The widely expected but still landmark achievement came as U.S. inflation cooled in the latest data sets, amid heightened tariff fears and further stock market's correction mood, which only gained momentum. Taking into account the listed take-off drivers, I personally feel that we could keep our eyes on a gradual expansion, probably limited by targets around $3,250, although price goals are unlikely to be higher within the near six months. A natural decrease in interest in precious metals can occur, as soon as money again will flow into properly discounted tech stocks.

A temporary return one step lower, let me call it $2,900+, cannot be completely ruled out either, being fully aware of how gold traders have been cautious, maintaining upward pressure but retreating time and again back, before ultimately going for a decisive upward surge. So, for short-term traders especially, I would not recommend placing stop-loss orders higher than $2,900, as their positions could simply be knocked down by any quasi-random rollback in prices. Yet, the path to the tops now looks cleared.

To clarify the inflation component, the U.S. CPI (consumer price index) rose by 0.2% only, instead of a supposed pace of 0.5%, according to February's metrics, which came out on March 12. This led to a lower-than-expected annual increase of 2.8%, down from 3.0% gain a month ago. This moderation in inflation was later confirmed by PPI (producer price index) data the next day. Again, the Federal Reserve's meeting is scheduled on March 19, and no rate cut decision is expected, but markets are currently pricing in two or three rate cuts before the end of the year, with the first borrowing cost decrease being commonly projected in June of July, according to the Fedwatch tool to show the dynamics in interest rate futures. Cooling inflation works in favour of lower interest rates rather sooner than later, which in turn weakens the U.S. Dollar's position against safe haven assets such as Gold and Bitcoin in the medium term.

Meanwhile, Gold outperformed overheated stocks on this stage of an overall uptrend in most assets, as growing business income is under question when more mutual restrictions are coming or under way from rivals and partners of the Trump-led United States. The first term of the sitting president has shown that tariff fears were only temporary obstacles that have been overcome repeatedly, but two major stock market pullbacks of 10% and 20% occurred in 2018, although the S&P 500 broad market index has grown by 62% overall from November 2016 until the start of the corona pandemic. Meanwhile, Gold climbed from $1,277 to $1,691, or 32.5%, over the same period.

XAUUSD

2401

Rafael Quintana Martinez

14.03.2025

Cardano Has a Strong Upside Momentum

Cardano (ADA) is trading neutral at $0.7215 this week, slightly underperforming the broader market, where Bitcoin (BTC) is up 1.5% to $82,381. The token faces additional pressure following the SEC's decision to delay its ruling on an ADA-ETF until May 29. While this news has minimal impact in a rising market, it weighs heavily on ADA during corrections.

Despite this, Cardano's technical outlook remains strong. The token recently dipped below the $0.8000 support level and could decline further to $0.6000, presenting potential buying opportunities. ADA has proven its resilience, and its inclusion in discussions about a Federal crypto reserve adds fundamental support to its long-term prospects.

ADAUSD

2700

MetadoroIn-house analytics

13.03.2025

A Higher Jump of Intel: Episode III

Intel Corp's share jump to $27.55 in mid-February turned out to be short-lived and was replaced by a retest of the technical support area around $20 in early March. However, investors in Intel have new hope after a nearly 13% spike well above $23 per share during the pre-market trading activity on March 13. In order not to rush to further mid-term conclusions, now we just need to wait until at least the end of the current week, and better yet, the dynamics of the first two days following the weekend. However, the reason for higher excitement this time seems worth attention.

A joint venture to operate Intel’s business in the United States is ultimately formed, according to Reuters sources, with a deal struck by the wide pool of great chip makers, led by Taiwan Semiconductor, with all grands including NVIDIA, AMD, Broadcom participating as Intel’s biggest potential manufacturing customers and Qualcomm "being approached". Joint venture drive for additional income and rising U.S. market share is clear but talks are still in an early stage. The only thing that looked known was that Trump's White House administration allegedly approached the Taiwan-rooted company to help rescue Intel. Such news looks more than plausible, considering Intel was suffering from technology gaps in the face of the AI chip domination. Intel missed the revolution in GPUs (graphic processing units). Republicans are ambitious for not to come to terms with Intel's loss-making factories which they consider as a national treasure. Therefore, making more efforts for a spin-off of Intel's foundry units is a reasonable step.

Another sign of a possible sanitation is Lip-Bu Tan's fresh appointment as Intel's head at this supposedly pivotal moment. To give you a small background, Lip-BuTan is a 65 yo Malaysian-born executive who grew up in Singapore, holding degrees in both physics and nuclear engineering. He initially joined Intel's board in 2022, and he led a chip design software company named Cadence before that. Cadence was among Intel's suppliers for more than a decade. Cadence stock actually climbed over 4,000% under his direct guidance. However, he had to quit Intel's board in summer 2024 due to reported disagreements with Intel's former CEO's Gelsinger's plans, as Tan got frustrated by Intel’s risk-averse and bureaucratic culture. When Gelsinger took the reins four years ago, Intel stock was trading above $60, but times are changing.

In early March, TSMC officially said at a press event with Trump that it plans to make a $100 billion investment to build five additional chip facilities in the U.S. Trump has yet to approve TSMC's proposal, but the same sources said the U.S. President is going to allow TSMC to operate former Intel’s factories under the condition that TSMC will not own more than 50% in the joint venture. Help is on the way. If so, Intel's comeback is somewhere around the corner, even though any real business transformation would take years, so that the crowd of investors should be patient anyway.

INTC

2225