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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.

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: Tesla

Tesla is unique in terms of its share price. TSLA stocks rallied long before the company established the production of viable and steady electric vehicles (EV) and also thanks to the reputation of its leader Elon Musk. It is true that Tesla sometimes misses its mark and deadlines to launch new models and products but it seems that the crowd invests in Tesla not for its hit-and-run strategy but because of their belief in Musk’s ability to transform our everyday life in the long run.

Tesla stocks are trading 60% off their peak prices thanks to the market correction that has been squeezing the market since the end of 2021. Nevertheless, market participants are discussing some drivers that may hit the company’s business. For example, lower gasoline prices may hamper EV sales. It is true that Americans are now paying around $3.6 per gallon compared to $5 a few months ago. But this driver is largely exaggerated as gasoline prices is not the major reason for someone to buy an electric car. A move towards green energy and minimising carbon footprints is not a short term affair, but a sustainable long-term trend that is supported by governments, including the United States and China. Besides. oil producers forecast global demand will outweigh the supply side over the coming years while also betting on higher prices of fuel. So, no short-term movements of gasoline prices would affect EV buyers, as well as TSLA stock buyers.

The more serious issue is the declining prices for Tesla’s second-hand EVs. Tesla used cars are now 15% cheaper after a summer peak. If this downtrend is sustained pressure on sales of new model could mount. Tesla is planning to increase EV’s quarterly production to 500,000 by the end of 2022 and it is likely to increase production further after launching new production facilities in Berlin and Austin. But Tesla is not a mass market. So, Tesla fans are unlikely to pay much more to get a brand-new Tesla.

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.

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.

Bash

07.03.2024

Broadcom Release Could Propel the Stock Rally Further

Fed chair Jerome Powell delivered remarks to the House committee on financial issues by saying that the US team of central bankers will approach interest rate cuts carefully as major economic parameters like growth and labour data look tight. However, he emphasized that the governors are going to reach confidence to launch cutting rates "sometimes this year". Of course, there was no specific message in his words, so that has not interrupted the broad uptrend on Wall Street. As a result, the S&P 500 futures slowly went to new heights, with nearest targets for March at nearly 5,200. Meanwhile, an assortment of assets, mostly consisting of AI-fuelled growth businesses, keep delivering nice surprises every day.

This Wednesday, CrowdStrike (CRWD) spiked by more than 20% in the opening trading gap, peaking at $365 per share. A fast wave of profit taking brought it down to now-a-support area below $320, so that I decided to add more to my stake in the stock, which already doubled its market value, as well as my profit from it, in less than five months. Even if the price comes close to $300, it will do no harm, only benefits by attracting newcomer bulls again. As one of cybersecurity leaders, CrowdStrike beat consensus numbers on Q4 earnings, giving bright guidance especially for the cloud segment that the crowd likes so much. Several large investment houses shifted their target prices for CRWD to $400 or above.

Qualcomm (QCOM) added another 2.7% in the first half an hour after the opening bell on March 7, peaking above $172 per share, yet it has at least $20 of space to the upside if one believes in repeating the all-time records of January 2021. Riding this positive wave, NVIDIA jumped to "emergency number" of $911. Going too fast, yet I expect at least $950 before I am going to run away. Right now, it looks too early to hide the nests or fold everything, yet too many guys in this market are waiting for $1000 in NVIDIA, so that smart people may start profit fixing when we are all just around the corner from this four-digit number. In March, I am going to liquidate most of my stakes in NVIDIA, before it smells like roast. Other AI stocks are good enough yet not so viral or meme assets.

Ultimately, Broadcom (AVGO) quarterly release is widely awaited after the market close on March 7 to bring even more manna from heaven on our heads. If everything will be OK with the report, this may boost other AI stocks even higher. Yet, if some weaknesses would be detected in numbers from a nearly $650 billion business, it already passed the way from $900 in early November to $1400 in this month, and keeping the stake intact looks as a reasonable solution personally for me, even in case of temporarily and sharp price adjustment. Dip buyers would not be slow to come to the rescue when NVIDIA and others continue to hit records. With all that being said, surpassing $1500 could be a dangerous red line when I would think at least of selling a good half of my stake here.

AVGO

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/

07.03.2024

OMG is Likely Consolidating Now

OMG Network (OMG) is trading neutral around $1.160 this week. With Bitcoin (BTC) up by 6.2% to $66,850 per coin, it seems that OMG is underperforming. However, it has risen impressively by 85.0% since the beginning of February. It performed even better with a rise of 115.0% on March 3, reaching $1.349, while BTC increased by 57.0% during the same period. So, OMG has likely exhausted its potential for now. There are no fresh news about the token since January. Breaking through the strong resistance level at $1.150-1.250 without any internal positive reasons seems challenging. Therefore, it is likely that the token will enter a consolidation phase.

OMGUSD

MetadoroIn-house analytics

07.03.2024

A Useful Kind of Gauge for Economy and Market Trends: Target

Target Corporation (TGT) is usually referred to the segments of consumer discretionary and consumer staples at the same time, as this North American chain of stores partially rely on people spending money that they don't need to spend. Yet it also lies near the thin facet to consumer staples, as Target's business strongly focused on low-priced urgent need goods, such as everyday food or hygiene supplies, along with electronics or clothing retailing of different price categories. This way of business positioning makes many experts even more willing to watch Target share price behaviour as a perfect health indicator of the broader market.

Target was riding high at the time of corona outbreaks, and then it was suffering on charts from May 2022 to October 2023, supposedly pointing at still elevated recession risks. Yet, it already recovered by more than 55% since mid-November, including the latest jump from $150 to nearly $175 per share during this week. This took place after the company's management gave several clear bullish highlights in its Q4 release on March 5, including highest EPS (equity per share) level in two years at $2.98, compared to $2.41 of consensus expectations and $1.89 one year ago, as well as its detailed strategic plan of driving long-term growth further, relying on paid loyalty programs which collected over a 100 million members to reignite repeating purchases, digital sales contribution, with same-day services accounting for 70% of that growth. This was the result of investing $100 million in hubs to speed up delivery about a year ago by building a larger network of sortation centres to lower costs to give a reason for soaring profitability on similar revenue numbers which added only 1.7% YoY, as comparable store sales declined by 5.4%. Online orders made up 21.3% of all Target sales. Partnership with providers like UPS, FedEx also helped a lot.

Target CEOs said they foresee only light pressure in the current quarter but continued climbing later in the year. High level of adaptation to changing consumer behaviour due to the lack of ready money in their pockets becomes common for other retailers including TJX and Walmart with AI-based technology features. Target CEO Brian Cornell also had an AI speech when he talked about ten additional supply chain facilities with further integrating machine learning and driving early adoption of generative AI to take not costly but same day fulfilment. TGT stock is not necessarily a top pick up on Wall Street, as it still could be volatile bearing the common stamp of the hard time troubles, like other retailers. RBC Capital increased its price target for Target Corporation to $191, as an example, which is not so far away from the current height. UBS did the same by reaffirming an Outperform rating on the stock, but with the same $191 potential as a target price. However, climbing Target or Walmart stocks are the mirror of the ongoing bullish efforts on Wall Street, being a useful kind of gauge for correcting or keeping investors' stance intact for the nearest period.

TGT

Rafael Quintana Martinez

07.03.2024

Honeywell Stock are Struggling to Keep the Upside Momentum

Stocks of Honeywell International (HON), an American aerospace corporation, fell below the ascending channel support that was established on March 18, 2020. Prices dipped to $174 per share in October 2023 but returned within the ascending channel. It seems that they will do the same this time as well. Prices appear to be recovering towards the support already. The dynamic nature of Honeywell's business provides additional support for its stocks. I don’t set high targets, but a 12-13% rise to $225-230 per share I see as plausible. Stocks may even hold on to the support of the channel that will lead them to this target in the next 2-3 months. The stop-loss could be placed at $173, which is the lows of October 2023.

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