Latest Stock Buy or Sell? Make More Informed Decisions!
Today, Larry Berman CFA, CMT, CTA and Stockchase Insights commented about whether FT-T, XDIV-T, MITK-Q, TOU-T, AC-T, BCE-T, CIBR-Q are stocks to buy or sell.
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Believes S&P 500 record high a result of recovery in tech names. A.I. theme very powerful in bringing up strength in markets. Falling interest rates good for prospects of tech companies. Waiting to see if strength in markets is sustainable. Would advise investors to be cautious.
With continuing issues of being non-compliant and receiving a 'delisting determination' from the Nasdaq, we would continue to see this name as a hold. Momentum and earnings results have been improving, but the inability to comply and report in a timely manner is concerning and representative of a management team that is currently not executing well. We like the company's operations and its fundamentals, however, due to its non-compliance and notice that its 10-Q for the period ending December 31, 2023, which is due on February 9, 2024, will not be completed until its 10-K has been filed. Until these issues resolve, we would be comfortable holding the name.
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XDIV looks solid with a low MER and distribution yield near 5%. It is a smaller ETF with under $1B in assets under management but it did outperform some of the names on the list. The concentrated holdings likely allow XDIV to offer the lower MER that it provides but that can be riskier. XDIV does aim to invest in low risk companies however so the concentration risk is somewhat offset. We think XDIV is a decent income option.
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FT market cap is a highly-risky $22M, and shares are down 44% in the past year. It has $9.2M in debt which adds even more risk. We are generally not in the habit of suggesting 4-cent stocks. It did recently receive $714,500 in government funding but this will not go a long way. Insiders own 6%. It has no revenue, has never made money and has negative cash flow. It is 'collaborating' with Rio Tinto, but we would not expect a buyout here and would not endorse it.
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What Are "Beaten Up" Equities?
There is a subset of companies that have been “beaten up” quite hard in 2023, and still have not recovered along with the market indexes, which is the case for a variety of different reasons. Firstly, liquidity tends to initially flow to large-cap companies in recovery due to their size and popularity. Secondly, some of these companies’ fundamentals have been negatively affected by the challenging macro environment in the last few years, leading to a decline in sales and profitability. The market is currently not pricing in the likelihood of a recovery in the near term for these aforementioned names. Thirdly, some companies are trading at historically low multiples relative to their valuation averages, as they have incurred structural changes which may have impaired either their growth prospects or fundamentals.
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He's removing this from the Magnificent 7. It's fallen 16% year to date while all its peers have gained, especially Nvidia. Sales are flagging in China where a Chinese company is overtaking them. Meanwhile, US demand may be peaking. Also consider the declining value of their cards. The EV space is challenged unless Musk develops a battery that lasts twice as long as a gas car tank.
A biopharma that develops for rare diseases, such as LEMS for which CPRX's drug has received approval. But this trip costs US$360,000. Only insurance allows CPRX to charge such prices; revenues have been rising. But there's a ceiling, because there are a limited number of people afflicted with this disease. They bought US rights for the drug Fycompa, and bought a company that makes aGamree to treat another rare disease. An analyst believes the latter drug and feels shares can double. However, the firm Oppenheimer said that CPRX didn't need the money, and then the same firm was listed as a co-manager for a recent share offering. Result: shares dropped 15%. Last year, the CEO retired, and the CFO stepped down, so he thought CPRX may be sold, but the offering throws doubt on that. That said, rare disease companies are hot and so CPRX could be taken over. He doesn't like their business model: buying other companies and their drugs instead of developing their own. And their two drugs have patent protection for only a few more years--bad. There are better stocks in this space.
There's been institutional buying of the semis stocks. Analysis says that semis have been in a long-term uptrend after capitulating in early 2020, though there was middling turbulence along the way, like the pandemic boosting PC sales, then those sales falling post-Covid, pulling back 50% from highs. Ugly. But after the late-2022 bottoms in semis (and the market), semis have been rising in a nice run. Rising interest rates were killing anything tech for a while last year. The summer 2023 pullback was shallower with lower volumes than the summer 2022 pullback, says data; support held last summer. That led to a strong rebound last fall. Analysis says semis can add another 25%, but not in a straight line. Wait for a temporary pullback before pulling the trigger.
They raised guidance today, and shares jumped 3%, largely due to institutional buying. Tech analysis says shares built a base from September to this month till it caught up to its 200-day moving average. A great uptrend that saw shares break $300 recently with higher highs and higher lows. This could reach $487, based on data (last fall's pullback). Wait for a better entry point, not now.
Has been buying recently given weakness in share price. Commodity price unpredictable, but good overall business. Strong management team and natural gas a good bridge fuel. Would recommend buying.