PayPal's Stock Is Starting to Be Quite Appealing
PayPal's stock has been caught in a mean bear. Check out the chart: The stock's lost about 80% of its value in just about 2 years. But the company is still profitable. The annual earnings and estimates are as follows: . This said, both sales and earnings growth are decelerating. The company is seeing intensifying competition from the likes of Square (Block), Stripe, Apple Pay, Google Pay, Shopify, Amazon Pay, not to mention incumbents FIS and Fiserv, and card processing majors Visa and Mastercard. No wonder activist investor Elliott Investment Management recently dissolved its stake. But the company has a number of levers it can activate to repel rivals and even thrive. It can increase the number of transactions per installed account (it's still the...
Trailblazer UiPath's Path to Higher Altitudes
Investing Rationale As it revolutionized not one, but several industries, Amazon's stock went from $.08 to $123 (as of end of day, June 7, 2022, after adjusting for splits) in 25 years. Invest $10,000 at or shortly after the IPO, and two decades and a half later, you find yourself inheriting a fortune of $15,375,000. Essentially, one dollar turns into $15,000. You read that right! All you had to do back then, and we have to do now, is pick the right horse and never sell. Hold, no matter what. Bears, wars, revolutions, bugs and viruses, recessions, terrorism, inflation, presidents, hardly make a dent. Let's find the next Amazon. We'll make some mistakes along the way and apologize for the...
Inflation, Recession, Bear Markets, and Long-Duration Stocks
Inflation hits the purchasing power of the middle class and the poor the most. It's a regressive tax. No wonder the Federal Reserve holds the line for now. Interest rate increases hit the stock market, thus the wealthy and upper middle class, harder. Social justice is being served? Meanwhile, an earnings recession may be well on the way via deflation, which hits profits. What's interesting is that growth/long-duration stocks have been hit hard by the rates-driven (first-stage) bear, but the second wave of selling may not impact them nearly as much. The reason why seems simple enough: growth/long-duration stocks currently have no earnings. Future profits have already been rerated (for the most part). They may thus start to bottom... There is a logic to this. They were hit...
Fun & Shoals - The Case of Biotech
Financials can be Fun & Shoals of (not herrings but) airings - of Grievances & Opportunities. As exemplified by the XBI SPDR S&P Biotech ETF (see below), since January 1, 2021, Biotech has been caught in a severe downtrend, losing about half of its value. It has started to rebound. Can it keep the momentum going? XBI Stock Chart Source: https://www.etrade.wallst.com/v1/stocks/charts/charts.asp?symbol=xbi&rsO=new In most likelihood, yes. A number of large companies in the big pharma/biotech sector [Pfizer (PFE) after its COVID success, Novartis (NVS) after selling its 20% stake in Roche, Moderna (MRNA), etc.] are flush with cash and may use it to acquire smaller firms, at a time when lots of biotechs are rather cheap, if not well-undervalued. Meanwhile, new innovations...
Financials = Fun & Shoals - The Case of UiPath Inc. (PATH)
Financials can be Fun & Shoals of (not herrings but) airings - of Grievances & Opportunities. Consider the case of UiPath. Growth stocks won't stay unloved forever.