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Weekly Roundup

Despite the late-week selloff, the portfolio had a rather good week, as about a dozen of our holdings outperformed the S&P 500.

Yahoo

Weekly Roundup Despite the late-week selloff, the portfolio had a rather good week, as about a dozen of our holdings outperformed the S&P 500. Despite the late-week selloff, the portfolio had a rather good week, as about a dozen of our holdings outperformed the S&P 500.

AMZN

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There's Nothing Amazon or FedEx Can Do to Slow Down This Warehouse Landlord

Amazon and FedEx are pulling back, but don't read too deeply into that when it comes to Prologis' future.

Yahoo

There's Nothing Amazon or FedEx Can Do to Slow Down This Warehouse Landlord Amazon and FedEx are pulling back, but don't read too deeply into that when it comes to Prologis' future. Amazon and FedEx are pulling back, but don't read too deeply into that when it comes to Prologis' future.

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Economic data and corporate earnings due out next week

Next week includes CPI data, retail sales, PPI, FOMC minutes, and Amazon's October Prime Day.

Yahoo

Economic data and corporate earnings due out next week Next week includes CPI data, retail sales, PPI, FOMC minutes, and Amazon's October Prime Day. Video Transcript DAVE BRIGGS: Here's a look now at what to watch for next week. Monday is Indigenous Peoples' Day, but markets are open. On Tuesday, we'll get a read on small business sentiment from the National Federation of Independent Business. And it's the start of Amazon's October Prime Day sale, which is a two-day event. On the economic front Wednesday, we'll get the Producer Price index. And the Fed minutes as well. Earnings start to trickle in with PepsiCo reporting ahead of the open. On Thursday, we get a look at inflation with the Consumer Price Index, and boy, is the Fed watching that. Weekly jobless claims plus quarterly results from BlackRock, Delta, and Walgreens, and we round out the week with the unofficial start to earnings season with bank earnings. We'll hear from JP Morgan, Citigroup, Wells Fargo, Morgan Stanley. And as for some economic data, retail sales and consumer sentiment are out.

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15 Most Valuable Companies In History

In this article, we will take a look at 15 of the most valuable companies in history. If you want to see some more of the most valuable companies in history, go directly to 5 Most Valuable Companies In History. Many of the most valuable companies in history dominate their industries. Some of the most […]

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15 Most Valuable Companies In History In this article, we will take a look at 15 of the most valuable companies in history. If you want to see some more of the most valuable companies in history, go directly to 5 Most Valuable Companies In History. Many of the most valuable companies in history dominate their industries. Some of the most valuable companies in history dominated oil and gas. Some are leaders in information technology and computing. All of the companies created a lot of value for their shareholders. In terms of what creates the most valuable companies in history, the size of the country's economy that a company is from is a key component. If a company's parent country is a small country, it is harder for that company to reach the scale needed to be considered among the most valuable in history. If the company's parent country is a nation with a huge economy, on the other hand, there are likely more markets that have the scale to allow companies to grow to reach very valuable status. In the 16th century, the Dutch were the leading economic power. As things changed, the British became the leading economic power in the 18th and 19th century. As a result, some Dutch and British companies have made it to the list of 15 Most Valuable Companies In History. In the 20th century, the United States became the leading economic power. Immediately after World War II, the United States had around half the world's GDP and much of the world's wealth. With much of the world's wealth, many American companies had the capital necessary to expand overseas and gain substantial market share. With much of the world as potential markets, American companies can gain more revenue and potentially more profits. As a result of the dominance of the United States economically, many American companies make this list. Another factor that helps companies make it to the list of 15 Most Valuable Companies In History is the era that they operate. In terms of eras, modern day companies are more likely to be more valuable given the growth in the global economy. Because economies have advanced so much over the past 100 years, the markets today are much larger than the markets 100 years ago. With globalization, modern day companies also have opportunities at a larger market. The emergence of technology has also created many valuable companies, some of which also make the list of the 15 Most Valuable Companies In History. With technology, companies can grow very quickly and potentially capture a monopoly on very valuable markets that many people use. Microsoft is one example with Windows. Given that technology may not cost all that much to produce after it's first created, some tech sectors can also have higher margins than other industries. With higher margins and larger markets, it can be easier for some tech companies to be considered very valuable. In terms of the composition of the 15 Most Valuable Companies In History, the majority are tech companies and many exist today. Pixabay/Public Domain Methodology For our list of 15 Most Valuable Companies In History, we used peak market cap to rank the companies since some of the most valuable companies no longer exist today. Some have also fallen in market cap from their peaks. For companies that existed hundreds of years ago, we used subjective measures to rank them. For the peak market cap, we used data from Ycharts. 15 Most Valuable Companies In History 15. NVIDIA Corporation (NASDAQ:NVDA) Peak Market Capitalization: $834.40 billion NVIDIA Corporation (NASDAQ:NVDA) is a leader in GPUs which is in some ways better suited for some AI applications than traditional CPUs. Given the huge anticipated growth in AI, investors sent NVIDIA Corporation (NASDAQ:NVDA) to a peak market capitalization of over $830 billion before the stock eventually fell to its current valuation of around $300 billion. If the company maintains its lead in the AI chip market, however, NVIDIA Corporation (NASDAQ:NVDA) could have upside. In terms of hedge funds, Fisher Asset Management was one of the top hedge fund holders with a holding of almost 7.6 million shares at the end of Q2. 14. Alibaba Group Holding Limited (NYSE:BABA) Peak Market Capitalization: $858.50 billion Given its market share in e-commerce and the cloud in China, Alibaba Group Holding Limited (NYSE:BABA) achieved a peak market capitalization of over $850 billion before its stock fell due to the Chinese government beginning to reign in the tech giants in the nation. With China's economy weaker and the broader weakness in the market, Alibaba Group Holding Limited (NYSE:BABA) has a market capitalization of around $220 billion. There is a chance that Alibaba Group Holding Limited (NYSE:BABA) stock could be delisted if China and the United States can't agree on accounting terms. 13. PetroChina Peak Market Capitalization:$1 trillion PetroChina achieved the $1 trillion mark briefly when it debuted in 2007. As a result, PetroChina became the first company to break through the $1 trillion mark. Since its IPO, however, PetroChina stock hasn't done very well and the company actually withdrew its listing on the NYSE. 12. International Business Machines Corporation (NYSE:IBM) Peak Market Capitalization: $1 trillion International Business Machines Corporation (NYSE:IBM) was worth $258.6 billion in 1967, which assuming the growth in the stock market, could easily be considered worth $1 trillion or even more today. As a result, International Business Machines Corporation (NYSE:IBM) is ranked #12 on our list of 15 Most Valuable Companies In History. Back then International Business Machines Corporation (NYSE:IBM) was one of the most dominant mainframe computing companies with substantial market share. Today, International Business Machines Corporation (NYSE:IBM) is overshadowed by bigger companies in computing but still has potential upside if the economy doesn't slow as much as expected. 11. Meta Platforms, Inc. (NASDAQ:META) Peak Market Capitalization: $1.078 trillion At its peak, Meta Platforms, Inc. (NASDAQ:META) was worth $1.078 trillion as the market anticipated substantial future earnings growth from the company given its billions of daily users and many different ways of monetizing those users. Given competition from TikTok as well as the worsening economy, however, Meta Platforms, Inc. (NASDAQ:META) is worth around $375 billion as of October 7. There is potential upside in Meta Platforms, Inc. (NASDAQ:META) if it can maintain its user base and grow earnings. Although the market isn't very optimistic about the metaverse, Meta Platforms, Inc. (NASDAQ:META) could also benefit if the metaverse does become a huge market as CEO Mark Zuckerberg expects. Renaissance Technologies owned almost 5.5 million shares at the end of Q2. 10. Tesla, Inc. (NASDAQ:TSLA) Peak Market Capitalization: $1.239 trillion Although it isn't the largest auto maker in the world, Tesla, Inc. (NASDAQ:TSLA) achieved the highest peak market capitalization of all auto makers with a peak value of $1.239 trillion. With a market capitalization of over $750 billion as of October 7, Tesla, Inc. (NASDAQ:TSLA) is still by the most valuable car company in the world. As the electric vehicle leader, investors expect substantial earnings growth in Tesla, Inc. (NASDAQ:TSLA)'s future. Given its CEO in Elon Musk, many expect Tesla, Inc. (NASDAQ:TSLA) to be among the leaders in autonomous driving. ARK Investment Management was one of the top holders of Tesla, Inc. (NASDAQ:TSLA) at the end of the second quarter. 9. Amazon.com, Inc. (NASDAQ:AMZN) Peak Market Capitalization: $1.888 trillion Amazon.com, Inc. (NASDAQ:AMZN) has been one of the best growth stocks over the last twenty years. As a result of its growth, Amazon.com, Inc. (NASDAQ:AMZN) has achieved the number one position in both e-commerce and the cloud, both of which are huge markets. With its positions, Amazon.com, Inc. (NASDAQ:AMZN) achieved a peak market capitalization of $1.888 trillion. That ranks the company as #9 on our list of 15 Most Valuable Companies In History. Although its market cap is around $1.25 trillion as of October 7, the stock could still have upside if it continues its earnings growth. 8. Alphabet Inc. (NASDAQ:GOOG) Peak Market Capitalization: $2.001 trillion Alphabet Inc. (NASDAQ:GOOG) has also been one of the best growth stocks since its IPO in 2004. Thanks to its leading market share in search and also its smart acquisition of YouTube, Alphabet Inc. (NASDAQ:GOOG) has become one of the most profitable companies in the world. As one of the world's leading tech giants, Alphabet Inc. (NASDAQ:GOOG) also achieved a peak market cap of $2 trillion. TCI Fund Management owned almost 2.5 million shares at the end of Q2. 7. Saudi Aramco Peak Market Capitalization: $2.43 trillion. Saudi Aramco is the world's biggest oil company and also the leading company in Saudi Arabia. Given its huge oil reserves and substantial profits, Saudi Aramco is also one of the most valuable companies in history with a peak market capitalization of over $2.4 trillion. Given the higher oil prices, Saudi Aramco reported that is net income rose 90% to $48.4 billion in Q2 2022. 6. Microsoft Corporation (NASDAQ:MSFT) Peak Market Capitalization: $2.576 trillion Microsoft Corporation (NASDAQ:MSFT) has also been one of the best growth stocks in history since its founding in 1975. As a result, Microsoft Corporation (NASDAQ:MSFT) achieved a peak market capitalization of $2.576 trillion, which ranks it #6 on our list of 15 Most Valuable Companies In History. Although it's valued under $2 trillion now due to the broader market decline, Microsoft Corporation (NASDAQ:MSFT) could have upside if it continues to grow its earnings. Click to continue reading and see 5 Most Valuable Companies In History. Suggested articles: Disclosure: None. 15 Most Valuable Companies In History is originally published on Insider Monkey.

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Why Amazon Stock Lost 5% Today

Shares of Amazon (NASDAQ: AMZN) were falling today, as the tech giant followed the market's lead and pulled back in response to a better-than-expected jobs report. Since Amazon is a cyclical business , driven by consumer spending on e-commerce and businesses spending on cloud infrastructure, the company is sensitive to the macroeconomic climate. Coming into the jobs report, Amazon had already been showing signs of weakness.

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Why Amazon Stock Lost 5% Today Shares of Amazon (NASDAQ: AMZN) were falling today, as the tech giant followed the market's lead and pulled back in response to a better-than-expected jobs report. Since Amazon is a cyclical business , driven by consumer spending on e-commerce and businesses spending on cloud infrastructure, the company is sensitive to the macroeconomic climate. Coming into the jobs report, Amazon had already been showing signs of weakness.

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The Real Reason Behind Amazon's Prime Day Round 2

Amazon (NASDAQ: AMZN) surprised the market and delighted its most loyal customers in September when it announced a second Prime Day this year. Started in 2015, Prime Day is the annual shopping extravaganza designed to drive membership for Amazon Prime, the company's loyalty program that now has more than 200 million members. Amazon touted the second Prime Day, which will be held Oct. 11-12, as a way for members to get early access to holiday deals from brands like Peloton Interactive and New Balance.

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The Real Reason Behind Amazon's Prime Day Round 2 Amazon (NASDAQ: AMZN) surprised the market and delighted its most loyal customers in September when it announced a second Prime Day this year. Started in 2015, Prime Day is the annual shopping extravaganza designed to drive membership for Amazon Prime, the company's loyalty program that now has more than 200 million members. Amazon touted the second Prime Day, which will be held Oct. 11-12, as a way for members to get early access to holiday deals from brands like Peloton Interactive and New Balance.

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Amazon and other streaming platforms consider bundling services

Streaming platforms, like Amazon and Warner Bros. Discovery, consider bundling their various services along with its streaming packages.

Yahoo

Amazon and other streaming platforms consider bundling services Streaming platforms, like Amazon and Warner Bros. Discovery, consider bundling their various services along with its streaming packages. Video Transcript RACHELLE AKUFFO: We could soon be seeing more streamers partnering for bundles. According to a new report from the Wall Street Journal, Amazon executives have been exploring selling bundles of streaming services at discounted prices through its Amazon Prime Video channels. And the Journal also reporting that Warner Brothers Discovery has discussed eventually participating in bundles with some of its rivals. It really does seem as if we're coming full circle. But I mean, we're seeing some analysts saying we're not going back to the days of cable, not to compare it, because he was saying-- and this was from Devin Emery of Curiosity. He was saying that the problem with bundling wasn't that people didn't like it. They weren't liking what they were paying for a service that they weren't really using. So a bit of nuance there, though, Seana. Would you agree, though? SEANA SMITH: Yeah, but I guess my only response to that would be, I guess, if you pay for a bundle, I don't know if you would necessarily use everything that's included in that bundle. So that would be interesting to see. And also just in terms of the pricing, that's going to be key. We don't really know from this report from the Journal exactly what Amazon is thinking, if Prime is going to be included in these bundles, or if they're thinking of maybe partnering with some other streamers and bundling their services. It's very, very vague just in terms of where they see the direction of this going. Dave, though, I do think it is a natural step in order for us to see more of these types of bundle offers, though, just given the fact that growth there within the sector has been so hard for so many of the leaders here within streaming. We certainly have seen saturation. So many companies are trying to be innovative in terms of what they're doing to drive new customers, to get new customers into their service here. Ad tier is part of that, but bundling, I think, makes sense. So it'll be interesting, though, to see how they do it. DAVE BRIGGS: Well, we just showed the two main bundles that do exist right now with the leader out of the gate, really, is that one on your left there. Disney bundle has Disney, Hulu, and ESPN+. And that makes a lot of sense for people. That's a 44% discount off of if you paid for all three of those services separately. But now, some research from CR Research shows that the average consumer is spending $219 a month right now between cable and their streaming services. So everything we got away from, we are now back in. And that's why the Wall Street Journal calls it the great rebundling. Perhaps the best example of what Amazon might do is what Walmart's doing with their membership, now getting a deal with Paramount+ and partnering there. But there's no natural streamer that fits with Amazon Prime because they have everything in the space now with movies and television shows and now live sports. I can't imagine who a natural partner would be. But yes, we're getting back to exactly what we ran away from. RACHELLE AKUFFO: And it's tough because when you figure in Walmart, their service is already $98, so are people just going to do these sort of mini bundles? Will there be a bunch of overlap if you want a bit of something and something else? Do you have to get two bundles? It's a lot. I'm not looking forward to it. But hey, if it gives us more options, we can save, like, 44%. I will do the bundling math. I will try.

AMZN

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This Most 'Attractive' Media Acquisition Target Worth 'Well Above' MGM's $8.5B Sale To Amazon In A Deal, Analysts Speculate

Needham analyst Laura Martin reiterated a Buy on Paramount Global (NASDAQ: PARA) and a $36 price target. Martin fine-tuned her quarterly estimates to reflect more robust DTC profits in 3Q22 but weaker DTC profits in 4Q22 versus her prior forecast. Despite weak scatter pricing, she believes PARA's linear TV business will operate at breakeven in 2H22, aided by solid political ad revenues of $220 million, by her estimate. Linear TV is today's cash cow paying for OTT since PARA does not own Theme Pa

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This Most 'Attractive' Media Acquisition Target Worth 'Well Above' MGM's $8.5B Sale To Amazon In A Deal, Analysts Speculate Needham analyst Laura Martin reiterated a Buy on Paramount Global (NASDAQ: PARA) and a $36 price target. Martin fine-tuned her quarterly estimates to reflect more robust DTC profits in 3Q22 but weaker DTC profits in 4Q22 versus her prior forecast. Despite weak scatter pricing, she believes PARA's linear TV business will operate at breakeven in 2H22, aided by solid political ad revenues of $220 million, by her estimate. Linear TV is today's cash cow paying for OTT since PARA does not own Theme Parks. Contrary to the popular view, she loves PARA's asset mix, including its global linear TV networks, leading FAST channel platform, broadcast stations, and Paramount+. She believes bundling can lower churn by up to 50% and elevate LTV. PARA has several bundling choices for consumers and advertisers. She highlights that PARA has multiple revenue streams in its business lines. She believes revenue diversification lowers investor risk, which drives considerable valuation upside. Also Read: Bill Gates Says 'Can't Wait To See' What Trevor Noah Does Next After Comedian Announces Exit From 'The Daily Show' The fact that PARA's linear TV business is flat or slowly shrinking does not bother her because it represents PARA's cash cow that funds its high-growth DTC streaming businesses. She believes that to win, SVOD services must have news and sports, which means they must own broadcast TV stations. After these revisions, she retained her FY22 revenue estimate at $30.6 billion for PARA but lowered her Adjusted OIBDA estimate by about $80 million to $3.48 billion. PARA is too cheap at current levels, given its sum-of-the-parts value and its takeover attractiveness. Finally, at a $12 billion market cap, she believes PARA is too small to win the streaming wars. Still, it is bite-size enough to be acquired by a larger streaming competitor for its deep library of film and TV content, sports rights, and news assets. Logical buyers include Amazon.com Inc (NASDAQ: AMZN), Apple Inc (NASDAQ: AAPL), Comcast Corp (NASDAQ: CMCSA) & Warner Bros. Discovery, Inc (NASDAQ: WBD). The analyst thinks that, besides being small and inexpensive, PARA owns one of the most valuable TV and film libraries in the media business, worth well above MGM's $8.5 billion sale price to AMZN. Price Action: PARA shares traded lower by 2.63% at $18.62 on the last check Friday. Photo Via Company See more from Benzinga HashiCorp's Medium-Term Path To Breakeven Impresses Analysts Don't miss real-time alerts on your stocks - join Benzinga Pro for free! Try the tool that will help you invest smarter, faster, and better. © 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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AT&T: Halfway Through The Pain

T's price action has been terrible and its dividend is still safe but growth is weak. Read my analysis why AT&T stock is a buy for some investors.

SeekingAlpha

AT&T: Halfway Through The Pain Summary - T's price action has been terrible. - T's dividend is still safe but growth is weak. - T is only halfway through its planned transition; lukewarm. - Looking for a helping hand in the market? Members of Growth Stock Renegade get exclusive ideas and guidance to navigate any climate. Learn More » Quick Dividend Update One month ago I explained why AT&T (NYSE:T) was a buy. I specifically discussed how T's cash flow was down but the dividend was up. And, despite the lower cash flow, the dividend was still quite safe. Now, while this is a rather gross oversimplification, you can see the dividend payout ratio for yourself: The Warner Bros. Discovery (WBD) spinoff ruins the picture with that weird "heartbeat" but otherwise, you can see that T is roughly in line with its historical payout ratio. Sure, it's up around 67% and "high" but this is really nothing new at all. I believe you might like the picture below a little bit better. I know that I like it better because it's entirely based on Free Cash Flow. Instead of the current traditional payout ratio of 67% per YCharts above we're seeing a more modest 56% via FCF in 2021. As I said as part of a forward looking view: The dividend isn't threatened. The dividend is $1.11 which will likely land somewhere between 58-62% of the anticipated free cash flows per share in 2022. Perhaps my range isn't quite big enough, but the point is that T's dividend is safe, and the yield is close to 6.5% if you're looking to collect. Really, it doesn't matter too much if we're using EPS or FCF. The story is that, in large part, T is in line with history regarding the payout ratio. Of course, this doesn't tell us much at all about T's debt load, the WBD spinoff train wreck, the price collapse or anything like that. Instead, it's just to say the T's dividend is mostly stable based on a simple historical measure. In a sense, we can say that income investors and dividend investors shouldn't be any less or any more worried than in the past. Nothing fundamental has changed there. Total Return Failure One month ago, it looked like T was nearing a low and a reasonable entry point, especially for income and dividend investors. And, I did say this: T is a reasonable Buy at this price for income investors. No table pounding. No screaming buy. No generational buy. I didn't think that one month ago and I still don't think T is strong enough while simultaneously cheap enough to warrant a strong buy. But, I do believe it's a Buy for investors who want to roughly match inflation right now, although the paltry dividend increases won't satisfy much going into the future. Keep that in mind if you're expecting to beat inflation. With T, you won't. In the larger picture but still in a short period of time, T isn't looking great. What I mean is that since I wrote about T's cash flow and dividend, the stock price is down more than 12%. Sadly, the price was already low, and yet we're down even more. Worse still, the S&P 500 (SPY) is "only" down about 7%. So, T's not beating in that regard either. The only good news about price drop and total return fizzle is that you can get more shares and more income if you're adding T right now. Likewise, you're getting a chance to lower your cost basis. This is hardly even a reasonable consolation price, but it's still something for long-term investors. The Nasty Twist On September 12th, T presented at the Goldman Sachs Communacopia + Technology Conference. Cutting to the chase, I was not impressed. I didn't spiral into some depression but some of the news was bad, and direct. Here's the first smack across the face: We understand that we've got to sustain a consistent level of investment to make that happen. And we're probably a little over 18 months into that cycle that typically in our business, given the capital intensity and the significance of what you need to do to move infrastructure, it takes about a three-year process to get the flywheel moving in the right direction. My interpretation is that T is only halfway through their transition, to reposition the company. Obviously, the first half has been ugly for at least two reasons. First, the WBD spinoff has destroyed investor capital. Or, perhaps more fairly, investors have seen the price of WBD get crushed thereby providing almost no benefit. We have seen no value unlocked in WBD. Second, T's dividend might be "safe" but T's price action has been extremely poor, with a serious decline. I don't think any serious investor believes that T price action has been stable. It's downhill. And we have 18 more months of this? Next, CEO John Stankey does flag inflation as an issue. He also indicates that political and monetary actions are taken to rectify the situation, outside of what T itself is doing. But, here's the worry: As a result of that, the best thing that we can do is that we continue to work really aggressively on the cost side of the equation. The economy from a volumes perspective and our customers' willingness to use our products and services still remains really strong. However, we are seeing input rising -- cost of inputs rising literally at every portion of the business and having to work really aggressively to carry that through. Remember that T was already getting aggressive about costs before nasty inflation and economic issues really hit the fan. Therefore, there's the threat here that T starts to get "too cute" and they keep cutting and slashing. They could easily cut away not just fat, but the muscle and bone needed for growth going forward into 2023, 2024, and beyond. Recall that we're only halfway through the transition. T isn't the most creative company so I can easily imagine the bean counters turning into butchers. Let me be very precise, using Stankey's own words here: So we had a real aggressive approach on costs in place before. We're working even harder now looking for other opportunities... The upside of the transitional activities is that T has added something like three million postpaid to the business. Also, around 300K fiber customers are being added per month. There is growth. It's not all cutting. I could continue to add good news and bad news here. But, that wouldn't change the fundamental picture much, if at all. The problem is that there's very little that makes me think T is going to strengthen significantly, or grow with any new speed. I do believe, however, that T's dividend will remain safe. Wrap Up The very short summary is that T's price continues to collapse while at the same time the business is strong enough to support the dividend. In the short term this is likely just fine for income-hungry dividend investors. That's fine. In the longer run, however, T isn't likely to produce any meaningful total return. It's a slow old dog, perhaps with fleas. There are far better total return opportunities, such as Big Tech right now, like Alphabet (GOOGL) (GOOG), Meta (META) and Amazon (AMZN). You won't get the dividends but you will almost certainly beat T overall if you're patient. And, all of that said, I'll say again that T is a Buy but only for a select group of investors who know the exact value proposition, as I've laid out above. Growth Stocks Now? Answer: Yes! Why? Because growth stocks have been hammered. There are deals. ("Blood in the streets!") Discover those growth stocks opportunities right here: Join today for less than $2 per day. And when you join, I'll instantly share my actively managed growth stock portfolios. Right now is the perfect time to subscribe because it's affordable for any budget. Plus, there is a 14-day FREE TRIAL. (You are fully protected by Seeking Alpha's unconditional guarantee.) This article was written by Analyst’s Disclosure: I/we have a beneficial long position in the shares of T, WBD, GOOGL, META, AMZN either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (44) Lots of cost cutting, the management over promising and under delivering, one dividend cut has happened and a good chance of another coming at some point. Lots of broken promises, etc. I can't see this ending well. I hope I'm wrong. Deal $'s represent equity used in acquisitions (assumption of debt the typical arrangement). 1997 Starting Point - SBC $40b market cap 1997 - Buys Pacific Bell $17b 1998 - Buys SNET $4b 2000 - Buys Ameritrch $81b 2004 - Buys AT&T Wireless $24b (60%) 2005 - Buys AT&T $16b 2006 - Buys Bell South $67b 2015 - Buys DTV $49b 2016 - Buys Warner $85b Total counting starting point - $383b Less Warner Spin ($43B) Net $340B Less $106 B today$230B gone!$212B gone!

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Tesla: 3 Things That Separate It From Its Competitors

As investors will find out in the not-too-distant future, Tesla is far more than an EV company. Read more to see 3 things that separates TSLA from competitors.

SeekingAlpha

Tesla: 3 Things That Separate It From Its Competitors Summary - As investors will find out in the not-too-distant future that Tesla is far more than an EV company. - There are 3 areas Tesla is increasing expertise in that are creating a wide moat against its competitors. - The ability to apply machine learning and AI via rapid iteration allows Tesla to target large markets with products and services that could end up being larger than its EV. I believe it's a mistake to continue to categorize Tesla, Inc. (NASDAQ:TSLA) as an electric vehicle ("EV") company because that undervalues the three major characteristics of the business that can be applied to a variety of sectors and segments of the market that have the potential to drive billions of dollars in sales. The three things I'm referring to are machine learning, AI, and iteration. When combined together, these are powerful forces with the potential to disrupt numerous markets, or create new ones, as evidenced by the push by Tesla toward self-driving vehicles. In this article, I want to explore the extraordinary potential Tesla has because it has already worked much of this out via its AI, associated with the millions of hours it has had getting feedback from its EVs. As it continues to improve on the process, Tesla is able to rapidly bring products from an idea to a prototype, to a completed product far quicker than its competitors. This is a tremendous moat when thinking of how Tesla has the expertise in hand to apply this to a wide variety of products and services. Before I get into specific products and possibilities, I want to show readers how they should view the company long term, based upon similarities between Tesla, Apple (AAPL), and Amazon.com (AMZN). What will Tesla become? Like mentioned above, I think it's a mistake to consider Tesla solely as an EV company, even though in the near term that will continue to be the major generator of revenue. The reason why is it limits the growth possibilities inherent in the development of AI and machine learning, combined with failing fast and iteration. For example, when Amazon was launched as an e-commerce solution for selling books, the thought never entered anybody's mind that the knowledge it would gather through its growing customer base and its supply chain would result in it expanding to AWS and other products, which would be significant in improving the performance of the company. In other words, Amazon is far more than an e-commerce company, by virtue of its own processes which turned it into a tech company competing on various fronts. To consider Amazon an e-commerce company would only represent a piece of the puzzle that makes Amazon what it is. The same is going to be true with Tesla in my opinion, as it leverages its strengths to apply them to products and services that have the potential to generate multi-billion dollars in revenue. Apple is similar when considering its core business of iPhones. A number of years ago investors and analysts expresses concern of the vulnerability Apple had because of its heavy reliance on its iPhone line for growing revenue and earnings. While the iPhone remains its flagship product, Apple has expanded to a variety of products and services, that together provide a significant addition to revenue and earnings that complement the iPhone, providing a cushion if sales slowdown. The difference I see between Tesla and Apple is, I believe, that Tesla has the potential to outperform Apple with its future ancillary products, although it has a way to go before it can compete with the iPhone as a core product. An argument could easily be made that the EV market will eventually vastly outperform the smartphone market, and that will be true, but I don't think the EV market is going to go up in the straight line that many adherents and fans of the sector think. The reason why is there is a huge electrical grid problem that is struggling as green tech is increasingly being used as a higher percentage of the grid. The challenge is, there are already weaknesses being experienced by some grids that have to engage in rolling blackouts in order to allow customers to have access to energy. Picture what that will be like as the number of EVs grow in the market and demand for energy expands in response to the need to charge vehicles. That is a major problem that is just beginning to be realized. The point there is it's almost certainly going to take a lot longer to meet goals set by governments, which suggests to me the EV sector is going to eventually slowdown in order to allow the electric grid to catch up. And in the worst-case scenario, people could rise up in anger if they're forced to go without electricity at times, they really need it, putting pressure on politicians and leaders to solve their energy problems by incorporating more fossil fuels into their energy demands. As it relates to Tesla, this could be a problem in the not-too-distant future that results in a slowdown of demand and sales because of the possible inability of EV owners to charge up their vehicles without putting huge strains on the grid. Looking ahead, I think Elon Musk understands the vulnerability of Tesla in relying on one sector to grow its business, and in my opinion, is positioning itself to target other growth markets that will move the revenue needle. My thesis is Tesla, in the years ahead, is going to be an AI company that leverages its tech and data to launch wide variety of products and services that have the potential to catch competitors by surprise, not only from early mover advantage, but by the rapid pace it's able to bring a product to market. A recent example of that is its Optimus robot. Optimus robot If you remember last year at Tesla's AI day, it revealed its plans for a robot that had the appearance of a human being. The announcement was accompanied by a person dressing up like a robot and jumping around on the platform; some people, at first, actually thought it was a robot doing it. While Elon Musk enjoys doing stuff like that, it was apparent he was serious about the idea behind the robot, understanding it was in fact, at the time, only an idea. Fast forward to today, and the introduction of Optimus at its most recent AI Day, underscores the ability of Tesla to rapidly develop a product over a period of several months, reinforcing the fact Tesla can fail quickly and make adjustments to improve a product, bearing in mind Optimus is still in its prototype stage. The purpose of Optimus is to provide a robotic worker that can be used in the home, office or industrial settings that can help with various needs of the particular environment it's working in. Not only can it bend down and lift up things that have some weight, it also has the dexterity to hold onto smaller tools. Assuming the potential scale is there based upon demand, Tesla wants to bring the cost down to under $20,000 in order to appeal to as wide a customer base as possible. That means it's working on a variety of skillsets the robot can use to perform a variety of tasks in different settings. The significance of this isn't Optimus itself, but the underlying AI used to quickly build it. In other words, building the body of the robot is the easy part, designing the software to operate it is the hard part. Being able to do it in a very short time confirms Tesla is able to leverage the AI it is using in its EVs and apply it to other products. Again, when thinking Tesla can apply this to other products shows the future potential of its AI that goes beyond electric vehicles. That said, it appears Tesla could have a big winner on its hands as it improves Optimus in a similar way it has been improving its self-driving vehicles. It will probably take several years before we begin to see what type of demand and potential for the robotic worker is. Concerning competition, other companies like Boston Dynamics and its Atlas robot is far more advanced than Optimus, as it has the ability to perform a variety of acrobatic exercises. Another is Agility Robotics' Digit, which can avoid obstacles (important in environment humans are present in), pick things up and put things down, and walk across different terrains, among other skills. This isn't surprising when considering Optimus went from idea to prototype in only a few months. Going forward, if Tesla's AI is going to become as powerful as I think it is, it's going to catch up with and surpass its competitors. The fact there are robots more advanced than Optimus gives investors a good benchmark to analyze the progress and capability of Tesla's AI when applying it to designing and building products like Optimus. One final thing to say about Optimus is, in the near term its primary value will be to attract new workers that like to work on cool things. The battle for engineering talent is huge, and companies providing interesting things to work on will be the winners in the competitive job marketplace. Another important development for Tesla is its supercomputer Dojo. Dojo Dojo is a supercomputer built in-house by Tesla for the sole purpose of teaching its AI. This behind-the-scenes tech is the secret sauce behind the ability of Tesla to quickly make so much progress in the tasks it's working on. As part of Dojo Tesla has been develop what it calls ExaPOD, which is a way of scaling the supercomputer to improve its performance. The company stated the Dojo ExaPOD includes a spec of 1.1 EFLOP, which translates into a mindboggling one quintillion operations per second. The first ExaPOD or cluster is on schedule to be available by Q1 2023. Below is an example of the ExaPOD. The company has a goal of building seven ExaPODs. That will make the Dojo the leading supercomputer in the world. What needs to be considered here is Tesla could have more than enough computer power for the purpose of developing self-driving vehicles. So the obvious question is, why does it need so much computing power? My opinion is it has a number of products and services in mind that we have no idea about. The most important takeaway is Tesla will have an extraordinarily advanced AI and machine learning system as a result of that type of computing power, that it will be able to fail even faster, giving itself even more of a competitive edge for markets it wants to compete in. Concerning the near term, when Dojo is fully deployed in 2023, it will have the capacity to accelerate the development of Tesla's FSD models, which will help the company widen its lead against competitors. Where Tesla stands today While we're talking about extraordinary future potential for Tesla, we still need to look at where the company stands today in order to manage near-term expectations. As the company stands today, I think it's valued at close to where it should be. When the company starts to roll out new products based upon its AI expertise and its leading supercomputer, that will change, but it will take some time. Based upon its EV business, Tesla trades at a huge premium against its competitors, but at 56x forward earnings, it seems to me it's fully valued. That's also reflected in its P/S of 8.9x; which is a hefty number. With the supply chain working itself out, Tesla shouldn't have too much trouble in gaining the parts it needs to supply the market. The one issue going forward is this: as the interest rates rise, will it end up having a negative impact on demand, based upon affordability? In other words, as supply issues resolve themselves, the company may be heading into slowing demand. If that's how it works out, it'll probably continue on through the middle of 2023, depending upon how much interest rates fall and if the Fed signals it's done increasing rates. On the other hand, there is pent-up demand from the supply chain issues, so there could be some decent momentum that higher costs may not have an impact on in the near term. Conclusion I've read some thoughts on what investors think Tesla is boosting Dojo for, but it really doesn't matter. Since one ExaPOD is more than enough for its self-driving segment, it's plain to see that Tesla is boosting its supercomputer power in preparation for something big in the future. What this confirms is Tesla isn't just talking about being more than an EV company, but is taking visible steps to improve its AI and machine learning in order to empower the company to take an idea from concept, to prototype, to a functional product or service quicker than its competitors. The bottom line is, even though Tesla's EV business has been under pressure lately, it has a lot more in mind for the business than limiting itself to that market, even though it is a very large one that will continue to grow for many years into the future. It'll be the bread and butter of the company for the next several years, but I'm expecting announcements in the months and years ahead that will give more clarity concerning what it plans on using its advanced AI and machine learning for. Since it will end up with the most powerful supercomputer in the world teaching and training its AI, the possibilities are endless, although the company will without a doubt focus on large enough markets that will significantly move the needle of the company. In the present, Dojo will further advance Tesla's already formidable AI expertise, accelerating the advancement of its FSD models and other EVs it's developing. Once the economy improves, even higher interest rates are unlikely to dampen the pent-up demand with its EVs, and ultimately, its FSD vehicles. There will probably be more short-term pain for Tesla shareholders, but over the long term I believe they're going to be strongly rewarded once sentiment turns positive. This article was written by Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (276) Unfortunately, I see no evidence of any technological moat at Tesla. Either in the product side nor on the manufacturing side. I see lots of fan sites and smoke and mirrors, but nothing substantive. 100 percent automation was going to be the future at Tesla. Didn't happen. Robots moving too fast to see. Didn't happen. An open topped unit construction architecture that would allow the interior to be installed from above. Didn't happen. Today, it's very large scale die casting of the entire rear subframe assembly. There are very good reasons to seriously doubt whether this will actually lower costs. And we have heard nothing about it since its introduction with much fanfare. Tesla supposed to have some kind of revolutionary new battery. No evidence that it performs any differently from anyone else's batteries, including those that Tesla buys from outside suppliers. The vehicles themselves seem to perform about the same as competing vehicles from companies like Daimler Benz. Tesla has lost leadership in the critical light truck segment, and has lagged behind in electric heavy trucks as well. Manufacture consumer goods as a gigantic mean reversion machine. It is extremely difficult to revolutionize the industry, because, despite the assertion of Tesla fans, every manufacturer optimizes every process all the time. The cult of Elon Musk relies on the notion that everyone else in the automotive industry is an idiot, and that they somehow don't want to optimize their processes or products. When you look at a video of a Tesla assembly line, it looks just like everyone else's. There is a reason for this. Yep. You’re right. For a company that’s just recently turned profitable, and grown at better than 50%, eclipsing a $1T market cap, blowing out EV sales in North America and having the most productive EV factory in the world. There is a LOT they haven’t delivered on. It’s all deferred opportunity though, because nobody else has done it, at volume, either. The whole pie is there, and Tesla will get more than their fair share in EVs and Energy and Software and Hardware. Even through this recession Tesla extends their lead. How do? Profits. Tesla produces EVs that are responsible for ~80% of the profitable EV sales. Tesla doesn’t compete in the light truck category, yet, because margins and battery capacity have made it obvious that opening a new line would just diminish the stellar margins that they’ve already established. And finally, Musk gets beat up consistently for everything under the sun, but your point about thinking he’s always the smartest guy in the room lacks truth. At every earnings call, Tesla event etc he’s always giving praise to the team, giving credit where it’s due. With his time split between Tesla and SpaceX and…so on. He has to trust that his guys and gals will step up to meet challenges. The bad rap is partly his own fault (poor filter), but realize that a good deal of it is political or competitive in nature. EV's are a long way from dominating the automotive industry. Probably a decade. Would love to be able to help you, but if you don’t understand the implications of Tesla as a software / hardware company then there’s seriously no way to help. 2. Tesla is an energy-management company 3. Tesla is a data-mining and data-management company.When people compare P/E multiples of other (dissimilar, unrelated, manufacturing) companies, those people reveal their lack of understanding and/or outright denial of the brilliance and head-start enjoyed by Tesla.I sat in on a conference call a few years ago and I distinctly remember Elon stating that, at some point, Tesla's energy production/management revenue would eclipse its EV revenue.Though that statement is almost incomprehensible (given the number of Gigafactories that have popped over the past few years), it is entirely conceivable (RE: Congress' recent clean-energy bills/investments -- and the many that will follow).I will dollar-cost average all the way down... and all the way back up. 2. Tesla is an energy-management company 3. Tesla is a data-mining and data-management company.Tesla's energy production/management revenue will eventually eclipse its EV revenue. https://youtu.be/Grf9KeZnGLo https://youtu.be/vGojo4MVq6o https://youtu.be/wv1l6aTnB_IEvery month people with the system make videos of the success and failures. You can certainly point out it’s late but it’s still improving and they definitely have more work. You are right that the application of multiple products using the same software stack will definitely offer opportunities Have you ever successfully invested in a growth company before? I don’t think you’re giving great advice. Personally I don’t think history will care much about $200, $300, $400. Those numbers are a consequence of the FED. The numbers that will be important are $600, $800, $1000 and probably rising over the next decade. Broad Integration + Vertical integration Pace of innovationThere's plenty more. but these 3 are the primary factors.PS. The stock may crater near term. This is opportunity. In three months forward earnings (2023) will be as low as 28 if the stock stays flat. Big difference in only a few months.

AMZN

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Amazon stops testing autonomous ‘Scout’ robots that drive around neighbourhoods

Amazon has stopped testing “Scout”, its autonomous robot that would drive around neighbourhoods, dropping off packages. Instead, it will be scaled back because “there were aspects of the program that weren’t meeting customers’ needs”, an Amazon spokesperson told The Verge. “As a result, we are ending our field tests and reorienting the program,” the company said.

Yahoo

Amazon stops testing autonomous ‘Scout’ robots that drive around neighbourhoods Amazon has stopped testing “Scout”, its autonomous robot that would drive around neighbourhoods, dropping off packages. The team building the robot has been scaled back and the company is postponing its tests, according to a report in Bloomberg. However the company has insisted that it is not abandoning the plan entirely. Instead, it will be scaled back because “there were aspects of the program that weren’t meeting customers’ needs”, an Amazon spokesperson told The Verge. “As a result, we are ending our field tests and reorienting the program,” the company said. “We are working with employees during this transition, matching them to open roles that best fit their experience and skills.” Amazon has been trialling the Scout robots since 2019. Then, it noted that its robots “are the size of a small cooler, and roll along sidewalks at a walking pace”, as Amazon launched trials in its home state of Washington. It said that the robot had been specifically developed with a view to “ensuring the devices can safely and efficiently navigate around pets, pedestrians and anything else in their path”. The company did not give any specific indication of the problems that early users had with those robots, or why they had given negative feedback. Amazon has gained some fame for testing a variety of different ways to complete the final part of its deliveries, having also trialed other technology such as drones. But for the most part those tests have not yet succeeded, and the vast majority of deliveries are done by humans. The decision to cut back work on Scout is part of a broader move to stop some of the more speculative and future-facing work, amid a slowdown in growth. It has abandoned a number of other products in recent months, the site noted. Join our commenting forum Join thought-provoking conversations, follow other Independent readers and see their replies

AMZN

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2 Technology Stocks For Your October 2022 Watchlist

Check out these technology stocks for a potential buy and hold opportunity.

StockMarket

Technology is playing an increasingly important role in our lives today. As we become more reliant on technology, it is becoming more important for businesses to invest in technology. With that, technology stocks are a type of stock that represents ownership in a company that produces or uses technology. Technology stocks are popular with investors because they offer the potential for high growth. Notably, some of the more popular technology stocks among stock market investors today are companies such as Amazon (NASDAQ: AMZN), Alphabet Inc. (NASDAQ: GOOGL), and Meta Platforms Inc. (NASDAQ: META) just to name a few. Technology companies often have high-profit margins and strong market demand for their products. However, investing in technology stocks can also be risky. Technology companies are often volatile and susceptible to sudden changes in the marketplace. When investing in technology stocks, it is important to carefully research the company before making a purchase. You should also be aware of the risks involved. Furthermore, technology stocks can provide investors with the opportunity to earn high returns, but they can also be risky. Before investing, it is important to understand both the potential rewards and risks involved. If this has you keen on investing in the tech sector, here are two technology stocks to watch in the stock market today. Technology Stocks To Watch Right Now - Microsoft Corporation (NASDAQ: MSFT) - Apple, Inc. (NASDAQ: AAPL) 1. Microsoft (MSFT Stock) Starting off the list today is Microsoft Corporation (MSFT). In short, Microsoft is an American multinational technology company. Additionally, the company develops, manufactures, licenses supports, and sells computer software, consumer electronics, personal computers, and related services. Its best-known software products are the Microsoft Windows line of operating systems, Microsoft Office office suite, and Internet Explorer and Edge web browsers. MSFT Recent Stock News In September, Microsoft reported that its Board Of Directors have declared a quarterly dividend of $0.68 per share. This represents a $0.06 or 10% increase in dividend payment from the previous quarter’s dividend. Moreover, the dividend is payable on December 8th, 2022 to shareholders on record on November 17, 2022. Separate from that, Microsoft also reported that it will be hosting its 2022 annual shareholders meeting. Specifically, the company’s annual shareholder meeting for 2022 will take place on December 13, 2022. MSFT Stock Chart Meanwhile, so far in 2022, MSFT stock has fallen over 29% as of Friday’s mid-morning trading session at $235.68 per share. What’s more, shares of Microsoft stock is currently trading 32.58% off of their 52-week high of $349.67 a share. [Read More] Top Stocks To Buy Now? 3 Industrial Stocks To Check Out 2. Apple (AAPL Stock) Next, Apple Inc. (AAPL) is an American multinational technology company. Simply put, the company designs, develops and sells consumer electronics, computer software, and online services. The company’s hardware products include the iPhone smartphone, the iPad tablet computer, the Mac personal computer, the iPod portable media player, the Apple Watch smartwatch, the Apple TV digital media player, and the HomePod smart speaker. AAPL Recent Stock News Recently, just last month, the company released its new product lineup to investors. In detail, Apple reported it has launched a new iPhone® 14 Pro and iPhone 14 Pro Max. For context, this new iPhone will include extra features that include an Always-On display, the first-ever 48MP camera on an iPhone, and others. Moreover, the company also reported that they will be introducing the new Apple Watch® Series 8 and the new Apple Watch SE®. AAPL Stock Chart Year-to-date, Apple stock is still down 22.50%. Meanwhile, on Friday morning, shares of AAPL stock are trading at $141.14 per share. If you enjoyed this article and you’re interested in learning how to trade so you can have the best chance to profit consistently then you need to checkout this YouTube channel. CLICK HERE RIGHT NOW!!

AMZN

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Why I Bought More Amazon Shares For The First Time Since 2016

Amazon will report earnings at the end of the month. The stock has traded sideways for more than two years. Read why it's now time to buy AMZN stock.

SeekingAlpha

Why I Bought More Amazon Shares For The First Time Since 2016 Summary - Amazon will report its Q3 FY22 at the end of the month. - The stock has traded sideways for more than two years. - The incredible performance of AWS remains buried under inflationary pressure and supply chain challenges on the retail side. - Prime continues to get better for members and is at an inflection point. - As AWS, advertising and subscriptions become a larger piece of the pie, the risk-reward is increasingly attractive. - I do much more than just articles at App Economy Portfolio: Members get access to model portfolios, regular updates, a chat room, and more. Learn More » A simple premise Yes, I recently bought Amazon (NASDAQ:AMZN) shares for the first time since 2016. Let's cut to the chase if you don't have time to read the entire article. My thesis is simple: AWS alone justifies an investment today. The stock has traded sideways for more than two years, but AWS has continued to deliver outstanding growth. As a standalone company, AWS would probably sport the same market cap as Amazon today (more on that later). AMZN looks terrible on most screens focused on trailing financial metrics. Temporary headwinds are the main issue: Inflationary pressure, supply chain challenges, and a significant equity loss related to Rivian (RIVN). AMZN is one of the 12 Starter Stocks in the App Economy Portfolio. Mega caps are usually not at the top of my watch list, but the recent market sell-off has created better entry points. Amazon fails on several of my screeners due to a relatively low gross margin and a weak balance sheet (I'm not too fond of companies with a net debt position). However, if, like me, you are a long-term investor with a time horizon beyond five years, I believe AMZN offers an attractive risk-reward today. And it's not just an AWS story. Prime is getting better. Amazon has accumulated a trove of content, from live sports to high-profile shows and movies. As its exclusive content catalog expands, the subscription's value becomes increasingly strong. Additionally, with the possibility to "buy with Prime" on other websites, the platform is expanding beyond its walled garden. Additionally, Prime's potential is still largely untapped outside of the US. With more members flocking to its ecosystem, Amazon is turning into an advertising powerhouse that could improve the margin profile of the non-AWS segments. Finally, I like the recent acquisitions that could boost smart homes and healthcare initiatives. They add optionality. While the cash flow margins have compressed in recent quarters, I believe the long-term thesis is alive and well. There's a tremendous runway ahead and the potential for the "sum-of-the part" to unlock more shareholder value. In summary: - AWS justifies the entire valuation. - Prime is expanding its value beyond its walls. - Advertising will improve the margin profile ex-AWS. - Strategic M&A continues to offer optionality to the business. Meanwhile, the concerns du jour around inflation, labor supply shortages, supply chain challenges, recession, international slowdown, and cash burn are temporary by nature. I trust management in assessing that these should be temporary issues. I expect the traits that look undesirable today to become old news as AWS, subscriptions, and advertising become a larger piece of the overall business. I look well beyond this cycle and believe the improving margins could lead to market-thumping returns for shareholders. Are you still here? Let's dive into more details. The one chart you must see Sometimes, a chart is worth a thousand words. I summarized the flow of Amazon's Q2 FY22 income statement in the diagram below. - Do you like Amazon's long-term potential from here? - Has the valuation cooled down enough? - What are the main risks and opportunities you see for the company? If you are looking for a portfolio of actionable ideas like this one, consider joining the App Economy Portfolio. We are in a bear market, and our community is rising to the occasion. I put my money behind my ideas and provide all-inclusive access to my portfolio and all my trades. We are in this together! The portfolio has beaten the market since 2014. This article was written by My portfolio is built to disproportionately benefit from sea changes in technology that disrupt existing financial models and create massive shareholder value. My investment plan and asset allocation are a result of secular trends I have identified (macro) and in which I take individual bets (micro). I invest with a very long time horizon (ideally 10+ years). I am fortunate enough to have seen my strategy deliver outstanding results throughout the years. Discipline and consistency win the game over time. Unfortunately, many investors violate their own model or strategy when their portfolio performance is temporarily disappointing. I would rather sell too late than too early, so I tend to never sell. I let my winners compound to a significant portion of my portfolio and let my losers become insignificant over time. Disclaimer: All App Economy Insights contributions to Seeking Alpha, or elsewhere on the web, are personal opinions only and do not constitute investment advice. All articles, blog posts, comments, emails, and chatroom contributions by App Economy Insights - even those including the word "recommendation" - should never be construed as official business recommendations or advice. In an effort to maintain full transparency, related positions will be disclosed at the end of each article to the maximum extent practicable. The premium service App Economy Portfolio is a research and opinion subscription. I am not registered as an investment adviser. The majority of trades are reported live, but this cannot be guaranteed due to technical constraints. Investors should always do their own due diligence and fact-check all research prior to making any investment decisions. Liability of all investment decisions reside with the individual investor. Analyst’s Disclosure: I/we have a beneficial long position in the shares of AMZN either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (111) appeconomyinsights.substack.com/... To steal imagery from When Harry Met Sally, "I'll take what they're doing!"Those are large buildings and could warehouse a lot of merchandise beyond food.Not saying it is a genius idea, but I'd think about it, Best to wait for the big sale. (2) If AMZN is a great long term investment, then buying now and holding 3-5 years will work out well. (3) If AMZN is not a great long term investment, then buying at 80 probably isn't either.Long AMZN, because I estimate that the growing component parts will be worth considerably more than the market capitalization over time. But there is uncertainty with any equity investment. If you want more certainty, consider buying a good ETF or mutual fund. WD

AMZN

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U.S. dollar rises, bitcoin sinks, Tesla and Amazon stocks under pressure

Yahoo Finance's Ines Ferre joins the Live show to break down how stocks are moving in midday trading.

Yahoo

U.S. dollar rises, bitcoin sinks, Tesla and Amazon stocks under pressure Yahoo Finance's Ines Ferre joins the Live show to break down how stocks are moving in midday trading. Video Transcript [MUSIC PLAYING] BRAD SMITH: Welcome back to "Yahoo! Finance Live," everyone. We've reached this, the top of the 10:00 AM hour. Brad Smith here in studio with Julie Hyman. Brian Sozzi on assignment, as we'll say, from home today. Happy Friday to you all here on this jobs Friday. Let's take a look at where the markets stand following that jobs report earlier, which was just a little bit hotter than expectations. We're taking a look at the Dow, the NASDAQ and the S&P 500-- all lower on the day. The Dow is lower by a little more than 480 points to the downside of about 1.6%. The S&P 500, you're also seeing that deep in the red right now by roughly 2% that looks like. And then additionally, the NASDAQ composite-- you're seeing that down by about 312 points. And taking a deeper dive into that jobs report, of course, later on in this show, we're going to have Secretary of Labor Marty Walsh going to join us momentarily to get reaction from the White House. So stay tuned for that conversation. Plus, it's jeans Friday wherever you find yourself in the world. But Levi's under pressure this morning after the denim maker cut its outlook. We're going to speak to the company's CFO to discuss its latest earnings report as you get ready to put the jorts away. And in an unprecedented move in the movie world, Netflix is set to show the "Knives Out" sequel in major theaters one month before its streaming release. We're going to discuss what that means for the streaming space. All of that and much more coming up during this 10:00 AM hour. But for much more on today's markets, let's get on over to Yahoo! Finance's Ines Ferre as we're about 30 minutes into today's trading session. Ines, on over to you. INES FERRE: And Brad, you mentioned the losses after that jobs report, and we are still seeing the S&P 500 down 2% But if we just pull up a five-day chart-- because of Monday and Tuesday's rally, we are set to end the week in the green for the major averages because of those days, if we stay at this pace. Let's see what happens throughout the day. Looking also at the 10-year Treasury note, that's higher, up seven basis points at 3.9%. We saw that 10-year Treasury yield go higher after that jobs report. Also, the U.S. Dollar Index-- that moved higher after the jobs report as well. Want to point out what's happening with Bitcoin because we did see Bitcoin moving to the downside earlier. And then looking at the sector action, we're watching the high-growth names that are really under pressure. So you're watching tech, consumer discretionary. Materials are leading to the downside. Over on the NASDAQ 100, the mega caps, as I mentioned-- Tesla down 3%. Amazon also lower. Nvidia down 5%. And the semiconductors are really seeing some pressure today after that revenue warning from AMD. Finally, I want to mention what's happening with the homebuilders because of higher interest rates and how this affects the homebuilders. Well, you're looking at them in the red right now, especially homebuilders and also companies that have to do with mortgages, guys.

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DoorDash (DASH) Introduces Feature Drinks With DoubleDash

DoorDash (DASH) unveils new feature Drinks with DoubleDash to allow customers to order food from one place and drinks from another place in the same vicinity in a single order.

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DoorDash (DASH) Introduces Feature Drinks With DoubleDash DoorDash DASH recently introduced new feature Drinks with DoubleDash, which will help customers to order food from one place and drinks from another place in the same vicinity in a single order. A single order of food and drinks from two different places will cost no additional delivery fee for the minimum order range. The newly launched feature will allow customers to order food from a restaurant and scroll to the bottom of the menu where one can browse alcohol options available from a nearby liquor convenience or grocery store. While other major local delivery logistics platforms like Uber Technologies UBER and large Internet-based companies such as Amazon AMZN are already providing alcohol to its customers, DoorDash’s recent feature is expected to attract new users to its platform and drive user growth. This is expected to drive its total orders and marketplace gross order volume (GOV) and boost e-commerce on its platform. DoorDash, Inc. Price and Consensus DoorDash, Inc. price-consensus-chart | DoorDash, Inc. Quote DoorDash Driving Top Line With Boost in Total Orders DASH is reeling under the impacts of inflation. Rising input costs due to the raging inflation are creating major headwinds. In the second quarter of 2022, DASH incurred a loss of 72 cents per share, wider than the Zacks Consensus Estimate of a loss of 39 cents. It reported a loss of 30 cents in the year-ago period. Rising expenses lowered DoorDash’s ability to maintain profitability in the past quarters. The trend is expected to persist in the coming quarters. DASH’s continued net losses affected its share price. Shares of DoorDash have slumped 64.4% year to date compared with the Zacks Internet - Services industry’s decline of 32.5%. DoorDash’s on-demand delivery service is facing extensive competition from Uber Technologies and Amazon. Uber’s delivery business is witnessing a boom with rising online order volumes. UBER is expanding its delivery operations through various acquisitions, such as Postmates. The Postmates buyout is expanding UBER’s base in Los Angeles and the American Southwest. It is also helping the company win a strong market share. Amazon is one of the world’s largest e-commerce companies with diversified product offerings. Product selection, a superior user experience, bargains and customer feedback helped AMZN build a loyal and growing customer base in the fast-growing e-commerce market. Growth in the e-commerce industry during the pandemic, with consumers increasingly buying things online, proved favorable for AMZN, which bodes well for the long haul. DASH currently carries a Zacks Rank #3 (Hold). To win a good share in a highly fragmented e-commerce market, DoorDash is consistently investing in acquisitions and expanding its partner base to fortify its footprint. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. The recent acquisition of Wolt will help DoorDash fast-track its product development, grow its international base across 26 countries, and bring a greater focus to its markets outside the United States. The acquisition of hospitality technology company Bbot will likely aid DASH’s platform with its products and technologies. This will offer merchants more solutions for their in-store and online channels, including in-store digital ordering and payments. DoorDash recently partnered with Big Lots BIG to provide customers in the United States with on-demand delivery of its bargains, treasures and home essentials. DoorDash, as part of the partnership, will deliver more than 36,000 products to customers of Big Lots, including home goods, seasonal décor, bedding, snacks and pantry staples, cleaning products, outdoor essentials and pet care supplies via the DoorDash app and website. DoorDash partnered with Albertson Companies, a food and drug retailer, to provide express grocery delivery services within 30 minutes across 20 major cities in the United States. DASH also partnered with Grocery Outlet to serve more than 1.5 million shoppers each week and provide supplies at 40-70% below retail price. The partnership will boost DASH’s total orders and marketplace GOV, aiding its top-line growth. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Big Lots, Inc. (BIG) : Free Stock Analysis Report Uber Technologies, Inc. (UBER) : Free Stock Analysis Report DoorDash, Inc. (DASH) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research

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11 Best FAANG Stocks To Buy Now

In this article, we will be taking a look at the 11 best FAANG stocks to buy now. To skip our detailed analysis of these stocks and the technology sector, you can go directly to see the 5 Best FAANG Stocks to Buy Now. In spite of the Fed jacking up interest rates, the technology sector […]

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11 Best FAANG Stocks To Buy Now In this article, we will be taking a look at the 11 best FAANG stocks to buy now. To skip our detailed analysis of these stocks and the technology sector, you can go directly to see the 5 Best FAANG Stocks to Buy Now. In spite of the Fed jacking up interest rates, the technology sector is continuing to attract investor attention in 2022. With rampant inflation still plaguing the market, the sector was expected to suffer from a loss in popularity. However, its cheaper valuation in a time of economic recession is managing to work in its favor. According to a Bloomberg article published this September, The Nasdaq 100 Index was 35% cheaper than its peak in 2020. Some of the best FAANG stocks like Apple Inc. (NASDAQ:AAPL) still continued to rake in cash and maintain their earnings outlooks, inspiring confidence as far as investors were concerned. What are FAANG stocks? The acronym FAANG refers to the top five American technology companies in the market today: Facebook (now known as Meta Platforms, Inc. (NASDAQ:META)), Amazon.com, Inc. (NASDAQ:AMZN), Apple Inc. (NASDAQ:AAPL), Netflix, Inc. (NASDAQ:NFLX), and Alphabet Inc. (NASDAQ:GOOG). With Netflix, Inc. (NASDAQ:NFLX) losing the favor of many investors with its performance this year, Microsoft Corporation (NASDAQ:MSFT) is steadily becoming a new member of this group of stocks. Investors' approach to the markets this year has demonstrated that staying away from the best FAANG stocks like Amazon.com, Inc. (NASDAQ:AMZN) and Microsoft Corporation (NASDAQ:MSFT) is not an option. The sheer size of the tech industry alone makes it the largest of its kind in the S&P 500, making up almost 27% of the index. As a result, many investors are now being pulled towards durable businesses like the FAANG stocks. According to a Reuters article published this July, Microsoft Corporation's (NASDAQ:MSFT) earnings results added to investor confidence in the tech sector, as they showed that the FAANG stocks were well-equipped to deal with a recession. Microsoft Corporation (NASDAQ:MSFT) rose by about 3.1% in July after the company mentioned it was targeting double-digit growth in fiscal revenue. Let's now take a look at the 11 best FAANG stocks to buy now. Our Methodology We have selected renowned tech stocks that are comparable to the Big Tech companies. These stocks were popular among the 895 hedge funds tracked by Insider Monkey in the second quarter of 2022. They have also reported positive latest earnings and demonstrate growth potential based on projected EPS growth, revenue growth, and free cash flow growth, among other factors. We have ranked these stocks based on the number of hedge funds holding stakes in them, from the lowest to the highest. We have also mentioned analyst ratings and price targets for these stocks. Best FAANG Stocks To Buy Now 11۔ International Business Machines Corporation (NYSE:IBM) Number of Hedge Fund Holders: 40 International Business Machines Corporation (NYSE:IBM) is an information technology company providing integrated solutions and services across the globe. The company offers hybrid cloud platform and software solutions, software for business automation, data and artificial intelligence solutions, and more. It is based in Armonk, New York. An Overweight rating was reiterated on shares of International Business Machines Corporation (NYSE:IBM) on October 6, by analyst Erik Woodring at Morgan Stanley. The analyst also placed a $152 price target on the stock. The company's revenue has grown by 27.28% year-over-year, and its EPS is expected to grow by 8.97% over the next three to five years. International Business Machines Corporation (NYSE:IBM) has a one-year dividend growth rate of 0.77% as well. Its EPS in the second quarter of 2022 was $2.31, beating estimates by $0.02. International Business Machines Corporation (NYSE:IBM) also brought in $15.54 billion in revenue, beating estimates by $359.15 million. Citadel Investment Group was the largest stakeholder in International Business Machines Corporation (NYSE:IBM) in the second quarter, holding 2.9 million shares worth about $420.9 million. In total, 40 funds were long the stock, with a total stake value of $948 million. International Business Machines Corporation (NYSE:IBM), like Amazon.com, Inc. (NASDAQ:AMZN), Apple Inc. (NASDAQ:AAPL), and Microsoft Corporation (NASDAQ:MSFT), is one of the top tech stocks hedge funds are pouring into today. 10. Intel Corporation (NASDAQ:INTC) Number of Hedge Fund Holders: 65 Intel Corporation (NASDAQ:INTC) is a semiconductor company working to design, manufacture, and sell computer products and technologies across the globe. It offers platform products like central processing units and chipsets. It is based in Santa Clara, California. Ross Seymore at Deutsche Bank has a Hold rating on Intel Corporation (NASDAQ:INTC) shares as of September 8. The analyst also placed a $35 price target on the stock. Intel Corporation (NASDAQ:INTC) has a forward dividend per share growth rate of 4.21%, and a one-year dividend growth rate of 5.17%. The company has been investing large sums in research and development, manufacturing, and packaging technologies, a move that will benefit it in the long run. This March, Intel Corporation (NASDAQ:INTC) announced plans to invest $85 billion in the above areas. In total, there were 65 hedge funds long Intel Corporation (NASDAQ:INTC) in the second quarter. Their total stake value was $2.5 billion. 9. QUALCOMM, Incorporated (NASDAQ:QCOM) Number of Hedge Fund Holders: 71 QUALCOMM, Incorporated (NASDAQ:QCOM) is a semiconductor company working to develop and commercialize foundational technologies for the wireless industry worldwide. The company operates through its Qualcomm CDMA Technologies (QCT), Qualcomm Technology Licensing (QTL), and Qualcomm Strategic Initiatives (QSI) segments. It is based in San Diego, California. On September 26, Samik Chatterjee at JPMorgan reiterated an Overweight rating on shares of QUALCOMM, Incorporated (NASDAQ:QCOM). The analyst also placed a $185 price target on the stock. QUALCOMM, Incorporated's (NASDAQ:QCOM) EPS is expected to grow by 23.02% over the next three to five years. The company's revenue has grown by 29.36% year-over-year, and its forward free cash flow per share growth rate is 50.65%. QUALCOMM, Incorporated (NASDAQ:QCOM) also has a one-year dividend growth rate of 6.08%. Analyst Chatterjee sees a substantial upside in the stock in light of the stock's current valuation. QUALCOMM, Incorporated (NASDAQ:QCOM) was found among the 13F holdings of 71 hedge funds in the second quarter, and 73 funds in the previous quarter. Their total stake values were $2.8 billion and $3.6 billion, respectively. 8. NVIDIA Corporation (NASDAQ:NVDA) Number of Hedge Fund Holders: 84 NVIDIA Corporation (NASDAQ:NVDA) is another semiconductor company providing graphics, compute, and networking solutions in the US, Taiwan, China, and internationally. It offers game streaming services and related infrastructure, solutions for gaming platforms, and automotive platforms for infotainment systems. It is based in Santa Clara, California. Joseph Moore at Morgan Stanley holds an Equal Weight rating on shares of NVIDIA Corporation (NASDAQ:NVDA) as of September 21. The analyst also maintains a $182 price target on the stock. Moore believes NVIDIA Corporation (NASDAQ:NVDA) will benefit in the near future, since gaming revenues are set to recover in 2023, seeing how prices in the sector are 28% higher than the baseline price from two year ago. NVIDIA Corporation (NASDAQ:NVDA) had revenue of $6.7 billion in the fiscal second quarter of 2023, beating estimates by $3.47 million. There were 84 hedge funds long NVIDIA Corporation (NASDAQ:NVDA) in the second quarter, with a total stake value of $3.3 billion. Of these funds, Citadel Investment Group was the largest stakeholder in the company, holding 17.7 million shares worth $2.7 billion. 7. Advanced Micro Devices, Inc. (NASDAQ:AMD) Number of Hedge Fund Holders: 87 Advanced Micro Devices, Inc. (NASDAQ:AMD) is another information technology company operating in the semiconductor industry. The company offers chipsets, discrete and integrated graphics processing units (GPUs), data center and professional GPUs, and development services, among more. It is based in Santa Clara, California. An Overweight rating was maintained on shares of Advanced Micro Devices, Inc. (NASDAQ:AMD) on October 5, placed by analyst Aaron Rakers at Wells Fargo. The analyst also placed a $90 price target on the stock. Advanced Micro Devices, Inc.'s (NASDAQ:AMD) working capital growth year-over-year stands at a rate of 61.17%. The company's EPS is expected to grow by 30.95% over the next three to five years, and its revenue has grown by 61.74% year-over-year. This October, Advanced Micro Devices, Inc. (NASDAQ:AMD) also led chip stocks higher for the third straight day of gains this month. Out of 895 funds, 87 funds were long Advanced Micro Devices, Inc. (NASDAQ:AMD) in the second quarter, with a total stake value of $4.8 billion. In comparison, 83 funds were long the stock in the previous quarter, with a total stake value of $6.9 billion. 6. Alibaba Group Holding Limited (NYSE:BABA) Number of Hedge Fund Holders: 106 Alibaba Group Holding Limited (NYSE:BABA) is an internet and direct marketing retail company operating in the consumer discretionary sector. The company provides technology infrastructure and marketing reach to help merchants, retailers, and businesses to engage with their consumer bases in China and internationally. It is based in Hangzhou, China. On October 3, Jiong Shao at Barclays kept an Overweight rating on Alibaba Group Holding Limited (NYSE:BABA) shares, while placing a $135 price target on the stock. This October, Alibaba Group Holding Limited (NYSE:BABA) led Chinese tech stocks in the broader market, rising 4.6% on October 4. The company's revenue has grown by 10.87% year-over-year, and its EPS is expected to grow by 1.74% over the next three to five years. In the fiscal first quarter of 2023, Alibaba Group Holding Limited (NYSE:BABA) had an EPS of $1.74, beating estimates by $0.18, while its $30.46 billion revenue also beat estimates by $296.3 million. Alibaba Group Holding Limited (NYSE:BABA) had 106 hedge funds long its stock in the second quarter, with a total stake value of $7.4 billion. Fisher Asset Management was the largest stakeholder in the company, holding 14.5 million shares worth $1.6 billion. Distillate Capital Partners LLC, an investment management firm, mentioned Alibaba Group Holding Limited (NYSE:BABA) in its second quarter 2022 investor letter. Here's what the company said: “Changes & Regional Weights: The largest new position is Alibaba Group Holding Limited (NYSE:BABA), which underperformed considerably and has seen its enterprise value fall by almost two thirds from its peak despite a net cash position on its balance sheet.” Alibaba Group Holding Limited (NYSE:BABA), like Amazon.com, Inc. (NASDAQ:AMZN), Apple Inc. (NASDAQ:AAPL), and Microsoft Corporation (NASDAQ:MSFT), has been on the rise in the tech sector for many year, attracting positive investor attention. Click to continue reading and see the 5 Best FAANG Stocks to Buy Now. Suggested articles: Disclosure: None. 11 Best FAANG Stocks to Buy Now is originally published on Insider Monkey.

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Amazon.com, Inc. (NASDAQ:AMZN) institutional owners may be pleased with recent gains after 27% loss over the past year

A look at the shareholders of Amazon.com, Inc. ( NASDAQ:AMZN ) can tell us which group is most powerful. The group...

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Amazon.com, Inc. (NASDAQ:AMZN) institutional owners may be pleased with recent gains after 27% loss over the past year A look at the shareholders of Amazon.com, Inc. (NASDAQ:AMZN) can tell us which group is most powerful. The group holding the most number of shares in the company, around 59% to be precise, is institutions. Put another way, the group faces the maximum upside potential (or downside risk). Last week's US$56b market cap gain would probably be appreciated by institutional investors, especially after a year of 27% losses. Let's take a closer look to see what the different types of shareholders can tell us about Amazon.com. View our latest analysis for Amazon.com What Does The Institutional Ownership Tell Us About Amazon.com? Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing. As you can see, institutional investors have a fair amount of stake in Amazon.com. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Amazon.com, (below). Of course, keep in mind that there are other factors to consider, too. Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. Amazon.com is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Jeffrey Bezos with 9.8% of shares outstanding. With 6.8% and 5.8% of the shares outstanding respectively, The Vanguard Group, Inc. and BlackRock, Inc. are the second and third largest shareholders. A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority. While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too. Insider Ownership Of Amazon.com While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it. Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group. We can report that insiders do own shares in Amazon.com, Inc.. Insiders own US$120b worth of shares (at current prices). we sometimes take an interest in whether they have been buying or selling. General Public Ownership The general public-- including retail investors -- own 31% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies. Next Steps: While it is well worth considering the different groups that own a company, there are other factors that are even more important. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Amazon.com (of which 1 makes us a bit uncomfortable!) you should know about. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future. NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Join A Paid User Research Session You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here

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Is Rivian Automotive Stock a Buy Now?

Rivian (NASDAQ: RIVN) stock jumped 14% on Oct. 4 after the electric truck, SUV, and van maker posted its latest production numbers. In the third quarter, it produced 7,363 vehicles and delivered 6,584 vehicles. Its production volume hit 14,317 vehicles in the first nine months of 2022, and it also reaffirmed its full-year production target of 25,000 vehicles.

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Is Rivian Automotive Stock a Buy Now? Rivian (NASDAQ: RIVN) stock jumped 14% on Oct. 4 after the electric truck, SUV, and van maker posted its latest production numbers. In the third quarter, it produced 7,363 vehicles and delivered 6,584 vehicles. Its production volume hit 14,317 vehicles in the first nine months of 2022, and it also reaffirmed its full-year production target of 25,000 vehicles.

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'The month of unprecedented deals' — From Amazon to Target, here's what you need to know about the early holiday sales going on now

Retailers are kicking off a slew of holiday deals earlier than ever before. Here's a rundown of some of sales events happening now.

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'The month of unprecedented deals' — From Amazon to Target, here's what you need to know about the early holiday sales going on now - Amazon's "Prime Early Access Sale" kicks off Oct. 11. - But the best deals may not be exclusive to Amazon; other retailers are launching their own holiday sales this month, as well. - Here's a look at what's happening now. Amazon's two-day "Prime Early Access Sale" starts soon, spurring a number of holiday deals coming earlier than ever before. "October is really going to be the month of unprecedented deals," said Deborah Weinswig, the founder and CEO of Coresight Research. Indigenous People's Day or Columbus Day — this year, Oct. 10 — may as well be the new Black Friday, she added. "Don't wait." More from Personal Finance: Americans are suffering from 'recession fatigue' Inflation and higher rates are a 'dangerous mix' These steps can help you tackle stressful credit card debt Amazon's Prime Early Access sale: What's in store When Amazon's sale kicks off Oct. 11, expect to find the best discounts on Amazon devices, such as the Kindle, Echo and Fire TV streamer, and its private-label clothing, according to Julie Ramhold, a consumer analyst at DealNews.com. Already, Amazon said the Fire 55-inch 4K Smart TV with hands-free Alexa would be 80% off and some Echo devices would be discounted by 55%. Beyond Amazon's own brands, other deals include half off earbuds, speakers and headphones from Sony and Bose, some laptops from Dell and HP marked down 35%, Solo Stove fire pits for 30% off and 15% off Peloton bikes. (NBC's Select has a full roundup of best early Amazon Prime Day deals to shop now.) Unlike July's Prime Day, Amazon is featuring more gift suggestions this month — with more deals on well-known brands, such as Hasbro, Lego, Barbie and Sony — rather than household goods. "They will try to hit all of the big holiday gifts: home decor, apparel, name brand accessories and toys, toys, toys," said Casey Runyan, managing editor at online discount marketplace Brad's Deals. "The summer Prime Day was very toothpaste; that's not the same as buying that great kitchen appliance or hot toy," Runyan added. Even the Amazon coat is back and marked down 30%. New deals will drop every 30 minutes. When a deal is live, add the item to your cart immediately. Some items will sell out quickly, Ramhold said. However, in order to take advantage of Prime Day deals, you must be an Amazon Prime member. You can sign up for a month-to-month membership or a 30-day free trial. Deal hunters should be wary of the monthly promotion, Ramhold cautioned, since it won't extend to Black Friday. "By hosting this Prime Day event in October, Amazon has effectively assured that people will have to pay if they want to shop in November," Ramhold said. The annual Prime membership also comes with a catch, since the retail giant raised the price to $139 from $119 earlier this year. Target, Walmart, other competitors kick off early sales The best bargains are not exclusive to Amazon; other big names are launching their own holiday sales this month, as well. "Retailers in all categories are taking advantage of the fact that shoppers are in the market for deals during this time to create their own events to move inventory and win volume from Amazon," said Rakuten's retail and shopping expert Kristen Gall. Here's a look at some of other sales events happening now. - Target's "Deal Days" started Oct. 6, with daily deals across all categories including furniture, electronics, beauty, apparel, toys and sporting goods. Shoppers also have the benefit of the retailer's price-match guarantee, which means purchases made between Oct. 6 and Dec. 24 can qualify for a price adjustment if the Target price drops any lower before Christmas Eve. - Walmart is holding a "Rollbacks and More" event from Oct. 10 to 13, which will start before and end after Amazon's sale and include discounts on top gifts and electronics, home, toys and clothing. - Macy's "Fab Fall" sale runs through Oct. 10, with savings up to 60% and additional bonus cash for loyalty members. - Kohls has its two-day Deal Dash on Oct. 11 and 12, with an extra 20% off already reduced merchandise. - Bed, Bath & Beyond's fall savings event is underway, with markdowns up to 50% on almost everything plus an additional 20% off one item and $15 off a purchase over $50. With sales starting earlier, retailers are hoping to lure shoppers with promotions well ahead of Black Friday and Cyber Monday, as consumers become increasingly concerned about higher prices. In fact, many consumers have already started their holiday gift buying, studies show — and nearly 1 in 3 will shop this round of the Prime sale, according to a recent report by market research firm Numerator. Fears that prices will only go up from here has motivated more people, a separate report by the National Retail Federation found. Roughly 44% of shoppers said it is better to purchase gifts now, because those items could be more expensive before the end of the year. How to get the best deals on holiday gifts To maximize your holiday savings, start price tracking now. Ramhold recommends creating a wish list and then using a price-tracking browser extension such as Camelcamelcamel or Keepa to keep an eye on price changes and get price-drop alerts for the items you want. "Once you have an idea of what they're charging now, you'll be able to tell much easier whether something is a really good deal," Ramhold said. That may also depend heavily on the type of item, Runyan added. "Deals vary a lot depending on the category," she said. "For electronics, 10% off is good; with apparel and accessories, the margins are much greater, so there's more room to discount." "For extra savings, apply promo codes or digital coupons, and use a rewards credit card to [earn extra] points or cash back," Gall said.

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Silicon Valley VC has been investing in climate tech for a decade — here's what he's into now

Long-time Silicon Valley investor and DCVC co-founder Zack Bogue shares why he's investing in climate tech and what areas are especially interesting to him.

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Silicon Valley VC has been investing in climate tech for a decade — here's what he's into now - Zachary Bogue co-founded the Silicon Valley venture capital firm DCVC in 2011 and since then, he and his co-founder Matt Ocko have invested in scores of companies that have gone public or been acquired. - DCVC invests in climate to make money, not out of a social manifesto. - Areas of climate tech investing that Bogue is especially excited about right now include advanced nuclear, water conservation, methane reduction, and geothermal. Zachary Bogue co-founded the Silicon Valley venture capital firm DCVC in 2011. Since then, he and co-founder Matt Ocko have invested in scores of companies that have gone public or been acquired by companies like Google, Twitter, Amazon and Microsoft. DCVC invests in algorithmic finance, cybersecurity, smart agriculture, space access and intelligence, and climate resilience technology. While investing in climate technology serves a social benefit, DCVC is not investing for ideological reasons. To the contrary. "There's a bucket of investing that we will just call ethical investing, and that's where folks are investing in things they know they should be investing in, or not investing in things they know they shouldn't be investing in, and they are doing that for ethical or moral reasons," Bogue told CNBC in an interview late last month. "In exchange for doing that, they are willing to accept a lower rate of return. We do not do that." Bogue added, "My LPs are big institutions — college endowments, big charitable trusts that run hospitals," referring to the venture capital firm's limited partners, or investors. "They give me money. And unless I give them back a return on that money, they aren't able to operate their hospitals. So we take the profit motive, and the return motive very seriously at DCVC." There's a lot of these trillion-dollar problems out there in the climate space. And if you can solve them, you can create a huge positive impact for the world while building a large, successful capitalist company.Zack BogueCo-founder DCVC The thesis for all of DCVC's investing is backing entrepreneurs who are solving trillion-dollar problems with computational power. "There's a lot of these trillion-dollar problems out there in the climate space. And if you can solve them, you can create a huge positive impact for the world while building a large, successful, capitalist company," Bogue told CNBC. "The goal is to build build large, successful public companies." When looking at a climate tech investments, DCVC does the exact same kind of due diligence it would do on any other deal, Bogue told CNBC. "There's no free pass because someone happens to be solving a hard problem in climate rather than a hard problem in robotics or with a satellite or in biotech," Bogue told CNBC. "They all need to meet sort of our internal high bar in underwriting those deals." That's not to say that Bogue is indifferent to climate change. He grew up in Denver, where daily life is defined by proximity to nature, and studied environmental science and public policy at Harvard. And DCVC has been investing in climate tech since 2012, long before it became trendy. That first climate investment was in TempoDB, which did a type of time series database for, among other things, geothermal energy. "We've been quietly investing in the climate for a decade and trying not to talk too much about it," Bogue told CNBC. "Relatively recently, it became socially acceptable to talk about." The amount of money going into climate tech has certainly been on the rise, according to a report from PricewaterhouseCoopers. In the year ended June 30, 2021, $87.5 billion in venture capital and private equity went into climate tech, up 210 percent from the previous 12-month period. In the most recent year, more than $60 billion of that $87.5 billion came in the first six months of 2021. Deals are getting bigger in the space, too. In the first six months of 2021, the average climate tech deal was $96 million, up from $27 million in the same six months of 2020. Hot climate topics for DCVC: Nuclear, water, methane and geothermal Bogue is interested in investing in nuclear energy. But because DCVC has total assets under management of about $3 billion — much less than it costs to construct a conventional large-scale nuclear power plant — the firm invests in capital-light nuclear companies. One example is Oklo, which is planning to build micro-nuclear reactors. If its plans pan out, it will be able to fund its further growth with revenue that comes in from power purchase agreements, Bogue said. "Advanced nuclear fission is a quintessential deep tech venture capital problem," Bogue told CNBC. There is technical and regulatory risk, but if those problems are solved, "there are just massive-scale returns... all of those elements are a perfect recipe for venture capital." Water conservation technology is another big focus. "Water is rapidly coming to the fore as a as a climate problem. And as a deep tech-addressable problem," Bogue said. For example, DCVC led a recent investment in ZwitterCo, a wastewater reprocessing startup which is working to scale up its membrane technology which allows industrial companies and large farms to recycle their wastewater, allowing them to use less fresh water. Bogue is also very interested in finding solutions to minimize methane emissions. Methane is vastly more potent than carbon dioxide in its impact on global warming, but it does not persist nearly as long in the atmosphere as carbon dioxide. "If you can stop methane leaking, in climate terms, it has an immediate positive impact. So if we can stop all of the human-caused methane, it can buy us years to get our act together on other climate problems that it will take longer to perfect," Bogue told CNBC. Kairos Aerospace, a company DCVC has invested in, images methane leaks through aerial surveys conducted on fixed wing aircraft and provides data about leaks to oil and gas companies. "This is a very low hanging fruit and easily addressable problem with huge impact," Bogue said. DCVC has also invested in CH4 Global, a company which is working to grow the aquaculture ecosystem for Asparagopsis seaweed, a seaweed that grows natively in Australian and New Zealand. CH4 is taking the particular seaweed and making it into a supplement to put in the food of ruminants, including cows, goats, sheep, and deer so that they release less methane with their belching. One other area of climate tech investing Bogue mentioned is geothermal, which is heat generated from the core of the Earth. DCVC recently led a $138 million round of funding in Fervo, which counts the tech giant Google as a customer. Much of the same geology and engineering talent that is currently used by the oil and gas industry can potentially transfer those skills over to geothermal, said Bogue. And unlike renewables, which generate energy only when the sun is shining or the wind is blowing, geothermal is a baseload, 24x7 power source.

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S&P 500 Weekly Earnings Update: Big Week For MegaCap Tech

The top 4 names in the S&P 500 report their calendar Q3 ’22 earnings this week, although for Apple it’s their fiscal Q4 ’22.

SeekingAlpha

S&P 500 Weekly Earnings Update: Big Week For MegaCap Tech Summary - The top 4 names in the S&P 500 report their calendar Q3 ’22 earnings this week, although for Apple it’s their fiscal Q4 ’22. - The forward 4-quarter estimate slid sequentially again this week to $232.61 from the prior week's $233.02. The forward 4-quarter estimate (FFQE) has now only increased sequentially 3 times in the last 17 weeks. - The PE ratio is now 16x vs 15.4x last week thanks to the 5% weekly gain for the S&P 500. The top 4 names in the S&P 500 report their calendar Q3 ’22 earnings this week, although for Apple (AAPL) it’s their fiscal Q4 ’22. These four names comprise about 20% of the S&P 500’s market cap as of the close of trading last night, Thursday, October 20, ’22. This blog will be out with a preview of all 4 names – probably on Sunday – but here’s the weekly update for S&P 500 EPS numbers, sourced from IBES data by Refinitiv. (Meta (META) reports this week too, although it’s market cap rank has fallen to 15th in the S&P 500 as of last night.) These three graphs should be interesting to readers since it’s the S&P 500 “net income” and not EPS which leads me to think the Refinitiv title is a little misleading to readers. While it’s horrible nit-picking, “earnings per share” is not net income, although “earnings” is net income. - The bottom graph is the trend in quarterly net income for Q1 ’22 earnings, as of 4/22/22. - The middle graph is the trend in quarterly net income for Q2 ’22 earnings, as of 7/22/22. - The top graph is the trend in quarterly net income for Q3 ’22 earnings as of 10/24/22. The point being – excluding the impact of fully diluted shares outstanding – readers can see the noticeable slowing in earnings or net income graphically as 2022 has progressed. As my old boss used to ask, “What’s the point?” The point is we see a whole lot of net income or earnings this week with Apple, Amazon (AMZN), Microsoft (MSFT) and Alphabet (GOOG) (GOOGL), not to mention Meta reporting their Q3 ’22 calendar results. Here’s the list of report dates this coming week: - Tuesday, 10/25: Alphabet and Microsoft (AMC) - Wednesday, 10/26: Meta (AMC) - Thursday, 10/27: Apple and Amazon (AMC) AMC – after market close S&P 500 data: - The forward 4-quarter estimate slid sequentially again this week to $232.61 from the prior week's $233.02. The forward 4-quarter estimate (FFQE) has now only increased sequentially 3 times in the last 17 weeks. - The PE ratio is now 16x vs 15.4x last week thanks to the 5% weekly gain for the S&P 500. - The S&P 500 earnings yield fell to 6.2% this week from 6.5% last week. The 10-year Treasury yield increased 20 basis points (bps) this week and 42 bps since 9/30/22 and yet the S&P 500 still has a slight gain in October, month-to-date. That’s an interesting tell. Rate of change update: The interesting thing about this week is that all 3 “rates of change” buckets i.e. sequential, 4-week and 12-week improved this week versus last week, and the energy reports from Friday morning, 10/24, like Schlumberger (SLB) are not yet in the numbers. Summary/conclusion: The interesting thing about this week’s trade wasn’t just the 5% pop in the S&P 500, but that the S&P 500 is rising in the face of a 20 bp increase in the 10-year Treasury yield and is still up month-to-date after a 42 bp increase in the 10-year Treasury yield. That’s a change in character and investors have to sit up and take note when relationships like that change. Also, the S&P 500 closed at 3,674 the week of June 17th, 2022, when the S&P 500 printed that June ’22 low of 3,636 (various guests on CNBC keep saying 3,666, which is not right) and this week closed at 3,752.75. The 10-year Treasury yield spiked to 3.50% with the 3,636 low in mid-June ’22, and is now at 4.22% and yet the S&P 500 is flat. The equity market is either predicting a turn in the inflation stats to reflect lower inflation or more downside is ahead for the S&P 500. The fact that the S&P 500 looks like it’s been bottoming for 4 months should tell investors which way I’m leaning in terms of “higher” or “lower” stock prices. Still, a lot depends on how these key earnings reports for what is 20% of the S&P 500 market cap in 5 names turns out. Meta fascinates me in the sense that it’s trading at 5x cash flow (ex balance sheet cash) and 8x free cash flow and yet is still the 15th largest name in the S&P 500 by market cap. Some select clients have very small positions but it’s now entering “deep value” territory. Who’d have ever thought we’d be talking about Meta at a 2.7x book value valuation. Has growth become too cheap? Has value become too expensive? For Q3 ’22 earnings so far, the actual results are better than the poor sentiment we saw approaching earnings (again). The plan is to write a lot more over the weekend but sometimes life gets in the way. There is a definite preview of the big tech companies reporting this week coming Saturday or Sunday. Take everything written here with a healthy dose of skepticism. Past performance is no guarantee of future results and none of this is recommendation to buy, sell or hold anything, although the goal is to give the reader some sense of how I’m approaching certain market themes, which readers are free to follow or not. IBES data by Refinitiv is the primary data source for S&P 500 earnings while Briefing.com is the primary source of economic data and economic releases. Markets and opinions can change quickly for better or worse and this blog may not be updated. Thanks for reading. More to come this weekend. Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors. This article was written by Comments (13) Thanks for the article !!! JC The stomach - grumbling. The money system - no longer cheap The gubmint - dysfunctional and uncaring. The future - non-existent. My defense stocks have done exceedingly well - LMT, NOC, BAE Systems. The world is going to re-arm majorly in this decade. The walls are coming up and the magazines being loaded. Maybe cause it's a blog,or maybe not..Have a good one !!

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Weekly Roundup

The volatile week ended with a rally that gave most our positions a boost, but we made no new trades and added no new names to the portfolio.

Yahoo

Weekly Roundup The volatile week ended with a rally that gave most our positions a boost, but we made no new trades and added no new names to the portfolio. The volatile week ended with a rally that gave most our positions a boost, but we made no new trades and added no new names to the portfolio.

AMZN

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Amazon creates exclusive Thursday Night Football experience for randomly selected Valley fans

This very unique and very expensive experience was completely covered by Amazon, and the participants were chosen somewhat randomly – Amazon said they were Prime members who lived in the Valley and who added Thursday Night Football to their Prime Video Watchlist.

Yahoo

Amazon creates exclusive Thursday Night Football experience for randomly selected Valley fans This very unique and very expensive experience was completely covered by Amazon, and the participants were chosen somewhat randomly – Amazon said they were Prime members who lived in the Valley and who added Thursday Night Football to their Prime Video Watchlist.

AMZN

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1 Growth Stock Down 78% That Could Drop Further: Here's Why It's a Buy Anyway

One company that could continue to experience challenging times in the near term is Shopify (NYSE: SHOP). The possibility of a recession will affect the company in several ways. The company's revenue is somewhat linked to its gross merchandise volume (GMV), or the total value of transactions conducted on its platform.

Yahoo

1 Growth Stock Down 78% That Could Drop Further: Here's Why It's a Buy Anyway One company that could continue to experience challenging times in the near term is Shopify (NYSE: SHOP). The possibility of a recession will affect the company in several ways. The company's revenue is somewhat linked to its gross merchandise volume (GMV), or the total value of transactions conducted on its platform.

AMZN

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Hawaiian Airlines stock jumps after sealing cargo operations deal with Amazon

Yahoo Finance anchors discuss a new partnership between Hawaiian Airlines and Amazon.

Yahoo

Hawaiian Airlines stock jumps after sealing cargo operations deal with Amazon Yahoo Finance anchors discuss a new partnership between Hawaiian Airlines and Amazon. Video Transcript DAVE BRIGGS: My play is Hawaiian Airlines who Amazon has now hired to fly the first Airbus cargo planes in the retail giant's air network. Hawaiian will fly at least 10 Airbus A330-300 converted freighters for Amazon starting in the fall of 2023. Now the Airbus Jets will be the largest in Amazon's fleet and will replace older aircraft. Amazon currently outsources to Atlas Worldwide Holdings, ATSG, and Sun Country, which fly mainly Boeing Jets. Under the agreement, Hawaiian is issuing warrants for Amazon to acquire up to 15% of its stock, exercisable over the next nine years. Hawaiian will also hire pilots and additional mechanics as well. Hawaiian stock up more than 10% on this news, but still down more than 18% year to date. Amazon is up also more than 3%. After a string of strong airlines earnings, Hawaiian will report on Tuesday. One interesting thing we've seen from earnings from Amazon-- from American to Delta to United, Jared, is, every CEO has talked about the new norm in travel, which is people combining business with pleasure travel. All three of them seeing it widely. It should be interesting to see if that's a new norm or just a minor reflection of remote work. JARED BLIKRE: I really want to jump in on this bandwagon. So a note to my superiors here, I am down to fly to wherever, as long as it is a coastal destination with good weather right now. DAVE BRIGGS: And work. JARED BLIKRE: And work. Yeah, work related, obviously. Work. SEANA SMITH: I was going to say, I don't even know how to follow up with that. You're really throwing that out there. I like it a lot. But let's head back to Hawaiian and what we could hear next week because there was an interesting note out from Deutsche Bank on the heels of this announcement, saying that Amazon's business will not only improve Hawaiian's revenue diversification, but it's also going to help alleviate the earnings volatility that we tend to see when it comes to Hawaiian's business. So Deutsche Bank saying it's very positive. You mentioned the fact that they are negative year to date. We'll take a-- yeah, I guess get a better look at those numbers next week.

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Costco union workers land first nationwide contract, Teamsters say

The Teamsters union on Friday said it had ratified its first-ever nationwide contract at Costco Wholesale Corp. — a master agreement the union said offered...

MarketWatch

The Teamsters union on Friday said it had ratified its first-ever nationwide contract at Costco Wholesale Corp. COST, +0.50% — a master agreement the union said offered better pay and other benefits to more than 18,000 workers across the U.S. The agreement provides “significant wage improvements over the next three years and a substantial increase in pension contributions by the employer,” the union said. The contract also secured higher semi-annual bonuses and a “more flexible” attendance policy, according to a release. The union said 72% voted in favor of the agreement, which comes after Costco union members in June rejected an earlier contract offer. Mike Bergen, chair of the Teamsters Costco National Negotiating Committee, said in the release that workers “weren’t afraid to strike if necessary, and the company knew they weren’t bluffing.” Costco was not immediately available for comment. The announcement follows other union drives at Amazon.com Inc. AMZN, +1.30%, Starbucks Corp. SBUX, +0.97% and other retailers.

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A Major Passenger Airline Will Start Flying Amazon Orders

On Friday, shares of Hawaiian Airlines parent company Hawaiian Holdings jumped after the airline announced that it reached a deal with Amazon to operate 10 leased freighter jets to transport orders. The Airbus A330-30 planes, which will start coming into service in 2023 and 2024, will be used for what the companies call a variety of Amazon "business needs"--this could be anything from Amazon Prime One-Day delivery to moving items between suppliers and warehouses. Due to Hawaii's isolation from the rest of the country, Hawaiian Airlines has a long history of doubling as a freight airline.

Yahoo

A Major Passenger Airline Will Start Flying Amazon Orders On Friday, shares of Hawaiian Airlines parent company Hawaiian Holdings jumped after the airline announced that it reached a deal with Amazon to operate 10 leased freighter jets to transport orders. The Airbus A330-30 planes, which will start coming into service in 2023 and 2024, will be used for what the companies call a variety of Amazon "business needs"--this could be anything from Amazon Prime One-Day delivery to moving items between suppliers and warehouses. Due to Hawaii's isolation from the rest of the country, Hawaiian Airlines has a long history of doubling as a freight airline.

AMZN

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12 Best Small Cap Ecommerce Stocks to Buy

In this article, we discuss 12 best small cap ecommerce stocks to buy. If you want to read about some more small cap ecommerce stocks, go directly to 5 Best Small Cap Ecommerce Stocks to Buy. The global ecommerce sector is dominated by big names such as Amazon.com, Inc. (NASDAQ:AMZN), Alibaba Group Holding Limited (NYSE:BABA), […]

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12 Best Small Cap Ecommerce Stocks to Buy In this article, we discuss 12 best small cap ecommerce stocks to buy. If you want to read about some more small cap ecommerce stocks, go directly to 5 Best Small Cap Ecommerce Stocks to Buy. The global ecommerce sector is dominated by big names such as Amazon.com, Inc. (NASDAQ:AMZN), Alibaba Group Holding Limited (NYSE:BABA), and PayPal Holdings, Inc. (NASDAQ:PYPL). Despite these brands dominating the space, there are several lesser known companies in the industry that offer the same bang for the buck. As global ecommerce sales remain on track to reach 27% of retail sales by 2026, despite macro headwinds and recession fears, investors should take notice of these small cap growth stocks. A recent report by investment bank Morgan Stanley reveals that even in countries where online shopping is already popular, ecommerce will continue to gain further market share. For example, in parts of Southeast Asia and Latin America, ecommerce could grow 17% and 20%, respectively, over the next five years and compound annually. In South Korea, the sector could grow an astonishing 45% in the next five years, driven by food delivery and same-day options, as well as other innovations. Even in the United States, ecommerce could reach 31% of sales by 2026, up from 23% now, as brick-and-mortar stores close and consumers prioritize convenience. Andrew Ruben, an analyst covering retail and ecommerce in Latin America, believes that digital sales are growing across new verticals such as beauty, apparel, and grocery. He has said that even though there are headwinds in certain countries and verticals, there was a strong belief in the industry that these barriers will continue to come down. Our Methodology The companies that operate in the ecommerce sector and have market capitalizations between $200 million and $2 billion were selected for the list. The analyst ratings of these firms and the latest updates related to them are also discussed to provide some additional context. Data from around 900 elite hedge funds tracked by Insider Monkey in the second quarter of 2022 was used to identify the number of hedge funds that hold stakes in each firm. Denys Prykhodov / Shutterstock.com Best Small Cap Ecommerce Stocks to Buy 12. Newegg Commerce, Inc. (NASDAQ:NEGG) Number of Hedge Fund Holders: 3 Newegg Commerce, Inc. (NASDAQ:NEGG) operates as an electronics-focused e-retailer in North America. It is one of the best ecommerce stocks to invest in. On October 7, Newegg Commerce revealed the launch of the Newegg Creator. It is the first formal influencer program of Newegg. Newegg Creator will focus on influencer and content creators’ passion about video games, tech, and lifestyle brands. At the end of the second quarter of 2022, 3 hedge funds in the database of Insider Monkey held stakes worth $198,000 in Newegg Commerce, Inc. (NASDAQ:NEGG), compared to 3 in the previous quarter worth $417,000. Just like Amazon.com, Inc. (NASDAQ:AMZN), Alibaba Group Holding Limited (NYSE:BABA), and PayPal Holdings, Inc. (NASDAQ:PYPL), Newegg Commerce, Inc. (NASDAQ:NEGG) is one of the best ecommerce stocks to buy according to elite investors. 11. Liquidity Services, Inc. (NASDAQ:LQDT) Number of Hedge Fund Holders: 12 Liquidity Services, Inc. (NASDAQ:LQDT) provides e-commerce marketplaces, self-directed auction listing tools, and value-added services. It is one of the top ecommerce stocks to invest in. On October 19, Zero Hash, a subsidiary of Liquidity Services, announced that it has collaborated with Current, a leading US financial technology platform, to provide access to its 4 million members for no fee crypto trading. At the end of the second quarter of 2022, 12 hedge funds in the database of Insider Monkey held stakes worth $46 million in Liquidity Services, Inc. (NASDAQ:LQDT), compared to 9 in the previous quarter worth $56.4 million. 10. ChannelAdvisor Corporation (NYSE:ECOM) Number of Hedge Fund Holders: 13 ChannelAdvisor Corporation (NYSE:ECOM) provides software-as-a-service (SaaS) solutions in the United States and internationally. It is one of the premier ecommerce stocks to invest in. On September 6, CommerceHub stated that it has made a definitive agreement to acquire shares of ChannelAdvisor Corporation for $23.10 per share. The transaction was led by the global investor and current shareholder of CommerceHub, Insight Partners. On September 7, investment advisory Baird maintained a Neutral rating on ChannelAdvisor Corporation (NYSE:ECOM) stock and raised the price target to $23 from $17. Analyst Colin Sebastian issued the ratings update. Among the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Driehaus Capital is a leading shareholder in ChannelAdvisor Corporation (NYSE:ECOM), with 594,049 shares worth more than $8.7 million. In its Q2 2022 investor letter, Diamond Hill Capital Management, an asset management firm, highlighted a few stocks and ChannelAdvisor Corporation (NYSE:ECOM) was one of them. Here is what the fund said: “ChannelAdvisor Corporation (NYSE:ECOM) sells cloud-based software to the retail sector to manage online marketplace listings and support other e-commerce functions. The company has been successful in moving upmarket to target larger customers. Based on the notable discount ChannelAdvisor trades at relative to comparable software M&A transactions in recent years, we believe the market continues to undervalue its long-term fundamentals.” 9. ContextLogic Inc. (NASDAQ:WISH) Number of Hedge Fund Holders: 13 ContextLogic Inc. (NASDAQ:WISH) operates as a mobile ecommerce company in Europe, North America, South America, and internationally. It is one of the elite ecommerce stocks to invest in. On October 17, ContextLogic announced the launch of the second phase of its global integrated brand marketing with new Forced Smiles creative ad campaign to support its rebrand. Forced Smile was developed in a partnership with ad agency Whale. Among the hedge funds being tracked by Insider Monkey, Toronto-based investment firm Maple Rock Capital is a leading shareholder in ContextLogic Inc. (NASDAQ:WISH), with 13.5 million shares worth more than $21.6 million. 8. Poshmark, Inc. (NASDAQ:POSH) Number of Hedge Fund Holders: 15 Poshmark, Inc. (NASDAQ:POSH) operates as a social marketplace for new and second-hand style products in the United States, Canada, India, and Australia. It is one of the major ecommerce stocks to invest in. On October 4, Naver, a South Korean online platform, said that it will acquire all issued and outstanding shares of Poshmark for $17.90 in cash with an enterprise value of approximately $1.2 billion. On August 15, Barclays analyst Trevor Young upgraded Poshmark, Inc. (NASDAQ:POSH) stock to Overweight from Equal Weight with a price target of $17, up from $13, noting that the company was navigating ad-targeting post IDFA and continues to ramp as a percentage of revenue. At the end of the second quarter of 2022, 15 hedge funds in the database of Insider Monkey held stakes worth $78 million in Poshmark, Inc. (NASDAQ:POSH), compared to 23 the preceding quarter worth $82.6 million. In its Q2 2022 investor letter, MPE Capital, an asset management firm, highlighted a few stocks and Poshmark, Inc. (NASDAQ:POSH) was one of them. Here is what the fund said: “Two (very) costly mistakes I’ve made over the last twelve months have been my investments in Altice USA and Poshmark, Inc. (NASDAQ:POSH). Both are down over 50% from my initial purchase price. I not only poorly appraised business quality; I also incorrectly appraised the intrinsic value of both of these companies. It should rarely end up the case that we pay over intrinsic value, at worst case we should never lose money on an investment. One serious risk is the huge amount of leverage and the possibility of prolonged inflation leading to higher rates. They don’t have any major debt maturities coming due for a few years, but it’s possible that rates are much higher then and they have issues refinancing at favorable terms or at all. I’ve always detested companies with too much leverage not sure why I didn’t consider this enough upon my initial analysis. I guess I figured it’s a stable business that can handle some leverage. However, a business with a lot of leverage will always be at the mercy of capital markets, a fact I can’t ever feel very comfortable with. In summary, I overstated steady state free cash flows, poorly appraised their value proposition versus peers, didn’t consider new entrants and technologies thoroughly enough, and I didn’t consider the risk of rising inflation and rates. I think once they fiberize their footprint and if they can bring their leverage down, and it’s clear that new entrants aren’t having much effect on their business, Altice might only then be a decent investment candidate.” 7. BARK, Inc. (NYSE:BARK) Number of Hedge Fund Holders: 16 BARK, Inc. (NYSE:BARK) is a dog-centric company that provides products, services, and content for dogs. It is one of the major ecommerce stocks to invest in. On October 18, Bark revealed the expansion of its breed specific food offering to include seven dog breeds. In addition, the company is launching food tailored to puppies to ensure the healthy growth of dogs from a young age. At the end of the second quarter of 2022, 16 hedge funds in the database of Insider Monkey held stakes worth $12 million in BARK, Inc. (NYSE:BARK), compared to 20 the preceding quarter worth $15.8 million. 6. BigCommerce Holdings, Inc. (NASDAQ:BIGC) Number of Hedge Fund Holders: 17 BigCommerce Holdings, Inc. (NASDAQ:BIGC) operates a software-as-a-service platform for small businesses, mid-markets, and large enterprises internationally. It is one of the best ecommerce stocks to invest in. On September 15, BigCommerce announced its partnership with CoinPayments and BitPay which will offer crypto currency payments for its merchants in some countries. This digital currency supports over 100 crypto wallets. Merchants will accept tokens such as dogecoin, ethereum, bitcoin cash, and shiba etc. On October 18, Barclays analyst Raimo Lenschow maintained an Equal Weight rating on BigCommerce Holdings, Inc. (NASDAQ:BIGC) stock and lowered the price target to $18 from $20, noting that the current uncertain outlook favors cash flow positive, established software vendors. At the end of the second quarter of 2022, 17 hedge funds in the database of Insider Monkey held stakes worth $302.9 million in BigCommerce Holdings, Inc. (NASDAQ:BIGC), compared to 28 in the previous quarter worth $344.8 million. Along with Amazon.com, Inc. (NASDAQ:AMZN), Alibaba Group Holding Limited (NYSE:BABA), and PayPal Holdings, Inc. (NASDAQ:PYPL), BigCommerce Holdings, Inc. (NASDAQ:BIGC) is one of the best ecommerce stocks to buy according to elite investors. In its Q2 2022 investor letter, Polen Capital, an asset management firm, highlighted a few stocks and BigCommerce Holdings, Inc. (NASDAQ:BIGC) was one of them. Here is what the fund said: “Finally, we sold BigCommerce Holdings, Inc. (NASDAQ:BIGC) due to clear Flywheel violations. We are concerned about the company’s deteriorating profitability and reliance on external sources of capital. BigCommerce is facing numerous challenges including developer resources in Ukraine and the potential for staffing challenges in a still challenging labour market for engineers.” Click to continue reading and see 5 Best Small Cap Ecommerce Stocks to Buy. Suggested Articles: Disclosure. None. 12 Best Small Cap Ecommerce Stocks to Buy is originally published on Insider Monkey.

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Cramer’s week ahead: Earnings season heats up and companies could 'keep flying' barring a severe slowdown

CNBC's "Mad Money host" Jim Cramer on Friday told investors that stocks will likely continue to do well as long as the economy holds up.

CNBC

Cramer’s week ahead: Earnings season heats up and companies could 'keep flying' barring a severe slowdown - CNBC's Jim Cramer on Friday told investors that stocks will likely continue to do well as long as the economy holds up. - "Many companies have battened down the hatches, so to speak, and prepped for a recession. So if we don't get a severe slowdown, they will indeed keep flying," the "Mad Money" host said. CNBC's Jim Cramer on Friday told investors that stocks will likely continue to do well as long as the economy holds up. "Many companies have battened down the hatches, so to speak, and prepped for a recession. So if we don't get a severe slowdown, they will indeed keep flying," he said. He also previewed next week's slate of earnings. All earnings and revenue estimates are courtesy of FactSet. Monday: Logitech - Q2 2023 earnings release at 9 p.m. ET; conference call on Tuesday at 8:30 a.m. ET - Projected EPS: 85 cents - Projected revenue: $1.2 billion Cramer said the stock could take a hit because of the slowdown in the PC market. Tuesday: Halliburton, Coca-Cola, Alphabet, Microsoft - Q3 2022 earnings release at 6:45 a.m. ET; conference call at 9 a.m. ET - Projected EPS: 56 cents - Projected revenue: $5.34 billion Halliburton's stock could soar after it reports earnings, he predicted. - Q3 2022 earnings release at 6:55 a.m. ET; conference call at 8:30 a.m. ET - Projected EPS: 64 cents - Projected revenue: $10.52 billion Cramer said he expects the company to have a strong quarter, similar to Pepsi-Co's. - Q3 2022 earnings release at 4 p.m. ET; conference call at 5 p.m. ET - Projected EPS: $1.27 - Projected revenue: $71.08 billion The Google parent company will likely report a solid quarter due to the strength of YouTube, he predicted. - Q1 2023 earnings release at 4:05 p.m. ET; conference call at 5:30 p.m. ET - Projected EPS: $2.31 - Projected revenue: $49.66 billion Cramer said he expects the stock to jump after the company reports. Wednesday: Meta, Ford - Q3 2022 earnings release at 4:05 p.m. ET; conference call at 5 p.m. ET - Projected EPS: $1.90 - Projected revenue: $27.47 billion He called himself the "only believer" of the Facebook parent company. - Q3 2022 earnings release at 4:05 p.m. ET; conference call at 5 p.m. ET - Projected EPS: 27 cents - Projected revenue; $37.46 billion While the demand is there for Ford's vehicles, supply isn't, Cramer said. Thursday: Apple, Amazon - Q4 2022 earnings release at 4:30 p.m. ET; conference call at 5 p.m. ET - Projected EPS: $1.27 - Projected revenue: $88.79 billion Cramer said he's sticking to his mantra of "own it, don't trade it" when it comes to Apple. - Q3 2022 earnings release at 4 p.m. ET; conference call at 5:30 p.m. ET - Projected EPS: 22 cents - Projected revenue: $127.49 billion Cramer said he likes the company, especially because its cloud business seems to be doing well. Friday: Colgate-Palmolive - Q3 2022 earnings release at 7 a.m. ET; conference call at 8:30 a.m. ET - Projected EPS: 73 cents - Projected revenue; $4.47 billion There are better consumer packaged-goods plays than Colgate, he said. Disclaimer: Cramer's Charitable Trust owns shares of Halliburton, Alphabet, Microsoft, Meta, Ford, Apple and Amazon. Sign up now for the CNBC Investing Club to follow Jim Cramer's every move in the market. Questions for Cramer? Call Cramer: 1-800-743-CNBC Want to take a deep dive into Cramer's world? Hit him up! Mad Money Twitter - Jim Cramer Twitter - Facebook - Instagram Questions, comments, suggestions for the "Mad Money" website? madcap@cnbc.com

AMZN

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Why Netflix Stock Jumped This Week

Week to date, shares of Netflix (NASDAQ: NFLX) were up more than 24% as of 12:17 p.m. ET on Friday, according to data provided by S&P Global Market Intelligence. The streaming leader posted its first quarter of subscriber growth since the fourth quarter of last year. Netflix delivered paid net subscriber additions of 2.41 million, beating management's guidance of 1 million.

Yahoo

Why Netflix Stock Jumped This Week Week to date, shares of Netflix (NASDAQ: NFLX) were up more than 24% as of 12:17 p.m. ET on Friday, according to data provided by S&P Global Market Intelligence. The streaming leader posted its first quarter of subscriber growth since the fourth quarter of last year. Netflix delivered paid net subscriber additions of 2.41 million, beating management's guidance of 1 million.

AMZN

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Paramount: Could Move But No Merger Seen Due To Redstone Ghosts

Paramount Global stock is cheap for certain, but outside of a deal or merger, it has upside but business model needs shakeup and consolidation. Read more here.

SeekingAlpha

Paramount: Could Move But No Merger Seen Due To Redstone Ghosts Summary - A stubborn need for control lives on well past Paramount's founder in the genes of daughter Shari Redstone. - Too many assumptions about rescuing the business model with "new content" inhabit all earnings calls of all streamers. It is mantra. - Paramount Global stock is cheap for certain, but outside of a deal or merger, it has upside but business model needs shakeup and consolidation. - Looking for a portfolio of ideas like this one? Members of The House Edge get exclusive access to our subscriber-only portfolios. Learn More » There is one stubborn, durable truth prevailing in the entire entertainment ecosystem today. Its only two words. But those two words are a far better, and reliable cypher to decode that most of what you'll read in the financial media about buy, sell or hold Paramount Global (NASDAQ:PARA). The two secret words that tell all: Skip ads. In those two words, investors can probably substitute hours of eye strain clicking away on dozens of sites where media analysis gurus are stuffing endless metrics about the prospects for the besieged streaming sector's participants. The short of it is our premise that Skip ads is a telling signal that the streamers want life both ways. They thirst for reliable flows of ad money to support versions of their site while at the same time, they convey the subliminal message: Hey, we know you think commercials are an obnoxious pain in the butt. So here's a button you can click and save yourself from yet another idiotic commercial of a politically correct, diverse group of millennial actors crowded on a couch holding beers, high fiving between roaring laughter at a touchdown. In reviewing the vast proliferation of sometimes savvy and sometimes pitifully naïve takes on the investment prospects of the wild west of the current entertainment ecosystem, we find a wide spectrum of opinion. No surprise there. Some observers believe the bare knuckled battle for subscriber growth among the players in the space is coming to an end. What more proof of that than the news that friend Warren Buffett has taken a position in the stock to the tune of 78.4m shares valued at $2.5b? Not much, right behind him sits BlackRock and Vanguard. So why has the stock taken a major league beating regardless of this act of faith from the Pope of Omaha? Warren or not, Mr. Market seems unimpressed, believing, with some hard thinking, that the battle has gotten so bloody with accumulating losses showing no end in sight. And that the only inoculation to tame the bacteria of an overcrowded, often confused state of play is consolidation. Above: Not very pretty but indicative of what overcrowding of a sector vertical can produce. Sales growth and losses. Ask the operators of sports betting who have the same problem. The streamers are facing two rock-hard realities: the entertainment ecosystem's overall growth is slowing though there could be intermediate spurts. Secondly, Old Man Recession just around the corner will have a predictable impact on slowing ad spend. So, seeing ad-supported streaming as a savior may be more wishful thinking than a lifesaver. Among other moves, PARA has already dropped a combined ad-supported bundled price deal. It's far from a panacea. To think that, in a sliding ad spend macro world, rescue lies in reducing monthly fees by offering ad supported content, and that this will be the crisis solver, is problematical. It won't, but some happier prospects for ad supported streaming do come with Para's PLUTO TV channel, aimed at the gut of the budget subscriber who will endure ads to snare a cheaper monthly bill. It's a crap shoot - not a wild proposition bet - but a good odds bet: you bet the line and take the odds. Long-term hold on craps is promising if you don't waste money on bad prop bets. We are of the school that believes that a merger or buy out of Para looms as a possibility. Yet we look at the genetic history of Ms. Shari Redstone and see a different story. The inclination we believe is to fight on, alone to the end, when EBITDA finally glows gold every quarter. The numbers may say yes, but the genes aren't easy to convince (You will pardon the author's slight edge into hypocrisy for this brief, Don't-Skip intro because we believe it brings real context to our ultimate guidance on the stock). To get a perspective on the Paramount Global state of play, in our view, we must go way back in the day to March 29, 1979. On that day, a massive fire broke out at the legendary Copley Plaza Hotel in Boston. Caught between floors, theater magnate Sumner Redstone, then a mere boy of 56 (he lived until 97), ran up the stairs to the roof. As flames licked ever closer on the roof, Sumner climbed over the edge and hung there by his thumbs, during an incredible amount of time awaiting rescue. (Estimates of how long he held on are far too many to be totally credible. Though all agreed it was an astonishing endurance.) But that was only part of the story. The rest was Redstone's battle through over 30 hours of surgery to literally save his skin and life. Against all naysayers, not only did he survive, but went on to bull his way to the top of the entertainment business by building Viacom from his theater chain. We cite this little tale - you've already guessed it - because over many years, investors have learned how those Sumner genes have clearly passed onto his daughter, Ms. Shari Redstone. Above: Father and daughter, boxing gloves off, between rounds of their longstanding fight to the finish. From the days when father and daughter went brutally mano y mano on so many issues, 'til today when Ms. Redstone rules the Paramount roost, we have concluded that she's got her thumbs on the rooftop and isn't going anywhere awaiting a rescue. She's prepared to do a flip and jump to safety on her own. It could happen, but nothing hints at it now. Shari's defined sense of ownership, we believe, is part of why the company overall, with so many great assets, will need to remain dead-pooled in its current trading doldrums before she can finally fall into a fireman's net and say, take me, I'm yours. That fireman could be Buffett, who has been a known value bloodhound for decades. On the other hand, it is fair to present a bull case on PARA that may well find a deep-pocketed suitor who sees its current trade at $19. Even a modest premium could provoke dancing in Omaha. This genetic history will never find its way into any current appraisals of the stock, or management or deep-dive analysis of its future potential. But several of our ex-colleagues in the industry from way back in the day who know her and knew daddy well agree: Its Shari's bat, her ball and glove, and if she walks, the company will. If she doesn't, she'll still call the balls and strikes and umpire the game. Paramount: A realistic bull case Stipulation: In reviewing the vast coverage of PARA published over the past several months and comparing some of the conclusions with industry pros I have known for decades, all believe a degree of recency bias has infused much guidance. Citing PARA's blockbuster successes in Yellowstone (check out the marvelous prequel "1883"), and factor in the Top Gun sequel, and find that many analysts lean their valuations on the skill sets that enabled PARA to mount such great shows as a stalking horse for more to come. It's a false premise, both for PARA and any of its competitors. Great movies are as much accidental as purposeful targets of the most innovative of producers. A long-time colleague who was a close-in viewer of the tortured process from the Mario Puzo bestseller The Godfather, to the final blockbuster opening, told us: "These Paramount guys pulled the guts out of Coppola for years, fighting him every step of the way. They were convinced they'd made a colossal flop 'til almost the premiere. Nobody but Coppola himself had the guts and staying power to absorb the abuse and prove his point." Our point here is that baking in potential earnings power into Para stock based on some dreamlike supposition that it has another Godfather or Yellowstone it can just pluck out of its development department is delusional. Thunderbolts can indeed happen. But what you want to see in Para is a slate of solid, economic quality content pouring out of its many verticals with a shorter lifespan from script to payoff. In truth, the famous words of the brilliant screen writer William Goldman (d.2018) apply here to Hollywood and all filmed entertainment pretenses. He said, "Nobody knows anything." His premise: at best, picking projects for potential blockbusters is a total crap shoot. So, to bake in the prospects of PARA or its competitors to repeat past victories is no way to value the forward earnings of their stocks. More telling, we believe, is how well a media giant like PARA can be producing solid genre films that appeal to general as well as niche audiences at a cost that virtually assures an ultimate profitability to the producers. That's the apparent route Warner Bros. Discovery (WBD) boss David Zaslav has laid down for his company. And, to us, not a bad model for Paramount to consider. Paramount has proven it can do this. Its film library does, of course, have its family jewels: Star Trek, The Godfather, Top Gun, as noted overall totaling 3,000. These include lots of golden oldies like the famous Bob Hope/Bing Crosby buddy "Road" pictures as well as the "Butch Cassidy" films which appeal to a much older demo. This can't be a business living in this competitive miasma focused on one, single golden millennial demo. Far too many subscribers are shaking their heads bemoaning the mantra, "Thousands of shows, nothing to watch." The PARA library has an estimated value of $1.35b according to STATISTICA. The current total market cap sits at $12.522B. The horses in the PARA stable, like many of its peers, contain thoroughbreds as well as candidates for the glue factory. Paramount Pictures, CBS (broadcast with NFL deals as well), Sponge Bob, Nickelodeon, and of course Paramount + with its impressive, but relatively ho hum, 46m subscribers. Good idea number one: Para has announced their intention at some point to merge Paramount + and its legacy Showtime channel. It's a good idea because they can't continue to play second fiddle to HBO going forward. Yet it has done some outstanding shows like Billions, Ray Donovan. It hews to the current formulaic content which suffuses many of its shows with sex, mystery, brutality, hostility among citizens city and country, and the appropriate bow to woke-isms. The bottom line here: Para does excellent content, but to be brutally frank, so does everyone else. Except PARA's 46m subscriber base sets up a far tougher climb to profits than does Netflix (NFLX) (74m subs), Disney+ (137m subs), WBD (100m), and Amazon (AMZN) (Over 200m prime members globally). So the question is raised: Where does PARA fit? TTM: Revenue: $29.7B Quarterly revenue growth 18.50%. EBITDA: $3.39b Short ratio: 5.53 EV/EBITDA: 4.83b Projected EBITDA: $3.5b Best estimate for bulls: Valued at 7X EBITDA Market cap at writing: $12.522b Operating margin: 10.10-kind of meh. Quarterly revenue growth: 18.50% strong, mainly tied to Paramount+ and Pluto TV. Balance sheet highlights Total cash (mrq) $4.04B. A solid number indicative of good cost discipline in many areas (not all). Total debt: $17.3B---this is a heavyweight number and investors need to really consider that as one of the downsides of the stock's ability to move north. Efforts at debt reduction have been made, refis have put maturities comfortably into the future 5/6 years. The company's current ratio is a very comfortable (mrq) 1.47 Book value per share: $35. A stock trading so far below book would normally signal heightened interest among value investors. But analyst earnings estimates for 2022 are 2.3b and for 2023: $1.62b. Revenue estimated consensus: 2022: $30.5b 2023:$ 30.79b EPS trend: 2022: 2.3 2023: 1.62 Each of Para's verticals face challenges: CBS worries about sagging ad spend ahead despite what management had to say about happiness about their upfront advertising results. Paramount+ sits in a difficult place, just as we pointed out in our recent piece of Lions Gate: The dilemma: Too small to build a footprint anywhere near the giants and too small to just sit fat dumb and happy with what they have with a big debt load to manage through. Inflation has run up the costs of production, with the time span from script to payoff running far too long for healthy cash flow. But at its current size, and looking forward to a revenue flow that appears to run flat, its price at writing of $19.11 seems to us to show a pathway to a diverse entertainment portfolio modest buy. Call it underweight or a toe-dip on prospects, but we do think the stock, given all the weakening of the entertainment ecosystem we are now seeing, presents an attractive entry point. Its asset base is undeniably diverse. We do see an echo in management statements about monetizing the library better than what has been done in the past. That strategy comes straight from the successful playbook of Messers Eisner and Katzenberg, the two ABC executives brought into The Walt Disney Company (DIS) by Walt's brother Roy in 1984. Their first move was to find ways to market and repurpose existing legacy Disney characters and stories. Without initially spending a ton on new content development, the pair trotted out Mickey Mouse, Donald Duck, and company in dozens of new "clothes" and set the company on its long march to becoming an earnings machine. PARA's extensive film and TV library can embark on just such a path to ignite new sources of revenue from established pop culture sources they control. They could also build Paramount+ in the space of cost conscious new content that adds value to the channel making it far more competitive with the giants. Overall we do see it as a price play. Downside risk is somewhere around $10.50, when and if their announcements on new subs may possibly disappoint Mr. Market. Upside, given a management awakening about imposing good controls on producing viable content could have a $27.50 price by Q2 2023. But overall, our best bet for PARA stock is the obvious arrival of a real solid bidder to either merge or buy the company at a nice but not punitive premium that would make everyone happy. Yet, there appears to be no strong sentiment at the moment based on what we surmise (yes, it's an educated guess, not more) would not be a welcome sale of the company. But if the company continues to slog along on earnings call happy talk about great new content and rising subscriber numbers, we don't see much of a rationale for the stock. That's why, if you got in anywhere between the current price and the low twenties, it's a hold. If you are not in the stock, it's definitely got enough value for a toe dip buy. For in-depth and deep dive research on the casino and gaming sector, subscribe to The House Edge. New: Free excerpts from our book in progress "The Smartest ever Guide to Gaming Stocks" - free to existing members and new subscribers. This article was written by My two books are presently sold as Kindle ebooks on the Amazon site: MASTERING THE ART OF CASINO MANAGEMENT and THE GREAT AMERICAN CASINO BAZAAR. I have appeared on industry seminar panels and on national radio and television discussing various aspects of industry growth. I am a graduate of NYU's Stern School of Business and did work toward a Master's degree in economics at the Columbia School of General Studies. For 30 years I held senior vp and exec VP positions in major casino hotel operations among them Caesars, Ballys, Trump Taj Mahal and have done extensive consulting assignments for many others in the US, including the native American property Mohegan Sun, in Connecticut. I have also done special projects for Caesars Palace in Las Vegas. I was the founder and publisher of Gaming Business Magazine, first ever publication covering the gaming industry and have written extensively about the industry. MY INVESTMENT STRATEGY: Due to the necessities of my casino consulting business which encompasses many top gaming companies, I have placed my own gaming portfolio into a blind trust over ten years ago. At that time I instructed my money manager(who is a former industry colleague herself as well as a corporate lawyer and money manager) to follow my gaming investment strategy along these lines. 1. I am a value investor first. Knowing the industry in depth I am able to plumb opportunities and problems others cannot see. Mostly I like to identify price ranges over given periods where I believe the market is asleep and I can buy in at the lowest possible risk. 2. I am a strong believer in management quality. Knowing so many top people in the industry allows me to evaluate which ones I believe have the "right stuff" to move a stock and which are populated by corporate drones. 3. I have instructed my manager never to trade on sugar high spikes in earnings or news per se but use the "string theory" I have developed which in brief, follows a skein of news and earnings releases over set periods of time for each stock and then move in or out. 4. I have instructed her to keep the portfolio diverse with holdings in four basic areas: Casino stocks in Las Vegas, Macau and the regionals, gaming tech stocks with real moats not just cute apps. I am pleased to announce that as of September 1, 2022 I am expanding my coverage to include entertainment stocks, a sector undergoing a massive revolution on many fronts. This has sprung loose many investment ideas in the space I expect to share with members. The coverage is added at no extra cost. I have been involved in the entertainment sector as well for decades involved in overseeing show and events in my properties as well as independent productions. I currently sit on the board of privately held Atlas Media Corporation, one of America;s premium non-fiction producers of tv and film programming. Overall I have done immensely well and share my views with SA readers and more specifically with strong recommendations and gaming stock strategy analysis based on my network of industry contacts for subscribers to my SA Premium Site: THE HOUSE EDGE. Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (54) My guess : WBD and PARA in one company can compete against the others. It’s all about SCALE and GLOBAL (world) reach. John Malone knows how to do it! In good times you can advertise. In bad times you have to advertise.How else would I have known in 2010 that Toyota and Honda and other auto manufacturers were offering 1.9 % interest or better yet no interest on auto loans. Furniture stores and big box stores were having "blowout sales?"—all through TV ads. At the very least the media companies promote their own products.That Mr. Sumner Redstone was a tough old bird and fought with Sheri Redstone is well-known. The battles Royale with hard knocks and sharp elbows, honed Ms. Redstone's savvy acumen. Ask those who have tangled with her confident that they would prevail and lost—Les Moonves and Mr. Joseph Ianniello.Ms. Redstone's has stated publicly and repeatedly that she is committed to maximizing shareholder value. Presently she has invested Mr. Bakish (age 58) via organic growth to make that happen.She has already turned down a merger with Comcast (CMCSA). That in 2023 or 2024 she agrees to be bought by Amazon (AMZN), Apple (AAPL), Disney (DIS), or Netflix (NFLX) is a viable scenario.NFLX and may be DIS are the 800 pound gorilla(s). An independent Paramount Global (PARA) can never, on its own, become an 800 pound gorilla. Moreover, the industry cannot sustain multiple 800 pound gorillas.Furthermore, Mr. Buffet who is also a shareholder of Apple, curiously took a position in PARA via non-voting Class B shares. Did he see the value in PARA, but did not want a conflict of interest if Apple (AAPL) decides to make an offer for PARA?I seriously doubt that Mr. Buffet wants to buy PARA. His rule is: Buy companies with great management and let them run the company. At a 27 billion dollar investment, Buffett sees great management at PARA.Additionally, at 68 years old, Ms Redstone is interested in monetizing the value of her PARA holdings for herslf and her family. Time stands still for no one.That PARA has a library with 3,000 holdings it is overhyped and overrated. Public libraries and digital libraries have millions of holding in their collections, but how many (percentage) are actually rented or borrowed. Frequently it is a large number of the same titles being borrowed or viewed over and over. Individuals have their own libraries of DVDs and CDs. Some of which have only been viewed or listened to a handful of times. Most libraries are mostly an archive--even when cited as a treasure trove.Presently, the entire entertainment industry is out of favor and having to walk through purgatory. Once Wall Street decides the odyssey is over because all the companies are suitably undervalued and there is money to be made, the stock prices will re-inflate.There are plenty of investment analysis that place a target price on PARA between $30 and $50 and even $100. Why doesn't someone figure out what Ms. Redstone Dollar Cost Average (DCA) price is. Mr. Buffet's DCA is estimated to be in the low 30s. If Ms. Redstone's DCA is at a similar price, a merger might be easier to achieve than most people realize.Ms. Redstone and Mr. Buffet are patient investors. Like Ted Williams (Mr. Buffett is a fan of Ted Willaims) Sheri and Warren only swing at their pitch. It appears that their pitch has not yet been thrown.Full disclosure: I have been a shareholder of Viacom, Viacom, and Paramount Global since November 2017. Buffett will not buy PARA.Streaming depends on scale and global reach.Why would he buy PARA and compete against Netflix,Apple,Amazon and WBD.Streaming is not a great business model when you are a relative small company.Surviving is only possible in large scale subs numbers and going global. Strong Sell. I have studied CURI some time ago. Too small, weak financial numbers. Will not be the next Discovery. Soon they will need more cash, dilution of shares is next. Not really important now. If WBD and PARA merge in 2025 or later than at that moment the fair value has to be recalculated. WBD cannot sell or merge before/until 2024 according to IRC rules without a severe penalty.PARA is undervalued because at the moment nobody can or will buy them. Also Shari will not sell at todays low market value prices. I imagine they're going to buy someone with an extensive library and affiliation to sports within the next couple years. The only question is who do they buy? Maybe they'll make an offer to one of these companies when they see a clear market bottom. Agree CBS and Viacom seperated are worth more than together but that is not happening right now. Bakish wants to integrate Showtime into Paramount+.Merging PARA with WBD in an all stock deal giving up control for the Redstones seems to be the best option. Shari would get New Shares without control. But she would get a big peace of the former WBD assets too which have a large value even without controlling it.The new WBD + PARA company would flourish and finally create the shareholders value Shari wanted without having control. She can leave that in the hands/CEO of her good friend David Zaslav. Probably she could get a Board seat next to John Malone. No way if a merger happens in 2025 or later both companies have acceptable debt loads and debt ratios. Both WBD and PARA are doing the same strategy Bolster the company make it efficient and lean they are both heading towards the same direction….. I am long WBD and fortunately I sold my PARA in the 30's. At the time I sold PARA it was only because I needed money. I wasn't negative about it. I was monetizing assets to buy all of the LMT that I could afford when it was in the 330's. My take on PARA is that Shari Redstone wants to make her own name in the media industry. She has spent her career in her father's shadow and desires to prove to the world that she can do better than Sumner. From time to time the father / daughter disputes would make news. Shari was forced to accept Sumner's decisions but now she has a chance to show everyone how to do things right (her way). Changing the company name was Shari's way of distancing herself from her father. Viacom and Sumner Redstone were interchangeable. When emotions override common sense, don't expect the best results. Shari Redstone has complete control of PARA. PARA is going to idle along, pay down debt and return about 1/2 of its earnings to shareholders in dividends. It is about as exciting as a utility. I believe that a PARA / WBD merger would be in the best interests of both companies. It won't happen unless Shari becomes CEO of the new company. Zaslav and Malone will not allow that to happen. David Zaslav and Shari Redstone are reportedly close friends. Perhaps there will be some type of merger in the future after Shari makes her mark on the industry. PARA at $19 is tempting. WBD at $13.50 is a much better buy. WBD first has to pay off Debt and get the Debt Ratios under control. To do this is by maximizing Free Cash Flow annually. So PARA’s marketcap equals its worth of that of the library. Wallstreet gives no value to its lineair network and cable because nobody wants to buy it. Also the Debt Load decreases the value of the lineair broadcast and cable network.My guess it only makes sense to put WBD and PARA together and benefit the scale advantage of both lineair and cable networks.

AMZN

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Why Hawaiian Holdings Stock Is Flying High Today

The parent of Hawaiian Airlines is joining forces with Amazon (NASDAQ: AMZN) Prime Air cargo operations, and investors are excited about the opportunity. Shares of Hawaiian Holdings (NASDAQ: HA) traded up as much as 14% on Friday after the agreement was announced. Over the past few years, Amazon has been slowly building a formidable cargo air operation by partnering with, and often investing in, airline operators who are willing to fly planes under its branding.

Yahoo

Why Hawaiian Holdings Stock Is Flying High Today The parent of Hawaiian Airlines is joining forces with Amazon (NASDAQ: AMZN) Prime Air cargo operations, and investors are excited about the opportunity. Shares of Hawaiian Holdings (NASDAQ: HA) traded up as much as 14% on Friday after the agreement was announced. Over the past few years, Amazon has been slowly building a formidable cargo air operation by partnering with, and often investing in, airline operators who are willing to fly planes under its branding.

AMZN

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Amazon.com Inc. stock outperforms market on strong trading day

Shares of Amazon.com Inc. rallied 3.53% to $119.32 Friday, on what proved to be an all-around favorable trading session for the stock market, with the S&P...

MarketWatch

Shares of Amazon.com Inc. AMZN, +1.30% rallied 3.53% to $119.32 Friday, on what proved to be an all-around favorable trading session for the stock market, with the S&P 500 Index SPX, +0.67% rising 2.37% to 3,752.75 and the Dow Jones Industrial Average DJIA, +0.93% rising 2.47% to 31,082.56. This was the stock's second consecutive day of gains. Amazon.com Inc. closed $68.79 below its 52-week high ($188.11), which the company achieved on November 19th. The stock outperformed some of its competitors Friday, as eBay Inc. EBAY, +2.69% rose 2.10% to $38.41, Alphabet Inc. Cl A GOOGL, +0.59% rose 1.16% to $101.13, and Walmart Inc. WMT, -0.15% rose 2.02% to $136.80. Trading volume (54.9 M) eclipsed its 50-day average volume of 53.7 M. Editor's Note: This story was auto-generated by Automated Insights, an automation technology provider, using data from Dow Jones and FactSet. See our market data terms of use.

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How Do Stocks Work?

Your brief beginner's guide to how do stocks work in the stock market.

StockMarket

When you hear people talk about the stock market, it can seem like a foreign language. Stocks, bonds, bull markets, and bear markets, can all be very confusing for someone who doesn’t know the ins and outs of the stock market. But it doesn’t have to be that way. In this blog post, we’re going to discuss how do stocks work. As well as how you can start investing in them. What Is a Stock? Simply put, a stock is a share in the ownership of a company. When you buy a stock, you are essentially purchasing a piece of that company. For instance, let’s say that you purchase one share of Amazon (NASDAQ: AMZN) stock. This means that you now own a tiny portion of everything that Amazon owns—its factories, its patents, its products, etc… As an owner of Amazon stock, you are entitled to a portion of the profits (or losses) that the company makes. What Is Common Stock? Common stock refers to the ownership shares of a corporation. Common shareholders are typically entitled to vote on corporate matters and elect the board of directors. They may also receive dividends, although this is not guaranteed. Additionally, common stock is typically more volatile than preferred stock, meaning that its value may fluctuate more in response to changes in the market. For this reason, common stock is often considered to be riskier than preferred stock. However, common stock may also offer greater potential rewards, making it an attractive investment for many people. What Is Preferred Stock? Preferred stock is a type of equity that provides certain benefits to shareholders, including preference in the payment of dividends and liquidation proceeds. What’s more, preferred shares also typically have a higher dividend rate than common shares, making them an attractive investment for income-seeking investors. However, preferred shares typically have less upside potential than common shares, as they do not participate in the earnings growth of a company to the same extent. As a result, preferred shares are often considered to be a more conservative investment than common shares. How Do Stocks Make Me Money? There are two ways that stocks make money: - Dividends - Capital gains Dividends Dividends are payments that companies make to their shareholders out of their profits. For example, let’s say ABC Corporation makes $1 million in profit this year. They may decide to pay out $500,000 of that profit to their shareholders in the form of dividends. So if you own one share of ABC Corporation, you would get $500 divided by 1000, or $0.50 cents in dividends this year. Capital Gains The other way stocks make money is through capital gains. Capital gains occur when you sell your shares for more than you paid for them. For example, let’s say you bought one share of ABC Corporation for $100 and then sold it later for $150. Your capital gain would be $50 ($150 – $100). Capital gains can either be short-term (held for one year or less) or long-term (held for more than one year). Short-term capital gains are taxed at your marginal tax rate while long-term capital gains are taxed at a lower rate. [Read More] Best Dividend Stocks To Invest In Right Now? 4 For Your List How Do Stocks Increase In Value? The price of a stock is determined by supply and demand in the marketplace. If more people want to buy a stock than sell it, the price will go up. On the other hand, if more people want to sell a stock than buy it, the price will go down. Investors buy stocks for two reasons: - They believe the stock will go up in value so they can sell it at a profit later. - They want to own a piece of a company that they believe will be successful in the future. Many investors also hold onto stocks for both reasons—they expect the stock to increase in value and they want to own a part of a company with good long-term prospects. How Do Stocks Decrease In Value? There are all sorts of factors that can affect the price of a stock, but ultimately it comes down to two things: earnings and expectations. If a company’s earnings are better than expected, its stock price will usually go up because investors are willing to pay more for shares of a successful company. On the other hand, if earnings are worse than expected, the stock price will usually go down because investors are not willing to pay as much for shares of a struggling company. Similarly, if investors’ expectations about a company’s future prospects are high, its stock price will usually be high as well even if current earnings are not so great. And if expectations are low, then investors will be less willing to pay top dollar for shares even if current earnings are strong. [Read More] What Are Bonds? Your 2022 Beginners Guide How To Buy Stocks Online How to buy stocks online is a question that many people ask. With the advent of the internet, buying stocks has become easier than ever before. However, there are still some important steps that you need to take in order to ensure that you are making a wise investment. First, you need to do some research and find a reputable online broker. Next, you need to create an account with the broker and fund it with money. Finally, you can begin buying stocks online. As long as you follow these simple steps, you will be well on your way to making a wise investment in the stock market. Bottom Line Now that you understand the basics of how stocks work, you’re ready to start thinking about investing your own money. Remember, stocks can be volatile, so it’s important to do your research before buying any shares. But if you’re patient and disciplined, investing in stocks can be a great way to build your wealth over time. 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AMZN

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Tesco meal deal: How much has the price increased?

Here's how the changes in the popular lunch package affect you and how offers at other stores compare.

Yahoo

Tesco meal deal: How much has the price increased? Tesco (TSCO.L) has hiked the price of its popular lunchtime "meal deal" as it passes on price rises to customers amid rampant inflation and cost of living crisis. The UK's biggest supermarket's sandwich, snack and drink deal will jump to more than £3 for the first time in 10 years. That means the price will go up from £3.50 to £3.90 for customers who are not Tesco Clubcard holders. The supermarket put up the price of its popular lunch choice from £3 to £3.50 for non-Clubcard members in February, but the latest rise marks the first time the meal deal has gone over £3 for all customers, rising to £3.40 for Clubcard holders. In July, fast food chain McDonald's (MCD) raised the price of its 99p cheeseburger to £1.19 for the first time in more than 14 years as it battles growing cost pressures. It said that the price of "menu items impacted most by inflation" would also go up between 10p and 20p. Read more: McDonald's raises price of 99p cheeseburger as it passes rising costs to customers UK households have seen the cost of everyday food items surge at the fastest pace since 1980, with the price of bread, diary, meat, and cereal all climbing. On Wednesday, it was revealed that food inflation was running at an annual rate of 14.6% — the biggest leap in the cost of food on records from the Office for National Statistics since 1989. Meanwhile, UK inflation was running at 10.1% in September. The cost of food production has soared significantly after Russia's war in Ukraine, which has sparked higher grain, oil and energy prices, as well as weakness in the pound. Has the price gone up for Tesco Clubcard members? Clubcard users, who account for 70% of meal deal customers, will see the price of the lunch package go up 40p in line with inflation to £3.40 from £3. The Tesco Clubcard is a free card that gives customers discounts. A Tesco spokesman said: "Clubcard members will pay just £3.40 for a main, snack and drink, making our meal deal an ideal way to grab a great value lunch on-the-go. Read more: Greggs raises the price of its sausage roll again despite strong sales "And with savings of up to £3 on millions of possible combinations across our stores, including the recent addition of Costa hot drinks, and our ever-popular Christmas sandwiches which join the meal deal for the festive period, we’ve got something for every taste." What about other supermarkets? Tesco's competitors, including Sainsbury's (SBRY.L) and Co-op, offer similar meal deals at £3.50 and £4 respectively. Morrisons charges £3.50 for its for its food to go range, which consists of one main, one snack and one drink. While Asda shoppers can't buy a specific meal deal, the grocer offers a "three items for the price of two" deal where customers purchase the two most expensive items and get the third free. Since September Britain's third largest supermarket has been trialing a new three for £3 deal in some of its stores. Read more: UK inflation back to double-digits as price rises hit 10.1% Amazon Fresh (AMZN), which has 17 till-less stores in London, offers a "food for now" meal deal. However, the offer is slightly different from other stores as it does not charge one set price, instead customers pay for their main item, costing around £2 to £5, then add an extra £1 for a side and drink. Bakery chain Greggs (GRG.L) announced it would hike up the price of it famed sausage roll for the second time, going from £1.05 at the start of the year to £1.15 earlier this month.

AMZN

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Amazon earnings: 'The good news is the consumer is still spending. The bad news is they're not spending on e-commerce.'

When Amazon.com Inc. reports third-quarter earnings, Wall Street will be wondering what the online retailer can do to bring more customers back.

MarketWatch

Money is still flowing despite concerns about the economy, but Wall Street is wondering how much of that money is being spent on Amazon.com Inc. “The good news is the consumer is still spending,” D.A. Davidson analyst Tom Forte told MarketWatch. “The bad news is they’re not spending on e-commerce.” When Amazon AMZN, Retailers across the U.S. are cutting prices to clear jammed-up inventories after supply-chain delays and consumers’ pivot to basics left stores with loads of unwanted clothing, electronics and offseason goods. Forte said Amazon’s decision to hold a second Prime Day shopping event this year suggested the online retailer may be dealing with similar issues. Don’t miss: The holiday-shopping season has a different problem this year than last — and it could lead to some deals “One interpretation of having that event is that Amazon needed the opportunity to unload some excess inventory, or Amazon provided the third-party sellers on its platform the opportunity to do so,” he said. However, Sucharita Kodali, an analyst at Forrester Research, told D.A. Davidson analysts that Amazon has revamped Prime Day every year, according to a research note this week. And she said the decision could help Amazon by pulling typical holiday sales into October and “(blunting) the impact of competitors’ promotions in November and December.” The Amazon fears don’t end with online shopping, though. Because Amazon is growing internationally, the stronger dollar will cause issues. There are also questions about whether large entertainment investments — such as Thursday Night Football and “The Lord of the Rings: The Rings of Power” — will pay off. And as the winter holiday deal season creeps further into fall every year, analysts will likely be watching for any clues on whether consumers are growing more cautious. Demand for Amazon’s AWS business, Forte said, could be propelled by businesses’ efforts to save money on technology, as they contend with their own rising costs. But he cast doubt on the company’s efforts to make money on the NFL via Thursday Night Football and “The Rings of Power,” an adaptation of J. R. R. Tolkien’s fantasy novels. Opinion: ‘People will freak out’: The cloud boom is coming back to Earth, and that could be scary for tech stocks Different media reports have put the cost of rolling out “The Rings of Power” — a prequel series to Tolkien’s books available on Amazon Prime — at anywhere from $715 million to upward of $1 billion. Amazon’s 11-year deal to bring Thursday Night Football games to Prime Video this year will cost it roughly $1 billion annually, according to reports. But after Amazon raised its U.S. Prime membership fee by $20 this year to counterbalance rising costs, Forte said he wondered how many Amazon shoppers ultimately cared about football and fantasy. CNBC reported that Amazon’s first Thursday Night Football game drew record Prime sign-ups in a matter of hours. While the Rotten Tomatoes critics rating for “Rings of Power” stands at 85%, the average audience score for the series is 39%. “I fully expect Amazon to talk as glowingly as possible about both ‘Lord of the Rings’ and Thursday Night Football, given that they’re huge investments,” Forte said. “But I think they have a risk of losing subscribers to Prime. You don’t want to pay 20 bucks more if they’re not Tolkien fans or they’re not football fans.” Still, Wall Street expects Amazon to swing to a profit in the third quarter, after two consecutive quarterly losses due to rising costs and its investment in struggling electric-vehicle maker Rivian Automotive Inc. RIVN, But following two straight losses, the results will also arrive as Amazon tries to tighten up operations amid concerns of a recession. Earlier this month, the New York Times reported that Amazon would pause corporate-level hires in its retail business. Amazon has also pulled back on opening new facilities, some data shows, and is halting testing of a home-delivery robot, according to reporting from Bloomberg. What to expect Earnings: Analysts polled by FactSet expect Amazon to earn 22 cents per share in the third quarter, down from 31 cents in the period a year ago. Contributors to Estimize — a crowdsourcing platform that gathers estimates from Wall Street analysts as well as buy-side analysts, fund managers, company executives, academics and others — are projecting earnings of 25 cents a share on average. Amazon reported losses in the first and second quarters, following a steady drop in Rivian’s stock price over this year. Amazon’s loss in the first quarter was its first in seven years. Revenue: Analysts expect Amazon to report third-quarter net revenue of $127.29 billion, according to FactSet, up from $110.81 billion a year ago. Estimize contributors are projecting $127.93 billion in revenue. Stock price: Amazon stock has tumbled 30% so far this year. That’s worse than the S&P 500 index SPX, What analysts are saying Amazon is looking to cut back amid signs of more reserved holiday shoppers getting less bang for their buck. Analysts at Deloitte this week said they expected rising prices to tame consumer holiday purchases. They expect roughly flat year-over-year holiday spending this year, at an average of $1,455 per customer — an amount that reflects spending on gifts, non-gift purchases and things like entertainment. But they also said shoppers planned to buy nine gifts for family and friends this year, compared with 16 last year. Some analysts view Amazon’s cutbacks as a positive. UBS analysts trimmed their price target to $165 from $180 ahead of the report, but kept a buy rating and wrote, “the broader arc is one of more discipline, greater efficiency and higher margin.” Opinion: Tech earnings are about to dive, and there’s no life preserver in sight “We continue to see Amazon driving margin improvement, driven by (1) higher fees across Prime, FBA, fuel surcharges, and holiday shipping surcharges, (2) lower energy costs (~20% of shipping) and falling freight costs, (3) rationalizing FC capacity (~10% of the square footage has been closed/canceled/delayed), (4) reducing employee oversupply, evident in the return of seasonal hiring bonuses and higher wages, (5) more discipline around growth investments (shutting physical stores, cutting Amazon Care, scaling back Grand Challenge),” they wrote. Aside from e-commerce, UBS analysts also see margins being helped by continuing growth in Amazon Web Services and Amazon’s growing advertising business, which produce higher margins than the retail business. “We think this trend shows up in 3Q / 4Q outlook and supports multiple expansion of AMZN shares,” they wrote. The fourth-quarter outlook could be the most important information Amazon executives provide for the path of the stock. Analysts on average expect holiday-season revenue of $155.35 billion heading into the report, according to FactSet. See also: Amazon shuts online store fabric.com in cost-cutting move “We’re most focused on 4Q guidance following Amazon’s Prime Early Access sale in mid-October and our view that overall operations are becoming more efficient,” Citi analysts, who have a buy rating and $185 price target on the stock, wrote in a preview. “Of the $2.5 billion of Amazon’s $6 billion of incremental expenses during 1Q expected by the end of 3Q largely related to inflation costs and FC efficiencies, given improving shipping and transportation costs along with increased FBA fees (offsetting inflationary pressures somewhat), we look for continued progress here for 4Q.” In total, 47 of the 52 analysts tracked by FactSet rate Amazon stock the equivalent of a buy, while four call it a hold and only one rates a stock as sell. The average price target as of Friday morning was $163.29.

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Shopping Center REITs: Bargain Hunting

Shopping Center REITs are one of the better-performing property sectors this year- outpacing their mall REIT peers. Read our latest analysis here.

SeekingAlpha

Shopping Center REITs: Bargain Hunting Summary - Shopping Center REITs are one of the better-performing property sectors this year- outpacing their mall REIT peers - as impressive earnings results and record-low store closings have offset looming recession concerns. - The versatility and larger footprint of the strip center format have been a winning formula as retailers have increasingly utilized their brick-and-mortar properties as hybrid "distribution centers" in last-mile delivery networks. - Critically, after a surge in store closings during the pandemic, the number of store openings has outpaced closings by nearly 2x since 2021 with particular strength in well-located strip centers. - Results across the shopping center REIT sector have been as impressive as any property sector over the past three quarters with fundamentals that are stronger than before the pandemic. - High-quality strip centers remain one of our favorite "value-oriented" property sectors at current valuations given their significant 'embedded' dividend growth potential and solid positioning for a variety of economic scenarios. - This idea was discussed in more depth with members of my private investing community, Hoya Capital Income Builder. Learn More » REIT Rankings: Shopping Centers This is an abridged version of the full report published on Hoya Capital Income Builder Marketplace on October 17th. Shopping Center REITs are one of the better-performing property sectors this year - outpacing their mall REIT peers - as impressive earnings results and record-low store closings have offset looming recession concerns. While the enclosed regional mall format faces a choppy road to recovery, the versatility and larger footprint of the strip center format have been a winning formula as retailers have increasingly utilized their brick-and-mortar properties as hybrid "distribution centers" in last-mile delivery networks. In the Hoya Capital Shopping Center REIT Index, we track the 15 largest open-air shopping center REITs, which account for roughly $50 billion in market value. Critically, after a surge in store closings during the pandemic, the number of store openings has outpaced closings by nearly 2x since early 2021, according to Coresight Research, with particular strength in larger-format strip centers. After surging to around 10,000 in both 2019 and 2020, just 5,000 retail stores shut down in 2021 while 2022 is currently on pace for the lowest level of store closings on record with a total net store openings on pace to be over 2,500. Importantly, we believe that this slowed the pace of store closings - particularly in the strip center format - goes beyond the near-term pandemic-related trends and is indicative of a sustained retailer focus on highly efficient and well-located large-format space which can serve as hybrid showroom and distribution centers. The proposed merger between supermarket chain Kroger (KR) - the second-largest grocery chain and Albertsons (ACI) - the fourth-largest grocery chain should have a minimal impact on these REITs outside of Kimco Realty (KIM), which has a strategic investment of nearly 40 million shares in Albertsons. KIM announced last week that it raised $300 million in a partial sale of 11.5M of shares and expects to pay a special dividend. Grocery-anchored centers have historically commanded premium valuations relative to power centers and REITs with a heavier balance of grocery-anchored centers have generally delivered steadier operating performance throughout the pandemic. Earnings results across the shopping center REIT sector have been as impressive as any property sector over the past three quarters with fundamentals that are as strong – if not stronger - than before the pandemic with a full recovery in both FFO and NOI now complete. As discussed in our REIT Earnings Recap, recent shopping center REIT earnings results have been impressive even compared to pre-pandemic standards - and occupancy rate trends and leasing spreads have been especially encouraging. Results in the second quarter pushed the average occupancy rate to the highest level since early 2015 at 93.6% while rental rate spreads have exhibited a notable acceleration since bottoming early last year. Over the past five REIT earnings seasons beginning with Q2 2021, Shopping Center REITs have delivered the highest total quantity of full-year guidance increases and the positive trend continued in Q2 with ten of twelve REITs that provide guidance raising their full-year FFO outlook. Upside standouts included Kite Realty (KRG), which reported another strong quarter and raised its full-year outlook. Driven by strong leasing activity with 13% blended cash spread, KRG now projects FFO growth of 22.0% this year - up 400 basis points from last quarter - and 10.2% above its pre-pandemic 2019 rate, the strongest in the shopping center REIT sector. Kimco was also a notable standout in Q2 earnings season, boosting its full-year FFO growth outlook to 12.3% - up 250 basis points from its prior outlook. Of note, KIM commented that one of the key drivers is their focus on "last mile locations" which are seeing positive traffic patterns at 101.3% relative to the same period last year. Strong leasing activity has been the positive highlight of the past several quarters and unlike their mall REIT peers, leasing volumes and rental rates have picked up considerably since early 2021. Encouragingly, leasing spreads stayed positive throughout the pandemic and meaningfully accelerated since mid-2021 with blended leasing spreads rising by over 8% for the fourth-straight quarter in Q2. indicating clear signs of pricing power for the first time since the mid-2010s. Notably upside standouts in Q2 on the leasing-front included grocery-focused Phillips Edison (PECO), which reported blended spreads of 20.1% in Q2. SITE Centers (SITC) also reported impressive leasing results with its highest quarterly new leasing volume since early 2017. Total leased occupancy rates improved 180 basis points from the prior year and 40 basis points sequentially in Q2 with notable improvement in the quarter from InvenTrust (IVT) and Urban Edge (UE) along with Kite Realty and SITE Centers. Small-shop occupancy improvement has been a key contributor to the earnings beats in recent quarters - a trend that continued in Q2 with a 309 basis point average rise in occupancy. Adding some color to the small-shop trends on its earnings call, Kite Realty noted that its "still seeing a healthy appetite" for small shops despite the macro headwinds and noted that its occupancy is still 320 basis points below the high-level mark prior to the pandemic "which shows a lot of growth yet to come." Shopping Center REIT Performance A common theme across the shopping center sector over the past several years, new reasons for caution always seem to emerge just as investors were starting to feel confident in the outlook and mounting recession concerns have kept a lid on the performance in recent months despite the strong earnings results. Shopping Center REITs are still among the stronger-performing sectors so far in 2022 with price returns of -26.4% compared to the 32.9% decline from the Vanguard Real Estate ETF (VNQ) and 22.4% decline from the S&P 500 (SPY). After plunging more than 50% early in the pandemic, shopping center REITs have been one of the better-performing property sectors since the initial vaccine announcements in mid-November 2020. Shopping center REITs snapped a five-year streak of underperformance in 2021 with total returns of more than 65%, significantly outpacing the 41% total returns from the broad-based Equity REITs Index. Diving deeper into the company-level performance, all fifteen shopping center REITs are in negative territory this year, but upside standouts have included the pair REITs that went public last year - Phillips Edison and InvenTrust - as well as Urstadt Biddle (UBA), which has rallied since launching a sizable stock buyback program last month. Performance trends since the start of the pandemic closely mirrored balance sheet quality more than any other factor as the eight REITs with investment-grade S&P credit ratings have delivered double-digit outperformance relative to their non-investment-grade peers over this time. Balance sheet metrics - particularly the critical Debt/EV Ratio metric - have improved considerably as share prices have rebounded and all but one REIT - WSR - are now trading with Debt Ratios below 50%, down from 15 REITs at the end of 2020. Shopping Center M&A and External Growth A sharp disconnect had persisted between private market valuations of retail real estate assets and the REIT-implied valuation, forcing retail REITs to be net sellers of assets for nearly a half-decade. The tide turned a bit during the pandemic, however, as shopping center REITs became net buyers for the first time since 2016, acquiring $4.45B in assets during the year while selling $3.14B for a net positive total of $1.31B. Nevertheless, a pair of small-cap REITs that traded at persistent Net Asset Value discounts headed for the exits - recognizing significant shareholder value in the process: Retail Value (RVI) sold the majority of its portfolio in two separate transactions while Cedar Realty sold the majority of its portfolio before being acquired by Wheeler (WHLR). Before the surge in interest rates over the past six months, the "animal spirits" had come alive across the shopping center REIT sector with several mergers, two new listings, and the highest level of acquisitions since the mid-2010s. Kimco Realty and Weingarten Realty closed on their merger last August while Kite Realty closed on its acquisition of Retail Properties of America last October. Back in March, Cedar Realty was acquired by small-cap diversified REIT Wheeler Real Estate. Two sizable new public REITs have emerged as well, graduating from the "non-traded" REIT ranks: InvenTrust Properties went public through a "Dutch Auction" last October while Phillips Edison went public through an IPO last July. Importantly, after a development boom during the 1990s and early 2000s, a limited amount of new retail space has been created since the Financial Crisis and the retail development pipeline remains almost non-existent, declining another 12.1% in 2021 to its lowest level in nearly 20 years. Despite that, the US still has more retail square footage per capita than any other country in the world, but the gap between total spending and square footage has narrowed rather significantly over the past half-decade. The majority of new retail development by shopping center REITs has been through redevelopment or modest expansions of existing properties with only a handful of complete ground-up construction. Deeper Dive: Retail Sales & Omnichannel Powered by WWII levels of fiscal stimulus, retail sales set record-after-record throughout 2021 and into early 2022, and while the stimulus-fueled spending spree has certainly moderated over the past several months, retailers are generally far healthier now than they were before the pandemic. Regaining all of the lost ground during the pandemic by early 2021, the strength in retail sales over the past two years has been led by many of the "big box" categories including home improvement, general merchandise, grocery, sporting goods, electronics/appliances, and home furnishings stores. The Census Bureau reported last week that retail sales were still 8.2% higher on a year-over-year basis despite several months of depression-like levels of consumer sentiment. It took a few years, but Big Box retailers have learned to compete effectively in the e-commerce era. Despite their slide in the past month, the ten largest brick-and-mortar retailers have posted average returns of roughly 30% since the start of 2020. While the momentum slowed in 2022 amid inflation challenges and the waning of stimulus, profitability metrics from Home Depot (HD) and Lowe's (LOW) were historically strong in late 2021 and into early 2022, as were earnings results from many of the largest "big-box" general merchandise retailers including Walmart (WMT), Costco (COST), and Target (TGT). The large publicly traded grocers have also seen renewed strength driven by the pandemic including Albertsons - which has surged more than 80% since its listing in June 2020, and its potential acquirer Kroger - which has gained 40% over this time. The growing usage of alternative (and higher-margin) "delivery" options including in-store pickup, "curbside" pickup, and delivery-from-store have been a tailwind for well-located shopping center REITs. Shopping centers have increasingly become hybrid distribution centers in a decentralized third-party delivery network powering "same-hour" delivery to challenge Amazon's (AMZN) dominance in ultra-fast delivery. The pandemic significantly accelerated retailers' investment in their in-store order fulfillment platforms which have evolved from a pure "click and collect" model into a multi-channel "last-mile" delivery network supplemented by delivery platforms like Uber (UBER), Postmates (POSTM), and DoorDash (DASH) as the food delivery model is becoming more ubiquitous across all retail categories. Shopping Center REIT Dividend Yields Powered by a wave of fifteen dividend increases this year, shopping center REITs currently pay an average dividend yield of 5.0%, which is well above the market-cap-weighted REIT sector average of 4.1%. Shopping center REITs pay out only about half of their FFO, leaving significant embedded upside potential for dividend growth - and a solid cushion for dividend protection if economic conditions take a turn for the worse. Diving deeper into the sector, we note that dividend yields range from a sector-high of 6.32% and 6.10% from small-caps Saul Centers (BFS) and RPT Realty (RPT) to a sector-low of 3.65% from InvenTrust. Notably, three REITs in the sector have recorded positive dividend growth over each of the one, three, and five-year time horizons - Regency Centers (REG), Federal Realty (FRT), and Saul Centers. Notably, Federal Realty's dividend hike this year marked the 55th consecutive year that FRT has raised its dividend - the longest record of consecutive annual dividend increases in the REIT sector. Key Takeaways: High-Quality At A Discount For shopping center REITs, the versatility and larger footprint of the strip center format have been a winning formula as retailers have increasingly utilized their brick-and-mortar properties as hybrid "distribution centers" in last-mile delivery networks. After a surge in store closings during the pandemic, the number of store openings has outpaced closings by nearly 2x since early 2021 with particular strength in larger-format strip centers. As a result, shopping center fundamentals are now as strong – if not stronger - than before the pandemic, underscored by a rise in occupancy rates to the highest level since early 2015 while all fifteen REITs in the sector have raised their dividends in each of the past two years - one of just three property sectors that can make that claim. High-quality strip centers remain one of our favorite "value-oriented" property sectors given their 'embedded' dividend growth potential and solid positioning for a variety of economic scenarios. For an in-depth analysis of all real estate sectors, be sure to check out all of our quarterly reports: Apartments, Homebuilders, Manufactured Housing, Student Housing, Single-Family Rentals, Cell Towers, Casinos, Industrial, Data Center, Malls, Healthcare, Net Lease, Shopping Centers, Hotels, Billboards, Office, Farmland, Storage, Timber, Mortgage, and Cannabis. Disclosure: Hoya Capital Real Estate advises two Exchange-Traded Funds listed on the NYSE. In addition to any long positions listed below, Hoya Capital is long all components in the Hoya Capital Housing 100 Index and in the Hoya Capital High Dividend Yield Index. Index definitions and a complete list of holdings are available on our website. Read The Full Report on Hoya Capital Income Builder Amid the historic market volatility - and persistent inflation - our focus at Income Builder is on real income-producing asset classes that offer the opportunity for reliable income, diversification, and inflation hedging. Get started today with a Free Two-Week Trial and you can take a look at our top ideas - including our new Landowner Portfolio - and see what we're investing in to help build sustainable portfolio income. Subscribers gain complete access to our investment research and our suite of trackers and income-focused portfolios targeting premium dividend yields up to 10% across real income-producing asset classes. This article was written by Real Estate • High Yield • Dividend Growth Visit www.HoyaCapital.com for more information and important disclosures. Hoya Capital Research is an affiliate of Hoya Capital Real Estate ("Hoya Capital"), a research-focused Registered Investment Advisor headquartered in Rowayton, Connecticut. Founded with a mission to make real estate more accessible to all investors, Hoya Capital specializes in managing institutional and individual portfolios of publicly traded real estate securities, focused on delivering sustainable income, diversification, and attractive total returns.Collaborating with ETF Monkey, Retired Investor, Gen Alpha, Alex Mansour, The Sunday Investor, and Philip Eric Jones for Marketplace service - Hoya Capital Income Builder. Hoya Capital Real Estate ("Hoya Capital") is a registered investment advisory firm based in Rowayton, Connecticut that provides investment advisory services to ETFs, individuals, and institutions. Hoya Capital Research & Index Innovations is an affiliate that provides non-advisory services including research and index administration focused on publicly traded securities in the real estate industry. This published commentary is for informational and educational purposes only. Nothing on this site nor any commentary published by Hoya Capital is intended to be investment, tax, or legal advice or an offer to buy or sell securities. This commentary is impersonal and should not be considered a recommendation that any particular security, portfolio of securities, or investment strategy is suitable for any specific individual, nor should it be viewed as a solicitation or offer for any advisory service offered by Hoya Capital. Please consult with your investment, tax, or legal adviser regarding your individual circumstances before investing. The views and opinions in all published commentary are as of the date of publication and are subject to change without notice. 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I have no business relationship with any company whose stock is mentioned in this article. Hoya Capital Research & Index Innovations (“Hoya Capital”) is an affiliate of Hoya Capital Real Estate, a registered investment advisory firm based in Rowayton, Connecticut that provides investment advisory services to ETFs, individuals, and institutions. Hoya Capital Research & Index Innovations provides non-advisory services including market commentary, research, and index administration focused on publicly traded securities in the real estate industry. This published commentary is for informational and educational purposes only. Nothing on this site nor any commentary published by Hoya Capital is intended to be investment, tax, or legal advice or an offer to buy or sell securities. This commentary is impersonal and should not be considered a recommendation that any particular security, portfolio of securities, or investment strategy is suitable for any specific individual, nor should it be viewed as a solicitation or offer for any advisory service offered by Hoya Capital Real Estate. Please consult with your investment, tax, or legal adviser regarding your individual circumstances before investing. The views and opinions in all published commentary are as of the date of publication and are subject to change without notice. Information presented is believed to be factual and up-to-date, but we do not guarantee its accuracy and it should not be regarded as a complete analysis of the subjects discussed. Any market data quoted represents past performance, which is no guarantee of future results. There is no guarantee that any historical trend illustrated herein will be repeated in the future, and there is no way to predict precisely when such a trend will begin. There is no guarantee that any outlook made in this commentary will be realized. Readers should understand that investing involves risk and loss of principal is possible. Investments in real estate companies and/or housing industry companies involve unique risks, as do investments in ETFs. The information presented does not reflect the performance of any fund or other account managed or serviced by Hoya Capital Real Estate. An investor cannot invest directly in an index and index performance does not reflect the deduction of any fees, expenses or taxes. Hoya Capital Real Estate and Hoya Capital Research & Index Innovations have no business relationship with any company discussed or mentioned and never receive compensation from any company discussed or mentioned. Hoya Capital Real Estate, its affiliates, and/or its clients and/or its employees may hold positions in securities or funds discussed on this website and our published commentary. A complete list of holdings and additional important disclosures is available at www.HoyaCapital.com. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (7)

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3 Retail Pharmacy and Drugstore Stocks to Watch Amid Industry Challenges

The Zacks Retail Pharmacy and Drugstore industry players like CVS, WBA and RAD are likely to gain from the growing demand for digital healthcare support. However, reimbursement challenges are hurting overall industry health.

Yahoo

3 Retail Pharmacy and Drugstore Stocks to Watch Amid Industry Challenges The past couple of years of healthcare emergency has significantly altered the structure and trend of the Retail - Pharmacies and Drug Stores industry. On a positive note, amid the supply-chain disruption and staffing shortages within healthcare, the retail pharmacy business has been in high demand, thanks to the exponentially growing demand for distant medical services and remote patient care. Particularly, mail-order pharmacies are registering growth on account of telehealth and remote monitoring services, creating unique opportunities for stalwarts within the industry like CVS Health CVS, Walgreens Boots Alliance WBA and Rite Aid RAD, which invested strategically in easy patient access to prescription and maintenance medications during this period. However, the majority of the retail drug store heavyweights have been southbound on the ongoing pressure of drug pricing and reimbursement. Further, with a decline in the severity of COVID-19, the demand for related retail health support has decreased meaningfully, resulting in a significant drop in pandemic-led revenue generation for the industry players. Last but not the least, perceiving the huge growth prospects of this space, there has been a number of new entries in this industry, increasing the competitiveness of the space. Especially, a stalwart like Amazon’s AMZN entry into the retail drugstore space has created a survival issue among the existing entities. Industry Description The Zacks Retail - Pharmacies and Drug Stores industry includes retailing of a range of prescription and over-the-counter medications. The broad retail network of companies within the retail pharmacy industry delivers advanced health solutions to patients, customers and caregivers. Over the past few years, the scope of the retail pharmacy and drugstore market has expanded exponentially. In North America, some of these entities evolved to add wellness products and groceries to their traditional portfolio of prescription and over-the-counter medications. According to recent reports, CVS Health, Walgreens Boots and Rite Aid are among the "big three" in the drugstore space. However, non-healthcare leaders like Amazon, in 2018, acquired pharmacy delivery startup PillPack to enter the U.S. healthcare space. 3 Trends Shaping the Future of the Retail - Pharmacies and Drug Stores Industry Industry Trend Remains Dismal Amid Reimbursement Pressure: Brand-name drugs, which hold wide profit margins, are protected with a reliable supply chain. However, the low-margin generic drugs, which have a fragile supply chain network, have been bearing the brunt of the pandemic-induced economic slump. Drug retailers are also witnessing a constant rise in medicine prices, stemming from the rising cost of raw materials of drugs. The industry players are currently grappling with continued pressure from non-reimbursable pharmacy expenses, which are significantly pulling down the mass demand for prescription as well as over-the-counter drugs and vaccinations. It has been widely observed that patients are replacing prescription medicines with low-cost generic drugs. Threat of Amazon Entering Brick-And-Mortar: A Business Insider report on May 26, 2021 came up with the speculation that there have been discussions about Amazon setting up stand-alone stores in a few locations, including Boston and Phoenix. Further, per the report, which cites insider sources, Amazon is exploring plans to place the pharmacies inside Amazon-owned Whole Foods locations. Earlier, following its entry, the e-commerce giant grabbed a significant chunk of the online pharmacy market from the legacy retail drug store space. Needless to say, this latest speculation has come as a major blow to the industry, putting retail pharmacy and drugstore stocks in a tighter spot. Online Pharmacy and Mail Order Boom: The widespread shelter-in-place regulations since the beginning of the pandemic have created a significant shift in demand toward mail order and online pharmacies. Experts say that this transition is expected to last even after the pandemic is over. Data claims that COVID-19 has only accelerated the already-growing demand for e-pharmacy and mail-ordered home delivery systems. Going by a Patch report, “Two years ago, 11% of U.S. adult pharmacy customers got their prescription from an online pharmacy, based on a survey conducted by market research firm CivicScience, [.] That figure has been steadily rising over the years, according to Statista.com, an online statistics portal.” With Amazon’s big move into the healthcare space, the retail pharmacy industry entered a new phase of fierce competition. To counter this rivalry, the companies are strategically attempting to gain in size and scale. Zacks Industry Rank Indicates Dull Near-Term Prospects The industry’s Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates bleak near-term prospects. The Zacks Retail - Pharmacies and Drug Stores industry, housed within the broader Zacks Retail and Wholesale sector, currently carries a Zacks Industry Rank #174, placing it in the bottom 31% of more than 250 Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperforms the bottom 50% by a factor of more than 2 to 1. We will present a few stocks that have the potential to outperform the market based on a strong earnings outlook. But it’s worth taking a look at the industry’s shareholder returns and current valuation first. Industry Outperforms S&P 500 & Sector The Zacks Retail - Pharmacies and Drug Stores industry has outperformed the Zacks S&P 500 composite as well as its sector over the past year. The stocks in this industry have collectively lost 6.6% over this period, while the Retail-Wholesale Sector has declined 31.6%. The S&P 500 composite has declined 19.8% over the said time frame. One-Year Price Performance Industry's Current Valuation On the basis of forward 12-month price-to-earnings (P/E), which is commonly used for valuing medical stocks, the industry is currently trading at 9.3X compared with the S&P 500’s 16.01X and the sector’s 20.06X. Over the last five years, the sector has traded as high as 12.63X, as low as 7.53X, and at the median of 10.00X, as the charts below show. Price-to-Earnings Forward Twelve Months (F12M) Price-to-Earnings Forward Twelve Months (F12M) 3 Retail - Pharmacies and Drug Stores Stocks in Focus CVS Health: CVS Health is currently seeing greater engagement in an expanded set of digital health services such as antibody and PCR testing, vaccinations and omni-channel pharmacy. CVS.com is one of the top health websites, with more than 2 billion visits last year, up nearly 55% over the prior year. CVS Health’s digital capabilities for health interactions such as COVID testing and vaccines, prescription services, and sales of health and wellness products have dramatically increased consumer engagement across all CVS Health businesses. The Zacks Consensus Estimate for 2022 revenues indicates a 6.7% rise from 2021. CVS Health, a Zacks Rank #3 (Hold) stock, has risen 3.9% in the past year. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Price and Consensus: CVS Walgreens Boots: Walgreens Boots continues to make progress in transforming the pharmacy business and the method of delivering healthcare, both through physical stores and digital channels. Currently, the company’s U.S. retail business is demonstrating good momentum through digital and omnichannel growth from the myWalgreens loyalty program, owned brand innovation and alternative profit streams. In the last-reported third-quarter of fiscal 2022, the company experienced improved online growth momentum, with digital sales up 25% in the United States. Robust performance across health and wellness and personal care categories during the quarter instilled optimism. The Zacks Consensus Estimate for fiscal 2023 revenues indicates a rise of 0.01% from fiscal 2022. However, the long-term expected earnings growth rate is pegged at an impressive 5%. Walgreens Boots, a Zacks Rank #3 stock, has lost 31.9% in the past year. Price and Consensus: WBA Rite Aid: Rite Aid remains focused on strengthening its foothold in mid-market PBM, innovating across its retail and mail-order pharmacy channels, enhancing the in-store experience by curated digital offerings, improving merchandise and rebranding its image with a new logo. Rite Aid earlier launched the first three Stores of the Future and successfully concluded the acquisition of Bartell, which will help expand its customer base. The company revealed plans to lower costs via the closure of 145 unprofitable stores, reduced corporate administrative expenses and enhanced efficiencies in worked payroll, and other store labor costs. It also intends to reduce costs related to Elixir due to declining membership. The Zacks Consensus Estimate for fiscal 2024 revenues indicates a rise of 95.9% from fiscal 2023. Rite Aid, a Zacks Rank #3 stock, has lost 71.7% in the past year. Price and Consensus: RAD Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CVS Health Corporation (CVS) : Free Stock Analysis Report Rite Aid Corporation (RAD) : Free Stock Analysis Report Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Walgreens Boots Alliance, Inc. (WBA) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research

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Hawaiian Airlines Shares Fly High On Amazon Relationship

Hawaiian Holdings Inc (NASDAQ: HA) has agreed with Amazon.com Inc (NASDAQ: AMZN) to operate and maintain an initial fleet of 10 Airbus SE (OTC: EADSY) A330-300 freighters starting in the fall of 2023. Hawaiian will maintain and fly Amazon's A330s under its FAA air carrier certificate to move cargo between airports near Amazon's operations facilities. The initial 10 aircraft will enter into service in 2023 and 2024. The agreement also has the option to expand the fleet depending on Amazon's futur

Yahoo

Hawaiian Airlines Shares Fly High On Amazon Relationship Hawaiian Holdings Inc (NASDAQ: HA) has agreed with Amazon.com Inc (NASDAQ: AMZN) to operate and maintain an initial fleet of 10 Airbus SE (OTC: EADSY) A330-300 freighters starting in the fall of 2023. Hawaiian will maintain and fly Amazon's A330s under its FAA air carrier certificate to move cargo between airports near Amazon's operations facilities. The initial 10 aircraft will enter into service in 2023 and 2024. The agreement also has the option to expand the fleet depending on Amazon's future business needs. Hawaiian intends to establish a pilot base on the continental U.S., grow existing maintenance bases, and expand the hiring of pilots, mechanics, dispatchers, and supply chain employees. In connection with the commercial agreement, the Hawaiian issued Amazon warrants to acquire up to 15% of its common shares. The warrants are exercisable over the next 9 years. "This relationship provides a catalyst to grow our business and the unique opportunity to diversify our revenue sources while capitalizing on our established strengths," said CEO Peter Ingram. Also Read: Amazon Faces £900M UK Antitrust Class Action For Algorithm Abuse Price Action: HA shares are trading higher by 13.42% at $15.98 on the last check Friday. Photo Via Company See more from Benzinga Walmart Looks To Intensify Strategy In Africa Despite A Series Of Missteps Credit Suisse Hopes On Colgate-Palmolive's Underlying Strength Despite FX Risk Don't miss real-time alerts on your stocks - join Benzinga Pro for free! Try the tool that will help you invest smarter, faster, and better. © 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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What Lies Ahead for Big Tech ETFs in Q3 Earnings?

Most of the tech titans are expected to report slowing profit and revenue growth, or even year-over-year declines, for the three months ending in September, according to the analyst estimates.

Yahoo

What Lies Ahead for Big Tech ETFs in Q3 Earnings? We are in the peak of the third-quarter earnings season and tech giants are in the spotlight next week. The five biggest tech players — Apple AAPL, Amazon AMZN, Meta Platforms META, Alphabet GOOGL and Microsoft MSFT — are set to report. These five companies currently account for about 23% of the total market capitalization of the S&P 500 Index. Most of these are expected to report slowing profit and revenue growth, or even year-over-year declines, for the three months ending in September, according to the analyst estimates. The technology sector, which was hit the hardest by soaring yields and a hawkish Fed, has shown some strength lately. However, their earnings are expected to take a hit from the strength in the U.S. dollar, which is currently trading at its highest level in two decades (read: Dollar at 20-Year High: ETFs to Gain & Lose). Both Microsoft and Alphabet are scheduled to release their earnings on Oct 25, while Meta Platforms and Apple will report on Oct 26 and Oct 27, respectively. Amazon is also slated to report on Oct 27. Microsoft Microsoft has a Zacks Rank #4 (Sell) and an Earnings ESP of -0.65%. According to our methodology, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. The Zacks Consensus Estimate indicates substantial earnings growth of 1.3% and revenue growth of 9.4% from the year-ago quarter. Microsoft’s earnings track is impressive, with the last four-quarter earnings surprise being 4.53%, on average. However, the stock witnessed negative earnings estimate revision of a penny for the to-be-reported quarter over the past 30 days. Analysts decreasing estimates right before earnings — with the most up-to-date information possible — is not a good indicator for the stock. Microsoft belongs to a top-ranked Zacks industry (top 33%) and has lost about 12% over the past three months (see: all the Technology ETFs here). Alphabet Alphabet has a Zacks Rank #3 and an Earnings ESP of -2.07%. It saw no earnings estimate revision over the past seven days for the to-be-reported quarter. The company’s earnings surprise track over the past four quarters is good, with the beat being 6.77%, on average. Earnings are expected to decline 10.7%, while revenues are expected to grow 8.8% from the year-ago quarter. Alphabet falls under a top-ranked Zacks industry (top 20%). The Internet behemoth has shed about 12% in the past three months (read: Apple ETFs in Focus Post iPhone 14 Launch). Meta Platforms Meta Platforms has a Zacks Rank #4 and an Earnings ESP of -3.21%. The social media giant saw a negative earnings estimate revision of couple of cents for the to-be-reported quarter over the past seven days. The current Zacks Consensus Estimate for the yet-to-be reported quarter indicates a substantial year-over-year earnings decline of 43.5%. Revenues are expected to decrease 5.4%. Meta Platforms delivered an earnings surprise of 0.80%, on average, in the last four quarters. The stock belongs to a top-ranked Zacks industry (top 27%). Shares of META have lost about 21% in the past three months. Apple Apple has a Zacks Rank #3 and an Earnings ESP of +0.79%. The stock saw positive earnings estimate revision over the past 30 days for fourth-quarter fiscal 2022, and its earnings surprise history is strong. It delivered an earnings surprise of 5.67%, on average, over the past four quarters. Apple is expected to report a modest earnings growth of 1.6% from the year-ago quarter and revenues are expected to increase 6.1% year over year. It belongs to a bottom-ranked Zacks industry (bottom 6%). The stock has declined 8% in the past three-month timeframe. Amazon Amazon has a Zacks Rank #4 and an Earnings ESP of -27.66%. The stock saw a positive earnings estimate revision of a penny over the past 30 days for the third quarter. The Zacks Consensus Estimate represents a substantial year-over-year earnings decline of 22.6% and revenue growth of 15.6%. Amazon’s earnings surprise history is impressive, with an average beat of 124.7% for the last four quarters. The stock falls under a top-ranked Zacks industry (top 20%). The online e-commerce behemoth has witnessed a share price fall of 5% in the past three months. ETFs to Tap Given this, investors may want to play these stocks with the help of ETFs. Below, we have highlighted six ETFs having the largest exposure to these tech giants. MicroSectors FANG+ ETN FNGS: This ETN is linked to the performance of the NYSE FANG+ Index, which is equal-dollar weighted and designed to provide exposure to a group of highly traded growth stocks of next-generation technology and tech-enabled companies. The note accounts for a 10% share in each of the FAANG stocks and has a Zacks ETF Rank #3 (read: Netflix Returns to Growth, Shares Spike: ETFs to Tap). Blue Chip Growth ETF TCHP: This fund focuses on companies with leading market positions, seasoned management and strong financial fundamentals. It accounts for a combined 46.6% in the five firms. Vanguard Mega Cap Growth ETF MGK: This ETF offers exposure to the largest growth stocks in the U.S. market and has a Zacks ETF Rank #3. The five firms account for a combined 42.9% share in the basket. iShares Evolved U.S. Technology ETF IETC: This fund employs data science techniques to identify companies with exposure to the technology sector. The five firms account for a combined 42.9% share in the basket. Invesco QQQ QQQ: This ETF focuses on 100 of the largest domestic and international nonfinancial companies listed on the Nasdaq Stock Market based on market capitalization. This fund makes up for 37.3% share in the in-focus firms and has a Zacks ETF Rank #3 with a Medium risk outlook. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report Invesco QQQ (QQQ): ETF Research Reports Alphabet Inc. (GOOGL) : Free Stock Analysis Report Vanguard Mega Cap Growth ETF (MGK): ETF Research Reports iShares Evolved U.S. Technology ETF (IETC): ETF Research Reports MicroSectors FANG ETN (FNGS): ETF Research Reports T. Rowe Price Blue Chip Growth ETF (TCHP): ETF Research Reports Meta Platforms, Inc. (META) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research

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Wall Street surges to sharply higher close ahead of Fed week

A robust, broad-based rally sent Wall Street to a sharply higher close on Friday as encouraging economic data and a sunnier earnings outlook fueled investor risk appetite ahead of next week's much-anticipated two-day policy meeting of the Federal Reserve.

Reuters

Wall Street surges to sharply higher close ahead of Fed week - Summary - Companies - Apple rebounds, Amazon sinks after earnings reports - Data shows strong consumer spending, ebbing wage growth - Third-quarter aggregate earnings estimates raised - Dow notches best weekly percentage gain since May - Indexes jump: Dow 2.59%, S&P 2.46%, Nasdaq 2.87% NEW YORK, Oct 28 (Reuters) - A robust, broad-based rally sent Wall Street to a sharply higher close on Friday as encouraging economic data and a sunnier earnings outlook fueled investor risk appetite ahead of next week's much-anticipated two-day policy meeting of the Federal Reserve. All major U.S. indexes ended the session up about 2.5% or more, with the S&P and the Nasdaq notching their second straight weekly gains. The blue-chip Dow posted its fourth consecutive Friday-to-Friday advance and its biggest weekly percentage gain since May. "This has been one of the best months (so far) in the history of the Dow, suggesting the bear market likely ended," said Ryan Detrick, chief market strategist at Carson Group in Omaha. "Big monthly moves historically happen at the end of bear markets." "This is the second Friday in a row we’ve seen aggressive buying suggesting investors are growing more comfortable holding over the weekend," Detrick added. A 7.6% rebound in Apple Inc(AAPL.O) helped soften the blow of the 6.8% plunge for Amazon.com(AMZN.O) shares, in the wake of the two market leaders' results. Solid earnings beats from Chevron (CVX.N), Exxon Mobil (XOM.N) and other companies outside the tech and tech-adjacent megacap group have brightened aggregate earnings estimates for the quarter. Analysts now see third-quarter S&P 500 earnings growth of 4.1%, up from 2.5% on Thursday, according to Refinitiv data. "We’ve seen some high-profile misses from significant large-cap names," Detrick said. "But under the surface many of the smaller and midsize companies have been quite impressive with their earnings results." On the economics front, the Commerce and Labor Departments released data that showed robust consumer spending and easing wage growth, respectively. Financial markets have now priced in an 84.5% likelihood of a fifth consecutive 75 basis point interest rate hike at the conclusion of the Fed's Nov. 1-2 policy meeting, and a 51.4% chance the central bank will decelerate to 50 basis points in December, according to CME's FedWatch tool. "The door is cracked open on the possibility that we might see a more dovish Fed come December’s policy meeting, whereas a month ago that door was locked and slammed shut," Detrick added. The Dow Jones Industrial Average (.DJI) rose 828.52 points, or 2.59%, to 32,861.8, the S&P 500 (.SPX) gained 93.76 points, or 2.46%, to 3,901.06 and the Nasdaq Composite (.IXIC) added 309.78 points, or 2.87%, to 11,102.45. Of the 11 major sectors of the S&P 500, all but consumer discretionary stocks (.SPLRCD), weighed down by Amazon shares, ended the session green. Tech shares (.SPLRCT) enjoyed the largest percentage gain. Third-quarter reporting season has passed the halfway point, with 263 of the companies in the S&P 500 having reported. Of those, 73% have beaten consensus expectations, according to Refinitiv. Intel Corp (INTC.O) jumped 10.7% after cutting its spending forecast, while T-Mobile US Inc's (TMUS.O) subscriber forecast hike sent its shares up 7.4%. Twitter Inc was delisted from the New York Stock Exchange, closing the book on Tesla Inc (TSLA.O) chief Elon Musk's $44 billion purchase of the company. Advancing issues outnumbered declining ones on the NYSE by a 2.87-to-1 ratio; on Nasdaq, a 2.12-to-1 ratio favored advancers. The S&P 500 posted 32 new 52-week highs and eight new lows; the Nasdaq Composite recorded 117 new highs and 115 new lows. Volume on U.S. exchanges was 11.26 billion shares, compared with the 11.53 billion average over the last 20 trading days. Our Standards: The Thomson Reuters Trust Principles.

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Amazon shares slump, Big Tech peers stay afloat

Amazon.com Inc's shares fell about 8% on Friday after forecasting holiday-quarter sales below Wall Street estimates, while its Big Tech peers recovered from a bruising selloff this week.

Reuters

Amazon shares slump, Big Tech peers stay afloat Oct 28 (Reuters) - Amazon.com Inc's (AMZN.O) shares fell about 8% on Friday after forecasting holiday-quarter sales below Wall Street estimates, while its Big Tech peers recovered from a bruising selloff this week. The online retailer, whose market cap briefly fell below $1 trillion, was last down 8.4% at $101.66, after hitting its lowest since April 2020. Apple Inc (AAPL.O), however, shone bright amid a crowd of dimming lights in the Big Tech space, as the iPhone maker reported revenue and profit that topped analysts' estimates. Microsoft, Alphabet and Meta gained between 1.2% and 3.1% after their shares were battered this week following gloomy outlook from the companies. The Big Tech stocks are on track to lose more than $400 billion this week. Many view the megacap companies as bellwethers for how corporate America is faring during a year in which inflation has soared, pushing the U.S. Federal Reserve to enact a series of jumbo-sized rate hikes that have bruised markets. Analysts fear macroeconomic factors, including a strong dollar, will continue to hit Amazon in the near term, however, over a longer period of time, the retailer should be able to bounce back. "Despite accelerating revenues, Amazon has been cut down to size by the market after missing expectations. Efficiency has yet to return to the e-commerce business," Ben Barringer, equity research analyst at Quilter Cheviot, said. While the cloud services segment has been one of high and sustained growth for tech companies, indications for Amazon, Microsoft and Intel Corp (INTC.O) this week point to lower investments as costs rise. Intel's shares rose about 7% after the chipmaker said its cost-reduction plan includes layoffs and is expected to lower costs by $3 billion next year. However, analysts are cautious of how the company plans to cut costs. Cost reductions are necessary, but Intel needs to focus on cutting spending in the right places and keep research and development investments high, Glenn O'Donnell, research director at Forrester, said. Our Standards: The Thomson Reuters Trust Principles.

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The Dow Is Having a Great Month, the Nasdaq Is Having a Good One. What History Says Happens Next.

The Nasdaq has been hammered by some of its biggest tech stocks, drawing comparisons to the dot-com bubble and bust. The problem: Big Tech is still pricey.

MarketWatch

There’s nothing worse than kicking someone when they’re down—but sometimes it needs to be done. That’s the case with the Nasdaq Composite, which is on pace to lag behind the Dow Jones Industrial Average in October by the most in any one month since 2002, and could keep bringing up the rear. There’s no denying that the stock market did very well last week. The Dow gained 5.7%, while the S&P 500 rose 4%, and the Nasdaq advanced 2.2%. It was the Dow’s fourth consecutive week of gains. And what a four weeks it has been. The Dow has jumped 14% in October and is on pace for its best month since January 1976, when the blue-chip benchmark surged 14.4%. The other indexes have fallen short of those gains: The Russell 2000 climbed 11%, the S&P 500 gained 8%, and the Nasdaq Composite rose a paltry 3.9%. Monday’s drop—the Dow declined 0.4%, while the S&P 500 fell 0.8%, and the Nasdaq dropped 0.1%--only made the gap wider. That kind of outperformance by the Dow against the Nasdaq doesn’t happen very often. The Dow has outperformed the Nasdaq by more than nine percentage points this month, the most since February 2002, when it outperformed by 12.35 percentage points, and the seventh-largest monthly gap in 45 years. Monday’s losses—the Dow is off Blame the Nasdaq’s underperformance on its biggest stocks. This past week saw Meta Platforms (ticker: META) shed 24% of its value, while Alphabet (GOOGL) dropped 4.8%, Amazon.com (AMZN) fell 13%, and Microsoft (MSFT) slid 2.6%, all after reporting earnings. Only Apple (AAPL), which rose 5.8% after reporting its results, finished the week higher, though it is down 1.1% on Monday. “This really is the first time in 20 years that investors in technology have had their assumptions of effortless outperformance challenged to this degree,” writes Michael Shaoul, CEO of Marketfield Asset Management. History suggests that the Nasdaq’s underperformance can continue. The Dow beat the Nasdaq by at least seven percentage points in 1978, 1980, and 1992, but most months of Dow dominance came during the popping of the dot-com bubble—a total of 12 from 1999 through 2002. Following one-offs in 1978, 1980, and 1992, the S&P 500 went on to rally by an average of 9.5% over the next six months. During the dot-com bust, the S&P 500 averaged a 9.9% decline following a month of Dow dominance. The truth may be somewhere in between. Marta Norton, chief investment officer for the Americas at Morningstar Investment Management, says euphoria around tech resembles the dot-com boom, but just the fact that we call it Big Tech suggests a major difference in quality between now and then. Unfortunately, many of these stocks still look expensive. “We want to buy them,” Norton says. “But we want to buy them when they’re cheap, and not before then.” Write to Ben Levisohn at Ben.Levisohn@barrons.com

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Italian court suspends decision on Amazon's record fine appeal

An Italian court has suspended a decision on a request by e-commerce giant Amazon to annul a record 1.13 billion euro ($1.12 billion) fine imposed by Italy's antitrust watchdog for alleged abuse of market dominance, a court ruling showed on Friday.

Reuters

Italian court suspends decision on Amazon's record fine appeal ROME, Oct 28 (Reuters) - An Italian court has suspended a decision on a request by e-commerce giant Amazon (AMZN.O) to annul a record 1.13 billion euro ($1.12 billion) fine imposed by Italy's antitrust watchdog for alleged abuse of market dominance, a court ruling showed on Friday. Italian administrative court TAR del Lazio said it had suspended judgment pending a ruling by the European Union Court of Justice over the case. A legal source said the EU court might rule on the ongoing case before the next summer. Last year Italy's competition watchdog ruled that Amazon had used its dominant position in the Italian market for intermediation services on marketplaces to favour the adoption of its own logistics service by sellers active on Amazon.it. It subsequently imposed one of the highest penalties on a U.S. tech giant in Europe. An Amazon spokesperson reiterated that the company strongly disagreed with the decision of the Italian Competition Authority (ICA) and would continue to emphasise its position throughout the legal proceedings. "More than half of all annual sales on Amazon in Italy come from SMBs. We have 20,000 Italian SMBs that sell on Amazon, including sellers that manage shipment themselves, and we constantly invest to support their growth", the spokesperson said in a statement. The watchdog declined to comment. ($1 = 1.0054 euros) Our Standards: The Thomson Reuters Trust Principles.

AMZN

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A $3 trillion loss: Big Tech's horrible year is getting worse

Big Tech companies took a heavy beating this week, to the tune of more than $255 billion in lost market capitalization that helped make a bad year even worse...

MarketWatch

Big Tech companies are taking a heavy beating this week, to the tune of more than $255 billion in lost market capitalization that’s helped make a bad year even worse for the once-beloved sector. The five tech giants that posted results this week have now lost a combined $3 trillion in market cap on the year, according to Dow Jones Market Data, showing that Big Tech isn’t immune to the macroeconomic storm sweeping up the broader stock market. Facebook in freefall: 5 charts that show Meta’s financial collapse The Big Five tech companies—Alphabet Inc. GOOG, Even more concerning this quarter, though, was the steep fall in net income seen nearly across the board. The five reported combined net income of $59.5 billion, down 17.8% from the $72.3 billion they logged a year before. In that year-ago quarter, income growth at the Big Five soared 39.1% in aggregate, even as Amazon’s saw its profit halved. On the whole, the Big Five raked in $1.08 trillion in revenue through the first nine months of the year, up 9.2% from a year before, though both net income and free-cash flow turned lower. The gang recorded $178 billion in aggregate net income in the first three quarters of 2022, down 19.7% from a year before, along with $150 billion in free-cash flow, down 10%. All five companies logged declining net income when looking at the first nine months of 2022, while Apple and Microsoft were the lone two to see growth in free-cash flow. Tech companies, like others across the S&P 500 SPX, “I want to acknowledge that we are still living through unprecedented times,” Apple Chief Executive Tim Cook told analysts on the company’s call on Thursday. “From war in Eastern Europe to the persistence of COVID-19, from climate disasters around the world to an increasingly difficult economic environment, a lot of people in a lot of places are struggling.” Yet Apple was the standout this quarter, not just because it was the only Big Tech company to register a post-earnings bump in its stock price, but also because it was the only member of the gang to actually grow net income. (Apple’s stock was in fact heading to its best single-day gain since September 2020 amid a 7% Friday rally.) The smartphone giant’s 0.8% increase in September-quarter net income was nothing to write home about compared with the 62.2% bump that Apple saw in the year-earlier quarter, but it was notable relative to the “carnage” of its Big Tech peers. Apple’s slight rise in net income came even as the company declined to raise prices on its iPhone 14 family despite supply-chain pressures and other challenges. When zooming out, Apple’s net income is down on the year, however, off 1.1% through the first nine months, according to Dow Jones Market Data. Chief Executive Tim Cook said on the company’s earnings call that the company has seen “inflation related to logistics” and with some silicon components. The internet sector, though, made Apple’s results shine even brighter, amid competitive and macroeconomic challenges that have been compounded, from a financial perspective, by the determination of Meta and Alphabet to push forward with aggressive spending plans. Meta was the only Big Tech company to post a revenue decline (-4.5%) in the latest quarter, while at the same time the company’s losses in its Reality Labs business ballooned to nearly $10 billion over the last nine months. Net income in the quarter dropped in half and its stock sunk to its lowest level in six years on Wednesday. The report marked an even grimmer chapter in a tough year for the company, which has now seen revenue rise only 0.2% through the first nine months of the year, as net income has plummeted more than 36% and as free-cash flow has nearly halved. Meta’s financial challenges could continue as Chief Executive Mark Zuckerberg vowed to plow more money into its metaverse ambitions with Reality Labs spending projected to “increase meaningfully again” next year. Like Meta, Alphabet is determined to spend, even though it’s shown some signs that it will depart from the ways of old. Executives told analysts on their conference call that they would slow hiring levels in the fourth quarter, to half of the hires brought in during the third quarter. At least one Wall Street analyst said the internet search and ad giant should instead be freezing its hiring, and our colleagues at Barron’s declared that Alphabet needs to go on a diet. Whereas investors once rewarded fast-growing tech companies for efforts to expand their businesses further, now Wall Street has sent a caution signal. At least two Big Tech companies are paying attention. Amazon Chief Financial Officer Brian Olsavsky told analysts the company was “taking action to tighten our belt,” and Microsoft executives made similar comments in the latest quarter. “While we continue to help our customers do more with less, we will do the same internally,” Microsoft Chief Financial Officer Amy Hood, said as she noted that Microsoft’s operating-expense growth should “moderate materially” as the fiscal year goes on. Adding more pressure to Big Tech was the fact that one of the golden sectors of tech — cloud computing — was also slowing down. The top two cloud service companies, Amazon’s AWS and Microsoft’s Azure, saw revenue growth deceleration in the September quarter, while Google Cloud saw revenue slow from the first and fourth quarter of 2021. It’s worth asking at this point what should comprise Big Tech. Meta is worth far less than chip powerhouse Nvidia Corp. NVDA, MarketWatch periodically tabulates the results of the biggest tech companies to show the scale and performance of these market titans, but perhaps it’s worth removing Meta from the Big Tech gang as its valuation plummets. With or without Meta, it’s clear that Big Tech’s fortunes have turned. The big high-double-digit growth days appear to be behind the group and investor expectations have now changed: Wall Street looks increasingly ready to reward companies for their ability to rein in expenses and generate free-cash flow. For now, heady growth is over.

AMZN

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Off To The RACES: FAANG Crushed

The historic capital that began as a quiet murmur in 2020 and 2021, and rose to full throated roar in 2022, has continued, this time with FAANG crushed.

SeekingAlpha

Off To The RACES: FAANG Crushed Summary - The historic capital that began as a quiet murmur in 2020 and 2021, and rose to full throated roar in 2022, has continued, this time with FAANG crushed. - Meanwhile, energy equities continue to outperform on both an absolute and relative basis. - Going forward, there's still a lot of room for energy equity revaluation higher, while the much ballyhooed FAANG stocks have further room for multiple compression. - Investors as a whole are still underweight in the energy sector, so there is further room for a majority of market participants to follow in Buffett's footsteps in embracing the energy sector. - The real driver of the secular bull market is the capital cycle, and this is underappreciated right now. - This idea was discussed in more depth with members of my private investing community, The Contrarian. Learn More » If everybody indexed, the only word you could use is chaos, catastrophe… the markets would fail. - John Bogle, May 2017 Try to buy assets at a discount rather than earnings. Earnings can change dramatically in a short time. Usually, assets change slowly. One has to know much more about a company if one buys earnings. - Walter Schloss Introduction Watching the after hours price action of Amazon (AMZN) shares last night, when the stock fell over 20% due to lowered guidance, my mind drifted to the ongoing historical capital rotation from growth to value, from loved to unloved, with the latest move in this ratio occurring from the most ballyhooed stocks getting pummeled. On that note, earlier this week, we saw Meta Platforms (META) fall 25% post their third quarter earnings, and both Alphabet (GOOGL), (GOOG), and Microsoft (MSFT) shares fell sharply too after their respective third quarter earnings results. As a contrarian, value-oriented investor, the sheer magnitude of the drop in Meta Platform shares, which are down a staggering 70.9% year-to-date in 2022 alone, certainly gets my research interest flowing. Looking back, this may be the start of a buying opportunity, specifically in META, which I will go into more detail later in a future, different article. Having said that, technology stocks are far from cheap on a relative basis as the following Bank of America (BAC) graphic illustrates, comparing technology stocks to the broader S&P 500 Index (SP500). Investors looking to buy the dip in technology stocks have to look at the chart above, and at least take a pause, at a minimum. Speaking from the experience of someone who has been too early buying a value trap previously, secular bear markets can be drawn out affairs, with Microsoft's price action from 2000-2009 being a prime example, where the largest market capitalization company went through an extended bear market despite generally robust growth. Conversely, energy equities remain remarkably cheap, with price to earnings ratios well below the broader market. Thus, remarkably, after almost three years of significant cumulative outperformance, the more prominent contrarian opportunity may still be in energy equities, and not in the newly discounted technology leaders, which still have further room to see their relative valuation multiples compress. Said another way, buy the dip, just not in the sectors that investors usually apply that approach. Energy Equities Have Outperformed Significantly In 2022 Energy equities have outperformed significantly year-to-date in 2022, with the Energy Select Sector SPDR Fund (XLE) up 65.4% year-to-date in 2022, which is a significant percentage gain from their 45.3% gain for XLE through April 15th, 2022, which was the last entry in this article series. The last update was actually published on April 15th, 2022, but the percentage gains were through the close of April 14th, 2022. The very strong absolute performance of XLE YTD compares very favorably to a 19.1% YTD decline in the SPDR S&P 500 ETF (SPY), which was down 7.5% as of April 14th, a 31.1% YTD decline in the Invesco QQQ Trust (QQQ), which was down 14.8% through April 14th, a 33.2% YTD decline in the iShares 20+Year Treasury ETF (TLT), which was down 18.2% through April 14th, and a 60.0% YTD decline in the ARK Innovation ETF (ARKK), which was down 37.6% through April 14th, 2022. Growth stocks, led by the momentum growth favorites that dominate ARKK, have been severely impaired, held back by their poor starting valuations, something I wrote about in detail on August 10th, 2021, with the article titled, "ARKK Implosion Is On The Horizon." Since that article was published, ARKK shares are down an eye opening 68.8%, which is a further loss from the 51.2% decline in the April 2022 update. For a comparative basis, the S&P 500 Index is down 14.2% (it was down 1% on April 14th, 2022 from the original article's publication for perspective), as illustrated in the image below. With the benefit of hindsight, obviously, growth stocks have really struggled in 2022, and really since ARKK peaked in February of 2021. This has occurred as rising interest rates across the yield curve, but particularly at the longer end of the yield curve, reduce the appeal of the longest duration assets. A Historical Capital Rotation Is In Progress, Exemplified By Exxon Mobil Versus Salesforce.com On the opposite side of the ledger, high free cash flow yielding companies are being rewarded, and many of these free cash flow standouts reside in the commodity equity sector, particularly in the energy sector. Taken together, meaning the downturn in technology stocks, and the surge in out-of-favor commodity equities, a historical capital rotation is underway. This historic capital rotation is something I have chronicled on a regular basis, documenting the flow of money from the "Haves" to the "Have Nots." These public articles below reference this historical capital rotation. - "A Historic Capital Rotation Is On Tap" - Published October 18th, 2020 - "A Historic Capital Rotation Is Happening Hidden In Plain Sight" - Published November 25th, 2020 - "The Historic Capital Rotation Is Continuing" - Published December 4th, 2020 - "Goldman Is Trumpeting A New Secular Commodities Bull Market And Investors Should Listen" - Published December 16th, 2020 - "Not All Energy Stocks Are Created Equal" - Published December 24th, 2020 - "A Historic Capital Rotation Is Quietly Marching On" - Published October 29th, 2021 - "A Historic Capital Rotations Is At A Fever Pitch" - Published February 4th, 2022 Pounding in this narrative of a historic capital rotation playing out in front of our eyes as investors hidden in plain sight, with this public article, I outlined how removing Exxon Mobil (XOM) from the Dow Jones Industrial Average (DIA) and replacing the venerable, longest listed Dow Jones component with Salesforce.com (CRM) in August of 2020 would turn out to be a high water marker for the current state of the financial markets. The share price performance of Exxon and Salesforce.com shares since that removal date says everything that you need to know about the financial markets since August 2020, with the SPDR S&P 500 ETF (SPY) performance, shown in black below, as the reference point. More specifically, XOM shares are up 196.4%, before today's anticipated gains after Exxon's strong third quarter 2022 earnings results, and CRM shares are down 41.1%. Going further, to show the steady progression of the historical capital rotation, here is the same chart from the April 15th article in this series. With the benefit of hindsight, almost all market participants were crowded on one side of the boat in 2020 and early 2021, overweighting technology shares, and underweighting the left behind value stocks, particularly the downtrodden commodity equities, and more specifically the energy equities. RACES Stocks Lead The Way The best example of this seismic shift in the investment landscape has been in the performance of natural gas equities, which I affectionately coined with the term RACES, which is the first letter of each of the equities highlighted in more detail below. More specifically, these equities are Range Resources (RRC), Antero Resources (AR), CNX Resources (CNX), EQT Corp. (EQT) and Southwestern Energy (SWN). The "C" in RACES by the way, could be Coterra Energy (CTRA), which was formerly Cabot Oil & Gas before their merger with Cimarex, Chesapeake Energy (CHK), or Comstock Resources (CRK), so chose your "C" as you see fit. Collectively, as you will see further down in this article, these natural gas equities which have trounced their vaunted FAANG peers in performance terms, across a range of time frames dating to January 1st, 2020, as I will illustrate below, which is an updated fifth edition to my February 3rd, 2021 article, "Off To The RACES: Natural Gas Equities Lapping FAANG Stocks, the May 26th, 2021 follow-up, the September 10th, 2021 third edition, and the April 15ht, 2022 fourth edition. Off To The RACES Stocks Are Significantly Outperforming The following performance chart shows the total return of Range Resources, Antero Resources, CNX Resources, EQT Corp., Southwestern Energy, and the SPDR S&P 500 ETF from January 1st, 2020 through Thursday, April 14th, 2022. Looking at the same performance chart below from the April 15th prior update in this series, with performance through April 14th, 2022, offers some clues. More specifically, Antero has appreciated slightly, while Range Resources, EQT Corp, Southwestern Energy, and CNX Resources have pulled back. Even with the recent pullback outside of Antero Resources, all of these natural gas equities have significantly outperformed the SPDR S&P 500 Index ETF, which has now gained 23.3% year-to-date, which is down from the 40.8% gain SPY posted since January 1st of 2020 in the prior update as the broader equity market has trended lower. Collectively, through October 27th, 2022, the "Off To The RACES" stocks have an average return of 429.8% since January 1st of 2020. This is down moderately from the 478.1% average return posted in the April 2022 update, and this simple average return is up significantly from the 190.4% average return from the September 2021 update, and the 152.6% average return since January 1st of 2020 published in the May 26th, 2021 article. Looking back to the first article in the series, the average return of 429.8% is up significantly from the average return of 80.4% from January 1st, 2020 through February 2nd, 2021. This might surprise many investors who have cast aside energy equities to the dustbin of history, yet these cast aside energy equities are significantly outperforming. FAANG Is Crushed What are the returns of the FAANG stocks over this time frame since January 1st, of 2020? By the way, I know Meta Platforms is no longer Facebook, however, when I started this series it was still Facebook, so we will stick with the FAANG acronym. The chart below illustrates this succinctly. Standing out like a sore thumb among its peers, or what I like to call the last shoe to drop, Apple (AAPL) shares are higher by 101.00 year-to-date. For perspective, looking at the chart in the last April 2022 update, even Apple shares are lower, down from their 128.8% gain shown below, however, the drops have been more severe elsewhere in this technology leading quintet. Taken all together, the new average return of the FAANG stocks since January 1st, 2020 is now a paltry 19.7% on average, even with the outlier of Apple shares, thus far. This 19.7% average return is less that the 23.3% return in the SPDR S&P 500 ETF over this timeframe. Additionally, this is a sharp decline from the April 2022 average return of 58.0%, which itself was a decline from 96.9% in the September 10th, 2021 update in this series. Bottom line, the "Off To The RACES" stocks have delivered an 429.8% average gain since the start of 2020 through October 27th, 2022, down moderately from the 478.1% average gain posted in the April 15th, 2022 update, yet significantly ahead of the FAANG average return of 19.7%. FAANG stocks have been crushed, with the 19.7% average return from January 1st, 2020 down significantly from the 58.0% average return that FAANG stocks delivered in the prior update through April 14th, 2022. That return was down from the 96.9% average gain from the September 10th, 2021 update for the FAANG equities. The return gap did not widen with this update, like it has in the past, however, it did not shrink much as FAANG declines offset some weakness in natural gas, and natural gas equities. A Long Time In Development and The Start Of A Longer-Term Opportunity Researching, chronicling, and tracking the opportunity in one of the most out-of-favor corners of the market has been a time-consuming initiative over the last couple of years, though it has proved worthwhile in terms of relative and absolute opportunity. The following partial list of public articles chronicles my thought process on the targeted natural gas equities, including Antero Midstream (AM), and the broader developing opportunity in commodity equities over the past year. - "Southwestern Energy: A Misunderstood Natural Gas Producer" - Published December 13th, 2019 - "Range Resources Continues Capex Cuts, Validates Appalachia Advantage" - Published January 8th, 2020 - "Antero Resources Is A Generational Buy: Dispelling The Myth Of Antero As High-Cost Producer" - Published February 19th, 2020 - "Antero Midstream Shares Are Significantly Undervalued Too" - Published February, 20th, 2020 - "The Long Oil, Short Natural Gas Trade Is Officially Dead" - Published March 9th, 2020 - "The United States Natural Gas Fund Was Up On A Historic Down Day For Energy" - Published March 10th, 2020 - "EQT Corp. Surges As The Bearish Natural Gas Thesis Is Dead" - Published March 17th, 2020 - "EQT Leading The Forthcoming Move Higher In Natural Gas Prices" - Published July 24th, 2020 - "Antero Resources Is A Generational Buy: Working Through The Near-Term Debt Maturities" - Published July 19th, 2020 - "Antero Midstream Has Outperformed All Other Midstream Firms Year-To-Date" - Published July 29th, 2020 - "Antero Resources Is A Generational Buy: Mapping Out The Free Cash Flow" - Published October 28th, 2020 - "Antero Resources Leading The Way In A Historic Energy Equity Rally" - Published December 11th, 2020 - "Not All Energy Stocks Are Created Equal" - Published December 24th, 2020 - "Antero Resources: Buy The Forgivable Dip" - Published August 2nd, 2021 - "EQT Corp.: Buy The Forgivable Dip At A 20% Free Cash Flow Yield" - Published August 4th, 2021 - "U.S. Steel: A Breakout Stock For 2022" - Published January 26th, 2022 - "Peabody Energy: A Breakout Stock For 2022" - Published January 28th, 2022 If you read through the articles above that chronicle this journey, there was pessimism and skepticism in the commentary sections, especially in the beginning. This skepticism and pessimism was evident publicly, and privately, where many struggled to embrace such a poor performing group of stocks. In my contrarian mindset, the continued pessimism and skepticism, which still exists today to an extent, think Cathie Wood of ARK Innovation ETF fame calling for a commodity crash in the second half of 2021, and subsequently doubling and tripling down on this call. This is a call I have vehemently disagreed with, and the boldness of investors that have gotten it completely wrong confirms that we're still in the early innings of this opportunity in natural gas equities, commodities, and commodity equities. On that note, if you look at the relative performance chart of a broad based index of commodities vs. the SPDR S&P 500 ETF, the size and scale of the relative opportunity quickly become apparent. For perspective here was the last chart posted in the April 15th, 2022 article. For reference, here was the same chart posted in the September 10th, 2021 update in this series. Closing Thoughts: More And More Investors Are Starting To Recognize The Potential Of A Secular Commodity Bull Market With Buffett piling into Chevron (CVX), and Occidental Petroleum (OXY), another stock that was a battleground stock where we were early on, many investors are starting to open their eyes to the developing potential in commodities, and commodity equities. For the moment, the energy sector remains a relatively paltry roughly 5% of the S&P 500 Index, however, as relative outperformance continues, the passive fund flow headwinds will become tailwinds. The untold story with the rise in energy equities is that this is a supply side story. Going further, the capital cycle is playing out in real time as energy equities collectively emphasize shareholder returns, specifically buybacks and dividends, diverting operating cash flows that used to almost entirely be reinvested back into operations. This, along with still low valuations, has interrupted the normal capital and created a backdrop for a secular bull market. With the broader equity market still exposed to the potential of a further drawdown, or perhaps seven years of running in place, because of historically poor starting valuations, there's a need for investors to consider alternative asset classes. Importantly, a further drawdown in the broader markets, which could be fueled by rising long-term interest rates rising because of supply side commodity inflationary pressures combined with building wage pressures, could accelerate fund flows into commodity equities. Why? Simply put, investors will be looking for non-correlated sectors and non-correlated stocks, especially if the drawdown in both stocks and bonds continues. Notably, this dual decline in stocks and bonds year-to-date in 2022 is impairing the traditionally popular 60/40 portfolio as well as the previous very in-favor risk parity strategies. On this note, commodity stocks, specifically the once loathed, and still generally unloved energy equity sector, certainly fits the bill as a portfolio diversifier, and enhancer, which we have seen play out in spades in 2022. Wrapping up, quietly at first, and now more rapidly as the capital rotation has broadened in scope, we have seen a passing of the baton of market leadership. Once the last safe-haven equities succumb to the broader bear market selling pressures, perhaps this passing of the baton will be clearer, however market phase changes like this take a long time, meaning years in the process. Will there be ebbs and flows to this process? Unequivocally yes, meaning expect relative pullbacks as investors reposition, and investors of all stripes try to re-orientate around the inflection point that is occurring real time. At this juncture, most investors are simply just becoming aware of the ongoing bear market and the leadership transition that has been taking place since the broader equity markets bottomed in March of 2020, though relative and absolute price action this year in 2022 has certainly opened more eyes. Recognizing this changing backdrop after years of study, including being too early, I have been pounding the table on the extremely out-of-favor commodity equities for several years now, and I still think we're in the early innings of what will be a longer-term secular bull market, albeit with significant volatility. Personally, I think we will supersede the capital rotation that took place from growth-to-value during 2000-2007, which also coincided with the last secular commodity bull market which ran from 2000-2008. Investors skittish of commodity equities should research cast aside financials as they also will benefit from a renewed steepening of the yield curve, which is probably forthcoming following the eventual Fed pause and pivot, whenever it occurs, which could even be a year out at this juncture. Understanding the bigger picture, then having an understanding of the bottoms-up fundamentals has been the key to outperformance, and this is a path that has not been easy with those participating confirming this reality. However, the road less taken is sometimes the better one, and I firmly believe that today, as traditional stocks, bonds, and real estate continue to offer very poor starting valuations, though they're better than at the start of this year where I opined it was better to be in cash for the next seven years, and very poor projected future real returns from today's price levels. More specifically, the out-of-favor assets and asset classes, including commodities and commodity equities and out-of-favor specific securities, are where the historic opportunity has been, and that's where it still stands, from my perspective. The Contrarian For further perspective on how the investment landscape is changing, and where to find the superior free cash flow yielding companies, consider joining our team of battle tested analysts at The Contrarian. Collectively, we have a unique history of finding under-priced, out-of-favor equities with significant appreciation potential relative to the broader market. Additionally, we have a robust investment discussion, alongside an equally robust discussion on portfolio strategy. Collectively, we make up The Contrarian, sign up here to join. This article was written by Twenty plus year career as an investment analyst, investor, portfolio manager, consultant, and writer. Founder of Koldus Contrarian Investments, Ltd, which was incorporated in the spring of 2009. Dyed in the wool contrarian investor, who has learned, the hard way, that a good contrarian is only contrarian 20% of the time, but being right at key inflection points is the key to meaningful wealth creation in the markets. I believe we are near a meaningful inflection point, perhaps the biggest one yet, for the third time in the past 15 years. Historically, I have had huge wins and impressive losses based on a concentrated, contrarian strategy. Trying to keep the good while filtering out the bad.Seeking to run an all weather portfolio with minimal volatility and index overlays to capture my strategic and tactical recommendations along with a concentrated best ideas portfolio, which is my bread and butter, but the volatility only makes it suitable for a small piece of an investor's overall portfolio. The following are a couple of my favorite investment quotes. "Life and investing are long ballgames." Julian Robertson "A diamond is a chunk of coal that is made good under pressure." Henry Kissinger "Knowledge is limited. Imagination encircles the world." Albert Einstein I’ve been on top of the world, and the world has been on top of me. I have learned to enjoy the perspective from each view, and use opportunities to persistently acquire knowledge, and enjoy the company of those around me, especially loved ones, family, and friends.At heart, I am a market historian with an unrivaled passion for the capital markets. I have had a long history and specialization with concentrated positions and options trading. Made money in 2008 with a net long portfolio, deploying capital in some of the market's darkest hours into long positions including purchases of American Express, Atlas Energy, Crosstex, First Industrial Real Estate, General Growth Properties, Genworth, Macquarie Infrastructure, Ruth Chris Steakhouse, and Vornado near their lows. Shorting, hedging, and option strategies also helped me in 2007 and 2009, and these are skills that I have developed ever since I started trading heavily in 1996.I enjoy reading, accumulating knowledge, and putting this knowledge to work in the active capital markets, learning lessons along the way.To this day, I continue to learn, and some of these learning lessons have been excruciatingly difficult ones, especially over the past several years, as I made mistakes allocating capital, including a sizable portion of my own capital (I always invest alongside my clients), to commodity related stocks. While all commodity related stocks have struggled since April of 2011, coal companies, which attracted me due to their extremely cheap valuations, and out-of-favor status (I am a strong believer in behavioral finance alongside fundamentals and technicals) have been the worst investing mistake of my career. The focus on the commodity arena has been the biggest mistake of my investment career thus far, yet in its aftermath, I see tremendous opportunity, even larger in scope than the fortuitous 2008/2009 environment.The capital that I accumulated and the confidence gained in navigating the treacherous investment waters of 2008 gave me the confidence to launch my own investment firm in the spring of 2009, right before the ultimate lows in the stock market. At the time I was working as a senior analyst at one of the largest RIA's in the country, and I felt strongly that the market environment was the best time since 1974/1975 to start an investment firm. Prior to starting my firm, I was a senior analyst for three different firms over approximately 10 years (Charles Schwab, Redwood, Oxford), moving up in responsibility and scope at each stop along my journey. Since I was a paperboy, I have always had an interest in the investment markets. I love researching and finding opportunities. I was a Chartered Financial Analyst, CFA from 2006-2018. Additionally, I have been a Chartered Alternative Investment Analyst, CAIA. After starting in the teaching program at Ball State University, I switched to a career in finance when I turned a small student loan into a substantial amount of capital. I graduated summa cum laude with a degree in finance from Ball State. Full disclosure, I am not currently a registered investment advisor, though I did serve in this capacity from 2009-2014, while owning Koldus Contrarian Investments, Ltd. Additionally, I held various securities licenses from 2000-2014 without a single formal complaint filed. At the end of 2014, I voluntarily let my state registration expire, as I transitioned the business to a different structure after going through a brutal business environment, divestiture and difficult divorce and custody battle. Prior to this, I had passed, and held, various securities exams and licenses, including the Series 7, Series 63, and Series 65 exams, in addition to others, alongside the CFA and CAIA designations. Unfortunately, I did not file the proper paperwork to withdraw my state registration, and I did not disclose a personal arrangement, and subsequent civil case, between myself and a former close personal friend and client. This arrangement was initiated informally in 2011, after a substantial period of success, as we aimed to be business partners, and it ultimately resulted in a dispute. I was unaware that I was required to disclose these items, and my securities attorney, at the time, did not advise me to do so. Previously, I had managed a portfolio for this gentleman, and we had taken an investment of approximately $7 million in 2009, and grown it to over $25 million at the beginning of 2012. After a very difficult year of performance, an employee of the firm I owned, and friend, resigned in early 2013, and took the aforementioned client to a competing firm. As a result of not filing the proper paperwork, I agreed to a settlement, with a potential $2500 fine in the future, depending on if I choose to reapply to be a non-exempt advisor. Additionally, while going through the difficult divorce and business dispute and divestiture, I did not file the proper disclosure on two of the annual CFA renewals. As a result, the CFA Institute sought a 3-Year Suspension of my right to use the CFA designation, which I appealed, since the primary investigator in the case sought a 1-year suspension of my right to use the CFA designation for a majority of the investigation. A Hearing Panel heard the case, and went against the recommendation of the CFA's Institute's Professional Conduct Department. Long story short, be careful who you trust, especially when substantial money is involved, and always disclose everything properly, which is hard to do when you are going through difficult situations, as this is the last thing you are probably thinking of at the time. In closing, I have had more experience in the markets, business, and life than most, yet I am grateful & thankful for every day. Additionally, I have learned through success and failures that you have to move forward, and if you can do this, your life will form a rich tapestry of stories. Analyst’s Disclosure: I/we have a beneficial long position in the shares of AM, AR, BAC, CHK, CNX, CRK, CTRA, CVX, EQT, OXY, RRC, SWN, XOM AND I AM SHORT AAPL, SPY, AND TLT either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Every investor's situation is different. Positions can change at any time without warning. Please do your own due diligence and consult with your financial advisor, if you have one, before making any investment decisions. The author is not acting in an investment adviser capacity. The author's opinions expressed herein address only select aspects of potential investment in securities of the companies mentioned and cannot be a substitute for comprehensive investment analysis. The author recommends that potential and existing investors conduct thorough investment research of their own, including detailed review of the companies' SEC filings. Any opinions or estimates constitute the author's best judgment as of the date of publication, and are subject to change without notice. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (89) now FANG crushing RACES, we haven't heard anything from you for long time. are you still holding RACES or time to move on while NG is trying to go under $2 when will wave 3 starting? My feeling is that after Nov 8 it will become clear Fed will slow down then stop rising rates as this was an attempt to manipulate oil prices before the midterm and then the inverse rotation from outperforming energy share to underperforming technology will start again? I have loaded up on fintech, such as STNE, AFRM, NU , SOFI, MELI and on Brazil stocks such as NTCO, BRFS, AZUL this summer from the proceeds of sale of energy shares ( I was 100% in energy shares from March 2020 to June 2022, then rotated to beaten down fintech), but still keeping some energy allocation at about 30%, FTI, PBR, VET and Gazprom (the latter transferred to Russian brokerage to avoid trading restrictions elsewhere). So far, I would have done better if I did not rotate, but it is too early to say, we will be able to tell by the end of next year. I plead the Fifth on that! I’d like to go heavier into energy; which 2 or 3 tickers are the biggest laggards that are ready to catch up, in your opinion?As always, thank you and enjoy the upcoming holidays with your family! Your article should be required reading for all SA authors. If they can't package information like you, they should write elsewhere. Some authors do, but not most. I’m told constantly that I’m a leading natural gas producer. I like PAGP. This the the general partner for Plains. PAGP does not report on a k1 as does the partnership. WMB Williams will also be around for a long time though at a more modest dividend %. KMI will also be good long term/ You have brilliantly chronicled this rotation (out of tech and into energy, out of growth and into value) and I think you are the best analyst and PM in the country for thoughtfully identifying it. I bought AR early because of your "generational opportunity" note and it has been a huge winner for our clients. Another great call of yours is the panning of Catherine Wood and ARKK. What I would like to know is where beyond nat gas and oil (energy) that you see deep value. I believe there is a great rotation in the capital goods cycle which should benefit the Green Infrastructure beneficiaries like green commodity manufacturers. eg BHP, RIO... ALB (for lithium) and also CCJ for Nuclear. I see energy demand for nuclear, hydrogen and LNG. What names do you like there? I like TELL for LNG, but they have had delays and difficulty putting it together. What cheap names do you like there?? Anyone who is not a subscriber, should subscribe to the Contrarian. Tyson Halsey, CFA I'm with you in TELL but it is now the longest of long shots. I have great expectations for LEU in nuclear and GTLS in the LNG arena, as well as FLNG for transport. OSSIF is interesting re: pipeline emissions detection. Not endorsements but cos to look into. --- Yeah, XOM is blaming inflation when in actuality they are price gouging on an oil price half that of its previous highs. I agree inflation is affecting some industries but then, nearly all of those other industries are dependent on fossil fuels to deliver their product. This comment displays a deep ignorance or misunderstanding of the O&G industry and its markets. Applied to corn, semi chips, or uranium, it would immediately be seen as specious but somehow it has traction in O&G. Keep up the good work. LONG AR and a whole lot more....

AMZN

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Amazon: After Q3, It's Over

Amazon’s Q3’22 earnings release was a disaster. The e-Commerce company submitted a very weak forecast for Q4’22. Read my earnings analysis of AMZN stock.

SeekingAlpha

Amazon: After Q3, It's Over Summary - Amazon’s Q3 2022 earnings release was a disaster. - The e-commerce company submitted a very weak forecast for Q4 2022. - Amazon’s valuation and risk profile remain unattractive. Amazon.com, Inc. (NASDAQ:AMZN) followed in the footsteps of other tech companies in recent days and submitted a very disappointing forecast for the fourth quarter. Amazon's shares declined 4% yesterday, following the release of earnings from companies like Meta Platforms (META) and Alphabet (GOOG, GOOGL), which weighed upon on the stock market. After Amazon submitted its Q4 earnings card after regular trading, the firm's share price dropped another 13%. When the stock opens for trading today, the stock is set to trade down immediately to new 1-year lows as investors reevaluate their growth assumptions. Given the poor outlook for Q4'22 and high losses in the e-Commerce business, the stock's risk profile remains skewed to the downside! Earnings beat, but not much more... Amazon reported revenues of $127.1B for the third quarter, missing expectations by $370M. However, Amazon's Q3 earnings beat expectations, with actual EPS of $0.28 outperforming estimates by $0.08. Amazon's earnings release was not totally bad. The e-Commerce company grew its revenues by 15% year-over-year to $127.1B in the third quarter, meeting its growth target of 13% to 17%. The revenue picture was a mixed one, however. Amazon's North American e-Commerce business saw a re-acceleration of revenue growth in the third quarter: revenues grew 20% year-over-year to $78.8B, while revenues in Q2'22 only grew 10% in this segment. The international e-Commerce business remained problematic for Amazon - in part because of a strong USD - where revenue growth fell 5% year-over-year to $27.7B. In Q2'22, Amazon's international revenues slipped 12% year-over-year. Amazon Web Services had another good quarter regarding topline growth, but Q3'22 was not as strong as expected. The cloud platform segment generated revenues of $20.5B, showing an increase of 27% year over year. I expected Cloud to do better and generate at least 30% year-over-year growth in Q3'22 after the company's segment topline advanced 33% year-over-year in the prior quarter. Amazon Web Services ("AWS") is not only the fastest-growing segment for Amazon, but the business is as important for the company as it is chiefly because it is the only one that generates profits. AWS generated a third quarter operating profit of $5.4B, while Amazon's e-Commerce operations lost a combined $2.9B in the third quarter. Scary slowdown in growth for Q4'22 expected In my work "Amazon: Judgment Day," I warned that a weak guidance for the fourth quarter would likely determine the direction of Amazon's stock price in the near future. I ended my article with the following sentence: There are multiple headwinds for Amazon including high inflation, decelerating growth in the dominant e-Commerce business and possibly a weaker outlook for Q4'22 which could weigh on the company's shares after earnings! Amazon guided for revenues between $140B to $148B for the fourth quarter, indicating a year-over-year growth rate of only 2-8%. For the third quarter, Amazon projected 13-17% topline growth, and my own estimate for fourth quarter revenue growth was 10-14%. Amazon's growth is clearly expected to slow down, which suggests that the third quarter was an outlier quarter. Amazon's topline grew only 7% in Q2'22, and the outlook for Q4'22 strongly implies that the growth story, at least for now, is over at Amazon. Amazon is not a buy Amazon's valuation and risk profile are not attractive now that analysts will respond to Amazon's weak guidance for the fourth quarter and lower their Q4 and full-year EPS estimates. Amazon's EPS estimates had already started to drop before the submission of the Q3 earnings sheet, and I believe EPS will see major downward revisions in the coming days. Amazon is expected to earn $2.28 per share next year (a figure that could see major downward revisions as well) and revenues of $ 574.67B which means shares have a P/S ratio of 1.9 X. I believe the valuation will see further pressure in the near term and the stock is likely going to be dead money for the foreseeable future. Risks with Amazon Amazon faces a couple of major risks, including a further deceleration of its topline growth in the near future, continual pressure on Amazon's consolidated operating margins due to a loss-making e-Commerce business, as well as a strong USD. Additionally, estimates are likely to get downgraded after Amazon submitted a disappointing forecast for Q4'22. I also see inflation as a major risk factor for Amazon going forward as it continues to weigh on consumer spending, which Amazon, as one of the world's largest e-Commerce companies, remains vulnerable to. Final thoughts It's over for Amazon. The e-Commerce company could see as little as 2% growth in Q4'22, which essentially ends the argument that Amazon is a growth stock. Growth rates in the double-digits are likely a thing of the past, and the e-Commerce company is set, I believe, to face growing top-line risks as its AWS business keeps decelerating and macroeconomic conditions deteriorate. The outlook for Q4'22 especially was a shock, and it indicates that investors may still overestimate Amazon's potential for growth. For those reasons, I believe that the risk profile as well as Amazon's valuation remain unattractive for investors! This article was written by Analyst’s Disclosure: I/we have a beneficial long position in the shares of GOOG, META either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (270) Also a lot of the reviews seem to be fake. I only read negative reviews and look for consistency or patterns. Amazon has its uses but I know people who have grown to despise it. FCF is monstrous Hundreds of billions in buybacks YouTube 7% Of Space X Android Fiber Search AdvertisingIts cheaper on a P/E and FCF per share basis than March 2020 rock bottom. Share price will be $150+ by start of 2024.Amazon? Maybe it trades sideways if you lucky.The opp cost of owning this over the last 3 years has been horrific. not interested in cashing in and paying cap gains tax...(on 1000 shares; 1/4 of my position cap gains of 182k) I believe long term growth will resume.

AMZN

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US STOCKS SNAPSHOT-Nasdaq opens lower as warnings from Amazon, Apple weigh

The Nasdaq opened lower on Friday as gloomy forecasts from megacaps Amazon and Apple outweighed data that showed U.S. consumer spending increased more than expected in September.

Reuters

Wall Street surges to sharply higher close ahead of Fed week - Summary - Companies - Apple rebounds, Amazon sinks after earnings reports - Data shows strong consumer spending, ebbing wage growth - Third-quarter aggregate earnings estimates raised - Dow notches best weekly percentage gain since May - Indexes jump: Dow 2.59%, S&P 2.46%, Nasdaq 2.87% NEW YORK, Oct 28 (Reuters) - A robust, broad-based rally sent Wall Street to a sharply higher close on Friday as encouraging economic data and a sunnier earnings outlook fueled investor risk appetite ahead of next week's much-anticipated two-day policy meeting of the Federal Reserve. All major U.S. indexes ended the session up about 2.5% or more, with the S&P and the Nasdaq notching their second straight weekly gains. The blue-chip Dow posted its fourth consecutive Friday-to-Friday advance and its biggest weekly percentage gain since May. "This has been one of the best months (so far) in the history of the Dow, suggesting the bear market likely ended," said Ryan Detrick, chief market strategist at Carson Group in Omaha. "Big monthly moves historically happen at the end of bear markets." "This is the second Friday in a row we’ve seen aggressive buying suggesting investors are growing more comfortable holding over the weekend," Detrick added. A 7.6% rebound in Apple Inc(AAPL.O) helped soften the blow of the 6.8% plunge for Amazon.com(AMZN.O) shares, in the wake of the two market leaders' results. Solid earnings beats from Chevron (CVX.N), Exxon Mobil (XOM.N) and other companies outside the tech and tech-adjacent megacap group have brightened aggregate earnings estimates for the quarter. Analysts now see third-quarter S&P 500 earnings growth of 4.1%, up from 2.5% on Thursday, according to Refinitiv data. "We’ve seen some high-profile misses from significant large-cap names," Detrick said. "But under the surface many of the smaller and midsize companies have been quite impressive with their earnings results." On the economics front, the Commerce and Labor Departments released data that showed robust consumer spending and easing wage growth, respectively. Financial markets have now priced in an 84.5% likelihood of a fifth consecutive 75 basis point interest rate hike at the conclusion of the Fed's Nov. 1-2 policy meeting, and a 51.4% chance the central bank will decelerate to 50 basis points in December, according to CME's FedWatch tool. "The door is cracked open on the possibility that we might see a more dovish Fed come December’s policy meeting, whereas a month ago that door was locked and slammed shut," Detrick added. The Dow Jones Industrial Average (.DJI) rose 828.52 points, or 2.59%, to 32,861.8, the S&P 500 (.SPX) gained 93.76 points, or 2.46%, to 3,901.06 and the Nasdaq Composite (.IXIC) added 309.78 points, or 2.87%, to 11,102.45. Of the 11 major sectors of the S&P 500, all but consumer discretionary stocks (.SPLRCD), weighed down by Amazon shares, ended the session green. Tech shares (.SPLRCT) enjoyed the largest percentage gain. Third-quarter reporting season has passed the halfway point, with 263 of the companies in the S&P 500 having reported. Of those, 73% have beaten consensus expectations, according to Refinitiv. Intel Corp (INTC.O) jumped 10.7% after cutting its spending forecast, while T-Mobile US Inc's (TMUS.O) subscriber forecast hike sent its shares up 7.4%. Twitter Inc was delisted from the New York Stock Exchange, closing the book on Tesla Inc (TSLA.O) chief Elon Musk's $44 billion purchase of the company. Advancing issues outnumbered declining ones on the NYSE by a 2.87-to-1 ratio; on Nasdaq, a 2.12-to-1 ratio favored advancers. The S&P 500 posted 32 new 52-week highs and eight new lows; the Nasdaq Composite recorded 117 new highs and 115 new lows. Volume on U.S. exchanges was 11.26 billion shares, compared with the 11.53 billion average over the last 20 trading days. Our Standards: The Thomson Reuters Trust Principles.

AMZN

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Ama-Gone: Why The Fed Is Still Not Bailing Your Poor Investments, Including Amazon

In May of 2022 we wrote why those expecting a Fed Put, would be put to the test as Amazon's fluff was unlikely to support a price even 50% lower. Read more here.

SeekingAlpha

Ama-Gone: Why The Fed Is Still Not Bailing Your Poor Investments, Including Amazon Summary - In May of 2022 we wrote why those expecting a Fed Put, would be "put" to the test. - Amazon's fluff was unlikely to support a price even 50% lower and we remained extremely bearish. - The stock cracked on the Q3-2022 results and we tell you why we are not done yet. - I do much more than just articles at Conservative Income Portfolio: Members get access to model portfolios, regular updates, a chat room, and more. Learn More » When we last gave our opinion on Amazon (NASDAQ:AMZN) it was poorly received by the cheerleaders. We did not like the valuation and felt the stock would drop at least 50% from the top. Last time when AMZN's super bubble burst, the Federal Reserve had eased aggressively. We don't see any prospects for that this time and certainly there is far less room to ease compared to what was done there. So if AMZN dropped 92%, then don't be surprised if we get at least a 50% drop this time. Source: Ama-Gone, Why The Fed Is Not Bailing Your Poor Investments, Including Amazon And we are almost there... We actually hit the down 50% mark in the post-market action after the results. So where do we go from here for this once vaunted high flyer? Q3-2022 Net sales were lower than expected and came in with an increase of 15%. AMZN made sure everyone knew that exchange rates were making them take a bath and without the strong dollar, their sales would be up 19%. The big hit was in international where their sales were down 5% year over year. The much-vaunted AWS segment had sales move up by 28%, and this was a bit lower than the cloud growth from Microsoft Corporation (MSFT) or Alphabet Inc. (GOOG) (GOOGL). Both those names reported 30% plus growth rates in constant currency. Of course, sales tell a small part of the story. Nobody has been worried about Amazon to sell you things. Making money on the other hand is a very different story. North America reported a $400 million operating loss, compared to almost $1 billion in profit in 2021. International had a $2.5 billion operating loss, worsening 171% year over year. If there is one thing consistent about AMZN, it is that it likely has no idea how to get the international segment to even come close to an operating profit. At least you don't get whiplash modeling those numbers. Cash burn was stunning across all levels. Free cash flow was an outflow of about $20 billion. AMZN's presentation actually led off with the slide below. The 871% drop is one that should send shivers down even the most optimistic spines. Free cash flow less principal repayments on finance leases was an outflow of $28.5 billion. Outlook Guidance was for $144 billion in sales (midpoint) in Q4, implying a sales growth rate of 5% year over year. With real GDP at 2.6% and inflation over 8%, AMZN is badly trailing nominal GDP in sales growth, and it is not even a close call. The growth story is done and AMZN's best case is to track nominal GDP sales growth. As inflation and real GDP slow down, we think these numbers will prove extremely optimistic. The bigger question is when will this company actually make money consistently. It is already reached a sales level that is tracking nominal GDP. At that point you are more of a "value company" and not a "growth idea". Analysts obviously see things with green colored glasses and expect the best of outcomes. But even those numbers make AMZN ridiculously expensive. 50X next year's earnings that are based on sales numbers that now look impossible, is a recipe for more downgrades. A business breakdown also reveals some big holes in giving this a buy rating. AWS sales are slowing and will likely hit a brick wall in 2 years. AWS margins were down from 30% in 2021 (left) to 26% in 2022 (right) We see cloud and web services become a commodity service within 2-3 years and expect margins to drop by 40% from these levels (sub 15% operating margin). If you buy that story, then you need to sell AMZN. Verdict Let's talk about that big increase. We are talking about that $5.55 billion in stock-based compensation, annualizing to $22 billion. That alone knocks out the entire AWS operating income. Retail has of course not found a way to be profitable but valuing only the AWS at some crazy sales multiple will work out as well as valuing NVIDIA (NVDA) based on some arguably fictional addressable market numbers. The Federal Reserve has shown a big reluctance to ignore the heavy inflation numbers. Yes, we might be at a peak inflation rate, but historical data shows that inflation takes about two years to trend below 6% once we peak above 8%. Good luck getting interest rate cuts to support these insane valuations. We rate the shares a Strong Sell with a 1-year rice target of $70.00 Please note that this is not financial advice. It may seem like it, sound like it, but surprisingly, it is not. Investors are expected to do their own due diligence and consult with a professional who knows their objectives and constraints. Are you looking for Real Yields which reduce portfolio volatility? Conservative Income Portfolio targets the best value stocks with the highest margins of safety. The volatility of these investments is further lowered using the best priced options. Our Covered Calls Portfolio is designed to reduce volatility while generating 7-9% yields. We focus on being the house and take the opposite side of the gambler. Risk levels are provided for each trade, accompanied by transparent tracking of performance. Explore our method & why options may be right for your retirement goals. This article was written by Conservative Income Portfolio is designed for investors who want reliable income with the lowest volatility. High Valuations have distorted the investing landscape and investors are poised for exceptionally low forward returns. Using cash secured puts and covered calls to harvest income off value income stocks is the best way forward. We "lock-in" high yields when volatility is high and capture multiple years of dividends in advance to reach the goal of producing 7-9% yields with the lowest volatility. Preferred Stock Trader is Comanager of Conservative Income Portfolio and shares research and resources with author. He manages our fixed income side looking for opportunistic investments with 12% plus potential returns. Analyst’s Disclosure: I/we have a beneficial short position in the shares of QQQ either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (38) Amazon.Bomb (May 31, 1999) ritholtz.com/... Maybe cloud services are likewise vapourware, not financially investment wise. I'll drop out now and go back to energy suppliers. www.bloomberg.com/...

AMZN

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US STOCKS-S&P 500, Nasdaq set to open lower after Amazon, Apple warnings

The S&P 500 and the Nasdaq were set to open lower on Friday as gloomy forecasts from megacaps Amazon and Apple outweighed data that showed U.S. consumer spending increased more than expected in September.

Reuters

Wall Street surges to sharply higher close ahead of Fed week - Summary - Companies - Apple rebounds, Amazon sinks after earnings reports - Data shows strong consumer spending, ebbing wage growth - Third-quarter aggregate earnings estimates raised - Dow notches best weekly percentage gain since May - Indexes jump: Dow 2.59%, S&P 2.46%, Nasdaq 2.87% NEW YORK, Oct 28 (Reuters) - A robust, broad-based rally sent Wall Street to a sharply higher close on Friday as encouraging economic data and a sunnier earnings outlook fueled investor risk appetite ahead of next week's much-anticipated two-day policy meeting of the Federal Reserve. All major U.S. indexes ended the session up about 2.5% or more, with the S&P and the Nasdaq notching their second straight weekly gains. The blue-chip Dow posted its fourth consecutive Friday-to-Friday advance and its biggest weekly percentage gain since May. "This has been one of the best months (so far) in the history of the Dow, suggesting the bear market likely ended," said Ryan Detrick, chief market strategist at Carson Group in Omaha. "Big monthly moves historically happen at the end of bear markets." "This is the second Friday in a row we’ve seen aggressive buying suggesting investors are growing more comfortable holding over the weekend," Detrick added. A 7.6% rebound in Apple Inc(AAPL.O) helped soften the blow of the 6.8% plunge for Amazon.com(AMZN.O) shares, in the wake of the two market leaders' results. Solid earnings beats from Chevron (CVX.N), Exxon Mobil (XOM.N) and other companies outside the tech and tech-adjacent megacap group have brightened aggregate earnings estimates for the quarter. Analysts now see third-quarter S&P 500 earnings growth of 4.1%, up from 2.5% on Thursday, according to Refinitiv data. "We’ve seen some high-profile misses from significant large-cap names," Detrick said. "But under the surface many of the smaller and midsize companies have been quite impressive with their earnings results." On the economics front, the Commerce and Labor Departments released data that showed robust consumer spending and easing wage growth, respectively. Financial markets have now priced in an 84.5% likelihood of a fifth consecutive 75 basis point interest rate hike at the conclusion of the Fed's Nov. 1-2 policy meeting, and a 51.4% chance the central bank will decelerate to 50 basis points in December, according to CME's FedWatch tool. "The door is cracked open on the possibility that we might see a more dovish Fed come December’s policy meeting, whereas a month ago that door was locked and slammed shut," Detrick added. The Dow Jones Industrial Average (.DJI) rose 828.52 points, or 2.59%, to 32,861.8, the S&P 500 (.SPX) gained 93.76 points, or 2.46%, to 3,901.06 and the Nasdaq Composite (.IXIC) added 309.78 points, or 2.87%, to 11,102.45. Of the 11 major sectors of the S&P 500, all but consumer discretionary stocks (.SPLRCD), weighed down by Amazon shares, ended the session green. Tech shares (.SPLRCT) enjoyed the largest percentage gain. Third-quarter reporting season has passed the halfway point, with 263 of the companies in the S&P 500 having reported. Of those, 73% have beaten consensus expectations, according to Refinitiv. Intel Corp (INTC.O) jumped 10.7% after cutting its spending forecast, while T-Mobile US Inc's (TMUS.O) subscriber forecast hike sent its shares up 7.4%. Twitter Inc was delisted from the New York Stock Exchange, closing the book on Tesla Inc (TSLA.O) chief Elon Musk's $44 billion purchase of the company. Advancing issues outnumbered declining ones on the NYSE by a 2.87-to-1 ratio; on Nasdaq, a 2.12-to-1 ratio favored advancers. The S&P 500 posted 32 new 52-week highs and eight new lows; the Nasdaq Composite recorded 117 new highs and 115 new lows. Volume on U.S. exchanges was 11.26 billion shares, compared with the 11.53 billion average over the last 20 trading days. Our Standards: The Thomson Reuters Trust Principles.

AMZN

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Google Is Undervalued, But Might Decline Further

Alphabet/Google reported mediocre third quarter results with operating income and earnings per share declining year-over-year. See why I recommend a buy for GOOG.

SeekingAlpha

Google Is Undervalued, But Might Decline Further Summary - Alphabet/Google reported mediocre third quarter results, with operating income and earnings per share declining year-over-year. - The company is facing several risks - YouTube struggling, regulatory pressures and the looming recessions - but is protected by a wide economic moat. - When assuming moderate growth potential and Alphabet continuing share buybacks, the stock is probably undervalued. - However, I see further downside risk for the stock in the coming quarters. In my last article, I called Alphabet Inc. (NASDAQ:GOOG, NASDAQ:GOOGL) ("Google") a buying opportunity, but was pointing out it might get even cheaper. At the beginning of May, when the article was published, the stock was trading for $117. Now, pre-market on Wednesday, as I am starting to write this article, the stock is trading for $98 and, therefore, almost 20% lower. And this is begging the question whether Alphabet is now cheap enough and can be bought, as the stock seems to trade for a reasonable valuation multiple. Quarterly Results On Tuesday, Alphabet reported its third quarter results, and when looking at the price action in the first few hours after the results and earnings call, investors seemed to be disappointed. This is not surprising, as Alphabet missed expectations for revenue as well as earnings per share. And while revenue estimates were missed by $1.56 billion, earnings per share were $0.20 lower than expected. Alphabet generated $69,092 million in revenue in Q3/22 and, compared to $65,118 million in Q3/21, this is an increase of 6.1% year-over-year. While revenue could still increase, income from operations declined 18.5% year-over-year, from $21,031 million in the same quarter last year to $17,135 million this quarter. And diluted earnings per share also declined from $1.40 in Q3/21 to $1.06 in Q3/22 – a decline of 25.7%. When discussing these results, we should not forget that a strong U.S. dollar had a negative effect on the business, and on a constant currency basis revenue growth was 11%. And we are still comparing to exceptional good quarters in fiscal 2021 (in the same quarter last year, revenue growth was 39%), which is making a reverse to the mean likely. On the other hand, operating margin declined from 32.3% in Q3/21 to only 24.8% in Q3/22, which is not a good sign. Alphabet also increased the number of employees from 150k one year ago to 187k right now, which should usually be seen as a positive sign for a growing and expanding business. The biggest part of revenue still stems from Google Services, which generated $61,337 million in revenue (compared to $59,884 million in the same quarter last year). Google Cloud, on the other hand, is responsible for only 10% of total revenue ($6,868 million) but compared to the same quarter last year ($4,990 million in revenue) it could report 37.6% year-over-year growth. Other bets generated $209 million in revenue and hedging gains were $638 million. And although Google Cloud could improve its operating margin, it is still not profitable and operating income is solely stemming from Google Services. YouTube While growth was clearly slowing down for Alphabet in many of its business segments (and sub-segments), YouTube appears to be a problem-child for Alphabet right now. Google Search is almost unrivaled with a market share above 90%, while Android is also its market leader with a market share of 42%. However, YouTube, on the other hand, has several serious competitors. And in the third quarter of fiscal 2022, revenue from YouTube ads declined from $7,205 million in the same quarter last year to $7,071 million this quarter (1.9% decline). Revenue from “Google other” – which is including YouTube subscriptions – increased slightly from $6,754 million to $6,895 million. However, Alphabet is clearly trying to fight this trend and is prioritizing the monetization of Shorts. In September, Alphabet has started ads on Shorts, and the monetization and revenue sharing on Shorts will be introduced early next year (making YouTube the only platform where creators can also monetize short formats). Right now, Shorts has 1.5 billion users every month and about 30 billion daily views. Recession Another problem for Alphabet will probably be the looming recession. In the case of Alphabet (or Google), we only have the data from one real recession – the Great Financial Crisis. The COVID-19 recession can’t be seen as a real recession for Alphabet, as the businesses profited immensely from lockdowns – like most other technology companies. And to conclude Alphabet will perform in a similar way in the next recession as in 2020 would be a huge and dangerous mistake. And we are already seeing first signs in the results of Alphabet – and also other companies like Meta Platforms (META) and Amazon.com (AMZN). Spendings for advertisement usually declines during a recession, as companies will cut costs and, aside from firing people, cutting costs on advertisement is a typical step. And although people might actually use YouTube even more during a recession (when people get laid off and spend more time at home), Alphabet is depending on companies that are willing to spend more money on advertisement. Regulatory Pressure A third aspect is the ongoing regulatory pressures. Apparently, the European Union is preparing charges against Google once again, and it will issue the charges early next year. According to a Reuters article, the company could face its fourth fine in the EU of more than €1 billion. In September, it was also reported that Google will face damages claims up to €25 billion over its digital advertising practices in two suits to be filed in British and Dutch courts. It is filed by a law firm on behalf of publishers against the AdTech practices of Google. The company was also ordered to pay $162 million in fines by the Indian antitrust agency. But Alphabet had $21,984 million in cash and cash equivalents as well as $94,275 million in marketable securities and, therefore, fines – even several billion dollars – are not really a problem for Alphabet and almost have no impact on the intrinsic value of the stock. Growing Business All these challenges – YouTube, the looming recession and the regulatory pressures – seem to be rather short-to-mid-term challenges and manageable for Alphabet. And when looking at the bigger picture, we actually see a company with a wide economic moat and high growth potential. Especially the cloud market is promising high growth rates in the years to come. Since 2019, Alphabet could grow revenue for “Google Cloud” with a CAGR of 44% and has outperformed the public cloud services spendings in the last few years. And Alphabet is expecting these high growth rates to continue in the years to come, as the cloud market is probably still in the early stages. Between 2022 and 2026, the public cloud services spendings are expected to double once again, and Alphabet might be one of the companies profiting from this trend. And there are several different studies (see here and here) and forecasts that also expect high growth rates for the cloud business in the years to come. And aside from the cloud business, which has great growth potential, the advertising market will also grow with a solid pace in the years to come. Overall, we can be confident that Alphabet will be able to grow its top line with a solid pace – especially as the wide economic moat will keep competitors at bay. Intrinsic Value Calculation And not only does Alphabet have a wide economic moat around its business and growth potential in the years (and probably decades) to come – it also seems to be trading below its intrinsic value. As basis for our calculation, we can take the free cash flow of the last four quarters (which was $62,542 million). To be fairly valued, Alphabet must grow its free cash flow about 5% from now till perpetuity, which seems like a realistic and achievable target for Alphabet. However, we must assume a declining free cash flow in fiscal 2023 as revenue from advertisement will decline in case of a recession (and after the yield curve inverted recently, the probability for a recession is rather high). Let’s be cautious and assume a 20% decline in 2023. However, I am also optimistic for Alphabet having a strong recovery after a recession – assuming 20% growth in fiscal 2024, 15% in 2025 and 10% in 2026. And for the following years, we assume growth is slowing down to 6% in 10 years from now (and staying at that level till perpetuity). When calculating with these assumptions (and 10% discount rate), we get an intrinsic value of $121.59 for Alphabet. But, of course, you can argue these assumptions are extremely cautious. First, Alphabet will be able to grow its top line at least in the mid-single digits (probably even higher). Not only has Alphabet reported 20% growth on average in the past – without any signs of growth slowing down (until recently). Especially the cloud business could contribute to growth for several years to come. Second, Alphabet might also be able to increase its bottom line by using share buybacks. Over the last few years, Alphabet spent more and more money on share buybacks, and during the last quarter (Q3/22), Alphabet spent $15,392 million on share buybacks. When assuming Alphabet is using similar amounts on share buybacks and spending about $61 billion annually, the company can buy back almost 5% of its outstanding shares every year. This will certainly contribute to bottom line growth, and with an annual free cash flow of $65 billion right now (and more than $100 billion in extremely liquid assets on the balance sheet), share buybacks should be possible in a similar way as in the past. When combining top line growth and share buybacks, growth rates of 10% annually seem realistic for the years to come (excluding 2023). And when calculating with these assumptions and 6% till perpetuity, we get an intrinsic value of $130 to $135 for Alphabet. Still Downside Risk And although Alphabet is probably already trading below its intrinsic value, we should be extremely cautious. First, we should not forget that current valuation multiples are not the norm but are one of the most extreme outliers in the last 150 years. We must be prepared for valuation multiples returning to the mean again, and such a scenario will hit almost every business – including high growth companies like Alphabet. And I know the comparison is not completely accurate, but we should keep in mind that other companies with a similar business model declined extremely steeply – Meta Platforms (META) or Baidu, Inc. (BIDU), as well as Tencent Holdings (OTCPK:TCEHY), might be examples. And although the businesses are different, there are also similarities – Alphabet as well as Meta Platforms depend heavily on advertisement for generating revenue. In my opinion, the risk of Alphabet’s stock price declining further as the economy will be tumbling into a recession in the next few quarters is rather high. Conclusion While I see Meta Platforms as a clear buy (it is extremely cheap and the downside potential is limited), I am not so sure about Alphabet. The business is certainly not overvalued, but the stock could decline lower, and earnings could fall in the coming quarters. And a valuation multiple around 20 (while sounding reasonable) could suddenly be considered too high by investors, and the stock would decline further. And although it sounds unrealistic right now, we should not rule out a P/E ratio or P/FCF ratio of 15 or 10 for Alphabet. This article was written by Analyst’s Disclosure: I/we have a beneficial long position in the shares of META, BIDU, TCEHY either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (4)

AMZN

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Amazon slumps as tech selloff worsens

Amazon.com Inc's shares tumbled about 13% in premarket trading, with the online retailer coming close to losing its spot in the trillion-dollar company club, after forecasting holiday-quarter sales below Wall Street estimates.

Reuters

Amazon shares slump, Big Tech peers stay afloat Oct 28 (Reuters) - Amazon.com Inc's (AMZN.O) shares fell about 8% on Friday after forecasting holiday-quarter sales below Wall Street estimates, while its Big Tech peers recovered from a bruising selloff this week. The online retailer, whose market cap briefly fell below $1 trillion, was last down 8.4% at $101.66, after hitting its lowest since April 2020. Apple Inc (AAPL.O), however, shone bright amid a crowd of dimming lights in the Big Tech space, as the iPhone maker reported revenue and profit that topped analysts' estimates. Microsoft, Alphabet and Meta gained between 1.2% and 3.1% after their shares were battered this week following gloomy outlook from the companies. The Big Tech stocks are on track to lose more than $400 billion this week. Many view the megacap companies as bellwethers for how corporate America is faring during a year in which inflation has soared, pushing the U.S. Federal Reserve to enact a series of jumbo-sized rate hikes that have bruised markets. Analysts fear macroeconomic factors, including a strong dollar, will continue to hit Amazon in the near term, however, over a longer period of time, the retailer should be able to bounce back. "Despite accelerating revenues, Amazon has been cut down to size by the market after missing expectations. Efficiency has yet to return to the e-commerce business," Ben Barringer, equity research analyst at Quilter Cheviot, said. While the cloud services segment has been one of high and sustained growth for tech companies, indications for Amazon, Microsoft and Intel Corp (INTC.O) this week point to lower investments as costs rise. Intel's shares rose about 7% after the chipmaker said its cost-reduction plan includes layoffs and is expected to lower costs by $3 billion next year. However, analysts are cautious of how the company plans to cut costs. Cost reductions are necessary, but Intel needs to focus on cutting spending in the right places and keep research and development investments high, Glenn O'Donnell, research director at Forrester, said. Our Standards: The Thomson Reuters Trust Principles.

AMZN

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Apple: Teaching A Lesson On 'Fearmongering'

Apple beat analyst consensus with regards to both revenue as well as earnings during fiscal Q4. Read why I'm confident to reiterate my buy rating for AAPL stock.

SeekingAlpha

Apple: Teaching A Lesson On 'Fearmongering' Summary - Apple beat analyst consensus for fiscal Q4 with regards to both revenue as well as earnings. - Despite excessive "fearmongering" surrounding iPhone 14 demand, Tim Cook said that Apple's supply remains "constrained" versus demand. - Apple proved once again that doubting the world's most valuable consumer company is a fool's errand. - Following another strong quarter from Apple, I am confident to reiterate my "Buy" rating for AAPL stock. - As a function of higher risk premia for Big Tech in general, and smaller EPS adjustments for Apple specifically, I lower my base case target price to $200.59. Thesis I previously argued that it is unlikely that Apple Inc.'s (NASDAQ:AAPL) fiscal Q4 results would disappoint. And indeed they didn't. Despite excessive "fearmongering" surrounding the iPhone 14 demand - see here, here, and here - Tim Cook said that "We continue to be constrained today and so we're working very hard to fulfil the demand." That said, Apple beat analyst consensus with regards to both revenue as well as earnings; and the company once again proved that doubting the world's most valuable consumer company is a fool's errand. Reflecting on another strong quarter from Apple, while Google (GOOG, GOOGL), Meta Platforms (META), and Amazon (AMZN) stumbled, I reiterate my "Buy" rating for AAPL stock. But, as a function of higher risk premia for Big Tech in general, and smaller EPS adjustments for Apple specifically, I lower my base case target price to $200.59. Apple's September Quarter From July to the end of September, Apple generated record revenues of $90.14 billion, which represents an increase of 8% versus the same period one year earlier. For reference, analyst consensus had estimated Q4 sales at about $88.8 billion ($1.37 billion beat). The strong topline number was driven by better-than-expected iPhone sales, which increased 10% year over year to $42.6 billion (accounting for about 47% of sales), as well as an exceptionally strong (record) demand for Macs. Interestingly, strong Mac demand was sustained while Gartner estimated PC sales to have fallen by 19.5% in the September quarter. Services also recorded record revenues: the segment increased to $19.2 billion and claimed more than 900 million paid subscriptions. Tim Cook, Apple's CEO commented (emphasis added): This quarter's results reflect Apple's commitment to our customers, to the pursuit of innovation, and to leaving the world better than we found it ... ... As we head into the holiday season with our most powerful lineup ever, we are leading with our values in every action we take and every decision we make. We are deeply committed to protecting the environment, to securing user privacy, to strengthening accessibility, and to creating products and services that can unlock humanity's full creative potential. But Luca Maestri, Apple's CFO, also admitted in the analyst call that (emphasis added): we believe total company year-over-year revenue performance will decelerate during the December quarter as compared to the September quarter Profitability Expands Apple's profitability remained surprisingly strong. During the September quarter, the company generated operating income of $24.89 billion, as compared to $23.79 billion for the same period one year earlier. Net income edged higher to $20.72 billion (versus $20.55 billion in Q4 2021). Notably, Apple was the only "Big Tech" player that managed to increase EPS in the September quarter. The company generated EPS of $1.29, up 4 percent year over year - while Amazon's net income fell 9 percent, Microsoft's dipped 14 percent, Alphabet's declined 27 percent, and Meta's slumped 52 percent. This alone should clearly underline Apple's business quality. Shareholder Returns During the September quarter, Apple returned more than $29 billion to shareholders - in the form of dividends and share repurchases. If such a number would be assumed for the next four quarters, which is not unlikely given Apple's strong cash flow and balance sheet, Apple's yield would approach 5% - higher than what 10-year treasury yields offer, while also offering exposure to growth opportunity. With Q4 2022, Apple has also declared a cash dividend of $0.23 per share, which will be paid on November 10. Valuation Update I have previously valued Apple at $247.51/share, and I still believe that, long term, such a valuation would make sense. I continue to see the following (potential) value drivers: 1. New market opportunities including VR/AR and the Apple Car; 2. Accelerating strength in Apple's service portfolio; and 3. Continued financial engineering. However, I also need to acknowledge that valuations for Big Tech are falling and other companies - notably Meta and Google - provide deep value opportunities, in my opinion. That said, I understand that a 7.5% cost of equity does probably not reflect an adequate return requirement, and I upgrade this number to 8.25%. Moreover, I slightly adjust my EPS estimates to reflect analyst consensus adjustments. I continue, however, to anchor on a 4.5% terminal growth rate. Given the EPS upgrades as highlighted below, I now calculate a fair implied share price of $200.59. Below is also the updated sensitivity table. Conclusion Following the Bloomberg report that Apple is apparently scaling down production of the iPhone 14 product line, investors were wary that Apple's Q4 results would disappoint. But while other Big Tech companies crashed after reporting their September quarter, Apple was up slightly following the Q4 numbers (+0.5% after-hours trading reference). However, it is also impossible to ignore that Apple stock remains closely correlated to the S&P 500 (SPY). Accordingly, if an investor expects more pain for the S&P 500, then it will be hard to argue that Apple will not suffer in lockstep. Reflecting on another strong quarter from Apple, I am confident to reiterate my "Buy" rating for APPL stock. However, as a function of higher risk premia for Big Tech in general, and smaller EPS adjustments for Apple specifically, I lower my base case target price to $200.59 (versus $271.51/share prior). This article was written by Analyst’s Disclosure: I/we have a beneficial long position in the shares of AAPL either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Not financial advice. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (65) Or when the fed is coming near an end to interest rate hikes... -- "This is nothing more than a relief rally since earnings didn't implode like other big tech names. The trend is still down." -- **The trend is still down. Nice one! 😎 My father always drove a recent model Cadillac after he retired and before he passed. He loved them and I enjoyed riding with him when I visited. After he passed the family discovered he owed more on his Cadillac lease, due to flipping every two years, than his house was worth. Personally, I was simply happy that he was happy and in the end the lease co. got their car back. I get that Apple products may be superior and have the bells and whistles. Being of more modest means myself, I’ve been happy with the utilities I need from less expensive gadgets. Yes, I’m an old fart who considers their products as gadgets. As long as people can afford them, Apple will command that “luxury” gadget niche market. If Apple can stay in the good graces of China, they’ll probably do well. My concern as an investor is that to stay in those good graces, they must kiss the feet of the leader of a Communist regime and spit shine the shoes of a US President, when he starts tossing around tariffs. Not what I consider a promising business model.

AMZN

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Buying The Dip In Amazon Could Be A Mistake In The Near Term

Amazon.com, Inc. and its AWS growth will likely continue to slow in the near term. Click here to read why we think the AMZN stock is a sell.

SeekingAlpha

Buying The Dip In Amazon Could Be A Mistake In The Near Term Summary - Amazon.com's growth is slowing and is expected to continue to be weak in the near term. - AWS growth is also slowing due to the market conditions and competition. - Given that Amazon's earnings report has created a clear negative trajectory in the near term, it may be best for investors to sell now and buy later. Introduction Amazon.com, Inc. (NASDAQ:AMZN) has two major businesses that are responsible for the majority of the conglomerate's revenue: Amazon.com and AWS. Amazon.com is responsible for the famous e-commerce platform, both within the U.S. and international regions, while AWS - Amazon Web Services - is responsible for Amazon's cloud business. Unfortunately, I believe both of Amazon's major businesses will continue to underperform in the coming months. As many investors have already pointed out, Amazon.com is expected to continue its weakness as economic growth continues slowing as inflation and rates increase. Further, I believe that Amazon's cash cow, AWS, will also underperform compared to expectations due to intense competition from Google (GOOG, GOOGL). Therefore, given that both Amazon.com and AWS are expected to underperform relative to expectations, I believe Amazon has more room to fall. Amazon.com Because Amazon.com is the biggest e-commerce platform in the United States and has a formidable presence overseas, the business is heavily reliant on macroeconomic conditions and consumers' financial health. Today, the macroeconomic health and consumers' confidence is not in an ideal state. As the image above shows, U.S. consumer confidence levels are near the 2008 recession-time lows due to persistently high inflation. Further, this trend may continue, as the latest CPI data shows that inflation continues to be high at 8.2% despite aggressive actions from the Federal Reserve. Thus, the consumer's willingness to shop on Amazon.com is naturally decreasing, hurting the company's top and bottom lines. As a result of the macroeconomic hurdles, both Amazon.com's North American and International businesses have reported operating losses. North American business reported a $412 million operating loss, compared to an $880 million operating profit in the prior-year quarter. Further, Amazon.com's international business reported an operating loss of $2.466 billion for the quarter compared to $911 million in the previous year's quarter. Therefore, the sudden change in consumer confidence has created a strong negative trajectory for Amazon.com, and because the inflation continues to be persistent with the Federal Reserve signaling another 75 basis point increase in interest rate, this trend is expected to continue for the coming months, negatively impacting Amazon. AWS Although AWS continues to be the biggest and most competitive player in the market, AWS is expected to see growth and margin pressure in the near term due to both competition and market conditions. In Amazon's 2022Q3 earnings report, the company reported an AWS revenue of about $20.538 billion, which is about a 27.5% increase year-over-year from $16.110 billion in the previous year. The yearly number may give a positive connotation, as it includes quarters when the overall market was healthy and growing. However, looking at quarter-over-quarter growth, AWS's growth rate decreased from an average of 8.7% quarter-over-quarter in 2021 to an average of 4.94% quarter-over-quarter growth in 2022, which is about a 56.7% decline. Further, in 2022Q3, AWS's quarter-over-quarter growth was 4%, continuing its slowing growth trajectory. AWS is Amazon's most important business, as it is the only business that is returning positive operating income as of today. However, AWS's growth is showing a significant slowdown along with the negative market sentiment. Further, AWS may be seeing a slowdown due to competitive pressure from Google Cloud. Google Cloud has been perceived by the market as an inferior product to AWS; however, since 2019, Google has shifted its focus to enterprise cloud with the appointment of its new cloud president Thomas Kurian. As a result, Google Cloud's growth has been stronger than Amazon's at 9.43% sequential growth in 2022Q3, and about 163% growth since 2019Q4 compared to AWS's 106%. Google's enterprise-first approach is allowing the AWS customers to diversify its cloud portfolio, barring AWS's full growth potential. While it is true that AWS is competitive and the cloud market is expected to continue its growth at 15.7% CAGR until 2030, the current market environment where the Fed is aggressively raising rates is affecting the cloud market despite its long-term underlying trend, and Google is coming out on top during this times. Therefore, given these data points, I think it is logical to argue that AWS will not save Amazon from a significant slowdown in Amazon.com. Valuation AWS's growth rate will likely stay relatively low in the near term as cloud growth is not robust due to the macroeconomic conditions and confidence. Further, Amzon.com is expected to continue struggling with low consumer demand and the Fed's determination to aggressively raise rates no matter the cost to keep inflation low. Thus, Amazon has the potential to see a valuation dip due to multiple contractions. The company is currently trading at about 43.4 times 2023 price-to-earnings, which is relatively low considering Amazon's historical price-to-earnings. However, considering the near-term hurdles and Amazon's expected 2023 growth rate of 14.6%, which is similar to other tech giants such as Microsoft (MSFT) at 13.3%, I do not see a compelling reason why Amazon is receiving about 43.4 2023 price-to-earnings while Microsoft is receiving about 24.24 2023 price-to-earnings. Therefore, given Amazon's slowdown, I believe it is likely for Amazon's valuation multiples to shrink. Risk to Thesis My bearish thesis concerning the slowdown in both Amazon.com and AWS is contingent upon the worsening macroeconomic condition as a result of the Federal Reserve raising rates aggressively. However, in the upcoming FOMC meeting on November 3rd, if Fed President Jerome Powell hints at the start of the end of the aggressive tightening cycle, investors will likely see it as a sign that the economic downturn has peaked, increasing Amazon's valuation multiples once again. Further, the Fed's hinting of a slowdown of raising rates in the next few months may result in the economic downturns being moderate, bringing Amazon.com and especially AWS back to its growth trajectory. Summary Being too early in the stock market is the same thing as being wrong. I believe investors should stay away from Amazon given the negative trajectory Amazon has shown during its 2022Q3 earnings report. Amazon.com is expected to continue reporting losses as demand significantly slows due to declining consumer confidence, with an unlikely increase in potential in the near term. Further, because AWS, Amazon's cash cow, is also experiencing slower growth and margin concerns due to the macroeconomic conditions, I believe it is best if investors stay away from Amazon until the storm passes. Therefore, Amazon is a sell. This article was written by Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (32) www.theguardian.com/... The new CEO is trying to out do his predecessor in ridiculous side bets that waste stock holder capital. Bezos was teflon but the teflon left when Bezos did. They need to close international in any market where they are not a dominant number 1 player like in the US. They need to jettison their ridiculous investments in Pill Pak and Whole Foods which continue to drain capital and for what gain? How long does it take to say those were mistakes? They need to make US operations profitable. They need to rationalize the SKUs in each warehouse for profitability and convert the unprofitable SKUs to fulfillment by Amazon. And then there is Amazon's entertainment division. Exactly how is that going to drive profitable growth? How much did they pay for Thursday night football?All of this reminds me of GE after Jack Welch ... They are essentially a cloud storage company with some logistics that they don't make money on. Heading to 90 after it breaks 101

AMZN

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Amazon: Do Not Cherry Pick The Positives Of This Quarter

Amazon's disappointing quarterly results came as a surprise to many. See why I believe AMZN stock outperforming market in coming years seems unlikely.

SeekingAlpha

Amazon: Do Not Cherry Pick The Positives Of This Quarter Summary - Amazon underperformed the market by a very wide margin in recent months and recent quarterly results do not help. - It is important not to fall victim of confirmation bias by cherry-picking the positive developments of the recent quarter. - Recent developments also highlight the importance of understanding exposure to momentum trade in this challenging market. - Problems associated with profitability and free cash flow will continue to weigh on the share price for the foreseeable future. - Looking for a helping hand in the market? Members of The Roundabout Investor get exclusive ideas and guidance to navigate any climate. Learn More » It has been only six months since I warned of the risks associated with: - Amazon's (NASDAQ:AMZN) unsustainable valuation; - Its heavy exposure to the fading momentum trade. At the time all that sounded as science fiction and it was almost inconceivable to put 'Amazon' and 'unsustainable valuation' in once sentence. Unfortunately, it now becomes clear that my pessimistic take on the company has been too forgiving as Amazon's share price lost more than 26% of its value in a matter of months and the after-market reaction to yesterday's results points to even more pain ahead. During this abysmal performance for AMZN at a time when the broader market fell by only 12.7%, the sentiment towards Amazon has remained almost completely one-sided. From retail to institutional investors and Wall Street Analysts, a bearish thesis was almost non-existent and this one-sided view was one of the factors for AMZN to be in the position it is today. Following the yesterday's results and the overall performance over the past months, Wall Street analysts will mostly likely follow the trend now and downgrade the stock. But if anything, this 'follow the herd' mentality is proving extremely dangerous for shareholders of growth companies in this highly uncertain environment. The Obvious Reason The most obvious reason for Amazon's plummeting share price are the expectations of deaccelerating topline growth. This is the area where most people get blind sighted by the eye-watering growth rates and high hopes for the future. After all, how can Amazon's share price be falling sharply after a 19% year-on-year growth rate? For the third quarter, worldwide net sales were $127.1 billion, representing an increase of 19% year-over-year, excluding approximately 460 basis points of unfavorable impact from changes in foreign exchange rates. Source: Amazon Q3 2022 Earnings Transcript After all, the Q4 2022 revenue guidance did fall short of expectations, however, it appears that unpredictable changes in exchange rates are largely to blame. As I look ahead to guidance for Q4, I think the biggest individual factor is still going to be foreign exchange. This guidance includes 460 basis points of unfavorable impact year-over-year. FX is a bigger issue for us on our revenue growth in dollars than it is on our income. It actually has a slight favorability due to the investments we're making internationally. Source: Amazon Q3 2022 Earnings Transcript At the same time the growth drivers of Amazon are firing on all cylinders. The advertising business grew at impressive 30% rate. We also saw good growth in our advertising offerings where sales grew 30% year-over-year, excluding the impact of foreign exchange (...) Source: Amazon Q3 2022 Earnings Transcript AWS did not disappoint either, with its topline growing at 28% and demand for cloud services remaining robust as clients are looking for ways to reduce fixed costs while not compromising security. In AWS, net sales increased to $20.5 billion in Q3, up 28% year-over-year, excluding the impact of foreign exchange, and now representing an annualized sales run rate of $82 billion. Source: Amazon Q3 2022 Earnings Transcript Overall, Amazon continued growing over the period with outside factors, such as foreign exchange rates being largely to blame. Although Q4 guidance fell short of expectations, it is not hard to use the latest reported results in conjunction with the extreme response in the share price to only support the bullish investment thesis behind the company. Why This 'Overreaction'? To understand why Amazon's share price is reacting so negatively to all these developments, we should get a grasp of how the equity market works under these times of unprecedented intervention and liquidity. Without going into too much detail, high momentum stocks and especially those seen as the disruptors of our time have been the main beneficiaries of the monetary experiment that begun in 2009 and peaked around 2020-21 period. You can read in detail about all that in my first analysis of Amazon, as well as in my recent analyses of the semiconductors and cloud sectors. The latter does a very good job at explaining how tiny changes to topline expected growth rates could have a disproportional impacts on valuation multiples for high growth names. Back to Amazon, the company's share price has been highly dependent on the market's premium for growth that is slowly normalizing. In the graph below, I measure this by the relationship between AMZN's daily returns of the past 6-months with an index that takes long position in the Vanguard Growth ETF (VUG) and a short position in the Vanguard Value ETF (VTV). This is even more troubling, if we compare Amazon's current exposure to the growth index with that from September 2021 to April 2022. As we see from the graphs above, not only is the relationship much stronger, but the steepness of the trendline has also increased dramatically over the recent months. What that means is that Amazon's share price has become even more dependent on its ability to deliver better than expected growth and the overall market premium paid for that growth. As I highlighted back in April, this dynamic is not uncommon for almost all mega cap tech names, but the case of Amazon is made even worse by its profitability and free cash flow profile. Why Was Amazon Not Spared The obvious pushback here would be that all high quality tech names that have been growing fast over the recent years are more or less exposed to the dynamic shown above. However, in the case of Amazon, the company did not have a highly profitable business model to rely on the same way as Microsoft (MSFT) is. Therefore, as the already thin profitability wanes, Amazon's share price is being hit with a disproportionally higher force. Moreover, the recent quarter only confirmed fears that the slowdown of the global economy in conjunction with the inflationary environment puts Amazon's e-commerce business at enormous risk. Although AWS is still doing the heavy lifting in terms of profitability, the gap with the rest of Amazon is growing at an alarming rates. Even though a drop in profitability in the North America and International segments was to be expected, the last quarter was even worse than most people expected. Moreover, there are early signs that profitability of AWS is likely peaking and could become subject to more volatility over the coming years. Not to mention the need to 'renegotiate pricing' with customers which makes things even worse in the highly competitive cloud sector. The broad disclaimer on AWS margins is that they will fluctuate over time as we balance investments versus renegotiating pricing with the long-term customer commitments, all as headwinds to the business, offset by increasing productivity and efficiencies in our data centers, which drive profitability. Source: Amazon Q3 2022 Earnings Transcript Having said all that, Amazon's huge workforce puts the company at a significant disadvantage to its peers in the cloud space as the inflationary environment puts pressure on wages. As if all that is not enough, the company's fixed costs have also become too stretched as a result of the ambitious plans to expand in areas such as Media, Health Services and Autonomous Driving. In a nutshell, Amazon has too much on its plate for a company that is all of a sudden having to deal with loss making e-commerce business and a highly competitive cloud unit. As a result, free cash flow is now deeply into negative territory which naturally makes investors extremely nervous even when considering the company's strong footprint. The double whammy effect of falling cash flow from operations and the need to massively increase capital expenditure to finance future growth that is even more uncertain is becoming a major issue for Amazon's share price. During the last quarter, the issues with rising operating costs and inventory levels in Asia were pointed out as two major reasons for the falling free cash flow, however high Capital Expenditure remains the key driver. While higher capital spend has been comforting investors as it supports future growth, it is troubling that the Capex budget has been cut by one-third over this year. And then CapEx is a big driver. We had, again, a doubling of the network, had very high CapEx the last two years. You'll see that we've lowered CapEx year-over-year. We probably cut about one-third of our budget from what we originally thought for 2022 while still focusing our capital dollars really on the AWS business and increasing customer demand or capacity for increasing customer demand in our stores business. Source: Amazon Q3 2022 Earnings Transcript As if all that was not enough for Amazon, the company also needed to further expand its stock-based compensation, which now makes a sizable share of the cash flow from operations. Conclusion Amazon's disappointing quarterly results came as a surprise to many, however, the writing on the wall was plain to see for anyone not blind sighted by the exciting narrative. Moreover, issues with the share price exposure to momentum trade is an issue that investors need to take seriously in the future and should not overlook as something trivial. To make matters worse, all the problems with Amazon's profitability and free cash flow have made the share price sensitivity to the growth rate premium mentioned above even more pronounced. While the 26% drop in share price over the past six months might seem as a good opportunity to buy, Amazon's business is now in a very tough spot and its share price outperforming the market in the coming years seems highly unlikely. Looking for better positioned high quality businesses in the cloud space? You can gain access to my highest conviction ideas in the sector by subscribing to The Roundabout Investor, where I uncover conservatively priced businesses with superior competitive positioning. The opportunities laid out in the service also capitalize on inefficiencies in the market associated with short-termism, momentum chasing and narrative driven expectations. For more information follow the link provided. This article was written by Vladimir Dimitrov is a former strategy consultant with a professional focus on business and intangible assets valuation. His professional background lies in solving complex business problems through the lens of overall business strategy and various valuation and financial modelling techniques. Vladimir has also been exploring the concept of value investing and in particular finding companies with sustainable competitive advantages that also trade below their intrinsic value. He supplements his bottom-up approach with a more holistic view of the markets through factor investing techniques. Vladimir made his first investment in farmland right out of high school in 2007 and consequently started investing through mutual funds at the bottom of the market in 2009. In the years that followed he has been focused on developing his own investment philosophy and has been managing a concentrated equity portfolio since 2016. Vladimir is LSE Alumni and a CFA charterholder . All of Vladimir's content published on Seeking Alpha is for informational purposes only and should not be construed as investment advice. Always consult a licensed investment professional before making investment decisions. Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Please do your own due diligence and consult with your financial advisor, if you have one, before making any investment decisions. The author is not acting in an investment adviser capacity. The author's opinions expressed herein address only select aspects of potential investment in securities of the companies mentioned and cannot be a substitute for comprehensive investment analysis. The author recommends that potential and existing investors conduct thorough investment research of their own, including detailed review of the companies' SEC filings. Any opinions or estimates constitute the author's best judgment as of the date of publication, and are subject to change without notice. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (22) 2) Convince Jeff to dump the Hollywood Homewrecker and crawl back to Mackenzie on his knees begging for forgiveness. Jeff can then return to full time working for us shareholders.

AMZN

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What to Look for in a Penny Stocks to Buy, 3 Things

Use these tips for finding penny stocks to buy

PennyStocks

3 Things to Look For When Finding Penny Stocks to Buy When it comes to penny stocks, there are a few things that investors should keep in mind. First and foremost, it is important to remember that penny stocks are highly volatile. This means that they can go up or down very quickly, and it is often difficult to predict which way the stock will move. For this reason, it is important to do your research before investing in penny stocks. Secondly, penny stocks can be much more liquid than other stocks. This means that they may move more than anticipated depending on what is going on in the market. While all of this can be good, it is crucial to understand your own risk tolerance before investing in penny stocks. Lastly, always remember to never invest more than you can afford to lose. [Read More] 3 Hot Penny Stocks To Watch With Unusual Options Activity This Week Penny stocks are a high-risk investment, and it is important to only invest what you are comfortable losing. By following these simple tips, you will be on your way to finding penny stocks that fit your investment goals. With this in mind, let’s take a look at what happened in the stock market on October 27th. What Happened in the Stock Market on October 27th On October 27th, both penny stocks and blue chips saw downtrends amidst weak performance from Amazon Inc. (NASDAQ: AMZN). By EOD, AMZN had dropped by more than 13%, leading to major bearish sentiment across the board. While it is impossible to say whether or not this will turnaround soon, we know that volatility has been characteristic of market performance in the past few months. With this considered, let’s take a look at three things to look out for if you’re interested in buying penny stocks right now. Buying Penny Stocks? 3 Things to Look For - Recent News Relating to the Company - Trading Patterns - What’s Going on in the Stock Market Recent News Relating to the Company When it comes to stocks, recent news can be critical in understanding whether or not a company is worth investing in. For example, let’s say there’s been a lot of negative press surrounding a particular company. In this case, it might be wise to avoid investing in that company’s stocks. On the other hand, if there’s been positive news relating to a company, it could be a good time to buy penny stocks from that company. Understanding recent news relating to penny stocks can help you make smarter decisions about which stocks to buy or sell. Of course, it’s important to do your own research before making any investment decisions. But, keeping up with the latest news can give you an edge when it comes to making money with penny stocks. This is especially true due to how speculative and volatile penny stocks can be. So, if you’re looking to make money in the stock market, don’t forget to stay up-to-date on the latest news. It could make all the difference in your investment decisions. Trading Patterns One of the most important things to understand when trading penny stocks is patterns. By understanding how a stock typically trades, you can better predict when to buy and sell. For example, if a stock usually starts the day off strong but then drops in the afternoon, you may want to sell it before lunchtime. If a stock tends to be volatile throughout the day, you may want to wait for it to settle down before buying. [Read More] 5 Short Squeeze Penny Stocks To Buy For Under $5 Right Now Within this, we see that trading strategies are also crucial. This includes short-term strategies like scalping and day trading, as well as longer-term strategies like swing trading and position trading. Of course, no stock is going to trade in a perfectly predictable pattern all the time. But by understanding how stocks typically trade, you can increase your chances of making money with penny stocks. What’s Going on in the Stock Market The stock market is a daunting and ever-changing beast. For the most part, it’s hard to predict what stocks will do on any given day. However, there are certain things that you can look at to get a general idea of how the market is doing as a whole. By knowing what’s going on in the stock market, you can be better informed when it comes to making penny stock investments. There are a few key indicators that can give you an idea of how stocks are performing overall. The first is the Dow Jones Industrial Average which is a major indicator for how the market is doing. The next is understanding macroeconomic factors such as inflation, interest rates, and unemployment. By taking a look at these larger indicators, you can get a better sense of how stocks will be performing in the short-term. This information can help you make better investment decisions when it comes to penny stocks. And as stated earlier, speculation is a crucial part of why penny stocks move, so understanding this from a larger level is crucial. 4 Penny Stocks to Add to Your Watchlist Right Now - Ambev (NYSE: ABEV) - AgroFresh Solutions Inc. (NASDAQ: AGFS) - View Inc. (NASDAQ: VIEW) - Camber Energy Inc. (NYSE: CEI) Are Penny Stocks Worth Buying or Not? Penny stocks are high-risk investments, but they can also be very rewarding. If you do your research and invest wisely, you could make a lot of money in penny stocks. However, you could also lose everything if you’re not careful. So, are penny stocks worth investing in? It depends on how much risk you’re willing to take. [Read More] Top Strategies for Making Money With Penny Stocks Before investing in penny stocks, it’s important to do your homework and understand the risks involved. Penny stocks are often very volatile, so it’s important to know what you’re doing before putting any money into them. If you’re willing to take on the risk, then penny stocks could be a great investment for you. Just remember to be careful and always do your research before investing. With this in mind, do you think penny stocks are worth buying or not?

AMZN

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Amazon: Disappointing Quarter Could Prompt Shares To Trade Lower

Amazon's Q3 reporting disappoints, as "recession proof" met "uncharted waters" for consumer spending. Click here to read my earnings analysis of the AMZN stock.

SeekingAlpha

Amazon: Disappointing Quarter Could Prompt Shares To Trade Lower Summary - Amazon's Q3 reporting disappointed, as "recession proof" met "uncharted waters" for consumer spending. - Revenues for the September quarter missed consensus by about $370 million. - Amazon now expects FY 2022 sales to be between $140 billion and $148 billion - versus analysts' expectations of around $155 billion. - The e-commerce profitability is very disappointing. And I argue investors should take note. - I reiterate a "Sell" rating for Amazon stock, and I lower my base case target price to $83.37 from $84.55 prior. Thesis I was cautious going into Amazon.com, Inc.'s (NASDAQ:AMZN) Q3 results, as I didn't like the negative implications of an additional Prime Day. And the e-commerce giant's reporting indeed disappointed: revenues for the September quarter missed consensus by about $370 million. But what was even more negative, given "uncharted waters" for consumer spending, Amazon now expects FY 2022 sales to be between $140 billion and $148 billion - versus analysts' expectations at around $155 billion. AMZN stock has lost as much as 14% following Q3 (pre-market reference). But I argue the stock can go even lower. Amazon suffers from depressed economic sentiment, which should contrast sharply to the belief that Amazon's business model would be recession-proof. This, paired with a rich valuation, I remain pessimistic about Amazon's near-/mid-term outlook. I reiterate "Sell," and I lower my base case target price to $83.37. Amazon's Q3 Quarter From July to the end of September, Amazon generated total revenues of about $127.1 billion, which compares to $110.8 billion for the same period one year earlier, representing a 15% year-over-year increase. Analysts, however, have expected sales to be around $127.4 - thus, Amazon missed by about $300 million. Amazon's net income came in at $2.9 billion, versus $3.2 billion in the same period a year ago. Moreover, net income decreased despite accounting for a $1.1 billion non-operating gain from re-valuing the Rivian Automotive (RIVN) stake. Operating income for TTM decreased to $12.97 billion. North America segment operating loss was $0.4 billion, compared with operating income of $0.9 billion in third quarter 2021. International segment operating loss was $2.5 billion, compared with operating loss of $0.9 billion in third quarter 2021. AWS segment operating income was $5.4 billion, compared with operating income of $4.9 billion in third quarter 2021. Honestly speaking, such an anemic profit is very disappointing for a +$1 trillion business. I understand that markets do not focus on Amazon's profitability. But perhaps they should. Outlook Disappoints Like Alphabet Inc. (GOOG, GOOGL) ("Google"), Microsoft (MSFT) and Apple (AAPL), Amazon warned of a clouded outlook, saying that the current economic environment: is uncharted waters for a lot of consumers' budgets. FY 2022 sales guidance was accordingly disappointing: Amazon now expects revenues for 2022 to be between $140 billion and $148 billion, which is as much as $15 billion lower than the median analyst estimates of $155 billion. Operating income for Q4 is estimated at around $4 billion, versus analyst consensus of about $5 billion. Amazon's disappointing quarter was driven by a depressed performance from the e-commerce business. But also "cloud" failed to convince. Sales from the cloud business increased by "only" 28% year-over-year, to $20.54 billion. Arguably, the buy-side was hoping to see growth at about/above 30%. Still Expensive - Downgrade Target Price Following a disappointing Q3 from Amazon, I upgrade my residual earnings model to account for lower earnings in late 2022, as well as 2023. However, I keep the cost of capital relatively low, at 8.25, and the terminal growth rate relatively high, at 4.5%(almost 2 percentage points above expected nominal GDP growth). Given the EPS downgrades as highlighted below, I now calculate a fair implied share price of $83.37, versus about $84.55 prior. Below is also the updated sensitivity table. Conclusion To be fair, Amazon is not the only FAANG that disappointed: Google dropped 10% following Q3, Meta Platforms (META) dropped 25%, and Microsoft fell as much as 7%. I believe, however, that Amazon is in a unique situation as compared to Big Tech peers - the company's profitability is much, much lower, and the valuation much, much richer. Accordingly, I personally would be worried about holding AMZN stock at above $100/share. The key point for my thesis is that I expect sentiment to change. For a long time, investors did not really care about AMZN's profitability. In fact, as I understand it, it has for a long time been a meaningless metric for Amazon, as the company almost appeared proud of the fact when they recorded negative earnings. Investors have been conditioned to accept it. But as recessionary conditions are biting, and investors will undoubtedly demand more discipline, Amazon's lack of profitability focus may prompt a repricing of the stock - lower. Following a disappointing Q3, I reiterate a "Sell" rating for Amazon stock and I lower my base case target price to $83.37 from $84.55 prior. This article was written by Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Not financial advice. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (5)

AMZN

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Tech titans grew by ignoring Wall Street. Now it could lead to their downfall

Mark Zuckerberg is sticking to his guns pouring billions into the ‘metaverse’, but should Silicon Valley’s founder kings take a hint from Amazon and look for cuts?

DowJones

Tech titans grew by ignoring Wall Street. Now it could lead to their downfall Mark Zuckerberg is sticking to his guns pouring billions into the ‘metaverse’, but should Silicon Valley’s founder kings take a hint from Amazon and look for cuts? Therese Poletti writes the Tech Tales column for MarketWatch Alphabet and Meta Platforms became two of the most valuable companies in the world by largely ignoring Wall Street and its concerns about their spending and big-money acquisitions. Now, in the thick of a slowdown in ad spending and with a potential recession looming, Wall Street...

AMZN

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Amazon: AWS Showdown

Amazon's bull case, AWS, is struggling to deliver against high expectation. See why I think investors are going to be a lot more skeptical of buying AMZN stock.

SeekingAlpha

Amazon: AWS Showdown Summary - Amazon's crown jewel, AWS, sees its growth rates dip below 30% CAGR. - AWS is losing market share not only to Microsoft but to Alphabet too. - AWS's profit margins compress y/y by 400 basis points. - Investors increasingly question whether valuations actually matter? - Is there enough value in AMZN at 45x next year's EPS? Probably not, if it's growing at less than 20%, while its margins are compressing. - Looking for a helping hand in the market? Members of Deep Value Returns get exclusive ideas and guidance to navigate any climate. Learn More » Investment Thesis Amazon's (NASDAQ:AMZN) bull thesis is today mostly focused on AWS. Investors wanted to see AWS still growing at +30% CAGR. Recall, Alphabet's (GOOG)(GOOGL) cloud was up 38% y/y, while Microsoft's Azure (MSFT) was up 42% in constant currency. Simply put, the dominant cloud company, AWS, is losing market share. There's no need to overcomplicate and over-intellectualize this dynamic. Consequently, we are looking at a stock that is by my estimates priced at approximately 45x next year's EPS, which is simply not growing on the topline anywhere near enough to support its valuation. Does that mean that Amazon is done for? Probably not. But it does mean that going forward investors are going to be a lot more skeptical of simply buying Amazon. I believe that is the case. The whole idea of investing for growth is now no longer as attractive as it was during the past several years. Amazon's Revenue Growth Rates Slow Down There are two key takeaways here. Firstly, that Amazon is no longer a high-growth company. You can see from its guidance that Amazon's revenues are expected to reach 8% at the high end. Including 460 basis points of FX-headwind, and we are at 13% CAGR. And so that there's no ambiguity that Amazon is lowballing estimates, consider the following table. What you see above is that over the past several quarters, Amazon has more often than not missed revenue estimates. So, that means that going forward, investors will increasingly be asking Amazon to show a bottom line that goes some way to support its valuation. Profitability Profile, AWS Margins Compress As I noted in my previous article, the bulk of the bull case is around AWS. This is not only the growth engine for Amazon, but it also has an extremely high-profit margins platform. That being said, in Q3 2022, operating margins were 26.31% compared with 30.31% in the same period a year ago, a 400 basis point compression y/y. So, not only did Amazon's AWS revenue growth rates slow down below that critical 30% CAGR handle, but margins compressed too. I specifically highlighted this concern just 2 days ago in my previous article. calling AWS' SMB exposure its Achilles Heel. AMZN Stock Valuation - 45x Next Year's Eps There are now going to be fair concerns around Amazon's ability to reach $2.28 of EPS next year. For my part, I ardently believe that this figure will need to come down by at least 5%, if not 10%. That means that Amazon reporting approximately $2.10 is probably a better approximation. That means that Amazon is priced at 45x next year's EPS. A multiple that I believe is too high relative to other high-quality compounders, even in tech. I'm not saying that Alibaba and Amazon are all that similar. Yes, Alibaba is predominantly an e-commerce platform with a cloud business attached and Amazon is mostly skewed towards a cloud business with an e-commerce business attached. Also, obviously, there's a substantial amount of political risk surrounding Alibaba. On yet the other hand, Alibaba is priced at around 8x EPS! While Amazon is clearly more expensive. On yet the other hand, there are a lot of regulators starting to circle around Amazon. That's something that is difficult to appraise and quantify but is becoming increasingly likely to have a substantial impact on Amazon's future prospects. The Bottom Line This has been one of the most interesting weeks of investing in a long time. There has been a changing of the guard. Many of the biggest and best winners of the past decade have now started to get repriced lower. This is astonishing. For investors, this week of October 2022 will go down in history. The same as March 2009 during the great financial crisis, March 2000 in the dot-com period, and October 1929 in the Great Depression. On the positive news, these periods are extremely rare. And we have just gone through it now. What comes out on the other side will be materially better. Good luck. We are now much closer to the bottom than we were at the start of the year. Strong Investment Potential My Marketplace highlights a portfolio of undervalued investment opportunities - stocks with rapid growth potential, driven by top quality management, while these stocks are cheaply valued. I follow countless companies and select for you the most attractive investments. I do all the work of picking the most attractive stocks. Investing Made EASY As an experienced professional, I highlight the best stocks to grow your savings: stocks that deliver strong gains. - Deep Value Returns' Marketplace continues to rapidly grow. - Check out members' reviews. - High-quality, actionable insightful stock picks. - The place where value is everything. This article was written by Our Investment Group is focused on value investing as part of the Great Energy Transition. For example, did you know that AI uses thousands of megawatt hours for even small computing tasks? Join our Investment Group and invest in stocks that participate in this future growth trend. I provide regular updates to our stock picks. Plus we hold a weekly webinar and a hand-holding service for new and experienced investors. Further, Deep Value Returns has an active, vibrant, and kind community. Join our lively community! We are focused on the confluence of the Decarbonization of energy, Digitalization with AI, and Deglobalization. As an experienced professional, I highlight the best stocks to grow your savings: stocks that deliver strong gains. DEEP VALUE RETURNS: The only Investment Group with real performance. I provide a hand-holding service. Plus regular stock updates. Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (22) You are right about one thing, though - it IS all about Prime. Overspending on perks for Prime members is one of the "prime" reasons the non-AWS operations are in the red.

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‘Pretty much Google 2.0’ — Amazon price targets reduced by analysts, though they say the long-term story is intact

Analysts downgraded their price targets for Amazon after it reported missing its third quarter sales expectations alongside a weak sales forecast for the...

MarketWatch

Analysts downgraded their price targets for Amazon.com after it reported missing its third quarter sales expectations alongside a weak sales forecast for the upcoming festive season. Amazon AMZN, The e-commerce giant also said it expects to report fourth quarter revenue between $140 billion and $148 billion, around $10 billion shy of analyst expectations. “We’re very optimistic about the holiday but we’re realistic that there are various factors weighing on people’s wallets,” said Amazon Chief Financial Officer Brian Olsavsky to analysts on a call on Thursday evening. “While we are encouraged by our progress across the business, macroeconomic environment remains challenging worldwide,” Olsavsky added. “The continuing impacts of broad-scale inflation, heightened fuel prices and rising energy costs have impacted our sales growth as consumers assess their purchasing power and organizations of all sizes evaluate their technology and advertising spend.” “The good news here is that the story isn’t broken, it’s just pushed out into 2023 while Q4 may get worse before it gets better… pretty much Google 2.0,” said Mark Shmulik, an analyst from Bernstein, who maintained an outperform rating of Amazon but cut the price target to $125 from $150 per share. Read: Alphabet is ‘a big ship to turn around,’ when it comes to much-needed belt-tightening, but Wall Street has faith JPMorgan analysts led by Doug Anmuth believe the pressures on Amazon are “largely macro-driven, and not fundamental.” It kept its overweight rating but lowered its price target to $145 from $175 per share to reflect the value of its cloud services. Amazon Web Services Amazon Web Services, which accounted for most of the company’s $2.9 billion profit, saw its slowest revenue growth since 2014 of 27%. “Similar to the start of the pandemic AWS clients are asking for discounts and rationalizing and/or migrating their workloads to cheaper products. The pipeline remains robust, but expect some pricing pressure in the near-term coinciding with more aggressive competition,” added Shmulik. Also: Why the rout for big tech companies may just be getting started Aaron Kessler, an analyst from Raymond James, kept its outperform rating due to “solid long-term eCommerce growth” and “continued leadership and momentum in cloud”. Kessler did slash his price target for Amazon from $164 to $130 per share due to the slower AWS growth and lower fourth quarter margins. “While we expect a more challenging growth outlook near-term, we remain positive on long-term growth for both retail and AWS with improving margins over time as Amazon focuses on productivity improvements,” he said.

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11 Biggest Malls in Europe

In this article, we take a look at the 11 biggest malls in Europe. You can skip our detailed analysis of the European mall industry and go directly to 5 Biggest Malls in Europe. Market Outlook The European retail industry is valued at $3.6 trillion as of 2021 according to Statista. There are roughly 10,000 […]

Yahoo

11 Biggest Malls in Europe In this article, we take a look at the 11 biggest malls in Europe. You can skip our detailed analysis of the European mall industry and go directly to 5 Biggest Malls in Europe. Market Outlook The European retail industry is valued at $3.6 trillion as of 2021 according to Statista. There are roughly 10,000 malls in Europe as of 2021, with the United Kingdom taking the biggest share with over 1,500 malls, per their report. The European mall industry’s economic outlook is not very different from those of other regions when it comes to the mall's traditional purpose. Malls in general are declining in popularity, owing to factors like E-Commerce. The online sales already make up 15% of total shopping in most of Europe. The average retail growth is around 4% while online sales grow by an average of a far higher 20%. In fact, the pandemic lockdowns accelerated the E-Commerce growth to 43% in 2020, adding massive amount of value to stocks like Amazon.com, Inc. (NASDAQ:AMZN), Walmart Inc. (NYSE:WMT) and Target Corporation (NYSE:TGT). Moreover, the persistent inflation around the world and the central banks' rate hikes in response have put the mall industry on a slippery slope, as consumers cut back on spending. This has led European REITs to start adapting to a changing shopping landscape. An Adapting Industry One of the ways the industry is adapting is extended diversification, with European malls adding more and more experience and service-based incentives, like museums, art galleries, government offices and theme parks etc. Florencio Beccar, the fund manager of CBRE Global Investors' European Shopping Center Fund, was quoted by NBC News at the purchase of a German mall that came with a medical facility. He said that purchasing malls with services like medical facilities and others is a major advantage to offset decline in physical retail. In addition to that, many REITs are moving towards logistics, which is another way the European mall industry is trying to adapt and survive. According to CBRE research, every $1 billion addition in online sales requires an additional space of 1.3 million square feet in warehouses, raising the demand for fulfillment centers. Insofar as Europe is concerned, a Prologis report showed that every additional 1 billion euros in online sales resulted in an average increase in warehouse demand of almost 72,000 square meters in Britain, Germany, and France, during the studied period of 2007-2012. Logistics also has a cost advantage. Retail space costs around $20 per square foot while the same for logistics costs only $6.5. Its yield is also two percentage points higher on average than retail. This has resulted in malls across the world in general and malls in Europe in particular, attempting to transition and rezone the spare retail spaces in their buildings for the logistics business. Simon Hope, the global head of capital markets for the UK-based property consultant Savills, confirmed the trend with NBC News, saying, “logistics is the new retail.” Key Players There are thousands of malls in Europe but some of the most prominent names in the industry are Mega Belaya Dacha in Russia, Westfield Centro in Germany, Bluewater in the UK and Istanbul Cevahir in Turkey. As far as mall-owning REITs are concerned, Klépierre SA (OTCMKTS:KLPEF) is the biggest mall owner in Europe. It owns 155 malls across 16 European countries. Now that we know the state of the mall industry in Europe, let’s move on to the 11 biggest malls in Europe. Pixabay/Public Domain Our Methodology For our list of the 11 biggest malls in Europe, we’d be ranking them based on their total area. We’ve gotten the data from the malls’ websites. We’d also be discussing factors like total retail space, number of retail stores and restaurants, as well as number of anchor tenants etc. 11. Puerto Venecia (Port Venice) Location: Zaragoza, Spain. Total Floor Area: 200,000 m² Puerto Venecia is the biggest shopping mall in Spain. It is located in Zaragoza city. The mall has a total floor area of 200,000 square meters. It is divided into different segments. There’s a boulevard, a gallery, leisure and restaurant space and a lake. The mall is home to over 150 retail stores and 45 restaurants. Prominent stores include NIKE, Inc. (NYSE:NKE), Apple Store by Apple Inc. (NASDAQ:AAPL), Xiaomi Corporation (OTCMKTS:XIACY) tech store, Primark, H&M and ZARA. Notable among its featured restaurants is Taco Bell. For leisure, the mall offers facilities like cinema, gaming center and lake boating. In 2013, it won the Mapic Award in the category of Best Retail and Leisure Development. Port Venice has significantly expanded beyond retail ever since online shopping has taken to the skies in Spain as a result of global reach of companies like Amazon.com, Inc. (NASDAQ:AMZN), Walmart Inc. (NYSE:WMT) and Target Corporation (NYSE:TGT). 10. Bluewater Location: Dartford, England. Total Floor Area: 200,000 m² Bluewater is one of the biggest malls in the UK, with a total floor area of 200,000 square meters. It is located in Stone, in the borough of Dartford, Kent. The mall offers a retail space of 155,000 square meters. It has 330 retail stores and three anchor tenants, namely, Marks and Spencer Group plc (OTCMKTS:MAKSY), House of Fraser and John Lewis & Partners. It also features 40 restaurants and cafes like KFC by Yum! Brands, Inc. (NYSE:YUM), and McDonald’s Corporation (NYSE:MCD). It serves roughly 27 million people annually. Bluewater is owned by four corporations: Land Securities Group plc (LSE:LAND.L), Prudential plc (NYSE:PUK), M&G Real Estate and Federated Hermes, Inc. (NYSE:FHI). 9. Trafford Center Location: Greater Manchester, England. Total Floor Area: 207,000 m² Trafford Center is another huge mall and entertainment complex in the UK. It is located in Dumplington, Trafford, Greater Manchester. The complex has a total floor area of 207,000 square meters, with a retail space of 185,000 square meters. It has 200 stores and six anchor tenants. Trafford Center features many stores. Few prominent examples are stores from Apple Inc. (NASDAQ:AAPL) and The Gap, Inc. (NYSE:GPS). Its restaurants and cafes include names like McDonald’s Corporation (NYSE:MCD), KFC by Yum! Brands, Inc. (NYSE:YUM), and Starbucks Corporation (NASDAQ:SBUX). The mall also features many attractions like The Tinsel Town, Big Wheel and Ice Skating. There are also facilities that exclusively exist to make the experience convenient for families. For instance, the mall offers ‘fun buggies’ for children so parents can shop more easily. 8. MEGA Khimki Location: Khimki, Russia. Total Floor Area: 210,000 m² MEGA Khimki, located in Khimki, Russia, is the Khimki branch of MEGA Family Shopping Centers. These are managed by IKEA Centers Russia. It has roughly 200 retail stores and features three anchor tenants, namely, Auchan, OBI and Leroy Merlin. Other prominent brands include The Gap, Inc. (NYSE:GPS) and Starbucks Corporation (NASDAQ:SBUX). However, after the Ukraine War, the majority of western brands have stopped doing business in Russia. MEGA also offers many experience-oriented facilities like Cinema and Sports centers. 7. Westgate Shopping City Location: Jablanovec, Croatia. Total Floor Area: 226,000 m² Westgate Shopping City is the largest mall in Croatia and the seventh largest on the list of biggest malls in Europe. It has a floor area of 226,000 square meters, out of which, 100,000 square meters are allotted to retail stores. It has a family-oriented shopping and entertainment theme. There are many facilities apart from retail and dining like inline skating, cinema and park. The notable brands that have opened stores in Westgate include TEDI, Pepco, H&M and New Yorker. Aside from shops and restaurants, Westgate features leisure and entertainment facilities like multi-screen cinemas. 6. Westfield London Location: London, England. Total Floor Area: 240,000 m² Westfield London is the biggest mall in the UK and one of the biggest malls in Europe. It is the London chapter of Westfield malls, and is located in White City, London. It has a total floor area of 240,000 square meters. It is owned by Westfield Corporation. The mall features six anchor tenants and over 450 retail stores. Some of its important stores belong to companies like NIKE, Inc. (NYSE:NKE), Apple Inc. (NASDAQ:AAPL), LEGO, and Adidas. Insofar as restaurants and cafes are concerned, some prominent brands providing service at the mall are Nando’s, Burger King and Starbucks Corporation (NASDAQ:SBUX). Westfield London also offers many leisure and entertainment attractions. One that stands out is The Upside Down House. Other attractions include a cinema, bars, bowling alley and a mini-golf course. Many of the products available at the mall are usually also available at online shopping platforms like Walmart Inc. (NYSE:WMT), Amazon.com, Inc. (NASDAQ:AMZN) and Target Corporation (NYSE:TGT). Click to continue reading and see 5 Biggest Malls in Europe. Suggested articles: 11 Biggest Malls in the World: Will Higher Interest Rates Bankrupt The Industry? Disclosure: none. 11 Biggest Malls in Europe is originally published on Insider Monkey.

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Cyber Monday online sales expected to break $11.2 billion

Yahoo Finance Live's Dave Briggs examines the revenue forecast figures for Black Friday and Cyber Monday sales, along with the performance of retail stocks.

Yahoo

Cyber Monday online sales expected to break $11.2 billion Yahoo Finance Live's Dave Briggs examines the revenue forecast figures for Black Friday and Cyber Monday sales, along with the performance of retail stocks. Video Transcript [AUDIO LOGO] - Now, you're taking a close look at retail stocks as well. DAVE BRIGGS: Yeah, two really big stories today. We'll get to China in a moment, but let's get you up to speed first on Cyber Monday and the retail numbers are coming in. Online sales expected to hit $11.2 billion. Today, that's up from $10.7 billion last year, according to Adobe. And that comes on the heels of a record breaking Black Friday, which topped the $9 billion mark, up 2.3% from a year ago. One surprise from those numbers-- well, there's many surprises, just going to highlight one. Walmart eclipsing Amazon among shoppers searching online for Black Friday deals. Let's check on how the shopapalooza is moving the markets today. Stocks from Amazon up, Walmart in the green, Target up, Kohl's the notable, down retail stock among the 5, and Best Buy up a bit. So a nice day for the retail sector.

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Which supermarket rules Philadelphia? These grocery store chains have the highest sales in the region

Sales from two supermarket chains make up more than 56% of the local market, according to data gathered from Food World.

Yahoo

Which supermarket rules Philadelphia? These grocery store chains have the highest sales in the region Sales from two supermarket chains make up more than 56% of the local market, according to data gathered from Food World. Sales from two supermarket chains make up more than 56% of the local market, according to data gathered from Food World.

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Mark Cuban: Here's why we couldn't close the Shark Tank-infused Woobles deal

A Triangle startup saw its Amazon sales take off after appearing on "Shark Tank." But mega startup investor Mark Cuban says a deal failed to come to fruition.

Yahoo

Mark Cuban: Here's why we couldn't close the Shark Tank-infused Woobles deal A Triangle startup saw its Amazon sales take off after appearing on "Shark Tank." But mega startup investor Mark Cuban says a deal failed to come to fruition. A Triangle startup saw its Amazon sales take off after appearing on "Shark Tank." But mega startup investor Mark Cuban says a deal failed to come to fruition.

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Is Amazon a Bargain Heading Into 2023?

The company has warned of slow growth this holiday season, but investors need to dig deeper

Yahoo

Is Amazon a Bargain Heading Into 2023? Amazon.com Inc. (NASDAQ:AMZN) has already warned of slow holiday growth. With the Federal Reserve continuing to raise interest rates, analysts predict the economy will enter a shallow recession in the first quarter of 2023, affecting the profitability of e-commerce companies. A major decline in consumer spending is one of the biggest concerns of investors and analysts alike, but recent data shows consumers continue to spend. Warning! GuruFocus has detected 6 Warning Sign with AMZN. Click here to check it out. Although the Seattle-based retail giant reported it will face a challenging environment in the coming quarters with the slowest holiday season growth in its history, there are signs that Amazon will have a better Christmas than expected. According to a recent Bloomberg report, regardless of rising interest rates, U.S. consumers are seeing prices moderate with retail sales growth hitting an eight-month high in October. Despite a deteriorating economic outlook, the fourth quarter has started on the right track with robust consumer demand. Exhibit 1: Change in retail sales Source: Bloomberg According to Insider Intelligence, online sales are predicted to increase 12% year over year in November and December, exceeding the 10.4% growth that was seen in 2017. The Cyber Five period, which is the five days between Thanksgiving and Cyber Monday, typically outperforms the holiday season growth. During this period last year, Amazon experienced record sales, which did not come as a surprise after almost two years of lockdowns. This year, Cyber Five sales are anticipated to generate $34.8 billion, or 16.3% of the season's revenue, which is in line with the growth of overall holiday sales. Cyber Monday is expected to clock in the biggest year-over-year growth of 5.1% this year. Additionally, Deloitte's holiday retail survey found 49% of consumers intended to shop during the Thanksgiving week, with consumers planning to keep spending at a similar level to last year and the majority shopping at online-only retailers. Given these holiday shopping trends, Bloomberg data shows that analysts anticipate Amazon's revenue will increase 6.7% to $146.6 billion in the fourth quarter, slightly higher than what the company has guided for. Challenges and opportunities Despite reporting year-over-year revenue growth, Amazon fell short of investors' expectations in the third quarter due to the impact higher inflation had on consumer demand and operating income. The company will continue to feel this pressure for a little longer given macroeconomic challenges are expected to continue in the near term. The company saw revenue grow by 15% in the third quarter, but international revenue growth slowed due to unstable exchange rates, the deteriorating business environment in Europe and the energy crisis. Regardless, the e-commerce business continues to grow rapidly in the North American region. Amazon's cloud business also fell short of analyst expectations, which is cause for concern given that AWS is the only segment that has contributed to the company's growing operating income in 2022. The slowdown, however, is only temporary and enterprise spending on cloud infrastructure services remains strong. According to Synergy Research Group, spending on cloud infrastructure services exceeded $57 billion in the third quarter, up 24% year over year. Additionally, there are numerous opportunities for cloud infrastructure providers to expand, particularly in the small business segment, as only a small percentage of businesses have migrated to the cloud to date. With its expansion into new regions, Amazon will maintain its position as the market leader and record positive growth in the coming years. To capture the massive growth opportunities for cloud products in India as the country undergoes a digital transformation, AWS launched a new infrastructure region in Hyderabad, India on Nov. 22 with three availability zones, making it the country's second region for data center clusters. With this launch, AWS has grown to 96 availability zones spread across 30 geographic regions. Amazon has also been recognized as a leader for the 12th consecutive year in the Gartner Magic Quadrant for Cloud Infrastructure & Platform Services. Exhibit 2: Gartner Magic Quadrant for CIPS Source: Gartner One major challenge for Amazon has always been managing supply chain disruptions and fulfillment network productivity. However, the company has made strides in cost management, which it acknowledged in its earnings report. The company expects new initiatives will help it build a stronger cost structure in the future. In a recent report titled "The Fulfillment Network: Built Through 2024," Morgan Stanley (NYSE:MS) noted Amazon has sufficient warehouse capacity to handle its volumes through the fourth quarter of 2024. The company has opened new fulfillment centers in the United States, Mexico, Canada, Ireland and Turkey to serve more customers even faster. The company plans to cut its capital expenditure budget by a third this year and has already announced job cuts that will last through early next year, which is a common strategy used by companies to reduce costs. Amazon aggressively increased its headcount during the pandemic, more than doubling it since the end of 2019 to 1.5 million. The retailer admitted it exceeded its target and now needs to reduce staff and close non-essential businesses. These initiatives are expected to significantly reduce Amazon's capital expenses and fulfillment costs in 2023. Exhibit 3: Quarterly fulfillment expenses Source: Third-quarter earnings report All this said, it will take time for the companys efforts to result in strong earnings growth. Amazon's advertisement segment, on the other hand, remains strong, while its competitors struggle with slower ad spend. In the U.S., Amazon is by far the most popular e-commerce platform. With over 200 million Prime members, it is also appealing to advertisers and sellers. This year's Prime Day sales remained strong, with 300 million items purchased globally. Amazon is also expanding advertising opportunities on its streaming platform, Amazon Prime, to assist marketers in taking advantage of video ads. Exhibit 4: Number of items purchased by Amazon Prime members worldwide during Prime day sales (in millions) Source: Statista Another challenge to consider is the increasing competition in India, one of the largest and least explored markets for e-commerce. While the region has been Amazons largest overseas and fastest-growing market, it has a limited presence in tier 2 and tier 3 cities and is losing market share to new competitors like Meesho. The size of the companys logistics network is also restricting the products available for same-day delivery, which may impact membership growth. One survey also found that Amazon is falling short in terms of download share and engagement metrics. In terms of seller presence and product mix, it remains the largest platform in the country. Further, Amazon has a stake in local stores as well as five well-known private labels in India. Exhibit 5: Festival market share in India Source: TechCrunch The company also entered the digital payment market in India with the launch of Amazon Pay, but it is reporting losses due to regulatory challenges. With over 15,000 e-commerce companies currently in operation, the Indian e-commerce industry is rapidly expanding. The competition will only heat up as the number of internet users in India grows dramatically and the government increases its support for local startups. Considering the intense competition and Amazon's performance in India since the start of the pandemic, it is only reasonable to assume the company will face many challenges in this region in the coming quarters. Takeaway Given the likelihood of improved consumer spending during the holiday season, planned productivity initiatives for the first quarter of 2023 and a significant decrease in capital expenditures, Amazon seems well-positioned to generate higher-than-expected operating income. Investors, however, will have to tread lightly as the general pessimism surrounding risk assets might result in lower share prices for growth stocks in the coming months before recovering meaningfully. Amazon still has a long runway for growth in the next decade, which makes the stock an attractive bet for long-term growth investors. This article first appeared on GuruFocus.

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Buy Amazon on Cyber Monday? Check the Charts First

Amazon stock is struggling to rally on Cyber Monday, as the charts flash caution. Here's how bulls can trade it from here.

Yahoo

Buy Amazon on Cyber Monday? Check the Charts First Amazon stock is struggling to rally on Cyber Monday, as the charts flash caution. Here's how bulls can trade it from here. Amazon stock is struggling to rally on Cyber Monday, as the charts flash caution. Here's how bulls can trade it from here.

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Early Holiday Sales Beat Modest Expectations

U.S. consumers sifted discounted merchandise for bargains during 2022's first holiday shopping weekend as early indicators pointed to resilient demand despite high inflation and recession worries. Shares of leading discounters Walmart (WMT) and Target (TGT) gained modestly Monday, as did those of electronics chain Best Buy (BBY). Amazon (AMZN) rose as well amid Cyber Monday promotions.

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Early Holiday Sales Beat Modest Expectations U.S. consumers sifted discounted merchandise for bargains during 2022's first holiday shopping weekend as early indicators pointed to resilient demand despite high inflation and recession worries. Shares of leading discounters Walmart (WMT) and Target (TGT) gained modestly Monday, as did those of electronics chain Best Buy (BBY). Amazon (AMZN) rose as well amid Cyber Monday promotions.

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Amazon: Why AWS Is Worth $60

I believe Amazon's most important value driver, AWS, should be valued at ~$60 a share. Click here to read why I remain neutral on shares of AMZN.

SeekingAlpha

Amazon: Why AWS Is Worth $60 Summary - I believe Amazon's most important value driver, AWS, should be valued at ~$60 a share, representing roughly 2/3 of the current market value. - While the recent slowdown appears to be more cyclical than secular, Amazon's growth is unlikely to return to pandemic levels, since revenue was boosted by many transitory factors. - As a mid-20%s grower, AWS deserves some conservatism on the valuation side of the story as markets increasingly turn to Amazon's overall profitability in a slower growth environment. - Therefore, I would remain on the sidelines for Amazon and revisit the buy case should shares reach $80, a price consisting of a fair value for both AWS and Advertising. Why is AWS slowing down? In Q3 2022, Amazon.com, Inc. (NASDAQ:AMZN) reported Amazon Web Services, Inc. ("AWS") revenue of $20.5 billion (+27% YoY) and a 3-point sequential decline in EBIT margin to 27% during the quarter. The slowdown in Q3 top-line was a 6-point deceleration from 2Q22 vs. a 4-point deceleration from Q1 to Q2. While AWS is a much larger business today and the law of large number has certainly contributed to some of the moderation in revenue growth, there are a number of reasons noted by Amazon management, as well as by peers including Microsoft (MSFT) and Google (GOOGL, GOOG). The first reason behind the AWS slowdown is higher cost sensitivity amongst customers. The term "cost optimization" was mentioned by both Amazon and Microsoft management several times during their Q3 2022 conference calls. This essentially means finding cheaper ways to run various workloads on the cloud, such as moving to lower-tier storage and compute capabilities and shifting from higher-priced pay-as-you-go to lower-priced Reserved Instances. By default, AWS bills customers on a consumption basis every month. This on-demand model can become quite expensive when customers are running a lot of workloads and deploying many instances. As a result, an AWS reserved instance allows customers to get discounted billing when they agree to use a specific instance for a period of 1-3 years, which could benefit customers with more steady usage in the form of a lower hourly rate. Second, cloud migration has become a longer process as customers look to tighten the belt in a downturn. The initial costs associated with migrating legacy on-premise workloads to the cloud are usually high, and CFOs may want to delay such projects until recession risks are gone. This was noted on Google's Q3 2022 call, where management highlighted longer sales cycles and smaller contracts in GCP. While AWS certainly provides a cost advantage by running workloads using its proprietary Graviton CPUs, the upfront costs (e.g., hiring a 3P consulting firm) to convert corporate operations to AWS could cause many companies to delay the modernization process given usage/consumption is likely to be low in a recessionary environment anyway. The third factor is lower overall consumption in verticals affected by current macro conditions. Industries such as financials, gaming, digital advertising, and e-commerce are seeing normalizing activities in a post-pandemic environment with rising interest rates. On its Q3 2022 call, Amazon management noted slowing mortgage businesses and a challenging crypto market that partially contributed to the slowdown in AWS revenue growth. The recent FTX scandal suggests confidence in cryptocurrencies is unlikely to return anytime soon. If prominent crypto platforms such as Coinbase (COIN) continue to experience muted trading activities as retail investors lose their life savings on Luna to FTT, that means lower consumption/revenue for major cloud infrastructure providers as well. Cyclical or secular? The deceleration in AWS revenue growth (+40% to +25% in 4 quarters) as well as Azure and GCP appears to be more cyclical than secular as demand for digital transformation during the pandemic (work from home, rush to move operations to the cloud, gaming, streaming, crypto, e-commerce, etc.) significantly biased the growth rates to the upside. Given the 3 factors discussed above are largely macro-driven, a 2023 recession remains a wildcard that will likely put further pressure on AWS growth as consumption falls and companies look to cut costs more aggressively. Since Amazon reported Q3 2022 results, consensus AWS revenue and EBIT margin for 4Q22 have been reduced from $23 billion (+29% YoY) and 31% to $22.2 billion (+25% YoY) and 28% (vs. 30% in 4Q21). The current Q4 top-line estimate is consistent with Amazon's comments that AWS growth moderated to ~25% exiting Q3. The 2-point deceleration from Q3's 27% is better than a 5-point deceleration in Azure growth per Microsoft's Q4 guidance. Therefore, I see downside risk to Street estimates and would conservatively model Q4 AWS revenue of $21.7 billion (+22% YoY vs. +25% consensus). This brings 2022E AWS revenue to slightly over $80 billion, up 29% from 2021. For 2023, consensus estimates currently call for AWS revenue of just over $100 billion (+25% YoY). While this number may be achievable given continued growth and an AWS backlog of $104 billion (+57% YoY) at Q3, it's important to recognize that the backlog does not have to translate into revenue right away, since customers may not necessarily hit their contract commitments in a slower environment. If the economy does materially deteriorate in the next few quarters, it's possible for AWS growth to decelerate into the low 20%s in 1H23 vs. strong 1H22 comps (+37%/+33% in 1Q/2Q22), in my view. How much is AWS worth? The question now becomes how much is AWS worth as a mid-20%s grower, as verticals that are severely challenged by macro pressures are unlikely to recover quickly in 2023. I've previously valued AWS at 6x 2023 revenue or ~$60 per share, with the target multiple being at the midpoint of Microsoft (8x) and Oracle (ORCL) (4x). This may seem conservative to many, but I believe taking such a defensive view provides some scope for the possibility of markets shifting Amazon's valuation framework from SOTP to P/E. For a long time, investors have been used to finding Amazon's fair price by valuing each of its businesses individually. This does not always have to be the case, considering Amazon is now a much more mature business with low-double-digit revenue growth being the norm vs. 25%+ previously. Given investors are no longer operating in an easy environment with accelerating growth, it's possible that markets will turn to Amazon's overall profitability as a key element of the valuation framework. In that scenario, Amazon is trading at a rather demanding multiple of 54x 2023 earnings. Conclusion I remain neutral on shares of Amazon given the narrative of "buying AWS and getting everything else for free" may not apply to the current price of $93 if markets are to take a conservative view on the valuation side of the AWS story in a slower-growth environment. That said, it may be difficult to expect shares to reach as low as $60 before pulling the trigger considering Amazon also has a robust, high-margin advertising business that could be worth ~$20 a share by applying a 4.5x P/S multiple (a slight premium to Google's 4x) to 2023E revenue of $44.5 billion (+18% YoY vs. +21% in 2022E). Putting it all together, I'll remain on the sidelines for Amazon.com, Inc. for now and revisit the buy case when shares reach $80. This article was written by Analyst’s Disclosure: I/we have a beneficial long position in the shares of MSFT, GOOG either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (61)

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3 Ways Dollar Stores Can Make the Holidays Less Expensive for You

If you're deep in the throes of your holiday shopping, you may have certain stores you want to hit in the course of buying gifts. Target might be a big one on your list, as might Costco. You might even decide to purchase some of your gifts online if Amazon has prices that are hard to compete with.

Yahoo

3 Ways Dollar Stores Can Make the Holidays Less Expensive for You If you're deep in the throes of your holiday shopping, you may have certain stores you want to hit in the course of buying gifts. Target might be a big one on your list, as might Costco. You might even decide to purchase some of your gifts online if Amazon has prices that are hard to compete with.

AMZN

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Amazon Likely To Reach Truce With EU Over Antitrust Concerns Soon

Amazon.com Inc (NASDAQ: AMZN) looked to settle European antitrust probes over how the U.S. e-commerce giant uses rivals’ sales data and whether it unfairly favors its products. The European Commission will likely accept Amazon’s binding proposals by the end of the year, Bloomberg reports. The proposals included a commitment to stop using data on independent sellers on its marketplace for its competing retail business. Also Read: Amazon, Netflix, Meta And Other Big Tech Could Soon Have To Compens

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Amazon Likely To Reach Truce With EU Over Antitrust Concerns Soon Amazon.com Inc (NASDAQ: AMZN) looked to settle European antitrust probes over how the U.S. e-commerce giant uses rivals’ sales data and whether it unfairly favors its products. The European Commission will likely accept Amazon’s binding proposals by the end of the year, Bloomberg reports. The proposals included a commitment to stop using data on independent sellers on its marketplace for its competing retail business. Also Read: Amazon, Netflix, Meta And Other Big Tech Could Soon Have To Compensate Telcos For Bandwidth In Europe It’s still subject to scrutiny from Germany’s Federal Cartel Office and the U.K.’s competition watchdog. The company’s settlement offer also promises to apply equal treatment to all sellers when ranking their offers for the selection of the winner for a “buy box,” where Amazon highlights sellers of a particular product. While the settlement will likely be rubber-stamped next month, it could extend into next year. Settling the EU investigations means the company will avoid a fine of as much as 10% of its global turnover. Price Action: AMZN shares traded higher by 1.29% at $94.62 on the last check Monday. See more from Benzinga Amazon To Close Down More Indian Operations As Slowdown And Competition Pinches Black Friday Surprise: Walmart Beats Amazon In Online Searches For Deals Don't miss real-time alerts on your stocks - join Benzinga Pro for free! Try the tool that will help you invest smarter, faster, and better. © 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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Amazon Vows to Replenish All the Water It Uses for Data Centers

(Bloomberg) -- Amazon Web Services, the largest cloud-computing provider, is promising by 2030 to replenish the water its massive data centers consume, the latest environmental pledge from the internet giant. Most Read from BloombergNext Covid-19 Strain May be More Dangerous, Lab Study ShowsApple to Lose 6 Million iPhone Pros From Tumult at China PlantKey Trump 2024 Rivals Silent After His White Supremacist MeetingParent company Amazon.com Inc. said in a statement Monday it’s supporting efforts

Yahoo

Amazon Vows to Replenish All the Water It Uses for Data Centers (Bloomberg) -- Amazon Web Services, the largest cloud-computing provider, is promising by 2030 to replenish the water its massive data centers consume, the latest environmental pledge from the internet giant. Most Read from Bloomberg Scientists Revive 48,500-Year-Old ‘Zombie Virus’ Buried in Ice An Arizona County’s Refusal to Certify Election Results Could Cost GOP a House Seat Stock Traders Cheer Powell’s Risk-Friendly Shift: Markets Wrap NYC Becomes One Billionaire Family’s Haven From China Property Crash These Are the Best and Worst Cities for Expats to Live and Work In Parent company Amazon.com Inc. said in a statement Monday it’s supporting efforts to replenish groundwater in California, the UK and India to offset the water the company’s cloud centers use. Google, which has vowed to offset 120% of its water usage, revealed last week that its global data centers consume 4.3 billion gallons of water a year. Microsoft Corp. has already committed to replenish more water than it consumes by the end of the decade. Data centers use a considerable amount of electricity and water to cool the racks of servers and computers. While Amazon and its rivals have disclosed more of their energy footprints, they have been less willing to share how much water they use. That’s caused political tension in areas facing droughts. AWS declined to share the total gallons it consumers, but reported that in 2021 it used a quarter liter of water for every kilowatt-hour of electricity at its data centers. That metric is the best reflection of water efficiency, said Will Hewes, global water lead for AWS. Right now, AWS said it relies on recycled water for 20 of its data centers, including two in drought-stricken California, but it’s challenging to expand that number because re-using water is often tricky in regions where utilities aren’t set up for the practice. “Water is complicated,” Hewes said. Most Read from Bloomberg Businessweek TikTok’s Viral Challenges Keep Luring Young Kids to Their Deaths The Avatar Sequel Is a Make-or-Break Moment for Disney’s $71 Billion Fox Deal Global Debt Costs Are Soaring. Here’s Where It Will Hurt Most ©2022 Bloomberg L.P.

AMZN

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Amazon to shut down its food delivery business in India

Yahoo Finance Live's Rochelle Akuffo discusses reports that Amazon will shut down its food delivery business in India as part of the company's cost-cutting measures.

Yahoo

Amazon to shut down its food delivery business in India Yahoo Finance Live's Rochelle Akuffo discusses reports that Amazon will shut down its food delivery business in India as part of the company's cost-cutting measures. Video Transcript RACHELLE AKUFFO: Right, well, the world's largest e-commerce company is calling it quits on its food delivery business in India. Amazon confirming to Reuters that it will shut down Amazon Food by year's end, which it launched at the peak of the pandemic in May of 2020. Now the move comes after the company announced it's shutting down its EdTech business, Amazon Academy, as part of its cost cutting measures. Earlier this month, it announced it was laying off over 10,000 employees due to uncertain macroeconomic conditions. So clearly still biting Amazon right now.

AMZN

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Amazon.com Inc. stock outperforms market on strong trading day

Shares of Amazon.com Inc. inched 0.58% higher to $93.95 Monday, on what proved to be an all-around grim trading session for the stock market, with the S&P...

MarketWatch

Shares of Amazon.com Inc. AMZN, +1.30% inched 0.58% higher to $93.95 Monday, on what proved to be an all-around grim trading session for the stock market, with the S&P 500 Index SPX, +0.67% falling 1.54% to 3,963.94 and Dow Jones Industrial Average DJIA, +0.93% falling 1.45% to 33,849.46. Amazon.com Inc. closed $85.85 short of its 52-week high ($179.80), which the company reached on November 29th. The stock outperformed some of its competitors Monday, as Apple Inc. AAPL, -0.28% fell 2.63% to $144.22, Microsoft Corp. MSFT, +0.19% fell 2.32% to $241.76, and Alphabet Inc. Cl C GOOG, +0.72% fell 1.38% to $96.25. Trading volume (74.6 M) remained 4.1 million below its 50-day average volume of 78.8 M.

AMZN

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Cyber Monday: How an Amazon warehouse prepares for the holiday rush

Amazon Warehouse General Manager Prateek Dahiya speaks with Yahoo Finance’s Allie Garfinkle at Amazon’s Oxnard facility about Black Friday and Cyber Monday volumes, hiring, deals, and what it’s like inside the warehouse amid the holiday shopping season.

Yahoo

Cyber Monday: How an Amazon warehouse prepares for the holiday rush Amazon Warehouse General Manager Prateek Dahiya speaks with Yahoo Finance’s Allie Garfinkle at Amazon’s Oxnard facility about Black Friday and Cyber Monday volumes, hiring, deals, and what it’s like inside the warehouse amid the holiday shopping season. Video Transcript [AUDIO LOGO] BRIAN SOZZI: Amazon is gearing up for a big cyber week, even as signs mount that consumers are spending cautiously this holiday season. Let's go right out to California, where we find Yahoo Finance tech reporter Allie Garfinkle inside an Amazon warehouse. Allie? ALLIE GARFINKLE: Hi, Brian. I'm here in Oxnard, California, at OXR1, and I'm here with Prateek Dahiya. He is the general manager of this warehouse that's been ramping up for Cyber Monday. So Prateek, thank you so much for being here. PRATEEK DAHIYA: I appreciate it. ALLIE GARFINKLE: So tell me about what it takes to prepare for Cyber Monday for your-- from your perspective. PRATEEK DAHIYA: Yeah, Cyber Monday and Black Friday are the most-- one of the most important days for Amazon. It starts the peak season for-- for the holidays. So really, really, a lot of things go into preparing for these amazing days, so starting with getting the right freight and all the inventory that consumers want to buy. So we start that about a month ago. Then we start hiring, which we ramped up around 1,000 associates here in this building. And then we, of course, start planning with our central teams and support partners and of course our amazing transportation vendors, both at Amazon and outside to start delivering those smiles to our customers. ALLIE GARFINKLE: And you hired quite a bit, actually. You said in summer, you had about 1,500 employees. And now you have about 2,500. PRATEEK DAHIYA: Yeah. ALLIE GARFINKLE: Tell me about that process. PRATEEK DAHIYA: Yeah, we are a relatively new building. We started in January of this year. So of course, ramping up from 1,500 associates in the summer to about 2,500 plus was a great effort, and we really appreciate the community that we are a part of. So we had almost 70% of our associates from this tri-county coastal area, which is a part of Ventura, Camarillo, and Oxnard. So great efforts, word of mouth, references from all the associates who were already working, and that's how we got here. And we're looking forward to ramp up again for the forthcoming peak seasons. ALLIE GARFINKLE: And talk to me about the stakes of the Cyber Monday. How important is Cyber Monday for you, especially in a holiday season where people were-- consumer slowdown has really been something that's talked about? PRATEEK DAHIYA: No, it's super important. It's a-- it's a very important day. Cyber Monday is traditionally one of the biggest shipping days for Amazon, and we started great with Black Friday. So definitely, it sets the tone for the peak season, and we are looking forward to increasing demand from consumers. Amazon is still one of the best places where consumers want to use low prices and amazing selection and faster delivery speeds to get their gifts for their loved ones. ALLIE GARFINKLE: And then talk to me about, you know, Amazon this past year has had some labor problems, particularly in New York, but I wanted to hear your perspective. What's your take on what it's like to work at an Amazon warehouse? PRATEEK DAHIYA: Yeah, look, Amazon believes in direct relationship with associates, and we believe in direct engagement, which has been very positive in this particular building, for sure. As I said, we ramped up from 1,500 to 2,500 associates. And that's more from word of mouth. We see a lot of family and friend members working in the same building in the same shift. We have a great employee relation with them. We offer great benefits from insurance and also from amazing other benefits that people, associates can take discounts outside Amazon as well. So we have a great partnership with our associates, and we would have not have them if that partnership did not exist between associates. So that's what we believe in, a direct relationship with associates and our management. ALLIE GARFINKLE: And last question, is there anything different about this Cyber Monday? PRATEEK DAHIYA: Well, I'm personally looking forward to some amazing electronic deals-- so a lot of amazing deals in health and wellness. Of course, outdoor has been very-- very big this year as people have started going out with the pandemic. So amazing selection. I personally have to look forward to them for myself and looking forward to buying myself a couple of items this year. ALLIE GARFINKLE: Prateek, thank you so much. Back to you guys in the studio. PRATEEK DAHIYA: Thank you so much. JULIE HYMAN: And thank you, Allie. I appreciate it. Obviously, very busy day there.

AMZN

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Datadog: Strong Growth And Outstanding Execution

Datadog, Inc. is a tremendous company and a true technology powerhouse. Click here to read why DDOG stock could be a great long-term investment.

SeekingAlpha

Datadog: Strong Growth And Outstanding Execution Summary - Datadog, Inc. is a leader in IT Observability and has over 22,200 customers, which include Sony, Samsung, Shell, Deloitte, the Washington Post, and many more. - The company reported solid financials for the third quarter of 2022, beating both revenue and earnings growth estimates. - Datadog is poised to benefit from growth trends across the cloud, IT observability, Big Data, and recently Cybersecurity with its new products. Many companies are going through a "Digital Transformation" in which they aim to transfer their onsite IT resources to the cloud. This is great for increased performance, flexibility, and cost savings. However, it also brings with it a whole host of new challenges. This includes monitoring data across various different Cloud-based applications. Datadog, Inc. (NASDAQ:DDOG) solves this problem as a leader in IT. Observability, its software platform, brings together data from multiple sources and enables observability, querying, control, and recently security. The company is a Gartner Magic Quadrant leader in Application Performance Monitoring [APM], as you can see from the chart below. The cloud computing market was worth $450 million in 2021. It is forecasted to grow at a rapid 19.9% compounded annual growth rate [CAGR] and be worth over $1.7 trillion by 2029. Datadog is poised to benefit from this growth trend, and estimates the IT Observability industry to increase in value from $38 billion in 2021 to $53 billion by 2025. In this post, I'm going to break down the company's financials and valuation, so let's dive in. Strong Third Quarter Financials Datadog reported strong financial results for the third quarter of 2022. Revenue was $437 million, which increased by a rapid 61% year-over-year and beat analyst expectations by $22.28 million. This was driven by solid customer growth, from 17,500 in Q3,21 to 22,200 by Q3,22. The company has continued to grow "upmarket," and its high-ticket customers with an Annual Recurring Revenue of $100,000 or more increased from 1,800 to 2,600 year over year. Amazingly, these few enterprise customers generate 85% of the business's annual recurring revenue, thus it is clear that catching whales is a solid strategy. Datadog is a cloud monitoring platform that has continued to execute its "platform" strategy in an outstanding manner. The Datadog platform has 15 products, which include its legacy Application Performance Monitoring [APM], Log Management, Real User Monitoring, Cloud Workload Security, and more. Its new security platform is particularly interesting as application security has become a strategic priority for organizations. The global cyber security industry was worth $185 billion in 2021, and is forecasted to grow at a steady 12% compounded annual growth rate, to over half a trillion by 2030. Datadog uses a "land and expand" approach to upselling and cross-selling its various products on its platform. For example, 80% of its customers are using at least two products. 40% of customers are using at least 4 products and 16% of customers are using over 6 products. Due to the aforementioned strategies and value proposition of the product, it is no surprise that the company has a 130% dollar-based net retention rate. This means customers are staying with the company and spending more on upsells. Profitability and Expenses Datadog has a super high gross margin of 80%, which is characteristic of SaaS (software as a service) platforms. The company is operating at a loss on a GAAP basis, but is profitable on an adjusted basis with stock-based compensation ("SBC") added back. Datadog reported GAAP earnings per share of negative $0.08 in the quarter, which beat analyst expectations by $0.02. Its Non-GAAP EPS was negative $0.08, which beat analyst expectations by $0.02. This equates to a healthy 20% Operating Margin in the trailing 12 months on a Non-GAAP basis. The company is investing approximately 30% of its revenue into Research and Development, which isn't really bad, as companies in the technology industry must continually innovate to stay ahead. In addition, companies that invest more in R&D tend to produce greater shareholder returns over time, for example, Alphabet/Google (GOOG, GOOGL) or Amazon (AMZN). Datadog is "doubling down" its investments into the business's two new products, Data Stream Monitoring and Cloud Cost Management. Both of these products have high demand from customers. The idea of moving to the cloud is to offer greater flexibility, control, and ultimately cost savings long term. Therefore, during a recessionary environment, I imagine there will be strong demand for its Cloud Cost Management solution. Datadog has gradually optimized its Sales and Marketing Expenses, which have declined from 43% of revenue in 2017 to just 24% in the trailing 12 months, which is a positive sign. General and Administrative expenses have also demonstrated operating leverage as its percentage of revenue has reduced from 10% in 2017 to 6% in the trailing 12 months. As Datadog's investments have paid off, its Free Cash Flow Margin has increased from 6% in 2017 to 24% trailing 12 months or $364 million. This is a Non-GAAP measure that capitalizes software development costs and minuses Capex. Datadog has a solid balance sheet, with $1.766 billion in cash and short-term investments. In addition to total debt of $836.7 million, of which the vast majority [$738 million] is long-term debt. Advanced valuation In order to value Datadog, I have plugged the latest financials into my advanced valuation model which uses the discounted cash flow ("DCF") method of valuation. I have forecasted a 37% revenue growth rate for next year and 40% over the next 2 to 5 years. This is aligned with the most recent growth rate figures and guidance, but I am predicting a slight improvement in years 2 to 5, as the economy is likely to recover. I have forecasted a 23% target pre-tax operating margin in 6 years, which is the average of the software industry. I expect this to be driven by the continued improvements in the operating efficiency of the business, as its scales. Given these financials, I get a fair value of $90 per share for Datadog, Inc. The stock is trading at $75 per share at the time of writing, and is thus 82% undervalued. As an extra data point, Datadog trades at a Price to Sales ratio = 15, which is 58% cheaper than its 5-year average. As you can see from the chart below, Datadog is trading at a higher valuation than its competitors, but it is the market leader and growing faster than its peers. Risks Recession/Longer Sales Cycles The high inflation and rising interest rate environment has caused many analysts to forecast a recession. Companies are acting increasingly cost-conscious, and thus I expect longer sales cycles for any B2B business. The good news is Datadog's focus on its new cost optimization products could be a key selling point for businesses. Final Thoughts Datadog, Inc. is a tremendous company and a true technology powerhouse. The company is continually innovating, executing strong and has a loyal growing customer base. Datadog, Inc. stock is undervalued intrinsically and relative to historic multiples, thus it could be a great long-term investment. This article was written by Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (5) 98.67% of 1730 companies in the Software industry Industry Median: 13.15 vs DDOG: 464.70The stock trading down to a 52w low of $62 probably tells the story on valuation. Plus it didn’t really participate in the latest rally. Which I thought very odd until I started looking at the valuation. I own shares in the company, but this is just how I see it. Growth is great, this is why I’m still invested and trying not to worry about the valuation to much.

AMZN

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2 FAANG Stocks to Buy Now

After the dramatic drop in their share prices, these tech giants have become attractive picks for long-term investors.

Yahoo

2 FAANG Stocks to Buy Now After the dramatic drop in their share prices, these tech giants have become attractive picks for long-term investors. After the dramatic drop in their share prices, these tech giants have become attractive picks for long-term investors.

AMZN

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Stocks: Amazon and Walmart gain, Bed Bath and Beyond slides on Cyber Monday

Yahoo Finance's Brad Smith breaks down how retail stocks are moving at the open.

Yahoo

Stocks: Amazon and Walmart gain, Bed Bath and Beyond slides on Cyber Monday Yahoo Finance's Brad Smith breaks down how retail stocks are moving at the open. Video Transcript - And-- [BELL RINGING] --it's not quite a steaming pile this morning. We have a little bit of-- - You're going to use it again. You liked it. - --a decline. - You just don't want to admit it. - A little bit of a decline here in this, as we see this enthusiastic remote opening for the US market. - How do you say that name? "Quaft?" - Qraft. - Qraft. - I think it's probably Qraft. - I'm just trying to figure it out. I don't know. - Q-R-- BRAD SMITH: If you are Donald Duck, yes. - Yeah, right, "Quaft." - In any case, as we look at the setup here this morning, Sozz, you referenced it briefly earlier, right, the Goldman note that we-- I mean, we get a Goldman note every Monday, but Goldman talking up the recession chances, right, in its most recent note? - Yeah, I encourage everyone, go to YahooFinance.com. You can see the story I wrote up. It's about 300 words, quick read. Share with everyone. But then outlining that at least from a broader market perspective, a recession next year is not priced into stocks. They're recommending people stay overweight cash. What does that mean in plain English? They want you to have more cash in your portfolio than stocks. - All right, that's kind of similar-- - What we do. - --to what we were hearing from John Augustine a few moments ago as well. BRAD SMITH: Yeah, indeed, well, taking a look at how we've opened up here just after the opening cross, we've got the Dow Jones Industrial average up by about-- or excuse me-- lower by about 3/10 of a percent. We've opened here on the day, down by about 112 points for the Dow NASDAQ composite. That's lower by about 7/10 of a percent, 70 points to the downside there. And then the S&P 500, you're seeing that lower by about 6/10 of a percent. On this Cyber Monday, I want to take a look at some of the retail names that are also on the move here. You've got Amazon. That's higher by about 7/10 of a percent, Walmart, as well as Home Depot also in positive territory. And just kind of putting this an an equal setting here, just to get a good look at where you've got some of the divide that's taking place, oh, yes, surprise, surprise, Bed Bath Beyond, that is down by about 3%. - I think they're still trying to get people through the door for Thanksgiving. Good luck. BRAD SMITH: Yeah. Yeah. It's the foot traffic concern, as well as the heavy promotional environment right now. Macy's as well, that's down by about 6/10 of a percent. We'll keep an eye on that one as we move forward throughout the day, but interesting, catching a bid for Nike. You've got Foot Locker. We're going to have an interesting discussion later on about the resale market, even in this holiday season too. So stay tuned for that conversation.

AMZN

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Informatica: Good Business, Good Product, But Fairly Valued

Informatica is a vendor-agnostic platform that addresses the needs of all user types. Click here to read my analysis of INFA stock and why it's a hold.

SeekingAlpha

Informatica: Good Business, Good Product, But Fairly Valued Summary - There are several challenges faced by companies in properly managing data. - Informatica Inc. enjoys a strong network effect. - Informatica is a vendor-agnostic platform that addresses the needs of all user types. - Informatica has strong partnerships with key players. Investment thesis What Informatica Inc. (NYSE:INFA) basically does is provide a means for their customers to efficiently manage their data without having to waste too much time while doing so. Their platform is cloud-based, and they have an AI engine called Claire that makes the whole process speedy yet meticulous. A lot of companies nowadays are having problems managing their data. In light of this, INFA provides a new and better means to carry out this process. They have partnered up with strong players in the industry, and this puts them in an advantageous position. Also, their platform is designed in such a way that it can be easily used by every employee in an organization and improve the work in the company, generally. However, I believe INFA is fairly valued today and investors should wait to deploy capital when valuation gets cheaper. Business overview INFA has developed a new means for businesses to correctly monitor the place where their data settles, have an in-depth knowledge of the kind of connection that prevails in their various data depositories, and also know who can get a hold of the data and how the data is being used. All of these functions are carried out on an enterprise level. INFA's cloud-native platform continuously examines their customers' data in order to create a rich and thoroughly scrutinized metaverse, as well as to create and control a metadata system of record that serves as the primary source of truth about their data. As such, their AI engine, CLAIRE, is able to assist customers by helping them have access to their data more quickly, give contextual suggestions on data connections, reveal novel observations about their business, and computerize duties that were formerly manual. Several challenges faced by companies to properly manage data In the present era of relentless pursuit of digital transformation ideas to rework businesses, data is one of the most crucial and irreplaceable competitive assets that companies possess. The world's population, software, and hardware collectively generate enormous data sets. In order to transform into data-driven enterprises, organizations are looking into methods of consolidating data across their many IT applications, systems, and environments. Better insights across the board, enhanced customer service, mechanized supply chains, and consistent, secure, and governed data access for all employees can be achieved by understanding and combining these data assets and migrating the workload to the cloud. To make matters worse, the proliferation of mobile, social, and IoT data, combined with the growth of cloud computing, low-cost data storage, and the expansion of applications that create and access data, is leading to a data explosion in terms of volume, variety, and velocity. While it is now possible to generate deeper business insights and pursue untapped market niches thanks to the influx of fresh data, this plethora of information, however, is beyond the capacity of managing organizations to manage, aggregate, and standardize. Further, as more businesses take advantage of cloud-based services, more data is generated and stored in various SaaS applications and storage places. The crucial thing to note here is that data is stored in a variety of formats across different data repositories, making it challenging to aggregate it into a consistent, long-lasting, and useful whole. The difficulty in integrating data from various sources within an organization in order to gain a fresh understanding and support strategic decision making is exacerbated by the ongoing fragmentation (i.e., where the data are stored). In reality, the purpose of data management software is to give businesses complete command over their data at all points in its existence. In order to achieve this goal, it is necessary to have access to data from multiple sources, standardize data across formats, filter data for quality, join data to destinations, govern data access, secure data from all breaches, and create a single source of truth for data. However, businesses are still employing older methods of data management for strategic and one-off use cases, despite the fact that these methods only address a subset of the full data management lifecycle. If businesses truly become data-driven, the data strategies they use to support their digital transformation initiatives will be severely constrained by their reliance on legacy approaches. There are a number of significant problems with the existing solutions, including: - Many traditional methods of data management have inherent flexibility, scalability, and extensibility because they were not designed specifically for the introduction of cloud-based workloads. These products, which are usually server-based, may only be able to manage a subset of the total data and may necessitate additional resources in order to prevent issues with the user experience, such as latency and unpredictable price spikes. The inflexibility and incompatibility of the non-native cloud approach usually result in the loss of expertise, the accumulation of unnecessary data, and the slowing of innovation. - Legacy data management methods were made for a few types of structured data that usually come from internal business systems. This can make it hard to capture, control, organize, group, and govern semi-structured and unstructured data that is constantly coming in from connected devices, apps, and social media. When dealing with the massive amounts of disparate, unstructured data being generated by a diverse set of users all over the world, businesses have a hard time scaling their data management initiatives. Many of these methods can only help with analytical frameworks. They aren't good enough to handle the use and streaming of data at high speeds from devices that are connected to each other. - In most cases, the methods used to manage data in the past were simply band-aids designed to fix specific problems. Typically, enterprises do not integrate these methods into their overarching end-to-end data management strategy. For instance, while some current products can standardize various data types, they may fall short in providing the necessary governance and security for organizations to deal with the quality of their data as it currently stands. Vendor-agnostic platform INFA’s platform and products have advanced performance in any database, data source, or third-party application. They are using this approach as enterprises have now updated and revamped their infrastructures and moved lots of their workloads to the cloud. This completely contrasts to a lot of companies that have built their data management capabilities in such a way that they only work within their own products and platforms or have presented products that cannot control data in both on-premises and cloud environments. In a world where most companies are now adopting a multi-cloud, hybrid strategy and where data fragmentation is a major barrier to making sound decisions in an enterprise, INFA sure does have a major and continuous competitive advantage. Addresses the needs of all types of users INFA allows all major stakeholders in an organization to easily make use of their all-inclusive data management capabilities. Their products can be easily and quickly used in the organization, saving time for the users. There is also a user experience that they offer. This reduces the amount of technical skills that the user may require, and as a result, it effectively coordinates data within an organization's employees while maintaining the expected functionality. This enables the universality of their platform, as every employee in the organization can further improve their performance in their work. INFA enjoys strong network effect Many of INFA's benefits can be attributed to its strong network effects. More and more customers are using their platform, which means that the amount of metadata it controls is rapidly expanding. Because of this increase in metadata, CLAIRE is better able to understand complex data management tasks, and automation is progressing. For instance, when disparate customer datasets stored in various formats are combined, CLAIRE readily highlights inconsistencies and errors in the data. As a result, the potential damage to a company's bottom line from inaccurate information is mitigated thanks to the insights and automation provided by CLAIRE. It saves a ton of time by reducing the need to manually examine each data point in massive datasets. CLAIRE's recommendation engine and automation will also naturally improve as it continues to process and analyze more business rules and data. I am confident that these factors will encourage more INFA customers, both current and prospective, to adopt the INFA platform and reap the benefits of using Informatica for their data management needs. Strong partnerships with key players From the onset, INFA has always proven itself to be a reliable partner, satisfying the needs of the most demanding enterprises. INFA’s relationship with these demanding enterprises only shows that they are able to meet the most complex needs of these enterprises. That alone gives them a competitive advantage over others. Additionally, they have well-grounded relationships with three leading cloud hyperscalers. They are: AWS (AMZN), Microsoft (MSFT) Azure, and Google (GOOGL) Cloud Platform. These relationships enable their customers to deploy and use INFA on all of these cloud platforms. They sell their products on their marketplaces, and they strongly encourage the direct sales reps of the hyperscalers to share and distribute their products, for which they receive quota credit on the sale of their platform. They are also partners with Snowflake Inc. (SNOW) and Databricks. With all of these partnerships, INFA should always be one step ahead of the competition and will have the opportunity to market their platform to both new and existing customers. Valuation My model suggests that INFA is fairly valued today. My model values INFA on a forward earnings basis, as the business is generating profits. The model follows management’s FY22 guidance and high-single-digit growth (similar to historical growth rates), which I believe are achievable given INFA’s competitive advantages and a strong network effect. INFA is trading at 21x forward earnings today, and I assumed it would trade in a similar range 1 year from now, as I do not expect any major events that would change this. Based on these assumptions, I believe INFA’s stock is worth $17.73 in FY23. Risks Industry adoption rate may not grow fast It's possible that the market for cloud-based data management solutions has already reached the same level of maturity as the market for on-premise products. It might also not grow as much as it is expected to. Also, the acceptance might be stoic due to a number of reasons, like concerns about data security, privacy, cost, etcetera. A lot of customers have invested significant amounts of resources in conventional on-premise software solutions, and because of that, they might not be willing to move and start using cloud-based solutions. Conclusion I believe Informatica Inc. is an interesting and exciting company with a lot to look forward to. However, the market is not pricing it cheaply enough for me to deploy capital to invest in it. I would encourage readers and investors to hold back on investing and wait for a cheaper valuation. This article was written by Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments

AMZN

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Analyst Says Coinbase 'A Waste Of Time', Taylor Swift's Concert Fiasco Under DOJ Probe, Shopify Clocks Record Black Friday Sales: Top Stories Monday, Nov. 28

CNBC After FTX Collapse, 'Crypto Is Dead' And Coinbase' A Waste Of Time:' Mizuho Analyst Dan Dolev, a Mizuho Americas analyst, believes that crypto may be finished after the recent troubles at FTX (FTT/USD), a bankrupt crypto exchange. Dolev said in an interview with CNBC that he thinks "crypto is dead" and "investing in Coinbase (NASDAQ: COIN) is just a waste of time." Wall Street Journal Did AOC Prompt A Justice Department Investigation Over A Taylor Swift Concert? The U.S. Justice Department

Yahoo

Analyst Says Coinbase 'A Waste Of Time', Taylor Swift's Concert Fiasco Under DOJ Probe, Shopify Clocks Record Black Friday Sales: Top Stories Monday, Nov. 28 CNBC After FTX Collapse, 'Crypto Is Dead' And Coinbase' A Waste Of Time:' Mizuho Analyst Dan Dolev, a Mizuho Americas analyst, believes that crypto may be finished after the recent troubles at FTX (FTT/USD), a bankrupt crypto exchange. Dolev said in an interview with CNBC that he thinks "crypto is dead" and "investing in Coinbase (NASDAQ: COIN) is just a waste of time." Wall Street Journal Did AOC Prompt A Justice Department Investigation Over A Taylor Swift Concert? The U.S. Justice Department (DOJ) is investigating whether Ticketmaster's parent company, Live Nation Entertainment Inc (NYSE: LYV), has abused its power. The investigation announcement leaves some wondering if Rep. Alexandria Ocasio-Cortez (D-NY), aka AOC, prompted the investigation over her calls to break up the "monopoly" following the significant failure of Taylor Swift's pre-sale concert tickets. Bloomberg Why Wynn, MGM Resorts And Other Casino Stocks Are Gaining Today Shares of Casino operators Wynn Resorts Limited (NASDAQ: WYNN) and MGM Resorts International (NYSE: MGM) gained on Monday after being granted operating licenses in Macau. Six casino operators in Macau have been granted new licenses to continue their operations in the gambling hub. The move comes amid a weak market sentiment due to the Chinese government's reimposition of the Zero COVID policy. Amazon To Close Down More Indian Operations As Slowdown And Competition Pinches Amazon.Com Inc (NASDAQ: AMZN) looked to exit India's meal deliveries and a service providing bulk doorstep deliveries of packaged consumer goods to small businesses. The exits will involve layoffs of just several hundred out of a workforce of thousands, leaving Amazon relying on its core offerings like online retail in the country. CEO Andy Jassy's cost-reduction campaign came amid slowing growth in several areas of Amazon's business. BMW Sees More Lockdowns in China In 2023 Bayerische Motoren Werke AG (OTC: BMWYY) sees more Covid-related lockdowns in China as a risk for next year, despite healthy demand for the carmaker's fully-electric models and expectations of stable global sales. CEO Oliver Zipse said, "I am worried about how we get out of the lockdown situation in future quarters. There is no visibility that China has a solution." Demand for BMW's fully-electric models in China is still strong, Zipse said, and next year's introduction of battery-only Mini models and the i5 should also help boost sales. 6M Shortfall In Apple iPhone Pro Models - China's FoxconnFoxconn's Plant Outrage Impact On Apple Turmoil at Apple Inc's (NASDAQ: AAPL) key manufacturing hub of Zhengzhou is likely to result in a production shortfall of close to 6 million iPhone Pro units this year. Much will depend on how quickly Hon Hai Precision Industry Co Ltd (OTC: HNHPF) operating as Foxconn Technology Group, the Taiwanese company that operates the facility, can get people back to assembly lines after violent protests against Covid restrictions. Reuters Hyundai, LGES Plan To Build JV Battery Plants In US Hyundai Motor Company (OTC: HYMTF) plans to build two joint venture battery plants in the U.S. with LG Energy Solution Ltd. The proposed plants will be built in Georgia, located near the automaker's new EV plant, to help meet U.S. EV subsidy rules. Each plant is expected to have an annual capacity of about 35 gigawatt hours (GWh). Twitter Failed To Detect Newly Uploaded Footage Of Christchurch Mass Shooting — Until New Zealand Alerted Platform The New Zealand government said it had to alert Twitter after freshly uploaded footage of the Christchurch terror attack began circulating on the platform. The Elon Musk-led platform failed to recognize the content of the mass shooting — that occurred in a terrorist attack on two mosques in Christchurch — as harmful, the government said. "Twitter advised us overnight that the clips have been taken down and said they would do a sweep for other instances." Benzinga Coinbase Steps Up Europe Expansion Despite Crypto Meltdown Coinbase Global Inc (NASDAQ: COIN) strengthened its European top ranks to help lead its regional expansion plans. Cormac Dinan, a general manager at Crypto.com, joined Coinbase as country director for Ireland. Michael Schroeder, former chief compliance and risk officer at Bittrex, will join the crypto exchange as director of controls for Germany. Twitter Users Have Trouble Blocking Accounts — Elon Musk Responds Twitter users who had problems blocking accounts on the microblogging site can now do so without facing any interruption. Twitter owner Elon Musk tweeted that the microblogging site "experienced slight degradation of service" caused by "an old 3rd party tool." He added that the issue "should be fixed now." AstraZeneca Bets On UK-Listed Firm For Lung Diseases Drug Discovery company C4X Discovery Holdings plc has signed an exclusive worldwide licensing agreement with AstraZeneca plc (NASDAQ: AZN) worth up to $402 million for its NRF2 Activator program. C4X Discovery is listed on the London Stock exchange, and the deal is the third significant deal with a major pharmaceutical company. AstraZeneca will develop and commercialize an oral therapy for inflammatory and respiratory diseases with a lead focus on chronic obstructive pulmonary disease. Rio Tinto, PKKP Reach Historic Agreement To Create Juukan Gorge Legacy Foundation The Puutu Kunti Kurrama & Pinikura (PKKP) Aboriginal Corporation and Rio Tinto plc (NYSE: RIO) have agreed to create the Juukan Gorge Legacy Foundation after signing a remedy agreement regarding the tragic destruction of two ancient rock shelters at Juukan Gorge in the Pilbara region of Western Australia in 2020. Either party did not disclose financial terms at the request of the PKKP, the parties said. Axsome Therapeutics Investigational Drug Lowers Risk Of Agitation Relapse In Alzheimer's Patients Axsome Therapeutics Inc's (NASDAQ: AXSM) AXS-05 substantially and statistically significantly delayed the time to relapse and prevented relapse of agitation in patients with Alzheimer's disease, compared to placebo. The ACCORD Phase 3 trial represented a 3.6-fold lower relapse risk than the placebo. AXS-05 also met the key secondary endpoint of relapse prevention based on the relapse rates during the double-blind treatment period (7.5% of AXS-05 patients vs. 25.9% of placebo patients). Barclays CEO Temporarily Excuses Himself For Curable Cancer Treatment Barclays PLC (NYSE: BCS) CEO, C.S. Venkatakrishnan, informed the Barclays Board and his colleagues that he would be undergoing treatment for Non-Hodgkin Lymphoma. Non-Hodgkin lymphoma is a type of cancer, meaning he would work from home for some time. The CEO, known inside the bank as Venkat, said in a letter that his condition was curable and that doctors have said his prognosis is "excellent," with the treatment in New York expected to last 12 to 16 weeks. The bank confirmed that it had not appointed any interim CEO, with Venkat and the lender's executive committee expected to continue running it. Shopify Clocks Record Black Friday Sales Shopify Inc (NYSE: SHOP) had a record-setting Black Friday with sales of $3.36 billion from Black Friday in New Zealand to the end of Black Friday in California. The sales marked a 17% growth year-on-year (19% Y/Y on a constant currency basis). At its peak, merchants on Shopify saw sales of $3.5 million per minute at 12:01 PM EST on Black Friday, collectively. See more from Benzinga Biogen's Potential Early Alzheimer's Treatment Sees Second Death Linked To It, Shares Fall Axsome Therapeutics Investigational Drug Lowers Risk Of Agitation Relapse In Alzheimer's Patients Don't miss real-time alerts on your stocks - join Benzinga Pro for free! Try the tool that will help you invest smarter, faster, and better. © 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

AMZN

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Amazon To Close Down More Indian Operations As Slowdown And Competition Pinches

Amazon.Com, Inc (NASDAQ: AMZN) looked to exit India's meal deliveries and a service providing bulk doorstep deliveries of packaged consumer goods to small businesses, Bloomberg reports. The exits will involve layoffs of just several hundred out of a workforce of thousands, leaving Amazon relying on its core offerings like online retail in the country. CEO Andy Jassy's cost-reduction campaign came amid slowing growth in several areas of Amazon's business. Also Read: Black Friday Surprise: Walmart

Yahoo

Amazon To Close Down More Indian Operations As Slowdown And Competition Pinches Amazon.Com, Inc (NASDAQ: AMZN) looked to exit India's meal deliveries and a service providing bulk doorstep deliveries of packaged consumer goods to small businesses, Bloomberg reports. The exits will involve layoffs of just several hundred out of a workforce of thousands, leaving Amazon relying on its core offerings like online retail in the country. CEO Andy Jassy's cost-reduction campaign came amid slowing growth in several areas of Amazon's business. Also Read: Black Friday Surprise: Walmart Beats Amazon In Online Searches For Deals Amazon has struggled in one of the world's fastest-growing e-commerce markets, where it faced regulatory heat and competition from homegrown conglomerates Reliance Industries Ltd. and Tata Group, and Walmart Inc's (NYSE: WMT) Flipkart. Despite plowing billions of dollars in everything from grocery delivery to payments in India during the past decade, Amazon failed to achieve the dominance it enjoys in markets such as the U.S. Several projects in beta testing are also likely to be shelved. Amazon Academy's learning platform will shut down in the coming months. Job losses in the country are likely in the low hundreds or just a fraction of Amazon's India e-commerce workforce of over 10,000. Amazon attracted the outrage of a labor union assembling tech workers for making what it calls "voluntary separation" offers and giving employees limited time until December 6 to decide. Amazon plans to cut about 10,000 jobs, it's most significant ever headcount reduction globally. Amazon launched Amazon Food, the meal delivery service it's now shuttering, in India in 2020. Amazon's business-customer unit will continue to provide small retailers and bulk buyers with goods such as groceries and medical supplies. Still, it will no longer offer door delivery of packaged consumer goods. Price Action: AMZN shares closed lower by 0.76% at $93.41 on Friday. See more from Benzinga Black Friday Surprise: Walmart Beats Amazon In Online Searches For Deals Amazon of Africa, Jumia Technologies Undergoes Tough Restructuring To Boost Bottomline Don't miss real-time alerts on your stocks - join Benzinga Pro for free! Try the tool that will help you invest smarter, faster, and better. © 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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U.S. Navy awards Amazon Web Services contract worth over $700 million

The United States Navy on Monday awarded Amazon.com Inc's cloud computing division a five-year enterprise software license contract worth $723.9 million.

Reuters

U.S. Navy awards Amazon Web Services contract worth over $700 mln Dec 19 (Reuters) - The United States Navy on Monday awarded Amazon.com Inc's (AMZN.O) cloud computing division a five-year enterprise software license contract worth $723.9 million. The deal will provide the Navy with access to Amazon Web Services' (AWS) commercial cloud environment, Professional Services and its training and certification courses. Earlier this month, the Pentagon awarded cloud computing contracts worth $9 billion to Alphabet Inc's (GOOGL.O) Google, AWS, Microsoft Corp (MSFT.O) and Oracle Corp (ORCL.N) as part of the Joint Warfighting Cloud Capability contract. The Pentagon said work will be performed for a maximum of five years from December this year through 2028. Our Standards: The Thomson Reuters Trust Principles.

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Streaming platforms, media companies weigh M&A opportunities heading into 2023

Yahoo Finance entertainment reporter Allie Canal details the various M&A opportunities in the media industry going into 2023.

Yahoo

Streaming platforms, media companies weigh M&A opportunities heading into 2023 Yahoo Finance entertainment reporter Allie Canal details the various M&A opportunities in the media industry going into 2023. Video Transcript DAVE BRIGGS: Media companies are no longer going all in on content. According to the research firm Ampere Analysis, TV networks and streaming companies are buying far fewer adult scripted series, down 24% for the second half of the year. Yahoo Finance reporter Allie Canal is here with what's next for the industry as a whole. Allie, where are we headed? ALEXANDRA CANAL: Yeah, where we're heading, it's going to be interesting to see what happens in 2023 because 2022 was a much slower year for media M&A. That's due to a variety of reasons, one being the fact that the Fed hiked interest rates seven times so far this year. That's automatically going to pressure dealmaking. We did see the closing of some pretty big deals like Warner Brothers Discovery, Amazon's acquisition of MGM. But moving ahead into 2023, there is this expectation that, although there will be less, there is certainly going to be a lot of activity. I spoke with a few experts. There's also a new report out from PwC, and they really elaborated on what's going to drive media M&A, one being sports rights and sports-adjacent industries like sports gambling. The issue there, though, is that sports rights are very competitively priced, and a lot of these media giants, they are pulling back spending. Wall Street wants to make sure that you're profitable. They're not spending nearly as much as they did in years past. So that's going to be an interesting story to watch in 2023. Some other things, other types of media M&A could include video games. That proven intellectual property going a long way there. Also repurposed theaters. Could a streaming giant potentially buy a theater chain? That's something that could be possible. And we've heard from these prominent media executives-- Paramount CEO Bob Bakish, Jason Kilar, former head of WarnerMedia-- they all agree that consolidation is happening. The question is the timeline, and Kilar hinted that that timeline is pretty quick. He said in two years, we're really going to have three major players. So it's something that we're going to have to watch. We've heard rumblings that potentially Warner Brothers Discovery could sell itself again or perhaps sell more parts of itself. We also have some of those smaller players like WWE, Chicken Soup for the Soul. Maybe some of the bigger players will gobble them up. And then with Disney, ESPN. Do you spin it off? Do you sell Hulu to Comcast? So I do think Wall Street is going to be on these companies' tails. You want to be profitable. M&A one of the more practical ways to get there, and a lot of question marks for a lot of these media companies. DAVE BRIGGS: Everybody kind of standing around looking for a dance partner in that awkward - ALEXANDRA CANAL: Exactly. DAVE BRIGGS: --moment in time. Allie Canal, good stuff. Thank you.

AMZN

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Integral Ad Science: Decent Upside If Valuation Gap Closes Vs. Peer

Integral Ad Science Holding Corp. provides ad verification solutions. Read why I think IAS stock is undervalued.

SeekingAlpha

Integral Ad Science: Decent Upside If Valuation Gap Closes Vs. Peer Summary - Significant growth opportunities exist in the digital advertising industry. - Integral Ad Science Holding Corp. provides businesses with an ad verification solution. - Integral Ad Science Holding Corp. is a market leader in its field, with key stakeholder relationships that lend credibility to its capabilities. Overview I believe Integral Ad Science Holding Corp. (NASDAQ:IAS) is undervalued by at least 35%. I expect the demand for IAS product to continue growing in the coming years due to several factors, including the increase of ad fraud, the emphasis on brand reputation management, and the rapid growth of programmatic advertising. To this end, IAS offers a solution to companies to help them get the most return on investment by verifying the legitimacy of their ads and making sure they reach their intended audience in a trustworthy setting. Business description IAS provides third-party verification and measurement of digital advertising across various end-channels such as desktop, mobile, connected TV [CTV], and more. Significant growth opportunities in the digital advertising industry In my opinion, IAS is set up to take advantage of several noteworthy developments in digital advertising and changes in consumer preferences. According to Statista, the total amount of time people spend online has more than doubled in the last decade. Not only that, but forecasts show that investments in digital advertising will keep growing through 2024. I expect advertising budgets for all forms of digital media to keep growing as consumers spend more time online. Three major developments that contribute to this trend are the decline of ad fraud, the emphasis on brand reputation management, and the rapid growth of programmatic advertising. Ad fraud is estimated to cost $100 billion by 2023, and marketing companies are becoming acutely aware of the wasted media spend as a result. Marketing companies rely on customer feedback and data gathered to develop their marketing strategies. Hence, given the growing importance of accurate data in today's increasingly digital world, it is crucial to improve data accuracy. Particularly as more advertisements adopt a personalized approach, which depends on accurate data. Also, many 21st-century marketers put a premium on maintaining a positive image for their brands. There has been a recent shift toward brands caring more about aligning their advertising with content that reflects their values and goals. Marketers are taking measures to protect their brands and boost their campaigns' effectiveness by implementing brand safety solutions that are both flexible and scalable. Ad exchanges that use automated systems to buy and sell digital ads, known as programmatic advertising, are gaining traction. Using real-time signals, programmatic advertising has helped boost growth in recent years by aiding marketing companies in improving performance and pricing. In my opinion, programmatic advertising will continue to expand rapidly because it enables businesses to more precisely target the highest-value inventory in real time. IAS offers an ad verification solution to companies Customers can get the most return on investment by checking the legitimacy of their ads and making sure they reach their intended demographic in a trustworthy setting. To this end, IAS equips its customers with the resources (such as analytics) necessary to enhance media quality and the efficacy of their campaigns. Moreover, IAS prevents open web fraud and brand-unsafe inventory in real - time basis. What's more, with IAS, clients can direct their programmatic budgets toward the highest-quality inventory, and either aim or forgo content based on their own preferences and preferences, as determined in real time by signals from DSPs. The foundation of IAS's value proposition is IAS Quality Impressions, a proprietary metric that ensures digital content quality standards for advertising effectiveness, according to IAS S-1. Quality Impressions refer to the number of times an online ad is shown to a real person rather than a bot, in the correct location on the screen, and in an environment that is fitting for the advertiser's brand. IAS' contextual capability also aids brands in avoiding and targeting content according to predetermined guidelines or campaign objectives. In addition, the technology will be used to classify content based on how it makes people feel on a global scale. Because of IAS, publishers can earn more money from their ad space, which is a win-win situation all around. Global customer base provides rich amount of data which drives insights IAS has thousands of satisfied clients, the vast majority of which are in the advertising and, to a lesser extent, publishing industries. In my opinion, IAS's ability to gain an edge over competitors is due in large part to the variety of clients the company has worked with in the past. As I've already mentioned, accurate underlying data is crucial in the realm of digital advertising, and this is where IAS shines. They gather trillions of data events every month, providing a full picture of all digital advertising transactions. Customers can use this data set in conjunction with IAS's machine learning capabilities to gain actionable insights into the performance of their marketing in real - time basis. Think of it as a flywheel effect: as the number of customers grows, so does the amount of data collected, allowing for more insightful analysis and, ultimately, better service. If I'm right and IAS keeps expanding, it will be able to keep its edge in the market. A market leader IAS provides important research studies and academic papers in addition to its participation in professional conferences and the hosting of proprietary events. In my opinion, these works showcase IAS's leadership in the industry by disclosing novel inferences drawn from countless data events. Ad buyers and sellers can use IAS's monthly global measurements as a benchmark for the efficacy of their advertising and inventory. IAS continually amplifies and shares these thought leadership initiatives through lead generation, content creation, and corporate communications, to help ensure that IAS solutions inspire confidence to customers. Key relationships with stakeholders lend credence to IAS capabilities IAS has grown steadily over the years to become a reliable partner for many of the reputable advertising platforms, enabling them to keep better tabs on and account for their ad spending. My impression is that this speaks highly of the quality and reputation of IAS in the industry. The majority of digital advertising budgets are controlled by companies like Google (GOOGL), Meta Platforms/Facebook (META), and Amazon (AMZN), all of which integrate IAS solutions to deliver the necessary verifications required by the customers IAS serves. The credibility of IAS product capabilities is further strengthened by the company's close collaboration with industry institutions and accreditation groups. IAS, for instance, has received viewability accreditation from the American Broadcasting Companies [ABC], as well as proprietary metric accreditation from the Media Ratings Council [MRC]. To keep its MRC certifications current, IAS also submits to annual audits by an external auditor to check that all of its products are in keeping with MRC requirements. Targeting the top global advertisers and international markets In my opinion, IAS can gain even more traction by forming partnerships with the world's leading advertisers and focusing on high-spending niches and brands that have an innate sensitivity to issues of brand safety, appropriateness, and return on ad spend. The global marketing industry is expanding into new vertical markets and investing in more advanced verification strategies. In my opinion, there is growing interest in IAS's solutions all over the world, but especially in Latin America and Asia Pacific, where the company makes only 37% of its total revenue. I believe IAS can increase its market share by working more closely with the most popular social media platforms, refining their programmatic solutions, and, most importantly, capitalizing on the scalability of the competitive advantage it has built on the strength of its rich data set. I also think that IAS can grow its addressable market beyond core validation and viewability through the addition of new capabilities like ad targeting and new channels like CTV. Forecast According to my investment thesis, IAS can maintain a healthy growth rate in the near term, albeit with a growth slowdown in 2023 due to the recession, eventually reaching $555 million in revenue in FY24. This is because I believe the total addressable market ("TAM") is massive and that IAS can continue to reinvest in its business (new verticals, new products, etc.) to increase growth. Because the company is currently losing money as a result of reinvestment, it should be valued using forward revenue. To value IAS, I illustrated two different scenarios based on two valuation multiples (which trades at 3x forward revenue today). - I assumed IAS would trade at the same valuation today. - I assumed IAS would trade at the same level as its peer (DoubleVerify Holdings, Inc. (DV)) at 6x forward revenue - I believe this is possible given that both are of similar size and growing in a similar range. Key risks Product quality Marketers use IAS to verify and rate the quality of media. As a result, it is critical that IAS provide precise reporting on marketing campaigns. Without this, I am concerned that customers will lose trust in IAS if they believe the ROI is low, which could lead to a major problem. Data fidelity There are risks involved in gathering, using, storing, and discarding sensitive data. Companies like IAS have accumulated vast amounts of user data that, if leaked, could be used maliciously. Because of this, protecting sensitive information is an absolute necessity. Conclusion Integral Ad Science Holding Corp. is, in my opinion, undervalued by at least 35%. Several factors, such as the rise of ad fraud, the importance of brand reputation management, and the meteoric rise of programmatic advertising, have me convinced that demand for Integral Ad Science Holding Corp. products will only increase in the years to come. This article was written by Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (2)

AMZN

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Why Amazon.com Stock Is Still Falling

A Wall Street analyst warns that things could get even worse for the e-commerce and cloud giant next year.

Yahoo

Why Amazon.com Stock Is Still Falling A Wall Street analyst warns that things could get even worse for the e-commerce and cloud giant next year. A Wall Street analyst warns that things could get even worse for the e-commerce and cloud giant next year.

AMZN

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Amazon loans $16M to Gilbane for Hyattsville apartments

It is the e-commerce company's latest investment in local affordable housing next to a Metro station.

Yahoo

Amazon loans $16M to Gilbane for Hyattsville apartments It is the e-commerce company's latest investment in local affordable housing next to a Metro station. It is the e-commerce company's latest investment in local affordable housing next to a Metro station.

AMZN

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Amazon: How To Cushion Your Blow

Covered calls arguably have no downside, but the only flip side is capping your gains early. Click here to read how to utilize this strategy with Amazon stock.

SeekingAlpha

Amazon: How To Cushion Your Blow Summary - Covered calls arguably have no downside. - The only flip side is capping your gains early. - Amazon's stock split makes these strategies possible for retail investors. - Technical indicators and short-term momentum being down favor covered calls. Amazon (NASDAQ:AMZN) is undergoing a shift in market sentiment. Okay, that could challenge being the understatement of the year. With the stock down nearly 50% and the Fed's hawkish stance last week (despite better inflation readings), things don't appear all that bright in the short to medium term. With Amazon far away from paying dividends, is there anything that could cushion our blows? Enter Covered Calls. To explain Covered Calls using an elevator pitch, when using covered calls, you are agreeing to: - sell shares (at least 100) in a stock that you own already - sell at a future date you pick - sell at a price you pick - get paid a premium for doing so Not bad. This is where Amazon's recent stock split comes in very handy for retail investors. I mean, how many of us would have had 100 shares of Amazon at the current pre-split level of $1,740? Not many. But the number of retail investors owning 100 shares of Amazon at the post-split price of $87 will be significantly higher. Covered calls tend to work better when executed on green days in down-trending markets. We are obviously in a choppy but still down-trending market. So, the trick is essentially to sell the covered call on a day the stock in question is in green as the strike price will be closer, netting a higher premium. Although Amazon closed down on Friday, I am picking the chain above for illustration. The key items to note (highlighted in green and red boxes) are: - We are selling a covered call on Amazon. - Strike Price: $100. - Expiration Date: January 20th, 2023 (Amazon is expected to report earnings on January 31st, 2023 according to Seeking Alpha. So, earnings-related volatility should not impact this trade much). - Premium: About 80 cents per share. That means for each 100 shares of Amazon you are selling a covered call on, you get $80 in return. Let us look at the returns and possible scenarios. - If Amazon remains flat or below $100: The premium of about 80 cents per share represents a return of ~1% on the underlying share price of $87. Before you scoff at it, keep in mind this return is for less than a month, and repeating this over 12 months will net a nice annualized return. - If Amazon goes above $100: The covered call writer will be forced to give up the shares in this case. This may not be too bad considering that Amazon is currently trading at $87 and selling at $100 represents a 15% return in a month. Adding the 1% for the premium, that's a 16% return. The total return in this scenario is $100 + $0.80 - $87 = $13.80 per share, or a healthy 16%. - What if Amazon blasts off?: This is the only flip side of using covered calls. If the underlying stock shoots through your strike price, you will be forced to sell at the strike price, denying yourself any future upside potential. However, the market predicts with an 87% probability that Amazon will be below $100 by January 20th, 2023 as shown by the green box in the image above. In addition, since I am using a monthly chain here (option expires in about a month from now), short-term technical indicators are of paramount importance. As shown in the chart below, Amazon is still heavily in downtrend. With no earnings report before expiration, a nearly 15% move within one month seems unlikely given this downtrend. - Just in case you get called away (meaning, forced to sell 100 shares at $100), you can always sell a cash-secured put to put yourself in a position to acquire Amazon at a lower strike price. Fundamental Outlook There is no doubt that things look bleak for the stock in the short term, but from a long-term fundamental perspective, Amazon is far from a finished story. - An AWS spin-off always remains an enticing possibility, with valuations for the stand-alone company ranging from $600 Billion to more than a Trillion. AWS is still growing at more than 30%, despite headlines about "slowing" growth. The growth rate slowing down and competition catching up (or at least taking some share) are both offset by the fact that even the base-scenario Total Addressable Market ("TAM") is still 10 folds away. - Advertising is getting bigger by the day as covered in this article and is setting up nicely for further growth a cord-cutting is still a trend and there are not too many powerful online mediums to advertise outside of the mega caps. - Despite recent troubles, analysts still have a median price target of $135, which represents a hefty 55% return from here. No wonder, Amazon is repeatedly making it into 2023 short-lists for a turn-around as covered here and here on Seeking Alpha. - Lastly, Seeking Alpha's quant ratings show that Amazon is going in the right direction in the three key factors shown below: valuation, profitability, and revisions. Valuation has always been a problem with Amazon (partly due to their inclination to invest profits into the next growth avenue). Recent earnings revisions have also been a problem, with people getting more pessimistic. Both these factors are now turning a corner as highlighted below. Growth and Profitability remain strong, while momentum is clearly down, which makes your covered calls less risky. Conclusion There are no free meals in the world of investing. However, selling covered calls comes closest with pretty much no downside. You can have your cake and eat it too, although this applies even more to dividend-paying stocks. However, using the strategy above, you just created your own dividend from Amazon, a non-dividend-paying stock. If you dearly want to hold onto your shares, picking a farther strike price and settling for a lower premium is your best bet. If you don't mind risking some, if not all, your shares getting called away, a closer strike price gets you a higher premium, which cushions your short-term blows further. This article was written by Analyst’s Disclosure: I/we have a beneficial long position in the shares of AMZN either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (224) What is just as much a shame, is rolling for a loss, when you can roll for a net credit. A really prudent risk-managing investor would have rolled for net credit, by going out to a farther expiration, far enough to find a net credit. By the way, AMZN didn't reach $100. It had an inter-day high of $99.32 on Wed. 1/18. Moot point though. I would have rolled the $100 strike to the 1/27 expiration, to earn a decent premium. As you go to a farther expiration, the yield on risk goes down, and bid-ask spreads widen. This is a basic truth for all option players. Sell and Hold players minimize this slippage by making fewer transactions.My approach was to sell options 6-8 months out, with a minimal criteria of 13% annualized yield on risk. I would set limit orders usually at or above the ask, and wait. Often I sold the first contract to be sold when a new expiration series was added. I did not feel that I could improve my returns with additional trading, that if I tried I would get whipsawed as often as not.Provided sufficient data we should be able to retire the entire Buy and Hold Shares, Sell and Hold Options, and Sell and Roll Options debate, if we are all willing to include randomization of historic data in our analysis. "As you go to a farther expiration, the yield on risk goes down, and bid-ask spreads widen." "My approach was to sell options 6-8 months out," Maybe you could reconcile these two statements, because it appears as if you are purposely lowering your yield on risk, by going out 6-8 months. There is more to consider than just slippage and whipsaw. Are you aware of PPD, Profit Per Day? When deciding which expiration date to choose from, considering PPD allows you to compare apples to apples. Here is a copy of a post I made in February 2021. PPD = Profit per day When you look at an option chain to decide which strike and which expiration date to choose, all you see is the bid price per share. It is easy to be tricked into believing that monthly or longer options are more profitable, because they LOOK larger than weekly premiums. No one ever taught you, (up till now, thank me later) to consider the PPD, Profit per day. PPD is the premium you collect, divided by the number of days until expiration. I looked up the option chain for AAPL, on 02/11/21’s opening prices. Let’s say for illustration that you bought AAPL at $130.00 and you are looking to SELL a covered call with a strike of $136.00, and want to choose the best expiration date, that makes you the most money. This will be an eye opener, and change how you look at expiration dates from now on.STO AAPL 02/12/21 136 CALL, BID $55.00 Divided by 2 dte = $27.50 PPD $27.50 divided by $13,000 = .02115% X 365 = a 77% annual ROI STO AAPL 02/19/21 136 CALL, BID $166.00 Divided by 9 dte = $18.44 PPD $18.44 divided by $13,000 = .14184% X 365 = a 52% annual ROI STO AAPL 03/12/21 136 CALL, BID $425.00 Divided by 30 dte = $14.17 PPD $14.17 divided by $13,000 = .10897% X 365 = a 40% annual ROI * For you who like monthly options.STO AAPL 04/01/21 136 CALL, BID $550.00 Divided by 50 dte = $11.00 PPD $11.00 divided by $13,000 = .08462% X 365 = a 31% annual ROI. Notice how the longer the days till expiration, the lower the amount you actually earn, per day. LEAPS options are the cheapest per day. Mind blown. So, do you want a 5 day weekly (open position on Monday, expires on Friday) option that would be around a 60% annualized ROI? OR, a 9 day option and earn only a 52% ROI? OR, a 30 day option and earn only a 40% ROI? OR, a 50 day option and earn only a 31% ROI? One weekly option, for four weeks in a row, will earn 50% more premium, than selling one monthly option. Plus, you get the flexibility of adjusting the strike price every week, as the underlying’s market price changes. Knowledge IS power, ONLY if you apply that knowledge.PS: The farther out in expiration you go, the less yield on risk. I know this is antidotal, but from personal experience, I believe the shorter term expirations I use, earns enough extra premium, to make up for any whipsaw or loss from bid/ask spread when trading more often. More time in the market=more risk. Which trade has the greater chance of going in the money by expiration? AMZN, $90 put strike with the 183 day, 7/21 expiration? Mid price bid $6.63 which has an annualized ROI of 14.7%. Delta of .31 or AMZN, $91 put strike with the 8 day, 1/27 expiration? Mid price bid $0.31 which has an annualized ROI of 15.5%. Delta of .08 If you used the same Delta of .31 on the 1/27 expiration that you would use on the 6 month expiration, it would be the $95 strike with a Mid price bid of $1.07, a 51% annualized ROI. $107 x 26 weeks = $2,782I know this is theoretical, but the one trade with the 7/21 expiration that pays $663, while the 8 day expiration, rolled every Friday for 26 weeks, pays approximately $806. That is a 21% increase in total premium. You also have the added benefit of adjusting the strike price each week to fit the market changes. Something to think about. I was in the same situation a few years ago. Rather than diversifying wide, I started concentrated on one stock at a time, until I had 100 shares, in one stock, starting with the lowest priced stock in my portfolio. Once I had 100 shares, I started selling OTM covered calls to start earning large premiums. (Large as compared to dividends). Then I started accelerated accumulation of the next cheapest stock I had, until it had 100 shares. At that point, I had two stocks with 100 shares each, and 2 covered calls earning premium. Then 100 shares on three stocks, earning premium on three covered calls. Rinse and repeat, until ALL of your stocks have 100 shares each, earning covered call premium on ALL your stocks. This greatly accelerates the accumulation until ALL my stocks had 100 shares, earning premium, from selling covered calls. Compare that accelerated growth, to the traditional strategy of buying equal weight on each stock. It could take years for someone to buy a few shares each month, on each stock, until they reach 100 shares. I hope you found this useful. instead they are up YTD composite. They are a good value and have good growth ahead, better than AMZN by a mile.

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Amazon stock gives up last of its pandemic gains after almost 50% slump in 2022

Amazon shares have been battered this year by a broader market selloff tied to soaring inflation, a worsening economy, and rising interest rates.

CNBC

- Amazon shares have given up all of their gains from the pandemic. - The company's stock skyrocketed in 2020 and held up in 2021 as shoppers flocked to the e-retailer for goods. - Like the rest of Big Tech, Amazon has been battered this year by a broader market sell-off tied to soaring inflation, a worsening economy and rising interest rates. Amazon's stock price has lost all of its pandemic-fueled gains, falling back to where it was trading when Covid-19 started shutting down the U.S. economy. On Monday, the e-retailer's shares dropped 3.4% to $84.92, the lowest close since March 16, 2020. Amazon has fallen sharply this year amid a broader tech sell-off tied to soaring inflation, a worsening economy and rising interest rates. For the first time in nearly two decades, the tech-heavy Nasdaq Composite is set to lose to the S&P 500 in consecutive years. Trillions of dollars have been wiped from tech stocks. Shares of Amazon have tumbled 49% in 2022 and are on pace for their worst year since the dot-com crash of 2000, when the company lost 80% of its value. Among the highest-valued tech companies, Meta has had the worst year, down 66%, followed by Tesla at 57% and then Amazon. It's a marked reversal from 2020, when Amazon stock rallied amid unprecedented online demand. Amazon saw a rush of orders from consumers at the height of the pandemic, as many avoided trips to physical stores and turned to the web for essential and nonessential goods. Last year, the story began to change, as e-commerce companies reckoned with tough year-over-year comparisons and the economy started to reopen, leading many people to return to physical stores. By early 2022, higher costs tied to inflation, supply chain constraints and the war in Ukraine generated further pressure on Amazon and other tech companies. For Amazon, the challenges go deeper. It's also contending with slowing growth in its core retail business, and the company has been forced to scale back after its historic expansion during the pandemic. CEO Andy Jassy has embarked on a wide-ranging review of the company's expenses, resulting in some programs being shuttered and a hiring freeze across its corporate workforce. Last month, the company began laying off thousands of employees as part of a wave of job cuts that are expected to extend into next year. The pain isn't likely to let up soon. Amazon spooked investors in October when it projected sales between $140 billion and $148 billion for the current quarter, representing growth of just 2% to 8%. That was far below analysts' average forecast of $155.15 billion, according to Refinitiv. WATCH: Amazon CEO Andy Jassy on shifting consumer spending habits

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Snap won't make money until 2027, analyst says

"We don't think Snap is due to generate any earnings until 2027," Jefferies analyst James Heaney warned on Yahoo Finance Live (video above).

Yahoo

Snap won't make money until 2027, analyst says Snap may not turn a profit until the lead-up to the 2028 presidential election, according to one analyst. "We don't think Snap is due to generate any earnings until 2027," Jefferies analyst James Heaney warned on Yahoo Finance Live (video above). Heaney downgraded Jefferies' rating on Snap a week ago to Hold from Buy, citing overly optimistic estimates on ad sales amid a challenging 2023 economic outlook. "Our base case now is that 2027 is when they turn a profit, and that is based on a more recessionary environment," Heaney added. "So I think the Street is a little bit more optimistic in terms of when Snap can become a profitable company." The Street expects Snap to turn a net profit in 2023 to the tune of $222 million. But to Heaney's point, the estimates could prove too bold. For the nine-months ended Sept. 30, Snap had a net loss of $1.1 billion. A year ago at that time, Snap's net loss tallied about $510 million. And despite cutting 20% of its workforce earlier this year in an effort to reach profitability, the company notched a lackluster third quarter. Snap continued to blame an advertising slowdown and Apple's privacy changes for its missteps in execution while also warning that sales trends in the fourth quarter would get worse. Snap's stock has crashed 82% so far in 2022 amid continued disappointing financial showings. "We believe it highly likely that tougher market conditions are leading to a consolidation of ad spend with the largest platforms (Google and Facebook) and to those platforms that provide on-platform and highly measurable conversions (Google again and Amazon and a few other places)," Evercore ISI analyst Mark Mahaney wrote in a recent note. "And we think it likely that the recent major personnel changes at SNAP – the loss of key ad execs to Netflix – has exacerbated the headwinds." Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn. Click here for the latest trending stock tickers of the Yahoo Finance platform Click here for the latest stock market news and in-depth analysis, including events that move stocks Read the latest financial and business news from Yahoo Finance Download the Yahoo Finance app for Apple or Android Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, LinkedIn, and YouTube

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Will Workers Strike Affect Amazon's (AMZN) Holiday Prospects?

Amazon (AMZN) faces hurdles during the peak shopping season in the form of a workers' strike in Germany.

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Will Workers Strike Affect Amazon's (AMZN) Holiday Prospects? Amazon AMZN is likely to face challenges during the peak shopping hours of this holiday season in the form of a workers’ strike in Germany in the coming days. Reportedly, the German labor union Verdi has asked the workers at Amazon’s seven German distribution centers to join the rolling strikes that would take place at alternate locations as a protest against poor pay hikes. The union is of the opinion that the inflation factor has not been considered in the pay hikes for the workers. Verdi has come up with the idea of alternating strikes this time, which would not give Amazon much time to prepare for the work stoppages. Amazon.com, Inc. Price and Consensus Amazon.com, Inc. price-consensus-chart | Amazon.com, Inc. Quote Disruption at Amazon The workers’ strike at the time of Christmas – the busiest shopping period, for an online retailer is a matter of grave concern. This is likely to affect the e-commerce giant’s pre-Christmas business. Hence, such a broad strike by Amazon employees in Germany, the company’s second-largest market, is expected to jeopardize its holiday season prospects. We note that the shipment and fulfillment centers aid AMZN in storing and shipping products and handling returns quickly. These are crucial for Amazon for providing a better shopping experience to its customers. Consequently, the strike might impact Amazon’s holiday sales negatively. This might make investors more apprehensive about the stock. AMZN has lost 47.3% on a year-to-date basis compared with the industry’s decline of 41.8%. Amazon’s Stance As per the past opinions given by Amazon, the workers are availing of safe, secured and favorable working conditions along with good career opportunities, robust benefits and excellent pay. Additionally, Amazon’s strong strategies are primarily focused on providing an enhanced shopping experience with the help of its robust product offerings, deep discounts on various items, Prime program, expanding freight and fast delivery services. Further, Amazon’s automation drive-through robots in its fulfillment centers are on a high and remain major positives. These strategic endeavors are likely to continue driving its sales this season in many countries like the United States, the U.K., Canada and Australia, to name a few. Zacks Rank & Stocks to Consider Currently, Amazon carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the retail-wholesale sector are Ross Stores ROST, Rush Enterprises RUSHA and Expedia Group EXPE. While Ross Stores and Rush Enterprises sport a Zacks Rank #1 (Strong Buy), Expedia carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. Ross Stores has lost 0.2% on a year-to-date basis. The long-term earnings growth rate for the ROST stock is currently projected at 10.5%. Rush Enterprises has lost 10.2% on a year-to-date basis. The long-term earnings growth rate for the RUSHA stock is currently projected at 15%. Expedia has lost 51.2% on a year-to-date basis. The long-term earnings growth rate for the EXPE stock is currently projected at 14%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Expedia Group, Inc. (EXPE) : Free Stock Analysis Report Ross Stores, Inc. (ROST) : Free Stock Analysis Report Rush Enterprises, Inc. (RUSHA) : Free Stock Analysis Report To read this article on Zacks.com click here.

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Amazon and Microsoft are backing this battery-powered generator startup

California-based startup Moxion Power is building high-powered, mobile energy storage technology that can be used pretty much anywhere. 

CNBC

Diesel generators are staples at construction sites, movie sets, or anywhere portable power is needed. But they are dirty, emitting carbon dioxide as any other fuel-burning engine does. While big legacy companies like Generac and Caterpillar are beginning to offer small battery-powered units in addition to their larger diesel generator lines, California-based startup Moxion Power is focused entirely on this new power frontier. It is building high-powered, mobile energy storage technology that can be used pretty much anywhere. "We design, engineer and manufacture all of the core technologies that we use. So we're not buying someone else's battery module. We are actually manufacturing battery modules in house," said Paul Huelskamp, CEO of Moxion. Huelskamp says diesel generators are notoriously difficult and expensive to maintain and burn diesel fuel very inefficiently. "And so that's extremely wasteful and terrible for the environment," he added. Under Moxion's model, clients can either buy the units or rent them. For rentals, Moxion uses technology that alerts them when the batteries are running out, so they can replace them with no lapse. They claim to know exactly what the state of charge is. For companies looking to buy, the generators are competitive in price, and may in fact end up cheaper because they are less expensive to maintain than diesel models, says Huelskamp. Amazon is both investing in the company and currently leasing Moxion units for two video productions, a movie and a series. The generators will power cameras, base camps, lighting, hair and makeup trailers, and other production equipment. "One of the beauties of Moxion's unit is it is dead quiet, and zero-emission," said Nick Ellis, principal at the Amazon Climate Pledge Fund. Roughly half of the carbon emissions from the average movie come from the fuel used to power generators and transportation. "It can be moved indoors for unique shots indoors that previously we couldn't do, and they really allow our team to think about new ways of filming productions than they used to," said Ellis. "The other real benefit here is because you can hook up these units really close to the set, you eliminate a lot of the cabling that's a trip and danger for your production teams. And so suddenly, these units are sitting right there quietly operating with zero emissions, and taking up a very small footprint on the production set." In addition to the Amazon Climate Pledge fund, Moxion's backers include the Microsoft Climate Innovation Fund, Enterprise Holdings, Energy Impact Partners, Tamarack Global and Sunbelt Rentals. Total funding so far: $110 million.

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Amazon, Down Almost 50% This Year, Is the Top Big Tech Stock to Buy for 2023

In 2021, it seemed like nothing could stop the upward trajectory of big technology stocks like Amazon (NASDAQ: AMZN). The economy was booming as COVID-19 vaccines allowed pandemic-driven social distancing measures to be relaxed, and the digital advertising market hit new heights, leaving investors optimistic about internet stocks. High inflation, rising interest rates, and geopolitical turmoil have turned investors from extreme optimists to pessimists -- particularly when it comes to technology stocks like Amazon, which has steadily fallen 48% year to date.

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Amazon, Down Almost 50% This Year, Is the Top Big Tech Stock to Buy for 2023 In 2021, it seemed like nothing could stop the upward trajectory of big technology stocks like Amazon (NASDAQ: AMZN). The economy was booming as COVID-19 vaccines allowed pandemic-driven social distancing measures to be relaxed, and the digital advertising market hit new heights, leaving investors optimistic about internet stocks. High inflation, rising interest rates, and geopolitical turmoil have turned investors from extreme optimists to pessimists -- particularly when it comes to technology stocks like Amazon, which has steadily fallen 48% year to date.

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Elon Musk's Latest 'Twitter Files' Show Internal Angst Over FBI Requests, L3Harris Scoops Up Aerojet, Mesa Air End Regional Flights For American Airlines: Today's Top Stories

Benzinga Elon Musk Drops Latest Supplement To 'Twitter Files' Showing Internal Angst Over FBI Requests Elon Musk has shared the latest supplement of the so-called "Twitter Files" with his followers on the platform. The Twitter CEO said, "Elvis is in the building," while retweeting the supplement shared by journalist Matt Taibbi on Sunday. Elvis is a reference to U.S. Federal Bureau of Investigation agent Elvis Chan. The official interacted with Twitter's former head of trust and safety, Yoel Rot

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Elon Musk's Latest 'Twitter Files' Show Internal Angst Over FBI Requests, L3Harris Scoops Up Aerojet, Mesa Air End Regional Flights For American Airlines: Today's Top Stories Benzinga Elon Musk Drops Latest Supplement To 'Twitter Files' Showing Internal Angst Over FBI Requests Elon Musk has shared the latest supplement of the so-called "Twitter Files" with his followers on the platform. The Twitter CEO said, "Elvis is in the building," while retweeting the supplement shared by journalist Matt Taibbi on Sunday. Elvis is a reference to U.S. Federal Bureau of Investigation agent Elvis Chan. The official interacted with Twitter's former head of trust and safety, Yoel Roth. L3Harris Technologies Acquires Aerojet Rocketdyne For $4.7B L3Harris Technologies Inc (NYSE: LHX) has agreed to acquire Aerojet Rocketdyne Holdings Inc (NYSE: AJRD) for $58 per share in an all-cash transaction valued at $4.7 billion, including debt. The deal marks L3Harris' second acquisition announcement of 2022. Jim Farley Spells Out No. 1 Priority For Ford — No, It's Not Electric Vehicles Ford Motor Company (NYSE: F) CEO Jim Farley reportedly delved into his first priority at the company in a recent meeting with retired engineers. Fixing quality is Farley's top priority, the Ford CEO said in a speech with the 'Ford Retired Engineering Executives' group. "It is the most important initiative in the whole company. And it's going to take several years. We didn't lose it in just one or two years," Farley said, adding, "Until we fix quality, nothing else matters." US Watchdog Nudges Amazon Over Laxity In Recording Workhouse Injuries The U.S. Department of Labor called out Amazon.Com, Inc during inspections at six warehouse facilities in five states for failing to record work-related injuries and illnesses precisely. The findings are part of an ongoing investigation. Amazon faced $29,008 in proposed penalties. A Week After Morgan Stanley Layoffs, Goldman Sachs Axes 4,000 Jobs Goldman Sachs Group Inc (NYSE: GS) plans to lay off around 4,000 employees as it struggles to navigate a difficult economic environment, though no final list has been drawn up. As per Semafor, managers have been asked to identify low performers. In a typical year, 2%-5% of Goldman lays off or receives no bonus — "zeroed out" in industry parlance. Reuters Mesa Air To End Regional Flights For American Airlines, Finalizing New Deal With United The CEO of regional airline Mesa Air Group Inc (NASDAQ: MESA) announced an agreement to operate regional carriers for United Airlines Holdings Inc (NASDAQ: UAL). In a company memo, Mesa Air CEO Jonathan Ornstein said that the Arizona-based carrier is "finalizing a new agreement with United Airlines which would transition all CRJ900s currently flying for American Eagle to United Express." Intel's German Ambitions Hits Roadblock Halted Plant Plans Pending Subsidies Intel Corp (NASDAQ: INTC) retreated from its initial plans of opening a chip factory in the eastern German city of Magdeburg in the first half of 2023. Intel sought more public subsidies. The plant is pivotal to the German and European Union's plans to boost resilience via domestic manufacturing post-pandemic and Russia's invasion of Ukraine hampered supply chains. Apple Supplier To Reportedly Face Hefty Taiwan Fine Soon For China Chip Investment Despite Pullout Apple Inc (NASDAQ: AAPL) supplier Hon Hai Precision Manufacturing Company Limited (OTC: HNHPF), popularly known as Foxconn, will reportedly soon be fined by Taiwanese authorities for an unauthorized investment in a Chinese chip maker. Foxconn, a major iPhone maker, said it would sell its stake in embattled Chinese chip conglomerate Tsinghua Unigroup after disclosing the investment in July. LG Energy Solution Plans $3.1B Investment In South Korea Battery Facility LG Energy Solution Ltd is planning to invest 4 trillion won ($3.1 billion) from this year through 2026 for a battery facility. The battery facility will produce batteries for electric vehicles and other goods. The production facility, located in Ochang, South Korea, will also have a Research and Development center and is expected to provide 1,800 jobs. Wall Street Journal In Efforts To Save Costs, Krispy Kreme Plans To Automate Around 18% Of Its Doughnut Production Just a year and a half after its return to the public markets, Krispy Kreme Inc (NASDAQ: DNUT) has reportedly begun testing new technology that would cut back on repetitive labor and expects to automate about 18% of its total doughnut production over the next 18 months. The company expects the investment of so far $6 million to produce $2 million in annual savings. TuSimple Plans To Cut Half Its Workforce TuSimple Holdings Inc (NASDAQ: TSP) reportedly plans to slash at least half of its workforce next week. The company scales back its measure to build and test autonomous truck-driving systems. The proposed jobs cut is expected to affect about 700 employees. Toyota CEO Reserves Doubts Over Solely Zeroing On EV As Industry Remains Largely Tightlipped During a Thailand visit, Toyota Motor Corp (NYSE: TM) President Akio Toyoda said he is among the auto industry's silent majority questioning the exclusive pursuit of electric vehicles. Toyoda saw hybrids as a crucial alternative against costlier EVs with inadequate charging infrastructure. Toyoda also talked about developing zero-emission vehicles powered by hydrogen. Pending clarity, Toyoda found it imprudent to stick to just one option. Ford Settled Several Truck-Rollover Lawsuits Before $1.7B Verdict, Expects To Argue Favoring Super Duty Trucks Ford Motor Company will argue for a new trial in the Georgia truck rollover lawsuit that resulted in a $1.7 billion jury verdict. The case involves the roof strength of older-model Super Duty pickups. Some twenty years back, Ford settled several similar lawsuits alleging that people were killed or seriously injured in heavy-duty truck rollovers in which the roof collapsed. Bloomberg Germany Union Urges Amazon's Warehouse Employees To Stage Protest Against Pay German labor union Verdi urged Amazon.com Inc (NASDAQ: AMZN) warehouse workers to protest across the country during the holiday season, to press the company for higher pay, and to join collective bargaining agreements. Amazon faced increased tension with workers, including complaints of unfair labor practices, employee activism, and union drives at some facilities. There will be walkouts in a total of ten fulfillment centers of Amazon. Meta Loses Crucial Metaverse Pioneer Over Creative Disagreement With Mark Zuckerberg John Carmack gave up his position at Meta Platforms Inc's (NASDAQ: META) virtual reality unit over frustration with its slow progress and strategy clash with founder Mark Zuckerberg. The games industry veteran said in his resignation note that he never felt adequately able to influence Meta's VR endeavor in the right direction. Carmack, 52, joined VR developer Oculus in 2013 before Meta acquired it in 2014. Carmack started at Oculus as chief technology officer, where he most recently was an executive consultant for VR at Meta. Photo: Ljupco Smokovski by Shutterstock and Wikimedia Commons See more from Benzinga In Efforts To Save Costs, Krispy Kreme Plans To Automate Around 18% Of Its Doughnut Production Ford Settled Several Truck-Rollover Lawsuits Before $1.7B Verdict, Expected To Argue Favoring Super Duty Trucks Don't miss real-time alerts on your stocks - join Benzinga Pro for free! Try the tool that will help you invest smarter, faster, and better. © 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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Germany Union Urge Amazon's Warehouse Employees To Stage Protest Against Pay

German labor union Verdi urged Amazon.com Inc (NASDAQ: AMZN) warehouse workers to protest across the country during the holiday season, to press the company for higher pay, and to join collective bargaining agreements. The union kept the timing and location of individual walkouts under wraps. Amazon faced increased tension with workers, including complaints of unfair labor practices, employee activism, and union drives at some facilities, Bloomberg reports. There will be walkouts in a total of t

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Germany Union Urge Amazon's Warehouse Employees To Stage Protest Against Pay German labor union Verdi urged Amazon.com Inc (NASDAQ: AMZN) warehouse workers to protest across the country during the holiday season, to press the company for higher pay, and to join collective bargaining agreements. The union kept the timing and location of individual walkouts under wraps. Amazon faced increased tension with workers, including complaints of unfair labor practices, employee activism, and union drives at some facilities, Bloomberg reports. There will be walkouts in a total of ten fulfillment centers of Amazon in Achim near Bremen, Bad Hersfeld (two locations), Graben near Augsburg, Dortmund, Koblenz, Leipzig, Rheinberg, Werne, and Winsen (Luhe). Verdi sought recognition of the sectoral wage agreements in retail and mail order and the conclusion of a wage agreement on good and healthy work. The walkout is part of the international day of action "Make Amazon Pay," in which trade unions, human rights and environmental organizations, and other initiatives in at least 23 participating countries. In France and the U.S., the trade unions called on their members to walk out. Amazon faced multiple unionization initiatives in its U.S. warehouses over its safety conditions and pay. Amazon recently raised its U.S. average starting pay for front-line staff. Price Action: AMZN shares traded higher by 0.48% at $88.28 in the premarket on the last check Monday. See more from Benzinga US Watchdog Nudges Amazon Over Laxity In Recording Workhouse Injuries Amazon Taps Streaming Boom Via Games Workshop Deal For Warhammer Films Don't miss real-time alerts on your stocks - join Benzinga Pro for free! Try the tool that will help you invest smarter, faster, and better. © 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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US Watchdog Nudges Amazon Over Laxity In Recording Workhouse Injuries

The U.S. Department of Labor called out Amazon.Com, Inc (NASDAQ: AMZN) during inspections at six warehouse facilities in five states for failing to record work-related injuries and illnesses precisely. The findings are part of an ongoing investigation. Amazon faced $29,008 in proposed penalties. Occupational Safety and Health Administration, after a referral from U.S. Attorney’s Office, launched inspections on July 18, 2022, at Amazon locations in Deltona, Florida; Waukegan, Illinois; and New Wi

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US Watchdog Nudges Amazon Over Laxity In Recording Workhouse Injuries The U.S. Department of Labor called out Amazon.Com, Inc (NASDAQ: AMZN) during inspections at six warehouse facilities in five states for failing to record work-related injuries and illnesses precisely. The findings are part of an ongoing investigation. Amazon faced $29,008 in proposed penalties. Occupational Safety and Health Administration, after a referral from U.S. Attorney’s Office, launched inspections on July 18, 2022, at Amazon locations in Deltona, Florida; Waukegan, Illinois; and New Windsor, New York; and on August 1, 2022, at sites in Aurora, Colorado; Nampa, Idaho; and Castleton, New York. Also Read: Amazon Drew Concerns From Democrat Senators Over Laxity In Warehouse Rebuilding After 2021 Tornado OSHA issued citations for failing to record injuries and illnesses, misclassifying injuries and diseases, and delayed recording of injuries and illnesses. In April, a study suggested Amazon U.S. warehouse workers suffered severe injuries at twice the rate of rival companies. In 2021, Amazon accounted for almost half of all injuries in the industry while making up a third of all U.S. warehouse workers. Price Action: AMZN shares traded higher by 0.56% at $88.35 in the premarket on the last check Monday. See more from Benzinga Amazon Taps Streaming Boom Via Games Workshop Deal For Warhammer Films Amazon Drew Concerns From Democrat Senators Over Laxity In Warehouse Rebuilding After 2021 Tornado Don't miss real-time alerts on your stocks - join Benzinga Pro for free! Try the tool that will help you invest smarter, faster, and better. © 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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The Zacks Analyst Blog Highlights Amazon.com, Novartis, Philip Morris International, Automatic Data Processing and Live Nation Entertainment

Amazon.com, Novartis, Philip Morris International, Automatic Data Processing and Live Nation Entertainment are part of the Zacks top Analyst Blog.

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The Zacks Analyst Blog Highlights Amazon.com, Novartis, Philip Morris International, Automatic Data Processing and Live Nation Entertainment For Immediate Release Chicago, IL – December 19, 2022 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Amazon.com, Inc. AMZN, Novartis AG NVS, Philip Morris International Inc. PM, Automatic Data Processing, Inc. ADP and Live Nation Entertainment, Inc. LYV. Here are highlights from Friday’s Analyst Blog: Top Analyst Reports for Amazon, Novartis and Philip Morris The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 16 major stocks, including Amazon.com, Inc., Novartis AG and Philip Morris International Inc. These research reports have been hand-picked from the roughly 70 reports published by our analyst team today. You can see all of today's research reports here >>> Amazon.com shares have been big laggards this year, on account primarily of two distinct factors. First, Amazon's growth outlook has gotten cloudier as a result of the uncertain macroeconomic backdrop resulting from the Fed's extraordinary tightening policy that has raised recessionary risks for the U.S. economy. Second, Amazon's near-term growth outlook is weighed down by the pulled-forward growth during Covid. The company heavily invested in human and physical capacity during Covid that has produced somewhat of a mismatch between 'capacity' and demand growth that they are currently in the process of rationalizing through lay-offs and facility shutdowns. The stock is down -47.9% this year vs. the -17.2% decline for the S&P 500 index and the Zacks Retail sector's -26.5% pullback. Amazon's main Retail sector rival Walmart is up +4.8% this year. Nevertheless, Amazon's third quarter results were driven by Prime and AWS momentum. Strengthening AWS services portfolio and its growing adoption rate contributed well. Ultrafast delivery services and expanding content portfolio were beneficial. Strengthening relationship with third-party sellers was a positive. Robust advertising business contributed well. Improving Alexa skills along with robust smart home products offerings were tailwinds. Amazon's strong global presence and solid momentum among the small and medium businesses remain positives. Growing capabilities in grocery, pharmacy, Amazon Care, Kuiper and Zoox are other positives. Considering the abovementioned facts, the Zacks analyst expects 2022 revenue to be up 8.3% from 2021. (You can read the full research report on Amazon.com here >>>) Novartis' shares have gained +5.9% over the past year against the Zacks Large Cap Pharmaceuticals industry's gain of +15.1%. The company's performance in the third quarter was pretty ho-hum, as earnings beat by a penny but revenues lagged due to generic competition. With the planned spin off of Sandoz, Novartis is looking to become a pure-play pharmaceutical company. Novartis has a strong and diverse portfolio. Solid momentum in key brands like psoriasis drug Cosentyx, cardiovascular drug Entresto, gene therapy Zolgensma, the oncology portfolio and the launch of Kesimpta continue to boost performance. The launch of additional drugs like Pluvicto, Piqray, Leqvio and Mayzent and the label expansion of key drugs should also boost performance further. Management's focus on cost savings should boost the bottom line as well. However, generic competition for key drugs and pipeline setbacks are concerns. (You can read the full research report on Novartis here >>>) Philip Morris' shares have outperformed the Zacks Tobacco industry over the past year (+8.4% vs. +3.7%). The company has been benefiting from its strong pricing power. Also, focus on reduced risk products, especially IQOS has been working well for the company, which is witnessing continued product mix shift from cigarettes to smoke-free products. However, Philip Morris has been battling cost-related headwinds. In third-quarter 2022, the proforma adjusted operating income margin fell 1 point on an organic basis. Management lowered its proforma adjusted operating margin organic growth view for 2022, wherein it expects gross margin contraction due to a considerable rise in IQOS device volumes, the increased initial cost of IQOS ILUMA, elevated logistic costs, growth-oriented investments in the smoke-free space, raw material and energy cost inflation and incremental supply-chain costs. (You can read the full research report on Philip Morris here >>>) Other noteworthy reports we are featuring today include Automatic Data Processing, Inc. and Live Nation Entertainment, Inc. Why Haven't You Looked at Zacks' Top Stocks? Our 5 best-performing strategies have blown away the S&P's impressive +28.8% gain in 2021. Amazingly, they soared +40.3%, +48.2%, +67.6%, +94.4%, and +95.3%. Today you can access their live picks without cost or obligation. See Stocks Free >> Just Released: Zacks Top 10 Stocks for 2022 In addition to the investment ideas discussed above, would you like to know about our 10 top buy-and-hold tickers for the entirety of 2022? Last year's 2021Zacks Top 10 Stocks portfolio returned gains as high as +147.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys Access Zacks Top 10 Stocks for 2022 today >> Media Contact Zacks Investment Research 800-767-3771 ext. 9339 support@zacks.com https://www.zacks.com Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Novartis AG (NVS) : Free Stock Analysis Report Automatic Data Processing, Inc. (ADP) : Free Stock Analysis Report Philip Morris International Inc. (PM) : Free Stock Analysis Report Live Nation Entertainment, Inc. (LYV) : Free Stock Analysis Report To read this article on Zacks.com click here.

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Crown Crafts: A Debt-Free Balance Sheet Contributes To A Bright Future

Crown Craft's share price declined by 46.78% from all-time highs. Net sales are stabilizing after a post-covid boost. Read more on CRWS stock here.

SeekingAlpha

Crown Crafts: A Debt-Free Balance Sheet Contributes To A Bright Future Summary - The share price declined by 46.78% from all-time highs. - Net sales are stabilizing after a post-Covid boost. - Gross profit and EBITDA margins are temporarily depressed, but the company continues to be profitable. - A flexible dividend policy and a debt-free balance sheet allow its viability in the long term. - The share price decline has left investors with a fixed dividend yield of 5.87%. Investment thesis Crown Crafts (NASDAQ:CRWS) is weathering the current inflationary and supply chain pressures with great resilience. Although net sales are declining in fiscal 2023 as a result of higher-than-usual demand during fiscal 2022 due to supply chain issues caused by the reopening of the American economy after the coronavirus pandemic crisis, margins remain very healthy as the company is building up inventories. Still, the share price declined by 46.78% from decade-highs of $10.24. Inflationary pressures, which have actually been stabilizing in recent months, as well as decreasing sales, add to fears of a potential recession as a result of increasing interest rates to contain inflation. Said inflation is making itself felt in the pockets of consumers, which is producing a reduction in their spending on the company's products as they look for cheaper alternatives. Despite all this, I believe the the fall in the share price presents an opportunity for dividend investors with a long-term time horizon as the fixed dividend yield increased to 5.87% and the current headwinds are most likely temporary due to its direct link with the current macroeconomic context. Furthermore, cash from operations remains high and the company has no debt and pays special dividends quite regularly while inventories have increased in recent years, which will eventually be transformed into cash from operations in the short to medium term. Nevertheless, no special dividends were declared in 2023, and these could be temporarily paused due to current recessionary risks, which is the temporary pain that investors will have to assume in exchange for the current share price decline, as well as the risk that a confirmed or deeper-than-expected recession will push the share price even lower. A brief overview of the company Crown Crafts is a manufacturer of products for infants whose operations are mostly located in the United States. The company operates under two wholly-owned subsidiaries: NoJo Baby & Kids, Inc., and Sassy Baby, Inc., and manufactures bedding and blankets, bibs, soft bath products, disposable products, developmental toys, and accessories for the infant, toddler, and juvenile industries. The company was founded in 1957 and its market cap currently stands at ~$55 million, employing around 126 full-time workers. Crown Crafts' products are mainly sold directly to retailers, and the company also supplies private labels. In my opinion, Crown Crafts represents a company that dividend investors can hold for the long term as the management makes very conservative use of the cash generated through operations thanks to special (and thus more flexible) dividends and a debt-free balance sheet. Currently, shares are trading at $5.45, which represents a 46.78% decline from the spike of $10.24 in October 2016. This decline is due to a series of factors that are linked to the current macroeconomic context. On the one hand, the supply chain issues experienced in 2021 have promoted an inventory accumulation by customers as soon as it was possible in order to prevent said headwind from happening again. On the other, the diminishing purchasing power of consumers as a consequence of inflation, as well as more prudent spending due to growing fears of a potential recession in the coming months or years, are holding back consumer purchases. But the temporary and particular nature of these headwinds makes me consider Crown Crafts a good bet for the future at the current share price since the potential dividend income is very large due to the current high yield on cost. Net sales are stabilizing after a post-Covid boost While it is true that fiscal 2022 was a good year for the company as net sales increased by 10.35% compared to fiscal 2021 after an increase of 7.86% in fiscal 2021 compared to fiscal 2020, net sales have been somewhat stagnant throughout the last decade. The Sassy Baby business segment, which was acquired in August 2017 for $6.5 million, has helped in giving a boost to sales after a first half of the past decade marked by declines. But it seems that the fiscal 2022 pull as a result of the reopening of the American economy after restrictions imposed to overcome the coronavirus pandemic crisis is beginning to fade. Net sales declined by 16.04% year over year during the first quarter of fiscal 2023, and by 7.39% during the second quarter as the company's customers have excess inventory because they bought more products than usual during the second half of fiscal 2022 to offset past supply chain issues, which is currently producing lower replenishing orders. The change in consumption habits of consumers, who are opting for products with lower price ranges is also contributing to this decline as inflation is beginning to affect their pockets. As CEO Olivia Elliott recognized in the last earnings call: This situation has been exacerbated by a change in consumer buying patterns whereby many consumers are now trading down to lower-priced items, buying fewer items or foregoing some items altogether due to the inflationary concerns. CEO Olivia Elliott - Q2 2023 Earnings Call To this, we must add that the company closed its subsidiary Carousel Designs in May 2021, which produced net sales of $4.8 million in fiscal 2020, due to high costs, declining sales, and operating and cash flow losses. This happened after acquiring it for $8.7 million, plus capital leases amounting to $845,000, in August 2017. Since then, the company has continued to focus on its core business as it has recently announced the launch of a line of Made Green toys. Currently, 51.2% of the company's net sales are provided by the NoJo Baby & Kids subsidiary, whereas 48.1% are provided by operations in the Sassy Baby subsidiary. Most of the company's sales take place within the United States as international sales represented only 3% of the total in fiscal 2021 and 4% in fiscal 2022, and this means that the geographical diversification of the company's operations is very limited and, therefore, is dependent on the evolution of the US economy. But the decline in the share price since 2016, coupled with rising net sales after that period, has produced a significant drop in the P/S ratio, which currently stands at 0.665. This means that the company generates annual net sales of $1.47 for each dollar held in shares by investors. In this sense, investors are placing less value on the company's sales, and this is mainly due to two factors: firstly, sales are expected to slow down as a result of overstocking by customers and prudent purchases by consumers and, secondly, profit margins have suffered in recent quarters as a result of inflationary pressures. As a consequence, the current P/S ratio is 25.70% lower than the average of the past decade and 50.04% lower than the highest point of 1.331 of the past decade. Margins are temporarily depressed due to inflationary pressures Inflationary pressures are having a significant impact on the company's profit margins, but despite this, the company remains profitable with a trailing twelve months' gross profit margin of 27.98% and an EBITDA margin of 16.47% as increasing production costs have partially stabilized in recent months. Lower marketing and administrative expenses (from 15.6% of net sales during the second quarter of fiscal 2022 to 14.6% during the last quarter) are helping to maintain a more than healthy EBITDA margin, but the gross profit margin continues to be slightly depressed compared to the ~30% enjoyed a year ago. In this sense, I strongly consider that although profit margins are in a worse situation compared to a year ago, they are still in a healthy range, and it is not so common to find a company with such a low P/S ratio and such healthy profit margins. Furthermore, the balance sheet holds zero debt, which greatly reduces risks for investors. A safe and juicy dividend awaits long-term investors Apart from a fixed dividend, the company declares special dividends from time to time. Its quarterly dividend is fixed at $0.08 per share, and the company recently paid special dividends of $0.35 in fiscal 2022, $0.25 in 2021, $0.25 in 2020, $0.40 in 2017, and $0.25 in 2016. These special dividends have tended to be paid in December. This means that the company pays a fixed dividend of $0.32 per share, which gives us a dividend yield of 5.87% at current share prices, to which special dividends should be added. Still, the company hasn't declared any special dividend for fiscal 2023. Crown likely needs to retain cash in its balance sheet due to inflationary pressures and, more importantly, recessionary concerns in the short to medium term, and as an investor, I wouldn't expect any special dividend payout until said concerns fade, although this is partially offset by the higher fixed dividend yield due to the share price decline. Below is a table with the dividend cash payout ratio of recent years that should help to determine the company's historical ability to cover its dividends. I have used cash from operations for the calculation because in this way we can do the calculation with cash coming from actual operations. |Fiscal year||2014||2015||2016||2017||2018||2019||2020||2021||2022| |Cash from operations (in millions)||$3.64||$4.77||$11.02||$10.39||$2.45||$8.97||$8.53||$8.74||$8.26| |Dividends paid (in millions)||$3.15||$3.21||$3.21||$9.72||$3.22||$3.23||$5.79||$5.01||$6.72| |Cash payout ratio||86.56%||67.25%||29.15%||93.55%||131.31%||35.97%||67.84%||57.36%||81.33%| As we can see, special dividends have created large variations in the dividend cash payout ratio over the years. This is a reflection of the flexibility that the management enjoys through its dividend policy since the fixed dividend represents a relatively low expense for the company while surpluses are distributed to shareholders through special dividends if applicable. In short, the dividend cash payout ratio has been sustainable over the years despite special dividends, and despite having exceeded the 100% line in 2018 due to lower-than-usual cash from operations. If the cash from operations suffers significant volatility due to current and/or new headwinds, the management has the ability to regulate the cash payout ratio by adjusting the special dividend or by temporarily stopping from paying it, which increases the safety of the current fixed dividend yield of 5.87%. But trailing twelve months' cash from operations of $7.7 million suggest that this will not be necessary if the current headwinds do not intensify or if new headwinds don't appear in the scene. And even if it happened, that amount of cash is currently enough to cover over two times the company's annual dividend expenses, so the company can assume falls in cash from operations without compromising its future or the sustainability of the dividend. Furthermore, inventories increased by $3.5 million in the past year and accounts receivable by $0.9 million while accounts payable declined by $0.7 million. During the last quarter, the company reported cash from operations -$0.8 million, but inventories increased by $1.3 million and accounts payable decreased by $2.7 million while accounts receivable remained flat, which makes me consider that it is still profitable despite the current headwinds. A debt-free balance sheet places the company in an advantageous position The company currently holds $2.34 million in cash on hand and $27.73 million in inventories and enjoys a debt-free balance sheet, which places it in a position where it does not have to face any interest payment at the end of each period. Thanks to this, the company can invest all of its profits to expand its operations or distribute them among shareholders in the form of special dividends. Due to unusually high inventories, cash from operations is expected to be high in the coming quarters, which could allow for a new acquisition in order to continue increasing the company's sales or, if the management fails to find an optimal candidate, more special dividends. In this sense, the company enjoys enormous room for maneuver despite the current complex macroeconomic landscape, which offers, in my opinion, a lot of security to the current dividend, whose yield on cost has increased to 5.87% as a consequence of the share price decline that has taken place since 2026, which was recently accelerated by current inflationary pressures despite a recovery in late 2020 that continued throughout 2021. Risks worth mentioning Although Crown Crafts' risk profile is greatly reduced thanks to the conservative use of the cash that the management makes and a debt-zero balance sheet, there are three main risks that I would like to comment on as they are very significant. - In fiscal 2022, 52% of the company's net sales were provided by Walmart (WMT) stores and 21% from sales from Amazon (AMZN). This means the company's sales are heavily dependent on Walmart orders and Amazon sales, which is partly out of the control of Crown Crafts' management. A significant reduction in the sales of one of these two customers would have a direct and significant impact on the company's sales, which would drag down the company's profit margins due to a high reduction in volumes. - The company may need to provide higher-than-normal discounts in order to empty part of its inventories if it needs to make room for new and more updated products, which could translate into even lower profit margins in the short-to-medium term. - Inflationary pressures could continue to negatively affect the company's operations, with which profit margins would be affected for longer than expected. On the other hand, the rise in interest rates to contain said inflation could cause a recession, with which the company's operations could be even more negatively affected than at present. Conclusion Crown Crafts has been operating for 65 years and nothing indicates that it will stop doing so in the coming years. Operations have been fairly stable during the coronavirus pandemic in calendar 2020, during the reopening of the economy in calendar 2021, and during the current inflationary pressures and supply chain issues in calendar 2022. But despite this, the share price has declined by 45.70% since October 2016 driven by a series of quarters that were very negative by then (but temporary) in terms of net sales, the subsequent drop in profit margins partly as a consequence of lower-than-expected profitability in the acquired Carousel Designs subsidiary, and the current inflationary headwinds, and this share price decline has caused the current fixed dividend yield to increase to 5.87%. Furthermore, there is now the fear that a deeper recession than expected could cause profitability issues for the company in the medium term. Still, I think this represents a good opportunity to acquire shares of the company at current prices as it keeps generating positive cash from operations (despite the -$0.8 million declared in the past quarter, which was offset by increasing inventories and decreasing accounts payable) while inventories keep growing, which suggests that it could continue paying special dividends once current headwinds and recessionary risks fade as it has done during the past decade. This article was written by Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. Comments (2) "The change in consumption habits of consumers, who are opting for products with lower price ranges is also contributing to this decline" Thanks

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Cloud-based apps that could benefit from the IT slowdown, with Citi's Ron Josey

Ron Josey, Citi analyst and managing director, joins 'TechCheck' to discuss the bull case for Amazon and Meta, the spending slowdown associated with the transition to cloud and Citi's top tech picks.

CNBC

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Here's My Favorite Stock I Bought in 2022

The stock market was a scary place for much of 2022, but it was also full of opportunities for long-term investors to put money to work. In this video, Matt Frankel, CFP, and Fool.com contributor Tyler Crowe talk about the stocks they added to their portfolios in the past year that they are most excited about.

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Here's My Favorite Stock I Bought in 2022 The stock market was a scary place for much of 2022, but it was also full of opportunities for long-term investors to put money to work. In this video, Matt Frankel, CFP, and Fool.com contributor Tyler Crowe talk about the stocks they added to their portfolios in the past year that they are most excited about.

AMZN

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3 Warren Buffett Stocks That Could Soar 39% to 83% in 2023, According to Wall Street

Warren Buffett is doing in 2022 what he's frequently done throughout his career -- beating the market. According to Wall Street, these three Buffett stocks could soar by 39% to 83% next year. Buffett himself likely didn't make the call to buy Snowflake (NYSE: SNOW) for Berkshire's portfolio.

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3 Warren Buffett Stocks That Could Soar 39% to 83% in 2023, According to Wall Street Warren Buffett is doing in 2022 what he's frequently done throughout his career -- beating the market. According to Wall Street, these three Buffett stocks could soar by 39% to 83% next year. Buffett himself likely didn't make the call to buy Snowflake (NYSE: SNOW) for Berkshire's portfolio.

AMZN

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TV and movie streaming: how UK viewers can save

How to cut costs on viewing services such as Netflix, Disney+ and Amazon Prime Video

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TV and movie streaming: how UK viewers can save Whether you pay for several different streaming services or have signed up for a bumper TV, films and sport package through your broadband and TV provider, there may be ways to bring down the cost of watching your favourite shows – while still having far more programmes and movies to choose from than there are hours in the day. Simplify “Many people are still stuck with the idea that they need one of the pay-TV companies like Sky or Virgin Media for everything,” Or Goren, the editor of the website Cord Busters, says. “But you definitely don’t need those expensive contracts any more, or their equipment. For most people these days, a smart TV will probably be enough.” If you bought your TV before about 2016 and it has an HDMI port, Nick Baker, the TV and broadband editor at Uswitch, says: “You can effectively make your normal TV a smart TV quite affordably, with a Roku stick, Chromecast or Amazon Fire Stick.” Amazon Fire TV Sticks start from £29.99, while Google’s Chromecast costs from £24.99 (both let you shout at the telly when you want to change the channel). You will also need a TV licence to watch the BBC, which costs £159 a year. You need broadband, too, but a mid-range service is usually enough, Goren says. There are multiple providers offering broadband (with a phone line) for about £20 a month. Start from scratch “There’s never enough time to watch everything, so there’s no need to pay for everything,” Goren says. “You don’t need all the streaming services. The first thing to do is cancel them all. Netflix, Disney+, Amazon Prime Video. Cancel them,” he says. Streaming services generally have no cancellation fees, and no setup charges if you choose to come back at a later date, so you are usually free to come and go as you please. Once you have a clean slate, take a look at what you want to watch, and limit your new subscription to your priorities. “You’ve heard about this big new show on Netflix or Disney+ or whatever, and you really want to watch that, so choose that service. Just subscribe to the one you want to watch something on today,” Goren says. “Keep that service for a month. Then, when you feel like you’re done with Netflix, and there’s not much at the moment that you want to watch but there is something you’re interested in on Prime Video, sign up to that instead – but cancel Netflix.” Review in a few months’ time, when you may have inadvertently begun to build up an unnecessarily big pile of streaming services all over again. In recent months, hundreds of thousands of households have cancelled their subscriptions to Netflix or Amazon Prime Video because of the cost of living crisis. Plan ahead Use a service such as JustWatch to find out which streaming service has what you want. Enter the name of the movie or series, or a favourite actor or director, and it will list all the different ways in which you can watch them. (For Christmas viewing, Elf is currently available to rent for £3.49 from Amazon Prime Video in HD, and streaming for Sky and Now subscribers. It’s a Wonderful Life is included for Amazon Prime Video subscribers, or £1.99 to rent for non-subscribers; it’s free on the ad-supported streaming service Plex.) “It’s also possible to set an alert so you can restart your subscription when your favourite shows are coming back,” Leo Brahm of JustWatch says. “If you are a Stranger Things fan, and that’s all you really need Netflix for, you can cancel at the end of a season and set an alert for when the next one starts, then resubscribe to the streaming service when the new season arrives.” You can even set it to alert you when a movie or show you would like to watch becomes available somewhere for free. Free trials and discounts There are various deals out there. For example, Amazon Prime Video is currently offering 30 days free for new subscribers; after that, it costs £8.99 a month. Students qualify for a six-month free trial, although you will need to provide proof of student status – either an .ac.uk email address, NUS membership card or another document from a list on the site. Student Prime rates continue for a maximum of four years, and your account is then automatically charged at standard Amazon Prime rates. For movie lovers, the cinephile streaming service Mubi, which has a collection of films from around the world, offers a seven-day trial, then costs £10.99 a month (£6.99 for students). Meanwhile, the British Film Institute’s BFI Player is free for 14 days, then £4.99 a month. Compare the costs of committing If you know you always watch all of the sport all of the time, or you want to see new movie releases as soon as they are out, then a longer contract may be worth it. “It’s likely to be more affordable if you’re going for prime packages,” Baker says. “Sports and movies will be more expensive when you get them individually. Bundling it all in is definitely easier and will save you money on an 18-month contract.” Nonetheless, this does mean you are locked into what can be a higher monthly subscription fee – which, right now, many would rather avoid. Virgin Media’s 18-month sports package includes broadband, BT Sport and Sky Sports (but you would have to pay extra for Netflix) and costs £72 a month. If you are using these channels on a more occasional basis, Goren says, “flexibility still wins”. Monthly subscriptions, while they may cost more on a one-off basis, give you the flexibility to dip in and out of different streaming services, and picking and choosing according to the events you want to follow may work out less expensive. The BT Sport monthly pass (£25) means sports fans can opt in when they want, while Now offers Sky Sports for £33.99 a month, with no contract. Watch for less with ads Netflix launched its Basic with Ads plan when the number of subscribers dropped for the first time in a decade because of increased pressure on household finances. This ad-supported plan is £4.99 a month. However, some of the shows on the ad-free packages are not available. Netflix says viewers will see an average of about four minutes of adverts in each hour; there’s no option to skip or fast-forward ads but they won’t be shown on kids’ profiles. Freevee is Amazon’s free ad-supported streaming service. Fans of the soap Neighbours may have heard of it because, from 2023, viewers will be able to “re-explore the lives, loves and challenges” of the Ramsay Street residents. Other past TV shows include 30 Rock and Parks and Recreation. At the time of writing, it offered classic films such as Reservoir Dogs, as well as plenty of movies you may not have heard of. Freeview Play, meanwhile, claims to give viewers “95% of the nation’s favourite TV, all for free” (BBC iPlayer, ITV Hub, All 4, My5 and a few others). Most recent TVs and recorders have Freeview Play built in. If you have an older TV, you can buy a set-top box (about £125) to access Freeview Play. • All prices and details correct at the time of writing.

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