NVIDIA Shares Ease After Topping Earnings Forecasts

NVIDIA Corporation (NVDA) shares slipped in Wednesday’s extended-hours trading session despite the chipmaker surpassing Wall Street’s top and bottom-line expectations.

The Santa Clara-based company posted a first-quarter profit of $3.66 per share, easily exceeding analysts’ expectations of $3.28 a share. Meanwhile, revenue for the period came in at $5.66 billion, with the figure coming in comfortably ahead of the $5.41 billion consensus mark and growing 84% from a year earlier on the back of a surge in demand for graphics chips driven by pandemic gaming. Moreover, the company said it expects sales in the current quarter to increase 62% from a year ago.

However, news that supply issues look like continuing for the foreseeable future spooked investors. “We expect to remain supply-constrained into the second half of the year,” chief financial officer Kress said, per MarketWatch. The company said it planned to manage the shortage by adding software to deter cryptocurrency miners from using its gaming chips. During the quarter, processing chips designed specifically for digital currency generated $155 million in revenues.

Through Wednesday’s close, the NVIDIA share price has a market capitalization of $391 billion, offers a tiny 0.10% dividend yield, and trades 20.26% higher on the year. By comparison, the tech-heavy Nasdaq index has gained 6.59% over the same period. From a valuation standpoint, the stock trades 24% above its five-year average forward earnings multiple of 36.69 times.

Wall Street View

Susquehanna’s Christopher Rolland reiterated his ‘Positive’ rating and $700 price target after Nvidia’s quarterly report. Rolland told investors that demand for the chipmaker’s GPUs remains robust, but he sees sales slowing in the second half of the year as reopenings and physical activities resume across the United States.

Broker coverage remains firmly in the bull camp elsewhere on Wall Street also. The stock receives 29 ‘Buy’ ratings, 5 ‘Overweight’ ratings, 4 ‘Hold’ ratings, 1 ‘Underweight’ rating, and 1 ‘Sell’ rating. Twelve-month price targets range from a Street-high $800 to $380 low, with the median pegged at $675.

Technical Outlook and Trading Tactics

NVIDIA shares have traded within a $175-point range since early September, with the bulls nor the bears able the take control of price action.

Given Wednesday’s after-hours weakness, active traders should consider opening a short position near the trading range’s upper trendline resistance area at $645, while looking to cover near the range’s lower trendline at $470. Protect capital by exiting the trade if the stock breaks out to a new all-time high on above-average volume.

For a look at today’s earnings schedule, check out our earnings calendar.

Lordstown Motors Crashes 10% Amid Trimmed Production Forecasts

Shares in electric vehicle truck startup Lordstown Motors Corp. (RIDE) slumped 10.55% in extended-hours trade Monday after the company slashed its full-year production guidance and told investors it needed to raise additional capital.

The company said it now plans to produce half the Endurance electric pickups this year than it had previously anticipated. “Expected Endurance production in 2021 will be limited and would at best be 50% of our prior expectations,” read a company statement accompanying the EV maker’s first quarter (Q1) results, per MarketWatch. During the company’s Q4 earnings call, management flagged a production capacity of 60,000 trucks. Lordstown also told investors it required additional cash to continue funding its business plans and is in the process of securing an Advanced Technology Vehicle Manufacturing loan.

On the earnings front, the company said it made a loss of 72 cents per share in the quarter, much wider than the 28 cents a share figure Wall Street had expected. The bottom line loss also ballooned out from the 16 cents a share loss reported in the year-ago quarter.

Through Monday’s close, Lordstown Motors stock has a market value of $1.6 billion and trades 51.79% lower since the start of the year. However, the shares have gained around 15% over the past week.

Wall Street View

Earlier this month, Wolfe Research analyst Rod Lache downgraded Lordstown shares to ‘Underperform’ and lowered his price target to $1. Lache thinks the company will have difficulty competing in the commercial electric vehicle pickup space, specifically matching Ford’s price levels for its recently revealed F-150 Lightning electric pickup truck.

Elsewhere, the stock receives 1 ‘Buy’ ratings, 2 ‘Hold’ ratings, and 2 ‘Sell’ ratings. Twelve-month price targets range between $1 and $40, with the median pegged at $12 – 39% above Monday’s extended-hours closing quote of $8.65.

Technical Outlook and Trading Tactics

Despite analysts’ downbeat outlook for Lordstown shares, price action tells another story. The price recently broke above a multi-month downtrend line on above-average volume, indicating bullish conviction behind the move. Moreover, the MACD indicator crossed back above its trigger line last week to generate a buy signal.

Therefore, active traders should view news-driven selling pressure as a buying opportunity, providing the stock holds above this month’s low at $6.69. Look to book profits on a retest of key overhead resistance near the green horizontal trendline at $17.

For a look at today’s earnings schedule, check out our earnings calendar.

Cisco Shares Slip After Earnings Guidance Disappoints

Shares in IT networking giant Cisco Systems, Inc. (CSCO) plunged over 5% in Wednesday’s extended-hours trading session after the company disappointed investors with its earnings guidance for the current quarter amid ongoing chip supply disruptions.

Management sees fiscal fourth quarter (Q4) earnings ranging between 81- and 83 cents, with revenue growth of 6% to 8%. Wall Street had expected EPS of 85 cents and 5.5% revenue growth. “We’re also seeing similar component shortage supply issues as our peers,” Cisco CEO Chuck Robbins said, per MarketWatch. “The good news, and this is reflected in our guidance, is that we are confident we will work through this as we have already put in place revised arrangements with several of our key suppliers,” he added.

Other key metrics came in ahead of forecasts. The company reported Q3 adjusted earnings of 83 cents per share versus a consensus of 82 cents a share. Meanwhile, revenues of $12.80 billion topped analysts’ expectations of $12.56 billion. On a year-over-year (YoY) basis, the top and bottom line grew 6.6% and 5%, respectively.

Through Wednesday’s close, Cisco stock has a market value of $221.52 billion, offers a 2.8% dividend yield, and trades 17.63% higher over the past twelve months. Year to date (YTD), the shares have added 17.25%, outperforming the tech-heavy Nasdaq index by 14% over the same period. Valuation-wise, the stock trades at 15.48 times forward earnings, slightly above its five-year average multiple of 14.44 times.

Wall Street View

After the company’s quarterly earnings, Deutsche Bank analyst Matthew Niknam initiated coverage of the stock with a Hold rating and $55 price target. Niknam says Cisco “screens attractively from several angles” but offers limited upside against consensus estimates. The analysts also noted the stock trades at a premium on a standalone and industry bias.

Coverage elsewhere on Wall Street remains mostly bullish. The stock receives 14 ‘Buy’ ratings, 3 ‘Overweight’ ratings, and 1 ‘Sell’ rating. Currently, no broker recommends selling the shares. Twelve-month price targets range from a Street-high $65 to a low of $45, with the median pegged at $55.

Technical Outlook and Trading Tactics

Cisco shares have trended steadily high since late October, with only one sizeable retracement to the 50-day simple moving average (SMA) in early March. More recently, however, a dark cloud cover pattern formed on the chart, indicating short-term weakness.

Traders and investors should view earnings-related selling pressure as a buying opportunity if the price holds the $48 level where it finds support from a multi-month horizontal trendline.

For a look at today’s earnings schedule, check out our earnings calendar.

3 Gold Stocks Exploring the 200-Day Moving Average

After taking a backseat to Bitcoin for the past six months, gold has finally regained some of its shine in recent weeks amid lackluster economic data and concerns about rising inflation.

“It seems to be that it is the fear of inflation rising beyond the US Federal Reserve’s comfort levels driving precious metals, helped by the suggestion of a possible rise in interest rates sooner than the Fed has been predicting all along,” Sharps Pixley’s Lawrie Williams told leading industry publication Mining Journal.

The yellow metal closed 1.6% higher Monday to settle at $1,867.60 an ounce, its highest level in over four months. Gold’s turnaround helped propel these three leading gold mining stocks above their 200-day simple moving average. Below, we take a closer look at each and use technical analysis to identify important chart levels.

Barrick Gold

Toronto-based Barrick Gold Corporation (GOLD) explores for, mines, and sells gold and copper, with key operations in North America, South America, Australia, and Africa. Last year, the miner produced around 5 million attributable ounces of gold and nearly 460 million pounds of copper. Through Monday’s close, Barrick Gold stock has a market capitalization of $44.76 billion and offers a 1.5% dividend yield. It trades up 10.93% on the year.

From a chart perspective, a break above the 200-day SMA in Monday’s trading session may act as a catalyst for a move up to key overhead resistance at $28.50.

Kinross Gold

Also headquartered in Toronto, Kinross Gold Corporation (KGC) is a leading gold and silver miner, producing roughly 2.4 million gold equivalent ounces in 2020. The company, which has used acquisitions for geographic expansion, operates in the Americas, West Africa, and Russia. Kinross Gold stock has a market value of over $10 billion and issues a 1.54% yield. YTD it trades 12.53% higher.

Taking a look at the technicals, a close above the 200-day SMA Monday on above-average volume indicates further upside that could see a test of crucial resistance at $9.30.

Kirkland Lake Gold

With an $11.62 billion market cap and 1.85% dividend yield, Kirkland Lake Gold Ltd. (KL) engages in gold mining and production activities. The company’s assets include the Macassa mine located in northeastern Ontario and the Fosterville gold mine situated in Victoria, Australia. Kirkland Lake Gold stock has gained nearly 6% since the start of the year.

Chart-wise, Monday’s breakout above the 200-day SMA may give bullion bulls the confidence to make a run at multiyear horizontal resistance around $51.

For a look at today’s earnings schedule, check out our earnings calendar.

Wish Shares Reach All-Time Low After Earnings Disappoint

Shares in Context Logic Inc. (WISH) – the parent company of discount online-purchasing platform Wish – plunged 13.86% in Wednesday’s extended-hours trading session after delivering disappointing quarterly earnings.

The San Francisco-based company posted a first-quarter loss of $128 million, or 21 cents a share, wider than the 17 cents per share loss Wall Street had expected. This compares to a loss of $66 million in the year-ago quarter. In better news, revenues of $772 million came in above the $743.1 million consensus mark and improved 75% on a year-over-year (YoY) basis.

Despite Chief Financial Officer Rajat Bahri telling investors that he expects macro conditions to improve this year, Wish’s forward sales guidance fell short of expectations. The company expects Q2 revenues of $715 million to $730 million, while analysts had forecast sales of $759 million. “Last year, the value-conscious consumer demographic was disproportionately affected by the pandemic. As the economy starts to recover, we believe macro trends will have a positive impact on our business,” Bahri wrote, per MarketWatch.

Through Wednesday’s close, Wish stock has a mark value of $7.1 billion and trades 37.12% lower since the start of the year, underperforming the internet commerce industry average by about half over the same period.

Wall Street View

Last month, Evercore ISI analyst Mark Mahaney initiated coverage on the stock with an ‘Outperform’ rating and a $22 price target. Mahaney sees the e-commerce company’s value proposition as its engaging, discovery-based shopping experience. Broker research elsewhere also remains mostly bullish. The stock receives 10 ‘Buy’ ratings and 2 ‘Hold’ ratings. Twelve-month price targets range from $20 to $40, with the shares currently trading 54% under the median target of $25.

Technical Outlook and Trading Tactics

After breaking above a multi-month downtrend line in late April, the price resumed its move lower. However, the indicator appears to have flipped from resistance into support, with the stock holding above this closely watched trendline. Furthermore, an RSI reading nearing oversold levels increases the likelihood of an upside reversal.

Active traders who take a long position in this area should eye an initial move up to key overhead resistance at $15.50, followed by a possible test of the December swing low at $17.60. Protect capital by exiting if the price closes below the downtrend line.

For a look at today’s earnings schedule, check out our earnings calendar.

Duke Energy Surges Higher After Earnings Top Expectations

Shares in Duke Energy Corporation (DUK) powered nearly 3% higher Monday after the company disclosed better-than-expected quarterly earnings, and a report surfaced that an activist investor has a stake in the utilities giant.

The company posted a first-quarter (Q1) adjusted profit of $1.26 per share, surpassing analyst expectations of $1.24 a share. Moreover, the bottom line improved 10.5% on a year-over-year (YoY) basis, driven by growth in the company’s electric utilities business. Revenues of $6.15 billion grew 3.4% from a year earlier; however, the metric came in shy of the $6.21 billion figure Wall Street had expected. Looking ahead, management sees full-year earnings per share (EPS) of $5.00 to $5.30 with a long-term growth rate of 5% to 7%.

“We are positioned to deliver sustainable long-term value as we accelerate our clean energy transformation by investing in renewables, battery storage and in our delivery system,” CEO Lynn Good said in a statement, per PR Newswire.

Monday afternoon, the Wall Street Journal reported that activist investor Elliott Management Corp. has a stake in the company. However, the size of the position remains unclear. According to the Journal, people familiar with the matter said Elliott may persuade Duke to offload underperforming assets and implement operational improvements.

As of May 11, 2021, Duke Energy stock has a market capitalization of $79.8 billion, offers an enticing 3.83% dividend yield, and trades 26.85% higher over the past twelve months. Since the start of the year, the shares have added 13.30%, outperforming the energy sector by around 8% over the same period. From a valuation standpoint, the stock trades 14% above its five-year average earnings multiple of 17.5 times.

Wall Street View

Last month, Wells Fargo analyst Neil Kalton raised the bank’s price target on the stock to $104 from $97, citing higher peer group multiples. Kalton also reiterated his ‘Equal Weight’ recommendation.

Elsewhere, broker coverage remains mostly bullish. The shares receive 6 ‘Buy’ ratings, 1 ‘Overweight’ rating, and 12 ‘Hold’ ratings. Twelve-month price targets range from a Street high $112 to a low of $96, with the average target sitting at $103.69. Look for additional broker upgrades in the months ahead as the push toward renewable energy gathers momentum.

Technical Outlook and Trading Tactics

Duke shares broke out from a pennant on above-average volume Monday, indicating further upside continuation. Furthermore, the moving average convergence divergence (MACD) indicator recently crossed back above its signal line to generate a buy signal.

Active traders who want to capitalize on short-term momentum should consider using a trailing bar stop to book profits. To utilize this exit strategy, remain in the trade until the price closes beneath the current day’s low, or the previous day’s low, depending on personal risk tolerance.

For a look at today’s earnings schedule, check out our earnings calendar.

PayPal Top Earnings Forecasts, Bets on Crypto

PayPal Holdings, Inc. (PYPL) shares rocketed over 4% higher in Wednesday’s extended-hours trading session after the company delivered a stellar quarterly earnings report.

The San Jose digital payments giant reported an adjusted first quarter (Q1) profit of $1.22 per share, blowing pasts Wall Street’s expectation of $1.01 a share. Moreover, the bottom line grew 85% from a year earlier. Revenues for the period came in at $6.03 billion, up from year-ago sales of $4.62 billion. Volume and user metrics also impressed, with the company processing $285 billion in the quarter and adding 14.5 million net new active accounts.

Looking ahead, management forecasts Q2 EPS of $1.12 on revenues of $6.25 billion. Analysts had expected earnings of $1.10 on sales of $6.16 billion. The company sees cryptocurrency continuing to drive growth in upcoming quarters. “We’ve got a tremendous amount of really great results going on tactically with our crypto efforts,” CEO Dan Schulman told investors, per CNBC. PayPal initially introduced leading cryptocurrencies to its platform last October and has progressively added more integration with digital assets over the past six months.

Through Wednesday’s close, PayPal stock has a market capitalization nearing $300 billion and trades nearly 100% higher over the last 12 months. YTD, the shares have added 5.64%, which trails the S&P 500’s gain of 11% over the same period.

Wall Street View

Late last month, Rosenblatt Securities analyst Sean Horgan raised his price target on the stock to $350 from $320 and maintained his ‘Buy’ recommendation. Horgan sees the payments giant continuing to benefit from higher levels of consumer spending, fueled by record levels of government stimulus.

Elsewhere, the stock racks up mostly favorable brokerage coverage. It receives 36 ‘Buy’ ratings, 5 ‘Overweight’ ratings, and 6 ‘Hold’ ratings. Just one analyst recommends selling the shares. Wall Street has a 12-month price median price target on the stock at $314.55. This represents 27% of upside from yesterday’s $247.40 close.

Technical Outlook and Trading Tactics

PayPal shares have recently retraced to a multi-month uptrend line extending back to the March 2020 pandemic-induced low. Although the price broke below this closely-watched indicator in Wednesday’s session, pre-market trading indicates a move back above it after the company’s solid earnings report.

Providing the stock closes above the trendline, active traders should anticipate a retest of the YTD high at $309.14. Protect capital with a stop-loss order placed under today’s low.

For a look at today’s earnings schedule, check out our earnings calendar.

Pfizer Gains as FDA Set to Approve Vaccine for Early Teens

Shares in biopharma giant Pfizer Inc. (PFE) rallied 3% on Monday after a federal official said the U.S. Food and Drug Administration (FDA) will authorize Pfizer’s COVID-19 vaccine to teenagers aged 12 to 15 by next week. Moreover, the official, speaking on the condition of anonymity, said the agency is expected to approve the drug maker’s two-dose vaccine to even younger children later this year.

The announcement comes a month after a clinical trial conducted by the company showed 100% efficiency in around 2,000 early teens. Currently, the FDA has only approved Pfizer’s vaccine for emergency use in the United States for people aged over 16. The country has ordered 300 million vials of the drug maker’s shot by the end of July and administered 131 million doses so far.

As of May 4, 2021, Pfizer stock has a market value of $222.2 billion, issues an attractive 4.04% dividend yield, and trades around 6% higher over the past 12 months. Since the start of the year, the shares have added 8.2%, just shy of the S&P 500’s 11.62% gain over the same period. From a valuation standpoint, the stock trades at 12 times forward earnings, 7.7% below its five-year average multiple of 13 times.

Wall Street View

Last month, SVB Leerink analyst G. Porges lowered the investment firm’s price target on the stock to $39 from $40 but maintained his ‘Market Perform’ rating. Porges expects the pharmaceutical giant to post current quarter EPS of 80 cents, up a penny from his previous forecast.

Elsewhere, the stock receives 6 ‘Buy’ ratings and 15 ‘Hold’ ratings. Currently, no broker recommends selling the shares. Coverage has turned slightly more positive in recent months as blood clot concerns continue to plague rival COVID-19 vaccine makers. Twelve-month price targets range from a high of $53 to Street-low $36, with the median pegged at $39.

Technical Outlook and Trading Tactics

Pfizer shares staged an impressive breakout from a pennant pattern on above-average volume Monday, indicating further upside continuation in upcoming trading sessions. Furthermore, the 50-day simple moving average (SMA) crossed back above the 200-day SMA this week to form a bullish “golden cross” buy signal.

Active traders who take a long position here should target a move back up to the December 2020 high at $43.08 and manage risk by placing a stop-loss order somewhere beneath the pennant’s lower trendline.

For a look at today’s earnings schedule, check out our earnings calendar.

Qualcomm Jumps after Sales Surge 52%

QUALCOMM Incorporated (QCOM) shares surged 5.21% in extended-hours trade Wednesday after the company delivered a quarterly earnings report that blew past Wall Street’s expectations.

The San Diego-based chipmaker disclosed a fiscal second quarter (Q2) adjusted profit of $1.90 per share, with the figure coming in ahead of the $1.67 consensus mark and growing 116% from a year earlier. Meanwhile, revenues of $7.94 billion topped the Street forecast and surged 52% from the March 2020 quarter. Management credited higher phone demand and robust handset shipments to China for the better-than-expected results.

Moving forward, the company sees fiscal Q3 adjusted earnings of $1.55 to $1.75 per share on revenues of $7.1 billion to $7.9 billion. Analysts forecast adjusted EPS of $1.52 and $7.11 billion in sales. “Looking ahead, Qualcomm is well-positioned for continued growth, and we remain confident in our ability to execute on the many opportunities in front of us,” said CEO Steve Mollenkopf in a statement accompanying the results, per MarketWatch.

Through Wednesday’s close, Qualcomm stock has a market capitalization of $156.78 billion, offers a 1.99% dividend yield, and trades 10.35% lower since the start of the year. However, the shares have gained over 80% over the past 12 months, outpacing the sector average by 6%. Valuation-wise, the stock trades 18.5% above its five-year average forward earnings multiple of 16.

Wall Street View

Earlier this month, Susquehanna analyst Christopher Rolland downgraded the stock to ‘Neutral’ from ‘Positive’ and trimmed his price target from $175 to $155. Rolland cited valuation concerns for the downgrade. “Industry lead-times and valuation multiples have expanded to levels well beyond their historical averages, adding potential risk to this already volatile sector,” he said.

Elsewhere, the stock receives 16 ‘Buy’ ratings, 2 “Overweight’ ratings, 9 ‘Hold’ ratings, and 1 ‘Sell’ rating. Brokerage twelve-month price targets range from $122 to $200, with the median sitting at $170.

Technical Outlook and Trading Tactics

Qualcomm shares have spent the past six weeks tracking along an uptrend line extending back to the March 2020 pandemic low. Furthermore, the price also finds support from the rising 200-day simple moving average (SMA).

Thursday’s expected rally from this level may act as a catalyst for the next significant move higher, possibly up to the all-time high (ATH) at $167.94. Those who take a trade here should minimize the downside with a stop-loss order placed beneath last week’s low at $132.47.

For a look at today’s earnings schedule, check out our earnings calendar.

Universal Health Services Trade Flat After Earnings Top Forecasts

Share in Universal Health Services, Inc. (UHS) traded mostly unchanged in Monday’s extended-hours session after the King Of Prussia, Pennsylvania-based company delivered a better-than-expected quarterly earnings report.

The hospital and health facility operator posted first quarter (Q1) adjusted earnings of $2.44 per share, comfortably ahead of the $2.15 a share figure Wall Street had expected. Moreover, the bottom line grew 41% from a year earlier. Meanwhile, revenues for the quarter came in at $3.01 billion, up from $2.83 billion in the March 2020 quarter. A 26.3% jump in net revenue per adjusted admission within the company’s acute care services business helped drive healthy top-line growth.

Management remains cautious about what impacts the pandemic will have on full-year earnings, noting that future developments are difficult to predict. “The extent to which the COVID-19 pandemic and measures taken in response thereto impact our business, results of operations, and financial condition will depend on numerous factors and future developments, most of which are beyond our control or ability to predict,” the company said in a statement accompanying the financial results, per the UHS website.

As of April 27, 2021, Universal Heath Services stock has a market value of $12.61 billion, offers a small 0.55% dividend yield, and trades 6% higher since the start of the year. Over the past 12 months, the shares have gained around 43%, underperforming the sector average by 17.78% during the same period. From a valuation standpoint, the stock trades in line with its five-year forward earnings multiple of 13.5.

Wall Street View

Last week, Deutsche Bank analyst Pito Chickering raised the bank’s price target on the stock to $160 from $145 and reiterated his ‘Buy’ rating. Chickering likes the broader healthcare industry, particularly providers who offer mental health services in the wake of the health crisis.

Coverage elsewhere on Wall Street also remains primarily bullish. The stock receives 7 ‘Buy’ ratings, 5 ‘Hold’ ratings, and just 1 ‘Underweight’ rating. Twelve-month price targets range from a Street-high $166 to a low of $133, with the median pegged at $150.5. The stock, currently trading at $145.78, offers a 3% discount to the median.

Technical Outlook and Trading Tactics

Universal Health shares have recently staged a rally from a multi-month uptrend line, pushing through crucial overhead resistance at $143.50. Over the past few trading sessions, the price has held above this closely watched level, indicating the bulls have successfully flipped resistance into support.

Those who buy in this area should look for a retest of the all-time high at $157.79. Protect capital by setting a tight stop-loss order slightly below the April 16 breakout price bar at $142.

For a look at today’s earnings schedule, check out our earnings calendar.

Chipotle Grill Trades Flat Despite Delivering Spicy Earnings

Chipotle Mexican Grill, Inc. (CMG) shares exchanged hands relatively unchanged in Wednesday’s extended-hours session, despite the Mexican food chain reporting blowout earnings.

The company posted a first-quarter (Q1) adjusted profit of $5.36 per share, with the figure topping Wall Street’s expectation of $4.89 a share and growing 74% from the year-ago quarter. Meanwhile, revenue of $1.74 billion during the period met analysts’ forecasts.

Comparable store sales boosted the top line, climbing 17.2% from a year earlier and 21% from pre-pandemic levels in 2019. Online orders, which account for around 50% of total sales, more than doubled during the quarter. Management credited a range of new menu items and government stimulus checks for the better-than-expected result.

Despite the company choosing not to provide full-year earnings guidance, Chairman and CEO Brian Niccol remained upbeat about the months ahead. “As vaccines roll out and we get closer to moving past this pandemic, I believe Chipotle is well-positioned for growth. I’m excited about our future as we remain focused on innovating in culinary, leading in food with integrity, and providing convenient access inside our restaurants and through our expanding digital ecosystem,” he told investors, per PR Newswire.

Through Wednesday’s close, Chipotle stock has a market value exceeding $40 billion and trades 92% high over the past 12 months. Year to date (YTD), the shares have added 8.72%, slightly trailing the S&P 500’s 11% gain over the same period. Valuation-wise, the stock trades 20% above its five-year average projected earnings multiple of 55.36 times.

Wall Street View

Last month, Cowen analyst Andrew Charles reiterated his ‘Outperform’ rating and $1900 price target on Chipotle shares. Charles pointed to the company’s underappreciated growth aspects, potential for broader loyalty adoption, and digital initiatives as supporting factors.

Coverage remains mostly bullish elsewhere on Wall Street. The stock receives 17 ‘Buy’ ratings, 3 ‘Overweight’ ratings, and 13 ‘Hold’ ratings. Just one analyst has placed an ‘Underweight’ recommendation on the shares. The stock currently offers a 14% discount to analysts’ 12-month median price target of $1,720.

Technical Outlook and Trading Tactics

Since bottoming out around $450 a share at the height of last year’s pandemic sell-off, Chipotle shares have trended consistently higher. More recently, the stock has formed two swing highs at the $1,560 level, increasing the possibility of a double top. Furthermore, the second peak made a slightly higher high while the RSI indicator made a relatively shallower high to mark a bearish divergence between price and the indicator.

Active traders who open a short position should target a move down to the $1,365 area where the shares find a confluence of support from a horizontal trendline and the rising 200-day simple moving average (SMA). Protect trading capital by placing a stop-loss order just above the high of the second peak at $1,579.52.

For a look at today’s earnings schedule, check out our earnings calendar.

IBM Poised for Breakout After Earnings and Sales Top Estimates

Shares in International Business Machines Corporation (IBM) jumped 2.99% in Monday’s extended-hours session after the American multinational technology company posted better-than-expected quarterly results.

The New York-based computing giant reported first quarter (Q1) adjusted earnings of $1.77 per share, comfortably ahead of the $1.63 mark analysts had expected. Revenue of $17.73 billion also came in ahead of forecasts and edged up nearly 1% from a year earlier, halting four consecutive quarters of declines during the COVID-19 pandemic.

The company’s Cloud and Cognitive Software Global segment, Business Services division and Systems business drove top-line growth, recording respective year-over-year (YoY) increases of 4%, 2%, and 4%.

“This quarter, we saw an improved trajectory in project activity and client-based business volumes, including in some of the industries most affected by the pandemic such as retail and consumer products,” said IBM CFO Jim Kavanaugh, per CNBC.

Through Monday’s close, IBM stock has a market value of $119 billion, offers an enticing 4.88% dividend yield, and trades nearly 6% higher on the year. Over the past 12 months, the shares have gained 10.82%, while the S&P 500 has added around 45% over the same period. From a valuation standpoint, the stock trades 14% above its five-year average forward earnings multiple of 10.69.

Wall Street View

Earlier this month, Morgan Stanley analyst Katy Huberty raised the bank’s price target on IBM to $150 from $140 while maintaining her ‘Equal Weight’ rating on the shares. Huberty anticipates a robust IT spending recovery in the quarters ahead, which she believes implies material upside to current consensus estimates.

Brokerage coverage elsewhere remains mixed. The stock receives 10 ‘Hold’ ratings, 5 ‘Buy’ ratings, and 2 ‘Sell’ ratings. Twelve-month price targets range between $115 to $165, with the median target sitting at $140. Expect further upgrades in the coming weeks as analysts factor in the company’s upbeat quarterly report.

Technical Outlook and Trading Tactics

IBM shares have spent the past few months consolidating under a multi-year downtrend line and the 200-day simple moving average (SMA). Aftermarket trading suggests an open Tuesday morning at $37, which would propel the stock above these two closely watched indicators. Such a move could be a catalyst for further upside, especially if above-average volume accompanies the gains.

If a breakout does occur, active traders should look for a retest of the 2020 high at $158.75 and protect capital with a stop-loss order placed under this month’s low at $133.40.

For a look at today’s earnings schedule, check out our earnings calendar.

Dell Surges After Agreeing to Cash Dividend for VMware Spinoff

Dell Technologies Inc. (DELL) shares jumped 8.5% in extended-hours trade Wednesday after the PC maker said it plans to proceed with a spinoff of its 81% stake in enterprise software firm VMware.

The deal, which both parties expect to close in the fourth quarter, will see Dell and its shareholders receive a collective one-time cash dividend of $11.5 billion to $12 billion from VMware. Management said it intends to use the proceeds from the transaction to pay down debt and position the company for an investment-grade credit rating.

“After a comprehensive review of potential strategic options, both parties determined that this transaction will simplify capital structures and create additional long-term enterprise value,” Dell said in a statement cited by CNBC.

Through Wednesday’s close, Dell stock has a market capitalization of $70 billion and trades 26.48% higher since the start of the year. Over the past 12 months, the shares have gained around 125%. Valuation wise, the stock trades at 11.39 times projected earnings, slightly above its five-year average multiple of 10.64 times.

Wall Street View

Earlier this month, Morgan Stanley analyst Katy Huberty raised the investment bank’s target on Dell to $107 from $98 while maintaining her ‘Overweight’ rating. As well as being bullish about the VMware spinoff, Huberty believes higher PC demand and exposure to the mid-market supports earnings moving forward.

Broker research elsewhere remains mixed. The stock receives 12 ‘Buy’ ratings and 9 ‘Hold’ ratings. Currently, no analysts recommend selling the shares. Twelve-month price targets range from a Street-high $110 to a low of $79. As of yesterday’s close, the shares trade at a 3% premium to the $90 median target.

Technical Outlook and Trading Tactics

Dell shares have remained in a steady uptrend over the past year, with gains accelerating in recent weeks. This may indicate that investors have baked in most of the positive news surrounding the VMware spinoff. Furthermore, the relative strength index (RSI) has made a shallower high relative to price over the last month, suggesting waning momentum from the bulls.

Active traders should think about taking a short sale if the stock stages an intraday reversal Thursday. In terms of trade management, look to buy back the shares near last month’s swing low at $84.81. This area also finds support from the 50-day simple moving average (SMA). Protect capital with a stop-loss order placed above the high of today’s price bar.

Dell Chart

For a look at today’s earnings schedule, check out our earnings calendar.

NVIDIA Tests All-Time High After Rosy Revenue Outlook

 

Shares in NVIDIA Corporation (NVDA) gained over 5% Monday after the Santa Clara chipmaker said that its sales for the current quarter sit ahead of previous forecasts. The upward revision comes after its total fourth quarter (Q4) revenues grew by 61%.

Although management did not provide a specific figure, it now expects Q1 revenue to come in above its earlier estimate of between $5.19- and $5.41 billion. “While our fiscal 2022 first quarter is not yet complete, Q1 total revenue is tracking above the $5.30 billion outlook provided during our fiscal year-end earnings call,” Nvidia’s CFO Colette Kress said in a statement cited by CNBC. Meanwhile, analysts expect sales during the period to reach $5.32 billion.

Earlier in the day, Chief Executive Jensen Huang told investors at the annual GTC developers conference that the company was launching its first data-center CPU that uses artificial intelligence. The new chip that powers computer servers is likely to intensify competition with key rival Intel Corp. (INTC), which controls over 90% of the CPU data-center market.

Through Monday’s close, NVIDIA stock has a market value of $377 billion, offers a small 0.11% dividend yield, and trades 131.36% higher over the past twelve months. By comparison, the industry’s largest exchange-traded fund (ETF) – the iShares PHLX Semiconductor ETF (SOXX) – has gained 103.13% over the same period.

Wall Street View

In late February, Raymond James analyst Chris Caso raised the investment firm’s price target on Nvidia to $700 from $600 while reiterating his Outperform rating. Caso pointed to “strong” revenue in the company’s gaming segment for the upgrade.

Coverage elsewhere on Wall Street also remains overwhelmingly favorable. The stock receives 26 ‘Buy’ ratings, 5 ‘Overweight’ ratings, 5 ‘Hold’ ratings, 1 ‘Underweight’ rating, and 1 ‘Sell’ rating. Twelve-month price targets range from $380 to $800, with the median target pegged at $660. Look for additional upgrades in the coming weeks as analysts revise revenue forecasts.

Technical Outlook and Trading Tactics

NVIDIA shares have oscillated within a 130-point range since early September. More recently, the price has rallied from the closely-watched 200-day simple moving average (SMA), with the stock closing just below its all-time high (ATH) at $614.90 in Monday’s trading session. Yesterday’s move on above-average volume indicates the involvement of larger market players, which may see the stock breakout into price discovery in the near future.

Active traders who position for such a move should use a fast period moving average as a trailing stop to capitalize on the bullish momentum. To use this technique, remain in the trade until the stock closes beneath the indicator.

For a look at today’s earnings schedule, check out our earnings calendar.

Twitter Gains Amid Clubhouse Buyout Speculation

Twitter, Inc. (TWTR) shares added nearly 3% Wednesday after Bloomberg reported that the social media giant considered acquiring popular invitation-only audio-chat app, Clubhouse. The platform allows users to host shows, listen to panel discussions and engage in live chats.

People familiar with the matter said both parties discussed a possible valuation of $4 billion for Clubhouse but added that the negotiations had ceased. A potential buyout would have brought across the app’s 10 million active weekly users and complemented Twitter’s own recently launched beta-stage audio offering, Spaces. Such is the success of the Clubhouse app, other tech companies, including Facebook, Inc. (FB), Microsoft Corporation (MSFT), and Salesforce.com, inc. (CRM) have begun to develop similar features on their social media platforms.

As of April 8, 2021, Twitter stock has a market value of $55.1 billion and trades up 27.41% YTD. Over the past 12 months, the shares have surged nearly 170%. From a valuation standpoint, the stock trades 46% above its five-year average forward earnings multiple of 49 times.

Wall Street View

In February, Piper Sandler analyst Thomas Champion bumped up the investment firm’s price target on the stock to $61 from $45 while reiterating his ‘Neutral’ rating. Champion believes the company sits well-positioned to capitalize on daily active user growth it gained from the U.S. election. He also likes improvements the social media giant has made to its products and advertising.

Elsewhere, the stock receives 25 ‘Hold’ ratings, 10 ‘Buy’ ratings, 4 ‘Sell’ ratings, and 1 ‘Underweight’ rating. Twelve-month price targets range from a Street-high $95 to a low of $30. Through Wednesday’s close, the shares trade 5% below the median analyst price target of $72.50.

Technical Outlook and Trading Tactics

Twitter’s share price has remained in a steady uptrend since the 50-day SMA crossed above the 200-day SMA last summer. After a recent retracement to the 50-day SMA, the stock has regained upside momentum, with the MACD moving above its trigger line to generate a buy signal.

Active traders who buy here should look for an initial retest of all-time high (ATH) at $80.75, followed by a possible move higher. Protect against losses by placing a stop-loss order either beneath the 50-day SMA or under last month’s swing low at $59.28, depending on personal risk tolerance.

For a look at today’s earnings schedule, check out our earnings calendar.

Pfizer Trades Flat Amid Possible New COVID-19 Vaccine Deal with Israel

Shares in Pfizer Inc. (PFE) traded mostly unchanged Monday after the biopharmaceutical giant said it was in negotiations with Israel to supply additional COVID-19 vaccines. The discussions come five months after the drug manufacturer struck an initial deal to supply the Middle Eastern country with 8 million doses of its double-shot COVID-19 vaccine for a reported $785 million.

Israel, which currently leads the world in per-capita vaccinations, wants to secure an additional 36 million doses of the Pfizer/BioNTech vaccine. Officials say they hope to administer the extra vaccines to teenagers in the coming months and require further supplies to provide booster jabs.

“Pfizer has completed all deliveries to Israel under its initial agreement to provide its COVID-19 vaccine, signed in November 2020,” the company said in a statement cited by Barron’s. “The company is currently working with the Israeli government to update the agreement, to supply additional vaccines to the country.”

Through Monday’s close, Pfizer stock has a market value topping $200 billion and offers a healthy 4.3% dividend yield. Performance-wise, the shares trade slightly lower since the start of the year but have gained around 8% over the past year. From a valuation standpoint, the stock trades at 11.38 times projected earnings, just below its five-year average earnings multiple of 13 times.

Wall Street View

SVB Leerink analyst Geoffrey Porges lowered the investment firm’s price target on the stock to $39 from $40. However, he maintained his ‘Market Perform’ recommendation. Porges now sees full-year earnings coming in at $2.47 per share, a penny below his previous forecast of $2.46.

Most other analysts on Wall Street also have a “wait and see” approach to Pfizer. It currently receives 15 ‘Neutral’ ratings, 1 ‘Overweight’ rating, and 6 ‘Buy’ ratings. Monday’s $36.28 close represents a 7.5% premium to analysts’ 12-month median price target of $39.

Technical Outlook and Trading Tactics

Pfizer shares have remained in a steady uptrend since breaking above a multi-month trendline in early March. More recently, the price has consolidated within a pennant above the 200-day simple moving average (SMA). This indicates a continuation of the bullish momentum. Furthermore, the relative strength index (RSI) sits under the overbought threshold, giving price ample room to test higher prices.

Active traders who enter at these levels should look to book profits near the 2020 high at $43.08. Manage risk by placing a stop-loss order somewhere below the 200-day SMA.

For a look at today’s earnings schedule, check out our earnings calendar.

PayPal Shares Trade Flat Despite Launching Crypto Payments

PayPal Holdings, Inc. (PYPL) edged 0.37% higher Wednesday after the digital payments company launched its highly anticipated cryptocurrency checkout service.

U.S. customers who hold leading digital currencies Bitcoin, Ethereum, Bitcoin Cash, and Litecoin in their PayPal wallet will now be able to convert holdings into fiat currencies at participating merchants to make purchases. “This is the first time you can seamlessly use cryptocurrencies in the same way as a credit card or a debit card inside your PayPal wallet,” CEO Dan Schulman told Reuters.

The company, which plans a full rollout across its 29 million merchants within the coming months, first announced its foray into digital currencies late last year, initially only allowing users to buy, hold, and sell leading cryptocurrencies. The latest development comes within the same week that Tesla, Inc. (TSLA) CEO Elon Musk said U.S. customers can now purchase Tesla cars with Bitcoin and rival Visa Inc. (V) announcing that it facilitates settling transactions in USD Coin (USDC) – a stable coin backed by the U.S. dollar.

Through Wednesday’s close, PayPal stock has a market value of $277 billion and trades mostly flat since the start of the year. However, the shares have gained around 145% over the past 12 months. Valuation-wise, the stock looks a little pricey, trading 53% above its five-year average forward earnings multiple of 34 times.

Wall Street View

In January, BTIG analyst Mark Palmer upgraded PayPal to ‘Buy’ from ‘Neutral’ and placed a $300 price target on the shares. Palmer told clients that PayPal’s crypto initiative could add more than $1 billion to PayPal’s annual revenues in 2022. The analyst also argues that a shift to digital payments during the pandemic should continue in 2021 and propel the payment processer’s long-term growth trajectory.

Sentiment elsewhere on Wall Street remains bullish. The stock receives 35 ‘Buy’ ratings, 5 ‘Overweight’ ratings, and 7 ‘Hold’ ratings. Just one sell-side analyst recommends selling the shares. Twelve-month price targets range between $241 and $375, with the median pegged at $310.

Technical Outlook and Trading Tactics

Despite most analysts expecting further upside, the PayPal chart indicates short-term weakness that could see the shares fall. Over the first three months of the year, the stock has formed a head and shoulders pattern – a formation that often signals a top.

Active traders would be better to look for buying opportunities near $212.5, where the price finds a confluence of support from a multi-month horizontal trendline and the rising 200-day simple moving average (SMA). Those who buy at this level should target a move back up to the pattern’s head at $309.14. Protect capital with a stop-loss order placed below the psychological $200 level.

For a look at today’s earnings schedule, check out our earnings calendar.

3 Special Chemical Stocks Trading at an All-Time High

After a year of challenging conditions amid pandemic-driven shutdowns and slumping end-use market demand, specialty chemical stock investors finally have something to smile about.

The group has outpaced the S&P 500 by around 3% since the start of the year as economic data points to a turnaround in manufacturing activity. In March, the Institute for Supply Management’s Manufacturing Purchasing Managers’ Index (PMI) came in at 59, edging up from 58.6 in February. Moreover, a reading above 50 indicates an expansion in factory activity.

Below, we take a closer look at three specialty chemical stocks trading at an all-time high (ATH) and outline possible trading tactics using technical analysis.

Linde plc

With a market capitalization of $147.1 billion, Linde plc (LIN) produces and processes atmospheric gases, such as nitrogen, hydrogen, carbon dioxide, and helium. The chemical maker reported a Q4 profit of $2.30 per share on revenues of $7.27 billion. Analysts had expected EPS of $2.14 on sales of $7 billion.

Chart-wise, Linde shares broke out above a period of two-week consolidation Friday to register a new ATH at $281.88. Those who play the bullish momentum should consider using a moving average as a trailing stop. To do this, simply remain in the trade until the price closes below the indicator.

The Sherwin-Williams Company

The Sherwin-Williams Company (SHW) manufactures and sells premium paints, coatings, and related products to professional, industrial, commercial, and retail customers. Despite sluggish conditions in the last three months of 2020, the company grew its bottom line 19% from a year earlier. What’s more, the paint seller has topped Wall Street’s earnings forecasts for the past four consecutive quarters.

From a technical standpoint, Sherwin-Williams shares pushed through resistance Friday to print a new ATH at $760. Active traders who buy here should think about using a trailing bar stop to bank profits. To do this, place an initial stop-loss order beneath Friday’s low at $737.17 and raise it under the low of each higher price bar.

PPG Industries, Inc.

Pennsylvania-based PPG Industries, Inc. (PPG) produces paints, coatings, and specialty materials for customers in a variety of industrial end markets. The coatings specialist disclosed Q4 earnings of $1.59 per share, up from $1.31 in the year-ago quarter. Meanwhile, net sales increased roughly 2% year over year to $3.8 billion.

Turning to the charts, the price eclipsed its mid-January peak Friday to set a new ATH at $154.94, forging a cup and handle chart pattern in the process. Short-term traders could set an exit price by measuring the cup’s height and adding that amount to the pattern’s breakout point. For example, adding $20 to $152.20 for a profit target at $172.20.

For a look at today’s earnings schedule, check out our earnings calendar.

Amazon Appoints New Cloud Chief – Shares Tumble

Shares in e-commerce giant Amazon.com, Inc. (AMZN) slipped 1.61% Wednesday after the company announced it had hired Tableau CEO Adam Selipsky to head its AWS cloud business. Selipsky, a former Amazon executive, replaces Andy Jassy, who is taking over from founder Jeff Bezos as CEO later this year.

The appointment comes at a critical time as more companies continue to move from local storage to the cloud – a trend that has accelerated during the pandemic as remote working took hold during shutdowns. Currently, Amazon controls around 34% of the cloud market share according to Synergy Research Group, per the Wall Street Journal. Moreover, the company’s cloud division continues to drive earnings, bringing in $51 billion in annual sales last year and growing 30% in the fourth quarter. In total, the unit accounts for around 10% of Amazon’s revenue.

Through Wednesday’s close, Amazon stock has a market value of $1.56 trillion and trades nearly 60% higher over the past twelve months. However, the shares have eased 5.22% since the start of the year. From a valuation standpoint, the stock trades at about 61 times projected earnings – 41% below its five-year average earnings multiple of 86 times.

Wall Street View

Following the company’s upbeat fourth-quarter earnings report, Credit Suisse analyst Stephen Ju bumped the investment bank’s price target on the stock to $3,940 from $3,860. He also kept his ‘Maintain’ recommendation on the shares. Ju believes Amazon sits well-positioned to retain the customers it gained throughout the pandemic, which should drive faster purchasing velocity in the quarters ahead.

Bullish sentiment follows the stock elsewhere on Wall Street. It receives 44 ‘Buy’ ratings, five ‘Overweight’ ratings, and two ‘Hold’ ratings. Currently, the shares trade around $1,000 below analysts’ twelve-month consensus price target of $4,000.

Technical Outlook and Trading Tactics

Although no brokerage research recommends selling the shares, the chart indicates possible falls in the coming weeks. Since breaking down below a multi-month symmetrical triangle, the price has retested the pattern’s lower trendline in recent trading sessions, where previous support looks to be flipping into resistance. The area also encounters selling pressure from both the 50- and 200-day simple moving averages (SMAs).

Those who take a short sale at this level should consider covering their position on a decline to crucial support at $2,515. Protect capital by placing a stop-loss order just above the March 23 high at $31.82.

For a look at today’s earnings schedule, check out our earnings calendar.

Applied Materials Gains After Announcing $7.5 Billion Buyback

Applied Materials, Inc. (AMAT) shares rocketed 3.89% Monday after the Santa Clara chipmaker said it planned to undertake a new $7.5 billion share repurchase program.

The buyback, which represents around 7% of the company’s $109.5 billion market capitalization, supplements the $1.3 billion outstanding portion of its previous buyback program.

In other news, the company flagged that its Kokusai Electric share purchase agreement with KKR HKE Investment L.P. may fall through due to difficulty gaining regulatory approval in China. It told investors that if it fails to get the green light from Chinese authorities by March 26, it will terminate the deal and issue KKR a $154 million termination fee.

Through Monday’s close, Applied Materials stock yields 0.84% and has gained 214% over the past 12 months. Since the start of the year, the shares have added nearly 40%. From a valuation standpoint, the stock trades at 40% its five-year average forward earnings multiple of around 14 times.

Wall Street View

After the chipmaker reported better-than-expected Q4 results in mid-February, Cowen analyst Krish Sankar lifted the investment firm’s price target on Applied Materials to $140 from $120. He also maintained his ‘Overweight’ rating. Sankar believes the company’s product momentum, its market share gains, and operating margins should continue throughout the rest of 2021.

The sentiment also remains bullish elsewhere on Wall Street. The stock receives 21 ‘Buy’ ratings and four ‘Hold’ ratings. Currently, no brokerage research recommends selling the shares. Twelve-month price targets vary between $113 at the low end to $150 at the high end. The average target of $137 represents a 15% premium to Monday’s $119.33 closing price.

Technical Outlook and Trading Tactics

The Applied Materials share price has tracked steadily higher since late October. It finds a confluence of support from a multi-month uptrend line and the 50-day simple moving average (SMA). More recently, the price has oscillated within a symmetrical triangle as bulls and bears fight for control.

Active traders should consider buying if the stock breaks above the pattern’s upper trendline on above-average volume. As added confirmation, look for the breakout to coincide with a cross of the moving average convergence divergence (MACD) indicator above its signal line. In terms of trade management, place a stop-loss order somewhere below the triangle and target a move to around $143.50 (the height of the triangle added to the pattern’s top trendline).

AMAT Chart

For a look at today’s earnings schedule, check out our earnings calendar.