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.

AMC Entertainment Projects Most Cinemas to Reopen by March 26 – Shares Pop

AMC Entertainment Holdings, Inc. (AMC) shares added to Wednesday’s gains in extended-hours trade after the movie theater operator said that most of its U.S. cinemas will reopen by March 26. The announcement comes just hours after the Walt Disney Company (DIS) said it plans to open its California theme parks to a limited capacity on April 30.

Throughout the pandemic, movie theater chains have not only had to contend with shutting cinemas but also with filmmakers moving releases to video on demand or streaming services. During the fourth quarter, Disney decided to move its highly anticipated film “Soul,” produced through its Pixar animation studio, to its streaming service, Disney+.

However, in a much-needed boost for cinemas, the reopening of AMC theaters coincides with the release of the latest James Bond movie “No Time To Die,” which hits the big screen on April 2. The maker of Bond films – EON Productions Limited – delayed the release date several times over the past year to allow the film to be seen by a worldwide theatrical audience.

Through Wednesday’s close, AMC stock has a market capitalization of $6.81 billion and trades 539% higher since the start of the year – in part, due to a social media-induced speculation rally. In the past five days alone, the shares have gained nearly 40%.

Wall Street View

Riley Securities analyst Eric Wold raised the firm’s price target on AMC Entertainment to $7 from $5.50 and kept his ‘Neutral’ rating on the stock. Wold told investors in a research note that the company’s fourth-quarter sales came in ahead of expectations thanks to a stronger than anticipated performance at theaters and ongoing expense controls. The analyst also believes the movie operator sits well positioned to benefit from a box office rebound in 2022.

Coverage elsewhere on Wall Street remains thin, given the stock’s recent volatility. It currently receives five ‘Hold’ ratings and four ‘Sell’ ratings. Price targets range from a high of $7 to a low of just $1, with the average target pegged at $3.44.

Technical Outlook and Trading Tactics

AMC shares broke above an extended downtrend line in late January, rocketing up to $20.36 on social media trading speculation. However, the rally was short-lived, with the price subsequently retracing back to the downtrend line. More recently, the stock flipped resistance into support at that level and has continued to trend sharply higher.

Active traders who want to play short-term momentum should target a move back to the all-time high (ATH) while managing risk with a stop-loss order placed under the March 15 low at $11.85. Longer-term investors should look to buy the stock near an uptrend line connecting the January and February swing lows.

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

Nikola Slumps After Capital Raising Filing

Shares in electric truck maker Nikola Corporation (NKLA) tumbled 3.75% in extended-hours trade Monday after the company announced through an SEC filing that it plans to undertake a $100 million stock offering. According to the filing, Nikola intends to use the funds raised for general corporate purposes. The company said this may include completing its Arizona manufacturing facility and developing its commercial electric and fuel-cell commercial and hydrogen-station infrastructure.

Despite the company reporting a fourth-quarter loss that came in narrower than many analysts had expected (17 cent EPS loss vs. 24 cent loss), management disappointed investors by not providing further progress about how it’s traveling on turning EV truck designs into sales. The quarter was also marred by fellow automaker General Motors Company (GM) unwinding an equity stake in the company and exiting a partnership to build Nikola’s flagship Badger pickup truck.

Through Monday’s close, Nikola stock has a market value of $6.69 billion and trades over 50% higher over the past year. However, since the company’s latest earnings report on Feb. 25, the shares have shed 13.5%.

Wall Street View

Earlier this month, JPMorgan analyst Paul Coster downgraded Nikola to ‘Neutral’ from ‘Overweight,’ and trimmed his price target to $30, down from $33. The analyst said he thinks much of the good news is already built into the stock but noted that it may rally again later this year as the first fuel cell electric vehicle prototype becomes a reality.

Other analysts covering the stock want to see more from the company before committing to upgrades. Currently, it receives one ‘Buy’ rating and six ‘Hold’ ratings. Twelve-month price targets range from a Street-high $47 to $17 low. Meanwhile, Monday’s $17.06 close sits 49% below the median target price of $25.50.

Technical Outlook and Trading Tactics

Over the past six months, Nikola shares have found support at the crucial $14 support level after steep declines. The recent bounce from this closely watched area also coincides with a cross of the moving average convergence divergence (MACD) indicator to generate a buy signal.

Active traders who enter here should book profits on a move up to key overhead resistance at $29. Consider placing a stop-loss order beneath this month’s swing low at $14.05.

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

3 Regional Banking Stocks Gaining After House Passes $1.9 Trillion Relief Bill

Regional banking stocks have outpaced the broader stock market by nearly 30% so far this year as investors bet on a domestic recovery on the heels of a successful vaccine rollout and additional stimulus measures.

On the latter front, the group added to recent gains Wednesday after Congress passed a highly anticipated $1.9 trillion Covid relief bill that includes payments for small businesses and a $1,400 stimulus check for many Americans, as well as a $300 per week emergency unemployment benefit that extends through September.

Here are three leading regional bank stocks that active traders should consider adding to their watchlist.

KeyCorp

With assets over $150 billion, KeyCorp (KEY) provides a variety of financial services in 16 states, with a key focus on Ohio and New York. The Cleveland-based bank grew its bottom line 24% from a year earlier in the fourth quarter, driven by higher loan balances and lower provisions. As of March 11, 2021, the shares offer a healthy 3.62% dividend yield and trade 28.95% higher on the year.

From a chart perspective, the price has formed a pennant pattern near the December 2019 high. Those who buy at current levels should use a trailing stop – such as a 15-day SMA – to let profits run.

SVB Financial Group

Headquartered in Santa Clara, SVB Financial Group (SIVB) offers a range of banking services through four segments: Global Commercial Bank, SVB Private Bank, SVB Capital, and SVB Leerink. The bank disclosed Q4 adjusted earnings of $7.40 per share on revenues of $1.21 billion, with both metrics coming in ahead of Wall Street forecasts and growing 46% and 43%, respectively, from the December 2019 quarter. Although SVB Financial stock does not issue a dividend, it has returned 36.43% since the start of the year as of March 11, 2021.

From a technical standpoint, traders who use the current retracement as a buying opportunity should place an initial stop under the recent swing low and trail it higher as the uptrend continues.

PNC Financial Services Group, Inc.

The PNC Financial Services Group, Inc. (PNC) operates as a diversified financial services company, providing its customers with everything from corporate and institutional banking to asset management. The company, which has 2,300 branches in 21 states and the District of Columbia, posted Q4 earnings per share (EPS) of $3.26, comfortably ahead of the $2.65 analysis had expected. Moreover, the bottom line improved 10% from the year-ago period, benefiting from a decline in expenses and a recapture of provisions. As of March 11, 2021, the stock yields 2.65% and has gained nearly 20% year to date (YTD).

Chart-wise, a pennant that has formed over the past few weeks indicates a continuation of the current uptrend. Traders who buy could use the measured move technique to book profits. To do this, calculate the distance – in dollars – of the leg that proceeded the pattern, and add that amount to the pennant’s top trendline. For example, add $38.90 to $179 for a target of $217.90.

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

GameStop Surges After Tapping Tech Tycoon to Lead Digital Shift

GameStop Corp. (GME) shares closed Monday’s regular session up 41.21% after the videogame retailer announced that it had appointed Chewy co-founder Ryan Cohen to spearhead an e-commerce transition.

Cohen – a board member and major shareholder – has actively pushed management in recent months for a strategic shift away from traditional brick-and-mortar sales. “Through our private conversations, we have explained to Mr. Sherman [CEO] and the Board that GameStop has the ability to pivot toward becoming a technology-driven business that excels in the gaming and digital experience worlds,” Cohen outlined in a letter late last year.

The company, which has had its stock become subject to wild social media-driven speculation in recent months, said that it has established a new “Strategic Planning and Capital Allocation Committee” lead by Cohen to identify ways to accelerate its digital transformation. Since the committee was formed, the company has hired former Amazon Web Services engineering lead Matt Francis as chief technology officer and two other executives tasked with overseeing GameStop’s e-commerce and customer service functions.

The strip mall retailer has seen sales plunge in recent years as customers shift toward digital downloads and videogame streaming services, such as Nvidia GeForce Now, PlayStation Now, and Google Stadia. As of March 9, 2021, GameStop stock has a market capitalization of $13.57 billion and trades nearly 1,000% higher since the start of the year. In the past month alone, the shares have rallied over 200%.

Wall Street View

In late January, Telsey Advisory analyst Joseph Feldman downgraded the shares to ‘Underperform’ but lifted his price target to $33 from $22. Feldman said he sees a “disconnect” between GameStop’s fundamentals and its valuation following the recent surge in the share price.

Other brokerage firms have been reluctant to provide coverage of the stock given its recent market speculation and volatility. Currently, it receives 4 ‘Hold’ ratings, 1 ‘Underweight’ rating, and 3 ‘Sell’ ratings. Through Monday’s close, GameStop stock trades at a 489% premium to Feldman’s $33 twelve-month price target.

Technical Outlook and Trading Tactics

Despite the lack of brokerage coverage, the stock continues to provide opportunities for active traders who have higher risk tolerance. In recent price action, the shares have maintained their sharp advance, with the stock nearly closing the Feb. 2 gap.

Those who want to capitalize on the bullish momentum should target a move back to the all-time high (ATH) at $483 while managing the downside with a stop-loss order placed somewhere under the weekly low at $146.10. Longer-term value investors should look for entries on retracements to a multi-month uptrend line that finds a confluence of support from the 200-day SMA.

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

Hewlett Packard Enterprise Tops Earnings Forecasts, Ups Full-Year Guidance

Hewlett Packard Enterprise Company (HPE) traded mostly unchanged in Tuesday’s extended-hours session despite the enterprise-computing hardware company surpassing Wall Street expectations and raising its full-year forecast.

The company posted a fiscal Q1 profit of 52 cents per share while analysts had expected earnings of 40 cents a share. Moreover, the bottom line grew 18% from a year earlier. Sales of $6.83 billion also came in ahead of Street forecasts but were down from revenues of $6.95 billion reported in the same quarter last year.

Looking ahead, management now expects FY 2021 earnings to range between $1.77 and $1.80 a share, up from its previous forecasts of $1.60 to $1.78. CEO Antonio Neri told Barron’s that the company saw a recovery in enterprise IT spending throughout the quarter, adding that he anticipates demand gradually resuming this year.

As of March 3, 2021, Hewlett Packard has a market value of $18.86 billion, issues a healthy 3.29% dividend yield, and trades 22.36% higher year to date (YTD). Over the past 12 months, the shares have gained 12.5%. Valuation wise, the stock trades at nearly nine times projected earnings, slightly below its five-year average multiple of 9.65 times.

Wall Street View

In January, JPMorgan analyst Paul Coster upgraded HP Enterprise to ‘Overweight’ and lifted his price target to $16 from $13. Coster told investors the stock was a good “contrarian long trade,” given the company’s move into the SD-WAN space, its ongoing cost-cutting initiatives, and the expected recovery in enterprise IT spending.

Most other analysts have a wait-and-see view on the stock. It receives 13 ‘Hold’ ratings, 5 ‘Buy’ ratings, and 1 ‘Sell’ rating. Twelve-month price targets range from a Street-high $18 to a low of $10. The median target sits at $14 – 3.4% below Tuesday’s closing price of $14.50.

Technical Outlook and Trading Tactics

Since bottoming out around $8 a share in late October, the share price has trended sharply higher. More recently, traders have booked profits ahead of the company’s quarterly earnings. This provides a “buy the dip” opportunity for active traders.

Look for entry points at the $14 level, where the price finds support from a four-month uptrend line. In terms of trade management, consider placing a stop-loss order beneath the 50-day simple moving average (SMA). Think about booking profits on a retest of pre-pandemic high at $17.59.

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

Foot Locker Runs Into Sellers as Sales Miss Forecasts

Shares in Foot Locker, Inc. (FL) plunged 8.8% Friday after the shoe seller posted mixed quarterly results wherein sales fell short of Wall Street expectations.

The mall-based retailer disclosed fourth quarter (Q4) revenues of $2.22 billion, with the figure missing analysts’ expectations by 0.71% and coming in below year-ago sales of $2.27 billion. Investors were also troubled by the company’s comparable store sales, which slumped 2.7% during the quarter versus expectations of a 4.9% increase. Foot Locker still has around 10% of its stores closed due to the pandemic.

In better news, the company’s bottom line grew 4.5% from a year earlier, helped by a 44% jump in online sales and improved margins. “Our digital business remained the catalyst through the quarter, delivering impressive double-digit growth overall with strengths across the board. In regions most heavily impacted by store closures, digital growth was up triple-digits. In fact, in Europe, COVID-related restrictions have been an accelerator for digital capability and growth,” CEO Dick Johnson told investors, per Yahoo! Finance.

Through Friday’s close, Foot Locker stock has a market capitalization of $5 billion, offers a 1.66% dividend yield, and trades up 18.92% on the year. Over the past 12 months, the shares have gained over 40%.

Wall Street View

Last month, Cowen analyst John Kernan upped the investment firm’s price target on the stock to $66 from $55 while keeping his ‘Outperform’ recommendation. Kernan believes expectations are too low and valuation appears too cheap given ongoing government stimulus measures designed to encourage consumer spending.

Brokerage coverage elsewhere also remains mostly bullish. The stock receives 14 ‘Buy’ ratings, 7 ‘Hold’ ratings, and just 1 ‘Sell’ rating. As of March 1, the stock trades at a 15% discount to Wall Street’s 12-month median price target of $55.50.

Technical Outlook and Trading Tactics

Foot Locker shares have remained in a steady uptrend since bottoming out at the height of the March 2020 pandemic sell-off. Furthermore, a cross of the 50-day simple moving average (SMA) above the 200-day SMA in late September – referred to as a “golden cross” – confirmed the bullish price action.

Active traders should view the current earnings-driven weakness as a buying opportunity. Look to enter near $46, where the price finds a confluence of support from a multi-year trendline and the 50-day SMA. Those who take a trade should consider placing a stop-loss order under the January swing low at $42.69 and targeting a move to crucial overhead resistance at $64.

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