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Stock Market Today: Dow Jones, S&P 500 Opened Higher; Coinbase Stock Slides After Earnings Report

Markets open in green today despite hotter-than-expected inflation data
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Stock Market Today Mid-Morning Updates

On Wednesday, the Dow Jones Industrial Average is up by 220 points after the first of two key inflation reports this week showed that consumer prices were still at its highest levels since the 1980s. President Joe Biden says that he will consider dropping some of the tariffs imposed against Chinese imports to help control rising consumer prices in the U.S, a tariff from the Trump administration. The White House is reviewing penalties on items like diapers to clothing and furniture.

Shares of Wendy’s (NASDAQ: WEN) were down by over 10% on today’s opening bell after it missed its first-quarter earnings. The company is seeing headwinds from higher costs for supplies and labor. Also, Roblox (NYSE: RBLX) was up today despite posting a wider-than-expected loss for its latest quarter. It also says that it expects losses to continue in the short term as expenses rise and pandemic-induced demand subsides. Luxury goods retailer RealReal (NASDAQ: REAL) is down today despite reporting better-than-expected sales.

Among the Dow Jones leaders, shares of Apple are down by 0.87% today while Microsoft (NASDAQ: MSFT) is also down by 0.50%. Meanwhile, Disney (NYSE: DIS) and Nike (NYSE: NKE) are trading higher on Wednesday. Among the Dow financial leaders, Visa (NYSE: V) is up by 0.85% while JPMorgan Chase (NYSE: JPM) is also up by 1.68%.

Shares of EV leader Tesla (NASDAQ: TSLA) are down by 1.53% on Wednesday. Rival EV companies like Rivian (NASDAQ: RIVN) are also down by 3.73%. Lucid Group (NASDAQ: LCID) is also down by 2.89% today. Chinese EV leaders like Nio (NYSE: NIO) and Xpeng Motors (NYSE: XPEV) are trading higher today. 

Dow Jones Today: U.S. Treasury Yields Rises After Consumer Price Index Comes In Red Hot

Following the stock market opening on Wednesday, the S&P 500, Dow, and Nasdaq are trading higher at 0.57%, 0.73%, and 0.04%. Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (NASDAQ: QQQ) is up by 0.11% while the SPDR S&P 500 ETF (NYSEARCA: SPY) is also up by 0.57%. 

The benchmark 10-year U.S. Treasury yield surges above 3% on Wednesday after the government’s April consumer price index rose more than expected at 8.3% year-over-year. Excluding volatile food and energy prices, core CPI still rose more than expected as well at 6.2%. Inflation seems to be the biggest threat to an economic recovery that began early in the pandemic. Oil prices are also seen as a source of inflation in the economy. West Texas Intermediate crude, for instance, is up by over 3% today at $103 per barrel. 

[Read More] Top Stock Market News For Today May 11, 2022 

Coinbase Stock Slips After Falling Short Of Earnings Estimates And Declining Revenue

Coinbase (NASDAQ: COIN) appears to be feeling the heat during this earnings season. After yesterday’s closing bell, the posted less-than-ideal results in its quarterly financial update. In brief, the crypto exchange platform operator posted a loss of $1.98 per share on revenue of $1.17 billion. Regarding revenue, Coinbase is noticeably short of Wall Street’s projections of $1.48 billion. Year-over-year, the company’s total revenue is down by 27%. Namely, this is likely due to the recent series of sell-offs in the crypto market over the past few months.

Just earlier this week, Bitcoin (BTC) hit a multi-month low after dipping below the $30,000 mark. This movement alongside the current volatility in the broader stock market would, in theory, impact Coinbase’s bottom lines amidst lower trading volume. In fact, Coinbase’s retail monthly transaction users (MTUs) are down by 23% quarter-over-quarter. At the same time, the company’s total trading volume is also seeing a decline from $547 billion to $309 billion over the same period.

Nevertheless, the company had this to say about its overall trajectory now. “While we continue to invest and enhance our core investment platform, the application era of crypto is upon us, led by NFDs and decentralized finance, and we are increasingly focusing our efforts on these market opportunities.” Time will tell if this can translate to long-term sustainable growth for COIN stock.

COIN stock
Source: TradingView

[Read More] Best Stocks To Invest In 2022? 4 Software Stocks For Your List

Unity Stocks Slumps Towards New 52-Week Lows Following Revenue Miss And Disappointing Outlook

Another head-turner in the stock market today would be Unity Software (NYSE: U). Evidently, U stock is currently trading towards new 52-week lows at today’s opening bell. As it stands, the company’s shares are looking at losses of over 25% now. By and large, this seems to also be a result of its latest financial release. For starters, Unity reported a loss per share of $0.08 alongside revenue of $320.13 million. For reference, this is in comparison to consensus analyst estimates of a $0.08 loss per share and revenue of $321.17 million. Overall, Unity’s results are somewhat as expected by Wall Street. However, the real reason behind U stock’s steep decline today could be its growth outlook.

For now, the company is expecting a total revenue of between $290 million to $295 million for the current quarter. To point out, this is significantly lower than consensus Wall Street targets of $359.65 million. Also, this represents a 6% year-over-year jump for Unity on this front. Moreover, the company’s full-year revenue guidance is now at $1.35 billion to $1.45 billion. This would make it just shy of current analyst forecasts of $1.49 billion. 

Even as the company provides more conservative growth estimates, its current momentum could be worth considering. Speaking on this in further detail is CEO John Riccitiello. He highlights, “Unity delivered record quarterly revenue in the first quarter of 2022, the highest in the company’s history … with Create over-performing at 65% year-on-year growth.” All this, according to CFO Luis Visoso, is thanks to Unity actively growing its customer base across new industries while expanding its business with existing clients. As such, some would argue that U stock could be worth considering in the stock market now.

U stock
Source: TradingView

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The post Stock Market Today: Dow Jones, S&P 500 Opened Higher; Coinbase Stock Slides After Earnings Report appeared first on Stock Market News, Quotes, Charts and Financial Information | StockMarket.com.

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Economics

Why You Shouldn’t Worry About Costco Stock

The warehouse club’s shares have been falling, but investors have nothing to worry about.

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The warehouse club's shares have been falling, but investors have nothing to worry about.

The market crash has driven stocks into a bear market panicking many investors as strong companies with solid results see their shares tank. It's a market that seems to have no safe havens as the vague specter of inflation has cast a dark shadow over the entire market, but pandemic stocks, technology companies, and the entire retail sector.

Costco (COST) - Get Costco Wholesale Corporation Report has not been immune to the drop. Despite the warehouse club operating pretty much as it always has, steadily adding members while retaining existing members, the chain has seen its share price fall 22.83% in the past six months.

That's a big drop for a chain which has been a very steady stock, usually moving upward while also paying a dividend. Costco's share price drop, however, has nothing to actually do with the company's performance. Instead, the company has fallen victim to broad concerns about retail in general.

Target (TGT) - Get Target Corporation Report, for example, saw its shares lose over 25% in value after it reported first quarter results. The chain grew its same-store sales, which was impressive given that it had seen that metric rise by 22.9% in previous-year quarter. The retailer faltered when it came to profits as earnings were cut in half year-over-year due to rising costs and supply chain issue.

Never mind that Wall Street has taken Target's strength for weakness (making money and gaining customers under these conditions is impressive), Costco shareholders have even less to be worried about.

Ting Shen/Xinhua via Getty

Why Is Costco So Strong?

Retail stocks, including Target and Costco, have suffered due to rising prices (inflation), supply chain issues, and fears over consumer spending drops. These are real concerns, but Costco has a lot of protection from those issues. The warehouse club operates on a membership model. Its profits come largely from selling memberships, not on the goods its sells its members.

Costco offers members the promise of low prices in exchange for a membership fee. The company offers a limited selection to keep prices down and it has enormous bargaining power with suppliers.

It's possible that inflation will drive prices higher on some key Costco items, but they company can simply pass those increase on without adding a markup. That makes the chain a value proposition for shoppers as these factors impact all retailers.

Costco has been able to hold its own on gross margin, according to CFO Richard Galanti speaking during the company's second-quarter earnings call.

"Moving down to the gross margin line. Our reported gross margin in the second quarter was lower year over year by 32 basis points but up 5 basis points, excluding gas inflation," he said.

Basically, aside from gas -- which is generally cheaper at Costco than anywhere else -- the company maintained its margin. It also grew its same-store sales by 11.1% excluding gas while its income rose as well.

"Net income for the quarter came in at $1.299 billion or $2.92 per diluted share. Last year's second quarter net income came in at $951 million or $2.14 per diluted share," Galanti shared.

Membership Is Costco's Key Metric

 Unlike a traditional retailer, sales aren't the key metric for Target. Membership tells investors more about the health of the company than anything else. The warehouse club needs both retain members and add new ones.

 It has done that, according to Galanti.

"In terms of renewal rates, they continue to increase. At second quarter end, our U.S. and Canada renewal rate stood at 92%, up 0.4 percentage point from the 12-week earlier at Q1 end. And worldwide rate, it came in at 89.6%, up 0.6% from where it stood 12 weeks earlier at Q1 end," the CFO shared.

Costco has seen its renewal rates go up as more members auto-renew. The warehouse club has also seen more of its members opt for the higher-priced Executive Membership, " who, on average, renew at a higher rate than non-Executive members," Galanti shared.

Membership has been growing (as it steadily has) as well, according to the CFO.

In terms of the number of members at second quarter end, member households and total cardholders, total households was 63.4 million, up 900,000 from the 62.5 million just 12 weeks earlier; and total cardholders at Q2 end, 114.8 million, up 1.7 million from the 113.1 million figure 12 weeks ago. At second quarter end, paid Executive Memberships stood at $27.1 million, an increase of $644,000 during the 12-week period since Q1 end. Executive Members, by the way, represent now 42.7% of our total membership base and 70.9% of our total sales.

So, while Costco's share price has suffered due to broader concerns and general market panic, the chain's business has not suffered. In a terrifying environment for investors, you could argue that Costco's one of the safer bets as long as you're willing to be patient.

In the short-term, stock prices may not reflect actual business results. Over time, however, the warehouse club will go back to posting steady share gains while also paying a dividend (and perhaps offering a bonus special dividend).   

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Stocks

Hot Biotech Penny Stocks to Watch as Stocks Enter Bear Market 

Are these biotech penny stocks on your watchlist right now?
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3 Hot Biotech Penny Stocks to Add to Your Watchlist With the Market Down 

Recently, biotech penny stocks have seen heightened bullish sentiment. Today, the emphasis on biotech stocks comes as the Monkeypox virus is seeing a resurgence in certain areas around the world. Today, the WHO confirmed 80 cases of the virus in 11 countries. And since then, investors have begun looking for biotech stocks that may be able to benefit. 

[Read More] Penny Stocks To Buy Now? Hot Monkeypox Stocks To Watch Today

In addition to this, we are also seeing heightened volatility with penny stocks and blue chips. This means that it is more important than ever to stay on your toes. Understanding what your trading strategy is and how you can best execute it is crucial in these market conditions.

If you are thinking about getting into penny stocks, then make sure to do your research first. There is a lot going on in the stock market, so researching and understanding all you can about penny stocks is essential to your success. With this in mind, let’s take a look at three biotech penny stocks to add to your watchlist right now. 

3 Biotech Penny Stocks to Add to Your Market Crash Watchlist 

  1. Immix Biopharma Inc. (NASDAQ: IMMX
  2. TherapeuticsMD Inc. (NASDAQ: TXMD
  3. Chimeric Inc. (NASDAQ: CMRX

Immix Biopharma Inc. (NASDAQ: IMMX) 

One of the bigger gainers of the day is IMMX stock. At EOD, shares of IMMX stock shot up by over 30%, with a 5% gain in after hours trading. And, in the past five day period, shares of IMMX have climbed by more than 50%.

While we do see many gains with penny stocks without news, today, Immix made an exciting announcement in premarket trading. The company stated that its IMX-110 drug demonstrated improved survival over the current approved drug, Trabectedin. It states that IMX-110 is part of what is expected to be a $6.5 billion market by 2030. 

“We are excited to see continued evidence of IMX-110 anti-tumor activity versus approved therapies. We believe this is a preview of anti-tumor activity to be demonstrated in our 2 clinical trials to be kicked-off in 2022: IMX-110 monotherapy, and IMX-110 in combination with anti-PD-1 tislelizumab.”

The CEO of Immix Bio, Ilya Rachman

Right now, there is quite a lot of bullish sentiment with biotech penny stocks. And, as a clinical stage biopharmaceutical company, Immix is at the center of this. While it is highly volatile IMMX stock could be worth adding to your list of penny stocks to watch. 

TherapeuticsMD Inc. (NASDAQ: TXMD) 

Another gainer of the day on May 20th is TXMD stock, which shot up by over 35%. In the past month, shares of TXMD stock have fallen by around 74%, which makes this gain much more substantial.

[Read More] Penny Stocks To Buy? Warren Buffett’s Bitcoin Bet, 3 Stocks To Watch

Today, the company announced that it received FDA approval for its Supplemental New Drug Application for Annovera. With this approval, the company will be able to produce 7,000 additional rings for the supply chain, which will be made available to customers by the second and third quarter of this year. 

“Today’s approval is an important milestone as it will allow us to more efficiently scale, manufacture, and consistently supply ANNOVERA to meet the increasing demand by women who want procedure-free, long-lasting reversible birth control.” 

The CEO of TherapeuticsMD, Hugh O’Dowd

Back in 2018, Annovera was approved by the FDA as a long-lasting, reversible, procedure-free birth control product. And since then, the company has worked hard to commercialize it as much as possible. With that in mind, do you think TXMD is a worthwhile add to your penny stocks watchlist or not?

Penny_Stocks_to_Watch_TherapeuticsMD

Chimeric Inc. (NASDAQ: CMRX) 

With an over 6.8% gain at EOD on May 20th, CMRX stock is another penny stock that investors are watching right now. In the past five days, we’ve seen a very steady gain with CMRX stock, pushing up by more than 20%, which is no small feat. And, this comes after a six month drop of over 60%.

The main reason for today’s gain with CMRX stock comes as fears surrounding an increase in Monkey Pox cases, are driving up biotech stocks. This includes Chimeric, which recently announced a deal with Emergent, to offer exclusive rights for its smallpox oral antiviral product known as Tembexa. 

And, given that Monkey Pox is a smallpox derivative virus, we see the major correlation between the two. With this new virus situation, there is a large demand increase for this vaccine. And while the fears that are comparing this virus to Covid-19 are somewhat unwarranted, there is a lot to consider. With this in mind, does CMRX deserve a spot on your buy list or not?

Penny_Stocks_to_Watch_Chimeric

Which Penny Stocks Are You Watching Right Now?

Finding the best penny stocks to buy is all about understanding where to look. While it can be difficult given the heightened volatility in the stock market right now, there are some ways to make it easier. The best course of action will always be to have a well-thought-out trading strategy on hand. 

[Read More] What to Know About Buying Penny Stocks on May 20th 

 This can help you to maximize your chance of profitability and increase your odds of not seeing losses. In addition, considering exactly what is going on in the stock market remains paramount to your success as an investor. So, as we continue to traverse this extremely volatile period, which penny stocks are on your watchlist right now?

[reblex id='29520']

The post Hot Biotech Penny Stocks to Watch as Stocks Enter Bear Market  appeared first on Penny Stocks to Buy, Picks, News and Information | PennyStocks.com.

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Spread & Containment

Why I’m Not Worried About the Stock Market Crash

In the long run, the stock market always goes up (but it’s way more complicated than that).

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In the long run, the stock market always goes up (but it's way more complicated than that).

We're not living in 1929. It's important to remember that as we watch the stock market crash and our personal net worth take a big hit.

While that has certainly happened, it's important to note that the stock market isn't the economy. We're not on the cusp of the next Great Depression. Instead, we have a market that's spooked by rising inflation (i.e. stuff costing more) that's also struggling with supply chain issues caused by an unparalleled global pandemic.

Yes, many things cost more including basic needs like food and shelter, as well as near-basic needs likes cars and gas. But, while inflation has been real, that's not the full story of the U.S. economy.

We're also living at a time where the unemployment rate (3.6%) remains near historic low (where it most likely would be if jobs weren't so plentiful allowing some people to sit out of the labor market for a period). The labor picture has for a very rare time in American history titled in favor of workers.

This has led to jobs in the retail and service space which once paid minimum wage while offering minimal benefits to offer $15 an hour or more along with perks like free college tuition. That's not to say that these jobs even pay a living wage (it depends a lot upon where you live) but the situation for workers in these spaces has notably improved.

The economy has its struggles, but it's not a clear picture. High house prices for one person means a home that has gained a lot of value for someone else. And other issues -- like the high cost of gas and the shortage of new as well as used cars -- are tied to relatively short-term problems.

statista

But What About My Investments?

Stock markets crash. That's sometimes an indication of greater economic problems, but the U.S. stock market has never failed to recover its losses -- often in a fairly quick period. That's cold comfort as you see red in your portfolio, but if retirement (or whatever you plan to spend your invested money on) isn't now or in the next year or two, a "crash" is something expected that can be used to your advantage.

The first thing you should do is evaluate why you own the shares that you own. Has something changed about any of those companies because of the pandemic? Not has the share price gone down, but has anything changed about the company's long-term trajectory?

Short-term investors, or perhaps people who panic easily, have used Netflix's (NFLX) - Get Netflix, Inc. Report slight subscriber drop as a sign that the company has peaked. Do you believe that or do you see the streaming leader both returning to growth and better controlling its content costs?

Netflix had explosive growth during the pandemic. Would you have rather it added those customers at a pace that spread things out for Wall Street? Do you see people leaving the service for a rival or to start reading more?

The reality is that many high-quality companies have suffered major declines for reasons that have nothing to do with their business performance. Yes, the pandemic did create some false winner that won't be long-term successes, but that's a small number of companies (and many long-term investors avoided those companies because of that possibility.

Now Is the Time to Buy

The stock market has become a giant Marshalls filled with name brands at huge discounts. It may seem counterintuitive to buy while stocks are crashing, but isn't that the best time to buy? If your BMW dealer has too much inventory and offers a sale, that doesn't change the long-term value of owning a BMW.

And while buying can be a huge opportunity, the reality is that a market crash is not the time to sell (unless you truly believe you have a holding that's not a good long-term investment). Yes, a lot of high-fliers have fallen to earth, but that was true in 2008 as well and history has shown that holding and buying great companies when prices are low is how you get rich.

Daniel Kline is Managing Editor of TheStreet.com

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