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💸 Buy Now, Profit Later?
Plus, Trump and Biden finally agree on something...
Happy Monday afternoon to everyone on The Street. Here's a snapshot of where markets ended the trading session, plus tomorrow's trade idea delivered to you today.
🟩 | US stocks climbed Monday as investors bought the dip after Wall Street's worst week of the year, with the Dow, S&P 500, and Nasdaq all rising 1.2% as hopes for a Federal Reserve rate cut boosted sentiment.
📈 | One Notable Gainer: Palantir shares surged 14% on Monday, reaching their highest level since early 2021, following the announcement that the stock will be added to the S&P 500.
📉 | One Notable Decliner: Shares of Life360 dropped 10% following news of Emerald Advisers LLC acquiring a new stake in the company during the second quarter, as reported in its latest SEC filing.
💸 | Tomorrow's Trade: Buy Now, Profit Later? Affirm Thinks So! Scroll down for more.
Plus, a new study says this day is the best day to trade TSLA shares…
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TOGETHER WITH TRADINGPUB
Thanks to a new discovery linked to shares of Tesla, regular folks can now target year's worth of Tesla returns in six days or less. The next opportunity is scheduled for this Thursday
S&P 500 Heatmap. Credit: Finviz
All Stock Heatmap. Credit: Finviz
Global ADR snapshot. Credit: Finviz
MARKET MOVERS
DELL (+4%) Palantir and Dell Will Join S&P 500—What You Need To Know (Investopedia)
JBLU (+7%) JetBlue upgraded to Neutral by BofA Securities, stock jumps (Yahoo Finance)
BA (+3%) Boeing's shares rise after tentative labor deal that could avert major strike (Reuters)
X (+5%) U.S. Steel deal faces changing politics (Axios)
SMMT (+56%) Lung Cancer Drug Trial News Has Summit Therapeutics Stock Up 40% Today (Investopedia)
OVERHEARD ON THE STREET
CNBC: Apple unveiled the iPhone 16, new Apple Watches, and AirPods at its "Glowtime" event, with preorders starting Friday before the Sept. 20 launch.
Axios: Salesforce will acquire New Jersey's Own Co. for $1.9 billion, marking its largest deal since Slack and signaling a return to major acquisitions..
AP: A month after being labeled an illegal monopoly, Google faces a new antitrust suit over its ad tech, with a federal judge hearing arguments.
WSJ: Eli Lilly appointed Lucas Montarce as CFO to replace Anat Ashkenazi, who moved to Alphabet as CFO earlier this year.
Reuters: Panasonic Energy has completed preparations for mass-producing high-capacity EV batteries and plans to begin supplying automakers.
TOMORROW’S TRADE IDEA, TODAY
‘Buy Now, Pay Later’ Could Soon Pay Off
Milestone on the Horizon
The high interest rate environment of the last several years has put a dent in consumer spending, and many companies that rely on it. But for one, at least, that may be poised to turn around.
Affirm (AFRM) is set to achieve positive operating income in Q4 of its FY 2025. With the Federal Reserve set to cut rates in the near future, while the lender’s core profitability at today’s rates remains strong, this elusive milestone could finally be on the horizon for Affirm.
Triple Tailwinds
On a call with analysts, CEO Max Levchin suggested interest rate cuts won’t just make borrowing less expensive. A lower benchmark rate should also allow Affirm to approve more people for loans, which could result in more active and repeat users.
The company’s chief highlighted other tailwinds too. Revenue as a percentage of gross merchandise volume has been above 9% for the last two quarters, while revenue less transaction costs accounted for 4.3% of volume last quarter. That was the highest quarterly rate in two years.
Hidden Upside
Affirm projects its gross merchandise volume to grow 26% to $33.5 billion in FY 2025, up from $27 billion this fiscal year.
Analysts are giving it an average rating of Hold and a price target of $40.54, which is only a slight upside from today’s prices. But this may be pricing in the persistent possibility of a hard landing, which would deal a substantial blow to lenders and borrowers alike.
If the Fed achieves its goal of a soft landing, Affirm’s hidden upside may be much higher.
Are you bullish or bearish on Affirm (AFRM) over the next 12 months? |
TOGETHER WITH TRADINGPUB
Thanks to a new discovery linked to shares of Tesla, regular folks can now target year's worth of Tesla returns in six days or less. The next opportunity is scheduled for this Thursday
ON OUR RADAR
CNN: DirecTV is paying customers to switch to rival services during a Disney dispute that might black out tonight’s “Monday Night Football.”
Reuters: The NHTSA is investigating over 781,000 2021-2023 Jeep Wrangler and Gladiator SUVs after nine reports of fires, mostly with the ignition off.
CNBC: Huawei’s Mate XT trifold smartphone has garnered over 2.7 million pre-orders since launching on Saturday, ahead of Apple’s iPhone 16.
BI: Trump and Biden both propose a US sovereign wealth fund to boost technology, energy, supply chains, and reduce national debt.
CNBC: Big Lots filed for Chapter 11 bankruptcy due to high interest rates and weak housing demand, agreeing to sell to Nexus Capital for $760M.
FRIDAY’S POLL RESULTS
🟩🟩🟩🟩🟩🟩 🐂 Bullish
🟨⬜️⬜️⬜️⬜️⬜️ 🐻 Bearish
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