Happy Sunday to everyone on The Street.

I hope you all had a good week! Unfortunately, this week was especially good for the hacking group ShinyHunters.

ShinyHunters announced they stole data from two massive companies on Thursday and Friday:

• Ticketmaster reported that the hacking group stole the personal details of 560 million of its customers. ShinyHunters is demanding $500,000 to prevent the data from being sold to other parties.

  • Ticketmaster has now been hit with a class action lawsuit for failing to protect its consumers’ information.

• Santander Bank was hacked as well, and the confidential information of all of the bank’s staff, and its 30 million customers was stolen.

  • The customers’ private data, including bank and credit card numbers, was put up for sale by ShinyHunters for $2 million.

With two high-level hacks within days, it’s only reasonable to think that modern cybersecurity is in desperate need of an upgrade. One potential fix could come from the crypto world, specifically with blockchain.

Blockchain networks are decentralized, meaning data is not stored in a single location for hackers to break into. However, blockchain isn’t a perfect solution. It faces scalability issues and requires widespread adoption to truly be effective.

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Make the Wright Call

Playing the “Nuclear Renaissance”

Curtiss-Wright Corp (CW) is up around 25% this year and roughly 75% over the last twelve months, and Morgan Stanley (MS) sees more growth ahead. 

The manufacturer creates pieces of infrastructure used to supply nuclear plants. For example, it makes reactor coolant pumps crucial for certain plants to operate.

Morgan Stanley has a $330 price target for Curtiss-Wright, which gives it an upside of around 20%.

This Time, It’s Different

A big reason for the confidence in Curtiss-Wright is Morgan Stanley’s observation that the world is experiencing a nuclear renaissance. 

If more countries invest in nuclear power, that leads to more plants requiring parts to get up and running. 

Analysts at the bank acknowledge that investors were wrong 15 years ago when they expected an emerging nuclear renaissance. They argue that this time, the expectation is well-placed.

Morgan Stanley noted that electricity demand is booming and Russia’s invasion of Ukraine is motivating European countries to look to nuclear energy.

More Nuclear, More Money

Curtiss-Wright makes a reactor for Westinghouse’s third-generation AP1000 nuclear plants. Morgan Stanley’s base case shows Westinghouse winning half of the contracts for new plants in Europe which would be a win for CW.

In the bank’s bull case, Curtiss-Wright’s revenue surges to $4.9 billion through 2050 on blossoming nuclear demand. The bull case price target is about 75% higher than the stock’s current levels. 

Seven analysts are covering Curtiss-Wright, and four recommend it with a buy rating. 

Morgan Stanley is the biggest bull of the bunch, and the bank could look smart if a nuclear renaissance delivers as expected.

Hard Times for Hardware Stores

A Rough First Quarter

On a recent earnings call, Home Depot (HD) CFO Richard McPhail admitted that inflation is taking a toll on the hardware business. He said high interest rates and the Fed’s indication that they will soon come down are causing customers to put off large projects. 

Lowe’s (LOW) is in the same boat, acknowledging that its customers are also avoiding large projects, particularly ones that would require a contractor. 

Home Depot saw sales of $1,000 or more drop by 6.5% in Q1 year-over-year, while Lowe’s sales of $500 or more fell by 7.6% over the same period. Both stocks have lagged behind the overall market this year, with Lowe’s down 2% and Home Depot down around 5%.

Long-Term Promise

The good news for these stores is that analysts believe they’re encountering a short-term problem. Despite remaining “higher for longer,” interest rates are expected to come down eventually. And homeowners are sitting on elevated equity which they might put towards projects when rates fall. 

According to Greg Melich of Evercore ISI, Home Depot’s customers demonstrated strong consumer engagement with products in its first quarter, despite forgoing larger purchases. Melich believes this is a good sign for the store over the long term.

Tapping Into Professional Sales

Now both companies are honing in on their professional customers and contractors. Currently, Home Depot is beating Lowe’s in that arena with nearly half of its business coming from pros. 

Home Depot is upping the ante with plans to acquire SRS Distribution to further tap into a market its CEO believes is worth $250 billion. Meanwhile, Lowe’s has been gaining ground. In Q1, Lowe’s professional sales grew while Home Depot saw a dip. 

Analysts are confident that both stocks will see a rebound when rates come down. With shares currently trading at a low multiple, now could be a great time to buy.

This AI Stock Is Cheap…for Now

High Expectations

Morgan Stanley (MS) is bullish on Tuya (TUYA), a Chinese AI stock that does most of its business overseas. The investment bank believes the stock could rise over 60%. 

Most of Tuya’s sales came from its “Internet of Things,” a cloud-based software for lighting and appliance companies. The company’s shares are down around 7% this year despite its Q1 revenue growing 30% year-over-year, reaching $61.7 million. 

According to analysts, the stock's short-term valuation is attractive.

Gaining Market Share

Analysts liked Toya’s Q1 numbers and noted that they prove its steep upward trajectory. As a result, Tuya raised its revenue guidance for the remainder of 2024. 

Morgan Stanley believes the AI company’s fundamentals are improving, and over 80% of its revenue is diversified outside of China. It brings in around 33% of its revenue from Europe, its largest market. Asia Pacific is its second-largest market, and Latin America makes up around 15% of its revenue. 

According to Tuya’s management, its market share is expanding because close competitors dropped out of the market during a downturn in 2022 and 2023.

Moving up in the World

Tuya has been making big moves recently. According to the company, it’s one of Google’s (GOOG) authorized solution providers, integrating Google Cloud in 2023. Just last week Tuya announced it had earned the Europrivacy GDPR certificate.

Morgan Stanley analyst Yang Liu has given the stock a price target of $3.50. That represents a 66% upside from Wednesday’s close. The future looks bright for this AI stock, and investors might want to jump on board for the ride.

TOGETHER WITH MAGNIFI

Meet the AI that takes the guesswork out of investing.

From planning for retirement to preparing for your child’s college education, investing isn’t easy. Magnifi is here to change that with an AI-powered platform that helps you quickly research, find, and buy investments.

With help from multiple types of AI, Magnifi gives you access to over $10,000 worth of pro-level data. It makes it easy to cut through the jargon and compare possible investments head-to-head.

By centralizing all your data and providing a holistic view of your finances, Magnifi also helps you gain a deeper understanding of your holdings and uncover new, hidden opportunities.

Whether you’re brand new to investing or want to become more financially savvy, Magnifi will act as your investment copilot and help you make the right decisions for your current and future self.

Meet your new investment advisor. Get started today with a free 7-day trial.

Advisory services are offered through Magnifi LLC, an SEC Registered Investment Advisor. Being registered as an investment adviser does not imply a certain level of skill or training.

Last Sunday’s Poll Results

When do you think Berkshire Hathaway will start spending more than it’s selling?

🟨⬜️⬜️⬜️⬜️⬜️ In 2024

🟩🟩🟩🟩🟩🟩 In 2025

🟨🟨🟨🟨⬜️⬜️ 2026 or beyond

Are you bullish or bearish on Weatherford International (WFRD) over the next 12 months?

🟩🟩🟩🟩🟩🟩 Bullish

🟨🟨🟨⬜️⬜️⬜️ Bearish

Which stock do you think will outperform over the next 12 months?

🟨🟨🟨🟨🟨⬜️ Tenaga Nasional (TNABY)

🟩🟩🟩🟩🟩🟩 Sembcorp Industries (SCRPF)