🗑️ One Man’s Trash

Plus, an alarming safety scandal among Japanese automakers

June 03, 2024

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 Were Mixed on Monday as investors are cautious ahead of a variety of economic updates and reports coming out this first week of June.

  • 📈 | One Notable Gainer: Shares of Paramount popped 8% on news that an agreement was reached for its merger with Skydance. This comes after weeks of competing offers from Apollo Global Management and Sony Pictures.

  • 📉 | One Notable Decliner: Pharmaceutical company GSK saw its shares fall 9% after a Delaware state court said it would allow more than 70,000 cases that allege GSK’s heartburn drug causes cancer to proceed to trial.

  • 🗑️ | Tomorrow's Trade: One Man’s Trash. Scroll down for more.

Plus, did you miss out on Ring and Nest? This is your chance to secure your stake in the smart home market.

YESTERDAY’S POLL RESULTS

🟩🟩🟩🟩🟩🟩 Yes ✅ 

🟨🟨🟨🟨⬜️⬜️ No ❌ 

S&P 500 Heatmap. Credit: Finviz

All Stock Heatmap. Credit: Finviz

Global ADR snapshot. Credit: Finviz

MARKET MOVERS

GPCR (+54%) Structure Therapeutics released clinical study data on its daily obesity drug, showing participants lose 6% body weight after 12 weeks (WSJ)

NVDA (+5%) Nvidia’s stock ripped higher Monday after CEO Jensen Huang revealed details about the company's next AI chip platform (YF)

HTZ (-5%) Shares of car rental company Hertz dropped after announcing that its CFO and COO are leaving after spending less than a year in the roles (MW)

AMD (-2%) Advanced Micro Devices’ stock fell despite unveiling its latest AI processor, the MI325x Accelerator (Investopedia)

MRNA (+4%) Promising trial data showed efficacy for Moderna’s experimental vaccine combined with Merk’s Keytruda in treating skin cancer (QZ)

TOGETHER WITH RYSE

Best Buy has a proven record of placing early bets on home technology products that go on to dominate the market. For example:

Ring - acquired by Amazon for $1.2B

Nest - acquired by Google for $3.2B

And the nationwide retailer just unveiled a new smart-home product in 100+ stores: RYSE Smart Shades.

RYSE is positioned to dominate the smart shades market (currently growing 50% annually) and there’s still time to invest in their $1.50/share public offering.

Missed out on Ring and Nest? This is your chance to secure your stake in the smart home market.

This opportunity closes in 2 weeks - don't miss out.

OVERHEARD ON THE STREET

Bloomberg: Saudi Aramco’s $12 billion share sale sold out shortly after the deal opened on Sunday, helping fund the nation’s massive economic transformation.

CNBC: Digital bank Monzo posted its first full year of profit after more than doubling its revenue to £880 million for the full year.

Reuters: Online fashion firm Shein is planning to file a 50 billion pound London IPO prospectus that could take place as soon as the coming week.

CNBC: Jeep expects to grow its plug-in hybrid SUV (PHEV) sales by as much as 50% in 2024, projecting PHEV sales between 160,000 and 170,000.

Reuters: Tesla defended a proposal to ratify CEO Elon Musk’s $56 billion pay package and said a new compensation package would be costlier.

TOMORROW’S TRADE IDEA, TODAY

The Underdogs

According to UBS (UBS), a handful of stocks are getting hated on by Wall Street, but they could provide an opportunity for investors. 

Despite a 10% S&P 500 gain this year, some large-cap stocks have yet to join in on the growth. UBS strategist Jonathan Golub came out with a list of stocks with improving fundamentals that might be flying under the radar and preparing to soar.

The list is compiled of stocks with below-average analyst ratings, substantial 52-week drawdowns, and proven 3-month earnings momentum.

Home and Auto

Ford Motor (F) made the list. The automaker’s shares have been flat this year. Many analysts give it a “hold” rating, and the analyst consensus upside is around 16%. 

However, Daniel Roeska of Berstein believes shares could climb much higher than that, up to 38%. According to the analyst, Ford is experiencing good profits from core markets and its EV unit holds promise of profits. 

Airbnb (ABNB) also made the list, despite being up over 7% this year. Like Ford, the average analyst rating for the stock is “hold.” Its average price target suggests a 5% upside. Wedbush analyst Scott Devitt believes it’s a good entry point for the stock, as its price fell nearly 10% over the last month following poor first-quarter earnings.

Norwegian Cruise Line

Norwegian Cruise Line (NCLH) was on the list too. Its shares are down 9% this year, and it has an average analyst rating of “hold.” However, its price target suggests around a 26% upside. 

Mizuho disagrees with the consensus, recently upgrading the stock to a “buy.” Mizuho analyst Ben Chaiken thinks the stock has fallen far enough to make its current price point attractive to investors. He also cited the company’s efforts to streamline its business and cut costs as reasons to be bullish. 

For investors looking to go against the grain and find value where others have overlooked it, these stocks could fit the bill.

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

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TOGETHER WITH RYSE

Best Buy has a proven record of placing early bets on home technology products that go on to dominate the market. For example:

Ring - acquired by Amazon for $1.2B

Nest - acquired by Google for $3.2B

And the nationwide retailer just unveiled a new smart-home product in 100+ stores: RYSE Smart Shades.

RYSE is positioned to dominate the smart shades market (currently growing 50% annually) and there’s still time to invest in their $1.50/share public offering.

Missed out on Ring and Nest? This is your chance to secure your stake in the smart home market.

This opportunity closes in 2 weeks - don't miss out.

ON OUR RADAR

SCMP: Japan’s car safety scandal is deepening, as it was found that Toyota, Honda, Mazda, and other automakers falsified or manipulated safety data.

CNN: A recent survey from accounting firm KPMG showed that 60% of those making $200,000+ expect to do more discount shopping this year.

YF: A majority of Americans polled by Harris believe the US is already in a recession, and roughly half wrongly believe the S&P 500 is down this year.

WSJ: E*Trade is considering removing meme-stock leader Keith Gill from its platform after growing concerned about potential GameStop stock manipulation.

Fox Business: Nvidia’s Jensen Huang promised a new computing age led by Taiwanese tech and floated ideas of lifelike digital humans.

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