Sectors: Technology
The Chinese e-commerce operator reported fourth-quarter results overnight that were inline / slight beat to expectations in terms of both revenue and earnings while its annual active customer accounts were below consensus estimates. That saw a ~15% decline in the stock dragging down other U.S.-listed Chinese stocks.
Market heavyweight Apple has already bounced 10% from last weeks low and technically we can see fresh all-time highs in the coming months, it would need such a move for MM to consider trimming our holding but in today’s market we shouldn’t forget MM’s mantra for 2022/3 – “buy weakness and sell strength with the emphasis on the later”.
Z1P Trading Halt: The Buy Now Pay Later (BNPL) company was in a trading halt today following the announcement of their 1H22 results, the acquisition of competitor Sezzle (SZL) and a ~$200m equity raise priced at $1.90, $149m of which is underwritten. The price of $1.90 represents a 14% discount to the last close. We attended a management presentation today as…
MM also holds AMZN and our view is very similar to that of Google i.e. a trend is emerging!
MM holds Google as most of us call Alphabet in our International Portfolio, its performed reasonably well considering the overall move in tech / growth names. If markets hold together we anticipate fresh highs in 2022 but in-line with our outlook towards tech stocks we at least envisage another 8-10% upside i.e. we not considering taking profit at the moment.
The APX share price was savaged yesterday after their result was a miss and management confirmed low visibility on near term earnings, although they offset that by putting big longer term targets out to the market, considering their ability to forecast earnings over the last few years that doesn’t bring with it any confidence and even if they prove correct it’s going to require…
APX -28.70%: This has been a polarising stock in recent times with some analysts forecasting downgrades while others doubled down and increased their conviction on the buy side, today the stock fell ~30% after missing FY21 earnings expectations and pulling FY22 guidance, in favour of longer term revenue targets which were big, a lot bigger than anyone in the market expected, however FY26…
As we mentioned previously we believe tech stocks are poised to correct their savage decline since late 2021, potentially even the underperformers like MP1 which has tumbled over 40% at a rate of well over 10% per month. We’re not an interested buyer of MP1 but it looks very similar to ALU and HUB with the next 15% looking likely on the upside.
Yesterday saw MM increase our exposure to ALU following its 32% correction, its always a nice feeling to observe a stock you’ve just purchased rally over 5% but obviously 1-day doesn’t make a summer. Our initial target is another 15-20% higher inline with our outlook for growth / tech names at which point we will be looking to reduce our sector exposure, either through ALU or another of our holdings.
We are looking at a simple switch in-line with our recent rhetoric towards equities:
