The company is edging closer to a $2 trillion market value.
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After years of rumors and speculation, Apple (AAPL -0.66%) is finally shutting down its effort to make a car. In this video, I’ll explain why Apple stock investors should view this as a positive.
*Stock prices used were from the trading day of Feb. 27, 2024. The video was published on Feb. 28, 2024.
Neil Rozenbaum has positions in Tesla. The Motley Fool has positions in and recommends Apple and Tesla. The Motley Fool has a disclosure policy. Neil is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
In this video, I will be going over Teladoc‘s (TDOC -23.67%) fourth-quarter earnings and discuss whether now is a good time to open a position with the stock back to its all-time lows.
*Stock prices used were from the trading day of Feb. 20, 2024. The video was published on Feb. 20, 2024.
Neil Rozenbaum has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Teladoc Health. The Motley Fool has a disclosure policy. Neil is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
Electric vehicle startup Fisker (FSR -8.33%) had its fair share of challenges to overcome during 2023, and that might be putting it lightly. It slashed production estimates a number of times, had a disappointing third-quarter earnings report, and its chief accounting officer resigned.
That said, investors can rejoice that the company has made plans that could solve its biggest headache: deliveries.
What happened?
“We have not been able to follow through with deliveries fast enough,” CEO Henrik Fisker said during the company’s recent third-quarter earnings call. “People have paid and are waiting for their cars, and some of them are getting really annoyed.”
For a young electric vehicle (EV) company just getting started and facing a cash crunch, having trouble connecting the dots between accelerating production and making deliveries to buyers is a big deal — and bad news. Fortunately, Fisker recorded a 300% increase in deliveries from the third quarter to the fourth quarter, and that could improve even more after the company announced a new strategy for its delivery infrastructure.
Welcome, new dealers
Fisker announced it’s currently developing an innovative dealer partnership model in North America, and also shifting to a hybrid model in Europe that combines direct sales and dealer arrangements.
More specifically, Fisker plans to have roughly 100 dealer locations across Europe and North America, and expects to send its first Fisker Ocean SUVs to new dealers by the end of the first quarter. Management believes this will enable Fisker to expand its sales and deliveries at a faster pace while still hewing to its asset-light strategy.
The new dealer partnership plan is intended to benefit both sides of the transaction: Customers will get more convenient locations at which they can buy Fisker vehicles, and the dealer partners will get larger territories to market into, giving them pricing control with less competition.
Fisker has been in discussions with a number of dealers since late November, and the new sales strategy should combine with its test-drive network to boost sales and delivery infrastructure. Fisker delivered roughly 4,700 vehicles in 2023 and produced 10,142 Oceans, meaning there’s plenty of room for it to grow simply by improving its delivery-to-production ratio. For comparison, rival EV maker Rivian‘s gap between production and deliveries was roughly 5% during the third quarter.
Is the stock finally a buy?
To put it bluntly, there’s a lot of risk that comes with investing in Fisker. The company slashed its production estimates multiple times during 2023, admitting that part of the decision was to free up $300 million in working capital during a cash crunch. Fisker’s net cash used in operating activities totaled $308.2 million during the third quarter, and its cash and cash equivalents checked in at $625.4 million at the end of that period.
That said, this could well prove to be rock bottom for the young EV company if it can build out its delivery infrastructure and begin generating higher revenues. There’s little doubt that it will continue to book losses in the near term, and it’s a speculative investment. As such, investors would be wise to limit their Fisker positions to a small percentage of their portfolio’s value, and buy in only if they believe the third quarter was truly rock bottom for the EV maker.
Daniel Miller has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Ethereum price is gaining pace above the $2,320 resistance zone. ETH is up over 5% and it seems like ETH is finally outperforming Bitcoin.
- Ethereum is gaining pace and trading above the $2,300 support zone.
- The price is trading above $2,350 and the 100-hourly Simple Moving Average.
- There is a connecting bullish trend line forming with support at $2,380 on the hourly chart of ETH/USD (data feed via Kraken).
- The pair could extend its rally toward the $2,500 and $2,550 resistance levels.
Ethereum Price Starts Fresh Rally
Ethereum price extended its decline below the $2,250 level. ETH even spiked below the $2,200 level before the bulls appeared. A low was formed near $2,180 and the price started a strong increase, outperforming Bitcoin.
There was a move above the $2,250 and $2,280 resistance levels. The bulls even pumped the price above the $2,350 resistance. A new multi-day high is formed near $2,441 and the price is now consolidating gains. The price is now trading above the 23.6% Fib retracement level of the upward move from the $2,180 swing low to the $2,441 high.
Ethereum is now trading above $2,350 and the 100-hourly Simple Moving Average. On the upside, the price is facing resistance near the $2,440 level.
Source: ETHUSD on TradingView.com
The first major resistance is now near $2,500. A close above the $2,500 resistance could send the price toward $2,500. The next key resistance is near $2,620. A clear move above the $2,620 zone could start another increase. The next resistance sits at $2,700, above which Ethereum might rally and test the $2,800 zone.
Downside Correction in ETH?
If Ethereum fails to clear the $2,440 resistance, it could start a fresh decline. Initial support on the downside is near the $2,380 level and the trend line.
The first key support could be the $2,320 zone or the 50% Fib retracement level of the upward move from the $2,180 swing low to the $2,441 high. A downside break and a close below $2,320 might spark more bearish moves. In the stated case, Ether could revisit the $2,200 support. Any more losses might send the price toward the $2,120 level.
Technical Indicators
Hourly MACD – The MACD for ETH/USD is gaining momentum in the bullish zone.
Hourly RSI – The RSI for ETH/USD is now above the 50 level.
Major Support Level – $2,320
Major Resistance Level – $2,440
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
Bitcoin’s (BTC) rise to as high as $35,000 this week has also lifted a number of memecoins, including Floki (FLOKI), which has beaten its top rivals in percentage gains.
FLOKI price up 140% amid Bitcoin ETF hype, TokenFi launch
As of Oct. 27, FLOKI had surged over 140% to $0.00004261, its highest level in five months. The memecoin, known for its controversial marketing tactics, rallied after New York-based Grayscale Investments filed for a new spot Bitcoin exchange-traded fund (ETF) on NYSE Arca, as shown below.
Looking at the past 24 hours, FLOKI’s gains have picked an additional boost from the launch of its tokenization platform, TokenFi, with its own native token, TOKEN, on Oct. 27. Notably, users will be allowed to stake their FLOKI holdings to receive TOKEN.
$FLOKI is launching staking and a new tokenization platform to target the $16 trillion tokenization industry today! ️️️️
Their new token is named TokenFi with the $TOKEN ticker! ️️️️️️
Brilliant idea and execution. No wonder #Floki is outperforming $DOGE, $SHIB,… https://t.co/n3sjXYdnJR
— Shelby (@CryptoNewton) October 27, 2023
Where is FLOKI price going next?
FLOKI’s ongoing price rally has brought its daily relative strength (RSI) to its most overbought level since January 2023.
An overbought RSI typically precedes a correction period. In FLOKI’s case, its earlier stint with overbought RSIs has followed up with strong price declines, thus raising the possibility of a similar downside reaction in the coming days or weeks.
If FLOKI’s rally stalls, then the FLOKI/USD pair risks dropping toward its 0.5 Fibonacci retracement line near $0.00003548 in October 2023. A decisive close below the level may crash the price toward the 0.236 Fib line near $0.00003069 in November 2023, down 20% from the current price levels.
Conversely, the price may break above the current resistance level of $0.00004027 to pursue a run-up toward $0.00004078.
Are memecoins like DOGE, SHIB waking up?
Almost all memecoins have underperformed top-ranking cryptocurrencies like Bitcoin so far in 2023, with some even returning year-to-date (YTD) losses.
For instance, top memecoin Dogecoin (DOGE) has rallied over 30% since the Grayscale Bitcoin ETF announcement on Oct. 19. Nonetheless, its YTD returns as of Oct. 27 are a mere 1.3%, compared to BTC’s 105% gains in the same period.
Similarly, Shiba Inu (SHIB) is down 2.75% YTD despite rallying nearly 25% in the last seven days.
The only exceptions are Pepecoin (PEPE). A memecoin that debuted in April 2023 and has risen over 500% since. Then there’s FLOKI, whose YTD returns are around 435% as of Oct. 27.
Related: Is Bitcoin overheated? Some believe the answer is hiding in PEPE
Speculators hunt memecoins for maximum returns in minimum time, typically when risk sentiment is strong across the crypto space. For instance, the 2020 to 2021 crypto bull market saw Dogecoin surging up 67,475% versus Bitcoin’s 1,700% gains.
Nonetheless, memecoins can fall as drastically when risk sentiment exhausts.
DOGE, for instance, has crashed 90% from its 2020 to 2021 bull market top. Therefore, whether or not memecoins will continue their rally in the future largely depends on the ETF update and its impact on the BTC price.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
For a long time, cash had so little returns that baby boomers had no choice but to invest more in riskier stocks as they approached retirement to get the returns they needed.
But since the Federal Reserve started jacking up its benchmark interest rate, that’s shifting and cash investments are seeing some of the largest yields in more than decade.
The average online savings account return is now 4.39%, according to DepositAccounts.com. The average yield on an online, one-year certificate of deposit, or CD, is now 5.10%, while the one-year Treasury bill is yielding 5.46%.
Financial advisers are taking that into consideration as they help manage the portfolios of their retired clients and those closing in on retirement. But while many expressed enthusiasm for the new options that cash investments offer, these advisers also cautioned that stocks still play an integral part in an investor’s retirement portfolio.
“While short-term investment products, like money markets and CDs, can play a role in portfolios, it may be difficult to build a longer-term portfolio allocation around them as short-term interest rates can fluctuate as monetary policy changes,” said Adam Reinert, chief investment officer and COO at Marshall Financial Group. “Though with higher interest rates on intermediate-term debt, investors may not have to be as dependent on equity allocations to do as much of the heavy lifting for portfolios as they did from 2010-2019.”
Read more: The best money market accounts for September 2023
What are they buying and for whom?
Jordan Benold, a financial planner from Benold Financial Planning, said his firm previously advised clients who were in retirement or near it to invest in “riskier income assets like preferred stock, corporate bonds, and REITs to increase their income.”
Now, he is recommending in six-month Treasury bills “simply because they pay the most.”
“There is no reason to take that risk when one of the safest assets in the world is paying 5.5%,” he said. “Also, I am having my younger clients invest a small portion into T-bills for their bond allocation. This is not a large percentage, but once again, it will provide the insurance they need if the stock market decreases and will pay a high coupon.”
Certificates of deposit, in particular, can benefit near-retirees and current retirees alike.
Malcolm Ethridge, executive vice president at CIC Wealth, noted that CDs with six- to 12-month maturities are a strong investment for retirees who have already begun drawing income from their portfolio. Pre-retirees, concerned that they might be retiring into a recession, can “de-risk their portfolio” by moving a couple years’ worth of expenses into cash via a brokered CD, he said, allowing them “to weather any potential storm while entering retirement.”
“We have been buying more brokered CDs on behalf of our clients in the last seven or eight months than at any other period in my career,” Ethridge said.
In the last year and a half, Holzberg Wealth Management has been shifting client portfolios to CD ladders with minimal risk. CD ladders are when financial planners use multiple CDs with different maturity dates.
If interest rates continue to rise, the firm plans to reinvest the near-term CD funds into ones with longer maturities, which increases the overall yield, said Marcus Holzberg, a certified financial planner at the firm.
“If interest rates fall, the same strategy can continue or be redeployed to other market opportunities,” he said. “In other words, it’s a win-win.”
Read more: The best CD rates for September 2023
What about stocks?
Stocks, though, still play an important role in portfolios.
For roughly the last 40 years, net growth from cash was reduced to zero after subtracting inflation and taxes, founder and principal at Daniel J. Galli & Associates, said.
“In order to have real buying power growth, dollars need to earn more than what they can in cash,” he said. “Historically stocks have delivered this …The price we pay is volatility. But over long periods of time stocks have generally delivered real buying power growth.”
Jon Ulin, CEO of Ulin & Co. Wealth Management, also pointed out that the Federal Reserve will eventually cut rates — though maybe not for a few years given this week’s Fed meeting — bringing them back to where they began last year.
“While it may be sensible to position a couple years of cash reserves in low-risk, high-yield cash instruments and buckets,” he said, “investors will better benefit over time by staying diversified, rebalancing, and buying low into stocks and bonds for their long-term retirement accounts and not give up potential gains around the turnover of the next bull market.”
Read more: The best high-yield savings account rates for September 2023
Risk-free can still be risky
Cash also offered fewer benefits in the long term.
“Time is a crucial factor when considering long-term investing, whether you are in or nearing retirement,” Ulin said. “The longer your investment horizon, the more you can benefit from the market’s historical tendency to recover from declines and deliver substantial returns over the long haul.”
Folks can also underestimate the length of their retirement and subsequently the need for the historically bigger returns stocks deliver over cash.
“The time horizon for a retiree is still 20-30-plus years. In today’s interest rate environment, if you were to construct a 20/80 portfolio in fear of equity risk, then any gains you’d have in the fixed-income portion would just be eroded by inflation,” said Nate Creviston, manager at Capital Advisors Ltd. “You still need to have a balanced approach to your asset allocation through retirement.”
Stocks are also up year to date. The S&P 500 index (^GSPC) is up 12.5%, while the Nasdaq (^IXIC) has increased 26.2% since the beginning of the year. Consequently, folks should weigh the risks and benefits of cash, said Constantine Tsantes, a financial planner at Cetera Advisor Networks LLC.
“In the long run, you are only going to miss out on the upside, like what we have seen in equities this year,” Tsantes said. “If retirement is around the bend, sure we can allocate to more fixed-income investments, but there is really no need to keep more than two to five years of expenses set aside in those investments.”
Dylan Croll is a Yahoo Finance reporter.
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The S&P 500 is still expensive at just over 19 times 12-month forward earnings, up from about 15 times at the start of the rally.
Spencer Platt/Getty Images
Stocks have soared, and Wall Street is raising its S&P 500 targets. Please do your best to ignore them.
The week began with a number of strategists lifting their forecasts for the
S&P 500 index.
Citigroup raised its mid-2024 forecast to 5000 from 4400, while Piper Sandler hiked its to 4825 from 4625.
Even Morgan Stanley’s Mike Wilson, who has a worst-case-scenario target that calls for an 18% downside, acknowledged in his note this past week that the market’s rally could be a sustainable one.
It’s probably not a coincidence that the stock market had a difficult week, with the S&P 500 dropping 2.3%, the
Dow Jones Industrial Average
falling 1.1%, and the
Nasdaq Composite
dipping 2.8%. The S&P 500, after all, entered the week up 28% from its bear-market low in October, and strategists, many caught off guard by the massive rally, have responded by acknowledging what has already happened and marking their forecasts to market.
Not that there’s anything wrong with that. If we learned anything this past week, it’s that the economy remains resilient, but not so strong that it forces the Federal Reserve to do something unexpected. The U.S. added just 187,000 jobs in July, according to the latest payrolls report, and earlier months were revised lower. Chalk that up as one more sign that a soft landing is still a possibility.
Earnings, too, have been stronger than expected—
Amazon.com
(ticker: AMZN), which gained 8.3% after its report, was a particular standout—which was especially important, given the S&P 500’s premium valuation.
Yet rushing to buy after the S&P 500 has had its best first seven months of the year since 1997 feels, well, unnecessary. It doesn’t change the fact that the index is still expensive at just over 19 times 12-month forward earnings, up from about 15 times at the start of the rally, or that stocks like
Apple
(AAPL), which had helped drive the rally, are showing signs of topping out. It all reeks of desperation and the fear of missing out.
“The bears are finally throwing in the towel, and we are now beginning to see some examples of FOMO,” says Michael Arone, chief investment strategist at State Street Global Advisors. “As that happens, I get increasingly more anxious.”
Arone warns of a potential drawdown. History bears him out—and not just because it’s summer, a historically weak period for the market. A quick glance at a chart of the average S&P 500 target superimposed over the index itself shows that Wall Street forecasts are, at best, a coincident indicator and, at worst, a lagging one. In 2022, for instance, they peaked just after the market did in January of that year.
Of course, the market always needs a reason to fall, and this past week it found one in surging Treasury yields. It’s hard to tell exactly what made them pop. Though some blamed Fitch’s downgrade of the U.S. credit rating to AA+ from AAA, it’s more likely a combination of massive issuance—the Treasury said it plans to issue more debt than had been expected—and solid economic data that forced market participants to reconsider their growth targets. Higher yields make stocks worth less, all else being equal. As long as they don’t rise too much, though, it could present a buying opportunity.
That’s especially true as markets look ahead to 2024. Some 61 S&P 500 companies that had reported second-quarter earnings raised profit guidance as of Tuesday, while 23 had cut outlooks, according to Wells Fargo. That’s partly why analysts expect sales and earnings to grow next year.
“The market’s looking at 2024,” says Doug Bycoff, chief investment officer of the Bycoff Group. “If we get a 5% pullback, we’re going to be waiting to pounce.”
In other words, don’t buy when everyone is excited—buy on dips.
Write to Jacob Sonenshine at jacob.sonenshine@barrons.com