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Why Nordstrom Stock Popped Today

by CoinNews
written by CoinNews

Shares of Nordstrom (JWN 3.59%) climbed 9.4% on Tuesday amid reports that the department store chain is exploring options to go private.

Reaching out to private equity firms

According to “people familiar with the matter” speaking with Reuters earlier today, Nordstrom’s founding family has engaged investment banks Morgan Stanley and Centerview Partners to reach out to private equity firms to gauge their interest in a potential deal.

The timing of the news is no coincidence; Nordstrom shares dropped hard earlier this month after the company issued disappointing guidance that overshadowed slightly stronger-than-expected fiscal fourth-quarter results. Management warned that revenue could decline as much as 2% (the bottom end of its guidance range) in fiscal 2024.

CEO Erik Nordstrom said at that time, “We’re laser-focused on efforts we know will drive growth and profitability across the business over the next few years, including new Rack store openings, Nordstrom digital growth, and increasing comp-store sales.”

There are no guarantees that Nordstrom’s efforts will result in a successful deal to go private. The company previously made multiple unsuccessful attempts to go private back in 2018, which it abandoned after potential lenders demanded extraordinarily high interest rates to support the move.

Nonetheless, it’s hardly surprising to see shares rising today given the allure of a potentially juicy premium to go private. 

Steve Symington 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.

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Finance

Why Advanced Micro Devices Stock Popped 8% This Morning

by CoinNews
written by CoinNews

Shares of semiconductor company Advanced Micro Devices (AMD 8.31%) were up 8.2% as of 10:45 a.m. ET Tuesday — and it’s no great secret why.

On Tuesday morning, not one, not two, but three analysts raised their price targets on AMD stock, citing decent performance in graphics processing units and a big boost to business as the artificial intelligence (AI) trend enters its “second wave.”

Price targets nearly double

AMD’s biggest vote of confidence came from analysts at British bank Barclays, who nearly doubled their share price target on the semiconductor stock from $120 to $200. Barclays named AMD as a beneficiary of this second wave of AI interest as more customers jump on the bandwagon and begin looking for more suppliers of AI chips.

In AMD’s case, that mainly refers to its MI300X line of accelerator chips. Analysts at KeyBank were just behind Barclays in their enthusiasm for AI, setting a $195 price target and predicting we’ll see a “meaningful inflection in demand” for AMD’s new AI chip this year, according to TheFly.com. And as MI300 sales ramp up, KeyBank forecasts $8 billion in GPU sales for AMD this year.

Rounding out the list, Susquehanna Research reports that GPUs are selling “around MSRP,” which suggests at least decent demand for GPUs used to facilitate AI functions.

Caveats and provisos

Not all the news is great. In its report, Susquehanna injected notes of caution regarding weaker segments of the semiconductor universe. Buyers of automotive and industrial semiconductor chips are still flooded with inventory, it seems, and are engaged in a period of “destocking” as they work through their inventories. That won’t be great for pricing. Demand for PC chips is still “bouncing along the bottom,” too, it asserts. Cellphone chip demand seems more or less flat, with weakness evident in China — primarily affecting Apple‘s suppliers.

All this notwithstanding, it’s the AI story that is resonating with investors on Tuesday. If AMD books $8 billion in GPU sales this year as KeyBank predicts, that would be a huge boost to its business, which booked barely $22 billion in revenues over the last 12 months across all of its product lines. While AMD stock looks admittedly pricey at more than 1,100 times trailing earnings right now, a big boom in AI chip demand, undergirded by strong pricing in these chips, has analysts forecasting AMD will earn enough this year to drive its price-to-earnings ratio down to just 39.

AMD investors are betting that price will look cheap a year from now — and are buying the rumor in hopes of profiting from the news.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices and Apple. The Motley Fool recommends Barclays Plc. The Motley Fool has a disclosure policy.

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CoinNews

Was Solana A Q4 2023 “Bubble” That Has Popped?

by CoinNews
written by CoinNews

The crypto market has recently been a roller coaster, especially in H2 2023. Solana, a high-throughput blockchain, emerged as one of the best performers in the top 10 coins by market cap.

In Q4 2023, Solana soared, reaching highs of around $125 before cooling off to spot rates. However, some think the uptrend is over, with SOL edging lower under increasing liquidation pressure.

The Solana Bubble Has Popped, Is This True?

Lido.eth, while taking to X on January 7, said Solana is a “Q4 2023 bubble” that has “already popped.” The analyst added that this formation doesn’t mean SOL is “worthless or won’t be used anymore.” However, based on Lido.eth’s assessment, the Solana “growth story has ended,” calling serious questions into the project’s immediate potential. 

In H2 2023, Solana grew on renewed interest in the high-performance blockchain. Propelled by rising activity in decentralized finance (DeFi) and non-fungible token (NFT) scenes, SOL reversed losses recorded in November 2022.

Moreover, as the crypto community tracked the Securities and Exchange Commission (SEC) and whether they would approve the first spot Bitcoin ETF, altcoins, including SOL, became major beneficiaries.

Arthur Hayes, the founder of the cryptocurrency exchange BitMEX, also believes that the Solana rally is over. In December 2023, Hayes tweeted that he had rotated funds from Solana to Ethereum, citing “divine inspiration.” The BitMEX co-founder also said ETH may rally to reach $5,000 but without giving a specific timeline as to when this lofty target will be reached.

SOL Remains In An Uptrend, Back To $125?

Despite these bearish sentiments, some Solana supporters believe the platform has a “bright future.” They point to the upcoming launch of the Firedancer client. 

This validator client will make the network more robust and increase efficiency. It will aim to decentralize Solana further, making it more reliant by eliminating weak points resulting from client concentration. From a price action perspective, continuing the overall crypto uptrend could also buoy SOL prices in 2024.

Looking at the Solana price chart, the uptrend remains, but sellers dominate, at least in the short term. To quantify, SOL is down 30% from the December 2023 peak when it topped at around $125. 

Solana price trending upward on the daily chart | Source: SOLUSDT on Binance, TradingView
Solana price trending upward on the daily chart | Source: SOLUSDT on Binance, TradingView

With prices trending inside the bear bar of January 3, sellers have the upper hand from an effort-versus-result perspective. For the uptrend to resume, there must be a clear, high-volume close above $100. If not, steep losses below $85 might trigger a sell-off that could price toward $60 or worse.

Feature image from Canva, chart from TradingView

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.



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Finance

Why Advanced Micro Devices Stock Popped Today

by CoinNews
written by CoinNews

Shares of Advanced Micro Devices (AMD 9.89%) climbed 9.9% on Thursday after the chipmaker launched a line of new large accelerated processing units (APUs) designed to handle AI workloads that could rival similar offerings from Nvidia (NVDA 2.40%).

AMD “could get a nice piece” of the AI chip market

At the company’s “Advancing AI” event yesterday, Advanced Micro’s CEO Lisa Su introduced the previously announced Instinct MI300X APUs, which are designed for artificial-intelligence (AI)-oriented servers. They combine the power of the company’s graphics processing units (GPUs) and central processing units (CPUs). Su added that both Microsoft and Meta have already committed to using the chip.

Nvidia currently dominates the industry, with an estimated 80% market share in AI chips.

Su admitted as much in her presentation yesterday, but also noted that AMD believes it “could get a nice piece” of what should be a more than $400 billion market opportunity in AI chips by 2027 — twice as large as the company had previously forecasted. With a market that large, AMD doesn’t necessarily need to beat Nvidia, as there should be room for multiple chip stocks to win as the space grows.

What’s next for AMD investors?

In a note to clients early Thursday morning, analysts at Citi estimated AMD could command around 10% of the total AI chip market after it starts shipping its new AI-centric products, starting in 2024.

For perspective, consensus estimates on Wall Street currently predict AMD’s revenue will decline a modest 4% in 2023 to under $23 billion. By comparison, Nvidia’s revenue this fiscal year is expected to more than double, to nearly $59 billion.

Commanding even a 10% piece of the fast-growing AI chip market represents a massive opportunity for AMD to reaccelerate its growth. The stock is responding in kind today.

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Steve Symington has positions in Nvidia. The Motley Fool has positions in and recommends Advanced Micro Devices, Meta Platforms, Microsoft, and Nvidia. The Motley Fool has a disclosure policy.

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Finance

Why Knight-Swift Transportation Stock Popped Today

by CoinNews
written by CoinNews

Shares of Knight-Swift Transportation (KNX -1.59%) were moving higher today after the diversified transportation company topped analyst estimates in its third-quarter earnings report.

As of 11:27 a.m. ET, the stock was up 9.4% on the news.

A truck at a loading dock

Image source: Getty Images.

The competitive landscape is improving for Knight-Swift

Knight-Swift, which offers full-truckload, less-than-truckload (LTL), logistics, and intermodal services, posted solid revenue growth in its third quarter with the top line up 6.5% to $2.02 billion, ahead of estimates at $1.89 billion, helped in part by its acquisition of U.S. Xpress.

That growth was driven by its full truckload business, which saw revenue jump 22% to $1.17 billion, excluding its fuel surcharge.

However, profitability in that key segment fell due to an “extremely difficult environment,” including ongoing soft demand, and an increase in fuel prices. Adjusted operating ratio, which is the inverse of operating margin and excludes the U.S. Xpress acquisition, jumped from 81.8% a year ago to 94.9% but improved slightly from the second quarter.    

Profit margins also shrank in the logistics and intermodal segments, and overall adjusted earnings per share (EPS) fell from $1.27 to $0.41, ahead of the consensus at $0.36.

Comments on the earnings call seemed to give the stock a boost. As CEO Dave Jackson said, “It feels like the extreme aggressiveness that we have seen out of non-asset-based players has reached a level to where it’s not only unsustainable but when you add how expensive financing is … it blows up.” Those remarks seemed to refer in part to the closure this week of digital freight broker Convoy.

Can Knight-Swift stock move higher?

Knight-Swift revised its full-year adjusted EPS guidance from $2.10-$2.30 to $2.10-$2.20, and management forecast that truckload rates would stabilize at current levels and says it expects solid growth in LTL revenue and shipments. 

It also sees the bottom-line impact from the U.S. Xpress acquisition improving, a sign that the company will return to profit growth in 2024.

With interest rates still moving higher, it will take some time for the volatility in the industry to play out, but the worst of the U.S. Xpress integration seems to be behind the transportation stock.

Jeremy Bowman 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.

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Finance

Why Nio Stock Popped Friday

by CoinNews
written by CoinNews

What happened

Shares of Chinese electric vehicle (EV) maker Nio (NIO 7.11%) spiked more than 10% Friday morning after the company reported its August vehicle delivery figures. After rising as much as 10.5%, Nio’s American depositary shares pared some of that gain and were trading higher by 7.5% as of 12:45 p.m. ET. 

So what

The initial spike was likely a sign of relief that consumers in China continue to spend — at least on new EVs. Nio reported this morning that it delivered more than 19,000 vehicles in August. That’s less than the record 20,462 it reported in July, but August still marked its second-best month ever. 

Now what

Nio shares soared after the company announced its record July sales. But concerns about economic conditions in China tempered that run in the share price. When the company reported its second-quarter results earlier this week, it guided investors to expect third-quarter deliveries of between 55,000 and 57,000 units. That would represent a jump of more than 80% versus last year’s third quarter at the high end. But the market grew skeptical as concerns grew over China’s ability to spur consumer spending and economic growth.

Today’s news helped ease those concerns. In the first two months of the current quarterly period, Nio has shipped nearly 40,000 EVs, which is more than 90% above the comparable period last year. So it now doesn’t seem to be a stretch for Nio to beat its recent third-quarter guidance. It would only need to deliver 17,209 vehicles in September to beat the high end of its guidance. 

That seems very achievable after what it reported in the last two months. That has investors getting optimistic about Nio’s future prospects once again today. 

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Finance

Why Bitcoin, Ethereum, and Dogecoin Popped Today

by CoinNews
written by CoinNews

What happened 

Cryptocurrencies have rallied sharply this week, but that rally cooled off over the last 24 hours. Tuesday’s jump was driven by Grayscale’s win over the U.S. Security and Exchange Commission (SEC) in court, which could pave the way for more crypto ETFs, but the rally hasn’t lasted. 

Between noon ET on Tuesday and 3:15 p.m. ET on Wednesday, the value of Bitcoin (BTC -0.86%) fell 2.7%, Ethereum (ETH -0.90%) was down 1.9%, and Dogecoin (DOGE 1.30%) dropped 2.1%. But the cryptocurrencies are up 2.9%, 1.4%, and 2.2% over the past week, so there has been a rally overall. 

Person trading Bitcoin on a smartphone.

Image source: Getty Images.

So what 

The court’s ruling yesterday that the SEC must review the Grayscale Bitcoin Trust application to convert into an ETF could pave the way for more Bitcoin ETFs. And that could open up more crypto ETFs for Ethereum or even Dogecoin. 

What the judge’s ruling doesn’t guarantee is that any ETFs will actually be approved. The SEC just needs to review the application and treat it like any other Bitcoin ETF application, which hasn’t yet been approved. So, it’s back to a waiting game for investors.

What we have seen is repeated wins for the crypto industry in court. The Ripple ruling in July paved the way for cryptocurrencies to be regulated more like commodities rather than securities, and now trading options may be opening up via ETFs. 

It’s not clear when there will be a final ruling on a Bitcoin ETF or if an answer on what’s a commodity and what’s a security will be coming, but this was seen as a positive sign for the industry. 

Now what 

The bounce in values on Tuesday is what’s reversing today. There was at least some hope that this would lead to more ETFs and more certainty for the industry, but as the market has processed the ruling, it’s clear that’s not what happened. 

That said, the court being more friendly to the crypto industry should be an incremental positive long term. Trading has all but dried up for most cryptocurrencies, and that’s left the industry in an uncertain place. The regulatory uncertainty hasn’t helped, but if that gets answered, there’s billions of dollars of investment that’s gone into companies building on the blockchain. That’s where the real innovation will take place that could cause values to increase.

For now, the market seems to be cautiously optimistic when there’s a positive ruling, but the bounce doesn’t last long because there’s no fundamental change in the market. That’s what’s holding values back and why we get the pop and then the slow drop of the last 36 hours. Expect that trend to continue until there’s regulatory clarity, which at this rate could still be years away. 

Travis Hoium has positions in Ethereum. The Motley Fool has positions in and recommends Bitcoin and Ethereum. The Motley Fool has a disclosure policy.

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