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Friday 4 Play: The “Can You Take Me Hyzon?” Version
Hyzon, Hyzoff.
Hyzon, Hyzoff.
Hydrogen energy takes one step ahead.
Hydrogen energy takes one step again.
Hyzon, Hyzoff.
Thanks, Mr. Miyagi, however are we going to say the Rattling Yankees up there within the headline?
How about we don’t and say we did?
Now, on a regular Friday, I’d be asking: “Are ya prepared, youngsters?” After which we’d all sing a halfhearted rendition of the SpongeBob SquarePants theme, dive into the inbox and see what emails stick, like Scrooge McDuck.
However that is no regular Friday. No, sir! And seeing as what number of of your emails had been about Hyzon (Nasdaq: HYZN) … we’d as properly get into the actual meat of the matter.
By now, all y’all Nice Stuff Picks buyers holding HYZN ought to have observed that the inventory is down about 38% at this time. There’s no simple strategy to say it … oof. That smarts.
So what occurred that brought about HYZN shares to fall off a cliff? And is it critical sufficient that it warrants promoting the inventory? We’ll reply each questions in a sec, however to get the hydrogen-powered elephant out of the room … nope. We ain’t promoting.
Hyzon introduced two essential items of information: First up, a three way partnership in Europe fell via, forcing Hyzon to restructure its plans to develop all through the area.
You would possibly do not forget that Hyzon had teamed up with Holthausen to transform heavy-duty vehicles over to gas cells.
In line with Hyzon’s submitting, the corporate discovered “operational inefficiencies” within the three way partnership, which suggests Hyzon must dump Holthausen and make a unique plan to get its fuel-cell enterprise correctly rising throughout Europe.
However Hyzon’s different piece of stories comes out of China — and that is doubtless what spooked HYZN buyers essentially the most.
Mainly, income accounting wasn’t correctly dealt with in China. This implies Hyzon should delay its monetary outcomes whereas accountants/auditors undergo and see precisely what data is inaccurate.
Since everyone knows that every U.S.-listed firm is remitted to provide an earnings report … all people’s minds immediately went to delisting. Ask any Alibaba investor — delisting fears are a surefire strategy to ship a inventory tumbling in a single day.
Now, this delay gained’t trigger Hyzon inventory to delist on account of non-compliance … however there’s a menace. And that menace is how lengthy it takes to search out out what went incorrect in China.
Y’all know the way a lot Wall Avenue hates uncertainty — whether or not it’s issues over monetary reporting, concern over China or concern over monetary issues in China.
The most important affect for us is that the corporate was on the verge of being worthwhile — thiiiiis shut — and that’s in all probability out the door now.
So … why aren’t we promoting this factor?
For a couple of good causes: In contrast to many strapped-for-cash vitality corporations, Hyzon nonetheless has greater than sufficient money available to finance operations in the meanwhile.
I’m not too apprehensive concerning the European three way partnership. Bear in mind, hydrogen energy is taking off in Europe a lot a lot greater than it’s stateside. Somebody will decide up the place Holthausen failed.
Whereas I’m maintaining a tally of the potential fallout in China, the issues are just for fiscal 12 months 2021. The errors had been acknowledged internally … not externally by some short-selling hedge fund intent on destroying HYZN inventory for its achieve.
That is the primary potential blow to the corporate’s administration, however they appear to be on high of it, which is greater than you may say for a lot of EV startup corporations which have come below hearth…
That’s a superb signal to me … regardless of the rapid outcomes not going properly for buyers.
Bear in mind, you’re free to promote any inventory within the Nice Stuff Picks portfolio at any time. If you happen to’re dropping sleep, do what you’ll want to do. It’s your cash (or “funding capital” if you wish to be all Richie Wealthy fancy), and I gained’t inform you what to do with it.
However all that stated? Nice Stuff will proceed hodling Hyzon within the portfolio.
Feedback? Questions? Considerations? Want validation from some random dude on the web? We’ve bought an inbox for all the above. Write to us at GreatStuffToday@BanyanHill.com each time the market muse compels you.
In fact, when you’re not prepared to depart the EV market behind utterly, we’ve bought you coated.
One startup’s new know-how is poised to disrupt the $2 trillion automotive business. Its gentle, cheap, highly effective and quick-charging battery could possibly be the tipping level that lastly makes EVs inexpensive for on a regular basis Individuals.
The truth is, a Wall Avenue legend predicts it is going to trigger a 1,500% surge in EV gross sales over the following 4 years.
Click on right here to see why!
And now for one thing utterly totally different, right here’s your Friday 4 Play:
No. 1: Roam The place You Need To
Roomba ‘around the world…
Wow, your psychological radio dial is absolutely caught on 1990 at this time, huh.
Like a wayward, rampant Roomba gone wild — sorry for the visible — iRobot (Nasdaq: IRBT) inventory shot up 19% in a single day. That’s proper: The Roomba robo-vac maker and one-time Nice Stuff Choose simply bought Amazoned.
So Amazon’s (Nasdaq: AMZN) shopping for up a full-fledged shopper robotic firm. What may presumably go incorrect? C’mon, everyone knows Amazon would substitute extra human warehouse employees with robots if it may. They’d must be much more correct than a Roomba although…
Anyway, Amazon is shopping for iRobot at $61 a share, valuing iRobot at about $1.7 billion.
Now what was that we had been simply saying about a rise in buyout motion now that tech shares have been crushed to a pulp? Yeah, right here we go. Earlier than the acquisition, IRBT inventory was 65% off of its 2021 highs, which should’ve been an incredible massive “cut price purchase” signal for Amazon.
This isn’t the ‘Zon’s first enterprise into the patron robotics market. We talked about (learn: poked enjoyable at) Amazon’s Astro, which was a cute lil’ Alexa-enabled house robotic that introduced with it a number of privateness issues.
I do know, I do know, foolish me, considering any sense of privateness nonetheless exists … however you would no less than not stick one other robotic eavesdropper in your own home, for a begin! I digress…
It’s solely a matter of time (or Prime Days) earlier than we see what Amazon does with its inherited robotic tech from iRobot, and I, for one, don’t welcome our new Amazon overlords.
No. 2: EXPEDIAAAA
If you happen to didn’t hear a rousing refrain of “dot cooooooom!” in your head simply then, I’m not gonna be mad … simply upset.
Thanks, dad, can we get on with the present now?
Ahem, sure. As you would possibly wager, Expedia (Nasdaq: EXPE) earnings simply echoed what Airbnb (Nasdaq: ABNB) reported earlier this week: That is the journey season of all journey seasons.
It’s no shock, both: After two years of isolation and being cooped up with the fam, it’s time for everybody to stretch their legs a bit. For Expedia, which means extra customers on its journey websites, together with the OG Expedia, Lodges.com, Vrbo (which is like Airbnb however 20% cooler), Travelocity, Hotwire and Orbitz.
The truth is, Expedia stated that income is up 51% from a 12 months in the past, coming in at $3.2 billion and handily beating estimates for $2.99 billion. That places final quarter an entire 1% forward of 2019’s second quarter.
Expedia won’t be recovering/rising its gross sales as fast as Airbnb … however the firm posted glowing outcomes and additional proved that journey is now lastly above pre-pandemic ranges. For this valiant effort, Expedia was rewarded with … erm … a meager 4% rally that was erased at this time.
Hey, it’s the thought that counts, proper? No? Alrighty then.
No. 3: You Block Head, You Blew It!
Ever since Block (NYSE: SQ) pulled a Prince and have become “the corporate previously generally known as Sq.” … Block’s been making an attempt to do something and all the things to impress buyers and bust out of that L 7 sq..
Mixing Prince and Rick James? Gutsy, however I’m about it.
Downside is, between the corporate’s foray into crypto buying and selling, its Bitcoin hodling à la MicroStrategy and its money-transferring Money App … all of the ugliness got here out in Block’s report. And there’s no renaming your means outta this one.
Per-share earnings got here in at $0.18 and barely beat estimates for $0.16. Income, then again, is a extra sophisticated story. The Money App that Block all the time overestimated? Yeah … income there fell 34%.
Then, when you take bitcoin out of the equation, complete income truly grew 34% on the quarter, in all probability due to Block’s fee terminal enterprise. However similar to with MicroStrategy (Nasdaq: MSTR) earlier than it … we are able to’t merely take bitcoin out of the equation, now, can we?
Block reported a $36 million impairment cost on its bitcoin holdings. Although keep in mind: This solely represents the bottom level of Block’s holdings through the quarter — not what it ended the quarter with.
It’s not a loss ‘til you promote, haha… Please, any individual revive SQ inventory.
Sorry, however after a report like that, SQ dropped one other 5%, although the shares managed to rally again to breakeven by the tip of the day.
What I need to know is why anybody — Block, MicroStrategy, even your pal Jim down the road — would purchase and maintain bitcoin this present day. I imply … we simply talked to Mike Carr about a greater strategy to play crypto’s crazes and crashes.
Click on right here to catch up!
No. 4: DKNG … DONKEY KONG IS HERE
Wait, are you able to truly purchase Donkey Kong inventory? You’re solely telling me this now?!
No, I want, however we’re speaking concerning the different DK at this time — DraftKings (Nasdaq: DKNG), the sports activities betting platform simply reported bang-up earnings.
Granted, “bang-up earnings” may be an excessively optimistic strategy to say that the corporate continues to be dropping cash … however it’s not dropping as a lot cash as analysts anticipated. So DraftKings has that going for it, I assume?
Earnings got here in at a lack of $0.50 per share, topping estimates for a $0.75 loss per share. Income, then again, reached $466 million and beat expectations for $439 million with room to spare.
However let’s be actual right here: It is a sports activities betting firm, and we’re both in or about to be in a recession, drying up discretionary earnings for a lot of shoppers. Will individuals carry on playing as they pay increased and better costs for, , actually all the things?
Properly yeah, have you ever met a playing addict earlier than? Additionally, how do you suppose they’re elevating money for fuel?
Touché, voice inside my head. Touché.
CEO Jason Robins has some perception on how the enterprise is weathering the financial storm: “Buyer engagement stays sturdy, and we proceed to see no perceivable affect from broader macroeconomic pressures.”
Nice sound chunk, however simply how sturdy is “sturdy?” Right here’s a clue: In its report, DraftKings additionally famous month-to-month distinctive paid customers had been up 30% 12 months over 12 months, reaching 1.5 million. Higher nonetheless, the corporate is making 30% extra off of every person in comparison with final 12 months.
DKNG merchants despatched the inventory hovering 16% at this time, and that’s on high of its 20% pre-earnings rally over the previous week.
Are any of y’all holding DraftKings inventory? Is anyone folding? Let me know your individual finest bets within the inbox: GreatStuffToday@BanyanHill.com is the place you may attain us finest.
Within the meantime, right here’s the place you could find our different junk — erm, I imply the place you may try some extra Greatness:
Regards,
Joseph Hargett
Editor, Nice Stuff
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