IPOs Are Back
By Wed, Aug 26, 2020
Hey Scoopers,
The market stayed rather stable in anticipation of the highly-expected Jerome Powell’s speech on Thursday. — More on that in the “Overall Market” section.
Beyond the overall market, a neutral rating was worth a 23% stock price jump, while a 156% jump in online sales ended in almost 4% stock price fall. Ironic, isn’t it? — More on that in the “What’s Up?” and “What’s Down?” sections.
Oh, by the way, the 2020 IPO dry spell, excluding SPACs, has come to an end. — More on that in the “Water Cooler” section.
But, first, here is a recap of what happened in the market yesterday:
Market Recap
- U.S. markets: The indices didn’t agree on the direction, however, they didn’t move too much either. Scroll down to the “Overall Market” section to read more.
- Cryptocurrency: Bitcoin’s price slipped below $11,500 mark on Tuesday.
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Stay Tuned…
The Dow index didn’t follow the other two indices and finished the day in red, but only barely. The Nasdaq and the S&P 500 indices had a green day, once again. Of course, all eyes are on Chairman Jerome Powell, who is expected to give a potentially market-moving speech about the Fed’s approach to monetary and fiscal policy on Thursday. Stay tuned…
A 23% Jump For A Neutral Rating
So, what happened?
Shares of NIO (Ticker: NIO) are up more than 22% on Tuesday. This company is sometimes referred to as China’s Tesla (Ticker: TSLA). Analysts from UBS changed their NIO’s rating from Sell to Neutral. That was pretty much it. Investors who have been waiting for any good news about NIO liked a Neutral rating and valued the company 23% higher than before.
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How Long Can It Last?
So, what happened?
Shares of Best Buy (Ticker: BBY) were down by almost 4% on Tuesday. The company announced its quarterly earnings report, and the report was full of interesting surprises. Despite the COVID-19 pandemic, comparable sales increased by 5.8%, and comparable online sales were up by 242%. Diluted earnings per share and non-GAAP diluted earnings per share were also up. Also, a few financial analysts increased their price target for the company’s stock. There wasn’t anything to worry about in the company’s performance, except that investors may be wondering how long would the need for work-from-home tech supplies last and whether BBY can keep growing as it has done so in 2020. A good question to ponder upon. Although would investors ask the same question from let’s say Amazon (Ticker: AMZN)?
Two Exciting IPOs
So what happened?
The first half of 2020 seemed to be a dry IPO season. The excitement was still there due to the surge of IPOs via mergers with SPACs. However, the second half of the year is getting exciting. We told you about Silicon Valley’s darling Airbnb’s confidential filing for an IPO. This week, two exciting new candidates have emerged:
- Palantir, the mysterious and apparently-cash-rich startup, filed for a direct listing. It means, the company doesn’t want to raise any cash from its IPO and would just want to give its shareholders, including the IPOs, a chance to liquidate some of their tied-up assets.
- Ant Group (Financial) from China is the second exciting IPO news of the day. The company is going to file its IPO to be listed on Nasdaq competitor, Hong Kong Stock Exchange. It is expected that this IPO will be the biggest one yet.
We’ve got an arbitrary question for you. If you had to choose one of these new IPOs, Airbnb, Palantir, and Ant Financial, which one is your first pick and why?
Our email address is members@tradestocks.com. Let us know if you have any questions, feedback, or ideas.
Authors of this Scoop own shares of Tesla (Ticker: TSLA) and Amazon (Ticker: AMZN).
About the Author
The authors of this Scoop are the editorial team at Stock Card, led by Hoda Mehr. Hoda Mehr is CEO and Co-founder of Stock Card and the host of Renegade Investors podcast. She runs a community of 40,000 stock market investors and manages Stock Card's successful flagship portfolio, Roll with Our CEO, on Stock Card Portfolio Store. Hoda is an Economist with an MBA from Concordia, John Molson School of Business. She applies behavioral economics, data journalism, and storytelling to all aspects of her work. Before starting Stock Card, Hoda worked as a strategy and insights lead at technology companies including Symantec, Aimia and Sony. Create a free account to do your stock market research easily and mistake-free: Stock Card Stock Card
