🍨 Daily Scoop: The calm before the storm
By Tue, Sep 10, 2019
Hey Scoopers,
Some of the recent tech IPOs are getting hammered. Investors don’t seem to love these IPOs’ rapid-growth, no-profit model as much as they used to. Beyond that, the overall stock market didn’t have much to celebrate, nor to worry about. Monday was a calm day, atypical of the recent dramas in the global economy.
We got all those stories and more in the “Overall Market,” “What’s up?” and “What’s down?” sections. Scroll down to read.
MARKETS
- U.S. markets:Although the three indices didn’t agree on the direction, the overall market seemed to be taken Monday quite chill. Scroll to the Overall Market section to learn more.
- Cryptocurrency: Bitcoin’s price still hovers around $10,000 per coin. Technical analysts seem to conclude that the price may even fall lower than its current relatively stable $10,000 mark.
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OVERALL MARKET
The calm before the storm!
What happened on Friday?
The stock market remains calm on Monday. The S&P 500 and the Nasdaq inched downward, and the Dow gained just enough to finish in the green zone. It was a calm day, but more like the calm before the storm.
What does this mean?
The Feds are going to meet again soon. High-level representatives from the U.S. and China are negotiating the trade war. The U.K. is dealing with Brexit, and IPOs are calming down. Don’t read into the calm too much!
WHAT’S DOWN
Paging all IPO investors!
So, what happened?
One strangely named tech IPO had a bad day, and the stock was down 13% on Monday. We are paging (ahem, pun intended) all IPO investors to pay attention to PagerDuty (Ticker: PD). As a Unicorn, several well-known venture capital firms backed PagerDuty before it went public. The company is not a household name, but more than 11,600 companies such as Comcast, eHarmony, Slack, and Lululemon use PagerDuty’s cloud-based platform. The stock was down yesterday after the company announced a 45% jump in its revenue during the recent quarterly earnings, but the losses also grew bigger. The stock was also down 11% on Friday.
What’s down? Again!
This was too good not to share it with you. So, we skipped the “What’s Up?” section.
So, what happened?
We expect Ford’s (Ticker: F) stock price to get a big beating in the coming days. It’s not because investors didn’t like the news of all-electric F150 to compete with Tesla. Rather it is because of the company’s new junk rating. Moody’s, which is a rating agency qualifying the company’s creditworthiness, downgraded the company to junk rating. Think about that for a second. One of the most iconic brands in America is getting a junk rating, as investors and credit agencies losing confidence in the company’s ability to turnaround.
WATER COOLER
Shelve that IPO, man.
WeWork’s IPO saga is still going strong. Just last week, we heard that the company is slashing its valuation. In the history of the stock market coverage by this editorial team, we’ve never seen such a strong backlash against an IPO. But, WeWork is getting hammered from all directions. Some of the criticisms are justified.
Take the million-dollar deal between the company’s founder and CEO and the company to sell the right to use the name “We” to the company. Have you ever heard such a convoluted relationship between a founder and his company!
Rumors have it that Softbank, the company’s latest and most prominent investor, is asking WeWork to shelve the IPO, for now. We would have done the same if we were Softbank. You’d want to stay private, work on your brand, solve the CEO issues, and put your best foot forward, before going public.
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
