In the financial market, feelings don’t count. How I feel what the market will do does not matter. What matters is what the market is doing right now. Nobody can dispute that trades are working. Now nobody knows how long this will last. The pain is still fresh in everyone’s memory and China noise is making people nervous. But having followed the market for years, one thing I have learned – is never to let your feeling come your way of following your trading process. Just do what you see on the screen i.e. follow your methodology and risk management practices. Here’s how the midcap end of the market (stocks with a market cap in the band of $2 billion to $10 billion) doing: trades, opportunities, and interesting stocks.
Why do I like SOFI?
Great Earnings + Bullish Price Action + Healthy Market Environment. The company uses AI to assess credit risk. The company is growing exponentially. Its net revenue last quarter was up 57% and the company has raised full-year revenue guidance to $1.51 billion, representing 50% growth YOY. The company’s user base grew by 450K members last quarter and now has a membership base of 4.3 million.
The most impressive part is: Stock price reaction and how it has sustained the gains. The stock is a buy at cmp
Silvergate SI continues to be my Long term fav stock
It’s never a bad idea to buy a good stock post earnings. I recommended SI post earnings on July 19 around the price of $77, the stock is now at $103. With Congress now working on crypto regulation, this stock has the potential to touch $160.
SWN came out with impressive earnings. The stock is a great fundamental hold.
PAGS was a quick 20% trade
Solar Stocks: RUN, FSLR and NOVA
The Climate Bill is driving solar stocks higher. Last week I recommended FSLR (99.8) and NOVA (at 23.89). These stocks are excellent hold and have a long way to go.
One stock I missed due to the earnings announcement: Sunrun RUN. I will add it if the stock declines near $30
Buy Equitrans Midstream Corp ETRN
This Natural Gas pipeline came with an excellent earnings report, offers a 7% dividend yield, and is a beneficiary of the Climate deal as the company’s Mountain Valley pipeline is expected to be approved.
There is great momentum in Biotech stocks. The big beneficiary is the Highly risky Leveraged ETF LABU
This is not the first time I am mentioning this ETF. After stalling below 10 for some time it finally broke out and now moving higher. It’s leading to breakout in many biotech stocks
Example: SIGA makes a new high on monkeypox treatment
These are highly risky plays and hence not recommending them but one stock I would add – Dynavax DVAX near $16. The company makes the CpG 1018 adjuvant, which is used in coronavirus vaccines. An adjuvant is a substance that enhances the immune response produced by a vaccine. With covid variants spreading around and demand for vaccines continue to be strong, the company has immense potential.
Disclaimer – The state of the market notes is Deepak’s perspective on the market. The column is purely for educational purposes. Nothing contained herein is a solicitation to trade or a recommendation of a specific trade. By reading this publication you agree to make no trade relying in whole or in part on the comments of the writers
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