The $SNAP That Snapped Back

Tale of the Tape

Good evening, folks. Today was quite the turnaround Tuesday.

Stocks struggled out the gate, but bounced back as the major indices closed mixed. The S&P 500 and Dow Jones both finished higher after being down ~2% early. 

The Qs crumbled, but closed the day just barely lower. The Nasdaq 100 ETF was down as much as 3.55%— $QQQ closed off just 0.30%.

Energy was once again the strongest sector. ⚡ $XLE has rallied higher 6 out of the last 7 days. Financials and industrials both closed at new all-time highs. Healthcare, tech, and consumer discretionary all closed lower. 

Tesla tumbled another 2%. $TSLA was down 13% intraday, ticked a low of $619, then ripped back above $700. 💸 Here’s the freaky 5-minute chart:

$CCIV got crushed 38% after Lucid Motors officially confirmed a merger. See more below. 🚗 💨

Workhorse was taken to the woodshed 🔨 ($WKHS ▼ 47%) as the company failed to secure a contract with the USPS. Instead, Oshkosh Defense will finalize the design of the Next Generation Delivery Vehicle (NGDV).

Snap surged to an all-time high after the company said it expects revenue to increase by 50% for the next few years. $SNAP snapped back from double-digit lows to close up 11%. 👻

Here are the closing prints: 

S&P 5003,881+0.13%
Russell 20002,231-0.88%
Dow Jones31,537+0.05%

Snap Sees Strong Growth 👻

Word’s out that Snap Inc. (Snapchat’s parent company) expects its revenue to increase 50% or more for the next couple of years. 🚀

The company attributes the expected growth to Snapchat’s advertisers and new augmented reality capabilities. It also definitely doesn’t hurt that about 5 billion snaps are created each day. 🤭 At Snap Inc.’s first investor day ever, Senior Product Director Peter Sellis said:

[Snap] is in a position to drive multiple years of 50%-plus revenue growth. 

Snap calls itself a ‘camera company’ with a mission to empower people through self-expression. Maybe that’s the reason for the company’s insane growth since 2015:

$SNAP sailed to another all-time high— it reversed and ripped to close up double-digits. The stock had more than a 25% intraday price swing [$56.83 – $72.95]. Here’s the 5-minute chart:

And the daily:

A Not So ‘Lucid’ Dip

There’s an old stock market saying that goes ‘Buy the Rumor, Sell the News.’ Some traders saw this first-hand after $CCIV fell ~40% following its official confirmation of a merger with Lucid Motors.

Here’s the daily chart:

Lucid could generate $4.4B in cash from a $24B valuation. The company intends to build out its manufacturing plant in Arizona.

Sometimes stocks go up, and sometimes they go down.        ¯\_(ツ)_/¯ 

Here’s the official press release.

Powell Presents

Today, Federal Reserve Chairman Jeromel Powell delivered his semiannual monetary policy report to Congress. 🇺🇸 💰

Powell eased concerns over rising interest rates, implying central bank interest rates remain far-off. 

The Chairman said inflation looks soft, below the Fed’s 2% goal. The Fed will continue aiding the economy with near-zero interest rates and asset purchases until further progress is made.

Mr. Powell said: 

The economy is a long way from our employment and inflation goals. 🤷

Earnings Round-Up

Square reported earnings after the close. Gross profits increased 59% YoY while Cash App profits more than doubled.

Here are the numbers:

EPS: $0.04 vs ($0.16) est.
Revenue: $3.16B + 141% YoY

The company shared:

In the third quarter of 2020, gross profit grew 59% year over year to $794 million, and excluding Caviar from the third quarter of 2019, gross profit was up 63% year over year. In our Seller ecosystem, gross profit was up 12% year over year during the third quarter…

Our Cash App ecosystem delivered strong gross profit growth of 212% year over year. We remain focused on increasing daily utility for our Cash App customers to products beyond peer-to-peer payments, which helps drive higher engagement and monetization.

$SQ stumbled ~5% after hours. 

Tiger Woods Involved in Car Crash

Source: CNN

Today around 7:12am PT, the LASD responded to a 911 call about a crash near Rancho Palos Verdes where a vehicle had “sustained major damage.”

The driver was later identified as Eldrick ‘Tiger’ Woods as he was removed from the SUV with the “jaws of life.” 

Unfortunately, according to his agent Mark Seinberg, Woods suffered several leg injuries during the crash and immediately entered surgery at the hospital.

The PGA issued a statement supporting Tiger and wishing him a speedy recovery. We do as well, and fingers crossed he’s okay. 🤞🏼 

Earnings This Week

Be sure to know when your stocks report earnings. Here’s the earnings calendar

Links That Don’t Suck

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💡 Coin Metrics’ State of the Network: Issue 91

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💸 The Reformed Broker: Substack Vertigo

🛋️ Andrés Reisinger Sells Collection of “Impossible” Virtual Furniture for $450,000

🖼️ Experts Confirm Edvard Munch Wrote a Secret Message on The Scream

🧠 The Psychology Behind the Boom in Collectibles