In our weekend digest, we summarize the best pieces published from the working week. These can be read in full by clicking on the link over the name/ticker.
Stocks – a solid week ruined by a Friday crash
We think space travel and the sector is worth snapping up as more and more news comes out. Long term, these companies will be turning over high revenue. Competition is likely to be low as these companies demand huge capital to start up. As a result, the current companies can thrive in the coming years following recent success.
We think there is plenty that can outweigh the risks. Half-year results were positive, with revenues up 71% year-on-year. Profit after tax rose 271% to $12.3bn. This allowed the company to pay out a generous dividend to investors, equating to around 75% of the underlying profits.
Lucid Motors stock is one of the top companies to really compete in the EV market over the next years. The sector should continue to grow as more demand is realised (unless we burst this potential bubble). Lucid looks set to do well as investors can factor in more growth in the upcoming months with the deliveries now in play. It may not have the same astronomical returns that Tesla has had over the past years, but this could still be one of the best opportunities available now.
Online gambling will have more retention than video-conferencing and a treadmill will have. However, as people spend less time at home, the demand will likely move into other gambling sectors and PENN’s thriving online sector may suffer. Combine this with missed earnings that were the main drivers behind Zoom and Peleton sell offs and David Portnoys public troubles, PENN may see more selling pressure below this current support.
From our point of view, the cons still outweigh the pros when looking at Skillz shares. Although the downside is likely more limited at $10 than at early stages this year, we don’t have enough convincing reasons to suggest a meaningful break higher anytime soon. Therefore, we’ll be staying away and think the short interest is largely justified.
The emergence of a super-mutant strain in Africa, the “Botswana variant”, has quickly resulted in the European Union and the UK halting flights and issuing travel restrictions to certain African countries. More countries are expected to follow their foot steps to try stop the spread. Here is the damage so far:
- British Airways owner, IAG, -14% (largest faller in the FTSE100)
- Ryanair, -9%
- Easyjet, -10%
Crypto – looking past the noise to metaverse ideas
All of these names are great picks. Crypto will offer a shorter term reward but you have to take that with more risk. It’s a much more volatile market. The stock options have lower risk, but if you are aiming for a long term investment, the rewards could still be amazing. Either way, make sure you don’t miss this opportunity as the world looks towards the next development.
FX – stopped on EUR/CHF, profitable on USD/ZAR
We were stopped out of our EURCHF position on Friday, with CHF well bid from the European lockdown fears and the new variant chatter. We netted gains intraday from being long USD/ZAR, with the South African Rand struggling to hold ground.