In today’s briefing:
- Bitcoin (XBTUSD) – Recent Decline Is Logical / Necessary / Counter-Trend
- “Sell in May” Another Reason to Be Defensive; Value to Lead?; Buys in Medical Devices, Footwear
- Late April Break for a 6-Week Decline
- Core Business Still Strong with 2023 Off to a Good Start
- Ross Stores Inc.: Collaboration With Adidas & Other Drivers
- Skyworks Solutions Inc.: Working Towards The Future of Connectivity and Mobility – Key Drivers
- Omnicom Group Inc.: Success in Precision Marketing and Public Relations – Key Drivers
- Johnson & Johnson: Continued MedTech & Pharma Expansion – Key Drivers
- OLO’s Dilemma… (part 2)
- Analog Devices Inc.: The Next Big Thing in Mission-Critical Equipment – Key Drivers
Bitcoin (XBTUSD) – Recent Decline Is Logical / Necessary / Counter-Trend
- At TMA we deliver high probability outcomes by focusing on our 3 pillars of technical analysis. 1) Response to key levels. 2) Price action. 3) Momentum confirmation.
- Bitcoin (XBTUSD) confirmed a meaningful top in the past 2 weeks when it rejected material MT resistance levels and completed a bearish weekly reversal pattern.
- With definitive bullish price and momentum triggers in play, we anticipate that a multi-week period of consolidation / correction will remain counter-trend. Searching for the next MT base towards 25200/25250.
“Sell in May” Another Reason to Be Defensive; Value to Lead?; Buys in Medical Devices, Footwear
- The SPX made a high of 4169 last week, tagging our 4165-4200 resistance range. We still believe 4165-4200 will cap upside in 2023, with a reach to 4300-4325 also possible.
- Considering limited upside in both scenarios, and with the seasonably weaker “sell in May and go away” period approaching, we continue to recommend higher allocations to defensives
- This includes Utilities (XLU, RYU), Consumer Staples (XLP), Health Care (XLV, PPH), and gold miners (GDX).
Late April Break for a 6-Week Decline
- Late April capitulation turn unfolding on the SPX trendline break and RTY wedge support breach. We turned bearish (shorting) on April 18 just under SPX 4,200.
- A number of breakdown coming through in Asia – Korea’s bear impulse and Taiwan’s break of trendline support that turns the cycle to bearish. Japan will lag.
- SPX MACD bear turn is in line with our late April bear phase. A cycle trough is due in 6 weeks time (second week of June).
Core Business Still Strong with 2023 Off to a Good Start
- Results recap. EVmo reported record revenues of $12.6 million, up 23% from 2021, on a growing vehicle fleet, higher rental rates from new high-demand cars (Tesla Model 3s), and increased sales efforts.
- Based on the existing fleet today, the company expects annual revenues of more than $18 million, which would imply 40% growth over 2022.
- Consolidated net loss was $7.1 million, an almost $8 million improvement from 2021 due to sales growth and cost controls.
Ross Stores Inc.: Collaboration With Adidas & Other Drivers
- Ross Stores delivered strong fourth-quarter sales and profitability results despite a very competitive holiday season, owing to customers’ positive response to the company’s expanded selection and value offerings.
- The company delivered an all-around beat with earnings per share for Q4 reported at $1.31 on a net income of $447 million.
- These figures compare to earnings per share of $1.04 on net earnings of $367 million for the 13 weeks ended January 29, 2022.
Skyworks Solutions Inc.: Working Towards The Future of Connectivity and Mobility – Key Drivers
- Skyworks Solutions reported a strong first-quarter financial results, with sales above the analyst consensus estimate, robust profitability, and significant cash flow performance.
- In addition to the strong financial performance, Skyworks expanded its design win pipeline in a number of emerging high-growth markets.
- Skyworks expanded its expanding technology portfolio across a growing customer base in IoT.
Omnicom Group Inc.: Success in Precision Marketing and Public Relations – Key Drivers
- Omnicom Group delivered an all-around beat as its revenues increased by 1%, while non-GAAP adjusted operating income remained unchanged.
- Net interest expense decreased as interest income exceeded the company’s expectations.
- We give Omnicom Group a ‘Hold’ rating with a revised target price.
Johnson & Johnson: Continued MedTech & Pharma Expansion – Key Drivers
- Johnson & Johnson reported strong operational performance in the quarter, demonstrating the power and adaptability of Johnson & Johnson as well as its dedication to enhancing global health outcomes.
- They also anticipate a number of pipeline advances in 2023 that will boost confidence in their Pharmaceutical and MedTech companies.
- Johnson & Johnson remains confident in its ability to generate near-term success, long-term growth, and shareholder value creation in the future.
OLO’s Dilemma… (part 2)
- Over the past few weeks I’ve done a handful of checks with competitors and customers in the restaurant-tech industry.
- It was by no means exhaustive but definitely insightful.
- Some were first party conversations; others came from 3rd party expert networks, podcasts interviews (there are lots of good ones out there, by the way) and other vendor white-papers etc.
Analog Devices Inc.: The Next Big Thing in Mission-Critical Equipment – Key Drivers
- Despite significant macroeconomic uncertainty in the first quarter of fiscal 2023, Analog Devices managed to deliver an all-around beat.
- These successes were driven by the company’s unwavering commitment to customer collaboration, the rising demand for cutting-edge technologies, and effective operational management.
- We give Analog Devices a ‘Hold’ rating with a revised target price.
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