Worst Performing
Tough day for travel ✈️ and solar ☀️.

$CCL, $NCLH, $UAL, $CZR, $SEDG, and $ENPH are all among the worst-performing stocks in today's market. Let's take a look at their recent fundamental performance to see if this is well deserved or an overreaction.

Each of these companies are down more than 5% during today's trading session.

Each of these companies are also down more than 30% from their recent highs but have seen explosive growth with the reopening of the economy.

Despite this growth, only the two solar companies saw positive net income in the most recent quarter.

After accounting for their recent sell-offs. Here is how these stocks compare based on their forward revenue expectations.

What do you think? Are these sell-offs warranted? Are any of these stocks attractive at current prices? Why, or why not?
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I sold back my original Daqo position last week. It was up 52% in less than 2 months; I left the profit in the position. If I get lucky like that, I’m not greedy. Today was their biggest drop I’ve seen in a bit.
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Airlines are firing on all cylinders
This summer's travel season is going to be massive.

United Airlines CEO said, "I’ve never seen in my career, and I’ve been in this industry a long time...such a hockey stick increase of demand."

Airlines are doing everything they can to get more pilots. Many are even dropping 4-year degree requirements.

While companies like $TGT and $PTON complain about excess inventory, $AAL $UAL and other airlines are complaining of a labor shortage.
Employee Efficiency
With Elon Musk talking about cutting 10% of jobs at Tesla $TSLA, the market has taken a hit. Many other companies have recently instituted a hiring freeze or laid off some employees.

Let's look at some industries to see the relationship between employee count and revenue!

Airlines✈️ -

Delta $DAL seems to be the only outlier generating more revenue than both $AAL and $UAL with fewer employees.

Retail 🛍️-

Costco $COST seems to have a large advantage generating more than double the revenue the expected revenue per employee.

Auto 🚗 -

Speaking of Elon, Tesla $TSLA doesn't seem to have a large advantage in this stat. In fact, both Ford $F and GM $GM look to be performing better based on this metric.

Software 💻 -

There doesn't seem to be any strong outliers for SaaS stocks. However, looks to have $DDOG has a slight advantage and $OKTA seems to have a slight disadvantage.

Like what you see?

You can make any of these charts in just three clicks from our home page!
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Did you travel over Memorial Day?
The surge in consumer demand, staff shortages, harsh weather, and high gas prices caused cancellations for many airliners.

Even still, could this increase in demand be an indicator of improved business fundamentals?

Although travel demand has risen in recent months, stock prices for top airliners have continued to fall. $UAL $ALK $AAL $JBLU $DAL $LUV

Counter to the drop in prices, these stocks have seen large increases in quarterly revenue production.

Not all growth is good growth.

As prices for fuel and staff shortages have put pressure on margins, only three of these airlines posted positive net income in their most recent quarter.

For some investors, free cash flow is the better measure of profitability as it shows the cash generated by a business over a given period.


What do you think? Are you a fan of airline stocks now that travel demand is booming?

If you are more of a fan of hotel stocks, or booking sites, Wiijii has you covered with these quick comparisons:


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I did travel over Memorial Day weekend--by car. And since I don't have a Tesla I was feeling well aware of the gas prices. Interesting to see $DAL topping revenue but with negative FCF. What's that about?
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Philly Fed, Powell Speech, More Earnings: Daily Contrarian, April 21
Good morning contrarians! Stock futures are rising after Tesla ($TSLA) and United Airlines ($UAL) posted encouraging results after the close yesterday.

There are a lot more earnings on tap this morning, with AT&T ($T) just coming in mixed. The Philly Fed and a speech by Jerome Powell are other highlights.

Today’s briefing and podcast are free for all so check it out!

Housing Starts, Beige Book, Earnings: Daily Contrarian, April 20
Good morning contrarians! Netflix ($NFLX) is tanking after the company posted disappointing subscriber figures, taking streaming competitors with it…

Several earnings up today: Anthem ($ANTM) just beat on top- and bottom-line estimates. Later this morning we’ll hear from Baker Hughes ($BKR) , Abbott Labs ($ABT), and Procter & Gamble ($PG) .

After the close this afternoon we’ll get Alcoa ($AA) , United Airlines ($UAL), Kinder Morgan ($KMI), and Tesla ($TSLA). Of course Tesla has to report on 4/20.

Read all about it, or listen to the podcast here:
Earnings Week (April 18) 1-day price action
We are up for another busy week of earnings! Here are the reports I will look into and how the stocks performed historically, 1 day after the earnings release.
My favorite earning plays this week are $JNJ $PG and $DHR. $SNAP is a good "lottery" play for the more courageous among us!
I will definitively avoid $TSLA and $NFLX on earning day.
Jonhson & Johnson $JNJ - April 19 before the open.
1-day performance in the past 12 quarters:
  • Average returns = +1.2% 🟢
  • Average price move = + / - 1.9%
  • % of positive returns = 75% 🟢

Netflix $NFLX - April 19 after the close
1-day performance in the past 12 quarters:
  • Average returns = -3.9% 🔴
  • Average price move = + / - 7.1% ⚠️
  • % of positive returns = 17% 🔴

Procter & Gamble $PG - April 20 before the open
1-day performance in the past 12 quarters:
  • Average returns = +1.0% 🟢
  • Average price move = + / - 2.0%
  • % of positive returns = 67% 🟢

Tesla $TSLA - April 20 after the close
1-day performance in the past 12 quarters:
  • Average returns = -1.2% 🔴
  • Average price move = + / - 6.5% ⚠️
  • % of positive returns = 33% 🔴

United Airlines $UAL - April 20 after the close
1-day performance in the past 12 quarters:
  • Average returns = -2.3% 🔴
  • Average price move = + / - 4.2%
  • % of positive returns = 33% 🔴

Danaher $DHR - on April 21 before the open
1-day performance in the past 12 quarters:
  • Average returns = +1.6% 🟢
  • Average price move = + / - 2.1%
  • % of positive returns = 75% 🟢

American Airlines $AAL - April 21 before the open
1-day performance in the past 12 quarters:
  • Average returns = +0.3% 🟢
  • Average price move = + / - 4.2%
  • % of positive returns = 50% 🟢

$SNAP - April 21 after the close
1-day performance in the past 12 quarters:
  • Average returns = +10.3% 🟢
  • Average price move = + / - 20% ⚠️ 🎢 ⚠️
  • % of positive returns = 58% 🟢
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What to watch
Are you prepared to take on the markets this week? If not, here’s a helpful watchlist of some of the most anticipated events for the week beginning April 4th to help you navigate your investing and trading decisions. Like, share and save this post for reference. Also be sure to follow me so that you never miss any upcoming market catalyst events. If you find this helpful and would like to view more of my work, consider subscribing to my Patreon. Link in my bio. $SPY $ABBV $GD $TSM $QQQ $BTC.X $HOOD $TLRY $LEVI $AAL $DAL $UAL $LUV $CHNG $UNH $LMT
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If oil goes to $200, here's what I'm bullish & bearish on
Bearish:
$UBER $LYFT $DASH $GRUB and other gig economy transportation platforms
$AAL $UAL $DAL $LUV and other airlines
$KNX $JBHT $USX $SNDR and other trucking companies

Bullish:
$TSLA $F $GM $RIVN $LCID $FSR and other electric vehicle manufacturers
$SEDG $RUN $ENPH $TAN and other solar stocks
$XOM $CVX $OXY $PXD $COP and other oil stocks

Oil companies today have pricing power like never before. Automakers have pricing power like never before. Solar companies, they'll soon start jacking up their prices as demand for solar energy systems surges during the summer.

Meanwhile, fewer people are gonna use their vehicles to offer ridesharing services and food delivery services because already, fuel costs are eating up a majority of their earnings. Also, airlines will have to balance between finding ways to attract passengers to fly with them (through lower prices) and not deterring them through higher prices (since they want to pass down the higher fuel costs to customers).

Trucking companies have it the worst. The industry has been commoditized as all truckers are essentially independent contractors with their own trucks and they do their own deliveries. The smaller companies are more vulnerable to high oil prices. Meanwhile, the larger trucking companies will have to bump pay for truckers to justify them making deliveries amid the high fuel costs.

These times are unprecedented. We need to drill more oil. Bring back the fracking revolution. The OPEC cartel members have an incentive to produce a lot more oil than their current production target.

Reactivating nuclear power plants takes months or even a few years. Quadrupling down on renewables requires heavy investment and a lot more raw materials, which we are currently struggling to import. Plus, transitioning to a green energy economy takes a very long time. The green energy solutions we currently have aren't dependable. The wind doesn't blow all the time. The sun doesn't shine all the time and it doesn't shine every day and every month. Geothermal plants and hydroelectric plants can only be built in certain places. Biomass may seem viable but we don't want to cause food prices to rise because we're now removing food supply for the sake of energy production.
I don't argue that higher oil prices are good for ALL EV makers, but I can't rationalize the valuations of $RIVN $LCID $FSR and others. While I do believe $TSLA is wildly undervalued (watch their EPS growth this year), too much unearned credit has been given to others trying to follow in tesla's footsteps. These new players have a long way to go before justifying their current valuations, let alone any future growth.
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Happy Sunday all! Here's some weekend reading:

This week:

  • Market Recap
  • Macro of the Week - The Hiking Cycle
  • Earnings - Banks [$GS & $MS], Consumer Staples [$PG], Transportation [$UNP & $JBHT], Airlines [$UAL & $AAL] & Mining [$AA]
  • The Week Ahead - Event Calendar
  • Closing Thoughts - Does a Market Bottom Matter?

Next
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