1/ Palantir (PLTR)
2/ Super Micro Computer (SMCI
3/ CVS
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1/
Palantir (PLTR)
Palantir (PLTR) has been on quite a run since it was announced and then subsequently added to the S&P 500 back in early September. Shares have rallied by as much as 47% since that day and trade near all-time highs.
One thing is certain about PLTR when they report earnings – volatility ensues. The AVERAGE move after earnings releases has been +/- 15%. The good news is they have traded higher after five of the last seven releases for an average gain of just over 20%. The two times they traded lower was for an average loss of 10%.
Technically, shares started flagging and remain in a strong uptrend. Outside of the outlier day on August 5th (remember the panic from the Yen carry trade?) shares have methodically gone higher.
If we get a negative response post earnings look for two key areas of support to hold. The $36/$37.50 consolidation area of late September would equate to roughly a 10% drawdown (less than an average move in the stock) and could be a good point to nibble. A 20% pullback would get the stock back near the $33 area and a major support area seen on the gap caused by the S&P 500 inclusion news.
To the upside, it may take a great beat and guide to get shares to eclipse the $45 level and continue this major leg higher. Shares have climbed over 100% from the August 5th lows and momentum appears to be slowing.
2/
Super Micro Computer (SMCI
Super Micro Computer (SMCI) reports earnings on Election Day and this may be a great thing for the company as any negative news may be overshadowed by the national headlines.
It’s been a rough week for this once AI darling stock – read more in the week that was below. Shares fell 45% last week and are now 79% off their 52-week highs in just 165 sessions as seen in the chart below.
This quarter will be tricky to navigate as earnings numbers and guidance may be overshadowed by internal and accounting issues plaguing the company. They closed on the lows of the week and their lowest level all year.
3/
CVS
CVS recently lowered their guidance and named a new CEO. Shares tumbled over 15% since that news and are looking to find their footing.
New CEO David Joyner was an internal hire and that fact didn’t wow the street, at least not yet. He has the opportunity to talk about his plan to turn around the health care and retail pharmacy giant.
Technically, we are testing the lows and a key support area here around $55. It may set up to be a good risk/reward play if you believe his message next week will be the first step in a major turnaround. If it can hold then look for a bear market rally in shares back to $60 and possibly to its declining 200-day moving average at $64.
A break and close below this support and watch for shares to continue to head to the $52 level. This was the low bar in 2019 and 2020. Shares haven’t traded lower than this level since 2013.
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Originally posted 5th November 2024
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