💥 Pop Goes The Bubble

$SMCI does the unthinkable and closes in the red. Plus, bets on DraftKings paid off.

Author

Brooks Dyroff
February 16, 2024

Happy Friday Zingers! Well, Bowser, you win this round. SuperMario — wait, I mean, SuperMicro — got knocked down a peg today, closing down around 20%. It was the stock’s first red day in the last 10.

$SMCI wasn’t the only stock that got hit today. A hot PPI number before the open brought the $IWM down more than 1.5% in pre-market trading. Bulls tried to make a stand, bringing the market back even, but ultimately all major indices closed lower as investors worried inflation might have an extra life.

Oh, mamma mia…

Today’s Price Action:

$SPY: -.50%
$QQQ: -.91%
$DIA: -.37%

Also, check out the brokerage that the pros trust with their portfolios.

And, check out the new episode of the Raz Report here.

TODAY’S MOST VOLATILE STOCKS
ONE TOP MOVER
Excited Episode 12 GIF by The Simpsons

Briefly: Well, if you bet on one of the leading betting stocks today, it paid off.

So Basically: DraftKings ($DKNG) reported earnings after the close yesterday. After trading lower initially, bullish traders swooped in and started betting on the stock.

Back Up: Several analysts at different firms, including Truist and Oppenheimer, have bullish price targets for DraftKings and online and mobile gambling continue to grow throughout the U.S.

So What? The acquisition of Jackpocket could increase the database of users and customers for the company, Oppenheimer’s Jed Kelly said. The analyst said the fourth quarter results highlight DraftKings’ continued strength in the sports betting sector.

What Next: Read more here.

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ONE TRADE IDEA FOR NEXT WEEK

Briefly: NVIDIA’s stock has been an investor darling throughout 2023. The stock gained 246% through the year. But the latest filings revealed hedge funds trimmed their Nvidia stock exposure in Q4 2023.

So Basically: Hedge fund ownership of NVIDIA stock trimmed from 9.13% to 9.07% from the third quarter to the fourth quarter.

So Then: The number of hedge funds with NVIDIA stock in their top 10 holdings reduced from 232 to 211. The total number of 13F filers with NVIDIA stock ownership also reduced from 632 to 615.

So What? It may appear that given the stock’s trajectory through 2023, some of the ownership shedding could be attributed to profit-taking.

That Said: NVIDIA’s put/call ratio grew 22% quarter-over-quarter, from 1.18 to 1.44, signaling increasingly bearish sentiment.

What Next: Read more here.

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