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🍄 Trippin' Out
Psych stocks get tripped up, Lulu delivers a strong quarter, $NVDA hits new all-time highs and more
Brooks Dyroff
June 05, 2024
Happy Wednesday, Zingernation! Stacking $SPY shares in a long-term port is great, but can get a little boring. Want to add a little risk? You could try trading options. Those looking for something even more daring might venture into the meme stock land and trade names like GameStop. And if that’s not risky enough for you, what about a crypto coin based on a meme stock?
–Aaron Bry & Nic Chahine
Today’s Price Action:
Plus, check out the company that’s making electric vehicles for the air.
TODAY’S MOST VOLATILE STOCKS
TODAY’S TOP STORY
Briefly: Lululemon reported first-quarter financial results Wednesday after the bell. Here’s a look at the key metrics from the quarter.
Q1 Earnings: Lululemon reported first-quarter revenue of $2.21 billion, beating the consensus estimate of $2.2 billion, according to Benzinga Pro. The athleisure company reported quarterly earnings of $2.54 per share, beating analyst estimates of $2.39 per share.
The Numbers: Total revenue was up 10% on a year-over-year basis and total comparable sales increased 6% year-over-year. Americas net revenue increased 3% year-over-year, while international revenue was up 35% year-over-year.
So: Lululemon’s total store count was 711 at quarter’s end. Inventories were down 15% year-over-year. The company ended the quarter with $1.9 billion in cash and equivalents.
Basically: Lululemon also said its board authorized a $1 billion increase to its stock repurchase program, bringing the total remaining amount under the buyback up to $1.7 billion.
Click here to read more.
PRESENTED BY NEW HORIZON AIRCRAFT
New Horizon Aircraft (NASDAQ: HOVR) has announced significant technical updates on its revolutionary hybrid electric eVTOL prototype, the Cavorite X7. With its patented wing system and hybrid power technology, the X7 promises greater speed, range and payload capacity compared to competitors. Key advancements include the validation of its yaw control system and the start of production on its vertical lifting fans, positioning the Cavorite X7 for successful flight tests by mid-summer. Click here to learn more about how Horizon Aircraft is leading the charge in transforming urban and remote transportation.
FIVE MOVERS
NVIDIA continued its torrid run, closing at all-time highs and becoming just the third company to reach a valuation of $3 trillion.
Five Below shares got hammered after the close, trading down nearly 20% after the discount retailer reported worse-than-expected earnings.
Dutch Bros shares had a good day Wednesday, closing up more than 7% after receiving some love from an analyst at TD Cowen.
Psychedelic stocks got tripped up today, with most of the names in the industry trading lower after a significant regulatory hurdle.
Copper prices retreated Wednesday as stockpiles in China grow and investors start to worry about slowing demand.
ONE TRADE IDEA FOR TOMORROW
Briefly: Riot shares traded lower today after Kerrisdale Capital’s Founder and Chief Investment Officer, Sahm Adrangi, issued a report on the stock.
So: Adrangi expressed a bear view on Riot Platforms, a $3 billion Bitcoin miner that excels more in energy arbitrage and stock issuance than in generating shareholder value through crypto mining.
Basically: According to the analyst, Bitcoin mining is one of the worst business models for a public company due to unpredictable revenue, high capital requirements, fierce competition, the commodity nature of the product, and increasing regulatory scrutiny, even in crypto-friendly places like Texas, where Riot operates.
Why It Matters: Given these drawbacks, it is unsurprising that Riot has never produced positive cash flow or a decent return, he flagged. However, it is surprising that Riot’s shareholders tolerate excessive management compensation and frequent dilution.
Click here to read more details from the short report.
PRESENTED BY NEW HORIZON AIRCRAFTS
New Horizon Aircraft (NASDAQ: HOVR) has announced significant technical updates on its revolutionary hybrid electric eVTOL prototype, the Cavorite X7. With its patented wing system and hybrid power technology, the X7 promises greater speed, range and payload capacity compared to competitors. Key advancements include the validation of its yaw control system and the start of production on its vertical lifting fans, positioning the Cavorite X7 for successful flight tests by mid-summer. Click here to learn more about how Horizon Aircraft is leading the charge in transforming urban and remote transportation.