What Caught Our Attention in the Investment World? – Week of November 28-December 2, 2022

By Kuldip K. Ambastha

The stock price of Zscaler, Inc. (ZS), a cloud security company, dropped by -10.7% per share on the trading day of Friday, December 2, 2022. In its latest quarterly results, Zscaler surpassed expectations when it came to earnings and revenues. However, the expected billings figure for the full year is lower than what Wall Street was hoping for, and thus the stock price declined sharply upon this realization. While the company has benefited from increased demand for cybersecurity offerings, it and many other technology companies have struggled in the face of an expected worldwide recession. Zscaler is seeing a longer sales cycle than compared with the past, as potential clients are reluctant to sign contracts as global economic conditions weaken.

Keywords – Zscaler, Inc., Zscaler, ZS, technology, tech, cloud security, cybersecurity, Wall Street, earnings, revenues, billings, demand, recession, sales.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in ZS.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2022 – Ambastha Financial LLC.

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What Caught Our Attention in the Investment World? – Week of November 21-25, 2022

By Kuldip K. Ambastha

On Wednesday, November 23, 2022, the stock price of Coupa Software Incorporated (COUP), a technology company focused on “Business Spend Management,” shot up by +28.9% per share. (See past coverage if needed: “What Caught Our Attention in the Investment World? – Week of March 14-18, 2022; By Kuldip K. Ambastha.”) The company may be acquired by a prominent private equity investment firm, in a buyout deal which could be funded through private credit lenders. While Coupa has easy to understand and easy to use offerings, the company has struggled in the recent past when looking at performance metrics such as sales, earnings, and adjusted net income. Nonetheless, perhaps the stock price of Coupa has fallen to such a level as to make a private equity buyout attractive with the strategy of buying at a discount, restructuring the company, and then selling it later for a premium.

Keywords – Coupa Software Incorporated, Coupa Software Inc., Coupa Software, Coupa, COUP, technology, tech, Business Spend Management, private equity, buyout, private credit, sales, earnings, adjusted net income, discount, restructure, premium.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in COUP.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2022 – Ambastha Financial LLC.

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What Caught Our Attention in the Investment World? – Week of November 14-18, 2022

By Kuldip K. Ambastha

On Thursday, November 17, 2022, the stock price of Bath & Body Works, Inc. (BBWI), a prominent specialty retail company, rose by +25.2% per share. This rise in the stock price was driven by strong 3Q2022 quarterly performance results, with earnings surpassing the expected consensus estimate. Furthermore, Bath & Body Works, Inc. has raised its calendar year profit expectations. Corporate management is expecting a strong winter holiday gift purchasing period coming up. Also, Wall Street equity research analysts were impressed with the company’s expense management and inventory management endeavors.

Keywords – Bath & Body Works, Inc., Bath & Body Works, Bath & Body, BBWI, specialty retail, 3Q2022 quarter, calendar year, winter holiday, Wall Street, equity research, expense management, inventory management.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in BBWI.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2022 – Ambastha Financial LLC.

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What Caught Our Attention in the Investment World? – Week of November 7-11, 2022

By Kuldip K. Ambastha

YETI Holdings, Inc. (YETI), an outdoor products company, had its stock price shoot up by +31.6% per share on Thursday, November 10, 2022, followed by another +10.0% per share on Friday, November 11, 2022. The company announced strong performance results in 3Q2022, and this information drove the increase in the stock price. Due to excellent net sales and despite net profits being affected by cost inflation, revenues and earnings in 3Q2022 both beat their respective consensus estimates. While concerns about consumer spending have been on the minds of investors in 2022, still YETI has been able to perform well in part because of its growing international (non-U.S.) operation. That all said, corporate management still sounded notes of caution linked to uncertainties (related to consumer spending, cost inflation, and supply chain management) heading into the 4Q2022 winter holiday quarter.

Keywords – YETI Holdings, Inc., YETI Holdings, YETI, outdoor, products, performance, sales, profits, revenues, earnings, cost, inflation, consensus, estimates, consumer, spending, international, non-U.S., supply chain management, 3Q2022, 4Q2022.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in YETI.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2022 – Ambastha Financial LLC.

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What Caught Our Attention in the Investment World? – Week of October 31-November 4, 2022

By Kuldip K. Ambastha

On the trading day of Tuesday, November 1, 2022, Johnson & Johnson (JNJ), a major pharmaceutical and medical product provider, announced plans to acquire Abiomed, Inc. (ABMD), a medical device maker. Due to this development, for that day the stock price of Abiomed rose sharply by +49.9% per share, while the stock price of Johnson & Johnson declined by -0.5% per share. Johnson & Johnson will acquire Abiomed for $380 per share in cash, putting an end to Abiomed’s highly volatile tenure as a public company. As Abiomed’s aggregate market value increased over time, investor skepticism around future growth prospects for the company’s offerings also increased. In contrast, Johnson & Johnson by making this acquisition is placing a bet that Abiomed’s medical device products have strong growth prospects which can enhance Johnson & Johnson as a company.

Keywords – Abiomed, Inc., Abiomed, ABMD, Johnson & Johnson, JNJ, pharmaceutical, medical, acquisition, acquire, growth, skepticism.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in ABMD. The principals of Ambastha Financial LLC have no positions in JNJ, while the clients of Ambastha Financial LLC have long equity positions in JNJ.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2022 – Ambastha Financial LLC.

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What Caught Our Attention in the Investment World? – Week of October 24-28, 2022

By Kuldip K. Ambastha

On Thursday, October 27, 2022, the stock of Credit Suisse Group AG (CS), a prominent Swiss financial institution with operations around the world, had a steep price drop of -20.0% per share for the trading day. Credit Suisse Group in the recent past has had troubles linked to the scandals around Greensill Capital and Archegos Capital Management, and has the potential to become a “meme stock” if the stock price continues to decline. In 3Q2022, Credit Suisse Group reported a quarterly pre-tax loss, and also announced a strategic overhaul restructuring plan which will change the institution significantly going forward.

This highly complicated, long-term plan includes resurrecting a Credit Suisse First Boston (aka: CS First Boston, aka: CSFB) investment banking unit to be led by star dealmaker Michael Klein with the hopes of an eventual initial public offering (IPO), laying off many current employees, changing senior management professionals, focusing more on wealth management, and raising additional capital, among other action items. The central bank [Swiss National Bank (SNB)] of Switzerland (aka: the Swiss Confederation) is supportive of the plan, while Credit Suisse Group’s Swiss regulator [Swiss Financial Market Supervisory Authority (FINMA)] seems guarded. Many details still need to be fleshed out further, and accordingly Wall Street equity research analysts and Credit Suisse Group shareholders are currently mixed in their viewpoints on the plan based on the limited details now available.

Keywords – Credit Suisse Group AG, Credit Suisse Group, Credit Suisse, CS, Credit Suisse First Boston, CS First Boston, CSFB, Michael Klein, Greensill Capital, Archegos Capital Management, financial institution, Switzerland, Swiss Confederation, Swiss, Swiss National Bank, SNB, Swiss Financial Market Supervisory Authority, FINMA, 3Q2022, overhaul, restructuring, meme stock.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in CS.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2022 – Ambastha Financial LLC.

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What Caught Our Attention in the Investment World? – Week of October 17-21, 2022

By Kuldip K. Ambastha

On Thursday, October 21, 2022, the stock price of The Allstate Corporation (ALL), an insurance provider operating in the USA plus Canada, dropped by -12.9% per share, with a mix of various factors leading to the stock of The Allstate Corporation having troubles on this trading day. On a high level, participants in the stock market have become increasingly bearish over the course of 2022, with Allstate immune in the past but more likely to be affected going forward due to the factors noted below. Increased premiums on insurance policies are not offsetting increased payouts due to Hurricane Ian and other occurrences. Furthermore, Allstate’s pool of funds used to fund coverage payouts has not grown significantly in 2022, while Allstate is unable to aggressively increase premiums (to account for higher inflation) without potentially losing customers. In summary, such negative factors are weighing heavily on the stock price of Allstate.

Keywords – The Allstate Corporation, Allstate Corporation, Allstate, ALL, insurance, insurer, USA, Canada, premium, payout, policy, funds, coverage, inflation, customers, Hurricane Ian, bearish, negative, sentiment.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in ALL.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2022 – Ambastha Financial LLC.

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What Caught Our Attention in the Investment World? – Week of October 10-14, 2022

By Kuldip K. Ambastha

The stock of BeiGene, Ltd. (BGNE), a commercial stage biopharmaceutical company focused on cancer treatment drugs, saw a +20.5% increase in price per share on Wednesday, October 12, 2022. Brukinsa (zanubrutinib) in its Phase 3 trial data showed highly positive results in people with chronic lymphocytic leukemia (CLL) or small lymphocytic lymphoma (SLL), in an independent review. The drug was well-tolerated in patients, and showed superior progression-free survival (PFS) in individuals compared to rival drugs already available to patients. The European Medicines Agency’s Committee for Medicinal Products for Human Use (EMA’s CHMP) has issued a positive opinion on Brukinsa. If the relevant regulatory agencies eventually issue final approvals for the use of Brukinsa in people around the world, BeiGene may have a bright future.

Keywords – BeiGene, Ltd., BeiGene, BGNE, Brukinsa, zanubrutinib, biopharmaceutical, cancer, treatment, drug, Phase 3, trial, chronic lymphocytic leukemia, CLL, small lymphocytic lymphoma, SLL, progression-free survival, PFS, European Medicines Agency, EMA, Committee for Medicinal Products for Human Use, CHMP, regulation, approval.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in BGNE.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2022 – Ambastha Financial LLC.

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What Caught Our Attention in the Investment World? – Week of October 3-7, 2022

By Kuldip K. Ambastha

The stock price of Twitter, Inc. (TWTR), a microblogging and social networking technology (tech) platform, had a +22.2% per share increase on Tuesday, October 4, 2022, while the other four trading days showed negative daily returns. (See past coverage if needed: “What Caught Our Attention in the Investment World? – Week of November 29-December 3, 2021; By Kuldip K. Ambastha.”) Though the outcome is still uncertain due to funding, litigation, and other open issues, Elon Musk may proceed with his offer to purchase Twitter and convert it into a privately held company. Shares of Twitter were bid up because of this development, with investors seemingly eager to see what plans Musk may have in store for Twitter. Many commentators currently view Twitter as digital town square for the public, and one highly circulated rumor sees Musk restructuring Twitter into an everything app called X.

Keywords – Twitter, Inc., Twitter, TWTR, X, technology, tech, microblogging, social networking, platform, Elon Musk, funding, litigation, public, private, digital town square, everything app.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in TWTR.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2022 – Ambastha Financial LLC.

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What Caught Our Attention in the Investment World? – Week of September 26-30, 2022

By Kuldip K. Ambastha

On Thursday, September 29, 2022, the stock price of CarMax, Inc. (KMX), a used vehicle retailer, dropped by -24.6% per share. The American company’s latest quarterly performance results disappointed Wall Street, especially from the perspective of earnings per share (EPS). The current landscape of high inflation, higher interest rates (making for more expensive vehicle loans alongside stricter credit underwriting standards), and low consumer confidence has lessened the demand for used vehicles. Both individuals and wholesaling companies, the two key customer segments of CarMax, have lowered their used vehicle purchasing activities. Since the used vehicle market is often a leading indicator for where the new vehicle market is heading, in the near future we all may see less demand for new vehicles as well.

Keywords – CarMax, Inc., CarMax, KMX, used, new, vehicle, retailer, retail, earnings per share, EPS, Wall Street, inflation, interest rates, confidence, demand, purchasing, individual, wholesale, customer, consumer, client.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in KMX.

Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2022 – Ambastha Financial LLC.

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