Ambastha Financial LLC

By Kuldip K. Ambastha

In this past week, both Asana, Inc. (ASAN) and Palantir Technologies Inc. (PLTR) went public through the direct listing of shares which had been privately held in the past. On Wednesday, September 30, 2020, Asana opened at $27.00 per share while Palantir opened at $10.00 per share. By the end of the trading week on Friday, October 2, 2020, Asana closed at $25.91 per share while Palantir closed at $9.20 per share. Asana is a workplace collaboration and planning software company, while Palantir is a data analytics company.

Based on historical data related to privately held and privately traded shares of both companies before the direct listings, the New York Stock Exchange (NYSE) had expected reference prices of $21.00 per share for Asana and $7.25 per share for Palantir. In general per what research on liquidity shows, publicly traded shares are expected to trade higher than the reference prices. Over the long run, it will be interesting to see if the publicly traded shares of both companies continue to trade higher than the reference prices.

Keywords – Asana, Inc., Asana, ASAN, Palantir Technologies Inc., Palantir Technologies, Palantir, PLTR, technology, tech, New York Stock Exchange, NYSE.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any position in ASAN and PLTR.

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 © 2020 – Ambastha Financial LLC.

By Kuldip K. Ambastha

During the past trading week, Carvana Co. (CVNA) delivered a +30.6% return on Tuesday, September 22, 2020, due to strongly positive financial results showing ongoing growth. Carvana Co. is an innovative retailer which sells cars out of huge vending machines, and during the latest quarter it showed impressive projected data related to retail units sold, total dollar revenue, gross profit per unit, adjusted pre-tax operating profit margin, and adjusted pre-tax operating income. Along with the impressive data seen, Carvana Co. provides great customer experience. Though not yet profitable, the company is on track to profitability within the next few years.

Carvana Co. customers are able to shop for a car across many thousands of available used cars, and then can buy a car in about 10 minutes. The purchased car can then be picked up at a vending machine somewhere in the USA, using a gigantic coin. A father-and-son duo, Ernest Garcia II (largest shareholder) and Ernest Garcia III (Chief Executive Officer [CEO]), are the key individuals behind Carvana Co., which had its initial public offering (IPO) in 2017.

Keywords – Carvana Co., Carvana, CVNA, innovation, growth, used car, retailer.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any position in CVNA.

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 © 2020 – Ambastha Financial LLC.

By Kuldip K. Ambastha

In a volatile week which saw technology (tech) stocks struggle overall, the initial public offering (IPO) of Snowflake Inc. (SNOW) stood out as a star performer. The IPO was priced at $120.00 per share, though the shares opened up on the New York Stock Exchange (NYSE) at an astounding $245.00 per share. Holders of pre-IPO stock would have profited handsomely by selling off their holdings on the first trading day of Wednesday, September 16, 2020. During that day, a high point of $319.00 per share was seen along with a low point of $231.11 per share.

Snowflake Inc. is a tech company which provides clients with the ability to analyze and share large amounts of data and increase data management capacity when needed, versus relying on databases which require capital-intensive hardware. This sort of cloud-based data management is in great demand by a variety of clients.

After three full trading days, the stock had a $240.00 per share closing price at the end of Friday, September 18, 2020. Pre-IPO stockholders who sold their holdings in the last few trading days could have benefited immensely. It is too soon to tell if other investors will benefit from their positions in Snowflake Inc. over the long run. The pop in the share price seen from a starting point of $120.00 per share set off a debate on whether or not the traditional IPO process is broken when it comes to a soon-to-be-public company maximizing the dollars raised. Is a direct listing of pre-existing shares better? Is an IPO driven by a special purpose acquisition company (SPAC) more efficient? Would using a Dutch auction to set an IPO price be advisable? Only time will tell.

Keywords – Snowflake Inc., Snowflake, SNOW, technology, tech, initial public offering, IPO, New York Stock Exchange, NYSE, data management, cloud.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any position in SNOW.

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 © 2020 – Ambastha Financial LLC.

By Kuldip K. Ambastha

(This week’s update is a follow-up to What Caught Our Attention in the Investment World? – Week of October 28-November 1, 2019.) On Wednesday, September 9, 2020, the stock of Tiffany & Co. saw a -6.4% return. Tiffany & Co. (TIF) and LVMH Moët Hennessy (LVMH) (LVMUY) were in the news again this week. Tiffany & Co. is a New York-based company in the luxury jewelry sector. LVMH is a French company headed up by prominent billionaire Bernard Arnault. In late October 2019, the stock of Tiffany & Co. surged due to an unsolicited offer by LVMH to buy the company for $120 per share. If the deal went through, LVMH would have added Tiffany & Co. to a stable of brands including Louis Vuitton, Christian Dior, and Bulgari.

The takeover offer for Tiffany & Co. from LVMH has now become complicated. Why? LVMH received a request from the French government to delay the closing of the deal, plus concerns were raised about how the coronavirus pandemic will affect luxury companies like Tiffany & Co. Legal actions from both sides across the world are to follow in the future. Litigation has already started in the USA, Japan, Mexico, Taiwan, plus various European countries. Negotiations in the future between the two companies may yield a successful takeover effort in the end, Tiffany & Co. may survive as a standalone company, or another bidder may acquire Tiffany & Co. instead.

Due to the coronavirus pandemic cutting off global tourism, Tiffany & Co. has struggled to bring potential customers into its iconic flagship stores, castle-like buildings in New York City, San Francisco, Chicago, Tokyo, Paris, and elsewhere. Also, Tiffany & Co. has had trouble with attracting millennial generation customers to its jewelry offerings, since buying a solitary diamond ring does not appeal to this generation of customers as much as it had to prior generations of customers. Per what commentators have stated, changes in Tiffany & Co.’s marketing efforts, customer experience, brick-and-mortar store presence, and so on likely will be needed in order for the company to be successful going forward, whether or not Tiffany & Co. is acquired by LVMH or another entity.

Keywords – Tiffany & Co., TIF, LVMH Moët Hennessy, LVMH, LVMUY, Bernard Arnault, Louis Vuitton, Christian Dior, Bulgari, U.S., France, luxury, jewelry, retail, M&A, mergers, acquisitions, over-the-counter, OTC, billionaire.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any position in TIF or LVMUY.

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 © 2020 – Ambastha Financial LLC.

By Kuldip K. Ambastha

On Thursday, September 3, 2020, Ciena Corporation (CIEN) had a return of -24.3%. For its most recent fiscal quarter, the technology (tech) company surpassed its profit and revenue expectations, but also announced that in the next few quarters going forward it was expecting a slowdown in orders due to the coronavirus pandemic. On September 3, the company’s stock saw its biggest intraday decline since August 2001 (when many tech stocks were struggling, due to the tech bubble bursting). The company has many clients in the transportation, hospitality, and dining sectors. Since these sectors are struggling, their orders for the offerings of Ciena Corporation will be lessened, going forward.

Keywords – Ciena Corporation, Ciena, CIEN, technology, tech, profit, revenue, orders, slowdown, COVID-19, coronavirus, pandemic.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any positions in CIEN.

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 © 2020 – Ambastha Financial LLC.

By Kuldip K. Ambastha

On Wednesday, August 26, 2020, the stock of Salesforce.com, Inc. (CRM) had a pop of 26.0%. The stock posted smaller positive and negative returns during other days of the trading week. Strong 2Q2020 results drove the 26.0% gain in one day. For the first time, in 2Q2020 Salesforce.com, Inc. had more than $5 billion in quarterly revenues. Despite the strong showing in 2Q2020, the company also will be undergoing significant changes in terms of layoffs. Salesforce.com, Inc. will soon be added into the Dow Jones Industrial Average, but still about 1,000 jobs will be eliminated

Employees impacted by this change will be given 60 days to find new roles within Salesforce.com, Inc. Leaders of the company have said that this plan is needed in order to drive continued growth and customer success in the future. Earlier in 2020, the company had stated that for 90 days there would not be significant layoffs. However, that 90-day period has now passed. Affected employees will be offered re-skilling, re-training, and placement services, though still it is likely going to be difficult for these individuals to find new jobs during these coronavirus pandemic-affected times.

Keywords – Salesforce.com, Inc., Salesforce.com, Salesforce, CRM, Marc Benioff, cloud computing, cloud technology, software as a service, SaaS, customer relationship management, client relationship management, COVID-19, coronavirus, pandemic, layoffs, firings, terminations.

Disclosure – The principals of Ambastha Financial LLC have a short option position in CRM. The clients of Ambastha Financial LLC do not have any positions in CRM.

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 © 2020 – Ambastha Financial LLC.

By Kuldip K. Ambastha

Tesla, Inc. (TSLA) had strong returns for four of the five trading days of this past week, as seen in the table above. In advance of its upcoming 5-to-1 stock split (announced last week on Tuesday, August 11, 2020) which will occur on Monday, August 31, 2020, Tesla closed at an astounding $2,049.98 per share on Friday, August 21, 2020. Tesla has had two consecutive quarters of profitability. The stock may be added into the S&P 500 Index soon, which has resulted in strong buying by investment professionals.

Tesla may, in the near future, benefit from the demand for more electric vehicles in China plus the presence of the Tesla Gigafactory 3 in Shanghai, China. Aside from investment professionals buying the stock aggressively due to the positive information noted here, day-trading individuals on the Robinhood also have been buying the stock voraciously.

Keywords – Tesla, Inc., Tesla, TSLA, Elon Musk, automobile, auto, car, electric vehicle, EV, vehicle, production, Tesla Gigafactory 3, Shanghai, China, Robinhood, 2020.

Disclosure – The principals and clients of Ambastha Financial LLC do not have any positions in TSLA.

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 © 2020 – Ambastha Financial LLC.

By Kuldip K. Ambastha

Eastman Kodak Company (KODK) was prominent in the news again this week. During the week of July 27 – 31, 2020, Eastman Kodak Company stock did well because of the news that it received a $765 million American federal government loan, to help in making coronavirus-related drug ingredients. During this week, the company’s stock instead saw consecutive trading days of negative returns due to several negative news items. The initial surge in the stock price triggered several investigations into potential securities law violations (e.g. insider trading) and the stock options given to key company executives in the days right before the loan announcement was officially made.

The company had spent $870,000 to lobby the U.S. Congress and various federal agencies from April – June, 2020. This large lobbying expense was a sharp departure from recent company history. Because of the negative information coming out, the loan was put on hold pending thorough investigations by the U.S. Congress plus the U.S. Securities and Exchange Commission (SEC). For 2Q2020, the company reported a GAAP net loss (-$5 million). Despite the negative returns for the stock seen in every single trading day this week, Robinhood investors are still quite fascinated by this stock.

Keywords – Eastman Kodak Company, KODK, James V. Continenza, COVID-19, coronavirus, pandemic, Robinhood.

Disclosure – The clients and principals of Ambastha Financial LLC do not have any positions in Eastman Kodak Company (KODK).

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 © 2020 – Ambastha Financial LLC.

By Kuldip K. Ambastha

Tailored Brands, Inc. (TLRD), Seven & i Holdings Co. (SVNDY), and Marathon Petroleum Corporation (MPC) were in the news this past week. Tailored Brands owns retail fashion companies, such as Men’s Wearhouse and Jos A. Bank, and has filed for bankruptcy because of the coronavirus pandemic. The company is looking to restructure and reduce its debts through the bankruptcy process. Its workforce will likely be reduced by 20%, with as many as 500 stores closed.

Seven & i Holdings Co. (SVNDY), a large Japanese diversified retail group (known in the USA as the owner of 7-Eleven Inc.), was also in the news during the past week. Seven & i Holdings Co.’s 7-Eleven entity is buying a business unit (Speedway) from Marathon Petroleum Corporation (MPC), to expand its footprint in the USA. The agreement will include about 3,900 Speedway locations across 35 American states, for a price of $21 billion. 7-Eleven’s footprint in the Midwest plus on the East Coast will be expanded significantly through this purchase.

Keywords – Tailored Brands, Inc., TLRD, Men’s Wearhouse, Jos A. Bank, COVID-19, coronavirus, pandemic, Seven & i Holdings Co., SVNDY, Japanese, Japan, 7-Eleven Inc., American, USA, Marathon Petroleum Corporation, MPC, Speedway.

Disclosure – The clients and principals of Ambastha Financial LLC do not have any positions in Tailored Brands, Inc. (TLRD), Seven & i Holdings Co. (SVNDY), and Marathon Petroleum Corporation (MPC).

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 © 2020 – Ambastha Financial LLC.

By Kuldip K. Ambastha

Until recently, Eastman Kodak Company (KODK) had been best known for its famous camera and photography offerings from the past. The company was founded in 1888, in Rochester, New York. With the rise of new technology offerings such as sophisticated smartphone cameras, Eastman Kodak Company was not in the press as much as in the past. However, things changed massively during this week. In particular, people have been speculating on the company’s stock, with significant daily return fluctuations seen per what is in the table above. Aside from James V. Continenza, the Executive Chairman and CEO of the company, seeing his net worth rise because of his 650,000 shares (plus many stock options), individuals have bid up the company’s shares.

Why? Eastman Kodak Company obtained a $765 million American federal government loan to aid in making coronavirus-related drug ingredients. Because of this business line, the company will be creating 360 jobs as part of its effort to help in the pharmaceutical process around the coronavirus pandemic. Many years ago (1988 – 1994), the company had owned an over-the-counter drug business unit (Sterling Winthrop) which was sold to SmithKline Beechman.

Investors of all kinds, professional or not, showed interest in Eastman Kodak Company, especially on Wednesday, July 29, 2020 when trading halts had to be administered 20 times due to stock price volatility. Over the course of the week, more than 63,000 traders on the Robinhood platform were active in the shares of Eastman Kodak Company. It remains to be seen if the company will continue to see strong interest in its shares going forward from investors of all types.

Keywords – Eastman Kodak Company, KODK, James V. Continenza, COVID-19, coronavirus, pandemic, Sterling Winthrop, SmithKline Beechman, Robinhood.

Disclosure – The clients and principals of Ambastha Financial LLC do not have any positions in Eastman Kodak Company (KODK).

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 © 2020 – Ambastha Financial LLC.