Ambastha Financial LLC

By Kuldip K. Ambastha

On Monday, November 22, 2021, Vonage Holdings Corp. (VG), a leading telecommunications services corporation, delivered a return of +27.0% per share for the trading day. Why? The key catalyst here was an announcement from Telefonaktiebolaget LM Ericsson (ERIC), more commonly known as Ericsson. Over the weekend, Ericsson stated that it would be purchasing Vonage for $21.00 per share, for an enterprise value total of $6.2 billion. This intended transaction received unanimous approval from the board of directors of Vonage. On Monday, November 22, 2021, Ericsson delivered a return of -7.1% per share for the trading day, as investors processed the high price Ericsson was paying to purchase Vonage. Ericsson intends to use the transaction in order to expand its global presence in wireless telecommunications. The deal will close in the first half of 2022, subject to approval from regulators and Vonage shareholders plus legal and regulatory conditions which may be put into place. The Ericsson / Vonage transaction may prompt other telecommunications sector combinations in the future, as rival firms seek to inorganically gain scale and aggressively expand their own global presences.

Keywords – Vonage Holdings Corp., Vonage Holdings, Vonage, VG, Telefonaktiebolaget LM Ericsson, Ericsson, ERIC, telecommunications, services, wireless, catalyst, purchase, transaction, deal, combination, merger, acquisition, M&A.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in VG or ERIC.

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 © 2021 – Ambastha Financial LLC.

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By Kuldip K. Ambastha

On Monday, November 15, 2021, the stock of Dollar Tree, Inc. (DLTR), a prominent and popular discount variety store chain operator in North America, had a gain of +14.3% per share for the trading day. (See What Caught Our Attention in the Investment World? – Week of September 27-October 1, 2021; By Kuldip K. Ambastha for prior coverage of Dollar Tree.) An activist investment firm named Mantle Ridge has acquired a $1.8 billion stake in Dollar Tree and is pushing for changes which will make the company more valuable in the long run. Mantle Ridge primarily is wanting Dollar Tree to change its pricing structure at Family Dollar, which had been acquired by Dollar Tree in 2015. Furthermore, it is also wanting higher prices at Dollar Tree-branded store locations. Equity research analysts on Wall Street are bullish on Mantle Ridge’s requests, and analyst upgrades of Dollar Tree helped the stock price increase significantly. Expect potentially higher prices at your local Dollar Tree and Family Dollar store locations going forward.

Keywords – Dollar Tree, Inc., Dollar Tree, DLTR, Family Dollar, Mantle Ridge, dollar store, $1, $1.00, North America, Wall Street, equity research, analysts, bullish, upgrades.

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

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 © 2021 – Ambastha Financial LLC.

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By Kuldip K. Ambastha

On Tuesday, November 9, 2021, shares of Roblox Corporation (RBLX), an online gaming and entertainment platform which brings people together over common interests, shot up by +42.2% for the trading day. (See What Caught Our Attention in the Investment World? – Week of March 8-12, 2021; By Kuldip K. Ambastha for prior coverage of Roblox.) This spike was caused by impressive 3Q2021 numbers. Revenues, bookings, daily active users, hours engaged, and other key metrics all grew immensely. However, Roblox is still not a profitable company. The 3Q2021 net loss figure was $74 million, however the company still is showing positive free cash flow. The company also showed strong year-over-year growth. Roblox is hoping that its offerings become a staple of every user’s life even if and when public health conditions around COVID-19 improve, allowing for more opportunities to be out of the house. In a sign that investors may have used the 3Q2021 results to take profits from this highly volatile growth stock, on Wednesday, November 10, 2021 the shares posted a -13.0% loss for the trading day. Though the 3Q2021 results were impressive, perhaps they still were not impressive enough.

Keywords – Roblox Corporation, Roblox Corp., Roblox, Roblox Studio, online, Internet, Web, gaming, entertainment, platform, 3Q2021, year-over-year, users, daily active users, DAUs, creators, revenues, bookings, hours engaged, profits, losses, free cash flow, metrics, growth, volatility, coronavirus, COVID-19, pandemic, vaccinations, public health.

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

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 © 2021 – Ambastha Financial LLC.

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By Kuldip K. Ambastha

On Tuesday, November 2, 2021, Avis Budget Group, Inc. (CAR) returned +108.3% and Chegg, Inc. (CHGG) returned -48.8% for the trading day. Avis, a vehicle rental and mobility solutions company, delivered strong 3Q2021 results and has announced a pledge to expand into using electric vehicles in the future. Avis has benefited from a recent rebound in travel plus an increase in the value of used cars. Chegg, a direct-to-student online learning platform, had weak 3Q2021 results across many metrics and also stated a weakened outlook for 4Q2021 plus the full calendar year of 2021. Chegg has struggled with a significant decline in American and Canadian online traffic, with students enrolling in less classes overall. Also, Chegg has seen lessened revenues since interest in online content has decreased as universities return to in-person classes for fully COVID-19 vaccinated individuals. Legal claims of copyright infringement are also a concern for Chegg, with a highly ambiguous outcome at this point in time. Avis and Chegg had starkly different return profiles on this trading day.

Keywords – Avis Budget Group, Inc., Avis Budget Group, Avis, CAR, vehicle rental, mobility solutions, electric vehicles, EVs, travel, cars, Chegg, Inc., Chegg, CHGG, online learning, education, students, COVID-19, coronavirus, vaccinated, copyright infringement, 3Q2021, 4Q2021, 2021.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in CAR or CHGG.

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 © 2021 – Ambastha Financial LLC.

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By Kuldip K. Ambastha

In this past trading week, Sweetgreen Inc. (SG), a fast-casual restaurant chain, was revealed to be going public via an initial public offering (IPO) on the New York Stock Exchange (NYSE). This IPO was announced in a Form S-1 document filed with the U.S. Securities and Exchange Commission (SEC), stating that Class A common stock will be issued during an IPO with a goal of raising up to $100 million. When looking at revenues, Sweetgreen is showing strong growth compared with its peer companies. The company currently has 140 restaurant locations and a “plant-forward” (sustainable, inexpensive, regenerative, fresh, made from scratch, carbon-efficient, and aspiring to carbon-neutral) menu focused on healthy dining items. The company was founded in 2006, and will trade under the symbol SG as noted above. Pricing terms (such as a reference price per share) for the IPO were not disclosed, but several joint bookrunners (joint underwriters, aka: multi-bookrunner syndicate) of the IPO were disclosed. The company is looking to double its restaurant footprint in the next 3-5 years, has 2/3rds of its revenues coming from online sales at this time, and is aspiring to become profitable.

Keywords – Sweetgreen Inc., Sweetgreen, SG, fast-casual, restaurant, chain, going public, initial public offering, IPO, New York Stock Exchange, NYSE, Form S-1, U.S. Securities and Exchange Commission, SEC, Class A, common stock, revenues, profits, growth, double, expansion, footprint, online sales, pricing terms, reference price, joint bookrunners, joint underwriters, multi-bookrunner syndicate.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in SG, since its shares are privately held at this time.

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 © 2021 – Ambastha Financial LLC.

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By Kuldip K. Ambastha

On Monday, October 18, 2021, real estate e-commerce websites were in the public eye through Zillow Group, Inc. (ZG) falling (-9.4%) and Opendoor Technologies Inc. (OPEN) rising (+3.1%) for the trading day. This bifurcated path occurred because of starkly different perspectives voiced by the leadership teams of the two companies. Specifically, Zillow announced a pause in new home purchases for the rest of 2021 as it tries to work through a backlog of constructions, renovations, and closings related to its existing holdings in an economic environment where labor and supply constraints are present. In contrast, Opendoor has stated it is maintaining new home purchases. Wall Street bid down Zillow and bid up Opendoor due to these announcements.

Keywords – Zillow Group, Inc., Zillow Group, Zillow, ZG, Opendoor Technologies Inc., Opendoor Technologies, Opendoor, OPEN, real estate, e-commerce, technology, tech, buy, sell, home, homes, leadership, bid down, bid up.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in ZG or OPEN.

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 © 2021 – Ambastha Financial LLC.

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By Kuldip K. Ambastha

On Monday, October 11, 2021, the stock of SoFi Technologies, Inc. (SOFI), an American online personal finance company, rose by +13.4% for the trading day. The company has a strong set of offerings across student loan refinancing, credit cards, investing, banking, and other units. The SoFi online platform is accessible both via mobile apps plus desktop interfaces. Because of positive Wall Street equity research analyst information being announced, the stock rose as it did on the first day of the trading week. SoFi’s user base could double in the next two years. Furthermore, the end of the American federal government’s student loan referral program may help SoFi aggressively grow its student loan unit. SoFi will have a bright future ahead of it, as long as the company can deliver on what is being expected of it.

Keywords – SoFi Technologies, Inc., SoFi Technologies, SoFi, SOFI, World Wide Web, WWW, Internet, online, personal, finance, technology, tech, fintech, student loan, credit card, investing, banking, mobile, desktop, Wall Street, equity research, past, present, future, user base, expectations.

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

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 © 2021 – Ambastha Financial LLC.

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By Kuldip K. Ambastha

On Wednesday, October 6, 2021, the stock of Affirm Holdings, Inc. (AFRM), a digital and mobile commerce platform financial technology (fintech) company in the “buy now, pay later” payments arena, rose by +20.0% for the trading day. The catalyst here was a partnership announced between Affirm Holdings and Target Corporation (TGT), a leading American retailer. Ahead of the American winter holiday shopping season, Target has decided that customer-friendly payment option plans of an easy and affordable nature are needed. American family household budgets will potentially be less strained with big holiday spending amounts in the short-term with this Affirm / Target partnership. By allowing customers to make purchases during the holiday shopping season and then pay them off in installments, this partnership is in-line with other fintech / retail partnerships being announced. It remains to be seen if these various partnerships will last beyond the upcoming holiday shopping season.

Keywords – Affirm Holdings, Inc., Affirm Holdings, Affirm, AFRM, financial technology, fintech, Target Corporation, Target Corp., Target, TGT, retail, buy now, pay later, payment, American, winter, holiday, shopping, spending, family household budget, partnership.

Disclosure – The principals and clients of Ambastha Financial LLC have no positions in AFRM or TGT.

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 © 2021 – Ambastha Financial LLC.

By Kuldip K. Ambastha

The stock of Dollar Tree, Inc. (DLTR), a prominent discount variety store chain operator in North America, had an impressive gain of +16.5% for the trading day of Wednesday, September 29, 2021. As dollar store chains have faced rising inflationary, raw material cost, freight shipping cost, and labor cost pressures, store offerings have increasingly been priced at more than $1 at many Dollar Tree competitors. Dollar Tree had been one of the most prominent dollar store chains to adhere to the $1 price point consistently over many years, but that has now changed. $1.25, $1.50, and other higher price point items will be offered in some Dollar Tree stores soon. Investors were intrigued by this news, hoping that the lifting of a $1 pricing restraint will yield much stronger sales growth for Dollar Tree going forward. If its customers stay loyal to and continue to see value in Dollar Tree offerings, sales figures will be much more impressive going forward and Dollar Tree’s tough, bold decision here will pay off over the long-term.

Keywords – Dollar Tree, Inc., Dollar Tree, DLTR, dollar store, $1, $1.00, $1.25, $1.50, North America, pricing, costs, benefits, revenues, sales.

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

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 © 2021 – Ambastha Financial LLC.

By Kuldip K. Ambastha

Toast, Inc. (TOST) had its initial public offering (IPO) of Class A common stock on Wednesday, September 22, 2021 through the New York Stock Exchange (NYSE). Toast, Inc. is a cloud-based restaurant software company headquartered in Boston, MA. The company has an all-in-one point-of-sale and restaurant management platform used by food service and hospitality businesses. The stock’s reference price range was initially $30 to $33 per share, and then increased to $34 to $36 per share. In the end, the stock’s last reference price before trading was $40 per share. On Wednesday, September 22, 2021, the stock opened at $65.26 per share and closed at $62.51 per share. On Friday, September 24, 2021, the stock closed at $55.78 per share.

Given that all of these per share values from past trading days are above the last reference price, Toast, Inc. had a strong IPO since investors have bid up the stock aggressively. The IPO of Toast, Inc. is the biggest IPO ever seen coming out of Boston. The three co-founders of Toast, Inc. (Steve Fredette, Jonathan Grimm, and Aman Narang) are now all billionaires on paper. 29,000 customers and 48,000 restaurant locations now use the offerings of Toast, Inc., driven in part by the coronavirus pandemic which has increased the customer-driven need for takeout options and contactless ordering. Despite what skeptics have said recently, the IPO market looks alive and well when looking at Toast, Inc.

Keywords – Toast, Inc., Toast, TOST, Boston, Massachusetts, MA, initial public offering, IPO, New York Stock Exchange, NYSE, technology, tech, software, cloud, restaurant, food, service, hospitality.

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

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 © 2021 – Ambastha Financial LLC.