Friday 4 Play: The “Can You Take Me Hyzon?” Version
Hyzon, Hyzoff.
Hyzon, Hyzoff.
Hydrogen energy takes one step ahead.
Hydrogen energy takes one step again.
Hyzon, Hyzoff.
Thanks, Mr. Miyagi, however are we going to say the Rattling Yankees up there within the headline?
How about we don’t and say we did?
Now, on a regular Friday, I’d be asking: “Are ya prepared, youngsters?” After which we’d all sing a halfhearted rendition of the SpongeBob SquarePants theme, dive into the inbox and see what emails stick, like Scrooge McDuck.
However that is no regular Friday. No, sir! And seeing as what number of of your emails had been about Hyzon (Nasdaq: HYZN) … we would as properly get into the true meat of the matter.
By now, all y’all Nice Stuff Picks buyers holding HYZN ought to have observed that the inventory is down about 38% at the moment. There’s no straightforward option to say it … oof. That smarts.
So what occurred that precipitated HYZN shares to fall off a cliff? And is it severe sufficient that it warrants promoting the inventory? We’ll reply each questions in a sec, however to get the hydrogen-powered elephant out of the room … nope. We ain’t promoting.
Hyzon introduced two essential items of information: First up, a three way partnership in Europe fell by, forcing Hyzon to restructure its plans to develop all through the area.
You would possibly do not forget that Hyzon had teamed up with Holthausen to transform heavy-duty vans over to gas cells.
In accordance with Hyzon’s submitting, the corporate discovered “operational inefficiencies” within the three way partnership, which implies Hyzon must dump Holthausen and make a special plan to get its fuel-cell enterprise correctly rising throughout Europe.
However Hyzon’s different piece of reports comes out of China — and that is probably what spooked HYZN buyers essentially the most.
Mainly, income accounting wasn’t correctly dealt with in China. This implies Hyzon should delay its monetary outcomes whereas accountants/auditors undergo and see precisely what data is inaccurate.
Since everyone knows that each U.S.-listed firm is remitted to offer an earnings report … all people’s minds immediately went to delisting. Ask any Alibaba investor — delisting fears are a surefire option to ship a inventory tumbling in a single day.
Now, this delay gained’t trigger Hyzon inventory to delist as a result of non-compliance … however there’s a risk. And that risk is how lengthy it takes to seek out out what went incorrect in China.
Y’all understand how a lot Wall Avenue hates uncertainty — whether or not it’s issues over monetary reporting, concern over China or concern over monetary issues in China.
The largest impression for us is that the corporate was on the verge of being worthwhile — thiiiiis shut — and that’s in all probability out the door now.
So … why aren’t we promoting this factor?
For just a few good causes: Not like many strapped-for-cash power corporations, Hyzon nonetheless has greater than sufficient money readily available to finance operations in the interim.
I’m not too apprehensive in regards to the European three way partnership. Bear in mind, hydrogen energy is taking off in Europe a lot a lot greater than it’s stateside. Somebody will choose up the place Holthausen failed.
Whereas I’m keeping track of the potential fallout in China, the issues are just for fiscal yr 2021. The errors had been acknowledged internally … not externally by some short-selling hedge fund intent on destroying HYZN inventory for its acquire.
That is the primary potential blow to the corporate’s administration, however they appear to be on high of it, which is greater than you’ll be able to say for a lot of EV startup corporations which have come below hearth…
That’s a great signal to me … regardless of the quick outcomes not going properly for buyers.
Bear in mind, you’re free to promote any inventory within the Nice Stuff Picks portfolio at any time. In case you’re shedding sleep, do what you might want to do. It’s your cash (or “funding capital” if you wish to be all Richie Wealthy fancy), and I gained’t inform you what to do with it.
However all that mentioned? Nice Stuff will proceed hodling Hyzon within the portfolio.
Feedback? Questions? Considerations? Want validation from some random dude on the web? We’ve obtained an inbox for all the above. Write to us at [email protected] at any time when the market muse compels you.
After all, in the event you’re not prepared to go away the EV market behind fully, we’ve obtained you lined.
One startup’s new know-how is poised to disrupt the $2 trillion automotive trade. Its mild, cheap, highly effective and quick-charging battery could possibly be the tipping level that lastly makes EVs inexpensive for on a regular basis Individuals.
Actually, a Wall Avenue legend predicts it’ll trigger a 1,500% surge in EV gross sales over the following 4 years.
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And now for one thing fully totally different, right here’s your Friday 4 Play:
No. 1: Roam The place You Need To
Roomba ‘around the world…
Wow, your psychological radio dial is actually caught on 1990 at the moment, huh.
Like a wayward, rampant Roomba gone wild — sorry for the visible — iRobot (Nasdaq: IRBT) inventory shot up 19% in a single day. That’s proper: The Roomba robo-vac maker and one-time Nice Stuff Choose simply obtained Amazoned.
So Amazon’s (Nasdaq: AMZN) shopping for up a full-fledged client robotic firm. What may presumably go incorrect? C’mon, everyone knows Amazon would exchange extra human warehouse employees with robots if it may. They’d have to be much more correct than a Roomba although…
Anyway, Amazon is shopping for iRobot at $61 a share, valuing iRobot at about $1.7 billion.
Now what was that we had been simply saying about a rise in buyout motion now that tech shares have been crushed to a pulp? Yeah, right here we go. Earlier than the acquisition, IRBT inventory was 65% off of its 2021 highs, which should’ve been an ideal massive “cut price purchase” signal for Amazon.
This isn’t the ‘Zon’s first enterprise into the patron robotics market. We talked about (learn: poked enjoyable at) Amazon’s Astro, which was a cute lil’ Alexa-enabled house robotic that introduced with it a number of privateness issues.
I do know, I do know, foolish me, pondering any sense of privateness nonetheless exists … however you would at the very least not stick one other robotic eavesdropper in your home, for a begin! I digress…
It’s solely a matter of time (or Prime Days) earlier than we see what Amazon does with its inherited robotic tech from iRobot, and I, for one, don’t welcome our new Amazon overlords.
No. 2: EXPEDIAAAA
In case you didn’t hear a rousing refrain of “dot cooooooom!” in your head simply then, I’m not gonna be mad … simply disillusioned.
Thanks, dad, can we get on with the present now?
Ahem, sure. As you would possibly wager, Expedia (Nasdaq: EXPE) earnings simply echoed what Airbnb (Nasdaq: ABNB) reported earlier this week: That is the journey season of all journey seasons.
It’s no shock, both: After two years of isolation and being cooped up with the fam, it’s time for everybody to stretch their legs a bit. For Expedia, meaning extra customers on its journey websites, together with the OG Expedia, Motels.com, Vrbo (which is like Airbnb however 20% cooler), Travelocity, Hotwire and Orbitz.
Actually, Expedia mentioned that income is up 51% from a yr in the past, coming in at $3.2 billion and handily beating estimates for $2.99 billion. That places final quarter an entire 1% forward of 2019’s second quarter.
Expedia may not be recovering/rising its gross sales as fast as Airbnb … however the firm posted glowing outcomes and additional proved that journey is now lastly above pre-pandemic ranges. For this valiant effort, Expedia was rewarded with … erm … a meager 4% rally that was erased at the moment.
Hey, it’s the thought that counts, proper? No? Alrighty then.
No. 3: You Block Head, You Blew It!
Ever since Block (NYSE: SQ) pulled a Prince and have become “the corporate previously often known as Sq.” … Block’s been attempting to do something and all the pieces to impress buyers and bust out of that L 7 sq..
Mixing Prince and Rick James? Gutsy, however I’m about it.
Downside is, between the corporate’s foray into crypto buying and selling, its Bitcoin hodling à la MicroStrategy and its money-transferring Money App … all of the ugliness got here out in Block’s report. And there’s no renaming your approach outta this one.
Per-share earnings got here in at $0.18 and barely beat estimates for $0.16. Income, then again, is a extra difficult story. The Money App that Block at all times overvalued? Yeah … income there fell 34%.
Then, in the event you take bitcoin out of the equation, complete income really grew 34% on the quarter, in all probability because of Block’s cost terminal enterprise. However similar to with MicroStrategy (Nasdaq: MSTR) earlier than it … we are able to’t merely take bitcoin out of the equation, now, can we?
Block reported a $36 million impairment cost on its bitcoin holdings. Although bear in mind: This solely represents the bottom level of Block’s holdings in the course of the quarter — not what it ended the quarter with.
It’s not a loss ‘til you promote, haha… Please, any individual revive SQ inventory.
Sorry, however after a report like that, SQ dropped one other 5%, although the shares managed to rally again to breakeven by the tip of the day.
What I wish to know is why anybody — Block, MicroStrategy, even your pal Jim down the road — would purchase and maintain bitcoin nowadays. I imply … we simply talked to Mike Carr about a greater option to play crypto’s crazes and crashes.
Click on right here to catch up!
No. 4: DKNG … DONKEY KONG IS HERE
Wait, are you able to really purchase Donkey Kong inventory? You’re solely telling me this now?!
No, I want, however we’re speaking in regards to the different DK at the moment — DraftKings (Nasdaq: DKNG), the sports activities betting platform simply reported bang-up earnings.
Granted, “bang-up earnings” may be a very optimistic option to say that the corporate continues to be shedding cash … but it surely’s not shedding as a lot cash as analysts anticipated. So DraftKings has that going for it, I assume?
Earnings got here in at a lack of $0.50 per share, topping estimates for a $0.75 loss per share. Income, then again, reached $466 million and beat expectations for $439 million with room to spare.
However let’s be actual right here: It is a sports activities betting firm, and we’re both in or about to be in a recession, drying up discretionary earnings for a lot of customers. Will individuals carry on playing as they pay larger and better costs for, you already know, actually all the pieces?
Nicely yeah, have you ever met a playing addict earlier than? Additionally, how do you suppose they’re elevating money for gasoline?
Touché, voice inside my head. Touché.
CEO Jason Robins has some perception on how the enterprise is weathering the financial storm: “Buyer engagement stays robust, and we proceed to see no perceivable impression from broader macroeconomic pressures.”
Nice sound chew, however simply how robust is “robust?” Right here’s a clue: In its report, DraftKings additionally famous month-to-month distinctive paid customers had been up 30% yr over yr, reaching 1.5 million. Higher nonetheless, the corporate is making 30% extra off of every person in comparison with final yr.
DKNG merchants despatched the inventory hovering 16% at the moment, and that’s on high of its 20% pre-earnings rally over the previous week.
Are any of y’all holding DraftKings inventory? Is anyone folding? Let me know your individual finest bets within the inbox: [email protected] is the place you’ll be able to attain us finest.
Within the meantime, right here’s the place you’ll find our different junk — erm, I imply the place you’ll be able to try some extra Greatness:
Regards,
Joseph Hargett
Editor, Nice Stuff
