APRIL 26, 2020

STOCKS – AMZN, GOOGL, FB, MSFT, AAPL, TSLA, QCOM

MACRO – SPY

MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN AAPL, TSLA, MSFT, GOOGL

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It will be a potentially significant week for stocks with an FOMC meeting on Wednesday, along with first quarter GDP, and the ISM manufacturing report on Friday. Then through earnings from Alphabet, Microsoft, Apple, Facebook, and Amazon, in, and it could lead to a significant shift for stock prices. 

MIKE’S READING THE MARKETS PREMIUM CONTENT – 

• Massive Shift On The Horizon
• Earnings Are Deteriorating, Market Is Not Cheap
• Evolution Of Earnings
• Earnings And Techincals All Trending Lower

S&P 500 (SPY)

Taking another look at the S&P 500 has led me to this rising wedge pattern that seems to be a little more apparent after this week’s trading action. The S&P 500 was down about 1.3% this past week and has virtually gone nowhere since April 9 at this point, so one hasn’t “missed” much of anything. However, I think that is about to start changing. The RSI is flattening out, and even showing signs of weakening. Meanwhile, a rising wedge pattern is bearish and suggests a pretty sizeable decline may soon be coming for the S&P 500, back to gap a fill around 2470. 

Alphabet (GOOGL)

I think Alphabet is likely to miss earnings estimates this quarter, as it “hedge fund/trading” unit likely underperforms and takes some mark-to-market losses in the first quarter. As a result, the stock sinks to around $1,150, because investors only look at the EPS, and not what goes into the EPS.

Apple (AAPL)

Meanwhile, Apple is likely to give lackluster fiscal third quarter guidance as iPhone and wearable sales are very weak, and service revenue can’t make up for that slowdown. I think Apple drops back to $235.

Amazon (AMZN)

Amazon is likely to post a steady revenue beat but will miss on the bottom line and chooses to spend on the future. Meanwhile, second-quarter guidance will be conservative, and with the stock up around 30% this year, it pulls back to 2,180.

Microsoft (MSFT)

Microsoft will deliver strong cloud and office growth. But its hardware business will take a hit, and that likely disappoints the street with the stock pulling back to around $162. 

Tesla (TSLA)

Elon Musk will reaffirm Tesla’s guidance of comfortably exceeding 500,000 units deliveries in 2020, and the stock will climb to around $850. 

Facebook (FB)

Facebook will likely see weaker revenue and rising cost, and the market won’t like that one bit, and I think the stock is likely to drop to around $166.

Qualcomm (QCOM)

With iPhone sales slipping, Qualcomm will slip and fill the gap at $65, as I noted in this premium story this week.  Premium content – Bearish BettingContinues In Qualcomm

Have a good Sunday and good luck this week!

-Mike

Mott Capital Management, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Past performance is not indicative of future results.