This column is my opinion and expresses my views. Those views can change at a moments notice when the market changes. I am not right all the time and I do not expect to be. I disclose all my positions clearly listed on the page, and I do not trade my account on the stocks spoken of in this column unless fully disclosed. If that does not work for you stop reading and close the page. Do not bother me or harass me.
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Michael Kramer and the clients of Mott Capital own Netflix, Disney, Apple, skyworks
Michael Kramer owns IWM Calls.
Another day of going nowhere. The day started with a lot of promise, but by 10 am all that promise fade. The S&P 500 attempted to get over 2,915 and couldn’t manage it. It leaves the index in a frustrating place.
The setup was pretty positive today, with good data out of Germany and strong trading in China should have helped push stocks higher, but it just wasn’t enough. When you look at the pattern you can get a sense it seems like the previous one starting on April 12.
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Russell 2000 (IWM)
The Russell has gone nowhere as well. Ugh! Not what we wanted or thought we would see today.
Netflix (NFLX) Rant
Netflix reported strong subscriber growth of about 9.6 million raisings its entire subscriber base to 148.9 million. Revenue and earnings both topped estimates. The stock is down slightly after hours because the company issued weaker than expected earnings guidance. The company is looking for subscriber growth of about 5 million in the second quarter. The stock really isn’t doing anything follow the results trading around $354.
I think the results are robust and suggest that growth is still very much intact. The second quarter is typically a slow quarter. Remember last year the second quarter was tough and the stock fell sharply after it missed. I guess that Netflix is conservative with its guidance.
Let’s make one thing clear, after listening to TV, the guidance of 5 million new subscribers in the second quarter is not a sign of slowing growth! What are these people talking about! The company just added its biggest number of net additions in its history, and people are talking about slowing growth! What planet do they live on! Even subscriber growth in the US topped expectations. The company guided to net 5 million subscribers in the second quarter, and they had a big miss! What! Expectations for around 5 million.
What this guidance for the second quarter tells me is that 5 million net subscribers are a low bar and something that Netflix now defaults to when it wants to issue conservative guidance. They did the same thing in the third quarter last year.
This talk about competition is stupid, Disney won’t even launch until November. Are you telling me that people are holding off signing up for Netflix because they are waiting for Disney and its $6.99 per month pricing? Gimme a break.
As I have said before Disney and Netflix are two different universes. Just remember who’s been hosting all of Disney’s content on its streaming platform over the last several years! Not Disney, but Netflix. Who do you think knows more about Disney subscribers? Disney or Netflix? Netflix. Netflix has all the data; they have had all the content. Netflix already knows how much the competition may or may not hurt.
Btw I own both stocks. I just can’t stand it when people talk about stuff they have no clue on. Drives me nuts.
Qualcomm finally made the big jump today rising over 22% to $70.25. Now in the Afterhours trading to $75.10. Wow. The stock rose following a settlement with Apple on its lawsuit. We have been tracking the bullish options activity for weeks now. Nice to see it finally work out. This was from April 10. More Bullish Signals For Qualcomm
I’m not sure this news matters to Apple. The stock is likely still on its way to around $209.
Skyworks continues to rise, and is approaching resistance around $93.70 and may be heading higher towards $100.30
Amazon had a day rising above resistance above $1,850 and may be gearing up for a move higher towards $1900.
Citigroup continues to rise and maybe on its way to around $71.
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. Qualcomm, AMazon