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Prepping For Micron and Oracle, Plus Microsoft and Broadcom
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Subscribe →As the week draws to a close the stock market didn’t have a remarkable week, in fact, the S&P 500 was down by about 1 percent for the week. But stocks showed some strong trends on Friday which suggest next week is likely to see gains.
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The S&P 500 continues, for now, to trend higher, putting in a series of higher highs, and higher lows, and as long as that trend continues then the index is likely heading back towards 2,880 over time. The index may rise towards 2,810 next week.
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Micron
One would never know the market was down this week, looking at shares of Micron, the stock jumped by over 11 percent on the week, and is now resuming its uptrend as well, going into earnings next week.
The stock got another significant upgrade today this time from Baird, with the price target rising to $100 from $60, on stronger than expected trends in memory. The actual revenue and earnings estimate trends for the consensus have remained relatively flat, with revenue estimates rising by about 3 to 4 percent for 2018, 2019, and 2020, versus a stock that has climbed by 42 percent. Earnings estimates are trending higher since the start of 2018, up 7 percent for 2018, 5.5 percent for 2019, and 3.5 percent for 2020. But again the stock is up way more.
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That would suggest that investors are expecting the earnings multiple to keep expanding, and it has, rising from below 5 to 6.85. How much more is the market willing to give it? We might find out next week.
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Oracle
Oracle also reports next week, and I found it interesting that somebody opened a position in the April $57.5 calls. The trades weren’t huge, just over 13k contracts. But with the company reporting Monday after the close, it caught my eye.
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Alphabet
Have you notice Alphabet trending lower, it got right to resistance, at $1,175, where the gap was created post-earnings, and it has been trading lower since.
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Microsoft
Microsoft had some exciting news, about a new division within the company that would be cloud-based gaming. The article notes Microsoft is looking for gaming to grow to 2 billion users globally, and a new cloud-based subscription service could help Microsoft reach them. In a Netflix subscriber world, the opportunity could be enormous, with only the hurdle being pricing potentially, but it sounds very cool.
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Broadcom
I was surprised to see Broadcom trade down today, but it looked more like fill the gap-type day while retesting the downward trendline breakout. I still think shares go higher.
That it is it!
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Tags: #sp500 #microsoft #broadcom #micron #oracle #GOOGL
This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
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