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BenzingaEditorial

Mid-caps to the economic rescue

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Stock Market Tumble

Mid-caps are generally defined as companies with whose market cap does not exceed $10 billion. They can be found in any industry and although some are already highly recognizable, many mid-caps are small enough that they still have plenty of growth potential ahead. This is their advantage over some of their large-cap peers. But due to their size and more volatile financials, many have been injured by the ongoing crisis. Yet, many are also poised for a grand fashion return such as SVB Financial Group (NASDAQ:SIVB), Skechers (NYSE:SKX), and Appian (NASDAQ:APPN), SunHydrogen, Inc. (OTC:HYSR) and Contact Gold Corp. (OTC:CGOL).

Silicon Valley Banking

During downturns, bank stocks are not the best ones to have in your portfolio. Dow Jones U.S. Banks Index measured that the sector is down 35% this year. However, Silicon Valley Bank Financial Group is only down 10% due to its niche: startups. The company did not perform poorly during the crisis at all as it added 1,500 new clients. By doing so, it achieved a new record. Obviously, its ratios worsened, but debt remained minimal at $894 million. So even with a mild drop in performance due to COVID-19, it is still among the most efficient bankers.

Retail does not necessarily equal to a disaster

Just like its peers such as the global leader itself, Nike Inc (NYSE:NKE), Sketchers’ sales were hurt pretty badly with a 42% year over year decline. But what prevented a true disaster is the 428% surge in online sales. Moreover, its business in China even grew 11.5% whereas its markets in Europe and the rest of Asia are almost back to pre-pandemic levels.

Software and AI

Big Tech is all around the place these days as their recent results smashed estimates last week. But the low-code software development space deserves the same amount of attention. Appian is a company that enables even those with little or no experience with codes to build and deploy new digital tools. Its subscription-based revenue increased 46% year over year. But due to many companies being forced to pause their new ventures, management expects the second quarter revenue to expand only up to 26%. Although the company has big competitors such as Salesforce.com Inc (NYSE:CRM) and Mendix , which is a subsidiary of Siemens (OTC:SIEGY), with the positive growth trends for AI and software development, Appian has the momentum it needs to fortify its position. It just needs to keep growing.

Solar energy

SunHydrogen Inc, until recently known as Hyper Solar, is developing a breakthrough technology to produce renewable hydrogen. It is currently building a pilot production plant to commercially produce Gen 1 just by using sunlight and any source of water.

This midcap could be an exciting story in the making with the company being at the right place at the right time as the demand for hydrogen and solar technology increases worldwide.

Gold

Turning to this ‘safe haven’ asset during a crisis has been the case during the aftermath of tragical 9/11 events, 2008 meltdown and the current pandemic. Gold prices have reached record highs this year as investors poured their money into the precious metal. Moreover, the price of gold is expected to rise further because of geopolitical tensions. Contact Gold is set to benefit from this trend as earlier in July, the company announced that it is getting back to work at Green Springs, believing it has significant potential for gold discovery. This midcap has a successful and impactful 2019 drill program supporting its way through the current storm.

Takeaway

Midcaps with a strong balance sheet and quality thought leadership are well equipped to weather the undergoing crisis. Disruptive players could also emerge from it even stronger. As the global economy tries to patch itself up in the years ahead, these midcaps could easily emerge as big winners.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure . IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

BenzingaEditorial

Working From Home Trend and Gaming Did The Trick for Microsoft

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On Tuesday, Microsoft (NASDAQ: MSFT) succeeded in beating forecasts far above expectations due to a boom in PC sales, increased demand for gaming and cloud services. The pandemic might have put a lot of constraints to its customers, but it also led to a structural change as businesses across the globe shifted to digital operations and saw it as key to increasing their resilience. Upon the results, Microsoft’s stock was up 5% in after-market trading.

Q2 2021 figures

Revenues increased 17percent as they amounted to $43.1 billion and exceeded $40.2 billion expected by Bloomberg. Earnings per share were $2.03, topping the expected $1.64.

The commercial cloud businesses which Wall Street sees as the main engine of Microsoft’s future growth is reaccelerating. These businesses that include Office 365 and Azure cloud platform, generated revenue of $16.7 billion in the latest quarter, which is 34 per cent up from a year before. At the same time, the launch of a new Xbox Series S and Xbox Series X lifted the gaming business as revenue of Xbox content and services was up a whopping 40% in the quarter. Personal Computing division was also up by 14 per cent as revenues amounted to $15.1 billion.

Meanwhile, the Productivity and Business Processes division reported revenue of $13.4 billion, which is a 13 percent increase. This growth was fueled by strong demand for Office 365 which grew 20 percent when adjusted for currency, which is line with the previous quarter.

Adding more fuel

Microsoft recently announced that it was investing $2 billion to be the preferred cloud provider of the General Motors (NYSE: GM) and Honda-backed (NYSE: HMC) autonomous vehicle firm Cruise. Under the agreement, Microsoft will provide cloud infrastructure for Cruise to better enable autonomous vehicles to navigate highways and surface streets in the future.

A sign of confidence

Microsoft also forecast revenue for the current quarter in the range between$40.35billion and $41.25bn. Themidpoint of the rangewould represent another quarter of 17 per cent growth, beating the 11 per cent that Wall Street forecasted.

Takeaway

Its strength in the cloud and personal computing enabled Microsoft to blow away Q2 expectations. As Mr. Nadella had put it, digital transformation is sweeping every company and every industry across the globe. Microsoft is powering this second wave of transformation that is even stronger than the first one as the world is now creating a new normal that will stay long after the COVID-19 pandemic becomes history.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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BenzingaEditorial

This Week’s IPOs

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This week has eight scheduled IPOs with three billion-dollar deals coming from bio tech, diagnostics, software and solar equipment, among others.

Biotech

The US biotechnology company that received emergency approval from the FDA for its COVID-19 antibody and antigen tests, Ortho Clinical Diagnostics (NASDAQ: OCDX), plans to raise $1.5 billion at a $4.9 billion market cap. This pure-play in vitro diagnostics business provides diagnostic testing solutions. It is profitable on an EBIT basis, with a revenue retention rate of 99% in 2019.

Customer-survey software

Qualtrics International (NASDAQ: XM) seeks to raise as much as $1.46 billion. It provides a customer and employee experience management platform to over 12,000 organizations. But, despite its sticky customers, it operates in a highly competitive environment with low barriers to entry.

Solar equipment supplier

Shoals Technologies Group (NASDAQ: SHLS) designs and manufactures products used in large solar energy projects. It is a profitable and growing company that plans to raise $1.0 billion at a $3.6 billion market cap. However, its growth depends on international growth and its track record abroad is not impressive.

Asset-light container liner shipping company

Israel-based ZIM Integrated Shipping Services (NYSE: ZIM) plans to raise $306 million at a $2.1 billion market cap. This company positions itself as a global leader in niche markets with competitive advantages that allow it to maximize its profitability.

Mortgage

Residential mortgage producer Home Point Capital (NASDAQ: HMPT) plans to raise $250 million at a $3.0 billion market cap. It utilizes a wholesale mortgage origination channel to connect with nearly broker partners, which allows it to serve roughly 300,000 customers.

Asset management

Brazilian asset manager Vinci Partners Investments (NASDAQ: VINP) plans to raise $236 million at a $944 million market cap. Its portfolio includes private equity, public equities, real estate, credit, infrastructure, hedge funds, and investment products.

Supermarket portfolio

Southeastern Grocers (NYSE: SEGR) plans to raise $134 million (100% secondary) at a $725 million market cap. The company itself won’t sell any shares as part of the offering and will not receive any net proceeds from its public debut.

Agriculture

Agricultural technology company Agrify (NASDAQ: AGFY) plans to raise $25 million at a $115 million market cap. This company is highly unprofitable but fast growing. It aims to differentiate itself with a bundled solution of equipment, software, and services that is optimized for growth.

By the looks of it, the 2021 IPO market seems to be continuing 2020’s momentum.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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BenzingaEditorial

This Earnings Week Will Be a Busy One

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Apply (NASDAQ: AAPL), Facebook (NASDAQ: FB), Microsoft (NASDAQ: MSFT) and Tesla (NASDAQ: TSLA) are ready to report record sales this week, along with nearly a quarter of S&P 500 companies scheduled to release their earnings reports. It will also be a busy week, or more precisely a busy Tuesday, for the Dow with 3M (NYSE: MMM), Johnson & Johnson (NYSE: JNJ), American Express (NYSE: AXP) and Verizon (NYSE: VZ) joining Microsoft as fourth-quarter earnings season gets into full swing.

Tuesday

The chip saga continues with Advanced Micro Devices (NASDAQ: AMD) whose shares rose about 5% over the past week and are now up 1.2% year to date. Expectations are high due to its strong fourth quarter results and Intel Corporation’s (NASDAQ: INTC) upside guidance that was issued last week. Wall Street expects earnings of47 cents per share on revenue of $3.02 billion as it assumes the pandemic made a minimal disruption to its business with positive trends in the datacenter business and PC sales. AMD has steadily gained market share from Intel in both of these categories.

Microsoft will also report after the close with Wall Street expecting earnings of $1.64 per share on revenue of $40.18 billion. The trends of working and learning from home continue to intensify demands for Microsoft’s offerings, as evidenced by the strong Q4 demand. But its biggest strength over the past year has been the commercial cloud business and Wall Street remains strongly positive about the company’s outlook for fiscal 2021 due to Azure’s momentum as it’s revenue was up 48% on a YoY basis in the previous quarter. But, this is a slight deceleration from the 50% growth in Q4 and investors will want some evidence that both Azure and Microsoft’s Teams that competes against Zoom (NASDAQ: ZM) can continue fueling its revenues to new heights.

Wednesday

Apple will report after the close and Wall Street expects earnings of$1.40 per share on revenue of $102.76 billion. Holiday quarter is the quarter for Apple and it needs to meet these high expectations as last year’s quarter saw earnings of $1.25 per share on revenue of $88.5 billion. This quarter will be all about sales of the iPhone 12 that has been lauded as revolutionary. The iPhone 12 came with 5G capabilities and features such as its world-facing LIDAR sensor. However, Apple is about more than the iPhone as its services business now accounts for almost 22% of total revenue. Last quarter, its revenue surged to a new record of $14.5 billion.

Facebook will also report after the close with Wall Street expecting earnings of $3.19 per share on revenue of $26.34 billion. Facebook shares had an impressive run over the past week, suggesting that the concerns over digital advertising due to the pandemic have vanished. The social media giant topped consensus earnings expectations in each of the past eleven quarters and has missed earnings estimates just once over the past half of a decade. Yet, over the past year, its shares have been under-performing due to fears of regulatory and political risk. But if it shows a strong surge in daily and monthly active users with an upbeat revenue guidance, its stock should be just fine.

Tesla (NASDAQ: TSLA) will report its first quarter since it became part of the S&P 500 after the close. Wall Street expects earnings of$1.00 per share on revenue of $10.32 billion. Tesla’s shares are up 20% year to date and 99.9% since the company last reported earnings on October 21st, confirming that it is not showing any signs of slowing down. Elon Musk’s focus has been on executing the strategy that brought top and bottom-line improvements, while delivering almost half a million vehicles in 2020. Now, the electric vehicle pioneer has to show it intends to keep pressing the gas pedal.

Takeaway

A number of Republicans don’t support President Joe Biden’s $1.9 trillion new round of fiscal stimulus and have even criticized the price tag. Fortunately, mega tech companies that are reporting this week don’t depend on fiscal stimulus that much, as dar revenue and earnings growth is concerned.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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