The markets didn’t seem to know which way to turn this morning, as mixed economic data initially put the major indexes into the red before swinging back to the positive side.
On the one hand, worldwide economic data looked troubling, with the eurozone’s composite PMI falling to 50.4 and Germany’s manufacturing purchasing managers’ index (PMI) at 41.4 — below the neutral level of 50 and expectations of 44. On the other hand, U.S. manufacturing data looked more promising. Its PMI rose to 51.
Aside from all this international news, what were readers interested in checking out?
Aurora Stock Still Isn’t Cheap
Like it or not, Vince Martin is on the side of investors who believe Aurora Cannabis (NYSE:ACB) stock has further to fall.
He pointed out that the latest earnings wasn’t that bad on its face. Revenue up 52%. Net cannabis revenue up 61%. A loss on earnings, but a narrower one than in the previous quarter. But the report still disillusioned investors. Why?
In Martin’s words, “Aurora Cannabis missed expectations, and not just in terms of Wall Street. It missed its own revenue guidance. That guidance — preliminary results, actually — was given barely a month earlier and more than a month after the quarter ended.”
In a way, ACB stock is not helped by the breadth of its operations. It has its feelers in over two dozen countries. That complicates things for the company. As he wrote:
“It’s a difficult strategy, even if it makes sense in theory. But it’s a tough strategy in which to have confidence when the company can’t guide correctly a full five weeks after the end of a quarter.”
A Rough Ride for Roku Stock
Should you get out of Roku (NASDAQ:ROKU) stock as it continues its abrupt and somewhat stunning decline? Or should you get in after this massive sell-off? (We’re talking a stock that’s off 28% in the past five days.)
The answer, according to Nicolas Chahine, is that getting out depends on your time frame and getting in depends on how steely your fortitude is — as he puts it, ” this is not a stock for the faint of heart.”
It’s not like Roku is a bad company. Consider how it keeps the subscriber count growing. But it does seem to have gotten out ahead of its skis a bit, considering the exponential stock price growth. The fall has been fierce and may not be over yet, so use caution.
The company isn’t going anywhere, but as Chahine said of Roku stock, “This falling knife is scary as it could turn out to be a machete that is missing its handle. Meaning, it could cost those who try to catch it digits. It is best to let Roku stock hit the ground before reaching for it.”
Take a Tour of the Marijuana Stocks
Josh Enomoto has updated his list of 30 of the best marijuana stocks. With that sector so new, there are a huge number of little companies hoping to make it big and a much smaller number of companies that have already achieved some size and scale.
The usual suspects are there. Aurora. Cronos Group (NASDAQ:CRON). Canopy Growth (NYSE:CGC). Aphria (NYSE:APHA). But he doesn’t stop there. He digs into the biotech side of things with GW Pharmaceuticals (NASDAQ:GWPH) and the real estate investment trust aspect with Innovative Industrial Properties (NYSE:IIPR).
Basically, this article sets out a broad swath of interesting marijuana stocks that interested investors should at least know. As Enomoto puts it, “despite the myriad headwinds, I believe marijuana stocks offer a compelling opportunity. One of the biggest reasons is that we honestly don’t know where this sector can go: While it could fall flat on its face, it very well could spark a paradigm shift.”
TikTok, Buy BABA Stock
Wayne Duggan thinks that Alibaba Group’s (NYSE: BABA) connection with TikTok is going to be a great new revenue stream for BABA stock.
What impact does video sharing app TikTok have? As Duggan wrote, “TikTok may be the latest smash social media hit in the U.S., but it’s not new to China. In fact, TikTok parent company ByteDance is based in China and launched the original version of TikTok in China back in 2016.”
TikTok and Douyin (the original, Chinese version of the app) are looking to monetize their success by putting selling links into these apps. And who’s likely to benefit in a big way from such links, other than those apps? Alibaba and its e-selling peers in China.
That’s it for today’s commentary. Please feel free to drop us a note at editor@investorplace.com to let us know what we got right and what we got wrong. Happy investing!
