In today’s briefing:
- Bear Market Rally Remains in Play; Russell 2000 (IWM) Short-Term Breakout; Buys in Banks & Insurance
- Cloudflare Inc: Launch of CAPTCHA Substitute & Other Developments
- ARLO: Disconnected to Ongoing Growth
- Viavi Solutions Inc.: The Jackson Labs Acquisition & Other Drivers
- Bill.com Holdings Inc.: Business Model
- McCormick & Co.: Major Drivers
- #38 Anatomy of an NFT purchase
- General Mills Inc: Major Drivers
Bear Market Rally Remains in Play; Russell 2000 (IWM) Short-Term Breakout; Buys in Banks & Insurance
- Despite a few tumultuous trading days, the S&P 500 remains above its 200-week MA (3590-3600) and the Russell 2000 (IWM) remains above $163 — both important support levels moving forward.
- We continue to see potential for a bear market rally (~+10% from the lows) as long as these support levels hold.
- Bear market rallies would be confirmed by bullish reversals of the 2-month downtrends, or above 3810 on the SPX and above $174 on the IWM, and the latter happened today.
Cloudflare Inc: Launch of CAPTCHA Substitute & Other Developments
- Despite the heightened economic unpredictability, Cloudflare had a good quarter and managed to deliver an all-around beat.
- The company generated $234 million in sales in Q2, up 54% from the same period last year.
- They now have 1,749 customers that pay them more than $100,000 annually after recently adding 212 additional large customers.
ARLO: Disconnected to Ongoing Growth
- ARLO has the help of a product purchase agreement to smooth out lumpiness in consumer spending in the current macroenvironment
- While ARLO is targeting a higher income consumer with products that are priced higher than competition, there is still a risk that could have played out in September.
- Number of paid subscribers should continue to rise in the third quarter with possibility it could be materially higher than our forecast
Viavi Solutions Inc.: The Jackson Labs Acquisition & Other Drivers
- Viavi had a strong performance in the final quarter of its fiscal year 2022 and the company delivered an all-around beat.
- For fiscal Q4 2022, the SE business’s revenue was constant from year to year.
- Strong NE bookings during the fiscal fourth quarter led to a seasonally stronger Q1 backlog and demand visibility.
Bill.com Holdings Inc.: Business Model
- This is our first report on Bill.com, a leading fintech player that provides digitization solutions for back-office financial operations of SMBs.
- They established new strategic alliances and started expanding their clientele internationally, providing services to clients in more than 150 nations.
- Their organic client base achieved record growth and their customer retention and net dollar-based retention rates also expanded considerably in the last quarter.
McCormick & Co.: Major Drivers
- McCormick had a disappointing quarter with a 3% top-line growth from the same quarter last year, just on par with expectations.
- The management remains focused on managing inventory levels and removing inefficiencies across the supply chain.
- High meat prices had an influence on grilling-related items compared to last year, although grilling is remains popular compared to pre=pandemic levels.
#38 Anatomy of an NFT purchase
- Buying an NFT from OpenSea is probably one of the most convenient ways of approaching blockchain technology for any newcomer.
- And yet it can be intimidating. The process starts as something familiar and easy to understand.
- Still, it soon becomes challenging once you start seeing the different tokens and blockchains once you interact with a wallet.
General Mills Inc: Major Drivers
- General Mills delivered a mixed result for the previous quarter, failing to meet market expectations on the revenue front but delivering an earnings beat.
- The HMM cost savings, along with gains from pricing mix, offset inflation, deleverage, and the other types of operating costs benefitted General Mills’ bottom-line and helped deliver an earnings beat.
- The good news was that General Mills’ service levels increased slightly.
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