Week of January 29, 2023
What was really behind the 367% move BuzzFeed (Nasdaq: BZFD) made last week? (Hint: it’s probably not what you think but keep reading to find out…)
If you were an owner of BuzzFeed (Nasdaq: BZFD) stock, last week was very good to you…
Last Thursday, January 26th, 2023, the stock soared on news that BuzzFeed was partnering with OpenAI to generate content, as well as news of a separate deal with Facebook parent company, Meta.
But what’s really behind the 367% move that BuzzFeed (Nasdaq: BZFD) made last week?
Hint: Could it be that BuzzFeed (Nasdaq: BZFD) only has 19.87 million shares in its public float according to MarketWatch.com?
That’s right… there were less than 20 million shares of (BZFD) available for the public to buy and sell last week…
And when the (BZFD) news started to spread it was a mad dash for traders and investors who were all trying to get a piece of the action that caused the share price to skyrocket…
You see, BuzzFeed (BZFD) is what some on Wall Street would call a “low float stock”.
Companies with low floats frequently have a large portion of their equity held by controlling investors such as directors and employees, which leaves only a tiny percentage of the stock available for public trading.
Lucky for you, we just identified a low float Biotech stock that could have significant upside potential and we’re finishing up the full report as we speak.
…But more on that Low-Float Biotech Stock in a minute
Let’s check-in on the rest of Wall Street
Wall Street advanced on Friday January 27th, 2023, marking the end of a rocky week in which economic data and corporate earnings guidance hinted at softening demand but also economic resiliency ahead of this week’s Federal Reserve monetary policy meeting. (Coming on 2 PM on Wednesday February 1st)
All three major U.S. stock indexes ended the session green, with the Nasdaq, powered by mega-cap momentum stocks, enjoying the biggest gain.
The S&P 500 posted a 6-week high, the Dow Jones Industrials posted a 1-1/2 week high, and the Nasdaq 100 soared to a 4-1/2 month high.
Stocks found support Friday after U.S. economic reports showed an easing of price pressures and inflation expectations, which bolsters the case for the Fed to slow its pace of interest rate hikes. (But we’ll see on Wednesday)
So far in the early weeks of 2023, the Nasdaq has jumped 11%, while the S&P 500 and the Dow have gained 6% and 2.5%, respectively.
Fed Chair Jerome Powell has clearly stated that the central bank’s battle against decades-high inflation is far from over…
However, the financial markets still believe the central bank will hike the Fed funds target rate by another 25 basis points at the conclusion of this week’s policy meeting.
Fourth-quarter earnings season is running on all cylinders, with 143 of the companies in the S&P 500 having reported…
Of those, 67.8% have beaten Street expectations, slightly better than the 66% long-term average, but well below the 76% beat rate over the past four quarters.
Last week we brought your attention to earnings announcements from Microsoft (MSFT) and Tesla (TSLA) and they did not disappoint.
Microsoft (MSFT) ended the week up 3.58% after announcing their earnings on January 24th…
But Tesla (TSLA) was the big winner, climbing 32.98% on the week after their earnings announcement on January 25th…
Shares of Intel Corp (INTC) plunged 6.4% after the chipmaker provided dismal earnings projections.
Chevron Corp (CVX) posted record 2022 profit, but its fourth quarter earnings fell short of expectations, dragging the stock down 4.4%.
Rival payment companies American Express Co (AXP) and Visa Inc (V) reported consensus-beating results, easing worries of waning consumer demand. Their shares jumped 10.5% and 3.0%, respectively.
This coming week, in addition to the Fed meeting and January employment data, a string of high profile earnings reports are on tap, notably from Apple Inc (AAPL), Amazon.com (AMZN), Alphabet Inc (GOOGL) and Meta Platforms (META), among others…
But don’t forget, we will be announcing our new Low-Float Biotech Report this week so you should clear your plate and get ready for that one…
Low-float stocks are stocks that have a relatively small number of shares available for trading on the stock market. This can make them an attractive option for those who are looking for high-reward market opportunities.
Low-float stocks are typically more thinly traded than stocks with a higher float. This means that there are fewer shares available for trading, which can lead to larger price movements. When demand for a low-float stock increases, it can push up the price of the stock more quickly and dramatically than it would for a stock with a higher float.
Because there are fewer shares available for trading, low-float stocks are often considered to be a scarce resource. This can make them an attractive option for investors who are looking to own a piece of a company that they believe is undervalued.
There’s also the potential for a Short Squeeze with low float stocks. Low-float stocks are often shorted by investors who are betting that the stock price will go down. When the stock price starts to rise, these investors are forced to buy back shares to cover their short positions. This buying pressure can cause the stock price to rise even further, leading to a short squeeze.
Since there are fewer shares available for trading, low-float stocks are often overlooked by Wall Street analysts. This can make them an attractive option for investors who are looking for an undervalued stock that has not yet been discovered by the mainstream investment community.
…And don’t forget, we will be announcing our new Low-Float Biotech Report this week so you should clear your plate and get ready for that one.
This Weeks Economic Report Watchlist
Wednesday, February 1, 2023
8:15 AM – US ADP Employment Change
Private businesses in the US created 235K jobs in December of 2022, higher than an upwardly revised 182K in November and well above market forecasts of 150K. Service providers added 213K led by leisure and hospitality (123K), professional and business services (52K) and education and health services (42K). The goods-producing sector increased by 22K, led by construction (41K). On the other hand, job losses were seen for trade, transportation and utilities (-24K), natural resources and mining (-14K), financial activities (-12K) and manufacturing (-5K). In 2022, payroll growth averaged nearly 301K a month.
“The labor market is strong but fragmented, with hiring varying sharply by industry and establishment size. Business segments that hired aggressively in the first half of 2022 have slowed hiring and in some cases cut jobs in the last month of the year”, Nela Richardson, ADP chief economist said. Meanwhile, annual pay was up 7.3% year-over-year in December, below 7.6% in November.
ADP Employment Change in the United States is expected to be 170K by the end of this quarter, according to several global macro models and analysts expectations.
In the long-term, the United States ADP Employment Change is projected to trend around 190K in 2024, again, according to several econometric models.
10:00 AM – ISM Manufacturing PMI
The ISM Manufacturing PMI for the US fell to 48.4 in December of 2022, slightly below forecasts of 48.5, pointing to the 2nd month of contraction in factory activity as Americans are shifting spending away from goods to services.
Excluding the decline in April 2020 at the height of the global pandemic, this was the lowest reading since February 2016.
New orders (45.2 vs 47.2), and new export orders (46.2 vs 48.4) declined further and production shifted to the negative territory (48.5 vs 51.5).
On the other hand, employment rebounded (51.4 vs 48.4), with many companies managing headcounts through a combination of hiring freezes, employee attrition and layoffs.
Also, inventories grew faster (51.8 vs 50.9) and price pressures eased (39.4, the lowest since April 2020).
The month-over-month performance of supplier deliveries (45.1 vs 47.2) was the best since March 2009. Only two manufacturing industries reported growth in December: Primary Metals; and Petroleum & Coal Products.
Business Confidence in the United States is expected to be 49.00 points by the end of this quarter, according to several global macro models and analysts expectations. In the long-term, the United States ISM Purchasing Managers Index (PMI) is projected to trend around 53.00 points in 2024 and 52.40 points in 2025, again, according to several econometric models.
2:00 PM – Fed Interest Rate Decision
“Price stability is the bedrock of a healthy economy and provides the public with immeasurable benefits over time. But restoring price stability when inflation is high can require measures that are not popular in the short term as we raise interest rates to slow the economy,” the chairman said in prepared remarks for the panel discussion in Stockholm.
Powell’s comments focused on central banks’ independence and were short of details on the coming interest-rate decisions.
The Federal Reserve raised the fed funds rate by 50bps to 4.25%-4.5% during its last monetary policy meeting of 2022, pushing borrowing costs to the highest level since 2007, and in line with market expectations.
Fed Officials also have signaled their intention to lift the rate above 5% in 2023 and keep it there throughout the year.
Interest Rate in the United States is expected to be 5.00 percent by the end of this quarter, according to several global macro models and analysts expectations.
In the long-term, the United States Fed Funds Rate is projected to trend around 4.25 percent in 2024 and 3.25 percent in 2025, again, according to several econometric models.
Thursday, February 2, 2023
8:30 AM US Initial Jobless Claims
The number of Americans filing new claims for unemployment benefits fell by 6,000 from the previous week’s downwardly revised value to 186,000 on the week ending January 21st, the lowest since April, and well below expectations of 205,000.
The result further consolidated evidence of a tight labor market despite elevated tech layoffs and the Federal Reserve’s aggressive tightening path last year.
The 4-week moving average, which removes week-to-week volatility, fell by 9,250 to 197,500, the lowest since early May.
On a non-seasonally adjusted basis, initial claims fell by 63,849 to 224,481, with significant decreases in California (15,033) and New York (4,975).
Initial Jobless Claims in the United States is expected to be 310K by the end of this quarter, according to several global macro models and analysts expectations.
Friday, February 3, 2023
8:30 AM US Non-Farm Payrolls
The US economy added 223K jobs in December of 2022, the least since December of 2020, after a downwardly revised 256K rise in November, and beating market expectations of 200K.
Notable job gains occurred in leisure and hospitality (67K), health care (55K), construction (28K), and social assistance (20K) while employment changed little in manufacturing (8K), retail trade (9K) and government (3K).
Payroll employment rose by 4.5 million in 2022, an average monthly gain of 375K, compared to 562K per month in 2021 and 168K in 2019.
The report continued to show that hiring is slowing although it remains strong, as the labor market is normalizing after the pandemic shock.
For 2023, the labor market is set to remain tight but job growth will slow further and the unemployment rate is set to rise to 4.6%, according to Fed forecasts.
Many big tech firms have already announced massive layoffs amid rising interest rates, weak consumer demand, and a global economic slowdown.
Non Farm Payrolls in the United States is expected to be 125K by the end of this quarter, according to several global macro models and analysts expectations.
In the long-term, the United States Non Farm Payrolls is projected to trend around 180K in 2024 and 170K in 2025, again, according to several econometric models.
Reminder: We will be announcing our new Low-Float Biotech Report this week so you should clear your plate and get ready for that one…
Who Made New 52-Week Highs This Week?
Here are some notable new highs as of Friday, January 27, 2023…
(A new high is recorded when a security’s price reaches its highest level in 52 weeks.)
Taking the cake this week is Cabaletta Bio (CABA) after climbing over 1910% from its 52-week low.
Coming in second place this week is Pliant Therapeutics (PLRX) after moving up over 779% from its 52-week low.
Third place goes to Transmedics Group (TMDX) who climbed over 590% from its 52-week low.
Fourth place goes to Glycomimetics (GLYC) after they climbed over 564% from their 52-week low.
And rounding out the top 5 for our list of new 52-week highs is Professional Diversity Network (IPDN) as they are up over 421% from their 52-week low.
If you’re interested in discovery stocks that have the potential for making 1,910%, 779%, 590%, 564%, and 421% moves like the top 5 stocks above, then you’re in luck…
Because we have been hard at work uncovering what could be the next big stock play for you.
You need to stay tuned and stay engaged because we just identified a little-known Low-Float Biotech stock that could be extremely well positioned for early 2023…
Remember: It’s no secret that identifying little-known low-float Biotech stocks before they go mainstream can be a highly profitable strategy, as it allows investors to get in early on a company’s growth trajectory.
We are still finishing up our research but as soon as this report is done, you’ll be one of the first to see it…
So clear your plate and get ready.
—Stay tuned for our Low Float Biotech Tech Report