Thursday, May 4, 2023

Bank Plummets 40%

Trade of the Day Wake-Up Watchlist

Good morning Wake-up Watchlisters! While you're sipping coffee you'll see stock futures dipped on Thursday. European stocks, including the FTSE 100, opened lower as investors processed the impact of the US Federal Reserve's latest rate hike. The Fed raised the federal funds rate to a target range of 5% to 5.25% yesterday, marking the highest level since September 2007 and the 10th increase in borrowing costs since March 2022.

Many stocks have been down big over the last year. But the truth is the best buying opportunities happen in down markets. Right now – value stocks that stand the test of market headwinds offer the best chance at strong gains. Our Head Fundamental Tactician Karim Rahemtulla is showing readers a $1 stock he's calling the "last great value stock" and for good reason. It's a company you know and admire, and it recently developed an incredible nuclear technology.

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Here's a look at the top-moving stocks this morning.

Qualcomm (Nasdaq: QCOM)

Shares of Qualcomm (QCOM) fell by 7.05% in premarket trading after the company's fiscal fourth-quarter revenue guidance of $8.1 billion to $8.9 billion fell short of Wall Street's consensus estimate of $9.25 billion. The company cited macroeconomic headwinds, weaker global handset units, and channel inventory drawdown as ongoing challenges in its earnings release. This news comes amidst close analyst scrutiny of the chip space, with companies like AMD also facing pressure after its quarterly results announcement on Tuesday, as they work through inventory.

We saw this volatility ahead of time in The War Room yesterday. And with less than an hour before the Fed announcement, we made an overnight put trade on Qualcomm.

If you want to know more about how overnight trading could make you money while you sleep, click here.

 

PacWest Bancorp (Nasdaq: PACW)

PacWest Bancorp (PACW) shares plummeted 40.81% in premarket trading following the announcement that it is exploring strategic alternatives, including a possible sale, only weeks after sharing improved deposit base figures with investors. The bank confirmed on Wednesday that it is in talks with potential partners, having also considered raising fresh capital to boost its balance sheet or breaking up its Pacific Western Bank franchise from its other consumer and commercial lending businesses.

The recent bank failures have created some volatility in the market, which is why our friend Marc Lichtenfeld is showing readers a unique investment outside the stock market. The average return on these rare class of investments was 196% last year, and Marc believes this unusual class of investments has the same profit potential this year.

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Lemonade (NYSE: LMND)

Lemonade is up 11.90% in premarket. A multi-line insurance company, Lemonade posted a loss of $0.95 per share, beating the Zacks Consensus Estimate of a loss of $1.14. Revenues for the quarter ended March 2023 were $95.2 million, surpassing the Zacks Consensus Estimate by 7.72% and year-ago revenues of $44.3 million. The company has topped consensus revenue estimates four times over the last four quarters. Although Lemonade shares have lost about 20.3% since the beginning of the year, the sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.

 

Zillow (Nasdaq: Z)

Zillow (Z) is up 4.74% premarket after announcing Q1 earnings of 35 cents per share, beating estimates of 4.3 cents, and posted revenue of $469 million, surpassing expectations of $425.8 million. The company's revenue for the current quarter is in line with street estimates, with a forecast of $451 million to $479 million versus expectations of $457.4 million. Zillow shares have risen 26% year-to-date. Zillow has also recently announced plans to integrate OpenAI's ChatGPT into one of its offerings for select users.

With new A.I. tools like ChatGPT becoming more engrained throughout the world, it's crucial to consider investing in breakthrough technologies. Right now our friend Andy Snyder is telling readers about a tech stock that's predicted to be worth up to $13 trillion by 2030.

Click here to learn more about XRI.

 

Those are the biggest stock movers for today.

Happy trading!

The Wake-Up Watchlist Research Team

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