NVDA stock forecast for 2021 – the bulls take charge

NVIDIA Corporation (NASDAQ: NVDA) has provided investors a golden opportunity in 2020 for steady growth. The companies share price has gained 132% in value in 2020 alone. The tech giant manufactures Graphic Processing Units (GPU) for Gaming and specialised markets. With such positive growth, analysts have weighed in and the 12 month outlook may surprise you. This article will breakdown what you need to know about NVDA’s stock forecast for 2021.

What are analysts forecasting for NVDA stock?

Firstly, the companies outlook from analysts perspective is overwhelmingly bullish. Across the board of 37 Wallstreet analysts, the average rating from NVDA stock is a buy (29/37 Buy ratings). The average 12 month price target for NVDA stock is $536.32 a share. The higher end price targets from analysts reach as high as $700 a share, suggesting an upside potential of 34%. Furthermore, the lowest target released from analysts last month was at $500 a share (downside of only -3%).

Some of the largest institutions have weighed in on NVDA

Evidently, analyst sentiment has cemented confidence in the longer term performance of NVDA on Wallstreet. Here are some of the more recent targets released by some of the largest financial institutions in the world.

  • 11/19/2020 Barclays – analysts increased the 12 month price target from $525 to $550 a share. The overall rating from Barclays is overweight, suggesting the UK financial institution sees stable growth for NVDA stock.
  • 11/19/2020 Bank of America – analyst Vivek Arya increased the price target from $650 to $665 a share. The target suggest an upside potential of 29%. BoA are clearly confident in the tech giant.
  • 11/19/2020 UBS Group – analysts increased the 12 month price target from $625 to $650 a share. Evidently, both UBS and BoA are very confident the stock will break the $600 price barrier in 2021.
  • 10/6/2020 JP Morgan Chase & Co – with a rating of overweight, analysts increased the 12 month price target to $605 a share.

What are the financial forecasts for NVDA moving into 2021?

Firstly, the strong revenue growth for the company in 2020 has been a key driving force in investor confidence. In the most recent quarter, the company recorded revenue of $4.73 Billion, a 57% improvement year on year. The company actually broke multiple records in quarterly revenue, being gaming revenue, Data centre revenue and overall revenue.

“NVIDIA is firing on all cylinders, achieving record revenues in Gaming, Data Center and overall… The new NVIDIA GeForce RTX GPU provides our largest-ever generational leap and demand is overwhelming. NVIDIA RTX has made ray tracing the new standard in gaming.”

said Jensen Huang, founder and CEO of NVIDIA.

The revenue forecasts for NVDA for 2021-2022

The annual revenue forecasts for 2021 suggest an accrued revenue of $16.49 Billion according Yahoo Finance data. Moving forward the estimated revenue for 2022 is set to rise to $19.85 Billion. This would be a realised 20% growth in revenue for 2022, which is relatively strong for a large blue chip stock. Furthermore, the EPS predictions annualised tend to follow a 50% improvement YOY for 2021 and 2022. The 2022 EPS is estimated around $8 annually, which is a significant improvement from 2020.

What are the ‘smart money’ indicators saying?

The institutional ownership changes can provide investors insight into how larger fund managers perceive NVDA stock. Changes of ownership can be due to many reasons, however certain indicators can set off alarm bells for investors. For example, unusual selling from some of the companies largest institutional holders can be a red flag for investors. The largest holder of NVDA stock is Nuveen Asset Management with a market value of $2.86 Billion. For this quarter, Nuveen increased their holdings by 3.2%.

In summary, this quarter produced a surplus of ownership with institutions buying the stock at a greater volume than selling. This is in comparison to the previous quarter with more institutional investors selling than buying. Historically, the companies greatest influx of smart money was in the Q1 of 2019 with a $20 Billion influx. If you had bought shares after this data was made public in April 2019, your shares would be worth 173% more today.

Summary

I am obliged to remind our viewers that this is not advice but rather investment commentary from extensive research.

In conclusion, NVDA is showing some positive signs moving into 2021 for long term investors. The positive analysts sentiment, aggressive revenue growth and a surplus in institutional ownership has set the company up for a strong 2021. This is not to mention its largely publicised acquisition with ARM which is a classic example of vertical integration. NVDA stock will be one to watch closely as we transition into 2021.

We’ve partnered with Stake. Use our code “YIG” to receive a free stock when funding your new account.

Stake is one of the leading US trading platforms for Australian and UK investors. Click here to start trading US stocks with $0 commission on trades and a streamline trading experience. For more information on our referral program click here.

The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.

Lordstown Motors is surging – here’s the 2021 forecast

Lordstown Motors (NASDAQ:RIDE) ticker officially debuted on Wallstreet yesterday after the completion of its reversed merger with DiamondPeak Holdings (SPAC). The company received $675 million from the SPAC in funding to bolster their manufacturing and distribution of their EV Pickup truck model “Endurance”. Lordstown Motors gained national attention after President Trump had viewed the pick up truck at the White House in September. The company founded by Workhorse (NASDAQ:WKHS) previous CEO Steve Burns has set sail to commercialise the first EV pick up truck available on the market. This article will breakdown the Lordstown forecasts 2021 and beyond.

What are the expectations for RIDE moving into 2021?

After the reverse merger on Monday, investors have rallied behind the EV fleet manufacturer. The company plans to begin manufacturing the Endurance truck in 2021. Lordstown have also received 40,000 pre-orders totalling to an estimated $2 billion in revenue. The first pre-orders are on track to commence delivery in September of 2021. This suggests RIDE will begin to see a dramatic spike in revenue as we enter the latter half of 2021.

“We have evaluated hundreds of companies for more than a year and Lordstown stood out as a differentiated, high growth company at the confluence of electric vehicles and light-duty trucks, two highly valuable areas of focus and tremendous opportunity in the automotive sector.”

David Hamamoto, Chairman and Chief Executive Officer of DiamondPeak

Breaking down the revenue forecasts for Lordstown Motors

These pre-orders are not binding and can be cancelled at anytime until the delivery date in 2021. Although a positive sign of strong demand for long term shareholders, the risk associated is a text book example of risk reward. The company noted the initial 14,000 preorders will be enough to fill their production capacity for the first year. Assuming the company can fulfil half these orders in the financial year 2021-22, the company will be on target to turnover north of a billion in gross revenue.

The Endurance pickup truck will retail for $52,500 and will be assisted by a U.S. tax credit of up to $7,500. Lordstown motors expects operational-earnings margins to break-even in 2022, its first full year of production, and surpass 10% by 2024. Based on these findings its clear why investors are keen on Lordstown’s 2021 revenue forecasts.

“Since its unveiling just over a month ago, the Endurance has been met with enthusiastic support, and to date, we have secured $1.4 billion of pre-orders. Our platform is rooted in sustainability, and the entire Lordstown team is committed to ensuring we contribute to a healthier planet for generations to come.”

Steve Burns, Founder and Chief Executive Officer of Lordstown, read full statement here.

CNBC Interview with Lordstown Motors

Assessing the risk

Merged EV companies such as Hyliion have taken a hit on Wallstreet. This has caused some concern surrounding the suitability of the growing EV industry. There is a growing range of listed EV companies now on the market. Lordstown will need capitalise on their expected timelines for operations to please long term shareholders. Any delay or hitch in the timing will have a serious impact on the stock price.

The time between now and the latter half of this year will likely test the sentiment of long term shareholders. The initial wave of investment in EV companies has begun to slow, with companies such as Workhorse and Hyliion struggling to match their August/September moving averages.

Summary on Lordstown’s Forecast for 2021

In conclusion, Lordstown Motors has exciting prospects moving into the second half of 2021. If the company can stick to their plans without delays there is no doubt the revenue surge will see strong investor backing. The long term opportunity looks promising however there is no reward without risk.

If you enjoy our articles or are wanting to learn more, you can subscribe to us by turning on notifications to get updates when we post a new article. From all of us at YIG, thank you for the support.

We’ve partnered with Stake. Use our code “YIG” to receive a free stock when funding your new account.

Stake is one of the leading US trading platforms for Australian and UK investors. Click here to start trading US stocks with $0 commission on trades and a streamline trading experience. For more information on our referral program click here.

The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.

How to invest in the US stock market from Australia?

The US stock market is host to the best performing market indices across the globe. The US market is made up of two large exchanges, of which buyers and sellers can trade shares in US listed companies. The NASDAQ and NYSE are host to some of the largest corporations in the world, of which own 40% of market capitalisation across the world. This article will discuss why more and more Australian investors are moving to the US market and how you can invest in US stocks from Australia.

Why Invest in US stocks from Australia?

Before we get into how to invest in US stocks from Australia, its important to know why more and more Australian investors are moving to Wallstreet. Compared to the ASX 200, the US market has an vast abundance of companies operating in next generation industries. For example, the US market has a vast eco system of Electric Vechile and Hydrogen powered companies. Companies such as Tesla, Workhorse, Hyliion, Plug Power and NIO have made eye watering returns on Wallstreet. The US market also holds value for value investors looking for Goliath blue chips which have continued to perform over the past 10-15 years.

When compared to the Australian stock market, the difference in opportunity and growth is monumental. The industry diversification in the US stock market is unparalleled. With many niche and evolving industries available on the market, this allows for investors to bolster a strong investment strategy that can cover a vast range of industries. The ASX 200 lacks diversification at this level and therefore investors can find it hard to divise a smart investment strategy that can be hedged.

How to Invest in US stocks from Australia?

For many Australians, accessing the US market was a difficult task. Because of the long paperwork, high costs with commissions, and headache inducing process behind finding a viable broker. However, the eruption of technology, more specifically niche brokers, is allowing Australian investors to easily access the US market at a fraction of the cost. 

It takes four steps for Australians to enter the US market. These include: 

  1. Selecting your broker 
  2. Creating your account 
  3. Funding your account 
  4. Picking your level of competence 

Selecting your broker  

Australian investors have quite a few US brokers to select. Some brokers include Stake, IG, CMC Markets, Saxo, Etoro, and the international accounts with the Big Four except ANZ.  Finding the right US broker based on fees, securities they offer, and investing tools is crucial. From the US brokers above YIG views Stake as an attractive choice for three reasons. YIG does have a commission driven partnership with Stake. First, the platform is incredibly simple and easy to use. Users segway between their investments (dashboard), potential investments (watchlists) and the overall market activity (Wall St). The lack of excessive stimulation allows beginners to get their feet wet in the US market. Second, Stake charges zero commission. Lastly, Stake only offers shares and ETFs. In turn, users are not encouraged to trade with leverage or highly-risky securities. Instead, users can build a strong foundation in the basic US securities, shares and ETFs. 

Creating and funding your account 

Once you are set on a US broker, creating and funding your account is the next step. If you are looking to join Stake, follow this link and use our referral code YIG at registration to receive a free stock. If you want to read our partnership disclosure, then click here

Picking your level of competence 

However, investors must understand that ease of access to the US market does not guarantee financial gain. Investors should remember they are entering a new market. One that has a different economy, greater economic connections to the world, and different market drivers. For example, understanding the impact of presidential comments, Twitter posts, and Robinhood investors on the market is crucial. Knowing the ins and outs of the US market is only half the battle. The US market is enormous. Trading in an industry you feel competent in is a smart strategy. Attempting to trade the entire market could see you burn out and lose money. 

Summary

Overall, Australians have never had more access to the US markets than now. The zero commission policy, simple registration process, and user-friendly interface makes the barriers to enter extremely low. The sheer size of the market, volatility, and investment opportunities make investing in the US market a no brainer. However, investors must understand that trading securities in the US market holds risk and access never guarantees capital gains. 

We’ve partnered with Stake. Use our code “YIG” to receive a free stock when funding your new account.

Stake is one of the leading US trading platforms for Australian and UK investors. Click hereto start trading US stocks with $0 commission on trades and a streamline trading experience. For more information on our referral program click here.

The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.

SHLL closes in on merger date with Hyliion – here’s what you need to know

Tortoise Acquisition Group (NYSE: SHLL) has made a name for itself on Wallstreet this year as they plan to merge with EV truck innovator Hyliion. SHLL has surged 343% over the past quarter, as the merger date moves closer to finalisation. Over the past few days of trading, SHLL stock dipped sharply as the EV sector went into correction. Since the selloff, SHLL rebounded strongly as investor sentiment remains bullish on the up coming merger. SHLL recently announced that there will be a special meeting set for the 28th of September at 9:30 am ET. This special meeting will allow shareholders to vote on the  out come of the up-coming merger with Hyliion. As we move closer to the merger date, lets breakdown the key details of the merger and the future for SHLL-Hyliion investors.

Key merger details

  • Tortoise Acquisition Corp (NYSE:SHLL) and Hyliion will merge as a new company, trading under the ticker symbol (NYSE: HYLN).
  • SHLL is a Special Purpose Acquisition Company (SPAC) that’s sole objective is to merge or acquire another company after raising capital at its IPO. SHLL will no longer be trading under its current ticker once the merger is completed.
  • Hyliion will receive $560 million from this merger. CEO Thomas Healy advised will enable them to push the production of the Hypertruck ERX to full capacity.
  • “Smart money” has poured money into SHLL ahead of the merger with Hyliion, with the likes of Morgan Stanley, Credit Suisse, UBS, Goldman Sachs and Bank of America currently holding SHLL.
  • Hyliion revenue is expected to explode in the next 3-5 years, with a 2023 revenue forecasts at $1.019 Billion and 2024 forecasts to reach upwards of $2 Billion.

What SHLL investors need to know as the merger date closes in

The shareholder vote on Monday 28th of September will formalise the proposal for SHLL to merge with Hyliion under a new ticker (NYSE: HYLN). SHLL has reminded its shareholders to vote on this proposal, no matter how many shares they hold. For more information in regards to voting click here.

SPAC companies follow a unique procedure when merging or acquiring a company. Once SHLL obtains approval from its shareholders, assuming all other criterias are met – the merger will be consummated. From here the two companies will combine into one publicly traded corporation, finalising the merger. For more information on SPAC mergers, we recommend reading this Harvard Law article here.

The future for SHLL & Hyliion investors

This week saw a decline in the EV sector, with SHLL stock falling 28% over a 3 day period. SHLL quickly rebounded back to a new equilibrium at $44.39 by market close on Friday. From today, SHLL stock will likely rise on Monday after the shareholder vote, according to pre-market volumes (opinion not advice).

Interestingly, compared to NIO and NKLA which are both fully electric manufacturers, Hyliion develop hybrid components for Class 8 trucks. The innovative powertrain promises a 0-60 mph in 20 seconds, while hauling up to 80,000 lbs load. The impressive technology offers a more efficient yet cleaner performance for Class 8 trucking companies.

Investors are heavily relying on Hyliion led by CEO Thomas Healy, to roll out the power trains effectively moving into 2021. With such strong revenue forecasts, Hyliion executive managers and board members will have a large job ahead, to please the even larger expectations from Shareholders.

We’ve partnered with Stake. Use our code “YIG” to receive a free stock when funding your account in 24hrs.

Stake is one of the leading US trading platforms for Australian and UK investors. See instructions on how to get started here. For more information on our referral program click here.

The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.

Cassava Sciences surges 148% on final phase 2 results

Cassava Sciences (NASDAQ:SAVA) held a conference this morning announcing promising Phase 2b trial results in treating patients with mild-moderate Alzheimer’s Disease. The company uses the drug Sumifilam to treat AD by reducing neurodegeneration and neuroinflammation. The results announced via conference call concluded that the data shows a promising increase in cognitive bio-markers within AD patients – an impressive feat for the AD treatment pioneer. The results disclosed this morning are quite strong however we will breakdown the results of the dataset and what the imminent future looks like for shareholders.

Table of Contents 
1. Introduction 
2. Results summary 
3. What the future looks like for Cassava investors?

Results summary

  • The phase 2b trial results showed promising data in treating mild to moderate AD patients
  • The results show consistency with the Phase 2a trials, a positive sign the drug holds benefit to AD patients
  • “No other clinical-stage drug candidate has improved an entire panel of biomarkers of disease pathology, neurodegeneration and neuroinflammation, and appears to benefit cognition
  • The next steps outline the development of the Phase 3 efficacy program, after the End of Phase 2 meeting with the FDA
  • “98% of patients treated with Sumifilam 50 mg for 28 days showed improvements in validated biomarkers of AD pathology, neuroinflammation and neurodegeneration with no safety issues.”
  • Cognitive markers were up, however only directional improvement was seen in the improvement of spatial working memory – 17%-46%
  • See all data here.

What the future looks like for Cassava investors?

Before I begin, I am obliged to remind our viewers that this is not advice but rather investment commentary from extensive research

The dataset provided this morning shows positive signs for long term shareholders of Cassava, however the Phase 3 program will be the company’s biggest challenge to date. The data is consistent from Phase 2a to Phase 2b, which does suggest Sumifilam has the potential to improve the cognitive bio-markers in AD patients on a larger scale. Investors have pounced on the positive Phase 2b trials this morning, marking an incredible surge of 148% premarket.

SAVA will likely drawback after open, before finding equilibrium as speculators withdraw with profits. Longer term investors will be less phased by the added volatility, as the key focus is delivering strong Phase 3 trials in 2021. One of the key concerns for current stakeholders is if SAVA can produce stronger correlative data with spatial working memory in AD patients. Cassava advised the directional relationship is limited due to the size of the trial, so Phase 3 should shed some light on the ability of the AD drug in patients.

Want access to free, uncomplicated, and smart COVID-19 Strategies then click below?

https://youth-investment-group.com/2020/04/09/how-to-profit-off-smart-investments-during-covid-19/ 

If you enjoy our article or are wanting to learn more, you can subscribe to us by turning on notifications to get updates when we post a new article. From all of us at YIG, thank you for the support.

The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.

When will SPAQ become Fisker – here’s what you need to know

Spartan Energy Acquisition Corp (NYSE: SPAQ) is rallying up the bulls as we inch closer to the SPAQ Fisker merger. Investors are expecting to ride the bullish undertone in the lead up to the merger. However, below the surface, a SPAQ Fisker investment is exhibiting risks that investors must know. Thus, today’s article will explain when SPAQ will become Fisker, and the associated rewards and risks.

Table of contents 
1. When will SPAQ become Fisker?
2. Potential perils and rewards with a SPAQ investment.

When will SPAQ become Fisker?

SPAQ will become Fisker on the 14th of February, 2021. “The merger values Fisker at a whopping $2.9 billion but we will only see the EV company reap $1 billion.” Nonetheless, Fisker is pumping all the reverse merger funds into developing its all-electric Ocean SUV, which is expected to be ready by the end of 2021. The set back from the 14th of August to the 14th February 2021 initially disappointed investors. However, the 15% over the past five days could indicate a strong bullish future towards the merger (opinion not advice).

Post-merger forecast – will we see another Nikola?

Before I begin, I am obliged to remind our viewers that this is not advice but rather investment commentary from extensive research

Risks

The first potential red flag of a Fisker investment is its similarities with Nikola. Pushing the fact that both went through a SPAC aside, which are receiving extreme overvaluations (opinion not advice), Fisker has yet to manufacture a product. Founder Henrik Fisker, expects its all-electric Ocean SUV to come to fruition at the end of 2021, which translates to hype style media over the coming months. Not to mention the delay in the merger could impact the Ocean SUV timeline. YIG stresses the product point because we all know how no-product hyped up companies can turn out.

Moreover, Henrik Fisker’s history with bankruptcies could pierce the armour of investor confidence. Fisker’s first business venture, Fisker Automotive, ended in turmoil largely due to “production delays …. and problems with a key battery supplier”. A dark track record should make short-term and long-term investors cautious.

Rewards

A SPAQ Fisker investment could still have significant upside potential. First, the reversal since the post-merger announcement is suggesting the bulls are retaking control. (opinion not advice) Especially as SPAQ is up 15% in 5 days. The EV and SPAQ boom should also see Fisker receive a tidal wave of media coverage, which could see retail investors continue to pour into the SPAC. The ability to learn from mistakes could also see Henrik Fisker turn the rising EV business into a spectacle.

SPAQ Fisker forecast

Overall the delay in the merger is a double-edged sword. On the one hand there is more time for the SPAQ Fisker hyper to grow. However, the next few months will incur a significant amount of volatility. From the election to EV overvaluations, to possible market corrections from potential vaccine delays or increased economic destruction. Thus, a SPAQ Fisker investment holds both material risk and reward, which means setting concrete stop losses and profit targets is a must.

 

If you enjoy our article or are wanting to learn more, you can subscribe to us by turning on notifications to get updates when we post a new article. From all of us at YIG, thank you for the support.

Here is our free, uncomplicated, and extensive ASX portfolio

https://youth-investment-group.com/portfolio/

Want access to free, uncomplicated, and smart COVID-19 Strategies then click below?

https://youth-investment-group.com/2020/04/09/how-to-profit-off-smart-investments-during-covid-19/ 

The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.

Written by Patrick McLoughlin, Senior Manager of YIG.

Robinhood traders lose 50% on Nikola Motors – Does YIG see value?

Nikola Motors’ (NASDAQ: NKLA) meteoric rise sucked in an enormous amount of Robinhood investors, professional investors, and criticism. Many investors are in no man’s land as the future direction of Nikola remains uncertain. Some investors are championing the shorting route, while others believe in that Nikola Motors is just suffering a setback. Thus, today’s article will provide our readers with a simple explanation as to why Nikola fell so hard, why it is radically different from other EV makers, and whether YIG sees value.

Table of contents 
1. Why did Nikola fall so fast? 
2. Is NKLA similar or different from its competitors? 
3. Does YIG see any potential in NKLA?

Why Nikola fell 50% in two months

Nikola’s growth story is not clear cut. Some investors believe NKLA rose from $10 to $70, a 700% gain, in months. However, Nikola went public on the 3rd of June through the Special Purpose Acquisition Company (SPAC) Vector IQ. Thus, the rise from $10 to $37.55 was all under Vector IQ. The surge under the NKLA ticker, which was from $37.55 to $79.73, a 136% gain, lasting only five days.

NKLA’s meteoric rise was because of greed and FOMO. Investors who missed out on Tesla’s enormous growth wanted to make sure that when the next opportunity came by, they were ready. Nikola was their get rich ticket, or so it seemed. Extreme overvaluations on Nikola saw many retail investors flood the market. Nikola gained 100% in a few days, and many retail investors believed they finally made a lottery ticket investment. However, the nasty decline ever since June the 9th has left retail investors scratching their heads.

Nikola’s downfall

Explaining Nikola’s downfall is a much harder task, but we will keep it simple. Nikola plummeted for three reasons: big investors dumping their shares, investors lacking confidence in ex Ceo Trevor Milton, and the hype began to dry up.

First, the rapid expansion saw professional traders take their profits as the overvaluation was becoming unsustainable. The initial sell-off then triggered retail investors to sell under the fear of losing more money (loss-aversion). Second, investors began to lose faith that Trevor Martin, ex CEO, could steer the NKLA ship in the right direction. Especially after statements like this one, “90% of investors will probably never invest, we needed to touch the consumer. The pickup truck is for the consumer and the consumer is part of the Robinhood portfolio – which is where the valuation comes from” (Interview Trevor Milton and Jason Calacanis)

Considering the pickup truck is still two years away, investors are suspicious of whether Trevor was purposefully hyping up NKLA to increase his wallet. The lack of confidence saw Trevor step down from CEO. Lastly, NKLA’s vehicles are just ideas, meaning that Nikola has no products for the market. Ultimately, triggering a massive sell-off.

Here is how NKLA is different from its competitors

Nikola focuses on using hydrogen to run their motors as opposed to the all battery power route, which Tesla endorses. However, with a different fuel makeup, you need different charging stations. Nikola looks to build 700 hydrogen stations across the U.S. Because, at the moment, access to Hydrogen refuelling stations is limited. Compare, Nikola’s intention to build 700 stations to Tesla’s already built 1,870 Supercharger stations.

However, Nikola and its competitors’ most notable difference is that NKLA does not have any products for the market. Nikola is still searching for manufacturing partners. Compare that to Tesla’s semi, and Workhorses C650. Overall, NKLA is radically different from its competitors, as production is not guaranteed.

Does YIG see any investment potential in NKLA?

Before I begin I am obliged to remind our viewers that this is not advice but rather investment commentary from extensive research

Short answer: Using the liquidity to play short-term trades holds the most value but still has risk. (opinion not advice) 

Nikola will likely stay in the woodshed with the bears for a while. Potential supply chain disruptions, delays in the production of their hydrogen stations or trucks, and weak earnings will continue to discourage long-term investors from getting in. Because the fundamentals will not be attractive. Thus, investing in Nikola for the long-term may not be the smartest play.

However, investors are still trading Nikola in substantial volume, which is an advantage. Because the liquidity allows investors to get in and out of the trade seamlessly. Thus, short term trades that aim to profit or bullish outbursts hold the most potential. YIG would like to point out that day trading NKLA on quiet days is extremely dangerous.

If you enjoy our article or are wanting to learn more, you can subscribe to us for free via email and get updated when we post a new article. From all of us at YIG, thank you for the support.

The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.

Here is our free, uncomplicated, and extensive ASX portfolio

https://youth-investment-group.com/portfolio/

Want access to free, uncomplicated, and smart COVID-19 Strategies then click below?

https://youth-investment-group.com/2020/04/09/how-to-profit-off-smart-investments-during-covid-19/ 

Written by Patrick McLoughlin, Senior Manager of YIG.

54,000 Robinhood traders bought Rocket Companies on Friday – Does YIG see value ?

Mortgages are more than just a loan from a bank, they represent people’s hopes and dreams. Customers reward the businesses who satisfy the needs of mortgagors the best with truckloads of cash, which brings us to this week’s stock Rocket Companies (NYSE: RKT). Rocket companies is an online mortgage and car loan lender. The business “obsesses with helping their clients achieve the dream of homeownership and financial freedom”. It seems RKT fulfils its mission as they have a 4.9/5 star rating and a 96% recommendation rate. Wallstreet is equally attached to RKT as investors drove a 35% rally in two days after Rocket companies went public on Thursday.

Table of contents 
1. Why is RKT up 
2. Does YIG see value in a Rocket Companies investment?

Rocket Companies surges 35% on IPO

Rocket Companies wears a veteran badge as the giant corporation has been growing at a healthy rate for the past 35 years. Not to mention that RKT is the parent company of one of America’s largest mortgage lenders, Quicken loans. Thus when RKT debuted on the NYSE, arguably one of the biggest IPOs of 2020, investors went berserk. However, is there more to the IPO sensation than just a business name that investors are familiar with.

The early sell-off and fintech revolution were the driving factors for RKT’s IPO success. Rocket Companies said last week it was offering 150 million shares with an expected price range between $20 and $22 but on IPO day RKT only sold 100 million shares at $18. It seems the disappointing IPO price saw opportunists snap up shares while the sentiment was down. Since the minor sell-off, RKT’s share price has only climbed higher. The mortgage market is becoming digitalised, and RKT is shaping up to be the industry captain. Mainly because of their enormous customer base and excellent customer service.

Does YIG see value in a RKT investment?

Before I begin, I am obliged to remind our viewers that this is not advice but rather investment commentary from extensive research in the field. 

Short answer: A long-term investment in RKT, America’s largest mortgage lender could potentially provide a gain. However, timing your entry with technical analysis is crucial (opinion not advice).

All signs point towards a bullish trend for RKT

RKT screams growth potential (opinion not advice). The disruptive mortgage lender should experience positive growth here on out as the digital economy continues to expand. Not to mention that refinancing mortgages, and buying homes should go up as the stay at home economy grows. Moreover, the online mortgage revolution will see customers flock to trustworthy lenders. Considering RKT recently surpassed Wells Fargo as the biggest mortgage lender in America, and holds 9% market share there is a high chance that mortgagors will gravitate towards Rocket Companies. Also, 54,332 Robinhood users bought RKT stock, which means more waves of retail investors should pile onto the mortgage disruptor.

Timing your entry in RKT with Technical Analysis

The fairytale beginning for RKT might encourage some investors to buy at open on Monday. The sentiment is incredibly bullish, and an investment on Monday should pay-off in the medium to long-term. (opinion not advice) However, if you want to potentially increase your profit on RKT, then timing your entry is essential. How do you time your entry? Professional investors use technical analysis to time their entry, whereas retail investors usually enter when the stock is hot.

Technical analysis might sound scary. However, it is simply comparing the current price to previous prices so that you can understand if the stock is overbought, oversold, or just bouncing up and down between a given region. Essentially traders use technical analysis to understand the supply and demand of a particular stock and time their entry accordingly. For RKT, we will keep it simple and use resistance and support levels.

Support

RKT experiences strong support at $23, which was validated four times throughout Friday’s trading. If Rocket Companies falls to the $23 mark, but no below, then more investors will likely buy, and we should see RKT rise. However, YIG would like to point out that if RKT drops below $23, than the support level is broken, which should trigger a selling frenzy.

Resistance

In terms of resistance, buyers stop buying RKT at $25. If investors drive the price above $25, the stock has broken out and should continue to climb higher in theory. However, YIG would like to point out that investing and hoping the stock will break out is dangerous. Because the closer RKT reaches its resistance level of $25 the higher the chance investors will begin to sell.

Overall, traders should look to time their entry when RKT sits above its support level but is about to rally in the near future. For example, if RKT dipped and traded just above its support level of $23 and if the sentiment was still bullish, then that could be a possible entry (opinion not advice). However, resistance and support levels are constantly changing, so what might have been on Friday may longer be the same on Monday.

If you enjoy our article or are wanting to learn more, you can subscribe to us for free via email and get updated when we post a new article. From all of us at YIG, thank you for the support.

The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.

Here is our free, uncomplicated, and extensive ASX portfolio

https://youth-investment-group.com/portfolio/

Want access to free, uncomplicated, and smart COVID-19 Strategies then click below?

https://youth-investment-group.com/2020/04/09/how-to-profit-off-smart-investments-during-covid-19/ 

Written by Patrick McLoughlin, Senior Manager of YIG.

Google signs $450 million home security deal with ADT – here’s everything you need to know

Despite Google’s (NASDAQ: ALPHABET) monstrous size, they are always looking for new markets to tap into and dominate. Yesterday the tech giant grew its market foothold in the home security space after investing $450 million into ADT. ADT supplies secuity for residential and small businesses throughout America. The partnership triggered a buying frenzy on Wallstreet as ADT soared by 75%. The hype is starting to settle, but investors wonder whether we could see volcanic activity in the coming days.

Table of contents 
1. A digestible breakdown of the Google-ADT partnership 
2. Why home security is bullish in the long-term 
3. Everything you need to know before investing in ADT

Breakdown of the partnership

The partnership simply represents Google adding ADT home security systems to expand its nest line of products. Google’s Nest line includes thermostats, smoke detectors, smart doorbells, and many more. The $450 million investment will see Google acquire 6.6% of ADT in Class B shares. Essentially, Google will have no voting rights within ADT but access to their products. Investors interpreted the partnership as the beginning of a new chapter in ADT’s business life as they look to create the next generation of home security products. The bulls instantly rallied behind the catalyst propping up ADT by 75%. At the moment, ADT is still up 58% since Monday’s announcement. Therefore, suggesting an underlying confidence from ADT investors.

 The megatrend of Home security

Security is becoming increasingly important as the world evolves. Especially in times of crisis when crimes rates go up. Ultimately making the home security industry a bullish emerging market. However, consumers will only place their wallets with security brands they trust. While Google is under the spotlight for potentially abusing its power in advertising and data sharing, society still subconsciously trusts the tech giant. Because Google is the most pervasive brand in technology realm. Thus, if Google, alongside ADT, can cement themselves as the home security captains, investors will flock towards each company.

Everything you need to know before investing in ADT

Before I begin, I am obliged to remind our viewers that this is not financial advice but rather investment commentary from extensive research

Unusual sell-off

Most Investors see a stock jump 70% and instantly scream pump and dump. However, ADT defied the odds on Monday as they only fell by 10% after the announcement. ADT currently trades at $13.48 but is at 13.31 in the pre-market (at the time of writing). Considering that ADT’s resistance and support levels are around $15.30 and $13.40, respectively, the current price offers investors a potential window (opinion not advice). Because ADT is near its support level that should ignite a buying party, which should run the stock up to, but necessarily above, its resistance levels. However, YIG would like to point out that if ADT drops pass its support levels then that would trigger  significant selling pressure. Hence setting a stop loss around the support levels would help mitigate the risk in your investment.

Growing market bubble

Tech stocks are soaring to new highs every day, which is the driving force behind the steroid like stockmarket gains. To put the extreme growth into perspective, the NASDAQ is 11% higher than what it was before the coronavirus. The recent Google-ADT partnership should be enough to maintain a strong bullish sentiment for the meantime. However, a bursting of the stockmarket bubble could see ADT fall just as much as it climbed. YIG does not expose the potential bubble to discourage ADT or Google investors but to simply provide a balanced perspective.

If you enjoy our article or are wanting to learn more, you can subscribe to us for free via email and get updated when we post a new article. From all of us at YIG, thank you for the support.

The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.

Here is our free, uncomplicated, and extensive ASX portfolio

https://youth-investment-group.com/portfolio/

Want access to free, uncomplicated, and smart COVID-19 Strategies then click below?

https://youth-investment-group.com/2020/04/09/how-to-profit-off-smart-investments-during-covid-19/ 

Written by Patrick McLoughlin, Senior Manager of YIG.

SHL acquires Varian Medical Systems to create a gigantic US cancer company – here is everything you need to know.

Varian Medical Systems (NYSE: VAR) grabbed the stock market microphone to announce that it will be bought out by the German technology behemoth Siemens Healthineers. Some investors might view the transaction as one company swallowing another. However, the acquisition marks a quantum leap in the cancer fight. Considering cancer treatments are the crown jewels of biotechnology, it is not surprising that the news is spreading fast. Today’s article will provide our readers with a simple overview of the buyout, why it is significant, and everything you need to know before investing.

Table of contents 
1. Overview of the acquisition 
2. Why the new company is significant for the cancer industry 
3. Everything you need to know before investing

 

Siemens Healthineers acquires Varian Medical Systems for $16.4 billion

Siemens Healthineers has agreed to acquire Varian in an all-cash transaction valued at $16.4 billion. Under the agreement, Siemens will purchase all outstanding shares of Varian for $177.50 per share. To put the share price payment into perspective, VAR currently trades at $142.72 (Friday’s close). Thus, Siemens price represents a 24% premium to the VAR’s closing price on Friday. To say that Varian investors are on cloud nine right now would be an understatement. However, it is important to note that at the moment, the acquisition is just an announcement. Siemens Healthineers and VAR expect the acquisition to finish around mid-2021.

Why is this new cancer-fighting giant so special?

Creating an antidote to cancer requires solutions to a range of areas. These include screening (identifying cancer in people who are not showing any signs yet), diagnostic equipment (detecting diseases), post-treatment care, radiotherapy (using forms of radiation to kill cancer cells), and AI capabilities, and many more. Varian brings to the table excellent knowledge in radiotherapy and high-quality cancer patient care. While Siemens adds innovative diagnostic tools and compelling Artificial Intelligence. Combine the strengths of both, and you create a company that can put forward many solutions to the areas mentioned above. CEO of Varian, Dow Wilson, drove home the significance as he said, “the combination with Siemens brings us even closer to realising our transformative vision of a world without fear of cancer.”

Everything you need to know before investing in Varian Medical Systems

Before I begin, I am obliged to remind our viewers that this is not financial advice but rather investment commentary from extensive research.

Short term approach to Varian Medical Systems

Varian Medical Systems does not target a specific cancer. Instead, the biotech focuses on creating the software and developing innovative machines to fight cancer. Thus, Siemens Healthcare, through Varian, has access to most of the cancer market. Allowing investors to ride the future hype on other biotechs using Varian’s machinery and software to treat cancer.

Long term investing

AI is undoubtably part of the future medical world and Varian is at the forefront of the industry shift. However, Varian is combining AI and Adaptive Therapy to create Adaptive Intelligence or Varian Ethos as they call it. Providing them a unique edge in the AI-biotech niche. Thus, investing in Varian Medical Systems from an AI megatrend perspective could be viable (opinion not advice).

The “dark side of the cancer industry”

If you are an investor or not, you probably have heard something along the lines ‘this could be the next cure for cancer’. It might seem like biotechs are re-enacting the boy who cried wolf. Society remains divided on whether the government and Big Pharma are keep the key to the cancer-free world hidden.

Thus, YIG stresses to investors to always do your own research, especially in the cancer field. Because no matter how attractive the company sounds, it is all about the perception. One moment investors might believe the company holds an effective treatment and that the stock could rocket to the moon. Then before you know it, the perception changes to pessimism as the cancer hopes fade. Overall, it is best to invest in times of stability and sell on cancer-related news such as today’s announcement (opinion not advice).

If you enjoy our article or are wanting to learn more, you can subscribe to us for free via email and get updated when we post a new article. From all of us at YIG, thank you for the support.

The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.

Here is our free, uncomplicated, and extensive ASX portfolio

https://youth-investment-group.com/portfolio/

Want access to free, uncomplicated, and smart COVID-19 Strategies then click below?

https://youth-investment-group.com/2020/04/09/how-to-profit-off-smart-investments-during-covid-19/ 

Written by Patrick McLoughlin, Senior Manager of YIG.

 

 

 

 

TNXP set to fill an unmet COVID-19 need – here is everything you need to know.

Tonix Pharmaceuticals (NASDAQ: TNXP) is gaining significant investor backing after releasing a COVID-19 announcement. TNXP stock price instantly surged. It’s no secret, COVID-19 press releases are the wallet magnets of the stock market. However, the share price movement of Tonix is unique. Mainly because TNXP did not gap up by an astronomical amount. Leaving many investors intrigued as to whether they stumbled across a gold mine. Thus, today’s article will deconstruct the COVID-19 announcement, the position of Hedge funds, and provide our viewers with everything they need to know before investing.

 

Table of contents 
1. Why is TNXP trading higher? 
2. Wall Street is bullish on TXNP - is that a good thing? 
3. Everything you need to know before investing in TNXP.

Is TNXP in the COVID-19 race or another loose end?

TNXP announced a research collaboration with Columbia University yesterday. The partnership focuses on studying the immune responses to COVID-19 in healthy volunteers who have recovered from the virus. TNXP and Columbia will look to place more importance on T cell and antibody response that COVID-19 causes. Some investors might be thinking so what, there are countless COVID-19 stocks, what makes this one different?

Firstly, TXNP is aiming to the fulfill an unmet COVID-19 research need. According to Dr. Trakht, “T Cell responses to COVID-19 have only recently been reported.” Thus, the collaboration is designed to fill the topic with some data and provide a basis for COVID-19 vaccines. Also, the data could assist TNXP in selecting patients for their vaccine TNX-1800.

Overall, TNXP’s focus on an unmet COVID-19 need and the possible link to the vaccine market was enough to bring out the bulls. Ultimately, triggering a 11% rise yesterday and a 5% surge in pre-market (at the time of writing).

 

Analysts are bullish on TNXP

Writing candidly, analysts target prices, and ratings hold both little and significant influence over the stock price. On one hand, the target price is usually higher than the current price to indicate a bullish rise. Ultimately, providing retailers investors a guide as to what direction the institutions believe the stock will go. However, YIG would like to point out that analysts are always playing catch up. For example, if the stock keeps rising the analysts keep raising their target prices and vice versa for bearish movement. Thus, investors should not necessarily become attached to the analysts pricing but instead use it as a guide for bearish or bullish direction. Second, Analysts rating becoming influential when a lot of retailers follow suit. The more reputable the analyst the more sheep following. Investors can use this to their advantage to understand how the masses perceive the stock.

In the case of TNXP, Roth Capital has a “buy” rating on the stock with an expected value of $4. Considering, TNXP currently trades at 0.66 cents Roth Capital is extremely bullish.

Everything you need to know before deciding to invest in TNXP

Before I begin, I am obliged to remind our viewers that this is not financial advice but rather investment commentary from extensive research.

Investing in the COVID-19 hype

Investors might hear COVID-19 unmet research need and expected stock price of $4 and think I’m sold. Overall, investing while there is COVID-19 noise behind TNXP holds value, but make sure you check for red flags before jumping in (opinion not advice). Red flags could include an increase in people shorting the stock, institutions, and many buyers investing in the hype. Also, YIG would like to point out that COVID-19 investors have a demanding appetite. If COVID-19 announcements do not follow, the first investors tend to sell due to impatience. Ultimately, triggering a sell-off. Thus, investing in the hype could pay-off but understand the risks first.

Investors should not ignore shorting TNXP

The COVID-19 fantasy stock does not always go to plan. Some investors might think the news will only stay behind TNXP for a week before they get sold off. The COVID-19 inevitable sell-off theory seems to hold. Especially as vaccine frontrunners like Moderna, Novavax, and INO have been torn apart by the bears along their stock rise.

At the moment, the bulls reign supreme, which means put options are cheap. However, YIG would like to point out that options tend to be great if you expect an explosive re-direction. For a TNXP short to reap the highest rewards, you need a lot of buyers to be wrong. Buyers are increasing, but are they wrong is a question you need to answer. If the COVID-19 dies out, TNXP could trade sideways in which your put option would expire worthless. Thus, if you think the stock price will ripple sideways, selling a call could be an excellent strategy to profit off optimistic buyers. However, before shorting TNXP, or any stock, you must understand the risk of options.

Here is our free, uncomplicated, and extensive ASX portfolio

https://youth-investment-group.com/portfolio/

Want access to free, uncomplicated, and smart COVID-19 Strategies then click below?

https://youth-investment-group.com/2020/04/09/how-to-profit-off-smart-investments-during-covid-19/ 

If you aren’t already subscribed to us, you can subscribe for free via email below and get updates when we post new articles and stock market news. From all of us at YIG, thank you for the support.

The information above should not be taken as financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you. 

Written by Patrick McLoughlin, Senior manager of YIG.

SHLL surges 60% off EV merger announcement – could you profit off shorting the speculation?

Tortoise Acquisition Corp (NYSE: SHLL) is acting like a magnet to robinhood investors as the stock surged 60% in a few days. The imminent merger between Hyliion incorporated and SHLL caused the volcanic eruption on wall street. While the merger sounds promising, some investors question the validity of the bullish move. Leaving many investors at the stock market theme park wondering should they jump on the SHLL rollercoaster or sit this one out? Let us tackle this investing dilemma today.

Table of contents 
1. SHLL and Hyliion merger overview. 
2. What is Hyliion's business model? 
3. Should you invest in SHLL?

SHLL and Hyliion merger – what you need to know.

Tortoise Acquisition Corp and Hyliion are merging in the imminent future, with the new company trading under the ticker symbol (NYSE: HYLN). First, SHLL is a publicly-traded special purpose acquisition company. Essentially, their sole mission is to look for a merger. Also, SHLL holds a strategic focus on the energy sector and decarbonizing commercial transportation in North America. Considering SHLL’s mission, it makes sense for them to marge with Hyliion, an EV truck company looking to reduce greenhouse gas emissions.

Hyllion will receive $560 million from the merger. The funds will enable Hyllion to commercialise and complete the mass production of the businesses EV trucks. EV fever is causing stocks like Nikola (NASDAQ: NKLA), and Nio (NASDAQ: NIO) to experience unprecedented traction. Thus, it should come as no surprise that EV fever is latching onto the future company. Ultimately, the positive speculation around the Electric Vehicle market caused the SHLL buying frenzy this week.

Hyliion’s business model

Hyllion’s (Hybrid-Lithium-Ion) mission is to “reduce the carbon intensity and greenhouse gas (GHG) emissions of commercial transportation Class 8 vehicles, such as trucks, by being the leading provider of electrified powertrain solutions”. The EV company leverages software algorithms to ensure the trucks can decrease its ecological impact. Despite the fairytale story, Hyllion does not currently have a product on the market yet. I’ll repeat that Hyllion does not have a product on the market. Thus, no matter how ecologically visionary Hyliion is, the speculation is quite dangerous.

Is SHLL a viable investment?

Before I start, I am obliged to remind our viewers that this is not advice only general commentary from my extensive research in this area.

Short answer: SHLL has the potential to rise as long, at the music keeps playing (opinion not advice).

Getting in on the SHLL hype

Riding the wave is luring. Especially, as speculative companies like Hertz (NASDAQ: HTZ), Nikola (NASDAQ: NKLA), and Inovio Pharmaceuticals (NASDAQ: INO) are giving investors unrealistic gains. Investing in the SHLL trend could possibly provide a small gain next week. Because the aftermarket trading suggests investor confidence is raising the resistance levels. Also, if we are going off the growth of NKLA before hey finalised their merger, than SHLL may have room to grow. However, the music could stop or slow down if the coronavirus fears infiltrate SHLL investors’ minds, causing a sell-off. Ultimately, leaving you with a loss. If I were investing, I would look for a modest gain of 5%-10% to mitigate the risk of being caught in the sell-off trap. (Opinion not advice)

Investing in the warrant and shorting the SHLL stock

The beauty of investing is that there are usually multiple angles you can play. In the case of the SHLL and Hyliion merger, we have the warrant-stock arbitrage strategy. The strategy involves going long on the warrant and shorting, either through a put or selling a call, the SHLL stock. The warrant is another way for a company to raise capital and is like an option in that you buy the stock at a certain strike price in the future. Ultimately, as the stock overinflates, the warrant price will rise, allowing you to profit if you bought the warrant early. Then when the stock finds a more natural equilibrium, you could profit off your short. Overall, a more lucrative play on the future company and a short on the current speculation.

Understand the risks

The growth is purely off speculation. Speculation is the mother of evil. At one moment you can be on top of the wave, the next the wave drowns you and your board. Thus, if you invest in SHLL, make sure you understand the risk of speculation, and your investment reflects your financial interests.

 

If you enjoy our article or are wanting to learn more, you can subscribe to us for free via email and get updated when we post a new article. From all of us at YIG, thank you for the support.

The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.

Here is our free, uncomplicated, and extensive ASX portfolio

https://youth-investment-group.com/portfolio/

Want access to free, uncomplicated, and smart COVID-19 Strategies then click below?

https://youth-investment-group.com/2020/04/09/how-to-profit-off-smart-investments-during-covid-19/ 

Written by Patrick McLoughlin, Senior Manager of YIG.

Why did Split It payments rise over 100% today – should you ride the wave or short?

Split it payments (ASX: SPT) soared 125% today. That is right over 100% in a single day, which is remarkable. Especially as rising coronavirus cases, recession alarms, and US protests continue to infect the markets with fear. It only feels like yesterday that Zip CO (ASX:Z1P) skyrocketed. First Afterpay (ASX:APT), then Z1P, and now SPT, goes to show there is always a bull market somewhere.

Table of contents 
1. Why did SPT rise today? 
2. How does SPT differ from other BNPL businesses? 
3. Investment strategies - ride the hype or short?

 

Why is SPT going wild today?

Today SPT signed a multi-year contract with MasterCard Incorporated (NYSE: MA). However, what exactly does this agreement mean for Split it? First, “SPT can leverage Matercard’s network of partners to extend and scale instalment functionality to consumers and merchants.” (ASX announcements) However, the partnership extends beyond furthering SPT’s global reach (customer base). Mastercard and Split it intend to develop other instalmeent products in the future. Essentially, the companies will combine their resources to expand their respective product ranges. Ultimately, increasing potential revenue.

The bulls instantly recognised the significance of the partnership, driving SPT up to $1.51. The slight sell-off to $1.26 represents day traders off loading their gains. They probably saw it smarter to cash in on the profit instead of trusting in the future, which is extremely volatile (opinion not advice). However, the decrease caused an insurgence of even more bulls looking to ride the wave. Therefore, SPT skyrocketed today because of the partnership and investors looking to ride the wave towards the end of the trading day.

Split it payments business model

The potential SPT holds is within its unique variation to the BNPL industry. SPT directly charges your debit/credit account without the need for a middle man such as AfterPay or ZIP. This partnership with MasterCard concretes this business model, an exciting development in the fast evolving BNPL industry.

About SPT and its payment solution

“Splitit is a payment method solution enabling customers to pay for purchases with an existing debit or credit card by splitting the cost into interest and fee free monthly payments, without additional registrations or applications. Splitit enables merchants to offer their customers an easy way to pay for purchases in monthly instalments with instant approval, decreasing cart abandonment rates and increasing revenue.”

SPT Press Release 18/06/2020

The unique business model of SPT is an exciting attribute attracting long term shareholders. The MasterCard news solidifies the possibilities that SPT have been advertising to investors for years.

Is Split it payments worth the investment?

Before I start, I am obliged to remind our viewers that this is not advice only general commentary from my extensive research in this area.

Short answer: Yes, however, timing is impeccable.

You could invest in SPT in three ways. Riding the hype, shorting, or investing for the long-term. (Opinion not advice).

Riding the wave

Investing now (buying low) to sell at a higher price is the most enticing but also the riskiest investing strategy. First, getting your hands on SPT’s shares will not be a problem. Because many investors will be selling their shares. However, many investors should ask themselves, why would investors buy your shares off you at a higher price? Honestly, in my eyes, there is no incentive for future buyers. Today’s volcanic activity represents buyers getting in off a positive announcement.

However, if another investor believes the stock will grow then you could make money.  Think of it as a pool of people all thinking the stock is up today, and it must go up right. Whoever in that pool gets in first often makes money off other traders who were too apprehensive. Classic example of first in best dressed. Overall, riding the wave could be successful, but be careful as it does hold considerable risk.

Shorting SPT

Considering the risks of riding the wave, many investors might gravitate towards shorting the stock. At a base level investing in the belief that a sell off is inevitable might seem attractive. Especially, as you would have rising coronavirus, recession alarms, and US social chaos posing the threat of market-wide fear. Thus, you might be able to predict the future stock movements of SPT. However, risk is still present. Because what is to say, the surfers riding the wave are not wrong, and the stock continues to rise. If that were the case you would be left with some nasty premiums on your SPT put options. Considering Z1P continued to surge after its Quadpay announcement, this is the rsik you take.

Investing in SPT for the long-term?

Honestly, Warren Buffet could not have said it better, “What is going to happen in a day, month or even a year I don’t know, nor do I believe is important.” Investing in SPT for the long-term is a completely different story. With long term intentions, you would not be as emotionally invested in short term fluctuations in SPT’s stock price, which the above two strategies are prone to.  If I was investing in SPT for the long term I would invest some capital with profits from the sell-off. Because a decline is inevitable, but the timing is anyone’s guess (opinion not advice). If the fear causes the markets to plummet again, I would pick up more SPT at a discount. Ultimately, bringing down my average price.

SPT has proven it can deliver on it’s exciting and dynamic business model, making it a stock to watch.

If you enjoy our article or are wanting to learn more, you can subscribe to us for free via email and get updated when we post a new article. From all of us at YIG, thank you for the support.

The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.

Here is our free, uncomplicated, and extensive ASX portfolio

https://youth-investment-group.com/portfolio/

Want access to free, uncomplicated, and smart COVID-19 Strategies then click below?

https://youth-investment-group.com/2020/04/09/how-to-profit-off-smart-investments-during-covid-19/ 

Written by Patrick McLoughlin, and Tyger Fitzpatrick, Senior Manager, and Founder of YIG.