What's Going On With $PLTR? - $AMD $PFE $WMT
What's Going On With $PLTR?
Straight from Benzinga newsdesk, hosts Michael O'Connor and David Willey bring you the market news and stocks to watch.
Subscribe to our Stocks To Watch Newsletter here : https://go.benzinga.com/sales-page-187126583617110118712659
Today's Stocks: $AMD $PFE $PLTR $WMT $BELFA
Hosts: Michael O'Connor , Benzinga Newsdesk
Reach out to Michael at michaeloconnor@benzinga.com
Benzinga Strategy Development
David Willey , Benzinga Newsdesk
Reach out to David at davidwilley@benzinga.com
Straight from Benzinga newsdesk, hosts Michael O'Connor and David Willey bring you the market news and stocks to watch.
Subscribe to our Stocks To Watch Newsletter here : https://go.benzinga.com/sales-page-187126583617110118712659
Today's Stocks: $AMD $PFE $PLTR $WMT $BELFA
Hosts: Michael O'Connor , Benzinga Newsdesk
Reach out to Michael at michaeloconnor@benzinga.com
Benzinga Strategy Development
David Willey , Benzinga Newsdesk
Reach out to David at davidwilley@benzinga.com
Transcript
00:00 Good morning, Zinger Nation. Today is Tuesday, August 1st, the beginning of the month of
00:09 August. Holy smokes, ladies and gentlemen, boys and girls. And it is the year 2023. Hope
00:16 everyone is having a great Tuesday, a great start to your week. Mr. David Willey, the
00:20 illustrious co-host of Benzinga Daily Stocks to Watch is here as well. My name is Michael
00:25 O'Connor. How are you doing today, David?
00:28 I'm doing fantastic. Thank you, Michael. Yep. Can't believe August is finally rolled around,
00:34 but just keeps on chugging and it's a beautiful day here. So it's going to be nice. I'm hoping
00:40 to get some outside, get some melatonin, you know, and melanin.
00:44 Going to go to sleep.
00:48 Exactly.
00:49 Well, fair enough. I feel like a really nice day is perfect to go outside and do some things
00:56 and then take a midday nap. So maybe that'll be a good lunch break. Before it's nap time,
01:03 it is stock time and we've got some five specifically fresh ideas right off the Benzinga Pro News
01:09 Desk grill. A little bit of a plug as well. If you're watching us live, you're able to
01:14 see Benzinga Pro. Boom. It should be most of the screen. We're kind of off to the side
01:21 as we should be. We're the voices, but we're focused on the stocks. If you don't already
01:25 check out Benzinga Pro, check out all of the tools that we have over at Benzinga. It's
01:32 the best way to get very fast, very actionable news and insights. And I know sometimes we
01:37 plug, sometimes we just kind of focus on it, but I always want to remind folks that check
01:42 out a free trial, do something, but check it out. It's an amazing platform. If you're
01:46 just listening to us, then you don't see anything going on, but check out pro.benzinga.com.
01:51 All right, starting off into our list, into our stocks to watch for today. Ticker number
01:58 one, we've got advanced micro devices. That's ticker AMD. Number two, we've got Pfizer.
02:05 That's ticker PFE. Number three, we've got Palantir, which is ticker PLTR. Number four,
02:11 we've got Walmart. That's WMT. And stock to watch number five. I had never heard of this
02:16 company before. So this is a fun one. Bell Fuse, that's ticker B-E-L-F-A, Belfa. But
02:23 starting off with number one, that's AMD, advanced micro devices. Down a little bit
02:29 on the morning, just a tiny, tiny thread of a downward move after a pretty flat month.
02:38 But we saw some pretty intense movement over the past three months, up over 25%, up over
02:45 73% year to date. And importantly, today after market close is going to be AMD's earnings.
02:53 It's going to be important to watch what happens. I think we talked about, which was the, we
02:58 talked about another on semiconductor yesterday. We talked about how maybe the expectations,
03:03 the whole Nvidia time span where the expectations were really, really high for the semiconductor
03:09 industry might be starting to close out. It's going to be, I think, very valuable to look
03:15 at AMD, watch how they move after their earnings reports. If they're able to, you know, beat
03:20 by a little bit, if they're, if they're on track and they're still moving upward, I think
03:24 that would be a good secondary confirmation that expectations for the semiconductor industry
03:29 have started to maybe go back to a normal quote unquote normal spot instead of some
03:36 really intense growth outlook. Estimates are right at about 57 cents per share for earnings
03:43 per share. And AMD, one of the biggest and most important semiconductor companies out
03:48 there. If you're in the industry, if you're looking at technology, I mean, it's their
03:53 chips are in just about everything these days. So definitely a stock to watch.
03:59 Our second stock to watch this morning is Pfizer Inc. That's ticker PFE. Now Wall Street
04:07 expected Pfizer to post quarterly earnings at 57 cents per share on revenue of just over
04:13 13 billion before the opening bell. Pfizer initially gained a little bit in after hours
04:19 trading but has since dipped and we're seeing it down, not much, but definitely down a little
04:26 bit this morning. Now Pfizer posted their results about half an hour ago and definitely
04:35 these were not great results for them. They, they particularly saw a loss in their sort
04:42 of COVID products area. So their COVID vaccine, I think saw about one and a half billion dollars
04:49 in sales, but that was down 83% from a year ago. Then the antiviral pill Paxlovid posted
04:58 143 million in revenue and that was a drop of 98%. So combined, they saw that their COVID
05:09 products or revenue of 1.6 billion, which was compared with about 17 billion in sales
05:17 from the same period a year ago. So really, now I think that their revenue did not meet
05:25 expectations, their earnings per share slightly beat expectations. But overall, this is definitely
05:31 a difficult time for Pfizer as they're sort of, they, you know, they invested so heavily
05:37 in COVID and COVID products. And now as you know, the world sort of comes out of the pandemic,
05:45 slightly left holding all of these products and nothing to do with them. And their stock
05:50 is definitely, you know, the past, if you look at the past month, the past six months,
05:56 really, you know, they, they hit a high in, I think, December, 2021. And ever since then,
06:00 they've just been coming down. They've fallen about 17, almost 18% in the past six months.
06:08 So, you know, they didn't do terribly compared with the expectations, but compared with their
06:16 performance last year in terms of actual revenue, things are not great for Pfizer.
06:21 I think this is a really important story to touch on because with COVID going endemic
06:28 instead of pandemic, it's going to be around like flu. It's going to be, I mean, it's not
06:32 fun. I mean, I've, I've, I've had COVID. I know many people have had COVID and it's something
06:36 where it's going to be around a while. The really intense drive for healthcare supplies
06:42 and everything is not around anymore as Pfizer seeing, but I don't know. I think it'll still,
06:47 it'll still be a decent chunk of revenue for Pfizer, especially for antivirals. Testing
06:53 supplies for companies will probably still be pretty big, especially in seasonal cycles.
06:58 I think as we get into the fall and winter, it's going to be interesting to watch what
07:02 happens for the sales of these big pharma companies in relation to antivirals, specifically
07:07 anti-coronaviruses. So these companies that are in the first line of defense against these
07:13 viruses, an interesting story to watch. Speaking of defense, stock to watch number three is
07:19 Palantir Technologies. That's ticker PLTR. Wanted to get this one in front of everybody
07:26 because they have their earnings calls in five more days. And this is one that I think
07:32 is a hundred percent in earnings call that you should have on your list because of a
07:36 number of factors. Palantir was down quite a bit from its highs. It had reached $26 a
07:44 share back in November 5th, 2021, and then had a really long extended downward cycle
07:49 reaching about $6.29 back in December of this past year. And then it's had an absolutely
07:56 explosive year to date, almost 200% up on the year to date, massive, massive movements.
08:03 Why? What's going on? They've had a bunch of pretty darn big contracts with the Department
08:09 of Defense. They are really cooking and killing it, it seems like. So I think listening in
08:15 on this earnings call and seeing what they have to say for next steps for how the quarter
08:20 is going and what the next quarter is going to look like, I think will be very valuable,
08:24 whether you're directly invested in them, whether you're looking at them, or whether
08:28 you're looking at the software defense military industrial complex type industries, a hundred
08:34 percent a stock to watch. And five days, still got five days to prep for that earnings call,
08:39 but wanted to get that out in front of everybody before it happens.
08:43 And if I can ask, so I, to be honest, I had not really heard of this. I've heard of them
08:50 vaguely, but don't really know much about them. I mean, the extent of my exposure to
08:54 Palantir's comes from the Lord of the Rings. So I didn't know there was a whole company
09:00 based around building Palantir's, I guess. But I did hear about this Department of Defense
09:07 contract. So what is Palantir? And also, when a company takes on a big contract like this,
09:14 what is that saying for the company?
09:17 Well, I'm glad you asked David, and that's actually a great reference because that is,
09:22 if you've seen the Lord of the Rings, you may know that the Palantir's are the orbs
09:27 with which you can communicate over long distances and everything. That's what they're based
09:30 on. Their logo is literally the Palantir on a, like a dais, and they are a hundred percent
09:36 based on the thing from Lord of the Rings. That's what they're named after. And the reason
09:41 why is they are, they're essentially software targeted for military use for the most part.
09:48 That's like the kind of the bread and butter of what they're doing is software services
09:52 for military. So their goal is to create software that enables kind of highly advanced military
09:59 activity, combined arms operations. Some of their big platforms are Foundry, which is
10:07 kind of this, it's a whole system that they're building similar, I'd say probably similar
10:14 to like IBM Watson or Amazon's AWS. They're trying to build large scale platforms for
10:20 pretty specific uses to be highly secure, highly effective for a number of different
10:26 things. They also do automotive, financial compliance, legal intelligence, mergers and
10:31 acquisition solutions. They also have a product called Palantir Gossam. So they've got Foundry
10:37 and Gossam, a pretty interesting company. One of their founders was Peter Thiel, pretty
10:42 darn famous guy. And his current CEO is another co-founder, which is Alex Karp. You see him
10:47 pretty often in Benzing. We see him all around the place. He's saying interesting things
10:54 a lot, kind of a meme stock for a little while, but after some big wins with a large department
11:00 of defense contracts, they've pretty well been vindicated. Still some negative sentiment
11:07 around their current market cap. It's pretty high compared to what's coming in. But I think
11:13 that the important thing to note, we'll be listening in on the earnings call August 7th.
11:18 If you're interested in learning about what's going on with Palantir, what's going on in
11:22 the kind of niche defense software industry, it's probably one of the very few companies
11:28 that gives you a pure play opportunity. Lockheed Martin, Honeywell, Northrop Grumman, those
11:35 type of companies, they do these types of things too, but more of the heavy industry
11:40 and what they're known for in those bigger chunks. So Palantir, one of those pretty unique
11:44 software, military software, and general other enterprise software opportunities to look
11:51 at.
11:52 And I think that's really, that's fascinating because I think, especially just with the
11:57 importance, and we've talked about this several times before, but just the importance of AI
12:03 as it manifests in different sectors. I think AI in defense, and so I don't know if Palantir
12:10 is involved in developing AI software solutions. But I just think that will be a really interesting
12:17 seeing how artificial intelligence impacts weaponry and defense.
12:24 And so bonus ticker then for you is C3.AI. That is a pure play AI company that does do
12:32 military AI as well. So bonus stock to watch.
12:35 There we go.
12:36 C3.AI, that's the ticker, AI.
12:37 And this is why you should tune into Daily Stocks to Watch because there's always a little
12:41 extra something.
12:43 Exactly.
12:44 Now, our fourth stock to watch this morning is Walmart. That's ticker WMT. Now, Walmart
12:52 has just bought out the remaining shares of Flipkart, the e-commerce, Indian e-commerce
13:00 from Tiger Global, the investment fund for $1.4 billion. Walmart previously had, I think,
13:08 over 70% stake in Flipkart. It's purchased the remaining shares.
13:13 Flipkart is an e-commerce company based in India. And I think this move for Walmart is
13:22 in a sense, it's actually just trying to, you know, it's expanding its international
13:27 e-commerce opportunities, but it's competing for Amazon with this space.
13:31 You know, Amazon obviously has a lot of activity internationally, has a lot of international
13:38 markets. But the interesting thing, you know, I was reading this morning, Amazon, I think
13:43 seems as if Amazon has had a slight struggle with it's had to adapt its business model
13:48 in the different countries that it's entering, right? So India may be, you know, looking
13:53 at the delivery model, is that going to work? Or are you going to have as many digital payments
13:58 versus cash payments? So for a company like Amazon, it has to take the American model
14:04 and then readapt it in these different markets.
14:07 What Walmart is doing is essentially bypassing the need to do that by buying out a big company
14:13 like Flipkart. And then it's already established in the domestic economy.
14:22 This is one of those two great strategies of companies. If you can research and develop,
14:27 you can make your own stuff or you can pay a bunch of money and buy companies like Walmart,
14:32 one of those companies with huge cash reserves. I think Apple still is number one in the world
14:38 in terms of cash reserves. They've got an insane amount of just money lying around.
14:41 Walmart, not always well known for being a buyer. They seem to pretty rarely buy out
14:49 companies. It seems to be very strategic. So probably a well thought out, maybe, maybe
14:57 not, but probably a pretty strategic, well thought out acquisition with Walmart. 1.4
15:03 billion to acquire the rest of Flipkart's stake there.
15:07 Stock to watch number five is Belfuse. That's ticker B-E-L-F-A. This was on the movers this
15:14 morning when it was up over 4% pre-market and then back down actually about flat now
15:22 on the morning. But this was an interesting stock that I had never heard of. And we wanted
15:27 to get in front of you to talk about some of these small to mid cap industrial companies.
15:32 Belfuse quote, engages in the design, manufacture and marketing of products that power, protect
15:38 and connect electronic circuits. So this is pretty niche. This is specifically for electronic
15:44 circuits. It's got a P/E ratio of just over nine, a little less than half a percent dividend
15:50 yield, but some pretty solid results in terms of overall earnings over the last few quarters.
15:57 Looking at it year to year, gross profit margin is up to 32.9% up from 26.6 of Q2 of last
16:05 year. Net earnings are at 27.8 million versus 17 million Q2 of last year. Adjusted EBITDA
16:11 is 28.6 million up from 19.1 million Q2 of last year. They paid down $40 million of debt.
16:19 So unclear whether the move this morning was just kind of a fluke with people reacting
16:25 down actually 17% in the past week, which is interesting to look at. But the last three
16:30 months up over 27% and up over 70% year to date. Some of these smaller industrial names,
16:39 both myself and other other traders that I know anecdotally can be a unique way to try
16:44 and glean some value in the market. If they're just not well known, if there are not many
16:48 analysts covering it, not many people talking about it, but it's a profitable business that
16:53 seems to be doing well, could be an opportunity to look at. Want to get that in front of you.
16:58 All right, we're going to go back over our list. Make sure we didn't miss anything for
17:02 you and get you back out to your trading day. Stock to watch number one was Advanced Micro
17:08 Devices that sticker AMD. Number two, we had Pfizer, the sticker PFE. Number three was Palantir
17:15 that's PLTR. Number four was Walmart with WMT. And number five was Bell Fuse that sticker
17:23 BELFA. Hope everyone has a wonderful Tuesday. Happy August. Welcome to the last month of
17:31 real summer. This is crazy. We'll catch you tomorrow. As always, Mr. O'Connor, it's been
17:36 an honor. Take care everyone.
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