Heated Earnings Before the Election
It's a big earnings week for major companies. And election years make for volatile returns. In the past, election years have been up markets but no one has ever experienced a nationwide pandemic in the past.
Big Tech Earnings are Here
Big week, results. Coming hot off the antitrust cases, Big Tech will have big announcements. Google, Apple, Microsoft and Facebook will provide guidance on earnings and new products.
Google's Antitrust Case is Hot
On Thursday, Google will have a lot to say. After last week's antitrust case from the Justice Department, the company will be bombarded with related questions. Investors will be concerned about the breakup value of Google's departments. The unanswered questions will be about Android and Chrome. Google's search business is under fire but I don't believe the Justice Department has a strong case against the company.
$2 billion in iPhones Preorders
Speaking of Monopolies, Apple owns the premium smartphone market. The company commands a high margins and high prices for every new phone. Demand is at all-time high with the recent announcement of the iPhone 12. About 2 million units have been pre-sold, or $2 billion in pre-orders. This is ~800,000 more units than the previous iPhone 11. I wasn't impressed by the recent phone launch but 2 million enthusiasts are putting their money where their mouth is.
New Tech IPO List
Ant Group, formerly known as Ant Financial and Alipay, plans to IPO. This will be the most valuable FinTech company in the world. No surprise as it comes from the Alibaba parent company, the largest B2B ecommerce marketplace in the world.
Ant will raise $34.5 billion from investors, valuing the company at $313 billion. Talk about unicorns. Ant is a mega, mega-unicorn. Saudi Aramco only raised $29 billion during its IPO. The Ant Group will become the largest listing of all time. Making it bigger than Goldman Sachs.
A possible dual-listing between the Hong Kong and Shanghai stock exchanges will also make for an interesting outcome. The Ant Group can expect a very diverse and global investor group based on its mega unicorn status. The stock is expected to trade on November 5th, only days after the U.S. presidential election.
Add Stocks to Your Christmas Shopping List
Now is the time to build up your ecommerce shopping list. Not the products you want to buy. The companies you want to own for the long-term. 2020 is an inflection point for ecommerce sales. We've seen ten years of development in less than ten months.
It's time to cycle out of poor performing retailers that wont recover from the pandemic losses. Days after the election we will know who has a fighting chance. No stimulus plan will be released before our next President is determined.
I don't have any good ecommerce recommendations at the moment. Besides the big names like Amazon and Wayfair, no one will see a major catalyst within the week. Earnings will give us some guidance but no certainty before the elections.
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