✈️ This Stock Is Going On the Offensive

Plus, the number of millionaires the US added last year

Happy Friday afternoon to everyone on The Street. Here's a snapshot of where markets ended the trading session, plus tomorrow's trade idea delivered to you today.

  • 🟥 | US Stocks Fell on Friday. All three major indexes slipped lower today due to the stronger-than-expected jobs report. However, each of the three indexes notched winning weeks.

  • 📈 | One Notable Gainer: Consumer tech company Oddity Tech saw its shares surge 21% after its board of directors approved a $150 million share buyback program, and the company raised its Q2 revenue guidance.

  • 📉 | One Notable Decliner: Shares of semiconductor supplier Semtech plummeted 18% after its CEO Paul Pickle abruptly left the company. Semtech claims he was terminated after a disagreement with its board of directors.

  • ✈️ | Tomorrow's Trade: This Stock Is Going On the Offensive. Scroll down for more.

Plus, did you know some credit cards can actually help you get out of debt faster?

YESTERDAY’S POLL RESULTS

🟨🟨🟨🟨🟨⬜️ Bullish

🟩🟩🟩🟩🟩🟩 Bearish

S&P 500 Heatmap. Credit: Finviz

All Stock Heatmap. Credit: Finviz

All Stock Heatmap. Credit: Finviz

Global ADR snapshot. Credit: Finviz

MARKET MOVERS

PL (+12%) American Earth imaging company Planet Labs delivered record quarterly revenue of $60.4 million, up 15% year-over-year (YF)

GERN (+18%) Biotechnology company Geron saw its stock jump after winning its first FDA approval for Rytelo, a blood disorder drug (Reuters)

SKX (+2%) Shares of Sketchers rose after Bank of America upgraded the stock, believing the shoemaker will benefit from an improving wholesale market (SA)

IOT (-12%) Software maker Samsara’s stock dropped despite reporting an earnings beat and lifting its full-year guidance (Investopedia)

NEM (-5%) Shares of Newmont and other gold mining companies fell as the price of the precious metal has cooled in recent weeks (CBS)

TOGETHER WITH FINANCE BUZZ

Did you know some credit cards can actually help you get out of debt faster? Yes, it sounds crazy. But it’s true. The secret: Find a card with a “0% intro APR" period for balance transfers. Then, transfer your debt balance and pay it down as much as possible during the intro period. No interest means you could pay off the debt faster.

OVERHEARD ON THE STREET

Bloomberg: The largest union at Samsung Electronics went on a strike for the first time in the company’s 55-year history over a pay dispute.

CNN: Treasury Secretary Janet Yellen warned bankers and tech executives that AI in finance poses “significant risks.”

The Verge: Tesla shareholders warn that CEO Elon Musk could leave if his $56 billion pay package is not approved.

CNN: General Mills, the manufacturer of Cheerios, is being sued by eight Black employees working at a Georgia plant for racism among its White managers.

WSJ: United Airlines has begun monetizing its customers’ data by showing personalized ads on its planes’ seat-back screens.

TOMORROW’S TRADE IDEA, TODAY

Treading Water

Lockheed Martin (LMT) is the largest defense contractor in the Western Hemisphere. Its 2023 sales totaled $68 billion, yet its stock has underperformed the S&P 500 over the past five years. Supply chain issues and government spending cuts have bogged the company down. 

Investors expected the stock to get a boost from various geopolitical conflicts over the past few years, but this didn’t come to pass. 

Some analysts think the stock is about to turn around, which could provide investors with an opportunity.

Tailwinds

Lockheed currently has a substantial backlog of orders and it’s working on strengthening manufacturing. 

On the shareholder side, the company has introduced significant stock buybacks and a strong dividend, which should provide a boost to share prices. 

Seaport Research Partners analyst Richard Safran gave the stock a $551 price target, an 18% upside from yesterday’s close. As it stands, only 32% of analysts covering Lockheed give it a buy rating, far less than the 55% average for S&P 500 listed stocks. 

Improving Fundamentals

The Wall Street consensus is that Lockheed will grow EPS by 6% annually through 2026. Free cash flow is expected to hit $19 billion over the same period, much of which will be used for the company’s stock buyback program. 

CFRA analyst Stewart Glickman says Congress’s 2025 appropriations bill will largely determine Lockheed’s future since 75% of the company’s sales come from the US government. The bill will outline military spending for the year, providing important information for potential investors. 

Glickman expects the defense stock to trade at a premium to the S&P soon, indicating that now could be an opportune time to get the stock at a discount.

Are you bullish or bearish on Lockheed Martin (LMT) over the next 12 months?

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TOGETHER WITH FINANCE BUZZ

Did you know some credit cards can actually help you get out of debt faster? Yes, it sounds crazy. But it’s true. The secret: Find a card with a “0% intro APR" period for balance transfers. Then, transfer your debt balance and pay it down as much as possible during the intro period. No interest means you could pay off the debt faster.

ON OUR RADAR

CNBC: The U.S. far outpaced the rest of the world in minting millionaires last year, adding 600,000 new millionaires and powering record fortunes at the top.

Bloomberg: The multifamily sector has the highest share of properties with potential distress, with more than $56 billion worth of real estate at risk.

Fox Business: Meme stock retail trader Keith Gill claims his investment in GameStop is a bet on management and a transformation stage for the retailer.

Globe and Mail: Canadian PM Justin Trudeau has said that real estate needs to be more affordable, but lowering home prices would put retirement plans at risk.

Newsweek: Tillamook County Creamery Association is warning consumers that packages of cheese sold at Costco stores may contain "foreign plastic material."

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