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Pencils down, it’s time for lunch. Here’s what you missed this morning:
🟨 | Market Snapshot: The Dow slipped over 200 points and the S&P 500 hovered near record highs as more data indicates that inflation pressures may be cooling.
😯 | In focus: A pleasant surprise… The producer price index showed that wholesale prices unexpectedly fell 0.2% in May, upending expectations of a 0.1% increase. It’s also a welcomed change to the 0.5% increase we saw in April.
🗣️| Noteworthy: Microsoft’s president, Brad Smith, was brought in front of Congress today to testify to the company’s security practices following “avoidable errors” that allowed Chinese hackers to steal 60,000 US State Department emails.
💰 | The Midday Trade: The Unexpected Beneficiaries of AI. Scroll down for more.
Plus, our partner finds undervalued companies, acquires them, improves them, and sells them. (And lets you invest)
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TOGETHER WITH WEBSTREET
Not long ago, investors were chasing rocketship startups in hopes of a huge payday.
Boy how times have changed.
Those overvalued, buzzy startups just aren't as attractive anymore. You know what's cool? Undervalued companies that earn real profit.
WebStreet finds these companies, acquires them, improves them, and sells them. (And lets you invest)
They buy overlooked businesses already earning money
They improve operations, so they make even more money
They bundle everything into a single, powerful fund that you can invest in. It's like micro private equity on autopilot.
STREET STATS
MORNING MOVERS
AVGO: Broadcom’s stock popped this morning after its Q2 earnings beat analysts’ estimates, and the company announced a 10-for-1 stock split (CNBC)
TSLA: Shares of Tesla rose after CEO Elon Musk said he is set for victory in the shareholder vote on his $56 billion pay package (Reuters)
PLAY: Dave & Buster’s missed Q1 earnings and revenue estimates with EPS of $1.12 compared to estimates of $1.56, causing its stock to dive (YF)
OXM: Leading apparel company Oxford Industries saw its stock fall after reporting a 5% decline in net sales during the first quarter (Investing.com)
SPCE: Shares of Virgin Galactic plunged after the space tourism company announced a reverse stock split (MW)
TOP CALLS
Broadcom: UBS Maintains Buy on Broadcom, Raises Price Target to $1735 (Trade It)
Zhihu: Citigroup Maintains Buy on Zhihu, Lowers Price Target to $5.4 (Trade It)
NextEra: Barclays Downgrades NextEra Energy Partners to Underweight, Lowers Price Target to $25 (Trade It)
Williams Companies: RBC Capital Maintains Outperform on Williams Companies, Raises Price Target to $44 (Trade It)
SiteOne: Loop Capital Maintains Hold on SiteOne Landscape Supply, Lowers Price Target to $140 (Trade It)
Robinhood: Citigroup Maintains Sell on Robinhood Markets, Raises Price Target to $18 (Trade It)
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THE MIDDAY TRADE
Thinking Outside the Box
Liontrust Asset Management analyst Clare Pleydell-Bouverie isn’t just interested in the big-name AI companies like Nvidia (NVDA) and Microsoft (MSFT).
She believes AI is set to increase productivity and efficiency for several under-the-radar and outside-the-box companies adopting the technology. According to the analyst, it will allow them to focus on growth and relinquish much of their administrative tasks.
JPMorgan
When you think of AI, you probably don’t think of banking. However, according to Pleydell-Bouviere, investment bank JPMorgan (JPM) will be able to use the technology to slash manual work by 90%.
The bank is currently in the process of creating an AI software called IndexGPT that is capable of choosing investments based on specific customer needs.
20 of the 28 analysts covering the stock give it a buy rating with an average price target of $213.09.
L’Oreal
Even beauty company L’Oreal (LRLCY) is getting in on the AI action. It currently employs a generative AI “beauty assistant” that is beating in-store advisors from a customer conversion standpoint by 60%.
The technology, called “Beauty Genius,” responds to customer questions and recommends products and routines specific to each user.
Analysts have given it an average price target of $450.25, and 11 of 26 covering the stock give it a buy or overweight rating.
The AI boom doesn’t just benefit the companies creating the technology, it also gives a boost to those that utilize it. Investors looking to gain AI exposure outside of the big tech companies can look to stocks like these.
TOGETHER WITH WEBSTREET
Not long ago, investors were chasing rocketship startups in hopes of a huge payday.
Boy how times have changed.
Those overvalued, buzzy startups just aren't as attractive anymore. You know what's cool? Undervalued companies that earn real profit.
WebStreet finds these companies, acquires them, improves them, and sells them. (And lets you invest)
They buy overlooked businesses already earning money
They improve operations, so they make even more money
They bundle everything into a single, powerful fund that you can invest in. It's like micro private equity on autopilot.
SURVEY THE STREET
Over the past few months, Chinese exports have faced tariffs, tariffs, and… some more tariffs.
Last month, President Biden issued a 100% border tax on electric cars from China. And yesterday, the EU placed a 38% tariff on Chinese EVs.
Despite these tariffs that seek to handicap China’s sprint towards global EV dominance, Chinese EV stocks surged this week.
Plus, Yesterday’s Poll + Results:
🟩🟩🟩🟩🟩🟩 Yes ✅
🟨🟨🟨🟨⬜️⬜️ No ❌
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