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▪ And much more
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We had another slow session on Wednesday as the market sits directionless ahead of some big economic data set for the next couple of days. However, the major indices managed to stay on the positive side this time.
The S&P rose by 0.14% to 4208.12, while the NASDAQ advanced by the same percentage (or nearly 20 points) to 13,756.33. Both of these indices started the week slightly lower yesterday.
Meanwhile, the Dow climbed a modest 0.07% (or about 25 points) to 34,600.38. That makes five straight days of gains for the index, though it has only advanced about 0.8% in that time amid all the sluggishness.
The slow trading makes the ‘meme mania’ stick out even more, though a 95% surge would probably attract a lot of attention in any environment. That’s how much AMC Entertainment (NYSE:AMC) soared today, as retail investors have made this movie theater company their new project.
And AMC is fine with all the craziness. The company just launched the AMC Investor Connect initiative to stay in contact with its “extraordinary base of enthusiastic and passionate individual shareholders”.
Meanwhile, it is also raising capital to make improvements for the future. For example, it recently sold more than $230 million worth of shares to a hedge fund… which then promptly sold it for a nice profit.
Investors are anxiously awaiting the monthly jobs report, which is just two days away now due to the short week. Expectations are for somewhere north of 650K, but we all know how far off expectations were last month when the result missed by more than 700K.
There’s plenty of data coming tomorrow too, including the ADP employment report. Last month, this result came to 742K for April, which marked a nice improvement over the previous month’s 565K though missed expectations of 800K. And as usual, we’ll be getting the weekly jobless claims number.
The ISM services is also scheduled for Thursday. It came to 62.7 for April, which was below the previous month though well within expansion territory over 50.
Today's Portfolio Highlights:
Stocks Under $10: The transportation space is “on fire” of late, so Brian added a name from this industry with “amazing” earnings estimate revisions and a great valuation. Diana Shipping (NYSE:DSX) specializes in transporting dry bulk cargoes along worldwide shipping routes, including iron ore, coal, grain and other materials. The editor thinks the turnaround has begun for DSX, which just snapped three quarters of earnings misses with a 50% positive surprise in its most recent release. Earnings estimates have been soaring in recent weeks with this year moving to a profit of 34 cents from a loss of 5 cents over 60 days. Next year’s improvement is even more impressive by soaring to $1.32 from 32 cents in that time. Brian likes DSX’s solid fundamentals and believes it will move higher along with other transportation names as the economy continues to open up. Read the full write-up for more on this move.
Surprise Trader: Its now been 15 straight quarters of meeting or beating the Zacks Consensus Estimate for Signet Jewelers (NYSE:SIG)… and Dave expects that trend to continue when it reports again before the bell on Thursday, June 10. This Zacks Rank #2 (Buy) jewelry retailer beat by 15% last time and has a positive Earnings ESP of 2.84% for the quarter coming next week. The editor added SIG on Wednesday with a 12.5% allocation, while also getting out of Capri Holdings (NYSE:CPRI) with a slight gain. Read the full write-up for more. In other news, Dillards (DDS) continues to pay off for the service as the department store staple rose 18.1% today, which was the best performance among all ZU names. The company is also the biggest winner over the past 30 days with a gain of more than 54%.
Counterstrike: "While the overall market could have put you to sleep, some “stonks” or “meme stocks” were back. AMC (AMC) led the way with an absurd move higher that had the stock up over 100%. BBBY, GME, KOSS, RKT and BB also had big moves higher. These stocks are fueled by a mania, not fundamental or technical reasons.
"The AMC move stemmed from some neat moves by the company that are bringing shareholders together and even offering free popcorn at movies to those that hold the stock.
"These gimmicks don’t add any real value, but can drive this momentum. And if the momo continues and the company can do more stock offerings to raise money, it will put them in great shape to thrive after the pandemic.
"After they have cash, they can pay debt, buy distressed theaters and actually grow!" -- Jeremy Mullin
Until Tomorrow,
Jim Giaquinto
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