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Friday Four Play: The “Crypto Goes Viral” Edition
To paraphrase Dr. Ian Malcolm, “Capitalism, uh, finds a way.”
If you’re not familiar with the great Dr. Ian Malcolm, he’s the chaos theory mathematician from 1993’s smash hit Jurassic Park. And the nifty little cryptocurrency I discovered this morning is nothing short of chaos.
Say hello to the CoronaCoin. According to a post on Reddit, the CoronaCoin is a way to bet on the COVID-19 virus pandemic. Here’s the info:
Bet on the coronavirus pandemic by investing on CoronaCoin, the more the virus spreads the more valuable the token becomes.
CoronaCoin (NCOV) is a ERC20-compliant token. The total supply is based on the world population (7,604,953,650 NCOV) and the token will be burnt once every 48 hours depending on the number of infected people and fatalities, so the token is deflationary and also non-mintable.
CoronaCoin’s website touts the crypto as the “world’s first coin backed by proof of death.” Does that mean it’s backed by death certificates?
It’s clearly not backed by the coronavirus itself — I’m not even sure what it would mean to back a crypto with a virus.
How would you even take delivery? Why would you even take delivery?
Now, I have no idea if the CoronaCoin is a real thing. (Is any cryptocurrency a real thing? For that matter, is any fiat currency truly real?) However, I find myself simultaneously disgusted and intrigued by the idea.
On one hand, we’re betting on death and ostensibly profiting from a virus outbreak. Rooting for the death rate to climb is in bad taste, to put it mildly.
On the other hand, think of the hedging and speculation possibilities. The CoronaCoin could be the perfect hedge to every issue surrounding this outbreak. (By the way, hedge funds have been doing this with bonds for years already.)
One thing’s for certain: Capitalism does, indeed, find a way.
And now for something completely different … here’s your Friday Four Play:
No. 1: Corona and Coke
Speaking of COVID-19, The Coca-Cola Co. (NYSE: KO) joined the growing list of companies warning that the virus would negatively impact earnings.
This morning, Coke said that the coronavirus would shave $0.01 to $0.02 per share off current-quarter earnings. Unit case volume is expected to slip, as is organic revenue. (But is that free-range, cage-free organic revenue? Hmm?)
But never fear, Coke investors! Despite China being the company’s third-largest global market (according to case volume), Coke maintained its full-year outlook. What’s more, it also boosted its quarterly dividend by 2.5% to $0.41 per share.
If you’re curious, Coke’s dividend pays out on April 1 to shareholders of record as of March 16.
So, you have that going for you … which is nice.
No. 2: Dropbox Like It’s Hot
Today, shares of Dropbox Inc. (Nasdaq: DBX) enjoyed their best day since going public. Indeed, DBX surged nearly 25% on the open this morning, as analysts lauded Dropbox’s quarterly report as a turning point.
Deutsche Bank AG’s (NYSE: DB) Karl Keirstead called the company’s report “potentially thesis-changing.” Yes, it was a veritable love fest for Dropbox today.
So, what has practically the entire analyst community buzzing? It was partially the 19% surge in revenue on the quarter. But the real stunner was Dropbox’s boosted operating margins.
The company lifted operating-margin forecasts to land between 28% to 30% by 2024, up from previous estimates of between 20% and 22%. That’s a pretty significant jump — “shocking,” as Bernstein Global Wealth Management analyst Zen Chrane would say.
Oh, and Dropbox also authorized a $600 million stock buyback plan. I hear that’s the thing to do these days — even if your stock is trading near all-time highs.
Cutting through the hype, the bottom line is that a bit of profit-taking might be in order if you’re a DBX shareholder — just a bit, you know. The company has solid prospects and has successfully dismissed subscriber growth concerns, so its outlook is solid. Today’s spike is a bit rich, however, and better prices should emerge in the next week or so.
No. 3: Martha, My Deere!
During the worst of the U.S.-China trade war, Deere & Co. (NYSE: DE) found itself in the thick of it. But the “phase 1” deal is on, and Deere’s helping itself to a bit of what is all around. (That Beatles reference was way too much work…)
The point I’m awkwardly trying to convey is that Deere dug deep and grew amazing profits last quarter. Earnings and revenue both blew past Wall Street’s targets, and the company held firm on full-year guidance.
More importantly, however, Deere said that farmer confidence is rising. “Farmer confidence, though still subdued, has improved due in part to hopes for a relaxation of trade tensions and higher agricultural exports,” said CEO, John May.
Deere is looking for $2.9 billion in sales this year. Holding that line will be important for the company — especially when so many others have issued coronavirus warnings.
No. 4: Cloudy With a Chance of Sell-Offs
Sun, sun, sun … here it comes. And there it went. Whoosh!
Shares of First Solar Inc. (Nasdaq: FSLR) plunged more than 13% today, after it reported a bearish trifecta. The company saw a loss of $0.56 per share on revenue of $1.4 billion. Wall Street was looking for a profit of $2.75 per share on sales of $1.7 billion. It even lowered guidance for fiscal 2020. Oof…
For the full year, First Solar expects to earn $3.25 to $3.75 per share on revenue ranging from $2.7 billion to $2.9 billion. The consensus stands at $3.64 per share, and sales of $3.36 billion.
For a company based in Tempe, Arizona, that forecast isn’t sunny at all. What’s more, First Solar is considering exiting its solar farm-building business.
“Given the significant evolution of developing utility-scale PV projects in the U.S., we believe now is an appropriate time to evaluate our options,” said CEO, Mark Widmar.
That’s code for: “Competition is killing our solar farm-building business, so we’re getting out of Dodge.”
Hopefully, First Solar can get some much-needed cash for its solar farm business and then redouble its efforts on panels and the like. It needs to stem those losses somehow.
Great Stuff: Go Viral With Blockchain
Are you happy now, capitalism? Is this the end game: crypto coins backed by death?
I mean, I know I told you earlier this week to suck the marrow out of the bull market … but not like this!
Whatever you hear about CoronaCoin going forward — because someone somewhere will undoubtedly figure out a way to make a crap-load of cash from it — remember to ask yourself this week’s handy little mantra…
Am I speculating? Or am I investing? (Or are we dancer?)
If you’re looking for real, bona fide investment research into the tech that makes cryptocurrency possible, “blockchain” is what you’re looking for. Today’s blockchain leaders are solid, well-run companies that thrive on, you know … actual business models and not global pandemics.
You know who knows the blockchain industry inside and out? Banyan Hill expert Paul Mampilly!
Mampilly knows … and you don’t want to wait on the sidelines, as this brand-new blockchain industry is expected to surge up to 77,400%!
Click here now to learn more about Paul Mampilly’s blockchain research.
That’s all for this week. But don’t fret, you can get more meme-y market goodness by following us on Facebook and Twitter!
Until next time, good trading!
Regards,
Joseph Hargett
Editor, Great Stuff
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