American stocks continued their remarkable surge, with the Dow Jones, S&P 500, and Nasdaq 100 indices soaring to their record highs. This recovery accelerated as the third-quarter earnings season kicked off and as hopes of a soft landing continued.
Stocks have also been fueled by the recent stimulus by the Chinese government.
Altogether, the Dow Jones has jumped by 14.6% this year, while the S&P 500 and Nasdaq 100 indices rose by almost 25%.
Alibaba (BABA)
Background
Alibaba is a top Chinese technology company that runs several large firms in China, including Taobao, Tmall, Aliexpress, Lazada, and Alibaba Cloud. It generates billions of dollars in annual revenue annually and is one of the most profitable firms in the country.
Summary
Alibaba stock has rebounded after Beijing unveiled a series of stimulus packages to cushion and reboot the economy, which is struggling to hit its 5% target. Part of the funds will be channeled towards Chinese equities.
Beijing has also completed its three-year supervision of the company, which contributed to its fall from grace. There are also signs that the company is severely undervalued after it lost over 50% of its value in the past few years. Also, Alibaba is repurchasing millions of shares, a move that will boost its earnings per share.
Review date: 19rd September
Hype change:
Price change: 14.7%
Sentiment: POSITIVE
Carnival | CCL
Background
Carnival (CCL) is one of the biggest cruise line companies globally. In addition to its eponymous brand, the company owns Princess Cruises, Holland America Line, Seabourn, Costa Cruises, and Cunard Line. It makes money through trip fares, onboard spending, travel packages, and passenger services like photography and laundry.
Summary
Carnival stock has surged recently, reaching its highest point since February 2022 for three main reasons. First, the cruise industry has bounced back, with most of its travelers being younger people.
Second, the forward bookings have given it over $6 billion in deposits, which it can use to fund its operations and invest to get interest. Third, there are signs that it is a highly undervalued company, especially when compared with Royal Caribbean.
Review date: 7th October
Hype change: 118%
Price change: 17.78%
Sentiment: POSITIVE
Micron (MU)
Background
Micron is a top player in the semiconductor industry, where it focuses on storage solutions like Dynamic Random-Access Memory (DRAM), NAND, and NOR memory chips. Its products are used by companies like Apple, Microsoft, Google, and Dell. It competes with the likes of Samsung and SK Hynix.
Summary
Micron stock has rebounded in the past few weeks after the company published its quarterly results in September. It has risen by over 31% from its lowest point in September. Its results showed that its revenue rose to $7.7 billion in the fiscal fourth quarter while its gross margins rose to 22.4%.
The company’s business is benefiting from increased AI spending by large companies like Microsoft and Google. The challenge, however, is that competition in the storage industry is rising, which could affect its growth. Its inventories have also risen, which could hurt its profitability if the revenue slows.
Review date: 08 October
Hype change: 89%
Price change: 7.85%
Sentiment: POSITIVE
CME Group | CME
Background
CME Group is a financial services juggernaut that offers services like futures, cash, and options in the US and other countries. It competes with other large companies like Cboe Markets and ICE, the parent company of the NYSE.
CME Group’s business has done well in the past few years as trading volume has jumped. It is also often seen as an all-weather company that does well in all market conditions.
For example, its business boomed during the Covid-19 pandemic and during the Global Financial Crisis.
Summary
CME Group stock has risen by over 20% from its lowest point this year as its business has continued doing well. Analysts expect that its business will continue doing well as the Federal Reserve slashes interest rates.
The company has higher margins, and its revenue growth is continuing. Its quarterly revenue rose to $1.5 billion and it boosted its forward guidance. It is also a popular dividend company with a yield of 4.51%.
Review date: 18th September
Hype change: 96%
Price change: 4.63%
Sentiment: POSITIVE
Accenture | ACN
Background
Accenture is the biggest IT consulting company in the world. It does the hard work for the biggest companies globally like Google, Unilever, Walmart, BP, Procter & Gamble, and Siemens.
For example, if a company like Walmart wants to upgrade its IT system, it will turn to Accenture, which will implement the project.
Accenture has capabilities in industries like cybersecurity, cloud computing, and artificial intelligence. Its growth is usually impacted by overall IT spending and new technologies. Gartner expects that IT spending will continue growing this year.
Summary
Accenture’s stock has done well after the company published strong financial results. Its revenue rose gradually to over $16 billion, while its net income margin rose to 11.2%.
Analysts are also optimistic about the company’s business as more companies continue investing in AI and cloud computing.
Review date: 10th October
Hype change: 105%
Price change: 3.3%
Sentiment: POSITIVE
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