Home Depot – Algo Buy
HD:NYS is under Algo Engine buy conditions.
NASDAQ – Valuation Review
NASDAQ’s PE ratio is now 27X forward earnings with 2022 earnings growth rate forecast at 12.3%. The recent rally is a significant extension given the move higher in interest rates.
The graph below looks at the valuation of the S&P relative to US GDP.
S&P500 Chart Review
The S&P500 continues to trade higher following the recent Algo Engine buy signals. Short-term, the momentum indicators remain positive and the price action is above the 10-day average.
Take-Two Interactive: Algo Buy
Take-Two announced on Jan 10 that it would be buying Zynga for $12.7b. The current weakness in the share price provides for an attractive entry point.
Solana: Large Cap Crypto
Solana remains under buy conditions and any minor pullback will likely see increased buying activity above the recent $78 support level.
US Stock Market
The graph of the S&P500 shows faltering short-term momentum with overhead resistance at 4590 in the S&P500 index.
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12/2 update:
19/2 update: The S&P500 remains below the 10-day average.
12/3 Update: The S&P500 remains below the 10-day average.
Federal Reserve’s First Rate Increase
Markets may have little reaction if the central bank carries out its quarter-point hike on Wednesday.
The Fed’s rate hike is expected, but investors will be watching to see what the central bank has to say about inflation and the economy, as well as its projections for future interest rate hikes.
Danaher – 4Q Earnings
Danaher Corporation Common is under Algo Engine buy conditions.
4Q Dec 2021: net earnings were $1.8 billion, or $2.39 per diluted share which represents + 44% year over year. Non-GAAP earnings per share were $2.69 or + 29% y/y.
Revenues increased +20.5% year-over-year to $8.1 billion.
Full-year 2021: net earnings were $6.3 billion, or $8.50 per share which represents +74% year-over-year increase. Non-GAAP earnings per share for 2021 were $10.05, or +59 over the comparable 2020 amount. Revenues for the full year 2021 increased 32.0% to $29.5 billion.
Operating cash flow for the full year 2021 was $8.4 billion, representing a 34.5% increase year-over-year
Paypal – Earnings Review
Q4’21: Solid finish to another strong year
Total Payment Volume (TPV) of $339.5 billion, growing 23% on a spot and FX-neutral basis (FXN); net revenues of $6.9 billion, growing 13% on a spot and FXN basis.
FY’22: Expect TPV to reach $1.5 trillion and revenue to surpass $29 billion
• TPV is expected to grow 19%-22% at current spot rates.
• Revenue expected to grow 15%-17% on a spot basis; excluding eBay, revenue is expected to grow 19%-21%
• 15 to 20 million NNAs expected to be added to PayPal’s platform in FY’22.
We see long-term value in Paypal for the patient investor and anticipate that the company will make attractive bolt-on acquisitions, supported by low company debt and free cash flow, which will help support the growth story.
Short term, traders may wish to position a trade around the highlighted setup below, with a stop loss below the recent pivot low.
Medtronic – Buy
Medtronic plc. Ordinary is under Algo Engine buy conditions.
Medtronic sees rebound in elective procedures as Omicron surge wanes. Fourth-quarter profit was in line with Wall Street estimates.
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