Hottest Stocks in CW 18/24

The Q1 figures presented by Google's parent company Alphabet last Thursday were greeted with enthusiasm on the stock market. At their peak, Alphabet stocks climbed by over 11% towards the end of the week. The Group's turnover rose by 15% in the first three months of the current year, while earnings before interest and taxes grew by as much as 46%. As a result, the EBIT margin increased significantly from around 25% to 32%. Earnings per share rose from $1.17 to $1.89, clearly exceeding market expectations (consensus: $1.50). There was particularly strong profit growth of 371% in the key cloud segment. Hopes have also been lifted by statements from the Executive Board, which believes Alphabet is well positioned for the next wave of AI innovation. For the first time in the company's history, Alphabet has announced the payment of a dividend in addition to further stock buybacks, with $0.20 per share to be handed out to shareholders each quarter.

Most analysts are enthusiastic and are adjusting their forecasts in line with the new figures. There is also considerable excitement among the many wikifolio traders who have this stock in their portfolios. The stock is currently held in 9% of all portfolios. This includes the wikifolio  Investmentideen, which has been managed by Thomas Schreyer (tomtomstocks) for almost exactly ten years. The portfolio, which consists of a total of eight individual stocks and has only ever been modified slightly, has achieved an overall performance of 1,020%. This corresponds to an average annual increase of over 27%.

Last Thursday, we saw Meta Platforms' share price fall by almost 16% following the presentation of the company's figures for the first quarter of 2024 on the previous evening. The revenue and profit results were actually stronger than anticipated. The social media giant earned $4.71 per share, compared to the previous year's profit of $2.20 and a forecast of just $4.32. The profit-taking was probably triggered on the one hand by the forecast for the current quarter. The operator of Facebook, Instagram and WhatsApp is forecasting a revenue of between 36.5 billion and 39 billion dollars. This puts Meta Platforms in the middle of this range, below the analyst consensus of 38.25 billion dollars. On the other hand, many investors are concerned about CEO Mark Zuckerberg's possibly overly optimistic expectations regarding the future of Metaverse. This is precisely one reason why the company has extended its current investment targets for AI research and data centers to up to $40 billion. Previously, the top limit was set at $37 billion.

Most active wikifolio traders have taken the share price losses as an opportunity to buy into the stock or add to their positions. A look at the trading sentiment shows the clear buyer overhang for Meta Platforms, which has in fact increased again in the past seven days compared to the previous weeks:

Trading-Sentiment:

For once, the performance of Varta stock has been very positive over the past few days. The stock gained almost 14 % over the course of the week. Previously, however, the share price had fallen by a third since mid-November, with a loss of over 95% compared to its all-time high just over three years ago. The former German beacon of hope in the battery segment is in the midst of a crisis and, according to market analysts, may even be fighting for survival. The Management Board recently had to admit that the current strategy and the planned restructuring measures are not sufficient in view of the company's economic situation to return to profitable growth by the end of the restructuring period. Further capital injections or other financing measures may now be required.

Varta is suffering from a slump in demand and competition from Asia, which is squeezing margins. In addition to this, there was also a cyber-attack. The insider selling by the CEO following the above-mentioned announcement is also causing scepticism on the stock markets. Some traders have therefore used the price rally of the past few days to sell the share. The current trading sentiment for Varta shows a clear selling overhang in the past week:

Trading-Sentiment:

The Chinese economy has not yet resumed its dynamic growth trend of recent years. This is also reflected in the quarterly figures and outlooks of many European companies. The world's largest manufacturer of lighting fixtures, Signify, for example, justified its lower-than-expected profit for the first quarter with the persistently weak demand in China. In addition, there was a significant decline in the European market for lighting professionals, which the Management Board considers to be a fundamental issue in view of the economic pressure in countries such as Germany. With sales down by 12.5%, adjusted earnings before interest, taxes, depreciation and amortization (EBITA) fell disproportionately by 18.3%. At €122 million, the consensus estimate of €131 million was clearly missed.

Although the outlook for the full year (adjusted EBITA of between 10.5% and 11.5%) was confirmed, analysts are not very optimistic. The analysts at JPMorgan do not yet see any signs of the company, which separated from the Philips Group in 2016, bottoming out, as the cost saving measures that have been implemented have not yet had a positive impact on earnings. Signify was already in the headlines at the beginning of April because the then CFO wanted to "devote himself to other interests" and therefore resigned. Following the publication of these figures, its share price fell by double-digits, motivating some wikifolio traders to sell their stock.

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