Hey Gotraders,
Happy Monday! It’s going to be another busy week as Alibaba (BABA), Lyft (LYFT), Hyatt (H), Activision (ATVI), Sony (SONY), DropBox (DBX), Beyond Meat (BYND), Vimeo (VMEO), Virgin Galactic (SPCE), and many more companies are set to report earnings this week. Refer to the earnings calendar below!
Let’s kick off the week by looking at Square’s (SQ) latest announcement. They plan to buy Australia’s Afterpay fintech company for $29 billion in an all-stock deal, which is expected to close in the first quarter of 2022.
What is Afterpay? Afterpay is a buy now, pay later company. Afterpay allows its customers to pay in four interest-free installments and pay a fee if they miss an automated payment.
“Square and Afterpay have a shared purpose. We built our business to make the financial system more fair, accessible, and inclusive, and Afterpay has built a trusted brand aligned with those principles.” - Jack Dorsey, Square’s CEO.
Once the deal is completed, Afterpay’s 16 million customers will be able to manage their installment payments directly through Square’s Cash App, which currently has 40 million active transacting customers. Impressive!
Why is this important? This deal is definitely good news for both Square and Afterpay, but not good news for the other competitors in this space such as Affirm (AFRM). There are several other companies that offer customers the option to finance their purchases in smaller, monthly payments such as PayPal (PYPL), Mastercard (MA), American Express (AMEX), Citi (C) and J.P. Morgan Chase (JPM). Apple (AAPL) is also planning to launch installment lending in a partnership with Goldman Sachs (GS). Looks like the loan installment space is getting a teeny weeny bit crowded!
📉 Pinterest closed 18% lower ⏬
Shares of Pinterest (PINS) closed over 18% lower on Friday after the company reported second-quarter earnings. They reported 454 million monthly active users, a 5% decline from the 478 million reported in May. Analysts were expecting them to increase its monthly active users to 482 million. Oops!
Shares closed at $58.90 on Friday, down 18.24% for the day.
📈 General Electric’s reverse stock split 🤔
General Electric (GE) completed a 1-for-8 reverse stock split on Friday.
What exactly is a reverse stock split? A reverse stock split is a type of corporate action that consolidates the number of existing shares of stock into fewer, proportionally more valuable, shares. A reverse stock split is essentially the “merging” of shares. It is the opposite of a stock split, where a share is divided into multiple parts.
General Electric ended trading on Friday at $12.95 per share. However, it will open for trading today at about $104 a share. So don’t be surprised when you see General Electric’s share price jump by over $90 a share!
Top movers & shakers 🎢
What else is making headline news 📰
HSBC’s (HSBC) reported pre-tax profit more than doubles to $10.8 billion in the first half of 2021.
Nio (NIO) delivered fewer cars than Xpeng (XPEV) and Li Auto (LI) did in July.
Google (GOOG) founders have sold $1 billion in stock since May, the most since 2017.
Popular companies releasing earnings this week 💰
Tuesday: DuPont (DD), Lyft (LYFT), Marriott (MAR), Hyatt (H), British Petroleum (BP), Alibaba (BABA), Phillips 66 (PSX), Prudential Financial (PRU), ConocoPhillips (COP), Lilly (LLY), Clorox (CLX), Activision (ATVI), Under Armour (UAA), Akamai Technologies (AKAM)
Wednesday: Mercadolibre (MELI), BioNano (BNGO), Wynn Resorts (WYNN), ADT (ADT), Royal Caribbean (RCL), Sony (SONY), Lemonade (LMND), HubSpot (HUBS), Roku (ROKU), Western Union (WU), CVS Health (CVS), Fox (FOX), Manulife (MFC), Booking.com (BKNG), Etsy (ETSY), Uber (UBER), Western Digital (WDC), KraftHeinz (KHC), General Motors (GM), Electronic Arts (EA), Fastly (FSLY), 10X Genomics (TXG), GoDaddy (GDDY)
Thursday: Monster (MNST), Provention Bio (PRVB), Expedia (EXPE), Beyond Meat (BYND), Zillow Group (ZG), Motorola (MSI), DropBox (DBX), Datadog (DDOG), American International Group (AIG), TuSimple (TSP), GoPro (GPRO), Moderna (MRNA), Appian (APPN), Virgin Galactic (SPCE), Fiverr (FVRR), Illumina (ILMN), TripAdvisor (TRIP), Vimeo (VMEO), Square (SQ), Cloudflare (NET), DigitalOcean (DOCN), ViacomCBS (VIAC), Novavax (NVAX), Zynga (ZNGA), Kellogg's (K)
Friday: Norwegian Cruise (NCLH), Cronos Group (CRON), Canopy Growth (CGC), DraftKings (DKNG)
A company’s market value may fluctuate considerably around the time that the earnings report is expected to be published. Stock prices may rise or fall according to analysts' speculative estimates, released prior to the actual earnings announcement.
The earnings season can be a time of great opportunity since better-than-expected figures could cause a company’s stock to greatly increase in value. Worse-than-expected results could have the opposite effect.
That’s all from us for now.
Signing out,
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The legal stuff 🤓
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