Reddit Stocks: What meme stocks are trending today? – July 14, 2023

US futures

• Dow Jones Industrial Average is up 0.4% and at a six-month high.
• S&P 500 is up 0.1% and at a 15-month high.
• Nasdaq 100 is up 0.1% and at its highest level since early 2022.

US futures are pushing higher this morning after an impressive start to the second quarter earnings season, with major banks beating expectations and praising the strength of the US economy as markets become more hopeful that inflation is easing, interest rates are nearing their peak and that a severe recession can be avoided.

Most discussed Reddit stocks

Below is a list of the top 10 most mentioned US stocks on the WallStreetBets thread on Reddit over the last 24 hours, according to data from Quiver Quantitative. Exchange-Traded Funds (ETFs) and other instruments have been excluded:

1. NVIDIA
2. Coinbase
3. Delta Air Lines
4. Rivian
5. JPMorgan
6. C3.ai
7. Carvana
8. Tesla
9. Robinhood
10. Nikola

Most active US stocks before the bell

Below are the most active stocks with a valuation of at least $500 million before the bell, based on trading data taken from Bloomberg:

1. Nikola
2. Lilium
3. MSP Recovery
4. Plug Power
5. Intuitive Machines
6. AT&T
7. Rivian
8. Tesla
9. Activision Blizzard
10. Coinbase

US premarket winners and losers

Here are the stocks worth at least $500 million experiencing the sharpest movements in premarket trade, according to data from Bloomberg:

Top US stocks to watch

JPMorgan is up 3% and at 17-month highs after reporting record net interest income in the second quarter, helping it smash expectations as adjusted EPS of $4.75 blew the $2.76 estimate out of the water. It also lifted its annual outlook for net interest income (excluding CIB markets) to $87 billion from the previous goal of $84 billion. Average loans were up 13% as consumers and businesses continue to borrow, but deposits declined 6%. Investment banking, which has been hit by a lack of dealmaking, listings and fundraisings, also surprised after revenue rose 11%. ‘The US economy continues to be resilient. Consumer balance sheets remain healthy, and consumers are spending, albeit a little more slowly,’ said CEO Jamie Dimon. He added that consumers are continuing to use up their cash buffers but that job growth remains strong even if it has softened recently. Still, JPMorgan booked $2.9 billion of provisions that are set aside for potentially bad loans, which was higher than the $2.6 billion forecast to show it is still concerned about the economic outlook. The results included a $2.7 billion gain from the purchase of assets of the now collapsed First Republic.

Wells Fargo is up 3% and at four-month highs after it too raised its outlook for this year as it remains one of the biggest beneficiaries of higher interest rates, helping lift net interest income by 29% year-on-year in the second quarter. It said it is now anticipating this to rise 14% over the full year, having previously aimed for 10% growth. It echoed the sentiment at JPMorgan and said the US economy ‘continues to perform better than many had expected’. Still, it too booked more provisions than anticipated. Adjusted EPS of $1.25 in the second quarter was ahead of the $1.20 forecast. Average loans were up over 2% while deposits declined 6.8%.

Citigroup, which also reports today, is up 2% before the bell and at a one-month high.

BlackRock is down 1.1% and falling from a five-month high. The world’s largest asset manager reported adjusted EPS of $9.28 in the second quarter, rising from $7.36 the year before and coming in ahead of the $8.45 forecast. Assets under management grew to $9.4 trillion from $9.1 trillion three months ago, also coming in higher than the $9.36 trillion estimate. BlackRock saw $80.2 billion of net inflows in the quarter, but this was far less than the $86.7 billion pencilled-in by Wall Street.

UnitedHealth is up 3.4% and rebounding from 19-month lows after beating expectations in the latest quarter. The health insurer tumbled in the lead up to the results after warning that more older people were undergoing surgeries that were delayed during the pandemic, sparking fears that this would push up costs and erode profitability. However, those fears were overdone as UnitedHealth reported adjusted EPS of $6.14, coming in comfortably ahead of the $5.99 forecast. It also raised its outlook and said annual EPS should be in the range of $24.70 to $25.00, up from its previous range of $24.50 to $25.00.

AT&T is down 1.4% and testing 2023-lows at $14.91 after being downgraded to Neutral by JPMorgan in response to reports that it could be exposed to liabilities from toxic lead sheathing on US phone cable networks, with the price target lowered to $17 from $22.

NVIDIA is up 1.3% and at fresh all-time highs as it finds some new momentum. The chipmaker has found it more difficult to find higher ground over the past month but has found support this week from news it could become an anchor investor in chip design giant Arm ahead of its anticipated IPO later this year.

Microsoft is up 2.1% while Activision Blizzard is up 1.7%. The UK’s Competition & Markets Authority has extended its deadline to rule on their proposed combination to August 29 after receiving new proposals aimed at addressing the regulator’s concerns. The CMA was objecting to the deal but has since warmed to the idea since the US Federal Trade Commission was told by a judge that it had failed to convince them that the deal is bad for competition, although the FTC is now appealing that decision.

Tesla is down 0.2% this morning. The electric carmaker said that the $7,500 tax credit available in the US could be reduced in 2024, leading Evercore ISI to theorise that it may have made the announcement to help drive-up demand in the near-term. We also discovered today that Tesla has started shipping its cheapest car, the Model Y, in South Korea from its plant in China. It is priced at around $44,000, although reports said it can be as cheap as $30,000 in some areas where there are extra subsidies and incentives available. That is significant as only the dual-motor performance and long-range versions were available in the country beforehand and these cost considerably more.

Rivian is down 0.7% before the bell. The electric carmaker has risen to fresh 2023-highs this week after delivering more vehicles than anticipated in the second quarter and having its target price raised by brokers, but the rally has stalled and the RSI is in deep overbought territory. Automotive News reported today that the former boss of Porsche’s business in North America, Kjell Gruner, is set to join the board of Rivian.

Nikola is up 14.9% and at its highest level in five months after popping over 60% yesterday, when it unveiled a deal with BayoTech to develop a reliable hydrogen supply for commercial electric vehicles, including its own electric trucks. This will see BayoTech buy up to 50 of Nikola’s electric trucks over the next five years, while Nikola plans to buy hydrogen supplies from BayoTech starting in 2024. Still, Nikola is heavily-shorted despite the recent rally, with short interest standing at over 24.5% of its float, according to data from Fintel.

Delta Air Lines is up 0.4% after delivering record revenue and earnings in the latest quarter and raising its full year outlook when it reported yesterday, putting it on course to deliver record annual earnings this year. CEO Ed Bastian said domestic demand is resilient and that international travel is strong across the board. Citi said Delta’s valuation has not yet returned to pre-pandemic levels, providing more upside potential as it reiterated its Buy rating and $65 price target. Cowen said the airline is ‘firing on all cylinders’ while Raymond James said there is scope for its outlook to be lifted again later this year. The positive update this week is providing support to rivals ahead of more earnings due out this month, with American Airlines, United Airlines and Southwest Airlines up 0.3% to 0.5%.

Carvana is down 2.1% at $36.89 today. The used car retailer climbed to a 10-month high this week but took a tumble yesterday when JPMorgan downgraded it to Underweight, saying its valuation has once again become disconnected to its fundamentals after soaring higher in the wake of its well-received results in May and a lift to its outlook in June. It set a target price of just $10.

Coinbase is down 0.9% today after popping 25% yesterday, sending the cryptocurrency trading platform to its highest level in almost 14 months! The stock popped amid a broader rally across the space after a US judge ruled that XRP tokens sold by Ripple Labs are classed as a security when sold to institutional investors but not when they are sold to the general public. That also contributed to the gains in bitcoin yesterday, although we have seen some pullback today and that is placing some pressure across the sector today, with other crypto stocks like Marathon Digital and Riot Platforms both down 0.7% today.

Trading platform Robinhood also benefited from the rally in crypto stocks yesterday and is up 0.8% before the bell this morning, poised to open at its highest level in 15 months!

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