Reddit Stocks: What meme stocks are trending today? – July 31, 2023

US futures cautiously rise

• Dow Jones Industrial Average is up 0.1%
• S&P 500 is up 0.1%
• Nasdaq 100 is flat

US markets are growing increasingly confident that we are approaching the end of the current rate-hike cycle and that a soft landing can be delivered following last week’s data that showed the Fed’s preferred measure of inflation fell to its lowest level since the start of the pandemic. Plus, we are also halfway through earnings season and corporate America has so far performed much better than feared considering the majority have beaten expectations.

However, the future path of interest rates and the outlook for earnings both remain at the behest of macroeconomic conditions and data will remain key. That may be stirring a cautious mood this morning as markets await key jobs data and reports from behemoths including Apple, Amazon and AMD later this week.

You can find out what to expect on the macro side in our Week Ahead and prepare for another busy week of results in Earnings for the Week Ahead.

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. SoFi
2. Apple
3. C3.ai
4. Advanced Micro Devices
5. NVIDIA
6. NIO
7. Tesla
8. Palantir
9. Robinhood
10. Amazon

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. SoFi
2. Palantir
3. IonQ
4. Nikola
5. Lucid Group
6. Apellis Pharmaceuticals
7. Rivian
8. SoundHound AI
9. Tesla
10. Ford

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

Apple is up 0.1% and testing fresh all-time highs this morning at $196.10 after Piper Sandler raised its price target on the iPhone maker to $220 from $180 this morning. That comes ahead of the company’s third-quarter results out this Thursday, when Wall Street believes Apple will report a 1.7% year-on-year fall in sales and deliver a tepid 0.3% increase in EPS. Demand for devices is still falling but Wedbush analyst and long-time Apple-bull Daniel Ives has said it should at least meet expectations thanks to strong demand for the iPhone 14, despite the fact that the new iPhone 15 is expected to be launched within months. ‘We would expect relatively conservative September guidance as this is all about the drumroll to the main event with the anniversary iPhone 15 launch slated for mid-September timeframe,’ Ives said.

Amazon is up 0.9% at $133.45 after Credit Suisse increased its target price on the stock to $176 from $142 this morning. It too is scheduled to release quarterly results on Thursday, when markets forecast we will see a 8.5% year-on-year rise in revenue and a huge improvement in profits as comparatives become easier. The main focus will be on Amazon Web Services, which generates the bulk of profits. Cloud revenue is expected to grow 10% from last year to $21.7 billion, marking the sixth consecutive quarter of slower growth as businesses scale-back their IT spending, with markets not expecting this to start growing again until late 2023. There are hopes that Amazon can counter softer enterprise spending with new AI demand, although this may take time. However, markets will also be looking at how its ecommerce business is performing as they focus on how the US and global economy is faring and how consumer spending is faring.

SoFi is up 1.1% this morning. The financial services firm said revenue was up 37% year-on-year in the second quarter to $498 million, marking its ninth consecutive quarter of record sales. It also delivered its fourth straight session of positive adjusted Ebitda of $76.8 million, up from the $20.3 million seen the year before. Its net loss at the bottom-line narrowed to $47.5 million from $95.8 million. SoFi raised its outlook for the full year and is now aiming for annual adjusted Ebitda of $333 million to $343 million, marking a significant jump from its previous target range of $268 million to $288 million.

Advanced Micro Devices is up 1.3% at $114.45 after Susquehanna trimmed its view on the chipmaker to $135 from $145. The semiconductor stock reports earnings on Tuesday, when it is expected to report an 18.8% fall in revenue to $5.3 billion to mark the second consecutive quarter of lower sales. Weak demand for gaming and other hardware remains the key problem but markets are hopeful we could see a recovery toward the end of this year and into 2024. The bigger concern may be a slip in datacentre chips, which is expected to see a rare slip in sales of 5.8% this quarter. Adjusted EPS at the bottom-line is set to fall for a fourth consecutive quarter, this time by 45% to $0.57. However, earnings should return to growth in the second half as comparatives normalise. NVIDIA has stolen all the headlines as the eruption of AI grabs the imagination of the markets in 2023, leaving AMD and others in the dust. However, AI is too large a breakthrough to be monopolised by just one business and eyes are on how the rest of semiconductor space can catch-up. Commentary around AI will be key given the rest of AMD’s business remains under pressure.

Rival semiconductor firm NVIDIA, which will be among the last to report when it releases results in late August, is down 0.1% this morning.

Palantir is up 6.3% and at 19-month highs! The stock popped on Friday after Wedbush initiated coverage on the company with an Outperform rating as it predicted Palantir will become a ‘major player in the AI revolution over the next decade’, and that optimism appears to have built over the weekend.

Tesla is up 0.5% before the bell. The electric carmaker is thought to have cut prices on some Model 3s and Model Ys in Hong Kong, according to the Hong Kong Economic Times, as it continues to make its cars more affordable in an effort to keep demand buoyant. The latest price cuts will be between 6% to 11.9% and are expected to come into force at the end of this week on August 4

Chinese electric vehicle maker NIO is up 6.4% at $15.67, marking a 10-month high, after UBS raised its target price to $15 from $13 while maintaining its Neutral rating. The increase has been made to reflect improving risk appetite among investors, although the broker warned competition remains fierce and that investors may have to be patient before they see NIO deliver efficiency improvements to reach breakeven.

Ford is down 1.2% today at $13.10, marking its lowest level in over seven weeks, after being downgraded to Hold by Jefferies in wake of its latest results that showed its electric vehicle arm booked larger losses than hoped. The broker also said Ford’s decision to slow the pace of its EV ramp-up to protect profitability may be sensible but also a setback. It cut its price target to $15 from $17 and said rival Stellantis offers the best trade-off between value and returns.

Robinhood is up 0.8% before the bell today ahead of quarterly results out on Wednesday. The trading platform is forecast to report a 48% year-on-year jump in revenue to $472 million and adjusted Ebitda is expected to come in at $132 million compared to an $80 million loss the year before. Its net loss at the bottom-line is predicted to come in at $0.02 per share. The topline increase will be solely driven by the boost from higher interest rates, with transaction revenue estimated to be down 6.7% - driven by a 46% collapse in cryptocurrency trading. Consensus numbers for the second half are improving as comparatives are ironed-out, although user numbers and engagement continue to fall and investors are still waiting for signs of a recovery. Cost-cutting efforts and inflows of deposits in May provide some hope that the outlook is improving.

Coinbase is up 0.3% before markets open today. The US Securities & Exchange Commission asked the platform to stop trading in everything apart from bitcoin before it sued the company back in June, according to the Financial Times. ‘We really didn’t have a choice at that point. Delisting every asset other than bitcoin, which by the way is not what the law says, would have essentially meant the end of the crypto industry in the US,’ Coinbase CEO Brian Armstrong told the paper. The SEC has alleged that Coinbase has been operating illegally because it failed to register as an exchange and that it deals in instruments that it classes as securities. The SEC said it did not make any formal requests for companies to delist crypto assets.

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