Weekly Commentary - December 24, 2023

Hello and happy holidays,

While the current year folds, hopefully all of you are doing fine and enjoying our commentary which brings updates on Stock Market and potential investment opportunities for the near future:

Weekly Wrap up:

The Stock Market rally showed its resilience and continued to inch forward. Although there was a sudden drop on Wednesday afternoon but with market at its historically highest levels, profit taking is always expected generating temporary blips like these. Good part is that market recovered almost all losses incurred on Wednesday. Dow Jones Industrial scored another all-time high and ended the week with a +0.22 % gain. S&P 500 gained by 0.17% on Friday and +0.75% for the week. Nasdaq Composite gained +1.21% for the week while the Tech heavy Nasdaq 100 gained +0.95% for the week.

The strongest show was made however by small stocks. Russell 2000 ETF (IWM) rose by 2.63% and hence led the pack. Both Nasdaq Composite and Russell 2000 gains reinforced over conviction that market breadth has improved and the rally is not limited just to seven magnificent stocks as was the case for the most of the year.

With Christmas holidays behind us (typically this is a light trading week as many traders go on vacation), we expect the market to continue its recent surge amid Seasonality tale winds and optimism behind holidays shopping. Nevertheless, investors need to be nimble and careful in increasing their exposure to market as short-term profit-taking could kick in any time at these high levels just like we saw one on Wednesday afternoon.

Performance of recently mentioned stocks:

Performance of some of the stocks mentioned during our recent commentaries is as follows:

Stock 1 Week perf 1 Month Perf 3 Months Perf

MSFT 1.03% -0.87% 18.16%

NVO 5.47% -0.52% 12.51%

NVDA -0.12% 0.23% 17.35%

TW 3.37% -4.11% 11.52%

TNK 8.36% +4.92% 35.13%

META 5.23% 3.48% 18.16%

GE 2.73% 5.93% 13.88%

ROST 1.82% 4.15% 22.17%

COST 1.90% 14.01% 20.23%

REVG -1.31% 23.05% 18.13%

DT 1.37% 6.64% 18.67%

CVX 1.12% 4.65% -9.17%

AAPL -2.01% 1.20% 10.76%

NVDA -0.12% 0.23% 17.35%

MSFT 1.03% -0.87% 18.16%

REVG -1.31% 23.05% 18.13%

AMZN 2.30% 4.57% 18.82%

DDOG -0.09% 9.24% 38%

NET -0.86% 14.44% 45.98%

As shown in the above table, almost all the stocks mentioned during last 2-3 months have performed very well in line with our expectations. One noticeable laggard is Chevron but with its recent consolidation and a long-term leadership position in Integrated Oil Majors, we expect it to be a long-term performer with good dividend yield.

AAPL:

Apple is currently the only company with over 3.0 Trillion USD market cap. It added more than $1 trillion to its market value in 2023 alone (largest calendar year gain history), but market demands continuous growth from its businesses to justify this high valuation. Next year growth expectations are less than other key technology leaders like Microsoft, Google, Amazon and Nvidia. Nevertheless, it is a long-term leader and is expected to break the $200 barrier soon.

MSFT:

Even after recent performance, Microsoft is expected to continue its ride on AI and Cyber Security fronts. It is challenging Apple as the most valuable company and remains a favorite among many top mutual fund managers. Still in the actionable range and regarded as another long-term leader.

Actionable Stocks:

GOOGL:

We expect the internet and communication giant to deliver a sound 2024 and is actionable at its current price levels. It is expected to beat Apple in growing revenues and is trying to catch up with Microsoft in AI space.

ABBV:

If you are looking for a strong income generator in Bio-Techs then AbbVie with its strong dividend yield (3.82% annual) and a strong pipeline of products then AbbVie provides a good entry at current prices after last one year dismal performance. Although, AbbVie has lost its patents protection on its flagship product "Humira" which earned over 125 Billion USD since 2016 but other products in pipeline are expected to continue its revenue growth. After a consolidation, stocks seem to be actionable at current prices.

RAMP:

Want to play with some risk? Liveramp Holdings operates as a marketing technology company and provides data foundation, digital transformation and online marketing and analysis services. The revenue estimate of $165.37 million for the third quarter (ending December 2023) reflects a 4.3% rise year-over-year. The EPS estimate of $0.35 for the same quarter indicates a 25.3% increase year-over-year. Although its stock rose by 54.1% over last year but its growth strategy makes it a suitable candidate to continue its trajectory.

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Disclaimer:

The information provided here is for educational / learning purposes only and should not be taken as purchase or sell recommendations. Trading / Investing in Stocks and derivatives is highly risky and could result in a substantial or complete loss of invested capital.

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