Breakfast News: Markets Move Up And Right
December 3, 2024
| S&P 500 6,047 (+0.24%) |
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| Nasdaq 19,404 (+0.97%) |
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| Dow 44,782 (-0.29%) |
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| Bitcoin $95,385 (-2.56%) |
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Source: Image created by Jester AI.
1. Ron Gross: Ride Out Any Corrections
With the S&P 500 closing at another record high, fund manager and Financial Times columnist Ruchir Sharma claims overseas investment is leading to "the mother of all bubbles" in U.S. stocks. Compared to 30% in the 80s, the country is now attracting nearly 70% of capital globally for private investments in stocks, "far greater than its 27% share of the global economy."
- "That's not cheap": TMF's director of U.S. investing Ron Gross highlighted the S&P 500's 23x forward P/E multiple on last week's Motley Fool Money radio show. "We will, mark my words, get a correction. We just don't know when... The stock market always comes back and always goes higher. It has 100% of the time." All 28 corrections over the past 50 years have been more than completely erased by a subsequent bull market rally.
- Relative performance comparison: Despite U.S. stocks being the most expensive relative to European peers for several decades, the consensus is that this is backed up by the earnings power of strong American companies. Whether it's months or years before the next correction, remember: Stay invested, and take advantage of market volatility by looking for buying opportunities in quality businesses.
2. C-Suite Changes
Intel (INTC -0.65%) CEO Pat Gelsinger announced a surprise retirement yesterday, with two company execs made interim co-CEOs while a replacement is being found. Gelsinger was previously opposed to potential deal options, so this could open up options for breaking up or selling off parts of the company.
- CFO departs on results day: Zscaler (ZS 1.84%) beat expectations on quarterly results yesterday, but investors had to digest the news CFO Remo Canessa would be retiring. Fortunately, he will stay on to ensure an orderly transition for the new hire.
- Up 288% since going public in 2019: IPO Trailblazers recommendation TransMedics (TMDX -7.78%) announced Gerardo Hernandez would be joining as the new CFO. Hernandez was previously a finance VP at Alnylam Pharmaceuticals (ALNY 1.95%).
3. What to Watch on Tuesday
Beating the market by 25% since its first Stock Advisor rec, Okta (OKTA 0.95%) will release earnings after the market closes. Investors are expecting another record period for revenue, with the forecast of $649.6 million being 11.2% higher than last year.
- A semiconductor favorite: Marvell Technology (MRVL 1.72%) is expected to report revenue of $1.46 billion and adjusted earnings per share of $0.41 following the closing bell. Investors will be keen to note the results after a mixed bag for the sector so far in earnings season.
- Subscription sales key: Pure Storage (PSTG 2.11%) will be hoping to build on strong Q2 results later today, with analysts expecting a 7.3% growth in revenue but a 16% fall in earnings year over year.
4. SpaceX Valuation Rockets Higher
According to a Bloomberg report, SpaceX is in talks to sell shares privately in a deal that would pin a $350 billion valuation on the company – $8.5 billion more than Costco's (COST 0.65%) current market cap.
- A growth sector for the future: If executed, the deal would double SpaceX's worth from just one year back, highlighting the sharp growth in interest in space travel as well as the progress the company has made with recent Starship test flights.
- Tesla rally fuels gains: Founder and CEO Elon Musk would see another bump higher in his personal net worth, which stood at $353 billion to start the week after Tesla (TSLA 0.15%) stock enjoyed a 38% rally in November.
5. Foolish Fun
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