Dead on Arrival
Attention short sellers: Your Lyft has arrived.
Lyft Inc. (NASDAQ:LYFT) has traded on the Nasdaq for less than two weeks — but the situation is already starting to look bleak. Shares cratered more than 10% Wednesday as early speculators headed for the exits. After briefly hitting highs near $90 on its first trading day, Lyft is now threatening to break below $60.
Despite the early fanfare surrounding this oversubscribed offering, it’s safe to say the Lyft IPO is dead on arrival.
Are the dominos starting to fall for the unicorns waiting in the wings?
Uber Technologies Inc. is certainly preparing for the worst. The other ride-sharing, food-delivering app is set to hit the market next month. But underwriters are already trying to play it cool considering the recent Lyft drama. Uber underwriters are now seeking a valuation of $100 billion, according to the Wall Street Journal, about $20 billion less than Morgan Stanley and Goldman Sachs were pitching last year.
The company joins Pinterest as the latest tech unicorn to drop its valuation just ahead of its IPO. Pinterest is scheduled to debut on the New York Stock exchange early next week. That could be good news for the Uber folks, who will get to watch how investors respond to another high-profile offering from the sidelines.
“The circumstances remain nearly ideal for a strong IPO market, with stock prices broadly elevated and volatility low,” the WSJ notes. “Another key factor: Shares of companies that have gone public in recent years have by and large performed well as investors clamor for a piece of big tech companies with strong growth prospects. But IPO markets are fragile, and momentum can quickly fade.”
But hey, Uber only lost a cool $3.3 billion last year. What’s not to love?
Next up in tech news: Robots might eventually take over the world, but for now they’re going to mop our floors.
WalMart Inc. (NYSE:WMT) is about to deploy several hundred robot workers — which the company is calling smart assistants” in a few test stores this year, reports the Wall Street Journal.
“By next February, it expects to have autonomous floor scrubbers in 1,860 of its more than 4,700 US stores,” CNN reports. “Walmart will also have robots that scan shelf inventory at 350 stores. And there will be bots at 1,700 stores that automatically scan boxes as they come off delivery trucks and sort them by department onto conveyer belts.”
Don’t worry, these robots aren’t looking for Sarah Conner. They’re essentially glorified Roombas and sorting machines. Walmart’s not the only game in town, either. Several grocery stores around the country have already started testing robotic helpers.
While locations across the country are raising minimum wage, WalMart says the move towards automation will save them money and allow custodians and shelf stockers to focus on other jobs, mainly interacting with customers.
Shareholders are already excited about their new robot overlords. Walmart stock is bouncing toward its March highs and appears primed for a new breakout move.
Finally, solar stocks are basking in the warm spring weather this week.
The Invesco Solar ETF (NYSE:TAN) is powering back toward its March highs this week following a brief trip back to support late last month.
It’s no secret that investors slammed solar stocks in 2018. In fact, TAN dropped a disastrous 30% in just five months to new 52-week lows — and that was before the fourth-quarter meltdown even began. But solar has quickly become one of our favorite comeback sectors this year. TAN has gained an astounding 34% year-to-date, while some individual solar names look even stronger.
As the sector rebounds, your First Solar Inc. (NASDAQ:FSLR) trade continues to lead the pack. The stock just caught an analyst upgrade yesterday, sending shares higher by more than 8%.
Remember, we jumped onboard this play right as FSLR missed analyst expectation and cut its 2019 gross margin forecast. But the stock rallied on the bad news, and continues to trend higher. Yesterday’s big jump puts your open gains between 13%-15%, with no signs of slowing down just yet.