BFLY - The Meta-Hurt With Special Guest Mike Saul!

Summary

• This week we're breaking down your stock requests from last week! Coca-Cola, Meta, Futu Holdings, and more.
• We also take a look at what has happened with Disney's stock price since episode 5.
• Today we're joined by the one and only Mike Saul, who runs our Monday webinars, What's Happening in the Stock Market.

Editors' Note: This is the transcript version of the show we recorded on Wednesday. Please note that due to time and audio constraints, transcription may not be perfect. We encourage you to listen to the show embedded above, if you need any clarification. Enjoy!

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Daniel Snyder: Hey everyone, welcome to Stock Market Live. Let's get those jams back going. There we go. Set a nice little lunch vibe for everybody joining us today. We are joined by the one, the only, the legendary Mike Saul, who runs the Monday webinars , What's Happening in the Stock Market. Austin is enjoying some time off this week.

So we've got Mike, I hope you guys enjoy him as much as I do. We have a full show planned for you guys. I mean, we're talking about the most amount of graphics we've ever brought to the show. We're doing technical analysis, we're diving into the fundamental analysis, the metrics on the six company stock ideas that you guys shared with us at the end of the show last week. So you guys put us the work, made us do our homework. I've got a full breakdown. I've got thoughts. Mike has thoughts. Mike, how are you doing, by the way?

Mike Saul: Doing great. Good news is the air conditioning repair man is coming back today. So if you guys see me flip out for 10 seconds. It's because I have to answer the phone and tell the guy that I'm here and ready for him. Otherwise I'm doing fantastic. I can't believe the summer is over. I'm sorry, I know that's a very cliche thing. I can't believe how fast the year is going but what they say is the older you get the faster it goes and yeah, it's true. So I tell everybody out there no matter how old you are, enjoy your time.

- Yeah, no kidding.

- 'Cause it goes by way too fast, anyway--

- Let's get some shout outs, oh look at all these people here today. We got Christian, we got LC, we got Godwin, we got Joe, we got Chris, we got Mark, we got Rollin, we got Sam, we got another Sam, we got Sammy, we got Sirgue, man, everybody joining us. Thank you so much for joining us today, here live on the Zoom, on the chat. Or if you're looking and watching us online, Facebook, YouTube, LinkedIn, we're across all social media channels. And we want to remind you that this is an engaging show. So jump into the comments, jump into the chat, leave your thoughts, leave your ideas, you're gonna get vibe, get your drinks, if you're already at that point in the day. It's five o'clock somewhere, right? Even though it's only noon on the East Coast.

But let's go ahead and dive into the show what we've got planned today. So I wanted to kick things off because we sometimes get questions about the technical analysis side of things and I like technical analysis but also like matching it with the fundamentals. So Josh, you're in the back there with us joining us again today as always, because Josh runs the behind the scenes of the show. Let's go ahead and throw up this first chart that we have and this is a throwback that I want to bring to everyone's attention.

Now just two weeks ago we were on this show and me and Austin Hankwitz was breaking down Disney ( DIS ) stock and also just full disclaimer all the stocks that we're talking about today I don't own any of them, I don't have any derivatives, I don't have anything like that, I'll let Mike share if he has anything in his portfolio on any of these stocks, but just so you know, this is just plain research and analysis bringing it to you.

So let's go back to this Disney chart real quick. Now if you were on two weeks ago with us, you remember I pointed out the gap below the price there and Josh go to the next chart. I told everybody 80% of the time gaps fill, there's still a huge gap above the mark but look at that, not only does the gap fill but the bottom of the gap actually produces a nice little support level that you see there. Josh next chart for me. That one was pulled yesterday, this one I just pulled today so I'm thinking about where are we going from here? I don't know but look there's two little gaps above the Disney stock price there and there's something I would keep an eye on, obviously you've got the 20 day moving average trying to level out, you got the 50 on the upswing, 100 may be trying to get a little up but it's still below the 200 day moving average. Something you wanna take note of there. Just wanted to bring that highlight that remember gaps they can be your friends if you know how to trade them. Alright, so let's dive in, shall we Mike?

- Real quick. I just wanna disclose that like kids do own Disney stock. I don't own anything like they do and not a lot. This isn't a stock that you pump and dump. It's not a penny stock or anything like that. I'm not running out looking to sell it. It's their grandfather, who is at least the second best grandfather in the world right next to my dad but it's my wife's dad bought all his grandchildren $1,000 worth of Disney stock when they were born. My oldest who is about to turn 17, His is worth almost 12,000 now, without any additional stuff right it's really awesome. And the older grandchildren were a couple years older, there's a worth even more but anyway so I'm not pumping and dumping Disney here.

- It's a powerhouse of a company in a stock, I mean the management has been ruthless ever since Eisenhower or sorry not Eisenhower.

- Close enough. But Eisen, right. It's good enough.

- We're taking it way back.

- I appreciate a company that does great marketing and Disney they know control the age demographic from the baby and the young toddler, is going to get the Disney is, all the way through Marvel, all the way to now with the Star Wars franchises, all the way to adults like, look, what do you do when you wanna know, hey, how are the Mets doing? I know you don't know what that word means 'cause you're down in Atlanta. But when normal people, how the Mets the Yankees doing, what do they turn on? They turn on ESPN, right? So they control the whole demographic from birth to death. I mean, that's amazing to me. Anyway, again, this isn't a let's buy Disney kind of thing. I'm not running in and rushing into by Disney here anyway, but I just did wanna disclose that my kids do own shares. And I'm not using this webinar as a chance to sell it into the rush of people.

- Not at all. I mean, I love that company.

- It create way too much volume. But anyway, sorry about that.

- So we wanna do, Brian, thanks for joining us on Facebook. I see you over here buy now we're continue to hold in cash. I'm guessing that you're asking about the overall market, which tees this up perfectly. Because Mike, I want you brought two charts here to start it off. Why don't we go ahead and get an overall look at what's going on with the Spy's in the Q's? Can you lead us through this. Josh, can we throw up that slide?

- Okay, so here is my S&P 500 chart. I'm using the Spy, but you can use whatever index you want. You can use a cash index, and you can use a different ETF. But Spy is the most heavily traded, the most volume. So let me just talk about what's going on here. I have two lines, they're called moving averages. The blue line is the 50 day and the black line is the 200 day moving average. Those are much watched moving averages. They're watched by institutions, they're watched by individual traders, they're watched by the media.

I always tell a quick story. I met John Murphy who wrote the book, "Technical Analysis of the Financial Markets," it was basically one of the most popular books of all time. And he used to tell me that when he went on CNBC, he used to get ribbed badly for charts. All charts don't work, charts this, charts that, ba, ba, ba, what are you doing looking at charts, and then serendipity or whatever the word is.

Amazingly, a week later, I'm watching CNBC and Joe Kernan, who was one of the biggest detractors of charts, not knocking him, I think he's a great anchor. I'm just saying it's not a big fan of charts. Said oh, look, AOL is approaching its 200 day moving average. And I'm like, really, so even if you hate technical analysis, you still know where the 200 day moving average is, anyway, it's a long term moving averages and what moving averages do is they smooth out the fluctuation of price. So rather than have to look at how jumpy price can be, especially when the markets volatile, people like to use moving averages to just get the overall trend, the 200 is the longer term trend. The 50 day moving average made extremely popular by Investor Business Daily, William O'Neal's publication is an intermediate term moving average. So you see here the S&P is below both of those moving averages. It got up to the 200 day moving average and rejected pretty--

- Top ticked it.

- It top ticked it, yeah, it ran right into it and pull back. Now, you can also see on my chart that I have this 50% number. What that means is from the low in June, up until the recent high, we are now about halfway back. And that's another level that people like to look at, again, you could argue as all you want about is it magic? Is it just luck, whatever it is, it doesn't matter. The point is, whether it's a self fulfilling prophecy or not, people are looking at these levels and the levels that people are looking at, we should be looking at them to, we should be looking at what happens at these levels, right? You don't have to sit there and go, I'm always barring the 50 day moving average. No, you don't have to say that. But I wanna know what happens when we get there.

Now below that we also have this line that I have sloping up, I'm pointing to it, like you can see my finger, which you can't, but we have this line that is sloping up that is around 390 but it's continuing to slope up, that if we continue down that could possibly be support. It is not a trendline now, Daniel, because it's only connecting two points currently. And you can connect any two points anywhere on a chart. So that's not technically a trendline. But it's we're just looking ahead, right. So my motto is prepare not predict. I'm just preparing what happens if we do get down to that level. Now the purple numbers just for people asking what are these purple numbers?

That is the equation the low in June which was $362 and 17 cent times 1.2, which is 20% above that would be $434 and 60 cents. Why am I looking at 20% off the lows? Well, the rule of thumb is a bear market begins when we are 20% off the highs but a bull market begins when we are 20% off the lows. Now again, that's up for debate. I don't think anybody should just use a straight 20% number either way, however, once again, I wanna watch what other people are watching. So if we get to 434 and 60 cents, some people will say, hey, we don't have a bear market anymore.

And we're in a new bull market. I'm not saying I'm gonna say that, but other people will. And I wanna see what happens. What happens if we get to that number? Do we just, does money come flying in, do we get money flows in, what's going on there. So it's definitely something to pay attention to them. That's what the purple number is.

- That's the Spy. So let's check out the Q's. Once you bring us on the Q's, what levels are we looking at?

- So on the [[QQQ]], which is the way I look at the NASDAQ 100. Next slide, Josh, if you can. So, the QQQ, which is the way I look at the NASDAQ 100. But again, you can use whatever you want. You could see, when I took this chart right now we're actually bouncing a little bit, we're at 301.43. When I snagged this chart, but we are also below the 50 day and the 200 day moving average. And we're also below that 50% mark. But notice that similar trendline that I had drawn on the S&P, which didn't hit it yet, the NASDAQ actually hit that line yesterday. So technically, this could be a trendline.

So far, it is holding as support. So that's what the charts say. And overall, what I am looking for now is I am looking for this short term support, whether it's the 50% back, whether it's the trendline, whether it's the 50, day moving average, which are all kind of bunched up here. I want to see if we can hold here and get a bounce. I'm not predicting that we're gonna bounce yet, but I'm preparing here. Okay, we looked at sentiment readings. If you look at sentiment readings, people are getting fearful and people are getting bearish again. I am a contrarian by nature, right. So when people lean one way, I like to look the other way. It's not a signal in and of itself.

It's not like Daniel's bearish, that means I have to go long. That's not how it works. You what you're doing is you're building up evidence to one way or the other. And to me, when more people are bearish than bullish, that's telling me well, most of the time the retail crowd are wrong. So what I'm gonna do is that's gonna go on the bullish side. Now I'm seeing a confluence of three different kinds of support. That's telling me, hmm, maybe I should start watching for a bounce here. So that's what I'm looking at in the overall market. I'd like to hear your opinion, oh, Daniel, of course.

- Yeah, good point. I mean, obviously, we could talk about the overall market all day. But I mean, if you've watched prior episodes, I'm a huge fan of Fibonacci and technical retracements. And watching some of these levels, 'cause as you mentioned, it might be a self fulfilling prophecy. But it might just be that there's tons of quantum machines trading based off of these principles, which might be why they are true, right. So that's why we always wanted to take a note of these technical levels and watching the trendlines and seeing if support holds, but like, as you mentioned, all we're doing is preparing for what comes next.

Now, let's get off of the overall market. Let's start diving in to the individual stock picks that were shared to us last week. I'm gonna go ahead and take over the screen real quick, Josh, pull up Futu Holdings Limited ( FUTU ) for everybody that hasn't heard of this company 'cause I briefly have heard of this one.

Here's a quick rundown for you. So Futu Holdings Limited is a mid cap international financial investment banking and brokerage company based in Hong Kong. We're talking trading, clearing, settlement services, wealth management, IPOs descriptions, and so much more. The company just announced their Q2 unaudited earnings the other day. What are we looking at? We're looking at 9.6% year over year growth on revenue of 222 million. We have earnings per diluted share of 57 cents, total number of paying clients is up 38.6% year over year, but the total client assets declined 13.8% year over year. But I mean with current global conditions probably makes sense. Total trading volume increased 2.4% year over year which is positive with the daily average revenue trade and Q2 increasing Q1 year over year.

Obviously you can see here if we go into the Seeking Alpha here actually to give it back to Josh. Josh let's go on throw put the ratings card that we have for Futu here. Obviously you see it on the screen right there, Seeking Alpha Authors have a hold on this stock, Wall Street analysts are a buy and the Quant rating is currently a hold. Let's go ahead and go to the next slide Josh. Will get the factor grades that Seeking Alpha provides on these. The one thing that sticks out to me obviously is the valuation, right. It's the only D here so why is this valuation a D, I mean the stock has been crushed over the last year, the stock is down over 50% is overvalued when compared to his peers in the financial sector. When it comes to metrics like price to sales or price to book. All those go within the valuation grade, hence the D grade here, but also the grade was a D three months ago. So it's not really seen any improvement quarter after quarter. You gotta trust the metrics.

Oh, this is the other point is, first of all, this is a Hong Kong company. So you're trusting the metrics, they're unaudited, you gotta keep that in mind as an investor investing outside of the US economy, they aren't necessarily held to the same GAAP principles, the non GAAP principles and the way that we report here. So you got to keep that in mind. It's worth noting the stock does not pay a dividend. And the management just said on their earnings call that they have no plan of starting a dividend anytime in the near future.

One notable thing about Futu that I noticed was that the short interest is all the way up to 12%. So 12% of the float is something worth recognizing. Obviously, it's been a meme stock. That's the simplest way to put it. That's why it's on everybody's radars. It was one of those stock names during the pandemic, that people were just Wall Street betting, they were on Twitter about it, they were trying to pump and dump it. And when we look at the charts here in a second, you'll know why.

So why did people like this stock? It's simple, the meme stock, it was trading around $10 when COVID hit, and it benefited with the tide raising all the boats, right. So beginning of 2021, the stock exploded from roughly $37 a share up to $191 a share. And personally, my take again, this is my opinion. I'm not a fan of international stocks. This isn't one that I would probably ever touch in my own opinion. I just like to focus on US equities. But I think investors here should worry about the valuation and the regulation crosshairs that are going on specifically with anything around China or Hong Kong companies.

Obviously, there's the Hong Kong and the China one and you see the news about Baba ( BABA ) and JD.com ( JD ) and all the others. I mean, just one by one, it seems like the news keeps coming out about the regulations. And what are we gonna do? Or we're gonna allow these companies to stay on US stock exchanges? Are we gonna audit them? How long is that process gonna take? There's a lot going on there. So that's something that you wanna keep in mind, especially not even mentioned, Taiwan and China, right?

There's a whole other macro global thing going on there. So let's go and go into the charts real quick, from my viewpoint. Josh, next slide. So I was looking at the technical analysis, obviously, I have my Fibonacci numbers drawn there. But also, this chart just looks horrible to me. I mean, all the gaps above the market as this stock is just tanked, right? I mean, makes total sense. The entire market tanked down to a bear market since the beginning of the year. That's what you're seeing here. Liquidity coming out of these high risk names. We know risk has been completely crushed. You're seeing some Fibonacci. I mean, it's just breaking through the levels, which you never really wanna see. But it does that. You see the different moving averages going on here. I think I did a... So this is a global view.

So let's go to the next slide, Josh. I zoomed in a little bit, 'cause it's like, okay, all that's great. We know that it's come down. Where do we go from here? There was a gap below the market that you see that just filled. I think that was last week. Again, you see the bottom of the gap, offering a little bit of support, we saw the rotation come back up, filled the gap above the market with that big old red candlestick right there, came back down, we're seeing a trading zone. That's pretty much my opinion on how this chart is looking right now, as you're seeing a trading zone, you're finding a base. I have no personal opinion on if you should buy or sell the stock, honestly. Like I said, I'm a US equity guy. But Mike, what is your opinion? I know you took a look at this chart as well. What do you think?

- Well, everything you said is spot on, I get very nervous with international stocks, especially stocks in China, because it seems like the rules of engagement change every week. One day, you'll see all China stocks are up because the Chinese government finally said, oh, they're gonna let the US put their criteria on or whatever, it doesn't matter. It's all blah, blah, blah, blah, blah, blah, right? 'Cause the next week, it's oh, China decided that they're not gonna let the US have anything to say about how we list our stuff. Again, for a longer term hold, I couldn't agree more. As far as the short term trade. Look, if you're day trading, I'm sure we have some day traders on all of us.

Yeah, that some days it could gain some momentum and there could be some intraday patterns the setup and maybe you could grab something but Josh, if you go to my chart, which should be next, you can see here I have, looks, it's just a different shot than what Daniel has, but basically the same thing, which is that gap up at 65.62. That's gonna be a pretty significant line in the sand since that gap was formed last November, and it's still below that for all this time. So it hadn't look like what it had what's known as a falling wedge. Those are those two converging lines. It broke out. It's above the 50 day and the 200 day moving average.

Here's another thing, right? Is it 20% off the lows? And what is that low in March? For some reason it's not let me see that. I don't know why, maybe it doesn't want me to... Maybe the Chinese government doesn't want me to talk bad about it.

- I think it's 21.21.

- Or whatever it is. So it's more than doubled from the lows on the year. So what did I say earlier that the rule of thumb is 20% off the lows as a new bull market. Does this look like it's in a bull market? Doesn't look like it's in a bull market to me. So that rule of thumb, like I said, it's one thing, but you have to look at other things. So to me, I agree with everything Daniel said, plus some, talk to me when it gets over 65.62. And even then there's even a gap above up around 80. So for a longer term view, I don't know. And it's tough to trust international stocks and Chinese stocks.

- Or meme stocks, 'cause this was meme stock.

- Also a meme stock, oh, absolutely. But for day trades, as long as you have your risk parameters on and you understand, and I'm not saying today, I'm just saying if the volatility kicks back up here, and you know how to tie your entries and you understand what your risk is, then maybe it could be one for your watch list. But otherwise, I don't see any reason to be looking at this.

- Yeah, agreed. So that was Futu Holdings, that was pitched to us from Walter last week on the Zoom chat. Thank you, Walter, for that stock. We're gonna go ahead and move on to the next one, which is Palantir ( PLTR ). And this one was given to us from Jorge on Zoom last week, I'm gonna go ahead and pull up the Seeking Alpha site. We're up. Getting a little ahead. There we go. That's all right. Palantir, wanna make sure you guys see this. PLTR, pull it up on the Seeking Alpha website.

So what is Palantir Technologies do? Palantir Technologies is a large cap IT company based out of Denver, Colorado, they make headlines with defense companies, since one of their largest clients is the United States government. They provide a few software platforms that are not only used in counterterrorism investigation and operations, but claimed to help people organize and realize patterns within their large data sets.

For instance, I thought this one was pretty interesting. They've helped identify a 200 billion US dollar Russian money laundering operation. And they assisted the FAA in minimizing air travel disruptions recently with all the pilot shortage and everything else going on. So they're a big data warehouse, help break down the data, analyze the data. They recently announced Q2 earnings on August 8, the good side was US business generated more than $1 billion in revenue and the trailing 12 months. The bad side is they miss consensus on revenue for the quarter. And they lowered year end consensus, which is never a good sign.

Let me get this back to you, Josh. Let's go through up the rating summary tab . Obviously, you see it there on the same page as well. So the Seeking Alpha Authors, Wall Street analysts, and the Quant rating system all have a hold on this stock. And let's go over to the factor grades. Factor grades show that there are a lot of D's here. Never a good sign to see, valuation, momentum, revisions. The forward PE for Palantir is 143 times, let that sit in a second. I mean, this stock is only priced around the $8 range. But you're talking about 143 PE for it. Come on, get out of here. In the last three months Palantir has had nine down revisions on both EPS and revenue revisions. Hence why the revisions is in D plus. And then also, just for the stock price. I mean, you're gonna see that momentum grade be a D as well.

The tricky thing for Palantir here is that they have a few big clients, one of them being the US government, as I mentioned. So if they were to lose one of their big clients, they're gonna lose a huge chunk of revenue, which is never a good sign as a business. Analysts, I think that's how you say the last name from RBC recently pointed out that the net new value of deals from the US government and Q2 was $25 million. What you're like is that good or bad? That is down 81% year over year, that is not good to see one of their biggest clients, not giving them the contracts that help keep them supported and alive, right. They want their Foundry products that they have to take over AWS, which kind of makes me laugh a little bit 'cause I'm thinking, okay, AWS is huge.

They started the entire website pull from the data service space, the margins are super impressive is extremely hard to get your data off of there. I hear people talking about Snowflake, it makes it easier. I don't know that much information about that or how it is or not. But honestly, my take is if people are leaving AWS, they're probably not going to Palantir, they're most likely going to somebody like Microsoft ( MSFT ) for the Azure cloud, because Microsoft can offer them so much more as a commercial client, where Palantir is very much I think focused on supporting there big clients like the US government and focusing on the secrecy of data and privacy and helping with special missions, et cetera.

And there's no dividend on this company, it's not even profitable yet. So let's get into the technical analysis I have for you. Go into the next slide, Josh. There are a few little gaps above the market. I would take note of that. I do look at that 618 Fibonacci retracement all the time, obviously, you see it broke through recently on the waterfall sell off, went up retested a level and could not get over. So that is something to make note of as well, you're back in this little balance zone, that goes back to looks like May is where they had that little balance zone.

So you might see it kind of hovered around here for a little bit. Long term, this company needs a lot of help. I think that's the easiest way to say it. And they need a lot of help. They need to be able to diversify to more commercial clients, as well as diversify their revenue stream, get their gross profit margins and really become a competitor. I mean, they're in a hard space with all the software in the data. So that was just my take. Mike, what do you got? Let's go to your chart and see what you got to say about it.

- Yeah, so let's be clear, right? The stock and the company are oftentimes different, right? They're not the same thing. So let's talk about the company first. They've never made money, and they've made statements that they never think they will make money. That on the company side of things. Yeah, well, it's nice that they're punching up at AWS. But like you said, there's a lot of hurdles to get through. How about the Google Clouds. Forget about Microsoft which is big enough, right? How about the Google Cloud?

How about on-premises, which there is a big trend to actually moving on-prem? Now, believe it or not, there was the big trend, everybody, let's get off-prem. Because what is the cloud, the cloud is just being on somebody else's server. That's all it's still physical. It's not, it doesn't exist in that just in the atmosphere. So people are moving back to on-premises, believe it or not, so not only do you have to fight that, then you have to fight all the, I don't wanna call Microsoft, a second tier cloud provider, because they're not, the top tier ones, including AWS, which like you said, very tough, very tough to fight with them. And why would you? I read a stat once that AWS attempts to get hacked, I read a million times a day, I think something like that, they try to hack AWS.

So why would you give up that type of security, the fact that they can, for the most part, once in a while you'll see an outage, but very rare, right? Most of the time, they have the best security and the best list and now of a sudden they're gonna move to somebody else. I don't know about that. Let's talk about the chart. The chart came out, that stock came out as a direct listing at $10. That's how it IPO $6 and 44 cents is the all time low on the stock from back in May. I think it's going there. That shot looks absolutely terrible, again, after it came off for $6 and 44 cents it went up to whatever, $11 whatever, it is that a fresh bull market, 'cause it's more than 20% off the lows, right? 20% off 6.44, what's that, doing math quick in my head would only be $7.35. And went much above that not a new bull market.

Look at the slope of the 200 day moving average, it's coming down very strongly. That's a sign that the long term trend is down on this. The stock looks terrible. I don't think that this is a stock that I am gonna wanna get in anytime soon. Could that be a catalyst?

The only catalyst I'm seeing Daniel, you make a great point. What if they lose one of their big customers. Look, a recession is either here or it's coming soon to a theater near you, right? The US government they spend, they don't care, they'll keep spending no matter what, right? So the fact that the US government is one of the clients is great, but what if somebody leaves? I mean, it's an incredibly valid point, then what happens?

So again, I don't like the stock and I apologize to any... I think to, don't take this personal whoever asked about this, and maybe you're in it from higher prices. Nobody's saying that you're dumb for being in it or anything like that. This is just two guys opinions here. And we're looking at the chart, that's all we're doing.

- And that's a take. That deserves an air horn. No, I mean, it's exactly what we wanna do, right? We're here to help provide a set of eyeballs, a set of analysts, a set of looking into the earnings, looking at the chart, just providing another opinion that maybe you're exactly on the same boat of as we are, and you're thinking, oh, this stock has dropped so far, maybe now's the time to get in. I'm not gonna get in here personally. But maybe it's just like, we wanna provide a viewpoint that can either agree with you, combat you and just have this dialogue in your head or to present this so that you have a dialogue with yourself whether this is the right stock for you. We just wanna help, that's why we're here.

So let's move on to the next stock. We want to move to an international company, Coca Cola ( KO ). Obviously, I don't even know if I need to give you guys the full rundown, everybody knows this company, but let's go ahead and just jump in to it a little bit. Coca Cola manufactures markets and sells various non alcoholic beverages worldwide and operates through a network of independent bottling partners, distributors, wholesalers and retailers as well as through bottling and distribution operators. The company was founded in 1886. Let that sink in a second and is headquartered in my city, Atlanta, Georgia.

Coca Cola earnings reported in July delivered a positive earnings report earlier the week that included street leading figures for Q2, non GAAP EPS, revenue and guidance all three across the board. Non GAAP earnings per share of 70 cents, which topped estimates by three cents. The company also surpassed revenue estimates by $730 million and a quarter where the world is going in turn oil. I'll think about that too, reporting a total for the quarter of 11.3 billion. Even more valuable to investors, Coca Cola raised its future guidance despite the challenging macro backdrop, Coca Cola now anticipates organic revenue growth of 12 to 13% compared to the prior expectation of only seven to 8% growth.

I mean, the new management is actually doing a really phenomenal job. I'm gonna go ahead and ask Josh to throw up the rating summary chart , obviously I'll point it out. You saw it again on the similar page, I'll say that time and time again. Seeking Alpha Authors are a hold. Wall Street analysts are buy and the Quant system is currently a hold as well. Let's check out the factor grades. We see the factor grades we have a D for valuation and a D for growth. It's not a stock that's there for you to get rich quick. I mean, that's what kind of is this highlights to me. It's a solid long term dividend play.

Speaking of dividend, it does pay a dividend. The yield is currently 2.81%. It's a 70% payout ratio, which has actually come down from 95% during 2021, which is a very good sign for investors, management allocating the revenue and their new revenue properly. Pretty much so payout ratio for those that don't know, if it gets towards 100 over 100 kind of start to worry, as an investor, as a shareholder, are they gonna be able to sustain the dividend?

Are they gonna be able to grow the dividend? The lower that number is the more favorable for you. I think that's a pretty easy way to sum it up. And Coca Cola has grown its dividend over 59 years, even during the pandemic. This is such a powerhouse of a company, the moat around this company exists. The products are internationally well known. You talked about marketing. My marketing for this company is insane. They know how to strike the emotions. They're endless sports, they're everywhere, you go to the movie theater as you just mentioned, by the way I saw Regal Cinemas is doing $3 movies a Saturday if you have a Regal near you, you can go check it out.

Coke is everywhere. It always has, it feels like it always probably will be. They are acquiring new beverages. I mean, I'm surprised they haven't acquired Celsius and all these other companies. I mean Monster I'm sure they probably looked at at one point. They have a large runway ahead of them. UBS just pointed out today that they think this is a high conviction stock pick, they think management's do an excellent job.

Let's look at the chart. Let's look at the chart of Coke 'cause obviously, like I said, this is one oh, sorry, dividend grades, completely forgot about this. So here's the dividend grades offered by Seeking Alpha obviously. I mean, those are solid graves across the board. This is a long term dividend company, if you wanna have this in your retirement portfolio, that's probably a good idea. If you're investing for the long term horizon, this is probably a great stock to have within your portfolio as an allocation.

I mean, the thing about it, if you go get a coke from a gas station, right? If the Coke costs $1 or $1.10, you're probably still gonna buy it. If you wanted Coke, you wanted Coke and they have that pricing power with their brand name. Now next slide, Josh. So this one, there it is. There's one I was looking at, I was like oh, this is the daily chart by the way. You see there's a huge gap, I forgot to highlight it for you guys. So there's a couple of gaps below the market obviously with the nice turnaround that the company has been doing since the end of last year. The thing that worries me about this chart from a technical level is if you wanna get into patterns, I don't always get into patterns, but I drew this little white hyphenated line. It kind of is looking a little bit like a head and shoulders to me, which I wanna take note of obviously, if a head and shoulders pattern breaks to the upside and fails to cross over to the downside, you can see nice price appreciation ahead but I think this one has gotten a little outside of its range.

So what I did is there's a saying when in doubt zoom out. Next slide Josh. I zoomed out to the weekly chart on this and you can see the long term trendline before the pandemic, you see the long term trends, you see it, you follow it, and you would have made money buying at the bottom line selling at the top line, time and time and over again. I mean, it's just what the chart shows, it doesn't happen every time, obviously, as you see on the chart as well.

But it looks like this one might be a little extended, I don't know if Coke is, can it sustain at these levels? Maybe it needs to pull back a little bit, reset a little bit before it has its continuation higher, but I'm not trying to day trade this one. I wouldn't try to day trade coke. I would maybe say oh, I wanna dollar cost averaging over a long amount of time for a long time horizon. But that's just what I'm noticing. Mike, you have a chart as well. What are you seeing?

- Okay, so let's talk about the company, right. Sugar water never goes out of style. It's why it's one of Mr. Buffett, I don't know if you ever heard this guy, Warren some guy out in Nebraska or something I don't know.

- What, the legend?

- What is it? He's a day trader and something like that. So anyway, so sugar water doesn't go out of style. Fantastic point you made? Okay, here comes inflation. So instead of paying $1 for a Coke, you're paying $1.10. Yeah, they're still gonna buy it. And they're still gonna buy it over RC Cola and Pepsi and everything else, right? Yeah, no, Pepsi ( PEP ) has a big market share also. So but mostly because of what else they own, right. But, Coca Cola is the premier sugar water, for lack of a better word out there. They're probably, you can never say never 'cause we've seen some big falls from braces, I'm speaking about General Electric overall. But there have been some falls from brace. But it's doubtful that Coca Cola is going anywhere, right? Because even in times of recession, there's something called the lipstick effect. We like to go out and hey, you know what, I can't buy the boat, I can't go on four vacations a year. But you know what? I still want an ice cold Coke.

I read an interesting stat. And this is a little off path. But I know we're short on time, so I won't go crazy on it. But I read a recent statistic that people were talking about how some high end restaurants were hurting but actually low and mid range restaurants are still booming. Why? 'Cause people are moving from the high end down to the low end. And that's why like the the provider, I forget the name of the company, I can look it up, the provider for a frozen french fries from McDonald's ( MCD ).

That stock is doing incredible because people are going and they're still buying french fries. And Coca Cola in my opinion falls into that category. People are still gonna drink Coke, no matter the health crazes, you shouldn't be drinking Coke. If you're on this paleo or keto or whatever. You're not supposed to have the sugar. Okay, well, that's a fringe group, because for the most part look, my kids are a fringe group. They're not allowed to drink soda, right? But my wife she pounds Diet Coke, she loves it. I used to be a Diet Coke, Diet Dr. Pepper, huge fan. I haven't drank soda, luckily, in years, but whatever it is, we're fringe groups, most people still call and they still buy Coca Cola.

Now on the chart, we broke down at of what looks like could be a triangle, where below the 50 day moving average, which is the blue line, but we're still above the 200 day moving average. And again, even if we push below the 200 day moving average, like we did in June, that doesn't mean it's necessarily a sell. Let's sell it right now. No, that's not what it means. It means it's an area to watch. If you go to the next chart, Josh, this is a monthly chart of... No, no, I had a second Coca Cola chart if you got it.

- I don't think we got it. That's might be on me.

- That's all right. That's fine. I had a second chart of Coca Cola. It was a monthly chart, and it just showed. Yeah, there have been some wiggles and there has been some volatility and even went down during the pandemic crash. Whatever it was put in the end, it's been in a solid uptrend since the 1960s. So yeah, this is a very good stock. Like, I totally agree with Daniel, it's not a day trade stock. But it's something that you may wanna consider. if you wanna look at it in your, there it is just a monster. Not straight up. But also, not really, yeah.

So again, a decent dividend. It's not beating inflation yet, but it's still beating what's around the 10 year, whatever. It's a decent dividend. And it's just, when you look at it from a business side, where is Coke going? When are people going to raise their hands and say I'm gonna, it's a comfort food, a Coca Cola is a comfort food. And the more stressed out people get, if there's a recession if times are tough, what do they wanna do? You know what, I'm gonna have a Coke and a smile, and I know there's caffeine and then it's not always great, whatever, that's fine, but it's still better than of course some of the other alternatives.

- I might give people a little sneak peek here, obviously so we're on Seeking Alpha and we have the peers tab , which is always cool. There's the radiance against competitors Keurig Dr. Pepper ( KDP ), obviously, we know Pepsi Co we know, Pepsi has more than just soft drinks, they have snacks and everything as well. The one thing I wanna point out for everybody about Coke too is also remember that you have international companies around the world that act as pretty much like the bottling companies.

So Coke has the recipe, they sell the recipe, license ingredient, the makeup pretty much, So all these other Euro Pacific partners, or Asia partners, or whatever they might be called, those companies pass royalties back to Coke. And that's how you kind of have an international effect to where you can cut down on all sorts of expenses. So that's where it's like Coke is bigger than what you think. Like you think Coke is just based out of Atlanta, Georgia? No, Coke is always gonna be international. They've got arms all over the world.

- Look, I don't think it's the number one brand in the world. If you wanna know, I think McDonald's is but Coca Cola is up there. You see that red background with the white swoosh. You know it's Coke, right? But so yeah, they're really ingrained in our society.

- Not to mention they also, I mean, they they teamed up with McDonald's, right? Like I remember growing up seeing the McDonald's commercials where it's like, go get a Coke from McDonald's and then like you hear the refreshing thing, you're like, oh, that's Coke. And then hear, all of those--

- Here it is. Here's my McDonald's glass, Coke glass right here. You can't see it but it says Coca Cola. These are my favorite glasses I drink out of every day.

- Anyways, let's move on to the next stock. Thank you for so much for pitching us Coke. That was a fun one to dive into. We're gonna move on to MNRL is the ticker of our next one, Brigham Minerals ( MNRL ). This was given to us by Dave on Zoom last week. So this one I had no idea about. I didn't know anything about this company. So this was a fun one for me to research. This is a small cap company based out of Austin, Texas. It's an oil and gas company focused on exploration and production. It focuses on areas only mainly through the US, think Oklahoma, Texas, New Mexico, Colorado and North Dakota. It also collects royalties from other large name operators drilling for oil and gas on their net royalty acres. So pretty much they own a lot of net royalty acres.

Big companies like Chevron ( CVX ) or [[OXY]] whoever, pretty much pay them a royalty payment to drill on their land. So quick earnings peak, record daily production volumes of 13,019 barrels a day. Currently, they beat on their EPs in revenue. But what oil and gas company didn't. The revenue of $90.88 million is up 140% year over year. Let's go ahead and pull up that rating slide Josh of their ratings, obviously, you see it. No Seeking Alpha Author is currently covering this topic as well. You won't see a rating there. But Wall Street has a strong buy on the stock and the Quant is a hold.

Let's go to the factor grades . It's pretty mild across the board. Not best in the sector. It's a smaller company and it feels like management is more risk averse, which is nice to see in this sector as the time going forward through the rest of the decade. We're seeing you know EV adoption, everything else, you really gotta find they're gonna drill for oil and gas, who you gonna sell it to, you're gonna get the jet fuel to the airlines. I mean, you gotta you gotta really think ahead here. This company would have been better if starting decades ago.

They just announced a recent acquisition as well. Avid Natural Resources assets in the Midland basin, which is in Texas, that seems to be an area that they favor pretty well. They're paying up $132.5 million in cash for that. Their CEO Rob Roosa said, adding that he views the deal as the highest quality Midland basin package we've evaluated to date. And they said they kind of played the long game on this one in order to get this acquisition set up. And they think that it's gonna increase their estimated production around 750 to 950 barrels per day 60% of that being oil. This company does, the dividend is a little weird. I mean, that needs to be said upfront, it pays a 2.08% dividend yield. Did I bring the dividend grades for this one? I forget if I did. Yeah, I think it did.

Go to the next slide, Josh. Boom, there you go. So dividend yield 2.08%, payout ratio, like I mentioned just earlier, it's over 108%. Something I wanna watch, the dividend growth is zero because their dividend is just super inconsistent. Pretty much random, which is why the dividend consistency is a D plus. They actually highlighted a lot in their recent earnings that they paid a variable dividend. So the dividend was the highest that they've ever paid. Well yeah, because they made so much money and the company didn't have a way to utilize it for growth of the company. So you give back to the shareholders. So let's go to the chart for this one. To point out this one.

Obviously he's had an ISO pullback I mean it follows oil prices almost to a tee. Fibonacci is providing a nice little support, I mean you can see it the 618, it goes up, it touches, it comes down and touches again, and on the third time it broke through, came back for the retest dropped down below it. I mean, this thing is kind of just hovering right there right now. Oil and gas. I mean, this is something that you got to think about personally as you invest for your portfolio, if you already leveraged in other companies like Chevron or Exxon Mobil ( XOM ), or some of those other big players probably don't need this one.

I don't know if long term investing wise in this entire sectors, the smartest idea, I mean, there, were always going to be oil and gas. That's my opinion, there's always going to be a need. But it's kind of at some point, you gotta remember OPEC controls everything oil and gas as much as we wanna believe the United States. I mean, look, we can be self sufficient, but it's an entire global market, oil and gas is sold and managed dollars, right? As long as it's managing US dollars we gotta play fair. We're gonna try to help Europe out this winter with natural gas, but the infrastructure is not there. I mean, there's a lot of things like that. Freeport would be that play on LNG probably, as they restart their exports. Mike, what do you think? Are you big oil and gas guy?

- I mean, you can't not be this year, right? Because it's one of only two sectors that are up, right, one of only two groups, whatever you want to call group sectors. But look, great point. And I love when people complain about oh, and this and gas prices. They're not set by us, right? I mean gas prices, I guess are. But they can be part of what I was, but the oil supply. If we decided, hey, you know what, we're not gonna let OPEC run things, we're gonna do things, it would cause major, major problems across the world. And this is a whole topic for a comment, this could be a whole webinar, right?

And I'm nowhere near, you got to bring Michael Boyd on, which I know you have already. But he could much more speak to this than I can. But yeah, I mean, it's tough to look at what's going on in the oil sector right now and not be interested in. And if you go to my chart, Josh, you can see here, this isn't a really big mover. A little thing I'm looking at here is the low volume, right? So this is below the price chart is a volume chart, as long as it's over 500,000 average a day it's okay, I'll keep it on my radar. But this is barely holding that line. It averages about 525,000 shares a day. It's not really a lot of shares.

Looks like it'll probably go back up and test those highs. But that's not a big move from here. So again, to me, in the contrarian in me says, sure, you got to be around oil and gas because that's what's hot in the market right now. But the contrarian comes on the shoulder and goes, whoa, that's the kind of thing you have to worry about getting overbought. And overbought just means it's gone up too far too fast. So maybe it's due for a rest. So that's why oil and gas I'm a little and all the points you made about this one, absolutely 100%. But to me, it looks like it could probably go to the highs. But that's only a couple of points from you. That's what I'm looking for.

- Not to mention, oil and gas will definitely get affected if we do in fact go into a recession like people are talking about next year. So you got to keep that in mind as well. Obviously, we watched the gasoline futures, the oil futures, WTI, the Brent futures, you're seeing significant pullback but then there's analysts like Goldman Sachs analysts coming out saying it's about to rip higher.

- There's a lot of cross winds, right? Worried about supply, there's a supply issue and this and that, but you're right, if there's a recession and people stop manufacturing stuff and stop going places and stop this. Yeah, if demand starts falling, well, guess what? There's gonna be less energy use, there's gonna be less oil and gas use because the production of it and the shipping it and all that stuff. So yeah, your points are all valid. And you're right, Goldman. I think I read Goldman came out with two different targets, one like oil in the three hundreds and the one in like the 60s, I think, I don't know. So sometimes it gets so confusing that you just gotta go to the chart for not your single source but one of your sources of truth.

- Exactly. Jorge, we do see you in the comments. I appreciate your comments on Palantir. The only point I got confused is that Palantir does not compete in cloud computing but analytics and AI. They are very much in the analytics and AI. They could use Amazon ( AMZN ), Google ( GOOG ) ( GOOGL ) or Microsoft Azure Cloud platform. I would encourage you actually to go to the Palantir symbol page on Seeking Alpha. If you scroll down to the bottom, you'll find the earnings and the earnings presentation. In their earnings presentation deck they literally spelled out we want Foundry, their Foundry product to pretty much replace AWS, like they say I think it was something along the terms of what AWS was in the last decade they want Foundry to be for this decade and going forward.

Like they pretty much want AWS to pretty much move their entire enterprise over on the Foundry to help people analyze their data and use the AI and analytics like you're talking about. So something that I would just recommend you go check out the symbol page and dive into those recent earnings 'cause they did talk about that a little bit.

We're gonna move on to the next stock here real quick. Devin on LinkedIn actually gave us this one last week, one that I never heard of as well. It's called Butterfly Network Incorporated ( BFLY ). So this small cap company is based out of Connecticut, it is a digital health company. But it seems to mainly focus around creating more tech advanced ultrasound imaging solutions. Think of machines that connect to things like smartphones and tablets, that's what they wanna do. They do offer a few other medical software solutions as well.

And the company has a huge international vision to pretty much I think revolutionize how medicine is done around the world. They have a partnership with the Bill and Melinda Gates Foundation, and the products are being sent to Kenya and other areas in South Africa with them.

But not only that, but their products can also be used on pets which led to their recent enterprise solution with the national chain Petco ( WOOF ) here in the States. It's a product called Butterfly iQ+ Vet, the world's only handheld single probe, whole body multispecies imaging system. And it's designed to bring valuable clinical insights to veterinarians at the point of care.

So they're branching outside of just one kind of path of what their solution is. Which is interesting to me 'cause I think if you have Petco then you can also have a bunch of other small players, vets all around the nation that might double down on this as well.

Now, important thing to note here is it's not a widely covered stock, looks like only one Wall Street analyst's actually covers this stock, which is pretty interesting to me. I think you'll see we'll touch on it again here in a second, but factor grades the revisions and F. So it seems like there used to be two analysts on the street that were covering this specific stock. Now it's only one that's usually not a good sign when people start dropping coverage. But let's look at recent earnings.

Earnings announced beginning of August as revenues up to, revenue was 19.2 million up 16.3% year over year. Adjusted EBITA though was a loss of 37.8 million during Q2, which is actually up by almost 10 million over the amount of loss in the Q2 of 2021. Usually not a good sign. Josh, those back over to you listed out the ratings obviously seem there, Seeking Alpha Authors are a hold, Wall Street analysts is a strong buy because it's only one analyst keep that in mind. And the Quant rating is a hold, on the factor grades, go to the next slide. Revisions and F pointed that out. But also profitability is a D keep that in mind. It's just not really there. It's probably because it's a newer company. They're trying to do growth at all costs. That was the game. It's not so much the game of the overall market right now. So keep that in mind.

Profitability is a D like I mentioned EBIT and EBITDA margin are horrible. They have a crazy amount of levered free cash flow in the trailing 12 months. Meaning it's not the best place to distribute net cash flow to shareholders with the amount of interest payments and tax obligations it currently has. Their gross profit margin on the product and services are in line with the overall health care sector. But they are bleeding cash, trying to obtain the growth as I mentioned. The only thing that does feel a little promising to me is their cash and cash equivalents on hand is 310 million. And their total debt is 32.17 million.

I think it was Peter Lynch, who said, you never have a company really go out of business that has more cash than debt. So keep that in mind. But the company doesn't pay a dividend. And it probably won't for quite a while as it's in his growth phase. Let's go to the chart, check out what's going on. Kinda pulled it back on the weekly chart 'cause I wanted to see the overall picture. Obviously, I have this white hyphenated line here across the middle of the screen about the $10 level. And why is it $10 level? Well, it was a SPAC. This was a SPAC company. So during this back boom, it came public, had a nice price appreciation, pretty much tripled right from the get go. And then just took everybody and wiped him out waterfall sellers probably came in.

This is not a great looking chart to me on the TA obviously, moving averages are a little wack just 'cause it's on the weekly and it's a newer company, not really looking too favorable, you're starting to see a little bit of a bend upwards on that, that's the 20 day of the weekly which could be promising if you just wanna look at a weekly perspective. And if you're trying to watch the Fibonacci here, from the top to the bottom, you would see the 618 is back up around 18, $19.

There might be an opportunity for a trade over the coming years but we're talking two years. So there's a lot that can change as we all know over the next few years. Medical industry, ultrasound keeping in mind not really an industry that I'm personally interested in either. Mike, what do you think? What are you looking at your chart?

- Yeah, so just sent you a chart but Daniel did a great job on the fundamental side and explaining what it is. On the chart had that big pop of momentum in August. Nice push through, but talk to me when it gets above 966 and of course, $10 'cause it wasn't backed, you see resistance above it 920, and 966. All of doing that is using previous swing lows. It had the big push forward, but look at that failure down. That's called a first rise, first failure pattern. It did hold the 200 day moving average, which was good. It did get a bounce. But again, I don't know what the long term prospects are on this.

Chart wise, it just looks like it's a little volatile kind of deal. Talk to me when it gets above 966 and preferably $10. Yeah, it's a really great take, great levels to point out as well. I wanna ask you, Mike, do you wanna go ahead and announce what this last stock is? I think this is the one that everybody would be most interested in. We should have teased it at the top of the show--

- That's okay.

- What are we doing for this last one, given the name.

- So the last stock we're gonna look at is everybody's favorite social network stock, network company Meta Networks.

- There it is, Meta Platform so obviously a lot of you here joining us.

- I apologize, I always get, you'll always be Facebook to me, so Meta Platform ( META ).

- That's exactly, I was gonna say. Alright, so here's my spiel on made Meta. I mean, everybody knows, but just for anybody that might not Meta Platforms formerly known as Facebook, and before that it was The Facebook is a large cap international child falling from grace. The company operates between two segments, family of apps, those being Facebook, Instagram, WhatsApp and Messenger and the Reality Lab segment, which is the metaverse endeavor with Oculus.

Now, the big question for this company at the moment is how do they adapt not only to the Apple ( AAPL ) privacy changes, since they get the majority of the revenue from selling targeted ads, but also can they actually pull off Zuckerberg's longterm metaverse play, which so far has been a laughingstock if you've seen any of the image or the news over the last coming weeks, I mean, everybody was just laughing at how bad it looked.

Meta's Q2 earnings were not good either. The EPS missed by nine cents and revenue miss consensus by 129 million. News came out yesterday on August 30, that hundreds of Facebook contractors are set to lose work, and that they are shutting down their gaming app venture after two years. So obviously, let's go to the deck Josh, going throughout this slide.

Seeking Alpha Authors are a buy on Meta Platforms, Wall Street analysts are a buy on Meta Platforms and the Quant is a hold at this time. Next slide the factor grades. So the one to note here is growth, obviously, right? That's just it makes sense by this point, if you know anything about Meta and what's going on with the company and how this stock has been crushed, right? Growth is D minus. It's mainly due to Meta's working capital growth, which makes sense, the growth of the company has definitely slowed down, as we all know.

And the biggest sign users can note from the strain that the company is feeling is to go to Facebook and Instagram and just count the number of ads that you see in your stories or your feed. I mean, they are literally pretty much to the max, the amount of number of ads that are throwing at you now without damaging the user experience overall.

Not to mention TikTok is eating their lunch. YouTube shorts is eating their dinner. I mean, this company is just feeling the pinch right now. Now, that's not to say that they're not gonna bring in a sizable amount of revenue, this great gross profit margin, but the earnings revisions for this company have not been healthy by any measure. In the last 90 days, there was only one upward EPS revision, and there were 36 down revisions for earnings per share and 47 down revisions for revenue. So the street seems to be completely over Zuckerberg metaverse playground venture. And Meta does not pay a dividend, although they very well could.

So what do I think? I think this company is struggling bad obviously, they recently increased the price of their VR headsets, two months before they're about to release the new version. That's not a good sign. They haven't figured out how they're going to solve the problems of targeting ads. As far as we know, the higher quantity of ads is going to ruin the user experience over time. And I believe, I mean, this is my personal belief, I believe that the world is going to want augmented reality over virtual reality. Now not to say there's not gonna be a space for virtual reality. Think about creativity. Think about product design, the automobile design, you're seeing stuff like that.

Obviously, gaming is gonna be huge in virtual reality, I can see that. But for overall productivity of just everyday life. I think it's going to be AR, we've heard Zuckerberg come out and talk about how he believes that the metaverse is really going to be Facebook versus Apple. And I don't know about you, but if I was putting money on it, I would choose Apple probably every day.

Now this chart, let's go Next slide. Oh, this chart. Oh, this chart Mike. This chart man. I mean obviously look, the stock came out the IPO. We all remember that, I think it was like $40, it crash next day and then just had to rip up to the upside. It's been crushing it, absolutely crushing it. And as you know, stairs up, elevator down, this is the weekly chart, by the way everyone, the weekly chart is as rough, you see a bounce along there, on the 20 day moving average, for the majority of the way, every once in a while drops down to the 50 day on the weekly and bounces off of that, obviously, you could call it double bottom, maybe there but we saw the rip to the upside. So I was like, okay, this is a little painful. So let's zoom in a little bit.

Let's go to the next slide, Josh, because I'm like, okay, where are we at now, what's tradable, what's actionable. Now, by the time I pulled this this morning, we of course had a gap up, everybody might have seen the news today, Snapchat cutting 20% of their workforce. The big, big news, once they came out and announced this, snap saw the rockets, the upside as well social media stocks, we saw that across the board, but what you're seeing there is it's bouncing off of the 50 day moving average and the 20 is above the 50, I don't think he's probably gonna get back to the 20, there's that gap that is already started entering that gap to probably do a gap fill here in the market.

It might get to the bottom of that gap, find a little bit support, and do a nice little reversal we'll see over time. But that's what I'm noticing from the TA levels. Obviously, the 200 day is very slimmed down. 100 days very slowed down. I mean, this almost reminds me of PayPal, when PayPal stock went up to I think it was 300 got cut after earnings. And people were like, oh, it's gonna turn around and they got cut again. I mean, they aren't on the struggle bus right now. So, Mike, what's your take? Meta Platforms.

- So if you go to the next slide. So let's talk about the company first. The fact that they're cutting contractors is a sign that they're starting to feel the pinch of the economy. So the first thing to go are contractors. Why? Because you don't have to pay them severance. And you don't look like you're a bad... You're not laying off employees you just laying off for people who, they're just contractors. So that's the first one. Number two, you're dead right with the Apple verses Facebook war. If I have to pick one, I'm going with Apple. It's a much more fluid customer. It's a much stronger brand. There's a lot of things in my opinion, Mark Zuckerberg is the brand of Meta, and I think he's damaged. They settled the Cambria analytics thing and who knows what else is going--

- For an undisclosed amount. So we gotta wait to see how that turns out.

- Exactly. I mean, and look, they were subject to the biggest FTC fine in history, five point whatever billion dollars, which turned into 11 days of their top line operating revenue. Yeah, they're flush with cash. So Wall Street loves them, I get it. But I think they've got a struggle, the Oculus, my son who turns 13, and a couple of days, he wants the Oculus, he wants the $500 version. Don't think he's gonna get it. And especially since you just now have told me that they're coming out with a newer version, I will kick myself in the tuckus, if there's a new version coming out, so he'll have to wait. He may be getting a delayed... But we'll get him a nice pair of slippers or something to hold them over. But then he'll get a delayed Oculus, more around the I guess the Christmas time.

But regardless of that, it's amazing because 40% of users of Oculus report getting nauseous while using it. That's the other thing too, just to let you know that, I don't know how many iPhone users, what percentage of iPhone users reports that. So if I'm making a bet on behalf of the Facebook, of Meta Networks, sorry, Meta Platforms. I'll say it right eventually.

Okay, let's look at the chart. All right. The chart you saw it is in a consolidation pattern. What usually happens when we go sideways like this is when we finally break, we usually get a move equidistant to what that range is. It's just a rule of thumb. Okay, it's not it has to go this far. No, that's not what it what it is. So I did the math for everybody, but really for myself up above, so the range is 183.85 on the upside, 154 and a quarter on the downside, that's those two lines I have drawn, that equals $29 and 60 cents. If you take $29 and 60 cents and take it off of $154 and 25 cents. A measured move for Meta Platforms Inc, I said it efficiently now, would be 124.65. That's 2018 lows, that's the end of 2018. So now again, we could break to the upside and if we break to the upside, if we break above 183.85, then you wanna throw about 30 points on to that, a little bit less. And then what you got there is you have this thing going to 213.85 which by that time the 200 day moving average which is that black line you see sloping very down very hard that could come into play there. So I'm not saying we have to break to the downside.

I agree with you the chalk looks awful in my opinion, it did not get a good bounce with the rest of the market. Sure, it got a bounce off the June lows for a little bit. But it didn't go, it didn't scream, it didn't get 20% off the lows, that rule of thumb, and it was one of the first ones to roll back over. It rolled over before the S&P hit the 200 day moving average. So this in my opinion is a weak stock again, company in the stock are always separate. Company has ton of cash. Look as much as I hate them, although I'm on it way too much. The gram and the book.

It is the number one social media company. All right, you're right. YouTube shorts and TikTok especially, I mean, it's crushing them. But they're still the king. They're still the king of social media right now. So again, you always have to keep that in mind and you definitely don't wanna look back a couple years from now and go wow, how could we not have seen this? But with you, I think it's going lower. I think it's going to at least that 124.65 number here.

- We'll see that oh, the great. Also Jorge, I gotta say great point there on Palantir. I love that response that you shared, everybody should read that in the chat. Sammy says if I were to pick two heavyweights stocks that I think will sink more in the mid future is Facebook and Apple both, third is Tesla. Interesting viewpoint as well.

- I think one's Apple is in the cause, I think it's game over.

- Cars or AR glasses, if they can price the augmented reality glasses and really nail that and I think they're probably the only company that can really do that. I mean, I got the watch. I got the air pods. I got the phone, I got the Mac I mean, I am so Apple ecosystem ingrained. And if you told me hey, put on some glasses that gives you more computer screens and actually work, whether it works off your phone like your watch or not. I mean, they have the majority of the software already there.

I think they can pull it off just me personally, but they got to release it right. We had the September 7 iPhone event. I'm not sure we'll get a surprise with the glasses this year. A lot of analysts are saying maybe next year, but we've been saying that for years now. So we'll have to see what happens with that. And then of course the car like you mentioned. But Jorge asked you, is Meta a long term bet? If I'm thinking long term, what do you think, Mike? I've got an opinion.

- Not right now for me. Not right now, not when it's under a, long side that. I'm assuming he means long side, right? To me, no. Not when the 200 day moving average is trending down like that, not when it's basically showing very poor relative strength. Even if it doesn't dive and go to my 124.65, it's not really that big of a move, right? But even if it doesn't go there, what if it just keeps going sideways? It doesn't pay a dividend. So what are you gonna do? You just gotta oh, I hope Facebook, okay, for what--

- I think that dividends could stabilize it. If they were to come out and start saying, hey, we're gonna start. I mean, they have the cash flow to do it. They have revenue coming in like crazy. I mean, obviously, they're spending a ton of it on metaverse and everything else. But I mean, like, they got to consolidate the company. My personal opinion, and like we always mentioned guys, this is only our opinion, this is not investment advice or all that, you got to do your own diligence. If they can figure out how to get around the Apple privacy, the potential Google cookies down the line, they have the Facebook pixels and everything else that they've integrated across to track you across the web. If they can figure out how to get their data together again, and it's probably going to be internal.

All these companies are moving to that internal metric. You bet Google is doing it. I mean, they're gonna be completely fine in my opinion, Austin and I have shared that with you all before. If they can figure out the data play, to where they can get back to charging three, four, 20 times as much as they're charging for targeted ads right now. That's what really see this thing just rip to the other side. So if we get any whispers of that, you better believe there's probably going to be a nice little pop that day. Because that's where their revenue comes from. They target ads. And don't you forget that. They tried to create their own software for the metaverse and the VR play. They ended up scrapping it runs on Android now, but they were trying to control the ecosystem, control ad placement, get their cuts.

I mean, they were trying to do what Apple is doing with the App Store. And it makes a lot of sense, but they just couldn't pull it off. So if they can pull it off in the future, I would consider going long. But Mike, I agree with you at this time, I probably wouldn't touch it. And that's my take. Anyways, that is the last doc. Josh go ahead and throw up that last slide. Now I want to go ahead and ask everyone. Thanks for hanging out with us for this hour. Whether you were on social media channels, whether you were on the Zoom, we love doing this. So if you can give us a stock you would like us to break down, analyze, do a little research for you on, we will take those into consideration for the next week's show 'cause we always like to ask you to if we can help. Dave, thanks for showing up. Danny, Dan, Christian, Anna, Enrique, Hans, everybody that's here with us in the chat. Saye, it was great breaking down your stock for you today. Meta of course just has a little ways to go. Skip. It's good to see everybody. Jorge, have a great day.

If you wanna reach out to us. You can reach me on LinkedIn, Daniel Snyder. You can email us at stockmarketlive@seekingalpha.com . And Mike Saul, your email's michaels@seekingalpha.com. Correct?

- Correct.

- All right, everybody. Well, let's go ahead and throw in a little bit of the jams. Start seeing those stock picks. Also don't forget Alpha Picks has launched the new service by Seeking Alpha. You can go check it out right now, you get to stock picks every single month. It just makes everything easier. And on top of that, we are running a Labor Day sale . I should put that in as well. Labor Day premium sale. I believe it's 50% off isn't it, Mike?

- Correct.

- So let's give back to the people a little bit for the Labor Day weekend. Let's get on out of here Josh go ahead and wrap it up.

For further details see:

The Meta-Hurt With Special Guest Mike Saul!