Video summary
The market recently experienced a downturn with all major indices declining, yet notably, volatility measures like the VIX dropped significantly despite the red day. Amidst this broader weakness, seven specific companies reported their earnings results, presenting a mixed bag of outcomes for investors. The analysis highlights that while some stocks reacted positively to strong performance, others suffered severe sell-offs due to missed expectations or lowered guidance. A key takeaway from these reports is the critical importance of forward-looking statements; when a company lowers its future revenue or profit projections after hitting all-time highs, it often triggers a sharp price correction regardless of current earnings beats, as investors prioritize what lies ahead over past performance.
Airbnb emerged as a standout performer with an exceptional double beat in both sales and adjusted EPS, driven largely by increased foot traffic during the World Cup which boosted hotel and rental demand across US cities. The stock surged into new highs following these results, validating a thesis called out weeks prior about capturing summer travel momentum. In contrast, Regetti Computing reported earnings that were essentially flat with estimates but missed slightly on sales, leading to a modest decline as its chart continued a downtrend throughout the year. Similarly, Trade Desk faced a disastrous reaction after missing both revenue and EPS targets while simultaneously lowering guidance for the upcoming quarter; this double miss caused shares to plummet over 20%, illustrating how deteriorating fundamentals can quickly erode even previously popular turnaround narratives.
The transcript also examines several other tech and betting sector stocks that displayed significant volatility post-earnings. DraftKings managed a mixed result by beating EPS expectations but missing revenue, resulting in a stock price hovering near its opening levels despite being down significantly from January highs; the presenter notes the intense competition and lack of moat in this industry make it difficult to sustain long-term gains without unique advantages like those held by major beverage giants. DataDog presented an interesting case where the company delivered a strong double beat on earnings and raised guidance, yet shares still fell over 20% because the stock was considered "priced to perfection" heading into the report; this suggests that when expectations are extremely high, even stellar results may not be enough to prevent a pullback if any minor disappointment exists. Finally, Fiserve saw its shares drop after missing EPS and lowering guidance despite beating sales on revenue, with the presenter warning against falling for technical "gap fill" patterns as the stock appears vulnerable to further declines in its established downtrend.
Overall, the video concludes that while some earnings reports provided clear buying opportunities or confirmed strong trends like Airbnb's rally, many others served as cautionary tales about market sentiment and valuation sensitivity. The presenter emphasizes patience when trading stocks currently in a downtrend, advising investors to wait for confirmation of a breakout rather than chasing falling knives based on potential turnarounds that have not yet materialized. With football season approaching, there is hope for some recovery in the betting sector, but until competitive advantages become clearer or technical patterns shift positively, maintaining a sideline position remains a prudent strategy given the high costs and fierce competition inherent in these specific industries.
Read the full video transcript
All right, jam-packed video, guys. We
have seven stocks, seven companies to
break down. All of which just reported
earnings. Most of these just came out
literally 5 minutes ago here after the
bell, but I think two or three of them
reported earnings this morning. So,
let's dive into it. Hit the like button,
make sure to subscribe, follow along for
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updates. Be a part of my private
Discord. That's all linked down below,
pinned in the comments as well. And now
guys, with that being said, cheers. We
have we have water today. We drank all
the coffee already. We're on to water.
Let's dive into it. So overall, the
market didn't have the best day. Every
index went down. Oil went up. Both Brent
and WTI. Brent went up 4.5% and WTI went
up around 3.3 3.4%
as we're starting to cool off a bit on
SPY after breaking out to all-time
highs. Same with the Dow Jones, right?
The Q's are starting to get hit here at
the top of the channel. We covered this
in my previous video, right? So, I don't
want to go too deep into it. So, that's
where we're at with the overall market.
We had a bit of a red day. Uh but even
with the red day, the VIX went down
4.5%. Think about that, guys. Think
about that. So, with that being said,
let's just dive into these numbers,
break down some of these companies. I
didn't look at any of these earnings.
Um, at least the ones in the
aftermarket. I haven't seen them yet as
they just literally came out, guys. So,
Airbnb is number one. And oh my
goodness, man. Look at this stock go. It
is going ballistic. We closed at 151.
Now, we're pushing 170 in the
aftermarket, guys. So, they must have
crushed earnings, obviously. You know,
duh, right? EPS came in adjust uh is
that adjusted? No. EPS $137 that beat
the $1.25 expected on sales of 3.6
billion versus 3.57. So a nice double
beat and they see guidance let's see Q3
sales of 4.69 to 4.77 billion versus 4.6
billion expected. So very good guidance
nice double beat. Um anything else here
they expect
but overall what's going on? It all has
to do with, in my eyes here, um the the
World Cup, right? That brought an
unbelievable amount of uh foot traffic
to all these cities in the United
States. And guess what? People are
staying at Yeah. hotels, but Airbnbs as
well. And we actually called this out a
couple couple weeks ago. What a trade
this was, guys. Uh we called it out when
it was at 140, right before the World
Cup even started. Uh, was it before the
World Cup? Either way, the thesis was
we're gonna rip into the summer, into
the travel seasons after the World Cup.
And here we are, stocks going ballistic,
great earnings, great double beat. And
would I be buying it now? Probably not.
You know, I I'd be selling into this
strength, but Airbnb is looking
phenomenal. Fresh high on the year and
probably a high on the one-year chart if
I had to guess. Yeah. And on the 3-year,
we're getting close. We're pretty much
testing the highs now from the early
days of 2024. So, very good print out of
Airbnb. Stocks going nuts. We had
Regetti just report as well. RGTI is the
ticker. This company is Regetti
Computing. Let's see. Are there are
their earnings out? Yep. Adjusted PS,
they lost 5 cents, which came right in
line with the estimates. and sales came
in at $5.1 million uh versus 5.15
million. So they missed sales um
obviously this is an early stage company
guys. So 5.1 million versus 5.15 million
and again adjusted EPS they lost 5 cents
which came in line with the estimate and
the chart right here. Let's see what
we're looking like. It's been
downtrending all year. Now we're down in
the aftermarket. Not much. Uh, but we
did dump around a dollar initially. Now
we're at 1618,620,
down about 30 cents in the after market.
So, Regetti is definitely one that I've
been tracking all year. Um, we broke it
down here a couple months ago, a couple
weeks ago, whenever that was. Um, and
now it's kind of testing that low from
earlier in the year. I'm not loving the
chart. And quite frankly, I'm going to
wait until we show confirmation of this
thing actually starting to break out,
which I don't think that's going to
happen until we take out at least 18 to
20 bucks. So, I'm being patient on
Regetti. And we got earnings out of the
trade desk as well, TTD. And oh my
goodness, man. This thing is off a
cliff. Holy smokes. TTD closed at
$17.67.
Now it's at 1365.
Oh my goodness, guys. We are down 22% in
the aftermarket. That is rough. I feel
like every time we cover the trade desk,
it's tanking on earnings. I mean,
probably not every time we've covered
it, but man, more often than not, it is
it is off a cliff. The stock's at 13 a
share now. My goodness. So adjusted EPS
missed 34 cents versus the 40 cent
estimate on sales which also missed $715
million versus 751 million. Um so double
miss. They expect Q3 revenue of $650
million. So a lot less than what they
just reported. I'm not sure what the
estimate Oh my god. The estimate Oh my
god. the estimate $85 million estimate
on that Q3 number guys and they said
650. So analysts were off by $150
million. That is why the stocks getting
nailed. Very poor guidance and that's
what it's all about. Stocks are
forwardlooking vehicles. And if you tell
a stock, an investor, a company, oh by
the way, yeah, our sales are going to be
$150 million less than what you think
next quarter. What do you think's going
to happen? right? The even if a stock's
in a downtrend, that could send it even
lower. And that's what we're seeing
right now. And this is why I don't play
the turnaround plays. This is what I
said in the last video. Did I not say
this in the last video? The trade desk.
You might you might you might have been
like, "Oh, it's a turnaround play. It's
down so much. How how much lower could
it go? It was just at $45 back in
November. Oh, it could go lower, right?
I mean, look, their numbers are
deteriorating. If a company is not doing
well at that moment in time, there's no
reason to chase it unless you're
confident they're going to turn around
and you're not afraid to hold for a lot
longer than you think. Um, so in this
case, you know, it's down another 22%
after a cut in half, more than that
throughout the course of the year. So,
uh, not looking great for TTD.
DraftKings also just reported, let's see
these numbers, guys. DraftKings is at 22
a share as of today's close. Now it's at
2180 in the aftermarket. We got to 2350
down at $2060 as well. So it's all over
the place. Pretty much break even.
Little red in the aftermarket. So they
beat EPS.
Adjusted EPS 9 cents which beat the two
cent estimate but sales missed 1.44
billion versus 1.516
billion. So, mixed earnings, big miss on
revenue. That's obviously not good in
the short term, but I guess the stock's
down so much. I mean, this thing was at
$36 in January.
It's almost cut in half. So, how much
lower could it go? Um, if I had to
guess, we ultimately will take out 20
bucks, I think. So, guys, um 20 bucks
has been support all year, but clearly
we're making lower highs into that
support. we have a descending triangle
and this business is so competitive,
right? It's so competitive um to the
point where their costs are so high, all
the marketing, all the this, the that,
the promos they're running. Who's paying
for all that? Obviously, DraftKings is
paying for that. I mean, they're they're
paying out the wazoo for all this
marketing. Yeah, football season's
coming up. It's the slow time now for,
you know, for betting. That's going to
be good for DraftKings. Maybe we'll
revisit this stock in like a month.
Maybe it starts breaking out. But for
now, it's just not looking pretty, man.
It's such an expensive business to run.
So much competition. And what's the moat
of these businesses? What is the real
competitive advantage of a DraftKings,
of a you name it, any of these players?
There is no competitive advantage, guys.
I mean, people bounce from app to app to
app based on the promos, based on where
they can get all the the the the best
deals to to bet. I mean, it it's all
this is an uninvestable category for
that exact reason in my opinion. Just
like the MJ stocks, you guys know what I
mean? Snoop Dogg, Puff, Puff, Pass,
right? Just like those stocks, they're
uninvestable because so much
competition. There's no moat. I mean,
until we get a Pepsi and Coca-Cola and
that industry, I'm not investing. So,
it's tough to buy these types of stocks,
but ultimately with football season
coming up, who knows? It could go
higher. But for now, I'm on the
sidelines and I have been for quite a
quite a while. I've traded the stock a
couple times, uh, but it's been a while.
So, QBTS is another one. I'm pretty sure
this one came out in the morning. Uh,
this is D-Wave. This stock went down 10%
on the day. O yeah, it hit 2250 in the
pre-market. Got all the way down to $18,
guys. This thing fell This thing fell
20%. Um and let's see what they did
here. Revenue came in at 3.07 million
versus 4.02 million. So they missed
revenue by a million guys pretty much on
EPS. They lost 13 cents. That missed a
loss of 10 cents expected. Ah, I got to
get some water water after that one,
man.
That is not that is not good. Double
miss. So, a lot of these companies that
we're covering today, coincidentally,
are uh, you know, double missing or at
least missing one of the two. So, that's
rough out of D-Wave and it's been
downtrending kind of all year just like
Regetti. Um, not really different there.
And for me to trade these guys, I need
to see them break out. I need to see him
break out. Right now, we're in a
downtrend, seeing little relief rallies
within the downtrend. I need more than
just that. So, data dog is another one.
DDOG, this one uh was this morning. Oh
my gosh, this thing fell off a cliff,
guys. 20% down. Uh we closed down under
230. We went down over $50 a share on
the day. Absolute bloodbath for Data
Dog. And that's on earnings that Let's
see what they did here, guys. I saw them
this morning. Um they yeah they double
beat. I mean guys adjusted EPS 65 cents
versus 59 cents expected on sales of
1.12 billion versus 1.02 billion. Um
they raised their fullear adjusted EPS
guidance and they raised their full year
26 sales guidance uh which is very good.
They expect Q3 revenue in the range of
1.14 to 1.5 or 1.15 billion. Pretty good
there. So, look, at this point, it was
probably just too priced to perfection,
too highly priced. The stock was trading
near $300, which I'm not sure, is that
the alltime? Yeah, that was, you know,
it was at an all-time high. It was
trading at an all-time high heading into
earnings. And look, price to perfection.
And yeah, they raised EPS, they raised
revenue, they beat EPS revenue, but
maybe not by enough. A and you know, if
you're priced to perfection heading into
earnings, earnings have to be stellar
for you to even keep the gains and
phenomenal for the stock to go up even
higher. So, if there's any little part
of the report that disappoints, a
stock's probably going down after um
earnings if it's at all-time highs and
overbought heading into earnings. So,
data dog, honestly, this could be a
great reset for the stock. Um maybe we
find support in the low 200s. In fact,
that's where I think we will find
support. Uh 220, 215, that general
range. If we fell through that, maybe
maybe we have a little gap down to go.
Uh but for now, I'd be watching data dog
to hold low 200s, 210, 215, 220. And one
more here, guys. Let's do one more. And
by the way, by the way, guys, if you
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if you want to, guys. I'd be glad, we'd
be glad to have you in there. So,
Fiserve is another one that reported.
This stock has been down all year, even
from the end of last year. This thing's
been bludgeoned all year, guys. And
look, it hit 240 about two years ago. Oh
my god, a year and a half ago. So, this
thing is down massively. Um, earnings
came out and it is up, it looks like.
No, it tanked in the morning. Then we
filled the gap. That's right. This was
in the morning. Um, so it tanked from 54
to 47. That was a 13% drop and it pretty
much filled that gap. So, if you bought
that initial uh initial dump, you would
have made some money there on Ferve,
guys. Um, it looks like they reported
earnings per share of $184 adjusted.
that missed the $1.91 on sales of 5.29
billion versus 5.03. So they beat sales,
missed EPS, and they lowered their
fullear adjusted EPS guidance from 8:30
or 8 to 8:30 now to 720 to 740. That's
under the estimate. That's not good. Um,
I don't like that at all. So honestly, I
feel like this thing tanked initially.
It filled this gap. I could see it
tanking again based on those earnings,
the lowering of the guidance. I'm not
falling for this gap fill here. This is
easily shortable in my opinion. Uh well,
not easily. Nothing's easy in the stock
market, guys. But if I had to take a bet
here, Fiserve is not breaking this
downtrend on those earnings. I just
don't see it. Um, you know, we might
chop around the mid50s for a little bit,
but I could see this thing back I could
see this thing back in the mid high 40s
like that pretty soon here. We'll see
though. We'll see. Uh, what do you guys
think? Let me know in the comments. I'm
going to wrap it up here. Um, and full
disclosure, I don't own any of these
stocks as of this video. Maybe I'll
trade them. They're on the watch list.
I'm watching them post earnings. Uh, but
as of this video, I don't own any of
these stocks. So, what do you guys
think? Let me know in the comments. Hit
the like button. Subscribe again. Check
out the Patreon. All that stuff. I'll
see you guys in the next video.