4 Stocks We Like for Friday…

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Futures are again down at post time this morning after an 800-point slide driven by a big tech sell-off. As a sector, tech had its worst day since March falling 5.83%, with Apple taking the brunt of that at 8%.

It is no secret that FAATMAN stocks have driven the market rebound — the S&P tech sector is up 70% for the year — and when that heavy concentration of gainers stumble, well, things fall apart to quote my Yeats.

I mean, let’s be honest, what are the disruptive ideas coming out of the big tech sector right now? Sure, Amazon lofted the idea of a “ghost grocery” store, which I discussed yesterday, and I like the idea, but the market just seems like a lot of cash chasing very little new innovation…So, in response, what did smart traders do yesterday, they started selling big tech…The bandwagon is just too full of greedy schmoes…

Most analysts I read yesterday along with Bloomberg and The Wall Street Journal see the sell-off as a profit taking event and some removal of short-term froth after a historic run. My take: yesterday was a bunch of fat cats taking their cash to the pool party before Labor Day. That said, I think there is a world where technology stocks sustain this support, but I think a likelier scenario is that we see some measured pullback as we enter an uncertain Fall with an election ahead that could throw out some disastrous headlines.

Today, the jobs report will be key to market performance. The expectation is a modest 1.4M jobs were added in August, after 1.76M in July, and maybe we see unemployment dip below 10%. Even if we do see those numbers, we are still around 11.5 million jobs shy of the pre-pandemic level.

To top this off, we have United Airlines talking about cutting 16,370 workers in October and Ford will cut 1,400 salaried works by year end. Spirit AerosystemsStanley Black & DeckTextron, and many other companies have quietly announced that temporary layoffs will turn into permanent reduction. Plus, Juul said it would lay off more than 1,000 people as it sliced its workforce in half, according to a report released this morning.

I see a lot of corporations are right-sizing their workforce for the post-pandemic world. And, as a cruel irony, I think it plain blows that ahead of Labor Day corporations are lightening their loads to increase operating leverage so as to appear leaner and more attractive to the wall of cash on Wall Street (thanks to the Fed). But I will suck it up…

World shares are rebounding as Germany’s DAX gained 0.4% to 13,101.39 and the CAC 40 in Paris jumped 0.8% to 5,048.18. Britain’s FTSE 100 climbed 0.4% to 5,874.37.

Below you can find some of the most notable stocks to watch today.

Daqo New Energy Corp. (DQ) – Last Close:  $100.94
We know…quite a pricetag. But, solar energy in China has an opportunity for massive growth. Beijing unveiled a budget for solar subsidies. Since those subsidies were announced, the stock has done nothing but climb. It was $51 on May 1st.
Churchill Capital Corp. IV (CCIV-UN) – Last Close:  $10.03

Michael Klein is a phenomenal deal maker. His first SPAC deal, Churchill Capital Corp. I, merged with Clarivate a year ago and the stock has done well. Plus, Klein’s Churchill Capital Corp. III just announced a deal with Multiplan. Klein knows what he is doing and often gets favorable terms.

Boingo Wireless, Inc. (WIFI) – Last Close: $13.28
We continue to look for 5G value stocks and WIFI fits that mold. We are ahead of widescale adoption and we are bullish on this WiFi wholesaler as a winner when installations do ramp up.
Boyd Gaming Corporation (BYD) – Last Close: $26.78
 
Penn National and Draftkings have gotten a lot of news this week, but BYD has nice Las Vegas leverage and plenty of games to interest those who want to spend their money. The stock has added $2 over the last month.

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