Thursday, 2 Dec 2021 Additional Notes: What Stocks We're Looking At

Thursday, 2 Dec 2021 11:20 AM EST

Stocks mentioned: AAPL, PFE, F, GOOGL, AMD, BA, SWKS 

• Apple (AAPL): It has been an outperforming star in the market carnage lately. Until today. Bloomberg reported slowdown with Apple iPhone 13, citing source to be a supplier of Apple. Here is what you need to know: no Apple supplier would EVER tell the media that Apple sales are weaker, they will get punished. On a different note, Wedbush just upgraded Apple, seeing $3 trillion market cap—says iP 13 much stronger than expected. We're looking to buy some today.

• Omicron: developing worst case scenarios, on Feb 26 of 2020, when Pence was designated Covid task force head, Trump pronounced the pandemic “contained.”  Dow stood at 27,000. One month later it was at 18,000. Omicron right now seems to be able to attack those who have had Covid, that’s 50 million. JPMorgan equity strategists going with theory that omicron is more viral, but less virulent (think cold vs. pneumonia). Pfizer (PFE) anti-viral may be best hope against Omicron, given we can't get vaccination above 70%.

  • Ford (F): downgraded this morning by Wolfe Research. Analyst prefers GM because ... Ford up too much (122%) year to date. Being up too much is not a good reason to sell; own GM if you want but please don't sell F because of this reason. For a 10x forward multiple, company is expected to earn 1.9$ EPS in 2022, so 2021 price target for the stock should be 19$/share. 2023 estimated to earn 2.6$ EPS, so 2022 PT is 26$/share. 

  • Alphabet (GOOGL): UBS starts with buy rating and  $3925 price target.... up from $3190 previous target...cites cloud tailwind. We have to announce that because we recently changed broker, we no longer could own fractional shares of Google and Amazon (before we owned fractional shares). Moving forward we no longer own these two names. We encourage subscribers to still own them, we just cannot, which is unfortunate.

  • Advanced Micro Devices (AMD): stock just pulled back to 20-day moving average. We're underweight in this name, would look to buy just a bit more here. Much more room on the downside, so please be nimble and ready to buy more on the way down.

  • Boeing (BA): China clears 737Max to fly again. China is the biggest customer for 737Max. This approval should bring new orders. Surprisingly, stock is still at 2021 lows. Are we expecting travel to plummet to 2020's low? No way! We're working on adding this name to our portfolio (again).  

  • Skyworks Solutions (SWKS): nothing on the fundamental side has changed since we initiated this name here. However, stock price has gotten cheaper. Time to buy. Trades at 13x forward PE. 2022 forecasted to earn 11.56$/share. Competitors Broadcom (AVGO) trades at 18x forward, NXP Semis (NXP) trades at 18x forward, Analog Devices (ADI) trades at 25x forward. So give Skyworks a 15x forward multiple (based on 2022 earnings) and the stock should be at $173/share (15% increase expected by year end).