Are These Top Cyclical Stocks On Your Watchlist This Week?
As investors wonder why are stocks up today, cyclical stocks could be worth considering in the stock market now. Why? Well for investors looking to buy on the dip, cyclicals would be a go-to now. After all, with a blazing hot economy and the Federal Reserve’s latest policy decision due today, the sector would be under pressure. Regarding the latter, investors will likely be watching closely to see how much the Fed will be raising its benchmark interest rate. Following soaring consumer and producer price figures from May, there are growing mentions of a 75 basis point increase. Should this be the case, it would mark a first since 1994.
All in all, even as the Federal Reserve looks to address inflation, cyclical firms continue to power forward. Take energy industry goliath BP (NYSE: BP) for instance. As of today, the company is acquiring a 40.5% stake in the Asian Renewable Energy Hub (AREH). Through its latest move, BP notes that it will oversee major parts of the development of the project. Also, BP believes it could “be one of the largest renewables and green hydrogen hubs in the world.”
On the whole, other oil industry titans such as Exxon Mobil (NYSE: XOM) are also gaining momentum as oil prices rise. So much so, that even President Joe Biden recently highlighted the need for such firms to bolster their oil refinery output. At the same time, you also have firms like Apple (NASDAQ: AAPL) and Netflix (NASDAQ: NFLX) actively optimizing their consumer discretionary offerings as well. Both of which are expanding their streaming portfolios with new types of content. Should all this have you keen on cyclical stocks, here are three more to know in the stock market today.
Cyclical Stocks To Watch Today
- Baidu Inc. (NASDAQ: BIDU)
- QUALCOMM, Inc. (NASDAQ: QCOM)
- Snowflake Inc. (NYSE: SNOW)
Baidu Inc.
First off today, we have the global technology corporation Baidu. In short, the company specializes in internet services and artificial intelligence (AI). In fact, it is one of the few firms in the world that offers a comprehensive AI stack. Its infrastructure includes AI chips, a deep learning framework, fundamental AI capabilities, and an open AI platform. Baidu also integrates cutting-edge AI capabilities into its goods and services, as well as unique application cases.
Today, Baidu is in talks to sell its controlling stake in iQIYI (NASDAQ: IQ) a Chinese video streaming service firm. During the COVID-19 lockdowns, China’s online video market boomed, and iQIYI became one of the largest players in China’s video streaming market. Baidu, which owns 53% of iQIYI and more than 90% of its shareholder voting rights, plans to sell all its holdings. In total, the deal could value all of iQIYI at about $7 billion.
This divestment plan is made so that Baidu can focus more on developing its AI and autonomous driving units. Last week, JIDU, an electric vehicle company backed by Baidu, released a concept “robocar”. Xia Yiping, the chief executive officer of JIDU, said, “The transition to this new era is marked by the shift of driving power from humans to AI, with robocars ultimately achieving self-generating progress led by AI.” Following all of this, would you be watching BIDU stock?
Qualcomm Inc.
Following that, we have Qualcomm, a cyclical company that creates semiconductors, software, and services related to wireless technology. In fact, it is a global leader in developing and commercializing foundational technologies that are used in today’s wireless products. It also licenses its intellectual property portfolio, which includes certain patent rights to manufacture and use certain wireless products. Today, the company won its bid to topple a $1 billion antitrust fine from the European Union.
In detail, it was alleged that Qualcomm has been pressuring Apple to only buy its 4G chips, after judges said regulators made a series of blunders in their case. The 2018 fine on the company came after years of scrutiny from the EU. The commission says that it will carefully study the judgment and its implications. It will also reflect on its possible options moving forward. QCOM stock is up by over 1.7% on today’s opening bell in light of this piece of news.
On Monday, the company also announced that it has acquired Cellwize Wireless Technologies, a leader in mobile network automation and management. This acquisition will help accelerate Qualcomm as a leader in 5G Radio Access Networks (RAN) innovation and adoption. Cellwize’s 5G network deployment, automation, and management software platform capabilities will also further strengthen the company’s infrastructure solutions to fuel the digital transformation of industries, power the connected intelligent edge, and support the growth of the cloud economy. Given this piece of information, is QCOM stock worth investing in right now?
Snowflake Inc.
Last on this list, we have the cloud computing-based warehousing company Snowflake. The company provides a cloud-based data storage and analytics service, named as the Data Cloud. In summary, it is a network of thousands of organizations mobilizing data seamlessly across public clouds as data consumers, providers, and service providers. Accordingly, Snowflake provides services to the government, financial services, education, and technology sector among others.
Recently, analysts at Canaccord Genuity Group upgraded Snowflake from a Hold rating to a Buy rating. Analyst David Hynes Jr. says that he raised his rating to Buy and also kept his price target of $185 for Snowflake. Following its financial results of the first quarter of 2023, the company’s revenue for the quarter was $422.4 million, representing 85% year-over-year growth. In the meantime, product revenue of $394.4 million in the first quarter, representing 84% year-over-year growth. Its net revenue retention rate was 174% as of April 30, 2022. In particular, the company now has 6,322 total customers and 206 customers with trailing 12-month product revenue greater than $1 million.
Yesterday, the company announced that it is expanding native Python support and data access to advance programmability in its Data Cloud. These new enhancements will help data scientists, data engineers, and application developers to improve productivity. Snowflake’s latest innovations bring Python to the forefront, with the launch of Snowpark for Python, now in public preview, and a native integration with Streamlit for rapid application development and iteration. Considering the positive outlook, do you have SNOW stock on your watchlist?
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