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PreMarket Prep Recap: The IPOs Of 2019 Disappoint

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PreMarket Prep Recap: The IPOs Of 2019 Disappoint

Earnings reports were featured on Tuesday's PreMarket Prep Show. Although there weren't many big names, there were some big moves.

What You Don't Want To Say On An Earnings Call

After the close on Monday, Uber Technologies (NYSE: UBER) posted a narrower than expected loss but came up shy on sales. The EPS beat was the catalyst for quick move above the pair of highs from Friday ($31.70) and Monday ($31.75), up to $32 before sellers engulfed the issue.

In this market environment, growth stocks that lose money can tread water as long sales are growing at a reasonable pace, which was not the case for Uber. Also weighing on the issue were comments from the company that it's now on track to profitability on an adjusted EBITDA basis until 2021.

For investors still attempting to pick a bottom in the issue, the hosts of show noted the importance of the issue not making a new all-time low ($28.31). The issue exceeded that low and is drifting towards $28.00.

An Exercise Bike With A TV?

Peleton (NASDAQ: PTON) reported better-than-expected sales but whiffed on EPS. When the issue was being covered on the show, the Street was putting emphasis on the sales beat and had the issue above its all-time closing high (from its first day of trading) at $25.76.

Co-host Dennis Dick made an analogy of the company to GoPro (NASDAQ: GPRO), the company that created a "camera on a stick" and went public in 2014 at $28.65, peaked at $98.47 in October and now trades under $5.

The analogy being Peleton was simply an exercise bike with a built-in television. The issue began to fade in the pre-market session and was unable to go green in the regular session. The retreat off the open breached the pair of lows at the $23.60 area from Friday and Monday, falling to $22.35 before mounting a rebound back into the $23.00 handle.

WWE Attempts To Get Off The Mat

In non-earnings news, World Wrestling Entertainment (NYSE: WWE) announced after Monday's close that the company had expanded its live event deal with the Saudi General Entertainment through 2027.

The issue fell more than $10 last Thursday following its earnings report. The issue went on to make a new low for the move on Monday at $52.69 and closed at its lowest level ($53.16) since April 2018.

With so many investors pinned down in losses after the report, the hosts of the show were skeptical of how far it would rebound. It was noted that it was crucial for the issue to clear Friday's high ($57.74) for the rally to continue. At this time, it has reached $57.54, but still remains in the lower $57 handle.

Nic Chahine Joins The Show

Midway through the show, Nic Chahine, author of the Create Income With Option Spreads, joined the crew with his take on the recent and why he's sticking with his Uber long.

On Wednesday's show, Tim Courtney, CIO of Exencial Advisors will be our guest to share his outlook for the market for the remainder and in 2020.

Posted-In: PreMarket PrepLong Ideas Short Ideas Trading Ideas Best of Benzinga

 

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