“Strong Buy” Recommendation for UBER TECHNOLOGIES Collaborative Transport Company UBER Symbol on the New York Stock Exchange

highlights

• The stock markets recorded an optimistic week against the background of the continued launch of the vaccines and according to Pucci, by April every American will be able to get vaccinated
• 82 S&P 500 companies reported their business results last week
• Basic inflation remained unchanged in January, indicating that Fed policy will remain ionic
• The financial reporting season on Wall Street continues, with the results published, among others: AIG, Baidu, Tower, NICE, Nova.

The technical arena – recommendations for the coming week

The global arena

The stocks continue in the positive trend and especially in the small stocks

The major indices recorded a second week of gains and reached record levels. These have apparently been supported by the accelerated spread of corona virus vaccines and a moderation in a number of cases in the US. Amazon and Tesla weighed heavily on the periodic consumer goods segment, with medium and small stocks widening their gap this year, compared to “large stocks.” Value stocks also performed well, with major indices moving in a narrow range, for most of the week.

This week saw the last big wave of fourth-quarter report releases, with 82 of the companies included in the S&P 500 reporting results. The overall profits of the S&P 500 companies grew slightly, compared to their level a year ago, and mark a particularly rapid recovery in profits compared to previous recessions. For example, after the global financial crisis of 2008-2009, the S&P 500 took five years to return to earnings per share. About four out of five companies in the index have so far topped the earnings forecast, well beyond regular quarters.

Powell signifies a commitment to low rates

The projected earnings multiplier in the U.S. stock market is high and the gap is well above the long-term average. This situation becomes less convenient for investors and this is sometimes expressed in sentiment. Federal Reserve Chairman Jerome Powell took care to reduce those concerns on Wednesday, speaking to the New York Economic Club and reiterating policymakers’ determination to keep interest rates close to zero and continue to buy $ 120 billion in monthly assets. Many argue that interest rates Very low values ​​justify higher valuations because of the higher value they give to future earnings (low discount rate) .Low bond yields also support the relative advantage of stocks.

Powell’s ionic monetary stance also appears to have been supported by inflation data released this week. The consumer price index (excluding food and energy) remained unchanged in January, below the consensus for a 0.2% increase. Weekly unemployment claims fell to 793,000, but that was only because the previous week’s balance sheet was revised higher, from 779,000 to 812,000, and was higher than expected. The University of Michigan’s initial index of consumer sentiment in February surprised downward. If approved, it would be the lowest reading (76.2 points) since August.

Europe

Yields on government bonds in the eurozone rose on a weekly basis, but rather weak inflation, the ionic approach of the European Central Bank (ECB) and the gloomy economic forecast of the European Commission (EC) created some pressure for declining yields.
The easing of political tensions in Italy helped a 10-year yield in the country to a new low on Friday. Mario Draghi, the former president of the Central Bank, is expected to become prime minister of Italy after receiving the support of the populist 5-star movement, the largest party in parliament, for the formation of a national unity government.

Germany extends its lock

European countries continued to extend their closure periods, despite advances in vaccines. 16 German governors and Chancellor Angela Merkel have extended the country’s lock until March 7, amid fears that the mutations will lead to an increase in the number of infected. Germany also decided to close its border with the Czech Republic. In the UK, Prime Minister Boris Johnson plans to outline a plan to reopen the economy in two weeks. AstraZeneca has announced that it aims to be an effective vaccine against the mutations and ready for large-scale deployment within six to nine months.

Economic weakness in the UK and the eurozone

The UK economy contracted by 9.9% in 2020 – the sharpest annual fall since 1709 – according to the Office for National Statistics. Output has grown at a rate in excess of 1% in the last three months of 2020 due to increases in government spending and capital investment. In contrast, the Bank of England forecast a sharp contraction in the first quarter of 2021 due to continued lockout limits, followed by a sharp recovery around the middle of the year due to the rapid launch of the national immunization campaign.
The EU predicts that the eurozone economy will grow by 3.8% this year and in 2022. The forecast for 2021 is lower than the previous forecast published at the end of last year, but the forecast for 2022 presents an upward update.

The technical arena

Cisco (CSCO , $ 47.29)

Technology company Cisco, presented its results for the fiscal quarter that showed ongoing struggles in its core product segment. Still, the company’s results topped analysts’ estimates. This is what the company did:
Earnings: 79 cents per share, adjusted, compared to 76 cents per share expected by analysts.

Revenue: $ 11.96 billion, compared to expectations of $ 11.92 billion.

Cisco revenue declined slightly in annual terms in the quarter, which ended Jan. 23, according to the report. Revenue has been declining for the fifth consecutive quarter. The weak economy has reduced the company’s growth prospects.

In the company’s leading products segment, infrastructure platforms, which include network switches and network data exchanges, Cisco generated revenue of $ 6.39 billion, down 3% from a year ago.
Cisco CEO Chuck Robbins said: “The corporate market remains weak, driven by long-term business cycles and curbing spending, among a number of customers affected by the epidemic. He added that while revenues from switches were stable, revenues from routers and servants fell.

The company’s application unit, including Webex video calling products, generated revenue of $ 1.35 billion, up from a year ago and slightly below the consensus estimate. Webex now has an average of 600 million users over the quarter, Robbins said.
Technically, the stock is in a strong buying position for the coming week. The momentum indicator is positive. The support line is at $ 34.67 and the resistance line is at $ 52.55.

Uber (UBER, $ 60.63)

The cooperative transportation company, Uber Technologies, reported last week its financial results for the fourth quarter and also for the full year ended December 31, 2020. Key financial points for the fourth quarter 2020 were:
The value of gross orders increased by 16% compared to the previous quarter to a level of $ 17.2 billion, but a decrease of 5% compared to the corresponding quarter last year.

Revenue grew by 13% in the quarter but decreased by 16%, compared to the corresponding quarter last year.

The net loss attributable to Uber Technologies, Inc. Stood at $ 968 million, including $ 236 million in share-based compensation expenses.
EBITDA loss (adjusted) of $ 454 million was reduced by $ 171 million compared to the previous quarter and $ 161 million compared to the corresponding quarter a year ago.

The company’s CEO said in a statement after the announcement: “While 2020 has certainly tested our resilience, it has also dramatically accelerated our capabilities in local commerce, with our shipping business more than doubling during the year and totaling an annual ordering rate of nearly $ 44 billion (By December).

Last August, Uber Technology acquired Autocab, which connects drivers to local taxi operators. According to the company’s CEO, when travel and tourism recover, the demand for taxis will skyrocket again.
Technically, the stock is in a strong buying position for the coming week. The momentum indicator is positive. The support line is at the level of $ 24.27. The resistance line is at the level of $ 66.78.

twitter (TWTR, 71.90 dollar)

The social networking company, Twitter, reported its quarterly earnings. Here are the key points:
Earnings per share: 38 cents, adjusted, compared to the expected 31 cents.

Revenue: $ 1.29 billion compared to the expected $ 1.19 billion.
Daily Active Users (mDAU): 192 million compared to 193.5 million expected, according to StreetAccount.

Looking ahead, Twitter said it expects revenue to grow faster than spending in 2021, assuming that the improvement in the epidemic continues and has only a “modest impact” due to the privacy changes Apple is expected to take on its new operating system, the ios14.
The company reported that it expects growth of more than 20% in the number of users this year, with total expenses increasing by more than 25%.

As for 2021, Twitter also noted that despite the “exceptional circumstances” in the first quarter, the rise in mDAU by the end of January was above average over the past four years. It is possible that this figure was a reference to the company’s decision on January 8 to permanently suspend the account of former President Donald Trump.

Technically, the stock is in a buying position for the coming week. The momentum indicator is positive. The support line is at the level of $ 30.73. The resistance line is at the level of $ 79.53.