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Cybersecurity is more vital than ever, and there are some excellent stocks when it comes to investing in this sector.

But one company that we love in this industry right now is a cloud-based security firm, called Zscaler. Their goal is to expand protection beyond their client’s physical locations. They have 150 data centers and claim to manage over 150 billion transactions a day and stop 7 billion security incidents.

They have been very successful in the larger enterprise market. Having over 5,000 customers, and 500 of those being in the Forbes Global 2000. They have done a great job of diversifying internationally, around half of their revenue is international. They are growing very quickly. Over 50% revenue growth y/y in the past two of quarters, 122% net dollar retention.

One of their strengths, is that the company’s upselling number is very impressive. They put their current total market to be around 335 million possible users, which would mean their yearly revenue is at around $72 billion of annual revenue. That is only including what they provide today, they say there are other opportunities they might pursue, like Internet-of-Things. Then there are B2B applications, which is a market that will get much bigger over time.

Their very engaged founder and CEO Jay Chaudhry, who is still leading the business, owns a large 20% stake, plus another 20% stake using family trusts. Meaning he is very highly invested in the company’s success.

Zscaler is not a cheap stock, being at around 40 times sales, but when you research their numbers, the company sticks out as a well justified buy for anyone wanting to profit from cybersecurity.

Author: Scott Dowdy

Cryptocurrency is having a big year. While the largest names in crypto like Bitcoin and Ethereum are getting most of the news, there are many new cryptocurrencies.

Among them is SafeMoon, which started in March and has already gotten over 2 million buyers.

It’s CoinMarketCap page is the fifth-most-visited page on the price-tracking platform. Based on these rankings, SafeMoon is now searched more than Ethereum, which is one of the top cryptocurrencies.

Although SafeMoon is making waves, that alone does not mean it’s a smart investment. Here is what you should know about the new trendy cryptocurrency.

What is it?

Safemoon is different from other cryptocurrencies because holders are charged a 10% fee if they decide to sell their tokens.

The reason for this is to encourage holders to keep their tokens for a longer time. In theory, that could lower SafeMoon’s volatility, because there will not be as many traders buying and selling.

Every time a person sells SafeMoon and pays their 10% fee, a part of that money is given to other SafeMoon holders, and some of it is removed permanently. So as more holders sell SafeMoon, there is less supply available. SafeMoon’s designers believe this scarcity will mean an increase in the crypto’s value.

Is it really safe?

Every cryptocurrencies has some risks, but SafeMoon is among the riskiest since it is new. And to survive long term, it needs more acceptance among businesses and better security.

If you decide to invest in SafeMoon, make sure to look at your personal tolerance for risk. If you have cash to lose and are willing to gamble, you might be able to make some money from this interesting new cryptocurrency that is gaining popularity very quickly.

Author: Steven Sinclaire

Wall Street’s top investors keep coming out to warn traders against putting all their money in meme stocks like AMC Entertainment (AMC).

Chad Beynon, a Macquarie analyst, along with his team, restated their $6 price goal (the cost of one AMC ticket is around $14) and Neutral score for AMC on Thursday.

While the group applauded the company’s CEO for embracing the enthusiastic trading and voiced optimism on a box office return, the team of analysts were still concerned about AMC’s balance sheet.

“Despite shares being higher by 2,850% ytd compared to the S&P 500’s 12%, the company’s balance sheet is still weighted down by almost $5.5 billion in debt as of the first quarter of this year and our estimated leverage is 12.3x by the end of 2022. AMC should benefit from the return of theater demand, which is greatly needed for the company to deal with deferred rent ($450 million+) and high interest (~$420 million),” said the analysts in a note.

The team believes AMC will lose almost $2.5 billion between 2021 and 2023. But, the note continued on to say those estimates are “under review.”

AMC fell 31% on Thursday after an almost 100% increase on Wednesday after renewed interest for meme stocks. The pullback comes after a disclosure by the company that it will give 11.5 million new shares — as the CEO aims to capitalize on the stock’s increase — to raise funds for various corporate plans.

Author: Steven Sinclaire

Tesla (TSLA) gets a lot of attention from stock investors. When news hits about the EV pioneer, people react fast — and its moves can affect the whole market.

Thursday was a weak day for Wall Street, as enthusiasm for meme stocks turned into nervousness about recent gains being unsteady. Losses for the Dow, S&P 500, and Nasdaq were not great, but a surprise announcement from Tesla during the day seemed to rock the market’s sails and might point to troubling times ahead not just for Tesla but for overall markets.

Tesla double trouble

Tesla shares lowered by over 5% on Thursday. The shareholders of Tesla were forced to face a couple of problems that might threaten the EV company’s leadership spot.

Early on Thursday, Tesla announced a couple of recalls. One covers around 5,500 Model Y and Model 3 vehicles, as the car maker moves to make sure that fasteners holding the seat belts for front-seat riders are securely attached. A second recall is for around 2,200 Model Y SUVs, and will involve a similar issue that might possibly affect seat belts in the vehicles’ second rows.

Those announcements come after Tesla put out another recall earlier in the week. The concerns there were about brake caliper systems that might come loose and lead to tire pressure loss, and is connected to almost 6,000 Model Y and Model 3 vehicles.

More harmful issues that Tesla must contend with involves a report that the company’s order volume from China was lower by around half in May from its April levels.

Citing sources inside the company, the report said that Chinese orders for Tesla vehicles lowered to 10,000 vehicles, down from 18,000 vehicles in April and 21,000 from March.

This certainly calls into consideration if Tesla is maintaining its competitive edge overseas.

In China, the company faces lots of competition from domestic car makers like XPeng (CPEV) and NIO (NIO). Having made a Gigafactory in Shanghai, Tesla is hoping for and relying on high demand for its vehicles in China. If that demand does not come as expected, it might lead to huge implications for the company’s growth not just in China, but throughout the whole Asia region.

Author: Steven Sinclaire

While we are still fighting the pandemic, the marijuana boom is growing the industry in leaps and bounds. And that is helping U.S. based cannabis producers generate more profits. Let’s talk about how 2021 is shaping up for two of these companies and why I think they could have the incredible potential of being millionaire makers.

Curaleaf

Smart acquisitions have driven Curaleaf’s great revenue increases. In Q1 of this year, revenue reached $260 million, which is higher by 170% y/y. The company got a boost in wholesale and retail revenue. The 231% increase in retail put the company at $188 million and was especially great. This can be linked to the organic growth among its stores and six new stores across Maine, Florida, and Pennsylvania. The firm had a total of 102 locations at the end of Q1, and even made sales in Arizona, where marijuana was legalized in January.

Curaleaf’s Select brand, a brand of cannabis oil that it purchased from Cura Partners in Feb. for $948.8 million, led to the 254% increase in wholesale to $72 million from last year. Curaleaf is not yet profitable, but many of its purchases in 2020 — including dispensaries and cannabis manufacturers, like Curaleaf NJ, Blue Kudu, Arrow, Remedy, MEOT, and Alternative Therapies Group — have yet to reveal their full potential. These new assets will help increase revenue and profits even more in the years to come.

Trulieve Cannabis

Trulieve Cannabis got a lot of attention with its choice to buy Harvest Health, which gives the firm a strong foothold in the growing marijuana market in the Southeast, Northeast, and Southwest. This agreement, subject to approval, will add vital markets like Pennsylvania, Arizona, and Maryland to the company’s roster. They expect to produce around $1.2 billion in revenue and about $461 million in adjusted EBITDA this year with the aid of this purchase, which gives the company access to 126 dispensaries across 11 states.

Trulieve has shown a great start to 2021, recording impressive revenue growth of 102% y/y to $194 million in its first quarter. Its grip on the state of Florida, where it maintains 78 dispensaries, founded its growth. Also for Q1, adjusted EBITDA was recorded at $91 million, up 87% from last year despite expenses rising to $57 million from $29 million. Management’s expansion path led to the increase, but its positive EBITDA shows it is able to grow while also managing its costs. Meanwhile, net profits clocked in at $30 million, a 27% boost from last year.

Trulieve expects to have revenue between $815 million to $850 million for 2021. Along with adjusted EBITDA between $355 million and $375 million.

Author: Scott Dowdy

With inflation increasing, gold is an attractive portfolio hedge. Meanwhile, silver and especially copper is also attractive, according to a top researcher.

In an interview, Robert Ryan, the current leading strategist at BCA Research, said his company is bullish on the yellow metal in the long-term as the Fed seeks to maintain its very loose policies in reaction to rising inflation.

The statement comes as gold has been going steadily up, pushing over $1,900 per ounce.

Meanwhile, copper pulled back from its record high at the beginning of May and silver is also getting relatively weak numbers.

However, Ryan says investors should not ignore these two, as he believes we will see heightened prices through the year as demand stays strong.

Ryan is especially bullish on copper and says the metal will keep seeing a large supply/demand imbalance that might last for years. Ryan said that miners will be forced to spend a huge sum of money to increase their operations, and it will take some time to get their operations going.

Ryan continued to say that new tax structures in crucial mining nations like Chile and Peru create more obstacles for companies seeking to create new projects.

“Currently, there is not an easy fix to expand the copper supply to meet the demand right now,” Ryan said. “Copper is required in every sector of the economy.”

Ryan predicted that copper could push over $5 per pound in the current environment. He continued to say that prices have risen to bring in more supply to the market.

Author: Steven Sinclaire

Many critics say the current bitcoin (BTC) price of $35,000 or so is already too much. They stress that the lack of real-world uses for Bitcoin as evidence of it being just a Ponzi scheme.

But the reality is it is already in heavy use as a value store, and this founding utility of bitcoin might mean its price goes to $1 million per coin.

Inflation

Bitcoin is often said to be the “digital gold,” but the issue is more complicated. Gold has been the preferred value store from a monetary perspective, but other assets have also been alternative stores under the fiat standard.

When a currency is inflationary, people seek alternative investments — like stocks and real estate — to get around the depreciation of their money. Cryptocurrencies are now among these alternative value stores, and they could disrupt some of the other assets.

Getting to $1 million

Although there are around 6.25 new bitcoins given by miners every ten minutes or so, the total amount will cap at 21 million. Because of this, a $1 million bitcoin per-coin price would mean a total value of $21 trillion.

Is that a realistic number? Let’s look at other markets that bitcoin might disrupt as a value store.

The size of the overall bond market was estimated at $119 trillion. Yields earned those bonds are at or close to all-time lows. Around $18 trillion worth of those bonds give negative yields.

So let’s imagine that investors of 10% of the global bond market (which comes to $11.9 trillion) want to switch to bitcoin. They can’t at current prices because there are less than $1 trillion of bitcoin in existence and only some of bitcoin’s supply is available to be bought on exchanges. In other words, these bond holders could not purchase that amount of bitcoin, meaning the price they pay for their bitcoin on exchanges would need to greatly increase to complete their buy orders. It is a simple demand and supply issue.

Another one: let’s imagine one fourth of the gold market switch over to bitcoin. That would equal an additional $3 trillion of buying pressure. Say two percent of the $300 trillion global real estate and equities market goes into bitcoin, that is another $6 trillion.

With these changes, you could see around $20.9 trillion worth of possible buying pressure. The opportunity here could be exponential.

Author: Scott Dowdy

Bitcoin investors who are wanting an end to the long pullback in prices for the top cryptocurrency might be forced to wait longer, says J.P. Morgan strategist Nikolaos Panigirtzoglou.

“We argued before that bitcoin’s failure to break higher that $60k would see more bearish trend and create more position unwinds, and that was possibly a large factor in the correction in the past week in pushing commodity trading advisors and others to lower their positions. The long-term data is an issue, as it has not yet turned short. It would still take declines to $26k before long-term momentum would mean capitulation,” said Panigirtzoglou in a new message to clients.

Bitcoin had another difficult weekend. Prices went into Saturday at around $36,311, and fell be as low as $33,633. By Monday night, bitcoin went back to $36,833. And Tuesday cryptocurrencies were keeping their volatility.

Crypto was crushed in May due to many reasons. From negative tweets from Elon Musk to fears of incoming government regulation from China and possibly the U.S.. Bitcoin prices lost around 37% in May, and are lower by 43% from their mid-April high of $64,829.

Panigirtzoglou predicts medium-term fair value for the digital currency between $24,000 to $36,000.

The analyst believes that the May free-fall has hurt institutional demand, which might keep prices suppressed for now.

“There is not much doubt that the boom and bust cycle of the previous weeks mean a setback to institutional investment in crypto and especially in Bitcoin and Ethereum. The mere increase in volatility, certainly relative to gold, is a roadblock to greater institutional adoption as it lowers the attractiveness of cryptocurrencies vs. gold in institutional portfolios,” Panigirtzoglou said.

Coinbase CFO Alesia Haas stated that the pressure on prices should remind investors of the risk in the volatile sector.

“I believe new investors have underestimated the risks in cryptocurrencies. This market is volatile, and we must remember this is a very young sector. So while we have witnessed high volatility, we have been seeing this since the very start,” Haas said.

Author: Scott Dowdy

 

The world’s largest meat company, JBS Foods, has announced it was hit by a ransomware attack.

On Monday, the company said, “JBS USA determined it was targeted by an organized hack, affecting some of our servers supporting our North American and Australian systems… solving the incident will take time, which might delay some transactions with customers.”

On the CME, futures decreased by more than 3%, before regaining some of their losses, as traders try to handicap the possible disruption to the American food supply while reports are being made that JBS could be shutting down some of its operations in the U.S. and Australia. And on Tuesday, there were news reports of facilities already being taken offline.

The Biden Administration is also seeking to work with the FBI and the USDA to watch the situation.

“USDA has contacted numerous large meat processors in the country to guarantee they are aware of the problem. We are watching any changes on supply and the President has asked his team to determine what can be done to stop any further impact” said Karine Jean-Pierre, principal deputy press secretary.

She also said the hackers were likely based in Russia.

“JBS notified the Biden White House that the attack came from a criminal group possibly based inside Russia. The White House is working with the Russian government on this issue and giving the message that responsible nations do not protect criminals,” she stated.

If the JBS hack is not solved soon it might cause very tight supplies of beef and pork and higher prices for restaurants. It might also lead to shortages like we saw at the start of the coronavirus pandemic. Worst case: restaurants limit supply and we go through shortages.

JBS is the latest company to be targeted by a cyberattack after the Colonial Pipeline was also hit by such an attack by a Russian hacking group called DarkSide.

Colonial Pipeline Company is the largest fuel pipeline in the nation and was forced offline due to the hack, leading to gas shortages and panic buying.

The company’s CEO reported that they paid the $5 million ransom to release its systems and get fuel going again.

Author: Steven Sinclaire

Bitcoin was nearing its largest monthly decline ever as May ended.

Bitcoin, the number one cryptocurrency by capitalization, ended under 36% for the month of May at $36,509. A finish under $34,885 would have been the cryptocurrency’s worst monthly decline ever.

Bitcoin prices were under pressure in the month as investors worried about the crypto-market facing more scrutiny from officials in the U.S. and China.

Federal Reserve Chairman Jerome Powell proposed the potential for the central bank to create its own digital currency and was seeking ways to increase regulation. The IRS said cryptocurrency moves of over $10,000 should be reported to the agency.

Meanwhile, Chinese officials took steps to restrict bitcoin and other cryptos. They announced their program to limit bitcoin mining and trading and the nation’s banking association warned banks to not transact in cryptocurrencies. China is attempting to create its own digital currency, the digital yuan.

Talk of more regulation comes as Tesla Inc. reversed its program of accepting bitcoin as payment for its products, citing environmental worries.

Bitcoin reached a record high in April of over $63,500 per coin, fueled by the move by some U.S. companies to start investing in the cryptocurrency to diversify their portfolios.

Business software provider MicroStrategy Inc. put over $2.2 billion into bitcoin while Tesla has put in around $1.5 billion.

Author: Steven Sinclaire

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