Stocks - r/Stocks Daily Discussion & Technicals Tuesday - Aug 25, 2020 |
- r/Stocks Daily Discussion & Technicals Tuesday - Aug 25, 2020
- Less than 10 years ago Exxon was the most valuable company in the world. Today it got booted off the DJI
- iPhone sales steady while global smartphone sales tank 20% in Q2
- NIO
- BigCommerce Teams Up with Facebook to Unlock Checkout on Instagram Feature for US Merchants
- NIO UP 19%!!!
- Holding stocks over the election?
- V or PYPL?
- Salesforce (CRM) Q2 results -- stock up nearly 12% after-hours.
- MSFT Bull Run❤️
- SLV- Fed Announcement Thursday, What's the protocol?
- Has anyone got a portfolio for Plant Based/Lab Grown Meat?
- When does one trim their portfolio?
- As an owner of 1087 shares of Camber Energy, Inc. (CEI), what does this mean for me once (if) this merger goes through?
- AirBnB booming or just bs to raise the IPO?
- Thoughts on Roth Stock Picks
- Average up or sell then buy back
- How will Alibaba stock be affected if Alipay IPO price soars
- Question: What is the difference between stocks in a company that are listed in multiple markets, like SNE (NYSE) and 6758 (TYO)?
- Wanted to invest in the market, took advice from a financial advisor, ended up losing almost 5700$
- ZNGA: future mobile games leader?
- $SPY puts are really calling my name right now
- Everyone sees that Dow Jones is changing up. Here’s an educational post explaining how the Dow and SP500 works.
- COTY earnings pre-market this Thursday. New CEO starts on 01 SEPT. Will COTY bounce?
- HPE: Transition to As-a-Service and Path to All-Time Highs
| r/Stocks Daily Discussion & Technicals Tuesday - Aug 25, 2020 Posted: 25 Aug 2020 01:06 AM PDT This is the daily discussion, so anything stocks related is fine, but the theme for today is on technical analysis (TA), but if TA is not your thing then just ignore the theme and/or post your arguments against TA here and not in the current post. Some helpful day to day links, including news:
Technical analysis (TA) uses historical price movements, real time data, indicators based on math and/or statistics, and charts; all of which help measure the trajectory of a security. TA can also be used to interpret the actions of other market participants and predict their actions. The main benefit to TA is that everything shows up in the price (commonly known as "priced in"): All news, investor sentiment, and changes to fundamentals are reflected in a security's price. TA can be useful on any timeframe, both short and long term. Intro to technical analysis by Stockcharts chartschool and their article on candlesticks If you have questions, please see the following word cloud and click through for the wiki: See our past daily discussions here. Also links for: Technicals Tuesday, Options Trading Thursday, and Fundamentals Friday. [link] [comments]  |
| Posted: 24 Aug 2020 03:03 PM PDT Just goes to show how much perceptions can change in a decade: Per WSJ: The Dow Jones Industrial Average is getting a makeover. S&P Dow Jones Indices, which manages the 30-stock benchmark, said it would add Salesforce. com, Amgen Inc. AMGN and Honeywell Inc. to the blue-chip index at the start of trading on Monday. Those three stocks will replace Exxon XOM Mobil Corp., Pfizer Inc. and Raytheon Technologies Corp, respectively. [link] [comments]  |
| iPhone sales steady while global smartphone sales tank 20% in Q2 Posted: 25 Aug 2020 01:11 PM PDT Global smartphone sales dropped 20.4% in the second quarter of 2020, according to data released Tuesday from Gartner. Apple posted a .4% decline in year-over-year smartphone sales, according to Gartner. In comparison, Samsung experienced the largest decline in sales in the quarter, 27.1% less year-over-year, according to the company. [link] [comments]  |
| Posted: 25 Aug 2020 10:19 AM PDT Seems like sky's the limit for NIO right now. Bought in at 14 a few days ago, currently at 17. Thoughts? Will the stock continue to climb? Seems like it's a pretty big competitor for Tesla in the Chinese market. Was going to buy more before it hits 18 tomorrow [link] [comments]  |
| BigCommerce Teams Up with Facebook to Unlock Checkout on Instagram Feature for US Merchants Posted: 25 Aug 2020 08:23 AM PDT BigCommerce merchants now have the ability to enable customer checkout directly within Instagram BigCommerce (Nasdaq: BIGC), a leading open SaaS ecommerce platform for fast-growing and established brands, today announced the availability of checkout on Instagram for eligible US merchants. BigCommerce merchants can be among the first to adopt the new feature, which provides shoppers an intuitive, seamless and secure way to purchase products they discover on Instagram in a few clicks, without leaving the app. Leveraging BigCommerce's native integration with Facebook Commerce Manager, merchants can easily connect their ecommerce storefront's catalog to Instagram and give customers the ability to buy from their favorite brands directly on Instagram—rather than navigating to a brand's website to make a purchase—and pay using PayPal, Visa, Mastercard, American Express or Discover. After placing an order, customers can also use the Instagram app to view their order status, estimated delivery date and tracking number, as well as cancel orders, initiate returns or request additional support. "Creating a streamlined checkout experience is paramount for merchants looking to social commerce to drive revenue growth. The rollout of checkout on Instagram is another significant step in Instagram's evolution toward becoming an essential commerce channel for customer-focused brands," said Brent Bellm, chief executive officer at BigCommerce. "BigCommerce is proud to be one of a select group of partners to offer their customers access to this innovative new feature at launch." https://finance.yahoo.com/news/bigcommerce-teams-facebook-unlock-checkout-150500474.html [link] [comments]  |
| Posted: 25 Aug 2020 01:01 PM PDT NIO is finally starting to take off and I hope it keeps going strong. I bought 115 shares a while ago at 14.50, so I'm holding on for the ride. What are your NIO price targets? [link] [comments]  |
| Holding stocks over the election? Posted: 25 Aug 2020 10:24 AM PDT What would be traders advice in holding stocks over an election? And also specifically the election soon to take place in the USA? In further detail, what would be your hypothesis for the effect on certain markets and/or industries? [link] [comments]  |
| Posted: 25 Aug 2020 12:52 PM PDT Looking to get into one of these two. V - stable, smaller PE, has a dividend, still seems to have room for growth PYPL - less stable, skyrocketed during COVID, no dividend, but seems like there is still a ton of room for growth given the extreme e-commerce boom. Both seem like really solid options to me, with PayPal being the higher risk/higher reward of the two. Which would you chose? [link] [comments]  |
| Salesforce (CRM) Q2 results -- stock up nearly 12% after-hours. Posted: 25 Aug 2020 01:37 PM PDT See more here: https://s23.q4cdn.com/574569502/files/doc_financials/2021/q2/CRM-Q2-FY21-Earnings-Press-Release-w-financials.pdf Really great quarter! [link] [comments]  |
| Posted: 25 Aug 2020 01:34 PM PDT Hey everyone, As MSFT inches closer to 217 per share, investors prepare to jump in for the new record highs. MSFT has been predicted to take off on another bull run as it surpasses its previous high and reaches a new upward trend in its cycle. Will you be buying Microsoft before this run? Do you feel it is about to take off for a nice jump? [link] [comments]  |
| SLV- Fed Announcement Thursday, What's the protocol? Posted: 25 Aug 2020 09:36 AM PDT Does it tend to run going up to the fed meeting or does it tend to run after the announcement is made? Trying to figure out if it's worth the risk to hold a $25c 28 AUG Call until Thursday. It's already down 50% and I need silver to hit about $25.30 or so to decrease my loss. [link] [comments]  |
| Has anyone got a portfolio for Plant Based/Lab Grown Meat? Posted: 25 Aug 2020 05:22 AM PDT So far my research has shown me that the vast majority companies in this sector are still in their infancy and are not yet publicly traded. They are either funded by private capital or have been financed by existing large cap food groups (e.g. Tyson Foods). The only interesting publicly traded companies which I can see so far are Beyond Meat and Agronomics. There are other companies that specialise in the technology or equipment, or something else tangentially related, but it seems difficult to get good exposure to a range of companies in the cultivated meat business specifically Has anyone been able to put something together in this sector, and if so would you mind sharing it? I wonder if it's just not too infant for retail at the moment [link] [comments]  |
| When does one trim their portfolio? Posted: 25 Aug 2020 10:23 AM PDT When do you guys decide when to trim your portfolio? What are some factors leading you to trim it? Like if you are heavily weighed on Facebook or Microsoft (which people keeps saying to hold for the rest of your life) is it even worth trimming? [link] [comments]  |
| Posted: 25 Aug 2020 11:55 AM PDT
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| AirBnB booming or just bs to raise the IPO? Posted: 25 Aug 2020 04:48 AM PDT Saw a bunch of articles this morning stating that AirBnB could be the deal of the century, as more and more people choose it over hotels. What do you think? Is it really going to be a good investment or is media just creating a hype? [link] [comments]  |
| Posted: 25 Aug 2020 12:28 PM PDT I'm 22 and just opened a Roth and can max out my $6000 contribution now. I've been thinking on stocks to buy. I'm thinking $1k on each of these. Thoughts? CSX UNP JPM BAC INTC MSFT All of these have doubled or almost over the past 5 years and payout a solid dividend. I feel like these can consistently deliver 12-20% returns over the next 10 years. [link] [comments]  |
| Average up or sell then buy back Posted: 25 Aug 2020 12:27 PM PDT Beginning investor here. Ive been getting some good returns on the EV industry. How do you know when to average up or just buy the shares back with the profit you earned [link] [comments]  |
| How will Alibaba stock be affected if Alipay IPO price soars Posted: 25 Aug 2020 01:52 PM PDT Alibaba is a major shareholder of Alipay, which is planning on going public soon. Theoretically if Alibaba owned 30% of shares of Alipay and Alipay's stock soared 100% in a year, would that have an affect on the price of the Alibaba stock itself? [link] [comments]  |
| Posted: 25 Aug 2020 01:44 PM PDT Is it as simple as they're the same stock traded in more than one market? [link] [comments]  |
| Wanted to invest in the market, took advice from a financial advisor, ended up losing almost 5700$ Posted: 25 Aug 2020 12:06 PM PDT Let me preface this by saying that I didn't know anything about investing. But, recently since i had some money sitting around, i decided to invest it. Obviously, i needed help. So i found a financial advisor and contacted him. He gave me some suggestions and I invested in the market. I invested close to $9000 in the market and lost alot of it(around 60%). I pulled out recently because i couldn't afford to lose any more money. I don't want to quit because of one just one bad incident but it has definitely left a bad taste in my mouth. I am doubtful whether the advice given by these 'financial advisors' is accurate Could there be some benefit for them to give us skewed advice? Now, instead of depending on others, i want to become self reliant in this world. I want to learn about finance and stock market from scratch . If you guys know any reliable sources that have been proven to work, I'd love to know about them. Edit - thanks for your response! I have read all your wonderful comments and dms. For those seeing this post later, here are the sources that have been suggested that i liked [link] [comments]  |
| ZNGA: future mobile games leader? Posted: 25 Aug 2020 11:11 AM PDT They recently acquired Peak Games and Rollic Games, are looking to increase advertising revenue and have a track record of successful past games like Farmville and Words with Friends. Yet, they haven't broken $10 a share. Does anyone see a bright future for Zynga? [link] [comments]  |
| $SPY puts are really calling my name right now Posted: 25 Aug 2020 12:19 PM PDT The bull side of me sees an upcoming stimulus bill happening soon. Inflation will continue, therefore stock will continue to inflate. The economy is slowly coming back. Political turmoil seems to have eased in recent weeks. I also think spy hitting $400 is possible within the next year. The bear side of me sees ongoing fear in the market. Precious metals still holding up. Hell, warren buffet is even buying gold (Still pinching myself over that one). Incoming hurricane season. Upcoming election (and seemingly possible Biden election, which will be very bad in the eyes of economists). 2 continuous months of market gains with no real pull back. Tesla and apple have been going parabolic, but rightfully so at this time? Oh.. and still no vaccine.. Guys, my bear side is really coming out. The evil in me is drooling over puts right now. Any thoughts? FYI I typed this up in 5 minutes so there may be mistakes. [link] [comments]  |
| Posted: 24 Aug 2020 07:57 PM PDT So the Dow Jones is price weighted. Meaning the higher priced stocks have more of an impact than lower priced stocks. If Apple moves 1% right now, it's roughly $5.03. It's also one of the highest priced stocks in the Dow, so if Apple moves a lot the Dow will move a lot. The split changes this because now a 1% move will only move Apple by $1.25 and it will have less of an impact on the Dow. The S&P500 isn't price weighted. It's market cap weighted. The price of the company stock has no impact on the price of S&P500 and instead how much the market cap chances has more of an impact. So again since Apple is going from $503 to $125 (roughly) that doesn't matter because it's market cap remains the same at 2.1T. It's 1% move will have the same impact because it's a 1% move on 2.1T calculation instead of stock price. If you want more information you can find it on investopedia [link] [comments]  |
| COTY earnings pre-market this Thursday. New CEO starts on 01 SEPT. Will COTY bounce? Posted: 25 Aug 2020 02:10 PM PDT Unlike HELE, ULTA and others in the beauty space that have recovered since tanking earlier this year, COTY has done nothing. COTY traded at $12 in FEB, soon thereafter dropped as low as $3.00, and currently trades around $3.90. Truly a shit stock this year. I'm not expecting much out of this week's earnings, but if COTY does surprise - or doesn't further disappoint? - perhaps the stock will see some positive action. Regardless, COTY has a new (and very experienced) CEO starting on 01 SEPT, and I'm expecting there will be a PR welcoming/touting the new hire. If earnings don't help, perhaps the new CEO coming on board will. I'm long the $5 18 SEPT calls... [link] [comments]  |
| HPE: Transition to As-a-Service and Path to All-Time Highs Posted: 25 Aug 2020 11:43 AM PDT COVID-induced demand pressures for enterprise hardware and recent execution issues have HPE shares trading at 4-year lows and down 41% YTD. However, HPE-as-a-Service strategy starting to show real momentum. Combined with advancements in edge-to-cloud infrastructure offerings, HPE among best values in large cap tech for investors looking to gain exposure to edge networking, distributed computing, and remote working trends. Here's why: Background What is HPE exactly? It is a question that HPE itself has found difficult to answer in the five years since splitting off from the original Hewlett Packard (HPQ). At the time of the split, HPE was more or less described as everything but the PCs and printers. It was a lot of hardware, software, services, but without a clear strategy on how to win in the age of the cloud. As other companies from the PC era, like Microsoft, Dell, and Intel, effectively pivoted their businesses to compete in the cloud and data center, HPE experienced a combination of false starts, missteps, and inconsistent execution. Following its most recent quarterly report in May, an earnings miss coupled with a new cost-cutting initiative sent shares down 10%. And the company now trades at levels not seen since early 2016. With HPE trading at less than 7x forward earnings, markets seem to be pricing in a low probability of a turnaround. However, despite difficulties in gaining traction as a standalone company, it may not be time to give up on HPE just yet. Revenue misses in six consecutive quarters and fears over another round of restructuring are distracting from early signs of success in HPE's transformation to an as-a-service company. With the mega cap and hyper-growth tech trade looking a little overheated on a valuation basis, HPE could present an attractive way to gain exposure to multiple long-term technology trends – namely edge networking, distributed computing, and remote work – while also benefiting from a stabilization and recovery in enterprise hardware IT spend once the COVID-19 induced headwinds subside. Summary
HPE 1.0 and 2.0: How We Got Here HPE 1.0 When HPE was still part of the combined HPE-HPQ, the company had attempted to carve out share in the public cloud and was unsuccessful. Having shuttered that business in 2015, HPE sought to position itself as a more focused and agile end-to-end infrastructure solutions company. This was the strategic rationale behind the decision to merge its enterprise services division with CSC in 2017. The resulting DXC Technology became a pure-play IT services and consulting company. HPE then sold the majority of its enterprise software, database, and analytics offerings to UK-based Micro Focus. HPE 2.0 Around the time of the spin-merger with Micro Focus, HPE revealed its "HPE Next" strategy to fundamentally redesign the company over a three-year period. Although HPE stated its desire to streamline operations, optimize manufacturing, and improve its go-to-market approach, HPE Next was mostly workforce optimizations, or in other words: layoffs. HPE Next did contribute to improvements in EPS numbers from 1Q18 to 4Q19, but following a modest increase in revenue over the first four quarters under the plan, sales have been stagnant or lower in each of the subsequent reports. 2Q20 Earnings As part of HPE's 2Q20 earnings release, the company announced yet another restructuring plan aimed at conserving capital, flexibility, and liquidity given the uncertainty surrounding the global pandemic. The cost-cutting calls for at least $1bn in targeted gross savings by 2022. Together with a 15% decline in revenues year-over-year when holding for currency fluctuations, analysts were quick to issue six downgrades. These numbers do not tell the whole story though. In the face of a tough pricing environment for hardware, gross margins were stable at 32% compared to last year. And several critical business segments showed signs of relative strength in light of the broader market context. HPE's big data solutions grew 61% year-over-year, with storage services from the Nimble business unit jumping 20%. HPE's edge networking segment that houses HPE Aruba only saw declines of 2%. And HPE's flagship as-a-service offering, HPE GreenLake, saw its annual revenue run rate increase 17% to $520mn. HPE GreenLake is now the company's best performing business according to CEO Antonio Neri. When considering HPE exited the quarter with a $1.5bn backlog, or 2x historical levels, it's very likely that procurements were delayed or rescheduled rather than canceled. Because of this, once IT departments have greater visibility into the crisis, HPE should be poised to see a sharp recovery in its hardware-focused reporting segments. HPE 3.0: HPE-as-a-Service After years of difficulties defining its value proposition in the new computing landscape, HPE appears to have developed a distinct approach to leverage its networking, computing, storage, and software capabilities and bundle them into a fully integrated edge-to-cloud platform. The strategy, HPE-as-a-Service, aims to offer every single HPE product on a pay-per-use subscription basis by 2022. The company's new IT equipment and services package, HPE GreenLake, takes a range of products selected by the customer and provides a simplified management console and on-demand toolkit for the entire hybrid cloud setup. As HPE further transitions towards the as-a-service model, HPE GreenLake, as well as its advancements in edge networking and performance computing, could lead to greater market share in multiple segments of hybrid IT spend. HPE GreenLake As enterprise IT becomes increasingly hybrid – i.e. a mixture of on-premise and off-premise computing power – organizations have seen management of these systems become more siloed. As a result, companies are seeing greater demands on their IT staff, inconsistent user experiences or application performance, or lower visibility or risk control across networks. HPE GreenLake is a bundled-service offering that enables customers to select only the capabilities that they need and to deploy them faster, with less management, and at a lower CAPEX risk. Through its metering features, GreenLake makes it much easier for companies to scale computing resources up or down, thereby enhancing flexibility while also allowing IT teams to offload management of hybrid cloud resources to HPE's operations center. Once customers sign up for HPE GreenLake, they select from 15 cloud services like machine learning, virtual machines, big data, networking, storage, or compute. HPE promises to have the chosen services delivered and operational within 14 days. And GreenLake runs on top of existing Amazon AWS or Microsoft Azure cloud computing environments, making the transition seamless. According to HPE, GreenLake reduces time-to-market for IT deployments by 75%, reduces CAPEX by 40% once in-use, and delivers 147% return on investment and total payback within 12 months. Improving deployment efficiencies not only conserves staffing resources and expands business productivity, it reduces the need for companies to invest in IT infrastructure before they are ready. Because HPE GreenLake is pay-per-use, customers can prevent overprovisioning of resources and eliminate expenses associated with technology refreshes, all the while ensuring adequate posture to accommodate usage spikes when on-premise compute is not sufficient. Customer satisfaction for GreenLake is extremely high, with HPE reporting 99% retention rate for contract customers currently subscribed to the platform. The Edge, Distributed Computing, and Remote Work Even though COVID-19 sparked some near-term challenges for enterprise hardware demand, the pandemic has also accelerated much longer-term trends related to computing and working – trends that should benefit HPE. As companies increasingly leverage computing power at the edge, and as work becomes more and more distributed and remote, the comprehensive end-to-end edge networking platform developed by HPE Aruba and recently-acquired Silver Peak could lead to share gains in multiple end markets projected to grow for the rest of the decade. According to Cisco, by 2025, 75 billion devices will be connected to the internet. Between the combination of IoT and the growing number of user devices consuming larger amounts of content digitally, the global datasphere is forecasted to roughly triple by then. And at that time 75% of enterprise-generated data is expected to be processed at the edge. In a widely distributed computing environment with exponentially greater data loads, it will become even more vital for IT purchasers to invest in and maintain the right set of networking tools to compete in the future. HPE Aruba HPE Aruba provides a range of wired and wireless data center and edge networking solutions, including Wi-Fi 5 and Wi-Fi 6 products, access points and gateways, as well as network switches for both data center and edge locations. Although HPE Aruba has pushed into SD-WAN, historically its business has been driven by WAN and WLAN hardware and services. A WAN, or wide-area network (WAN) is a collection of local-area networks (LANs) or other networks that communicate with one another. A WAN is essentially a network of networks (like a much smaller internet). WLAN is simply a wireless LAN that connects computers and network devices wirelessly. While the enterprise WLAN market actually fell 2.2% year over year in Q1 2020 due to COVID-19, WLAN is forecasted to grow at over 20% annually the next five years on the back of technology refreshes associated with the new Wi-Fi 6 standard (enterprise WLAN was a $1.3bn market in Q1) and increased adoption of Internet-of-Things (IoT) devices. And HPE Aruba is currently the #2 leader in market share at 14.4% after Cisco at 45.7%. Perhaps where HPE Aruba is set to deliver the strongest results over the long-term, though, is in its newly announced edge networking architecture called the Edge Services Platform (ESP). Aruba ESP is the industry's first AI-powered platform designed to unify, automate, and secure edge networking. Aruba ESP leverages artificial intelligence to simplify IT operations management as well as accelerate and automate troubleshooting in distributed IT environments. With built-in Zero Trust Security, ESP secures all access across your network. And the platform also provides unified infrastructure so that WLAN, LAN, and SD-WAN resources can be singularly monitored and optimized across branch, campus, remote, and data center locations. This is important because the promise of the edge is in the ability to more rapidly acquire real-time data so that it can be more quickly analyzed and acted upon. By deploying integrated networking and analytics at the edge, Aruba ESP can enable businesses to optimize process efficiency, boost security, and increase reliability. This capability removes the previous need to send data to a remote data center location or third-party company for analytics. Silver Peak HPE's acquisition of Silver Peak is a great strategic investment to further build out its integrated edge product portfolio. With the strength of HPE Aruba in WAN/WLAN, HPE will soon be able to offer market-leading SD-WAN solutions alongside its AI-powered intelligent edge platform, making for a very compelling and comprehensive product suite for enterprise customers. SD-WAN, or software-define WAN, uses software to replicate (virtualize) functionalities that traditionally were housed within hardware. What this allows for is functions to then be remotely monitored and controlled. It makes network management simpler, bolsters security, and enables much more efficient network routing. Despite being one of the few remaining independent SD-WAN players, Silver Peak has carved out a spot near the top of the market. The company counts over 1,500 customer deployments for its Unity EdgeConnect™ SD-WAN edge platform, and Silver Peak is consistently among the five largest vendors with over 7% market share in a field that includes heavyweights such as Cisco and VMware. The SD-WAN sector hit $1.9bn in 2019, but industry estimates expect it to reach $8bn by 2025 – delivering compounded annual growth of nearly 35%. Having been named by Gartner as one of two leaders (alongside Cisco) in its SD-WAN magic quadrant for two consecutive years, a combined HPE Aruba-Silver Peak solution is primed to capture even more market share for enterprise customers would like to pursue a multi-vendor strategy or diversify away from over-reliance on Cisco. The Path to Gaining Share in Computing Composable Infrastructure HPE's software-define infrastructure innovations extend to computing as well, namely with HPE Synergy which started shipping in early 2017. HPE Synergy is a new category of computing infrastructure designed to bridge non-cloud-native and cloud‐native applications. Non-cloud-native applications are applications that exist with persistent storage and usually have a fixed number of network connections. This contrasts with cloud-native applications which are designed for a cloud environment. As much as services are being shifted to the cloud, for some companies, applications have existed in non-native states for so long that it could be risky and costly to move to the cloud or could require significant time and resource planning. This is where composable infrastructure and HPE Synergy steps in. Composable infrastructure treats compute, storage, and network devices as pools of resources that can be tactically provisioned as needed depending on the requirements of distinct workloads. It can be instantly flexed to meet the needs of any application or any workload, and it is ideal for a hybrid cloud environment. DellEMC released its version of a modular composable server halfway through 2018, and a startup named Liqid is also in the space. Past studies have put average server utilization rates between 15-35% because typical server designs have fixed amount of resources provisioned against disparate application needs. In a study commissioned by HPE, enterprise data center respondents reported that only 45% of infrastructure was provisioned most of the time, leaving over half of a company's valuable computing resources unused. Although converged and hyperconverged infrastructure also combine computing, networking, and storage, only composable infrastructure is not preconfigured for specific workloads. On top of that, composable is more scalable than hyperconverged which can be limited to 20-30 nodes. HPE Synergy thus greatly reduces dedicated IT staff time to deploy servers or install firmware, increases productivity, and lowers procurement and operating costs. HPE Synergy is estimated to deliver three-to-one return-on-investment for IT customers over a five-year period. With composable infrastructure projected to follow hyperconverged systems and hit nearly $5bn in sales by 2023, Synergy could provide HPE yet another competitive product advantage to carve out share in a healthier IT hardware procurement environment. HPE Cray Supercomputers and Big Data In addition to traditional IT infrastructure, product advancements in high performance computing also have HPE positioned to gain new customer wins and develop the reporting segment into a larger contributor to the top line over time. Although the term supercomputing has been around for a few years, for many it continues to be an abstract or futuristic concept without tangible applications for today. But as tens of billions of internet-connected machines come online over the next decade, the amount of structured and unstructured data being generated will become that much harder to translate into valuable or actionable insights. That is why supercomputing can play a major role in solving the most data-intensive challenges facing corporations and governments worldwide. The US and China have been engaged in heavy competition in recent years to create faster and faster supercomputers, and other countries like Japan are also starting to get involved. Currently supercomputers are used in the fields of life sciences, genomics, manufacturing, weather, and nuclear science. However, in the age of IoT and zettabyte-scale datasets, much more powerful computers will be necessary to fully take advantage of big data analytics and artificial intelligent capabilities. The fastest exascale-class supercomputer in the world today is an HPE Cray supercomputer named El Capitan. The system, which will be delivered to the US Department of Energy's Lawrence Livermore National Laboratory by 2023, is 10x faster than the runner-up. This market is still extremely nascent, and supercomputing is only a portion of the 9% of HPE revenues generated by the High Performance Compute & Mission Critical Systems (HPC MCS) segment's. But as the market becomes more mature, HPE GreenLake will provide a stronger ability to cross-sell supercomputing products to very large-scale organizations – a major advantage for HPE Cray compared to when it was a standalone company. Conclusion Recent weakness in HPE shares following Q2 earnings have largely priced-in near-term risks associated with COVID-induced demand pressures for enterprise hardware solutions. With shares down 41% YTD, the company is trading at 6.63X forward earnings and 0.44x sales. These multiples are both among the lowest levels relative to other large cap IT hardware peers such as Dell (10.99 forward P/E), Cisco (13.81 forward P/E), or IBM (11.16 forward P/E). Despite difficulty formulating an effective cloud strategy in the years following the split from HP, HPE has multiple growth drivers with exposure to critical long-term computing, networking, and working trends. As HPE further develops its business into a fully service-based, pay-per-use model, revenue and earnings should become increasingly stable and less subject to near-term demand shocks as has been seen so far in 2020. Although management's cost saving plan announced in May was poorly received by the markets, strong sales visibility by virtue of the $1.5bn quarterly contract backlog means that HPE's struggles will likely be short-term. Combined with cost reductions, as enterprise hardware spending picks back up, the company should experience gross margin improvements, earnings growth, and multiple expansion. Together with the more targeted approach as an edge-to-cloud infrastructure service provider, HPE currently presents one of the best values in large cap tech for investors looking to gain exposure to edge networking, distributed computing, and remote working trends over the next 5-10 years. You can find me on Twitter @BlackjacketCo where I write about emerging technologies and long-term market trends. Thanks for reading! [link] [comments]  |
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