Is LULU Stock A Buy After 20% Price Surge Following Strong Q4 Results

After getting to a poor start to 2022, the maker of athletic comfort wears, Lululemon Athletica Inc. (Nasdaq: LULU), made a rebound to its highest level all year long. This surge resulted from the company’s positive financial results in its latest quarterly reports.

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Source: Scott Webb

Is it now time to get in on the stock?

Lululemon recorded some of its highest sales growth during the pandemic, with many people rushing its comfortable athletic apparel. Among its best-selling items was the female yoga pants. But since the world resumed from covid-imposed restrictions, the company hasn’t quite reached those heights.

However, with the latest Q4 FY 21 report released on the 29th of March, Lulu looks to be on the path to full recovery.

Lululemon recorded a 23% year-on-year increase in total net revenue to $2.1 billion. Diluted earnings per share also beat consensus analysts’ estimate of $3.27 by $0.1. These results were strong enough to drive the stock to a 21% rise.

Lululemon might have managed to gain relevance in the athletic apparel retail space. Still, it would need innovation to lock in on growth opportunities to maintain its position as one of the most prominent retailers in the space. The company is doing just that with its women’s footwear line, released in early March.

Lululemon said it targeted women first because it saw a problem in how most performance shoes were first made for men before being adapted for women. And according to the management, this idea has immediately been taken with vigor among customers.

Technical Analysis

LULU bounced right off the $276 – $289 support level and has made its way to the $378 – $392 resistance level.

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If the price breaks out of the resistance, a reign of the bulls would be officially ushered in. Otherwise, the price could return to the support and bounce between the two levels until a breakout.

Alternatively, there could be a breakdown of the $276 – $289 support level if the LULU stock price returns. This scenario, however, is the least likely, since this support level has remained sturdy and unbroken on five occasions since 2020.

We recommend waiting for the stock to complete a breakout and retest of the $378 – $392 resistance level for traders looking for the best position to buy. Alternatively, you could also buy at the $276 – $289 support if the price returns to the level.

Tantalizing Stock? Elon Musk Becomes Twitter’s Largest Shareholder

Crypto traders would know too well the effects Elon Musk and his tweets had on cryptocurrencies in 2021, especially Bitcoin and Dogecoin. However, the kind of influence Elon Musk pulled on the stock of popular social media, Twitter, Inc. (NYSE: TWTR), this time around had little to do with his tweet.

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Source: Akshar Dave

What happened?

Twitter stock was feeling the brunt of the tech sell-off, having dropped by 53% since October 2021. Then something happened, driving the stock up by 30% in just one day.

And guess who did (or didn’t) have something to do with it? Elon Musk.

A regulatory filing revealed that the CEO of Tesla owns a 9.2% stake in Twitter, making him the company’s largest shareholder. This filing triggered an immediate spike in the Twitter stock, driving it up by 30%.

What this means

Elon Musk has been hinting at a social media shakedown in recent times. He once created a Twitter poll where he asked his 80 million followers if Twitter “rigorously adheres” to the principle of free speech. 70% of those who took part in the poll didn’t think so. He then asked if a new platform was needed.

His purchase of TWTR stock answers the question.

Being the largest shareholder of Twitter, Elon now wields a lot of influence on what happens to the company. And if the height that TSLA stock has risen to is any indication, we can assume that TWTR could be on the same trajectory.

What next?

Twitter recorded 217 million monetizable Daily Active Users (mDAU) at the end of Q4 FY’21, a 13% increase from what it was in Q4 FY’20. This shows how Twitter is growing in popularity and adoption.

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With this vast market, Twitter amassed a total revenue of $1.56 billion in the same quarter of FY ’21, 21% higher than it accrued in the previous year.

Other metrics also display the company’s growth and strength. And when you put it all together, TWTR makes a strong case for growth. It’s no wonder Elon Musk found it attractive enough to put his money on it.

Technical Analysis

The revelation of Elon Musk as a stakeholder in Twitter caused the stock to leap to the $48.5 – $51 resistance level.

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We expect the price to re-settle after all the hype has died down. And this could mean the stock falling back to the support level at $41.

But if the stock defies the $48.5 – $51 resistance level above it, TWTR stock may find itself in the territory of the bulls.

Clorox Stock: Hot From A Devastating Dip. Needs A Miracle

While the pandemic affected many companies, The Clorox Company (NYSE: CLX) couldn’t have been placed in a better position to make profits. The company sells cleaning products and disinfecting wipes, two of our favorite safety items during the pandemic.

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Source: Clay Banks & Peter Yost

However, the pandemic is all but over now and things are not looking as bright for CLX stock, which has been singing the same old song since August 2020 – downtrend.

Having risen by 44% from a range in March 2020 to an all-time high of $240, the stock has since sunk by close to $100 to its current price.

Support and Resistances

The Clorox stock finds itself in a precarious situation, having bowed below the $140 – $146 support level and now tests it as a resistance level.

If the price fails to orchestrate a breakout of this resistance level ($140 – $146), the next support level is over 20% below at $107 – $114.

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Since the general market sentiment on Clorox stock is very negative, there’s no telling when the stock will recover from its 21-month downtrend.

Signals and Forecasts

The CLX stock rests on the base of the descending price channel it started in 2020. As a result, there could be a brief bullish pullback on the stock before it resumes its downtrend.

However, we do not expect a strong pullback, as the retest of the $140 – $146 resistance level could be all the pullback we’re going to see. Also, CLX has mostly stuck to the middle of the descending trendline since the beginning, which coincides with the resistance level to which the price is making a retracement.

Should You Buy Clorox Stock now?

For now and in the foreseeable future, steer clear of Clorox stock. There are many negative signals for the stock. And there doesn’t seem to be a light at the end of the CLX stock’s tunnel, with the price falling below the $140 – $146 support level.

To compound the problem, CLX’s PE ratio of 72, despite its massive fall, makes it more than twice overvalued compared to stocks in the US household products industry.

Until there are more positive signals for the Clorox Stock, we hold a bearish sentiment toward it.

Tesla Stock Split: A Trigger For More Stock Growth

Tesla, Inc. (Nasdaq: TSLA) revealed in an official regulatory filing and through a tweet that it would be seeking approval in its Annual Shareholders’ Meeting for it’s second stock split in two years. The last time the company split its stock, TSLA stock ended the year 90% above where it was immediately after the split. It has since increased by an additional 55% to its current price of $1099.

But what does this split mean for potential investors?

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Source: Stephen Mease

What has happened

TLSA, in a tweet, said it will “ask shareholders to vote at this year’s annual meeting to authorize additional shares in order to enable a stock split.” This announcement puts Tesla among the ranks of the top tech companies, such as Alphabet (Google’s parent company) and Amazon, who all intend to split their stocks this year.

Tesla plans to split the stock in the form of dividends. While this does not directly translate to increased company value, it might be a catalyst for that.

If Tesla uses a ratio of 10:1, every shareholder will own nine more shares for every single one they held before the split. But each of the ten shares would only carry a tenth of the value they had before the stock split. So, if Tesla stock was trading at $2000 on the day before the split, it would have a new price of $200 immediately after the split.

Why It Matters

Stock splits are often good news for shareholders. Alphabet announced a stock split in February, and the stock jumped by almost 10% for it. Amazon announced a stock split in March, and the stock currently traded 21% higher.

Tesla followed a similar path in 2020 when it announced its stock split, and the price rose by close to 80% before the split became effective on the last day of August.

Judging from history, we can expect Tesla to do the same thing it did in 2020, which is also the same thing Amazon is doing. Short-term stock traders will have reasons to be glad about this because it means an increase in the value of their shares before the stock split.

Potential shareholders may also find this to be great news because it is easier to buy a stock priced at $200 than to buy one at $1000.

What Next?

Another good side to stock splits is that it shows how much confidence the board of directors has in the company. Already, Tesla is a popular stock among investors. Splits like this would only make it more popular.

Arguably the electric vehicle industry leader, Tesla has sold close to 2 million electric vehicles. And 32% of all cars sold since 2016 came in 2021, which testifies to the popularity of the company’s products among users.

Financials have also been impressive, with a 65% YoY growth in total revenues to 17.7 billion at the end of FY 2021 and a 135% YoY growth in total gross profit to $4.8 billion.

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Source: Tesla

And as more countries commit to their sustainability goals and EVs continue to trend among vehicle owners, you can expect TSLA company to continue its successful run.

Technical Analysis

The TSLA stock is very close to the $1170 – $1223 resistance level, and it may continue to break out of this level if the hype from the stock split continues.

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Otherwise, there’s a support level at the $740 – $796 level to which the price may return if it bounces off the resistance level above it. Another critical level is the $900 price level, where the price is also likely to make a reaction.

Marijuana Legalization: Why You Shouldn’t Buy CLVR Stock Now

The weed industry is edging closer to legalization in the United States. But before it gets there, there are some hurdles it must cross. One of which is the enactment of the MORE Act of 2021.

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Source: Nguyen Linh

What has happened?

The Marijuana Opportunity Reinvestment and Expungement (MORE) Act of 2021 is a bill aimed at removing marijuana from the list of contraband substances in the United States. The bill is supposed to be voted on in the Senate sometime this week.

On the release of this news, marijuana stocks have soared amidst optimism that the law might be passed. The stock of Clever Leaves Holdings Inc. (Nasdaq: CLVR), one of the manufacturers and growers, posted a 144% jump on Friday.

However, rumors started to come out that the bill may not actually pass. And just like that, Clever Leaves shed most of its rise by Monday.

So What?

The MORE act needs 60 votes in the senate to pass, and many analysts believe it would struggle to secure those votes. While a failed legalization of the bill at this time may not be the end of the road for marijuana stocks in the United States, it remains a huge stumbling block.

Also, there’s still the SAFE banking act that exposes weed companies to more financial services that may be passed before the end of the year. So, the failure of the MORE Act legalization is likely a temporary setback.

Now What?

Clever Stock is in a good place financially. The company recorded a 27% growth in net revenue  to $15.4 million in the recently concluded annual report for FY ‘21. Subsidiaries of the company in Germany and Portugal also recorded their first revenues.

Why You Shouldn't Buy CLVR Stock Now 02

Source: Clever Leaves

If weed gets legalized in the U.S., Clever Leaves is well placed as one of the largest cultivation and extraction companies in the country, and will be able to compete in the stiff race to the top that the weed industry finds itself.

Technical Analysis

Judging by the technical analysis alone, CLVR stock is untouchable for the stock trader with anything below a voracious risk appetite. The stock has recorded nothing but a dip in about year. It had its most recent high in August 2021 and has since dipped by 84%.

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The trick in knowing when to get in on CLVR is to know where the dip bottoms out. It might seem like we have a bottom at the $0.94 price level, but we can’t be sure until the level is retested.

Until we have stronger reasons to buy CLVR stock, we recommend you hold.

IEP Stock: Should You Buy Icahn Enterprises Now?

Icahn Enterprises L.P. (Nasdaq: IEP) is a common name in many commercial industries in the United States and internationally. Icahn deals in the automotive, pharmaceutical, food packaging, home fashion, energy, and real estate spaces through its subsidiaries.

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Currently, the stock is at a critical point, at which whatever happens could determine what happens to the stock for a while. And the question on the minds of many stock traders is this:

Is Icahn stock a buy now?

Here’s what the IEP stock chart says:

Supports and Resistances

IEP currently rests atop the $45.2 – $51 support level. This support level is very resilient, as the price tested it multiple times as a resistance level between 2009 and 2012 before a breakout turned it to a support level. Since then, it has repelled the stock multiple times.

Another level of importance on the Icahn stock monthly chart is the $73.4 – $79.2 resistance level.

Signals and Forecast

As the IEP stock sits above the $45.2 – $51 support level, it is good news for potential buyers of the stock because stock prices tend to bounce back from support levels.

However, there’s a bit more complication with the IEP stock. The price has witnessed a series of lower highs without lower lows. Technically, IEP stock is not on a downtrend, but instead, it looks to be squeezed between the $45.2 – $51 support level and the trendline.

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There are two scenarios from here. The stock could either break out of the trendline or break below the support level. A breakout from the trendline is a bullish signal, while a breakout from the support level would be a bearish signal.

Another possibility is that the stock breaks out of the trendline but continues ranging between the $45.2 – $51 support level and the $73.4 – $79.2 resistance level. While long-term growth investors may find it frustrating, short-term traders might see this as an opportunity to buy-low-sell-high.

Should you buy IEP stock right now?

There’s too much uncertainty around the IEP stock right now. But what is certain is that the stock will soon decide whether to go bullish or bearish. Until then, we recommend you hold IEP stock.

Sleep Well At Night With This Dividend Stock In Your Portfolio

Regardless of how high inflation is or what economic conditions we find ourselves in, some stocks are always going to be safe havens. While business may sometimes seem slow for these companies, you can bank on them 9 times out of 10. One such stock is Easterly Government Properties (NYSE: DEA).

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Source: Michael

Easterly Government Properties is a Real Estate Investment Trust (REIT) that acquires and develops properties and then leases them to the United States government. And that is exactly why we believe Easterly is one of the safest stocks there are. What other way is there to guarantee your safety if it isn’t by having the government itself as one of your customers?

Being a REIT, DEA does well for its shareholders with a dividend yield of 5% and a payout ratio of 71%. While this payout ratio is high enough to scare off anyone from any other company, this one is just characteristic of a REIT. Also, the company has enough earnings from business to keep up with this high payout ratio.

In the fiscal year ending in 2021, DEA received $124.2 million in funds from operations (FFO), and a net income of $34 million. In that same year, it acquired 12 properties at $412.3 million. What these figures mean is that the company has a solid financial base and is expanding its business.

Also, DEA has been keeping its tenant, dear Uncle Sam happy, with a very meager 2.4% as the total annualized lease income expiring.

The only issue with this SWAN stock is that it has no staggering growth potential. The stock price can be stuck within the same range for years. But the good thing about this is that you don’t have to worry about volatility. You also don’t even have to worry about buying cheap because the stock may not be significantly cheaper than it is in the next few years.

Technical Analysis

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Since the DEA stock saw a kind of see-saw pattern in 2020, it has since settled in between the $19.5 – $20 support level and the $22.7 – $23.2 resistance level. There aren’t many signs that anything spectacular will happen to this stock. Another resistance level awaits the price at $25.7 – $26.2 in case the bulls are inspired. Otherwise, we expect the price to continue to consolidate for a while.

If You Missed Out On Amazon in 1998, Lithium Americas Offers A New Opportunity

Many nations are taking environmental sustainability commitments seriously. Although European countries lead the charge for this cause, the United States is not far behind. By 2035, the U.S. looks to ban the sale of gas-powered cars. The United Kingdom plans to do it five years earlier.

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Source: Vlad Tchompalov

It will be a significant change if these happen, as the transport sector alone accounts for 21% of total emissions.

Like many major changes in history, some stocks suffered while others soared for the same reason. The stock we have for you today is one we believe will be at the forefront of the gainers. We bring you Lithium Americas Corp. (NYSE: LAC)

And so, the transition from gas-powered cars to battery-powered cars has been set in motion. These batteries are raw-material-intensive, with lithium being one of the most prominent of these raw materials. As a result, the demand for lithium will only grow as more EVs and EV makers come on board.

Let’s talk a little more about Lithium Americas. Sometime in the middle of the year, Lithium Americas plans to begin production at Cauchari-Olaroz in Argentina. In its FY 2021 full-year report, the company estimated the project to be at 85% completion.

But what’s perhaps more exciting is the company’s gaining of permit to start construction at Thacker Pass lithium mine in Nevada.

Apart from the apparent fact that productions are only around the corner, diversity is another benefit of having these two mines in Argentina and the U.S. This way, the company can better serve various EV operations.

The demand for lithium will be the driving factor for the LAC stock. The market opportunity is also immense. But there undeniable are risks.

Lithium Americas is still pre-revenue and still without profits. So, until Lithium America begins production, gets its products to the market and makes its first sales, shareholders are still keeping their fingers crossed.

However, a lot of investment has gone into this company and the expectations from shareholders are at peak levels. If all things remain equal, Lithium Americas is a great investment opportunity for investors who wish they had bought Amazon stock in 1998.

Technical Analysis

LAC stock has been on an uptrend since March 2020. A strong trendline underlines the stock price as it hit its all-time high in late 2020.

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As we speak, the stock has settled above the $23.7 – $25.6 support level. And if you zoom into the daily chart, you’ll find that this support level has been tested five times, proving its resilience.

There’s still some room to grow for LAC stock before it reaches the $39.3 – $41.6 resistance level above it. But should the stock bow to the bears, the support trendline that holds the stock may fail, exposing it to a free fall to the $6.2 – $8.2 support level.

Long term, however, we have strong bullish sentiments for LAC stock, more because of its fundamentals than its technicals.

Allstate Stock Is On The Rise. Should You Buy Now?

Allstate Corp (NYSE: ALL), a financial services company, has been impressive on the charts. The stock rose by 6% from its opening price of $125.6 in the third week of March 2022. A significant increase in weekly volume supported this move.

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Source: Scott Graham

That same week, the stock broke out of the $123.7 – $127.6 resistance level. A retest is yet to happen, though. But if a retest happens and this level holds it, that would confirm its new identity as a support and even make the level a good buying point for the stock.

Supports and Resistances

The sky is not yet the limit for ALL stock. It still has a resistance level around the $139 price, where it recorded its all-time high.

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Only when the price breaks out of this level, reaching a new all-time high in the process, can we argue that the stock is headed for uncharted territories. Until then, the most recently breached resistance level remains a critical level.

Other pivotal levels on the ALL stock chart are the $106.2 – $109.7 and $85 – $89 support levels.

Should You Buy The Allstate Corp Stock?

The ALL stock has broken out of a resistance level and could retest the same level. The stock has also been on the rise since December 2021. Only about 5% of the price gap separates the stock’s current price from its all-time high. These are all positive signals.

As a result, we hold a bullish sentiment for the stock long term. In the short term, however, we recommend holding the stock until the price retests the $123.7 – $127.6 resistance level and makes it a support. Only then can we be sure that this breakout is not false.

However, the rise in volume that followed the stock’s 6% rise in the last week suggests that this breakout isn’t false. But really, it’s the stock market; you won’t know for sure until it happens.

And if the price does return to this resistance level, we advise that you place your stop loss south of the level at around $120.

Should You Buy This 5.4% Dividend Yield Stock Now?

Our most recent analysis mentioned a stock with solid dividend ratings and worth buying. Today, we have something similar; another dividend stock to boost your portfolio, regardless of the market condition.

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Source: Pixabay

But it’s not all rosy for the stock, though, as there are some red flags. So, should you now buy Williams Companies, Inc (NYSE: WMB)?

The Wiliams Companies is an energy midstream establishment that delivers natural gas to its end-users. WMB is so successful that it manages about 30% of the natural gas in the United States.

Another thing WMB has going for it is a rock-solid balance sheet. The adjusted EBITDA of the final quarter of FY 2021 increased by 11% year on year to $1.4 billion. Adjusted earnings-per-share increased by 26% to $0.39, And the available funds from operations also topped what it was in FY 2020 by 6% to $1billion.

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Source: Williams Companies

These figures are not a one-time thing. WMB has recorded successively solid results in the past. So, it’s not a surprise that the natural gas midstream company has a dividend yield of 5.4%.

Williams Companies might not have the most exciting prospects, but it has put plans in motion to help it remain relevant and even grow. An instance is the company’s agreement to acquire gathering and processing assets at the Haynesville basin. That, and expansion projects in Pennsylvania and Alabama, would increase the company’s capacity going forward.

The valuation, however, is a reason investors could pause before buying the stock. WMB is overvalued at a price-to-earnings ratio of 24.9 in the US oil and gas industry with a PE ratio of 15.8. For this reason, we suggest you hold the stock for now and await a lower valuation.

Technical Analysis

WMB stock has done a great job recovering from the coronavirus-induced dip in March 2020. Over 200% rise since then is no fluke.

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There was a resistance level at the $25 price, but the price seems to have gotten past that. However, it is anyone’s guess what the price does at the $31.5 – $34.3 resistance level.

Based on the technical analysis, we recommend you hold the WMB stock until a clear price action pattern appears based on the technical analysis. This pattern could come from the price breaking out of and retesting the $31.5 – $34.3 resistance level or falling back to the $15.4 – $18.5 support level.