Stocks on Wall Street roared back from a sharp sell-off on Friday, but the main averages ended a volatile week as investors continued to weigh the impact of a furious rise in bonds.
The blue chip posted a weekly gain of 1.8%, while the blue chip posted an increase of 0.8%. However, they underperformed, with the tech-heavy index declining more than 2% over the same time frame.
Dow: S&P: NASDAQ 300 Minute Chart
Between another series of high-profile earnings reports and more important economic data, the next week is expected to be another busy week on Wall Street.
Regardless of which direction the market is heading, below we highlight one stock that is likely to be in high demand and another stock that may see further downsides.
However, keep in mind that our timeframe is for the next week only.
Stock To Buy: Roblox
Roblox, which operates a wildly popular online platform that allows users to easily play and develop video games, is expected to make headlines this week. when it makes its highly anticipated debut on the New York Stock Exchange on Wednesday, March 10.
After delaying plans to go public last month, the San Mateo, California-based digital entertainment platform, which was founded in 2004, will directly list its shares and join a list of notable companies that have been launched through the stock market go public. the same route, including Palantir (NYSE :), Slack (NYSE 🙂 and Spotify (NYSE :).
In total, the company, which will trade under the ticker symbol "RBLX", plans to issue 198.9 million shares.
Although it has not specified a price range prior to listing, Roblox sold nearly 12 million convertible preferred shares in January through a private placement for $ 45 a share. A listing at that price would value the company at about $ 29.5 billion, compared to a valuation of just $ 4 billion a year ago.
The gaming platform recently said revenues for the year ended December 31 were up 82% from the same period last year to $ 923.9 million, while bookings – a key measure for the company – more than doubled to about $ 1.9 billion.
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In addition, the platform's daily active users (DAUs), composed mostly of teens and young teens, increased by 85% last year to an average of 32.6 million. Those users spent 30.6 billion hours on the platform, up 124% year-on-year.
Still, Roblox is not yet profitable: losses amounted to $ 253.3 million last year from the $ 71 million lost in 2019, mainly due to increased expenses related to infrastructure, security, sales , marketing and research and development.
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Looking ahead, the company expects its revenues to double in the first quarter of 2021, with DAUs expected to increase by 59% to 68% from last year's levels.
Stock To Dump: Zoom Video Communications
After falling nearly 10% last week, Zoom Video Communications (NASDAQ 🙂 stock appears below pressured to stand amid the lingering impact of several negative factors plaguing the video conferencing specialist.
ZM shares ended Friday's session at $ 337.43, earning the San Jose, California-based cloud communications company a market capitalization of approximately $ 95.9 billion.
Widely regarded as one of the biggest winners of the COVID-19 pandemic, Zoom shares have now pulled back nearly 43% since hitting a record high of $ 588.84 on Oct. 19. about 195% over the past year.
Sentiment about the disgraced name took a hit as investors dumped tech stocks that recovered during the pandemic and turned into cyclical stocks that are likely to benefit from the reopening of the economy.
That trend is likely to continue in the coming week as more states across the country begin to ease lockdowns and stay-at-home measures, given the advancements being made in the field of vaccines.
Another cause for concern: Zoom made a strong return last week, despite releasing the in its history, which saw the technology company record year-over-year increases of 713% and 369% in EPS and revenue, respectively.
After initially moving higher immediately after release, ZM's stock plummeted in the prospect amid the belief that some of the tailwinds it has enjoyed from COVID-related restrictions will diminish as more employees return to the office.
In addition, Zoom's tech stuff signals that more selling pressure is on the horizon after ZM shares closed below their major 200-day moving average for the first time since the April 2019 IPO, as investors increasingly turn away from companies in the home trade.
