In mid-week trading, stock markets will react to the Bureau of Labor Statistics’ report on February’s inflation. Drilling down to stocks, watch AppLovin (APP). Shares lost 7.7% on Tuesday.
AppLovin attracted strong buying momentum at below $400. But at $477, traders are taking profits. APP stock trades at a 50.5 times price-to-earnings ratio. That makes its stock vulnerable to negative media commentary.
In the health plan sector, Centene (CNC) might rebound from the nearly 16% drop yesterday. The firm warned that the Affordable Care Act (aka Obamacare) is a headwind. ACA membership declines might reach the mid-30% or more. Expect buy-the-dip investors to pick up CNC stock at these levels.
Oracle (ORCL) posted third-quarter results that sent shares up by more than 8% in after-hours trade. Non-GAAP EPS was $1.79 ($1.40 GAAP), as revenue grew by 21.7% Y/Y to $17.19 billion.
Oracle’s peers to consider include CoreWeave (CRWV), Microsoft (MSFT), and Dell Technologies (DELL). In contrast, Hewlett Packard Enterprise (HPE) risks underperforming.
HPE posted revenue of $9.3 billion (+18.5% Y/Y), but the post-earnings rally fizzled. HPE stock touched $22 before closing at $21.10. The firm has an attractive value, offers growth and profitability, but analysts are negative on its revenue and profit outlook.
In the software space, watch out for last month’s rally in Intuit (INTU), ServiceNow (NOW), and Adobe (ADBE). Their momentum risks weakening as investors buy Sandisk (SNDK) and Seagate (STX).
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