Intel goes shopping for chips

February 16, 2022 Good morning traders! Welcome back to The Daily Setup. Markets were up yesterday as people stopped worrying about the tension in Eastern Europe. Here’s what’s on the docket today: - Virgin Galactic starts booking again - Inflation is still high - Intel goes shopping for chips Let’s make today a good one. Nick How’d the markets look? Market Outlook 👀 DOW 34,988.84 +1.22% S&P 500 4,471.07 +1.58% NASDAQ 14,139.76 +2.53% BITCOIN $44,151.93 +4.64% Virgin Galactic, inflation, and Air Bnb BIGGEST MOVER Virgin’s long time coming Shares of Virgin Galactic shot up [32.10%]( yesterday after the company announced that it would take more reservations for its space flights starting today. Since the stock’s all-time high of $57.51/share last June--- just weeks before Branson competed in the [extraterrestrial pissing contest](-- it’s tumbled over 80% after the company’s sudden [delay of customer flights]( until Q4 2022. One tiny step for man, one small step in the right direction for Virgin. - For the small price of [$450k]( (with just a $150k deposit) you can escape gravity and have your balls feel weird for a few minutes. The 600 or so folks who bought tickets years ago only had to pay $200k-$250k-- but for a nearly identical experience, you can still just get [sack tapped]( for free. Decisions, decisions. - [Options include]( a singles seat, the couples’ seat package (should’ve released this before Valentine’s Day), or a family package. Imagine being that one scrub on the entire ship who goes to space alone. - Virgin hopes to have 1,000 reservations filled by the end of the year, so the window may only remain open for another 300 or so customers. The longer it takes to fill those holes spots, the worse Virgin’s going to look. Virgin’s stock is probably going to keep recovering now that it looks like the company’s on the right track-- unless it delays flights again. The 2021 setback will likely cap the stock well below its all-time high since competitors SpaceX and Blue Origin haven’t had similar issues, but in the short term I think for me it’s a buy. PPI boutta steal yo gurl ...But my friends call me “The Producer Price Index” I hope you made gains this winter, because the Producer Price Index sure did and it’s hungry for more. On Tuesday the Labor Department released data showing that the [PPI rose]( 9.7% YoY from last January and 1% last month alone. Those numbers are both [at least double]( what Wall Street expected and way more than you can bench. - What this means is inflation’s showing no signs of slowing down. In fact, with prices of goods, services, and production all running high, inflation appears to be ["gathering both breadth and momentum."]( Transitory my big juicy my a*s. - Analysts believe these numbers will help prompt hawkish Fed action. While a half-point hike in March still isn’t guaranteed, many believe that the interest rate will see a [1.75 point increase]( by the end of the year. Any day now, Jerry. - There’s a silver lining, at least. The easing of tensions between Russia and Ukraine means that [markets are up]( (for now) and will buoy consumer sentiment along with them. The next stage of this roller coaster is the market contraction when the Fed actually institutes rate hikes. On the one hand, continuing high inflation should urge them to drop the rate hike hammer pretty hard. On the other hand, we won’t know whether it’s too hard for many months. At this point, an earlier large hike would probably boost consumer sentiment enough that it would also boost the stock market long-term, paradoxical though that may sound. I’d say a half-point hike might actually help riskier stocks after an initial dip. Airbnb brings home the bacon ^The world peacing the f*ck out of their houses Airbnb’s stock ticked up [6.14%]( yesterday in intraday trading and another 3-4% after hours following a strong Q4 earnings report. The online marketplace for vacation and housing rentals [brought home]( an EPS of $0.08/share v the expected $0.03/share and $1.53B in revenue over the expected $1.46B. Nights booked just missed the mark however, falling just short of the projected 74.96M nights and down 8% from last quarter. - Guidance was strong as well. Airbnb expects Q1 2022 revenue to hit between [$1.41B and $1.48B]( over estimates of $1.24Bâ which would make for better numbers than pre-pandemic Q1 2019 levels. - Vacations are getting longer, too. Average Airbnb trip length has increased [15%]( in the past two years, with stays 28 days or longer now making up 22% of nights booked. People wanna GTFO. This isn’t that surprising. The pandemic actually didn’t tank Airbnb as much as many people expected, since everyone wanted to get out of their house and Airbnb let them do so in a socially distanced way. For quite a few quarters now, the company’s recovered beyond pre-pandemic levels and it looks like that trend will continue. For my part, Airbnb’s a buy. Old Man Yells at Crypto Token Talk If you watched this year’s Super Bowl, assuming you weren’t blacked out in between game time, then you may have noticed a great deal of the crypto commercials. What you probably didn’t do in response to these ads was get up from your couch, throw your chicken wings in disgust, and get on your soapbox lamenting on how these companies didn’t adequately state the risks associated with the digital currency. You didn’t do that for two reasons: (1) You’re not an idiot and know investing, no matter what it’s in, brings with it risks (plus you read The Daily Setup, thus making you smart) and (2) you’re not Senate Banking Chairman Sherrod Brown, who already took the role of an angry old guy yelling into the ether for you. - Crypto.com, FTX, eToro, and Coinbase all paid the $7M price tag for a 30 second ad spot to promote their exchange. [Coinbase’s floating QR code](, which was the most exciting moment of the evening, racked up 20M hits in a minute and crashed the company’s site. - [Sherrod Brown stated](, "The companies didn’t mention that investors could "lose big" as a result of wild price swings, that consumers may fall victim to fraud or theft, or that the market currently isn’t subject to the same level of regulatory oversight as other areas." Politicians, always looking out for the American people. Makes you feel all warm and fuzzy inside. - Other countries, like the U.K. and Spain, have raised similar concerns about the marketing of crypto. Their regulatory bodies have suggested visible warnings in the ads, some going as far as to advocate marketing strictly to wealthy investors. When the dot.com bubble burst in 2001, the companies that survived were the ones with innovative products or services that would allow them to adapt over the coming decades. Companies like Amazon and eBay were able to weather the storm and come out the other side stronger, and it wouldn’t surprise me if the crypto names I mentioned above go through something similar. Intel Has the Munchies, Buys More Chips Deals and Rumors Shares of Israeli-based semiconductor-maker Tower Semiconductor Ltd (TSEM) soared in trading Tuesday following an announcement that [Intel would be purchasing the company for $5.4B](. News leaked after the close Monday causing the stock to gap-higher on Tuesday’s open and remain just off its highs for the remainder of the day. When the closing bell rang, TSEM was up [31.77%]( to a new all time high of $47.07. Intel (INTC) joined in on the festivities, finishing the day up [1.79%](, a sign that the deal is a huge coup for the company as the acquirer usually sees an initial drop in its stock price on news of a takeover. - Intel has lost ground over the years to Taiwan Semiconductor and Samsung. The deal will give the company a [stronger foothold in the specialty technologies]( in which Tower excels, such as radio frequency and industrial sensors. - Last month, Intel announced that they will be investing more than $20B into the creation of massive two chip factories in Ohio. Their investment may grow to $100B and house 8 chip factories known as "fabs." Credit to me about not making a dad joke about how I’m sure they’ll be fabulous. - [Intel will be paying $53/share]( for Tower, which represents a 60% premium over Tower’s closing price of $33.10 on Monday. The deal is expected to close in 12 months. Global demand for chips has never been higher and the move by Intel is one that should have a positive long term impact on the company’s stock price. Over the last year, there has been significant support in the [$42]( area and for most of the last month the stock has been trading between $47-$50. If I consider myself bullish long term on INTC, I could enter a long position with a stop below the $42 level. Link Roundup 📿 Other News Other News Link Roundup - Looks like the UN World Food Program is full of sh*t – Elon Donated $5.7B of Tesla Shares to Charity ([link]() - Dear Warren...Buy Activision now...Love, Bill G. – Berkshire Bought $1B Activision Shares Before Microsoft Deal ([link]() - Order Now, Receive in 2024 – Fisker Starts Taking Orders For New EV ([link]() - GE’s Stock Rallied Big, Boomers Everywhere Rejoice – GE Provides Positive Annual Report ([link]() - Back to the Future- The DeLorean is coming back as an EV ([link]() Meme of the day: Oil to $100, [via @Wallstmemes]( Questions or concerns about our products? Call or text us on your mobile: (410)-775-8315 © Copyright 2020, [RagingBull]( - [Refund Policy]( - [Privacy Policy]( - [Terms & Conditions]( DISCLAIMER: To more fully understand any Ragingbull.com, LLC ("RagingBull") subscription, website, application or other service ("Services"), please review our full disclaimer located at [(. 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