The Judgement Day on Wall Street

Join TradeAlgo's Free Live Trading Session ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ [EARN WHILE YOU LEARN! JOIN OUR FREE LIVE TRADING SESSION!]( Hello investor, The Judgement Day on Wall Street Wall Street hit a new all-time high yesterday just before Nvidia’s enormous earnings report. The expectations are sky-high for Nvidia to report big growth due to soaring demand for its data-center business. Its AI chips are among the most-sought-after in the market as companies invest billions of dollars to win the AI race. Many Wall Street analysts view Nvidia as the barometer for the market’s current valuation. Namely, the AI chipmaker needs to post phenomenal results (and strong guidance) to justify lofty valuations in stocks. - “With markets trending upward and emotions in check, Nvidia’s performance will be pivotal in gauging the sustainability of the current market run and the potential for a more inclusive market rally,” said Mark Hackett at Nationwide. Mark Hackett at Nationwide (Photo: Nationwide) Sure enough, options trades are pricing in a whopping 9% swing in either direction after the Nvidia’s report. Many investors have poured into Nvidia in hope to catch a big ride if the chipmaker reports strong results. But the fall can be devastating if Nvidia fails to meet the expectations. - “People don’t [want] to miss out on participating on the print if they come out with good number,” said Matt Rowe, head of cross asset strategies at Nomura Private Capital. - “But the flip side of the coin is if it’s not exciting, and there isn’t sort of constructive feedback that supports the idea of continued expansion, then this could get sold off very hard, very quickly.” On the other news, Fed Governor Christopher Waller said that inflation will need to soften over the next three to five months before the central bank would consider cutting rates. It would be August three months from now. So, it could be in time for the September rate cut that Wall Street has priced in. But of course, inflation will need to cool down without a miss. Until then, we will pay attention to Nvidia’s results to gauge the market’s sentiment. A Dark Horse Pick With A Huge Cost Structure Advantage Over Other Competitors Today’s Stock Pick: Technoglass ([TGLS]( What Technoglass offers is straight forwarding. It is the manufacturer of high-spec architecutral glass and windows for residental and commercial applications. If the buildings require fancy glasses, that’s right in Technoglass’s backyard. But business is far more than just offering good products. It is how you structure the company that offers you the cost advantage over other competitors. It is how Coca-Cola has dominated in the soft drink category for hundreds of years. It doesn’t matter whether a soda is good tasting. Coke built a powerful distribution network that allows it to feed products to restaurants, vending machines, and supermarkets instantly all over the world at cost-effective. Precisely, that was what Technoglass did. The company is vertically integrated where it owns the process from raw materials to end products. It has 4.1 million square foot manufacturing unit in Barranquila, Colombia. Low labor costs give Technoglass an enormous advantage over U.S. competitors. Believe it or not, Technoglass’s labor cost per hour is just $3.5 versus $24 in America – or ~7x cheaper. Its investments in solar power and on-site natural gas led to ~56% lower energy cost per KwH than the U.S. Lastly, its transportation costs are about ~39% lower due to favorable shipping rates for exports since Colombia has net import trade imbalance, versus land transportation costs from Midwest to major coastal cities. (Source: Technoglass) Through joint ventures and ownerships, Technoglass owns the process from raw materials to sales, distribution and installation. It also hedges against the cost of aluminum to stabilize the product cost. As a result, the company could capture cost benefits from being vertically integrated. (Source: Technoglass) What is the result of all of these advantages? Very high margins. The company enjoys nearly 37% EBITDA margin – an insane margin for physical products. The company could offer prices equal (or less) than U.S. competitors while having immense cost advantages. That builds a huge margin for Technoglass. And here’s good news – the company is also growing at a robust pace. Its EBITDA grew ~27% CAGR from 2012 to 2023. (Source: Technoglass) 2024 guidance: Technoglass expects its adjusted EBITDA to jump between 13% to 21% year over year. That’s solid. It’s the backlog that makes it intriguing. It has about $870 million in backlogs, as of December 2023. That is more than Technoglass’s FY 2023 revenue of $833 million. About 99% of backlog rolls off within 18 months historically, and backlog to revenue conversion is typically above 90% within the next 18 months. So, there is a very good chance that a bulk of its $870 million backlog would translate into actual revenues. Bottom line: Technoglass has an unique cost structure that gives it a high barrier to entry advantage over other competitors. The stock is currently trading at a 12 P/E which is a good value for the stock. [EARN WHILE YOU LEARN! JOIN OUR FREE LIVE TRADING SESSION!](       © All Rights Reserved, Trade Alliance [Unsubscribe]( | [Manage Preferences](