STOCK MARKET TALK

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Stocks On Spaces
@StocksOnSpacesAug 23, 2025

The Spaces covered a choppy, red-leaning session, sector rotation, and a detailed preview of Jerome Powell’s Jackson Hole speech. Evan hosted with traders and analysts including Mike, Brett, Spartan, Sam, John, Stock Sniper, Wilfie, and Stock Talk. Participants highlighted a whippy tape, resilience in select names (e.g., Lyft), and softness in retail leaders (Walmart) with possible readthroughs to Costco and BJ’s. The macro focus was on whether Powell hints at cuts, with consensus that tone and upcoming data (jobs, PCE/CPI/PPI) will matter more than explicit guidance. Discussants favored a healthy 4–7% pullback and noted seasonality risk into September alongside visible rotation from mega-cap tech into healthcare, financials, and energy. Stock ideas spanned fintech (MELI, NU, SE, GRAB, FOUR, TOST), ad tech strength (APP vs TTD), and cloud infra (DOCN). A live debate centered on shorting Roblox given allegations-driven headline risk and technical fragility. Longer segments explored streaming rights economics (Netflix, Disney/ESPN, TKO) and AI’s impact on content costs, plus rare earths and nuclear themes (Energy Fuels, Centrus) and defense (Kratos, drones). After-hours: Intuit beat but fell, Workday w/ acquisition and reversal, Ross up, Zoom modestly higher. Lucid announced a 1-for-10 reverse split.

Market Recap and Participants

  • Host: Evan (Stock Market News)
  • Panelists: Mike (Options Mike), Brett, Spartan, Sam, John, Stock Sniper, Wilfie (aka Wolfie/Woffy), Stock Talk (Stock Talk Weekly)

Overall Tape and Breadth

  • Indices: SPY ~-0.3%, TQQQ ~-0.4%. QQQ had a brief red-to-green before reversing.
  • Mega-cap tech largely red; healthcare outperformed (Merck cited). Energy modestly green.
  • Notable laggards: Walmart -5% (an outsized move for a defensive mega-cap), Costco also weak on read-through.
  • Relative strength pockets: select China ADRs (PDD, NIO), small caps, a few stock-specific winners (Lyft).

Day Trading/Flow Observations

  • Mike (Options):
    • “Whippy” tape with big 5-min candles and fast fades; better to be pre-positioned or sit out early.
    • Trades: small loss on early NVDA call-flows attempt; later winner in Tesla (entry ~9:47:20). Very light activity overall.
    • View: Market in wait-and-see mode ahead of Powell; odds market wants explicit rate-cut hints (risk if none delivered).
    • Movers on radar: HOOD (near HOD), IWM (HOD intraday), energy rotation.
    • Macro color: Ukraine war unresolved; political backdrop complicates Fed calculus. Would welcome a deeper pullback to the 50-day moving averages.

Jackson Hole, Fed Path, and Macro Set-up

  • Event: Powell speaks at 10:00 ET, speech format (no Q&A). Topic areas for the symposium include labor markets in transition, demographics, productivity, and macroeconomic policy.
  • Positioning/Seasonality:
    • Brett: Prefers pullbacks into events (vs. melt-ups) to reset expectations. A 4–7% pullback would be healthy; September is seasonally tough. Expects less transparency vs. last year given inflation and labor moving the “wrong” way for the Fed.
    • Spartan: Expect muted action into Powell; prior Jackson Hole pattern: 3–5% pullbacks over the following week in several of the last instances. Base case: shallow pullbacks continue unless a surprise; year-end rally still likely.
    • Sam: Rotation underway (tech to defensives/healthcare/financials, some high-beta like bitcoin miners finding bids). Sees rising risk of a pullback; patient, wants better entries for high-conviction longs.
    • Wilfie: Market repriced September odds quickly (from ~97% to ~71% for a cut over a few days, per his cited moves), echoing 2022’s optimistic set-up into Jackson Hole. If there’s no “spark” soon, performance chase could flip back up through the fall given the calendar (soft spot with fewer macro catalysts before late October).
    • Mike: Plenty of data before the next decision (jobs, PCE, PPI, CPI). Fed is in a tough spot: inflation “peeking,” labor potentially weakening, and politics complicating signaling.

Sector Rotation and Technical Posture

  • Tech fatigue: Several leaders now below short-term moving averages; semis showing near-term cracks.
    • Wilfie: TSM broke below 20/50-day cluster (near prior ATH); NVDA below 20-day into earnings next week; watch the gap to 50-day (~6–7%). CRM and other beaten software saw tradable bounces.
  • Energy: Bid continues (geopolitical backdrop cited).
  • Defensives/Healthcare: Catching flows after prolonged lag.
  • Small caps: Pockets of constructive action.

Single-Name Ideas and Theses

  • China ADRs and Weekly Flow (Spartan):

    • Strong call activity in PDD (weekly range break), NIO. Watching BABA short-term. Notes repeated pattern: oversold value names with curl/EMA crosses deliver good R/R, often with catalysts.

  • Fintech/SMB Software and AdTech (Sam and John):

    • Core long ideas (fundamental, secular):
      • MercadoLibre (MELI): Premium justified by Mercado Pago; still attractive despite past run.
      • Grab (GRAB): Reasonable valuation for growth profile.
      • Sea Ltd (SE): Post-earnings rerating still leaves fair value; early innings.
      • Nubank (NU): Sam added; secular LATAM banking disruption.
      • Shift4 (FOUR): Founder Jared Isaacman increased stake in the $80s; execution track.
      • Toast (TOST): On watch to buy on further pullback; strong long-term fit for portfolio.
      • DigitalOcean (DOCN): SMB IaaS, price-to-sales ~3; seen as mispriced, potential acquisition target cohort; Sam added but prefers patience for broader market weakness.
      • GitLab (GTLB): Repeated post-earnings fades; valuation pressure for open-source adjacent names.
    • Monday.com (MNDY): Good growth and profitability, but SMB exposure adds volatility; risk in downturn as SMBs can switch/bundle; AI displacement fears may be weighing broadly on software multiples.
    • AdTech: AppLovin (APP) delivering outsized growth and expense control; viewed as best-in-class versus Trade Desk (TTD)-specific issues. Walled gardens (META, GOOG) also executing. Magnite (MGNI) in the mix.
    • Payments landscape (John): Survey data suggests PayPal usage falling quickly among younger cohorts; NASDAQ (NDAQ) attractive as exchange+software hybrid, leveraging agentic AI for financial crime (cash-cow exchange funds R&D). Remitly (RELY) flagged but not yet researched by Sam.

  • Roblox (RBLX) Bear Case and Technical Risk

    • Stock Sniper: Opened RBLX Sep 5 105/114 puts; thesis is technical (below 50-day risk) plus reputational headwinds (widely-circulating allegations around safety/predation on the platform; Chris Hansen reportedly producing a docuseries). Prospero AI flags low long-term profitability score (17/100) and very weak net social sentiment (22). Target: 112–113.
    • Stock Talk: Chart sits on 50-day/9-week EMA cluster (support for now). A catalyst could break support and trigger unwind; not yet a confirmed bearish trend until that break.
    • Wilfie: Also short; notes stretched distance to longer MAs increases “waterfall” risk if selling accelerates, similar to recent Palantir behavior.

  • Retail, Membership Clubs, and Consumer Read-Throughs

    • Walmart (WMT): Missed EPS for first time in 3 years; Sam’s Club softness (comp slowed Q1 6.7% to 5.9%). Question: Is this Walmart-specific or industry-wide? BJ’s (BJ) report tomorrow gives clarity. Costco’s premium multiple could see pressure if weakness is broad. Amazon read-through relevant if consumers rationalize memberships (Prime vs club cards).

  • Rare Earths, Nuclear Fuel, and Strategic Assets (Stock Talk)

    • Thesis: Dual-theme exposure spanning heavy rare earths and nuclear fuel benefits from U.S. policy tailwinds.
    • Energy Fuels (ticker: UUUU): PR highlighted pilot-scale production purity for heavy rare earths (dysprosium, terbium) at White Mesa Mill (Utah). Commercial scale targeted late 2026/early 2027. Adds credibility as a domestic heavy rare earths play; White Mesa seen as a strategic national asset.
    • Centrus Energy (LEU): Complementary “strategic asset” view on enrichment capacity.
    • NioCorp (NB, cited): Rare earths/critical minerals developer with notable backers (Peter Thiel, Ken Griffin).
    • Policy chatter: Panelists referenced headlines about potential reallocation of ~$2B from CHIPS funding to minerals/rare earths; MP Materials (MP) popped intraday on that.

  • Sports Betting and Media Integrations (Stock Talk)

    • PENN Entertainment (PENN): Holding above 200-day; if >$19.50, room to low-$20s. Core thesis: ESPN Bet integrated into ESPN app should drive market share, making current ~$2.6B EV too low.
    • Lyft (LYFT): Strong relative strength; shallow pullbacks on light volume; weekly “pinch” structure with 200-week overhead; expectation of continued re-rating.
    • Fubo (FUBO): Weekly/monthly structure constructive if $3.20–$3.30 holds. Stock Talk floated a speculative scenario of a JV/combination with a large live TV streaming peer; flags merger risk and emphasizes this is a thesis, not a known deal.

Streaming, Live Sports Rights, and AI in Content (Stock Talk-led discussion)

  • Netflix reportedly nearing a ~$35M/yr deal for MLB Home Run Derby; likely a wedge into broader live sports strategy, not just a one-off event.
  • Broader context:
    • The streaming “IP arms race” intensifies: Apple, Amazon, Netflix, Disney, etc. fighting to own/distribute live sports and premium content catalogues to reduce churn and grow subs.
    • Disney/ESPN moves (e.g., RedZone access) aim to onboard sports fans not native to Disney’s platform.
    • TKO Group (UFC/WWE) locked significant rights deals (WWE to ESPN; UFC rights ~$7.7B over 7 years), underscoring escalating value of sports IP.
    • AI’s impact: Content creation costs set to fall as studios use AI to accelerate design/script workflows; “quantity to retain subs” dynamic likely increases. Legacy IP retains premium; new IP becomes cheaper to generate; expect aggressive overbidding for rights as competition escalates.

Earnings and Corporate Actions

  • After-hours:
    • Intuit (INTU): Beat on EPS/revenue; FY guide above on EPS/revenue; shares -~6% AH (no clear driver surfaced in the discussion; likely segment or margin concerns in details).
    • Workday (WDAY): Initially popped, then reversed lower; announced an acquisition.
    • Ross Stores (ROST): Trading up after results.
    • Zoom (ZM): +~1.5% AH.
  • Lucid (LCID): Shareholders approved 1-for-10 reverse split. Host explained mechanics and typical signaling (not a sign of fundamental strength).
  • Nvidia: Monday “unboxing”/announcement tied to robotics products flagged; potential sympathy reaction in Tesla.
  • Apple TV+: Reported ~30% price hike; incidental note in chatter.

Research, Notes, and Other Mentions

  • Cooper-Standard (CPS): New Stifel initiation; mgmt shared 2030 targets implying 120% EBITDA growth over 5 years; stock +17% on coverage.
  • PubMatic (PUBM): Rosenblatt note argued prior market overreaction; raised target to $17; stock +9%.
  • LendingClub/SOFi: Brief mentions; Stock Talk not enthusiastic on SoFi (prefers HOOD’s broker-as-bank trajectory). Debate on younger investors self-directing vs. advisor-led.

Defense/Autonomous Systems — Kratos (KTOS) Deep Dive Q&A

  • Stock Sniper asked about KTOS expanding to satellites/cyber.
  • Stock Talk’s view:
    • Kratos should focus on core strengths (drones, autonomous systems, specialized munitions). Space/satellite is highly competitive; SpaceX dominates deployment; ASTS seen as alt to Starlink; Rocket Lab as alt launcher.
    • KTOS does have some space exposure (e.g., Space Development Agency contract) and cybersecurity for its own systems; not a primary revenue pillar.
    • Collaboration dynamics: Primes (LMT, NOC, GD) often subcontract; KTOS historically pioneers “build with own capital, then win programs” (OG Anduril-style). They have collaborated with primes (Airbus, Lockheed, etc.) and would again if needed for larger awards.
    • Strategic backdrop: Global defense spend pivoting to drones, counter-UAS, cyber, autonomous, precision munitions, and missile defense. KTOS well-positioned for the “new age” of warfare; drones have superior economics and scalability for many nations versus manned fighters.

Strategy and Risk Management Takeaways

  • Many leaders at key technical inflections (50-day clusters) into Powell. Binary risk of speech tone; expect initial chop, then directional follow-through post-event and into NVDA earnings.
  • Tactics:
    • Focus on relative strength names and clean risk/reward setups (Spartan).
    • Maintain shopping lists for high-quality seculars; scale on pullbacks rather than chase (Sam, Brett).
    • Respect potential for either: a) a Jackson Hole spark to trigger 3–5% near-term selloff, or b) no spark leading to performance chase higher into year-end (Wilfie).

Notable One-Liners and Color

  • “If Powell avoids policy specifics, markets may initially struggle for direction.” (Mike)
  • “Prefer pullback into events; it resets expectations.” (Brett)
  • “China ADRs showing unusual call flow; semis attractive on an upside scenario post-Powell.” (Spartan)
  • “I’m 90%+ invested; happy to buy more on dips but patient.” (Sam)
  • “RBLX at stretched MAs can ‘waterfall’ if 50-day breaks.” (Wilfie)
  • “PENN’s ESPN Bet integration should not yield zero share gains; valuation implies too little.” (Stock Talk)

What to Watch Next

  • Friday: Powell’s 10:00 ET speech (no Q&A). Market reaction path (chop-to-flat vs. directional break) and sector rotations underneath.
  • Next week: Nvidia earnings; semis’ reaction relative to already-slipping short-term MAs.
  • Retail read-through: BJ’s report for membership club health; Costco follow-on risk.
  • Follow policy headlines on rare earths/minerals; watch MP, UUUU, LEU for confirmation of sustained policy support.
  • Technical levels: RBLX 50-day, PENN >$19.50, LYFT weekly pinch, FUBO $3.20–$3.30, TSM prior ATH hold, NVDA 20-/50-day gap.