A humorous look at the companies that caught our eye, for better or worse, this week
Gatos Silver (DOG)
News that is difficult to break to people: 1) Honey, I have another family, and my name isn’t actually Dave; 2) I’m sorry, sir, we can’t let you and your daughter into the Taylor Swift concert. Those front-row tickets are counterfeit; 3) You know that mine our company operates in Mexico? Well, it doesn’t have nearly as much silver as we thought. In a revelation that erased more than two-thirds of Gatos Silver’s market value, the Colorado-based miner cited “errors” in a 2020 technical report that led to “overestimation in the existing resource model” for its Los Gatos silver, zinc, lead and gold project. With the actual resource now estimated to be 30 per cent to 50 per cent lower, investors are having a hard time processing the news.
Here’s one way to pay off those crushing credit card bills: Invest in a credit card company. Shares of Visa jumped after the company said it processed nearly 48 billion transactions in the fourth quarter, up 21 per cent from a year earlier, driven by strong growth in e-commerce and a recovery in international travel that was stronger than expected. Just think: If you’d invested $10,000 in Visa stock 10 years ago, today you’d have more than $95,000. But, no, you had to go and blow the money on fancy smartphones and shoes. Visa investors thank you for your generosity.
Arrival: A British electric vehicle startup that began trading in March, 2021. Dead on Arrival: What the stock has been ever since. One of many unproven EV companies that went public via a merger with a special purpose acquisition company, Arrival has shed more than 80 per cent of its value since its Nasdaq listing as investors grow wary of SPACs that are struggling to generate any revenue. The stock’s latest down leg started in November when the company said it “expects significantly lower vehicle volumes and revenue in 2022″ than previously forecast and warned that projections at the time of the merger “should no longer be relied upon.” That doesn’t sound very encouraging.
Boot Barn Holdings (DOG)
Hey city slicker, ever consider treating yourself to a shiny, new pair of cowboy boots? Ride your horse on down to Boot Barn. We got an amazing selection of western boots, work boots, hiking boots and casual boots. Heck, we even got boots made with python leather, ostrich skin and lizard leather that are bound to be a conversation starter with the neighbours. We’d sure appreciate y’all coming down and spending some of your big city salary, ‘cause the market was none too pleased with our quarterly results. A couple of Wall Street analysts even cut their price targets on our stock, partly ‘cause they’re worried about inflation and stimulus money running out. Bring the wife and kids. We got boots for them, too.
With a name like Toast, it was only a matter of time before investors were in a jam. Toast – whose software helps restaurants manage orders, deliveries, payroll and point-of-sale functions – went public at US$40 a share in September and quickly zoomed to more than US$60, pushing its valuation to nearly US$33-billion. But with investors losing their appetites for high-growth technology stocks at a time when restaurants have been hammered by successive waves of COVID-19, the shares have since given up two-thirds of their value. Losing that kind of bread must really upset Toast investors.
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