Meme Stocks

Because we are flying off Thursday this file is attempting to catch up with news from after I filed yesterday. This material is incomplete.

China walked back the attack on Tencent for peddling "spiritual opium" but don't cheer too soon. Beijing is still Maoist and favors communist control of business rather than capitalism. As reader Joe pointed out the opium the kids collect means they can resolve tech problems that challenge their elders. Like Joe and me. 

The Down Jones lived up to its name yesterday falling 300 points despite (or because) the Robinhood stock was all over the map and closed up 50%. Remember that the meme stock's buyers usually are beginners without much investing experience or even investments. 

Image Source: Pixabay

*One reason stocks fell is that WTI oil is in surplus and the price fell by 3.3%. This took down the US oilpatch, notably Schlumberger Ltd SLB which helps find the stuff. It fell 2.6%.

*Sampo Group being Finnish reports half-yearly and not quarterly. It just reported profit before taxes in the half-year was euros 1.343 bn from prior years euros 569 mn, boostd by a 34% rise in underwriting for its property and casualty insurance business of euros 658 mn from 489 mn last Q1. EPS rose to euros 1.80from 0.81, more than doubling. of 2021, Its new UK Hastings acquisition boosted underwriting, offsetting the impact of Covid-19 and the result was that underwriting profit rose 12%. Its combined ratio improved by 1.9% to 80.7% from prior 82.6%. 

SAXPY beat its financial targets for 2021-3for single-digit rises in underwriting profits and a combined ratio below 86%.

IF had an underwriting profit of euros 443 mn vs 393 mn and a combined ratio of 81.1% a full percent below last year's figure. IF also saw a 4.4% growth in premium in H1 mostly in Q2 when it was 7.2%.The improvement was because of reduced risk ratios, both overall and in handling large and weather claims, virus effects, and other matters anticipated by analysts. That doesn't mean there will not be increases given what is happening now..SAXPY expects to do better for the rest of this year with a combined ratio of 81.5-83.5 and premium growth to offset the risks from global warming and the delta variant. 

Topdanmark’s profit H1 pre-tax profit was euros 208 mn (up for 38 mn). The combined ratio rose 82.2% down 2% from last year. New play Hastings auto insurance earned profits of euros 101 mn and Sampo kept the new clients on board mostly by cutting premiums especially in Q1 but they stabilized in Q2 (if at a lower level than before the takeover.) Hastings beat its annual combined ratio of 88% with one at 76.5%. thanks mostly to lower claims because people drove less because of lockdowns and Quarantine. Its pre-tax profit hit euros 85 mn, net 20 mn in non-operational depreciation and amortization. From years of covering Nokia I have learned to mistrust Finnish IR people telling us about quarterly results. While a financial company is less likely to cheat than a tech company, Finns are quick to take advantage of foreigners. In H2 Sampo sales rose all of 2.6% from prior year Q2, not exactly gangbusters.

*The warning against AbCellera by Jim Cramer was because ABCL signed a JV with EQRX to develop therapeutic antibodies for targeted diseases.ABCL also has an option to invest more to gain more of the sales prices of their joint finds in oncology and immunology. ABCL has been doing deals to use its antibodies to target diseases and is working with Tachyon Therapeutics on advanced cancers, for which it will get milestones and royalties when they hit the market. Here too it has an option to get more of the revenues from sales by investing. ABCL rose 2% despite Mr. Cramer. I think the idea of cooperation among small cap drug discovery stocks is brilliant. 

*Bloomberg revealed that Japan's Softbank has boguth a $5 bn stake in Roche, RHHBY, on the grounds that its Genentech division is undervalued. I am not sure why Softbank didn't just by Genetech which is listed separately. Maybe there is an arbitrage play/

*TEVA managed to get over $10.09/sh yesterday, if briefly. 

*Eli Lilly says its Alzheimer's antibody-drug donanemab pay do better than Biogen and Eisai's Aduhelm over which the US FDA is now being investigated. Meanwhile the Aduhelm pair say they too have another drug to treat Alzheimer's in the works. We own ESALY. 

*Plug Power reports later today. Jim Cramer fears it will disappoint again. We own PLUG.

*Of all things Mr. Cramer likes South Korean Coupang "very much". I think CPNG was mispriced by Softbank et al. at its IPO. The Korean-Japanese outfit is a fad.