Fortune Favors the Bold 💰

Futures are down for the second day in a row in this holiday-shortened trading week.

Author

Chris Dinello
May 30, 2024

Good Morning! 

It's Chris from Elite Trade Club, here to give you this morning's premarket trading news.

Let’s get ready to trade!

Markets 📈

The Dow sold off on Wednesday, with the Nasdaq and S&P 500 trailing close behind, as stock’s suffered their first major setback of the holiday-shortened trading week.

  • Dow [-1.0%]

  • S&P 500 [-0.7%]

  • Nasdaq [-0.5%]

  • Russell 2K [-1.4%]

Futures are down again in early trading, raising the likelihood of another drawdown in today’s session. S&P 500 contracts are currently down 0.3%, while Dow contracts are showing a 0.8% loss.

What to Watch Today:
The schedule picks up a bit today after a quiet start to the trading week. Costco will report its latest quarterly financial results after the closing bell, with Hormel and Dollar General reporting this morning. We’ll also get an update on Q1 GDP before the opening bell.

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Premarket Highlights 🔎

Nelson Peltz Sells Disney Stake After Losing Proxy Battle 📉

Activist investor Nelson Peltz has sold his entire stake in Disney, according to CNBC sources familiar with the matter. Peltz sold his Disney shares at roughly $120 each, netting about $1 billion from the position. This move comes as Disney's stock currently trades around $100 per share, indicating a significant profit from his investment.

Proxy Battle 🗳️
Peltz's exit follows the loss of a high-profile proxy battle in early April, where his firm, Trian Partners, failed to secure board seats at Disney. Shareholders re-elected the company’s full slate of board nominees, rejecting Peltz's bid to join the board along with former Disney finance chief Jay Rasulo.

Peltz had been critical of Disney's governance, particularly targeting the company's streaming strategy and what he considered a flawed succession plan for CEO Bob Iger.

Activist Stake 📈
Peltz initially increased his stake in Disney to about 30 million shares last October, reigniting his proxy campaign with the goal of driving changes in the company's strategic direction. Despite the loss, his campaign highlighted significant issues within Disney’s leadership and strategy, which garnered considerable attention from shareholders and the media.

Trian's Statement 📊
Following the April shareholder vote, Trian Partners issued a statement expressing pride in the influence they had on Disney. “We are proud of the impact we have had in refocusing this Company on value creation and good governance,” the statement read.

Trian's campaign, although not successful in securing board seats, put pressure on Disney's management to address governance and strategic concerns.

Disney's Performance 📈
Despite the turmoil surrounding the proxy battle, Disney shares have risen about 11% so far this year, slightly outperforming the S&P 500.

The stock's performance reflects a moderate recovery as investors respond to the company's efforts to address strategic and operational challenges.

Peltz's profitable exit underscores the potential he saw in Disney, even though his attempts to influence its direction directly were thwarted.

Featured Earnings 💰️ 

  • Dollar General [DG] ... AM

  • Hormel Foods [HRL] ... AM

  • Costco Wholesale [COST] ... PM

  • Dell Technologies [DELL] ... PM

  • Marvell Technology [MRVL] ... PM

  • Veeva Systems [VEEV] ... PM

  • MongoDB [MDB] ... PM

  • Zscaler [ZS] ... PM

  • NetApp [NTAP] ... PM

  • Ulta Beauty [ULTA] ... PM

Economy 🏗

  • Initial jobless claims [May] ... 8:30a

  • GDP (first revision) [Q1] ... 8:30a

  • Advanced U.S. trade balance in goods [Apr] ... 8:30a

  • Pending home sales [Apr] ... 10:00a

Running Hot 🔥

Gainers

  • Loop Media [LPTV] >> +44.2%

  • Kintara Therapeutics [KTRA] >> +27.6%

  • Nexalin Tech [NXL] >> +17.2%

Decliners

  • Maxeon Solar [MAXN] >> (59.4%)

  • NovaBay Pharma [NBY] >> (38.6%)

  • UIPath [PATH] >> (29.6%)

Smart For Life [SMFL] - Last Close: $3.91

Smart for Life is rallying in what appears to be a short squeeze.

In Tuesday’s aftermarket, SMFL announced the successful completion of its restructuring program, which included several significant measures.

The news sent shares to a 16.7% gain on Wednesday, but the rally is going into overdrive this morning.

SMFL is up 70.0% on roughly 7 million shares traded, with a short percentage of 31.5% as of May 15th.

My Take: It look’s like SMFL’s early-week catalyst has sparked a short squeeze in micro-float stock. However, expect volatility because its total market cap is less than 500K.

OneMedNet [ONMD] - Last Close: $1.95

This tiny healthcare tech firm is rallying after disclosing a non-exclusive three-year master services deal with an undisclosed US-based MedTech company.

Under the terms of the agreement, OneMedNet will utilize its proprietary iRWD platform to securely process regulatory-grade clinical data.

ONMD is up 43.0% on just under 10 million shares traded.

My Take: ONMD was up 297% over the past 5 days coming into today’s premarket. Now, it’s about to get another big boost, but I suspect we’ll see a pullback before long.

Cue Health [HLTH] - Last Close: $0.0548

Cue Health is rebounding from a 39.5% sell-off on Wednesday that began after it annouced it had filed a petition for Chapter 7 bankruptcy.

The company also annoyed the termination of a Loan & Security Agreement dated June 30th, 2022.

HLTH is up 79.5% on over 120 million shares traded this morning.

My Take: Chasing bankruptcy stocks is always a risky endeavor, and HLTH is no exception. I would advise steering clear so you don’t get caught holding the bag for the pump & dumpers.

Momentus [MNTS] - Last Close: $0.52

Space contractor Momentus has secured a deal with DARPA to support the design and in-space demonstration of large-scale space structures.

Momentus will work with other companies under DARPA’s NOM4D On-Orbit Demw program to design experiments that can be integrated onto the Momentus Vigoride Orbital Service Vehicle.

Financial details weren’t disclosed, but shares are getting a big boost from the news.

MNTS is up 42.3% on over 10 million shares traded.

My Take: MNTS has had a rough run since it made its stock market debut, but this could be the catalyst it needs to pivot back into a positive trend.

That's it for today! Thanks for reading, and good luck out there!

Best Regards,

— Chris D.
Elite Trade Club

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