Under-$3 Biotech Stock Surging 222%

Author

Adam Garcia
November 26, 2024

Good morning. It's November 26th, and in today’s edition, we’ll look at why two major stocks in the retail sector are struggling in premarket trade today, even as a tiny biotech stock has nearly tripled itself.

Previous Close 📈

The major U.S. indices continued to gain momentum on Monday. The Dow Jones Industrial Average surged by 440 points (1%), closing at a new all-time high. The S&P 500 added 0.3%, hitting a fresh intraday record, while the Nasdaq Composite also climbed 0.3%. Small-cap stocks outperformed, with the Russell 2000 reaching its first record since 2021, reflecting renewed investor interest in smaller, domestically focused companies.

Futures

U.S. stock futures are flat today as traders digest Trump’s latest tariff threats. Dow futures are up 37 points (0.1%), while S&P 500 futures and Nasdaq-100 futures are each higher by around 0.1%.

Expert Stock Grader

Looking to make smarter investment decisions? Louis Navellier's Stock Grader analyzes over 6,000 stocks and offers clear A to F grades for each one.

For a limited time, you can grade 3 stocks for free!

What to Watch

Earnings season continues as Analog Devices (NASDAQ: ADI), Best Buy (NYSE: BBY), Burlington Stores (NYSE: BURL), Dick's Sporting Goods (NYSE: DKS), and The J.M. Smucker (NYSE: SJM) report their numbers before the opening bell today.

Dell Technologies (NYSE: DELL), CrowdStrike Holdings (NASDAQ: CRWD), Workday (NASDAQ: WDAY), HP (NYSE: HPQ), and Nutanix (NASDAQ: NTNX) will report their results after the market closes.

On the economic calendar, the S&P Case-Shiller Home Price Index for September will be released at 9:00 a.m. ET, followed by Consumer Confidence for November and New Home Sales for October at 10:00 a.m. ET.

Retail

Best Buy Shares Fall Upon Revised FY25 Outlook Amid Sales Decline

Best Buy reported its Q3 FY25 earnings today. Its revenue of $9.45 billion is down from $9.76 billion in the same period last year and below analyst estimates. Comparable sales are also down 2.9%, reflecting ongoing consumer spending pressures, particularly in high-margin categories like appliances and home theater.

The company's adjusted EPS of $1.26 is also below estimates by $0.04 but is slightly higher (by 4%) year-over-year. Domestic revenue is down 3.3% to $8.70 billion, with online sales comprising 31.4% of total domestic revenue, slightly improving from prior quarters. Gross profit margins are up by 23.6%, but higher SG&A costs offset these gains.

Best Buy’s latest full-year revenue guidance is $41.1-$41.5 billion, which is down from previous estimates and would imply a comparable sales decline of 2.5% to 3.5%. The company is maintaining its non-GAAP operating income rate guidance of 4.1%-4.2%, emphasizing effective cost management amidst top-line challenges.

Key growth areas include computing, tablets, and services, while traditional strengths like appliances face softness. The company is noting a shift in consumer behavior, with customers delaying purchases for sales events and focusing more on high-value technology essentials.

As Best Buy heads into the critical holiday shopping season, its Q4 guidance suggests continued pressure. Its stock is down 6.48% in premarket trade, reflecting investor concerns.

Retail

Burlington Lowers Q4 Outlook Amid Seasonal Challenges, Stock Tumbles

Pic Credit: Jay1095, CC BY-SA 4.0, via Wikimedia Commons

Burlington Stores Inc. shares are down 5.8% in premarket trading today due to its below-par fourth-quarter projection. For the third quarter ending November 2, Burlington’s net income of $90.6 million, or $1.40 per share, is notably higher from $48.6 million, or $0.75 per share, in the same period last year.

Adjusted earnings of $1.55 per share are also aligned with Wall Street’s consensus estimate. Revenue for the quarter is up 10.5% to $2.53 billion from $2.29 billion a year earlier, though it is slightly below analysts' projections of $2.55 billion.

However, Burlington’s forecasted adjusted earnings of $3.55 to $3.75 per share for the fourth quarter are below the $3.78 per share expected by analysts, which is causing the shares to fall.

The company attributed its cautious outlook to the impact of warm weather on sales of cold-weather apparel, particularly coats. Despite the challenges, Burlington is finding positive momentum in other product categories and remains focused on optimizing inventory levels to navigate the evolving retail landscape.

Sporting Goods

Strong Q3 Performance Sends Dick’s Sporting Goods Shares Up 5.5%

Pic Credit: Mike Mozart from Funny YouTube, USA, CC BY 2.0, via Wikimedia Commons

Dick’s Sporting Goods shares are surging 5.56%% in premarket trading today upon its better-than-expected third-quarter results and raised full-year guidance.

The retailer’s earnings per share (EPS) of $2.75 is above analyst expectations of $2.67. Revenue is at $3.06 billion, slightly ahead of the $3.03 billion consensus estimate. Comparable sales are up by 4.2%, exceeding the anticipated 2.5% growth, while gross margin is at 35.8%, compared to the forecasted 35.1%.

Lauren Hobart, President and CEO of the firm, cited a continued focus on its strategic pillars and execution for the success.

Looking ahead, Dick’s Sporting Goods also raised its guidance for fiscal year 2025. The company now expects EPS to range between $13.65 and $13.95, slightly above the consensus estimate of $13.88. Revenue is forecasted at $13.2 billion to $13.3 billion, with comparable sales growth revised upward to 3.6%-4.2%, higher than the previously projected 2.5%-3.5%.

This strong performance, coupled with the improved outlook, underscores the retailer’s successful strategy in navigating market challenges while capitalizing on consumer demand.

Technology

A groundbreaking company is reshaping the $1 trillion smartphone market, turning phones from a monthly expense into a source of income.

With 32,481% revenue growth from 2019 to 2022, it’s no surprise this company ranked as the #1 fastest-growing software business on Deloitte’s prestigious list.

Now, their pre-IPO offering is live at just $0.26/share, following a previous round that saw over 20,000 investors participate.

This is your chance to join before the window closes and even lock in 100% bonus shares.

This is a paid advertisement for Mode Mobile Regulation A offering. Please read the offering circular and related risks at invest.modemobile.com.

Movers and Shakers

Poseida Therapeutics [PSTX] - Last Close: $2.86

Poseida Therapeutics' stock has skyrocketed 222% in premarket trading.

Roche announced plans to acquire the company for up to $1.5 billion.

The Swiss pharmaceutical giant will pay $9 per share upfront (a huge premium over Poseida's previous closing price of $2.86), with additional performance-based payments potentially increasing the total to $1.5 billion.

Roche aims to bring Poseida's cutting-edge CAR-T cell therapies, used to treat certain cancers, in-house. These therapies are personalized by re-engineering a patient’s immune cells to fight cancer.

The acquisition also includes Poseida’s innovative manufacturing capabilities and technologies to scale "off-the-shelf" CAR-T therapies, which could broaden their commercial use.

My Take: Roche’s buyout is a validation of Poseida’s technology and future potential. Given the $9-per-share buyout price, it’s no wonder the stock has gone up so high. Keep an eye on this stock through the day.

ZenaTech, Inc. [ZENA] - Last Close: $6.42

Coming off a massive 336% surge in the last 5 days, ZENA is again growing by nearly 65% in premarket trade today.

Significant advancements in the military drone sector in recent days, ZENA’s compliance with critical defense standards, and its exemplary quarterly returns are together causing this rally.

The company recently announced partnerships with Blue UAS and National Defense Authorization Act (NDAA)-compliant supply chain partners, positioning its ZenaDrone 1000 AI drones for sales to U.S. Defense branches and NATO forces.

These drones have already been successfully tested by the U.S. Air Force and Naval Research for field-critical tasks like transporting cargo.

ZenaTech’s compliance with strict cybersecurity and sourcing requirements under NDAA and its pursuit of Blue UAS certification make it a key contender in defense contracts.

Additionally, the company reported a 15% revenue increase for the first nine months of 2024, reflecting strong business growth. These developments have generated investor confidence, boosting the stock’s appeal.

My Take: ZENA is clearly a stock to watch out for in the future, given its massive growth potential.

Semtech Corporation [SMTC] - Last Close: $53.44

Semtech (SMTC) shares are up 19% in premarket trading due to its strong Q3 2024 financial results, which exceeded analyst expectations.

The company’s earnings of $0.26 per share are beyond the consensus estimate of $0.24 and significantly higher than the $0.02 per share it earned a year ago.

Revenue is at $236.8 million, a 1.81% beat over expectations and a 17.9% increase from the $200.9 million reported last year.

My Take: The company has consistently outperformed revenue estimates over the past four quarters and has risen 146.95% YTD. This is definitely a stock to keep on your radar.

Billion Dollar Industry

Goldman Sachs projects the global music market will surpass $160 billion by 2030, but a deeper transformation is already underway.

The next major economic wave in music will be driven by direct-to-consumer engagement and monetization, redefining how artists connect with their fans.

Much like Amazon and Shopify revolutionized eCommerce by cutting out traditional retailers, a new platform is empowering artists to bypass middlemen like streaming services, social media platforms, and ticketing agencies.

This innovative infrastructure enables artists to fully monetize their audience, strengthen relationships with top fans, and build a loyal base of superfans—proven to spend up to 80% more than the average listener.

With 15 granted patents and cutting-edge technology, this company is poised to lead the way in powering this direct-to-fan revolution. For investors, this represents a rare opportunity to join an industry poised for massive growth and transformation.

Everything Else

That’s all for today. Thank you for reading. If you have any feedback, please reply to this email.

Best Regards,

— Adam Garcia
Elite Trade Club

Click here to get our daily newsletter straight to your cell for free.

P.S. Just like this newsletter, it's 100% free*, and you can stop at any time by replying STOP.