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More on Today’s Markets:
Snowflake (NYSE:SNOW) beat consensus estimates for its revenues and earnings on Wednesday, which relates back to strong customer retention and success in growing its enterprise customer base. Snowflake’s shares immediately surged more than 13% after the SaaS enterprise submitted its earnings scorecard for Q1’26 and guided for strong top line growth in the current fiscal year. Snowflake continued to grow its customers at a rapid clip, especially in the segment of enterprise customers that are spending at least $1.0M annually on the Snowflake platform.
We are long shares of Seagate Technology Holdings plc (NASDAQ:STX), a leading supplier of hard disk drives (HDDs). HDDs hold almost 90% of the data residing in large-scale data centers, and as a result, over 80% of Seagate’s revenue is derived from high-capacity, high-performance drives sold into the major hyperscalers (Amazon, Google, Meta, and Microsoft) and enterprise server and storage OEMs. The prospects for massive, sustained data growth are undeniable, and the incremental storage demand driven by the AI wave has barely begun. Already benefitting from these secular tailwinds and its position in a dominant duopoly, Seagate is executing a generational technology transition to heat-assisted magnetic recording (HAMR) that promises to supercharge density gains and company profitability.
Oklo has performed very well since Trump took office, rising 130% this year. However, it did rise and fall between $50 and $20, now back to $50. This immense volatility has occurred over less than six months, making the stock speculative despite its relatively high $6.8B valuation. In my experience, such volatility is usually seen in companies with market capitalizations under $500M. Although it has had immense positive momentum recently, the stock still faces a higher short interest of 10%.
Against this unfortunate backdrop, shares of Zillow (Z) have dropped ~10% this year, underperforming the broader S&P 500; and is also down ~30% from year to date peaks near $85. The key question for investors now is: is the lull in Zillow temporary, or are there structural problems at hand here that will take longer to fix?
That’s an incredibly negative backdrop for Compass (NYSE:COMP), now one of the largest brokerages in the U.S. through its many recent acquisitions – and yet even though its industry continues to shrink, Compass is growing – both organically and through M&A. Still, investors have soured on this name, especially after a miss on revenue growth in the company’s recently released Q1 earnings. To me, this creates a fantastic buying opportunity in this stock.
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