I’m So High Right Now

-Seth Rogan and $SYTA -probably

Shares of Siyata Mobile had a better Tuesday than you did. The company’s stock rocketed higher on news that it received a $1.3M purchase order for first responder customers and police in Europe, the Middle East, and Africa. The purchase order was for Siyata’s recently released SD7 ruggedized devices, VK7 vehicle units, and other accessories. While not an overly large order monetarily compared to the numbers being thrown about on Wall Street, investors clearly liked the early adoption of the company’s products. The stock finished yesterday’s trading session up an incredible +66.7%.

• Siyata is a global vendor of Push-to-Talk over Cellular (PoC) devices and cellular signal booster systems.
• The company’s products allow first responders and enterprise workers to instantly communicate over a nationwide cellular network of choice, to improve communication, increase situational awareness, and save lives.
• The SD7 and VK7 are seen as upgrades to the current Land Mobile Radios that often suffer from network incompatibility, limited coverage areas, and restricted functionality.

Siyata’s stock price was down 82% from its February high of $15.75 as of Monday’s closing price of $2.76. The stock’s most recent swing high of $9.68 put in on October 27th is my next upside target for $SYTA. I’m keeping $SYTA on my watchlist for evidence of continued momentum to the upside.

I Like to Moovit Moovit

Puns are underutilized in corporate America!

It’s a bittersweet moment when the baby birds grow up and fly away, as Intel (INTC) is about to find out. The chipmaker is spinning off the autonomous driving technology unit Mobileye via IPO, but won’t be total empty nesters since it’s still retaining a significant stake. Much like my parents still paying my cell phone bill after college.

• Intel acquired the Israeli company back in 2017 for $15B.
• Mobileye specializes in chip-based driver assist and autonomous driving technology products under the EyeQ name, as well as operates the mobile trip planning app Moovit. Hopefully, all future product offerings will also be pun-based.
• The Mobileye unit recently shipped the 100 millionth EyeQ system as well as deployed a robotic taxi into service in Tel Aviv and Munich. Driverless taxis may still seem a bit unnerving, but the experience probably beats an overly chatty Uber driver.
• Through Q3 2021, Mobileye has produced $361M in operating income on $1B of sales which are already up over full-year 2020 results of $241M in operating income from $967M in sales.

The market reacted favorably to the news, with INTC up 3.1% on Tuesday. Intel will remain the majority owner of Mobileye and will continue to consolidate results into reporting… So basically instead of moving completely out of the house, Mobileye is just fixing up the parents’ basement into a cool bachelor den.

Brace for Impact – Evergrande

Misses $82.5M Interest Payment

Pictured: Evergrande Heading to Davy Jones Locker.

The saga of Evergrande continues its descent as the Chinese developer announced yesterday that it was forming a risk management committee of state officials in an effort to, well, mitigate future risks. The group is pretty much bending the knee after missing the grace period on a $82.5M interest payment, originally issued for Nov 6 by Scenery Journey Ltd, and will either go through a massive debt restructuring or become China’s largest company default.

• There was no doubt that the sinking of Evergrande would create a big splash but it appears the trend is rippling throughout the Chinese real estate market. Fellow developer Kaisa Group Holdings announced on Friday it “might” fail to pay off a $400M bond due this week, and its shares were suspended for trading yesterday.
• The Death spiral of these real estate developers is likely due in part to a concentrated effort by the Chinese government to change its attitude regarding corporate default. Victims of this shift towards a no-bailout philosophy include chipmaker Tsinghua Unigroup which experienced default in December 2020. Evergrande is big though, a lot bigger…

You already knew this but for starters: it seems that Chinese real estate development is quite the toxic investment and you should stay away… just like my ex. What this saga does inform us is the prevailing attitude of China’s government in the face of the private sector. Clearly Xi and friends don’t want to admit any kind of business is “too big to fail” and wants to punish developers like Evergrande and Kaisa for leaning into debt-fueled growth. If this stance persists, today’s actions may indicate which businesses will draw the ire of the world’s second-largest economy.

Micro Ethereum futures are coming according to the CME Group (CME). The new product will be equivalent to 1/10th of an ETH token, which is currently trading around $4,300 (at least it was when this was written, these cryptos bounce around more than a chihuahua with ADHD). Full sized ETH futures were launched back in February, but the fun sized ones should allow traders to play the space with lower margins.

• Micro Bitcoin futures were launched earlier this year so now customers have access to multiple ways of trading the two largest cryptocurrencies.
• The new product will be cash-settled and price based on a once a day Ether/Dollar reference rate.

As more new crypto-based products continue to launch, both individual and institutional investors have opportunities for greater exposure to those markets. The demand for digital assets continues to grow rapidly, and the metaverse that we will find ourselves pulled into (some of us more reluctantly than others) will expand their use cases. Savvy traders need to have a basic understanding of crypto and micro futures could be the red pill for many. Or is it the blue pill?

Trupanion’s reason for partnering with Chewy…probably

Shares of Trupanion (TRUP), a leader in medical insurance for pets, rallied after it was announced they would be partnering with leading online destination for pet parents and partners, Chewy (CHWY). Trupanion’s stock finished Tuesday’s trading session up a whopping 39%, while $CHWY finished the day up 2.06%. The deal will allow Chewy’s more than 20M customers access to specifically designed pet health insurance and wellness plans on their site starting in Spring 2022.

• The partnership will allow Chewy to “offer customers both preventative care wellness plans and comprehensive insurance plans for accidents, illnesses, and chronic conditions.” Sounds like a better plan than the one I’m on tbh.
• Trupanion, founded in 2000, currently provides medical insurance for roughly 600k cats and dogs throughout the U.S., Canada, and Australia. Guess I’m paying out of pocket for my pet fish Mikey.
• Chewy will also be able to “leverage Trupanion’s patented software to pay veterinarians directly, thus reducing out-of-pocket expenses and increasing access to care, officials said.”

Earlier this year we saw $TRUP trade in a range between $110-$125. The stock spiked above the upper range to $140 before retracing all the way back down to the $110 level. Guess what happened next? Yep, news came out on the deal and $TRUP is off to the races. I am keeping $TRUP on my watchlist and waiting to see if we get a pullback to the $125 area before thinking about going long.

Other News Link Roundup

• Elon’s fireside chat – Musk discusses infrastructure and innovation at CEO Summit 
• Omicron is OUTTA here – US indices jump as fears about variant subside 
• Who unplugged the server? – AWS outage creates problems for everyone 
• Can’t beat black gold – Traders bet on us oil export ban 
• Cruising altitude – Airbus delivered 58 planes in November 
• Flying Solo – American Airlines CEO to step down