Advisors in Focus- November 20, 2020

Happy Friday! People around the country are preparing for next week’s Thanksgiving celebrations. The Covid virus will curtail gatherings but turkey will continue to be served. Turkeys everywhere will be on high alert, trying to avoid the chopping block. Retail clients understand this risk aversion as this week’s chop fest has kept investors from sticking their own necks out. There is one area though that continues to gobble up the attention of your clients.

  • Trivia Question- When was the first electric vehicle created?

Electric Vehicles continue to dominate your retail client’s research patterns. Most market participants believe former Vice-President Joe Biden will be inaugurated on January 20 and implement climate change policies that have been a cornerstone of his energy plans. We saw Chinese EV player Nio, Inc (NIO #1 in total traffic this week) post its Q3 earnings earlier this week. The usual suspects (TSLA, SOLO, PLUG) were popular search destinations. This week, there was a lot of speculation around the potential for an increase in charging stations, leading to a surge in search patterns by your clients in that space. We wanted to take a quick look at a new entry on their radar.

TrackStarIQ Data

Here are some highlights from Retail searches this week –

TOP STOCKS – BY Retail (Total Traffic) This Past WeekTickerTOP STOCKS- BY RETAIL (Surge* Traffic) This Past WeekTickerTOP ETFs By RETAIL (Total Traffic) This Past Week
Nio IncNIOBioRestorative Therapies, Inc.BRTXSPDR S&P 500 ETF
Tesla IncTSLAQuanta, Inc.QNTAInvesco QQQ
Fuelcell Energy IncFCELX FinancialXYFConsumer Discretionary Select Sector SPDR Fund
Alibaba Group HoldingBABAVilacto Bio Inc.VIBIProShares Ultra VIX Short-Term Futures
Eversource EnergyESLegacy Acquisition CorpLGCARK Innovation ETF
Boeing CompanyBA Forum Merger III Corporation Cl AFIIIiShares Russell 2000 ETF
Apple IncAPPLCiig Merger Corp Cl ACIICEnergy Select Sector SPDR Fund
Pfizer IncPFEChina Hgs Real EstHGSHVanEck Vectors Gold Miners ETF
Nvidia CorpNVDAVaalco Energy IncEGYSPDR Gold Trust
Moderna IncMRNAHudson Capital IncHUSNiShares Silver Trust
Naked Brand Group IncNAKDPhoenix New Media LtdFENGProShares UltraPro QQQ
Visa IncVSonos IncSONOTechnology Select Sector SPDR Fund IncAMZNBlue Hat Interactive Entertainment TechBHATProShares UltraPro Short QQQ
Electrameccanica Vehs CorpSOLOBellus Health IncBLUSPDR Dow Jones Industrial Average ETF
iBio IncIBIONaked Brand Group IncNAKDiPath Series B S&P 500 VIX Short-Term Futures ETN
Zoom Video Communications Cl AZMFTS International IncFTSIU.S. Global Jets ETF
Workhorse GrpWDAYMicro Focus Intl PlcMFGPFinancial Select Sector SPDR Fund
Plug Power IncPLUGSocket MobileSCKTDirexion Daily Small Cap Bull 3X Shares
Sorrento TherptSRNEEbang International Holdings Inc Cl AEBONiShares 20+ Year Treasury Bond ETF
Sundial Growers IncSNDLPdvwirelessATEXInvesco Solar ETF

*- Surge data is based on the average traffic from the past two days compared to the average traffic from the previous market week.

FuelCell (FCEL) is a new name to the list. The company designs and manufacturers service stationary fuel cell power plants for distributed power generation. The EV play was able to break above key resistance levels in the $3.00-3.20 area and rally 100% to $5.60. The move led J.P. Morgan to downgrade the stock to Neutral on its valuation. The Tier 1 shop had no issues with the fundamentals, and expects the company to establish profitability in 2022. However, the recent rally had led to valuation concerns which is notable since J.P. Morgan only initiated FCEL with an overweight on October 8.

FCEL has a market cap of $1.42 bln and is trading at a Price to Sales of 22x and a Price to Book at 12x. Both are lofty valuations but, we have seen similar valuations in the cloud computing space which suggests investors could be comfortable with this run. FCEL does have its doubters as there is currently a 20% short interest in the name (approx. $284 mln betting against this rally). With investors looking for ‘The Next Big Thing’ in the EV space, it is probably worth while asking clients about their interest in this play.

A few other names of interest on the list include:

  • Electrameccanica Vehicle Corp (SOLO)- SOLO was  #14 on the Total Traffic list. The Canadian EV player is another name that saw its stock double. The company’s Market Cap sits at $570 mln and it trades at a huge 959x Price to Sales. This has a 59 mln float and a 10% short interest.
  • CIIG Merger (CIIC)- CIIC was #7 on the Surge Traffic list. This is the latest SPAC vehicle that is looking to get into the EV space through an acquisition of Arrival Ltd. Arrival is a British company that makes electric vans and buses. Investors in the name include BlackRock, Hyundai, Kia, and UPS. UPS has ordered 10,000 vehicles.
  • Sonos (SONO)- SONO was #12 on the Surge list. The company reported a blow out quarter on Wednesday. The audio speaker play handily beat top and bottom line expectations which led to a breakout above the $17 level.
  • Bluehat (BHAT)- BHAT was #13 on the Surge List. The spike in the stock on Wednesday was due to it announcing a partnership with China Mobile Communications. The Chinese-based company develops augmented reality (AR) interactive entertainment games, toys, and education materials. For those looking for Christmas gift ideas, this is a name that could be worth a closer look.

Trivia Answer- Would you believe 1828?!?!?! This comes from the Energy.Gov site. There is a dispute on if the creator was Thomas Davenport or Robert Anderson. EVs would hold all vehicle land speed records until about 1900.

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