Ticker Reports for October 20th
Survey Reveals: America's Most Coveted Businesses in 2024
We recently asked 3,000 people across the country about their ultimate business dreams. Here’s a look at the most coveted ventures that capture the imaginations of locals from coast to coast.
Key Findings:
Cultural Connection
Many business dreams reflect a deep connection to each state’s unique culture and heritage, like the jazz bars in Louisiana and the honky-tonk bars in Tennessee.
These ventures are about celebrating the local music and flavors that define each area, offering a space for both locals and tourists to experience authentic aspects of the state.
Nature & Adventure
States with iconic natural landscapes, such as Arizona’s Grand Canyon and Colorado’s Aspen, show a strong desire to build eco-friendly and adventure-focused businesses.
Whether it’s a luxury ski chalet or an eco-tourism company, these business ideas emphasize sustainable interactions with nature, allowing visitors to explore while preserving these beautiful environments.
Historical & Intellectual Hubs
In places like Massachusetts and Indiana, residents are drawn to historically rich business ideas like independent bookstores and bed and breakfasts.
These ventures appeal to a love for literature, history, and classic experiences, creating spaces where people can slow down, appreciate the past, and engage in thought-provoking conversations.
Small Town Charm
Many states, such as Iowa with its independent bookstore dreams and Maine’s desire for a Kennebunkport art gallery, reflect a trend toward creating small, community-focused businesses.
These ventures offer gathering spaces that feel personal and local, allowing owners to build relationships with customers and create cozy, inviting environments.
Food & Hospitality
The desire to own seafood shacks, crab houses, and coffee shops across the U.S. highlights a strong emphasis on creating authentic dining experiences that reflect each state’s culinary culture.
From a Gulf Coast seafood restaurant in Alabama to a Portland eco-friendly coffee shop, these ventures focus on local ingredients, sustainability, and capturing the spirit of the region through food.
Wellness & Relaxation
Spas, resorts, and wellness lodges are popular choices in states like Arkansas, Vermont, and West Virginia, showing an increasing demand for businesses that offer an escape from the everyday.
These ventures often emphasize natural beauty and relaxation, tapping into each area’s scenery to provide a calming retreat for both locals and visitors.
Outdoor Recreation
States with adventurous landscapes, like Montana’s fly-fishing dream and Nevada’s Lake Tahoe ski lodge, reflect a strong interest in businesses that embrace the great outdoors.
These ventures allow locals to share their love for outdoor activities, offering guided adventures that bring visitors closer to nature while exploring the region’s best features.
Regional Pride & Tradition
Many dream businesses are centered on products or industries that are iconic to the region, like Kentucky’s horse farms and Georgia’s peach orchards.
These ventures are about more than just a business—they’re an expression of state pride and a way for owners to showcase traditional crafts and local specialties.
Eco-Conscious & Sustainable Ventures
With several states expressing interest in eco-friendly resorts, coffee shops, and adventure lodges, there’s a clear trend toward sustainability in business.
These ventures reflect a shift in priorities as residents seek to build businesses that align with environmental values, from Hawaii’s eco-adventure lodges to Washington’s eco-friendly resorts on the San Juan Island.
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Top 3 Stocks to Play Oil's Potential Comeback Rally
Oil prices are on the lower end of the curve in today’s cycle. Still, plenty of tailwinds are set up to potentially bring a new rally for the commodity. Demand has been lackluster lately, and supply isn’t moving the way markets want it to move in order to bring a new rally or oil. But there’s a reason why America’s favorite investor has been buying heavily into oil lately.
Over the next quarter or two, the new business cycle could help investors looking into the energy sector make a profit. However, there are many ways to capitalize on the potential rally in oil, and investors could get lost in the selection process without knowing what their options are today. This is why today’s list is more important than ever to consider.
Considering names like the United States Oil Fund LP (NYSEARCA: USO) to gain exposure to a fund that holds and trades oil futures in order to track the price of oil itself. Then, one of the market’s favorite players at the top of the value chain is Transocean Ltd. (NYSE: RIG). Finally, while not an energy name, FedEx Co. (NYSE: FDX) could become attractive when and if transportation costs rise due to higher oil, and people need more efficient transport services.
Why the US Oil Fund Is a Smart Bet: Rising Oil Prices Could Boost Returns for Investors
The oil futures curve is complex to get right, which is why this fund has a team of traders and managers to make sure that the fund’s oil futures holdings closely reflect the price of oil futures daily, plus or minus a certain percentage due to the contract date mix and management costs.
Realizing that oil prices could rise in the coming months, a few—although smaller—institutional players decided to buy some exposure to the oil fund as recently as October 2024. Leading the buying spree were those at CWM LLC, boosting their holdings by 134.2% and netting their investment to $179,000 today.
Then there is the Creative Planning fund, which added 7.7% to its oil fund positions, bringing its total holding to $942,000 today to show investors there is still some interest in the commodity today. For this reason, some people think oil could be headed higher in the coming months.
Sentiment started to shift when mega investor Warren Buffett decided to buy up to 29% of Occidental Petroleum Co. (NYSE: OXY) over the past few quarters, which got the rest of the market thinking. Then, a major event took place: the Federal Reserve (the Fed) cut interest rates at the most aggressive pace in 16 years, which turned the market.
Lower interest rates will bring more business activity, which will result in more oil demand. However, not all business activity is created equal. Investors need to see the manufacturing sector pick up specifically, which has been contracting for 23 consecutive months, according to the manufacturing PMI index.
Once that happens, investors could see oil prices start to get back on track. Here’s another reason: Chinese stimulus could bring the nation back in the game (it represented 40% of oil demand before COVID-19). Judging by the rallies in Chinese stocks recently, that catalyst might be closer than most think.
Why Transocean Is the Market’s Top Energy Stock Today
It might not be obvious until investors decode the market's language. Comparing Transocean's stock to that of its peers in the rest of the energy sector is critical here, and it all has to do with its business model. As a rig equipment leasing company, it is the first to get paid when the bigger oil producers come to the table looking to produce more oil in the future.
The way to decode this sentiment is through relative valuations and, of course, Wall Street's take. Transocean stock trades at a forward price-to-earnings (P/E) ratio of 64.3x today, compared to the rest of the energy sector's average valuation of 11.5x today.
Markets typically pay a premium for stocks they expect to grow by the most in the future, something Wall Street analysts are already betting on. Earnings per share (EPS) projections are set for $0.14 for the next 12 months, a significant improvement from today's net loss of $0.15.
This is why analysts also have a consensus price target of $6.88 a share, which calls for a net upside of 63.3% from the current price.
Analysts Project Double-Digit Upside for FedEx Stock
After a recent earnings sell-off, FedEx shares could become attractive in the coming quarters if oil prices manage to move higher from where they are today. FedEx’s robust and developed transportation network could help distribute costs more effectively when and if fuel prices rise as a result of more expensive oil.
Knowing that this thesis could play out, analysts at J.P. Morgan Chase decided to reiterate their “Overweight” rating on FedEx stock as of September 2024, landing on a price target of $350 a share for the company. FedEx would have to rally by as much as 28% to prove these targets right from where it trades today.
More than that, some institutional investors came in recently to close the gap between the previous sell-off and the stock’s fair value. Those at Value Partners Investments boosted their positions by 0.3% in the past quarter, bringing their net investment to up to $39.6 million today.
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Analysts See Growth in CrowdStrike Stock Despite July Setback
In July of 2024, a defective software update by cybersecurity firm CrowdStrike Holdings Inc. (NASDAQ: CRWD) led to global technology outages across multiple industries. In response, CrowdStrike shares plummeted, losing nearly 44% of their value in about two weeks before reaching a low point in early August. Since then, CrowdStrike stock has experienced a fairly steady recovery, although it remains well below its pre-incident levels.
For the most part, CrowdStrike has been fairly quiet about the faulty update since the summer. However, a recent earnings report by Delta Air Lines Inc. (NYSE: DAL) has brought the incident back to the attention of investors everywhere. The airline incident heavily impacted the CrowdStrike industry, with many firms canceling flights for days. Delta was among the hardest hit, with about 7,000 flight cancelations during a week, and its earnings report reflects this—the company posted top- and bottom-line misses, including a $380-million shortfall in revenue due to the incident, and lowered its guidance going forward as a result.
Months after the software incident, investors have largely returned to optimism about CrowdStrike. Thirty-four Wall Street analysts have named the stock a Buy, while just seven currently have a rating of Hold or Sell. Analysts predict that the share price will continue to rise, though with an upside potential of 5.8%, the stock is not expected to reach its highs from before the incident. With so much speculation surrounding this company, it's worth a closer look at its fundamentals to determine if it's likely to maintain this upward trajectory or if perhaps another cybersecurity firm could capitalize on the moment.
Strong Performance in the Latest Quarter and Client Retention
Much of the renewed enthusiasm for CrowdStrike may be due to its impressive results for its second quarter of fiscal 2025, which ended less than two weeks after the incident. During this period, the company posted a 32% year-over-year increase in total revenue and income from operations compared with a loss the year before. Net income per share attributable to the company was 19 cents, compared to just three cents in the prior-year period. The company's Falcon platform continues to drive subscriptions.
CrowdStrike's cybersecurity products are closely integrated into the tech infrastructures of many of its clients—two-thirds of customers use at least five CrowdStrike modules simultaneously—making a switch to another provider cumbersome and costly. This may have contributed to the company's strong retention of customers even after the software update debacle. Indeed, the company has taken on new partnerships since July, including a major new collaboration with NVIDIA Corp. (NASDAQ: NVDA). Overall, as of September, the firm experienced a 98% gross spending retention rate after the incident.
Future Growth Possible
Even though it has been below its peak since the summer, CrowdStrike is still an expensive stock. It is trading at a massively high price-to-sales ratio of 21.5. However, the company has room to grow as it expands its AI-based offerings and gathers new clients. CrowdStrike executives have set a goal of $10 billion in annual recurring revenue by the end of its 2029 fiscal year. This is a lofty goal but one that the company seems on pace to achieve, particularly if it is able to continue to improve its margins.
Analysts are optimistic that the company will also achieve growth measures in the meantime. Based on analyst evaluations, the company's projected earnings growth is a healthy 54.7%.
A Dip Opportunity
Suppose CrowdStrike's future trajectory looks like this. In that case, it will likely seem in hindsight that the July software update incident was a minor blip for the company that provided investors with a rare moment to buy the dip.
While shares remain below their peak levels from earlier in the year, the dip remains—although it gets smaller and smaller as CRWD continues to recover lost ground.
On the other hand, investors may also consider this an opportunity to look to CrowdStrike's competitors like Palo Alto Networks Inc. (NASDAQ: PANW), which currently has a price-to-sales ratio of 15.2.
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