Spend money on Morgan Stanley over Robinhood Markets

IonQ: “That’s the problem. Everyone wants quantum computers. I was looking for quantum computers with Nvidia. We own Honeywell for … the nonprofit foundation. Here’s the problem: There’s no game on quantum computers right now. None, including that There is no game. There is only hype. We don’t want hype. ”

Robinhood Markets: “Look, I can comment on the last 10 points the same way. It’s so depressed, how can you not try? But the answer is, we don’t shoot things. We’re looking for fundamental reasons to own something. My nonprofit foundation owned by Morgan Stanley. Bet with them, not Robinhood, because it’s not a bet. It’s an investment. “

McAfee: “I don’t like McAfee. You have to be there NortonLifeLock. You are a member of the club. They know that when this deal is closed, NortonLifeLock will go straight to $ 30. Straight shot. ”

Western Union: “This stock is so damn cheap I have to believe it [CEO Hikmet Ersek] do something. I have to, have to, have to. I wouldn’t sell that stock for $ 18. ”

Royal Dutch Shell: “Royal Dutch is the fraction of the mental firepower that Mike Wirth brings to Chevron. We bought Chevron for … the charitable foundation. Why? Much better, much more disciplined than Shell. Much better capital allocation, and still good yield. That is the one to buy. ”

Doximacy: “Doximity is a damn good company. I don’t know how we’re going to change the address. It’s so good. … This is a great company with great advertising. I saw it was recently downgraded to by a great company I think Doximity has a lot of good reasons, but it’s trapped in this whole Multiple contraction of the price / sales ratio that nothing works. Don’t know what else to say. ”

Marathon Digital Holdings: “It’s a proxy. It’s just a proxy for this stuff. You want crypto, you buy crypto. … You like crypto, you own crypto.”

Join Now for the CNBC Investing Club to follow Jim Cramer’s every move in the market. Disclosure: Cramer’s nonprofit trust owns stocks of Morgan Stanley, NortonLifeLock, Honeywell, Nvidia, and Chevron.

2 Well-liked Robinhood Shares I Would not Purchase With Free Cash

Robinhood Markets is the company behind the Robinhood investment platform. Robinhood is particularly popular with the younger generation and has received praise for its efforts to “democratize finance”. Thanks to his app, many who had never invested in stocks before are now actively doing so. When you consider that the stock market is still one of the best wealth generators for the common man, that’s not a bad thing.

That said, Robinhood investors aren’t perfect, and while the list of the company’s 100 most popular stocks on the platform has some excellent selections, others aren’t that great. Here are two popular Robinhood stocks that I wouldn’t buy with free money: Okcugen (NASDAQ: OCGN) and Inovio Pharmaceuticals (NASDAQ: INO).

1. Ocugen

Ocugen – a clinical stage biotech company that currently has no commercialized products – is playing in the coronavirus vaccine market. It’s not necessarily a losing strategy, especially for a company this size; The current market capitalization is only $ 1.45 billion. There is still some blank space in the COVID-19 vaccine market, particularly in developing countries and with the advent of newer varieties of the disease.

Image source: Getty Images.

If Ocugen receives the Emergency Use Authorization (EUA) from the US Food and Drug Administration for his candidate and even generates $ 1 billion in sales, it would be a big win for the company. However, there are a few important points to keep in mind. First, the company signed an agreement to jointly develop and commercialize its candidate Covaxin with India-based Bharat Biotech. While Ocugen will hold the commercial rights to the vaccine in the US and Canada (pending approval), it will retain only 45% of Covaxin’s profits in those countries.

Second, the prospects of an early EUA in the US for Covaxin are as good as gone. As recommended by the FDA, Ocugen is now likely to file a biologics application that will take several months longer to review than an EUA. Third, Covaxin’s ability to gain market share in this competitive environment is dubious. In a Phase 3 clinical study conducted in India with 25,798 participants, the vaccine candidate was found to be 77.8% effective against COVID-19. Its effectiveness against the rapidly spreading delta variant was 65.2%.

In the meantime they are from. developed vaccines Pfizer, Modern, and Novavax have all shown an overall effectiveness of 90% or greater. Could Covaxin’s overall effectiveness be at least partially less because the late-stage study was conducted in India, where the Delta variant originated? Maybe, but other vaccines including that of. displaced Johnson & Johnson, have also shown potency against this variant. Put all of this together and add the usual risks Biotech companies (including potential unforeseen clinical and regulatory setbacks), Ocugen seems far too risky to invest in right now.

2. Inovio Pharmaceuticals

Inovio Pharmaceuticals also hopes to enter the COVID-19 market with its candidate INO-4800. However, the biotech’s prospects are even worse than Ocugen’s. Inovio faces at least two major challenges. First, the company is unable to conduct a Phase 3 clinical trial in the US because regulators have raised concerns about the proprietary device it uses to deliver its Cellectra 2000 vaccine.

Second, the US government withdrew funding for the Phase 3 portion of its Phase 2/3 study for INO-4800. As a clinical-stage biotech, Inovio is not generating product sales, and while it received grants last year to support its coronavirus-related efforts, the company will have a hard time getting additional ones with several vaccines that are now widely available Gaining third-party funding. Party grants.

So is the INO-4800 destined to stay in Inovio’s late-stage pipeline forever? Not necessarily. The company plans to conduct a phase 3 clinical trial in Asia and South America in collaboration with Advaccine Biopharmaceuticals Suzhou. The trial, due to start before the end of summer, will test the safety and effectiveness of two doses of the vaccine candidate given one month apart. In theory, Inovio could also make decent sales on INO-4800 given the advent of newer variants of the virus. However, until the phase 3 study is completed, it is impossible to predict how much the coronavirus vaccine market will still be able to gain.

Time isn’t on Inovio’s side, and betting that the company’s master plan comes true seems speculative. In short, it would be best to stay away from this company – at least for now.

This article represents the opinion of the author who may disagree with the “official” referral position of a premium advisory service from the Motley Fool. We are colorful! Questioning an investment thesis – even one of our own – helps us all think critically about investing and make decisions that will help us get smarter, happier, and richer.

Robinhood IPO: Deal raises much less cash than it hoped

The rapidly growing trading company couldn’t raise as much money as hoped. Robinhood’s IPO at a price of $ 38 per share, the lower end of the expected range. That suggests that demand for the controversial company may have been weaker than expected. The deal values ​​Robinhood at about $ 32 billion, making it more valuable than big companies like Nasdaq (NDAQ), Southwest Airlines (LUV) and Kroger (KR). That is well above the $ 12 billion price of Robinhood in its most recent private funding round.

And yet Robinhood failed to reach its target valuation of $ 35 billion.

The IPO brings in $ 2.1 billion and Robinhood is expected to trade on Thursday under the symbol “HOOD” on the Nasdaq.

The deal is still a major milestone for a company that revolutionized the way Americans invest and is growing explosively.

Robinhood reveals new regulatory probes on the eve of its blockbuster IPO

“The business was great fun. They have a great platform to build on, ”said David Weild, former vice chairman of Nasdaq and now CEO of investment bank Weild & Co.

Robinhood’s sales have increased 245% to $ 959 million last year as user growth and trading volume skyrocketed.

Robert Le, an analyst at PitchBook, said Robinhood seemed to be leaving some cash on the table to help its stock price rise on day one.

“Robinhood is playing it safe here,” Le said in an email. “A successful novel IPO has more than a few hundred million dollars in the company’s bank.”

“It seems to be rich”

But investors are paying a premium for that growth.

At the high end of Robinhood’s IPO palette, the deal would have valued the company at roughly 22 times trailing revenue, according to Renaissance Capital. That compares to multiples of just five for Charles Schwab (SCHW), a rival that is expanding more slowly. “It seems to be rich – unless the company can maintain that high growth,” said Kathleen Smith, a director at Renaissance Capital who manages the Renaissance IPO ETF (initial public offering). Robin Hood completely disturbed the online brokerage industry through the pioneer of commission-free trading. When Robinhood attracted new and existing investors to its platform, competitors were forced to cut trading fees and band together to survive.

Now Robinhood is disrupting the IPO process. The company allows its users to buy a portion – up to a third – of the IPO’s stock before they start trading on the Nasdaq. Usually only corporate insiders and powerful institutions get access to these coveted stocks.

New regulatory probes revealed

Robinhood’s public debut was delayed by a Series of controversies, the end record-breaking settlements too massive Failureswho have favourited questions about the business model, the management team, and the company’s ability to keep up with its explosive growth. Just this week Robinhood announced that regulators are investigating the fact that CEO Vlad Tenev is not with FINRA. licensed, Wall Street’s powerful self-regulatory agency. (Robinhood has argued that Tenev does not need to be licensed because he is the CEO of the parent company, not the broker-dealer). The Financial Industry Regulatory Authority and the Securities and Exchange Commission are also investigating whether Robinhood employees have shares in GameStop (GME), AMC (AMC) and other “meme” stocks ahead of the trading platform’s infamous trading restrictions in January. Robinhood settles lawsuit against 20-year-old trader who died of suicideLast month, FINRA beat the brokerage firm with its highest sentence to date, accusing the company of harming millions of customers and providing “false or misleading information” to investors. FINRA quotes in partial options trading proceedings in the center of a Recently settled family lawsuit a 20 year old Robinhood dealer who died of suicide last year.

Robinhood has neither admitted nor denied the FINRA charges.

Weild, the former Nasdaq executive, said Robinhood’s struggles may have only raised public awareness of the company – something that ironically helps. He compared the situation to the challenges America Online faced during its rapid expansion.

“All it did was increase their visibility and branding,” said Weild.

Other companies with legal problems have also been able to go public, including Airbnb and above (ABOUT).

“These are not free apps”

But Robinhood’s struggles have also shed bright light on the company’s controversial business model known as paying for the flow of orders. Like some other online brokers, Robinhood makes most of its revenue from selling its retail order flow to high-speed trading companies like Citadel Securities.

Robinhood argues that this tactic will benefit everyday investors as it paved the way for commission-free trading. But others say it’s really the high-speed trading firms that benefit – otherwise they wouldn’t be paying Robinhood for the flow of orders.

A surprising tech company could join the Dow nextNow the business model that Robinhood relies on is in question. The Securities and Exchange Commission verifies the payment for the order flow. SEC chairman Gary Gensler warned in May that there were “inherent” conflicts of interest with this business model and expressed concern about them playful nature of trading apps.

“These are not free apps. They are just free apps. The costs are within the scope of the order,” Gensler told the legislature.

If the SEC bans paying for the flow of orders, it would deal a blow to Robinhood.

“We believe paying for the flow of orders is a benefit for retail investors,” said Le. “But if the regulators don’t see it that way and forbid it, Robinhood will have to find new sources of income. That would be a great risk.”

Leveraged by the market boom

Robinhood not only faces competition from established online brokers, but also from Upstarts like Public.com and Invstr market the fact that they do not sell the retail order flow to high speed traders.

Smith, the manager of Renaissance Capital, said another risk was how closely Robinhood’s bottom line was tied to the fate of booming markets.

“What if we get a negative market? People could easily be put off if they lose money,” said Smith. “This company is so focused on the equity and crypto markets. A downturn would hurt Robinhood more than a Charles Schwab. ”

Robinhood says restrictions on GameStop resulting from tenfold improve in clearinghouse deposit necessities

The Robinhood application on a smartphone.

Bloomberg | Bloomberg | Getty Images

Online broker Robinhood announced that it has placed temporary purchase restrictions on a small number of stocks as the deposit requirements for stocks imposed by the Wall Street clearinghouse have increased tenfold.

The decision of Robinhood, a pioneer and app for free trade popular with retail investors, was scrutinized by its customers over the past week.

“It wasn’t because we wanted to stop people from buying these stocks,” said Robinhood said in a blog post published late Friday.

“We did this because the amount required to deposit into the clearing house was so large – with individual volatile securities adding up to hundreds of millions of dollars in deposit requirements – that we had to take steps to purchase them limit volatile stocks to ensure this could comfortably meet our requirements, “it continued.

Amateur Investors Using Robinhood and Other Apps Offer sharply abbreviated stocks and causes GameStop Shares rose 400% over the past week, causing significant losses for hedge funds, which sold the shares short.

Robinhood first announced to investors that they couldd only sell and not buy certain stocks of certain companies that caught the attention of retailers on Reddit. With the online broker, customers can now only buy a single GameStop share. All in all 50 stocks are now limited to the stock trading app.