We're Adding to 3 Holdings as the Market Finds its Footing
We also see Walmart’s October quarter comp sales reaffirming a recent Portfolio move.
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| Symbol | Transaction Type | # Shares Traded | Recent Price $ | Shares Owned After Trade | % Portfolio |
|---|---|---|---|---|---|
AXON | Buy | 22 | $536 | 377 | 3.8% |
META | Buy | 6 | $601 | 337 | 3.8% |
NOW | Buy | 10 | $823 | 245 | 3.8% |
After you receive this alert and when the market opens, the Portfolio will make the following trades:
Buy 22 shares of Axon (AXON) at or near $536. Following the trade, the Portfolio will own 377 AXON shares, roughly 3.8% of the Portfolio.
Buy 6 shares of Meta Platforms (META) at or near $601. Following the trade, the Portfolio will own 337 META shares, roughly 3.8% of the Portfolio.
Buy 10 shares of ServiceNow (NOW) at or near $823. Following the trade, the Portfolio will own 245 NOW shares, roughly 3.8% of the Portfolio.
Earlier this week, we shared that both AXON and META shares, based on their respective RSI levels, were oversold. That condition was still in effect as the market continues to find its footing, first by rebounding following the S&P 500 hitting a 5% pullback earlier this week and now with Nvidia’s (NVDA) quarterly results and guidance helping lift the market further.
Shares of ServiceNow have also entered oversold territory, and that is leading us to pick up some additional shares. We continue to see the company benefitting from rising AI adoption and usage, especially given existing data silos and other constraints flagged by IBM.
While we will continue to monitor Meta’s spending levels, we continue to see the company benefitting from the accelerating shift to digital advertising, especially as it looks to monetize all of its platforms, not just Facebook and Instagram. At the same time, internal adoption of AI should help drive improved profitability over the long term as those advertising volumes rise. Helping reaffirm that line of thinking, new data from Photoshelter found that 95% of marketers lean on social platforms to drive marketing outcomes, with two-thirds saying it is the primary channel that delivers results for their organization.
Turning to Axon, developments with the Cincinnati Police Department underscore how the company is expanding its addressable market with new and existing customers. In 2024, the department spent $2.78 million with Axon, roughly 25% of the $11.37 million budget, and that has now expanded to $4.6 million, making it the department’s largest vendor. Per reports, the jump reflects the department adding new Axon products and services, including drones, new Tasers, virtual reality training headsets for those Tasers, new body cameras, as well as dash and in-car cameras “for many officers.” Where are those records stored? In the cloud on Axon servers. Through the end of 2033, the department is expected to spend nearly $41 million on those contracted services.
The culmination of that development with Axon’s higher-margin software and cloud business reaffirms the razor-blade nature of the company’s business model. And we certainly like the multi-year backlog, which also gives some context for the $11.4 billion in future bookings Axon exited the September quarter with. It’s that backlog, along with the expanding customer footprint, that supports revenue chugging higher in 2026 while the ongoing mix shift to software and services does the same for EPS growth.
As we make these trades, we will reset our panic points for AXON, META, and NOW shares to $500, $560 and $750, respectively. As the shares rebound, we’ll lift those levels accordingly.
Two Other Things
First, as the market rebounds, we will keep a close watch on those positions that are approaching 4.5% position sizes. Should we see them hit that level or move past it, more than likely, we will be inclined to invoke our portfolio discipline.
Second, on Wednesday we added to our shares of Costco (COST) , citing the company’s superior comp sales and prospects for that to continue. To that list of companies with slower August-September-October comp sales, we can now add Walmart (WMT) , which posted adjusted U.S. comp sales of 4.5%. We are also encouraged by Walmart lifting its sales guidance for the current fiscal year, and we see the same factors behind that doing the same for Costco.
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(Please note that we are looking to execute these trades at or near the share price mentioned above. Once the trade is completed, subscribers can see the trade's executed price here. Be sure to toggle the chart to sort by Purchase Date.)
At the time of publication, TheStreet Pro Portfolio was long AXON, META, NOW, NVDA and COST shares.
