Sticking to This Palantir Price Target Following Shield AI News
In this round of smaller-cap stocks, we provide outlooks for KeyCorp, Palantir and Vera Bradley.
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The large money-center banks got the earnings season off to a good start. So far, the regional banks have been a little spottier in their performance.
PNC Financial PNC beat on earnings and revenue, grew net interest margin and net interest income and still sold off hard on Thursday. That said, PNC is rebounding nicely this morning. U.S. Bancorp USB missed on earnings, beat on revenue and similarly struggled on Thursday. That stock was not rebounding on Friday morning. Then there's M&T Bank MTB. That one beat Wall Street's expectations decisively for both earnings and revenue but experienced a slight narrowing of net interest margin. That stock sold off on Thursday, and is making an attempt at rallying on Friday, but is kind of just hanging out where it was last night.
I have a name in inventory, a regional bank, which rounds out my banking holdings that also include Wells Fargo WFC and SoFi Technology SOFI. Both of those names are rocking this week.
This name is KeyCorp KEY, a Cleveland, Ohio headquartered bank that operates more than 970 branches in 15 states. KEY will report next Tuesday, January 1, as the markets come off of a three-day weekend and the nation opens for business under a new president.
For the fourth quarter, Key Bank, as we used to call it, is projected to have earned a GAAP $0.33 per share on revenue of $1.75 billion. That would be up from the year-ago comparison of $0.03 per share and good for revenue growth of nearly 14%. Oh, and KEY is not a small cap and does not trade under $10 per share. It is smallish though for a bank you've heard of and does trade for less than $20 per share. The stock appears to be setting up nicely going into the digits.
Readers will see that KEY has now hit resistance twice at its 50-day SMA since breaking out of a falling-wedge pattern (which is a pattern of bullish reversal). Relative strength, which is above the chart, is improving. Below the chart, within the daily MACD, the histogram of the nine-day EMA has moved above zero, which is short-term bullish. Additionally, the 12-day EMA has moved above the 26-day EMA. While they are both still below the zero bound, this does reinforce the upturn in trend.
KeyCorp (KEY)
Target Price: $23
Pivot: 50-day SMA (currently $18.30)
Add: Down to the 21-day EMA (currently $17.60)
Panic: Loss of the 200-day SMA (currently $16.20)
Not Yet
We discussed Vera Bradley VRA on Wednesday. That was the first day that the stock knocked on the 21-day EMA's door. Today is three days in a row. I need the stock to take down this line, so it can make a run higher on the backs of some swing action. My plan? I'm out of half of my stock at net basis ($4.10) and then I trade to make some lunch money with the rest.
Palantir Technologies (PLTR)
PLTR is up 12.6% since Monday. Rock on. If the stock can take down the 21-day EMA and get the histogram of the nine-day EMA (within the daily MACD) back into positive territory, that could take the 12-day EMA above the 26-day EMA and then, ladies and gentlemen, our ballgame may be back on.
Readers may have noticed on Friday morning that Palantir and Lockheed Martin LMT are among investors named in the Financial Times as being possibly involved in unmanned aircraft startup Shield AI. The Startup has been providing drones to the U.S. and Ukrainian government.
My target price for PLTR remains $90.
At the time of publication, Guilfoyle was long KEY, VRA, PLTR and LMT equity.
