Watch List Weekly –Talking Centrus, Hims, Erie, GFL
Plus a quick travelogue and a reminder of what to expect in coming weeks.
(This friendly reminder: My Red Flag Alerts and selected On the Street content are no longer free. But while the paint is still drying on my paywall, my introductory price remains. I will be raising prices. Here’s more on who I am, why I’m charging and what you can expect from On the Street and from my Red Flag Alerts.)
Keeping it brief…
First, greetings from parts unknown.
Second, Centrus rockets higher.
Third, beware of the bravado at Hims.
Fourth, Erie – how low will it go?
Fifth, more drama/dysfunction for GFL.
And now, on with the show…
Weekly Scattershot
1. Greetings From Parts Unknown
Okay, not exactly parts unknown. The above was a weekday a few days ago in Madrid. And this is barely the tail-end of the shoulder season – maybe the end. Summer apparently is even more crowded.
This reminder: While I’m traveling over the next few weeks, my dispatches are likely to be sparse, if at all… including the Watch List Weekly. In the interim, I’ll be running a few freebies and re-runs.
2. Centrus Rockets Even Higher
Centrus Energy LEU 0.00%↑ continues its journey skyward after announcing earnings last week – and in the process creating a total disconnect from the prior week’s sizzling hot nuclear brethren: NuScale SMR 0.00%↑ Nano Energy NNE 0.00%↑ and Oklo OKLO 0.00%↑ – all down double-digits. Even the Van Eck Uranium and Nuclear ETF NLR 0.00%↑, not pictured in the chart below, is down 2.5% over the past week versus Centrus, which rose roughly 17%.
Not that there was anything outrageously noteworthy in the Centrus earnings report to warrant such a surge…
Possible Reasons
Maybe it was CEO Amir Vexler’s appearance during a 60 Minutes segment a week ago, which focused on how Russia gets around sanctions for selling things to the U.S. That includes uranium, for which Centrus is the main “broker.”…
Or maybe it was his comments about how Centrus plans to build a bunch more centrifuges so the U.S. won’t be as dependent on Russia…
Or maybe it was that everybody overlooked the fact that he also said building those centrifuges will take another six or seven years.
Or maybe it’s something as simple as classic irrational extrapolation about something so far in the future that it gives investors a “story” to believe in.
What’s clear is that Centrus isn’t a quarterly story for bulls or bears. It’s a story that will take years to play out in a market that isn’t without competition.
The Ole’ Diversion Tactic
Oh, wait – that’s right, silly me: On its earnings call, Centrus made a point of saying that its competition in the U.S. is foreign-owned, albeit by U.S. allies… but that “we are the only company with an American technology and an American workforce using an American supply chain that enriches uranium today.”
Never mind that those other companies are employing American workers. Diversion tactic aside, that misses the bigger point… that Centrus is far behind that competition, which has far more cash and is much further along in building enrichment capabilities in the U.S.
And If You Missed It…
In my “Atomic Frenzy” report last week I explained why the stock – even before this latest spike – is likely vulnerable. Doesn’t mean it won’t go higher; it very well might until investors move on to the next hot thang.
3. Beware of the Bravado
When Hims & Hers HIMS 0.00%↑ reports earnings tomorrow – if it’s a meet or beat, which it very well could be thanks to the GLP-1 weight-loss surge – beware of the bravado.
With Hims, it’s already so loud that I had to yank out my trusty Hostile React-O-Meter™ to confirm what I was seeing.
If you’re new to On the Street, while dating back to the dot-com era, the Hostile React-O-Meter™ is still a fairly reliable indicator of excess euphoria and hubris. With Hims, the Hostile React-O-Meter™ is already spinning out of control, I tell ya – OUTTA CONTROL!
Examples include: