story stocks and week/year ending trivia ?3

16:57 15-Dec-22

More corporate trivia to top off the week:

Polestar will be showing off a driver monitoring system for the Polestar 3 at CES.  I doubt that the system uses Himax WiseEye products, but it does seem like a valid use case and battery extending improvement.  As for Polestar, more exposure is always good, but not necessarily a good use of funds while the company is unable to offer a competitive value proposition to new owners.

Shell has also followed up with a press release on its joint development of the 760MW "Ecowende" wind farm 53km off the Dutch coast.  The size of the project isn't small, yet it will account for only 3% of the country's electric use, showing how much work is still to be done in renewable development.

That leads me to PPL Corp's application to replace 1500MW of coal generation in Kentucky with two new 621MW natural gas power plants, 240MW of solar, and 125MW of battery storage.  PPL is seeking approval from the state regulator by October 1st.  This was expected, but the 20-year+ life of natural gas plants and 2028 project target underscores the same point, and the ramp ahead for New Fortress.

I opened this week writing:

I expect Powell may try to talk a little tougher on Wednesday, though, but for the market to rightly ignore any chance at either a government shutdown or a real budget.  That in turn means more badly informed market action as we head into year end.  It may not look like it now, but I hold out hope that next week is when the market deals really start to show.

Well, Congress looks set to kick the can for another week, but with monthly options expirations tomorrow, we didn't quite have to wait until then for misinformed values.

Chief among them is NFE.  I've seen headlines from mainstream financial sites that should know better variously and incorrectly characterizing last night's share sale as being from New Fortress itself, or currently on offer to the public for $46.  If NFE closes below $45 tomorrow my positions will be larger and I will be happy about that, especially since I don't see any open interest on the put side that would create a lasting hangover.  Instead it looks to me like call buyers, who are typically small-time retail investors, are getting fleeced once again.

VIRT comes in a close second, but it doesn't have the near-term catalyst that NFE does.  The same goes for AMSC without further OMIBs, whereas CES is a questionable catalyst for HIMX.  I also think the medium term catalysts for LUMN are still valid, but with tax loss selling and executive spot retention bonuses for working under the new CEO, I still see plenty of opportunity for lower stock pricing in the last two weeks of the year.  There may be a few completely new value calls as well, but that will depend on how year-end pricing develops.

In the meantime, I'll wrap up with some trivial corporate news...

eMagin announced a $1.7M military order without specifying the fulfillment timeline.

Vodafone completed the conversion of its Egyptian business into an equity stake in Vodacom.  It should have the private equity buyout of Vantage finalized shortly after January 10th.

Shell is also slimming down by shedding more hydrocarbon production.

The market mood today is not being helped by retail sales, which came in below expectations for both America and China.  PCE a week from tomorrow is the next economic figure that really matters, though.  I will mostly use the following week for end of year website changes as well as planning new longer term features.  Then we can finally start looking forward to moving back toward stock picking in a more normal market environment.