GNC HOLDINGS CEO JUST BOUGHT $5,000,000 OF STOCK!

The CEO of beleaguered GNC HOLDINGS just bought $5,000,000 shares at prices between $8-8.50 on February 21. This stock has dropped from $35.90 last April to $8.50 as we write this. Keep in mind, just because insiders buy does not mean a stock goes higher…but something to watch.

PRE MARKET NOTES

Futures are down a wee bit off of yesterday’s weakness. Pullbacks are way overdue as we have not seen a 2% drawdown since before the election. Of course, does not mean we ever get one again…bazinga.

COSTCO whacked on numbers. Recently, they reported great comps. But the real numbers show weakness.

SNAPCHAT pulled back at the close. Just be careful and pick your poison. By any measure, its valuation is a joke.

CLOSING THOUGHTS

Well, that wasn’t so nice. Just a heavy day. Not so thrilled Transports move out and then tuck their head in like a frightened turtle. Not so thrilled that the small caps still under-perform. But market needs a rest. Markets need some pulling in. Markets need to wipe the smiles off the face of the bulls and put some doubt back in the system. Doubt breeds higher prices. Markets remain stretched, extended and overbought witha good does of bullishness

SNAPCHAT NOTES

SNAPCHAT NOTES (Hurry up as they will disappear!)

By Gary Kaltbaum- March 2, 2017
As we write this, give or take a few, the market is valuing Snapchat at nearly $30 billion. First off and to be clear, there is no way this company could come public at this valuation in a poor market environment. The company is taking advantage of a ripe market and rightfully so.
But valuation matters. Ok, let’s add one word to that sentence…valuation ULTIMATELY matters. In the short run and sometimes in the intermediate term, valuation can get crazy. We have seen it time and time again. But ultimately, reality does set in. Reality set in with Twitter, Gopro, Fitbit and other “glamour: type names in the recent past. The jury is still out on Snapchat.
The problem with buying the stock with a $30 billion valuation is we have a company that has over $500 million in losses and the sales number is less than the losses. On top of that, business has been slowing as stiff competition comes from the likes of Facebook and others. Sales have grown “bigly” over the past 4 quarters…$39 bil, $72 bil, $128 bil, $166 bil but losses continue double “bigly” and sales growth is waning.
We also heard today that Snapchat is fashioning themselves as a camera company. And we box professionally. There is a reason why the global warming people changed their moniker to climate change. It was for the marketing. Snapchat is now marketing themselves differently because they need the above–18 year olds to get involved. Time will tell. We are just not so sure of their ability to capture the masses.
We have no idea how the stock does in the short run. Anything is possible. Price goes as high as someone is willing to pay and sometimes glamour names can go farther and longer than anyone thinks. Just realize that unless this company starts to grow their numbers in a meaningful fashion and we mean both sales and earnings, eventually, gravity will take over. If this was a company that sold steel pipes, it would not have been able to come public in the double digits.

MCDONALDS NOT STANDING STILL!

If you don’t change, the market changes for you.

Source: http://www.foxbusiness.com/features/2017/03/01/mcdonalds-lays-out-plan-it-hopes-can-reverse-drop-in-visits.html

SNAPCHAT DAY

SNAPCHAT going public today. If this was a company selling steel pipes, it would come out at 75% below the IPO value…seriously. 50x sales…not earnings…but 50x sales….massive losses and a recent slowdown in business does not thrill…but glamour is glamour and social media is glamour. Just remember one word…TWITTER. If Snapchat can pull a Facebook and accelerate their numbers in a major way, then all may be fine. We have no clue how it trades when it comes out.

SOURCE: http://www.foxbusiness.com/markets/2017/03/01/snapchat-prices-shares-at-17-bringing-company-valuation-to-24-billion.html

PRE MARKET NOTES

Futures down a wee bit but after yesterday, no biggie. We remain amazed how since the election, there hasn’t even been a 2% drawdown. The combination of the surprise election, a ton of cash on the sideline and the potential for tax cuts, regulatory relief and the continued monolithic easy money sloshing across the globe…has done the job.

Many are saying this market is waaaay overvalued. They are right…but overvalued can get more overvalued. We have seen it before…and if earnings can explode going forward, valuations come down.

SNAPCHAT going public today. If this was a company selling steel pipes, it would come out at 75% below the IPO value…seriously. 50x sales…not earnings…but 50x sales….massive losses and a recent slowdown in business does not thrill…but glamour is glamour and social media is glamour. Just remember one word…TWITTER. If Snapchat can pull a Facebook and accelerate their numbers in a major way, then all may be fine. We have no clue how it trades when it comes out.

THE CLOSE

Holy heck! Without being political, market loving the Trumpster. We don’t pretend to know why but we certainly know when we are seeing something. New highs for almost everything…and financials again lead the way as they move out also. And there is still a ton of cash on the sidelines. New highs beget new highs…until they don’t. Will have lots more on radio show at 6:06 pm right here at garyk.com. Listen live or soon after…archived.

 

SNAP hitting public markets tomorrow.

SNAP loses lots of money. Business has been slowing. If this was a pipe company, it would be coming public at 1/4 of the price but it is not a pipe company. Valuation is out there but emotion is emotion and price is price. We shall see tomorrow.

SOURCE:  http://www.foxbusiness.com/markets/2017/03/01/snap-to-price-long-awaited-ipo-amid-signs-brisk-demand.html