Market Overview
The Fed lower charges, and shares, which have been already in an uptrend as extensively famous right here, accelerated to new all-time highs. We proceed to see expertise resulting in the upside, which confirms the risk-on atmosphere. The Nasdaq led the rally increased final week, closing up 2.21%. The S&P 500 adopted, closing up 1.22%, whereas the Dow Jones Industrial Common rallied 1.05%. There are nonetheless sturdy alternatives coming from China, which is ready to profit from greenback weak point and decrease charges.
Shares I Like
Domo DOMO – 50% Return Potential
What’s Occurring
- Domo, Inc. (DOMO) is a number one cloud-based software program firm offering enterprise intelligence and knowledge visualization options, enabling organizations to handle and analyze knowledge successfully, providing buyers publicity to the quickly rising enterprise analytics and digital transformation sector with a give attention to data-driven decision-making.
- The corporate’s most up-to-date quarterly report confirmed income of $79.72 million and earnings solely of $879 thousand.
- This valuation on DOMO is combined. Value-to-Gross sales is fairly excessive at 2.16 however Guide Worth is unfavourable at -4.64.
- At a technical stage, DOMO is in search of to breakout from an ascending triangle sample, which factors to a continuation of the development.
Why It is Occurring
- Domo’s strategic partnerships with main cloud suppliers like Snowflake and AWS have been expanded just lately, amplifying the platform’s knowledge integration capabilities. These alliances considerably improve Domo’s product ecosystem and create aggressive moats, enabling it to seize a bigger share of the rising enterprise knowledge analytics market.
- The corporate was just lately ranked #1 vendor in Dresner Advisory Companies’ 2025 Knowledge of Crowds Agentic AI Report, validating its management within the high-growth AI and analytics market. This recognition can increase model popularity and appeal to new enterprise purchasers prioritizing AI-powered insights, which bodes effectively for long-term top-line progress and investor sentiment.
- Analysts stay optimistic with 4 purchase rankings and no promote rankings, underpinned by a worth goal vary averaging $18.50, implying an upside of roughly 18.7% from present ranges. Analyst optimism lends further credibility to Domo’s progress story and might drive elevated institutional curiosity, each of which assist a optimistic inventory outlook.
- Regardless of a traditionally excessive ahead P/E ratio reflecting near-term profitability challenges, the corporate’s ongoing shift to optimistic earnings, enhancing margins, and strong money flows sign an inflection level. Buyers who purchase in now stand to profit from each basic enhancements and a number of growth.
- The corporate’s Subscription Remaining Efficiency Obligations (RPO) climbed to $409.8 million as of July 31, 2025, reflecting a 19% year-over-year enhance. This metric represents contracted future income and is a powerful indicator of sustained buyer dedication and income visibility past simply the present quarter.
- Domo reported a powerful second quarter of fiscal 2026 with whole income reaching $79.7 million, barely outpacing its prior quarter and exhibiting resilience amid market uncertainty.
- Analyst Rankings:
- JMP Securities: Market Outperform
- Cantor Fitzgerald: Obese
My Motion Plan (50% Return Potential)
- I’m bullish on DOMO above $14.25-$14.00. My upside goal is $27.00-$28.00.
elf Magnificence ELF – 50% Return Potential
What’s Occurring
- e.l.f. Magnificence, Inc. (ELF) is a number one cosmetics firm providing reasonably priced, trend-driven make-up and skincare merchandise, offering buyers publicity to the quickly rising magnificence and private care sector with a give attention to accessible, high-quality, and socially engaged branding.
- Within the final quarterly report, ELF confirmed income of $353.74 million and earnings of $51.33 million.
- Valuation could be very excessive. P/E is at 85.42, Value-to-Gross sales is at 6.24, and EV to EBITDA is at 39.09.
- From a technical perspective, ELF is breaking out from a large cup and deal with formation. I am searching for bullish momentum to speed up enormously within the coming weeks.
Why It is Occurring
- The acquisition of Rhode for $800 million marks a strategic growth into the fast-growing skincare section with a premium model based by Hailey Bieber. This acquisition diversifies e.l.f.’s portfolio, enhances its worldwide progress prospects, and affords potential cross-selling synergies, all prone to drive long-term shareholder worth and prudent inventory re-rating.
- e.l.f. Magnificence is actively diversifying its provide chain, lowering China dependence from almost 100% to about 75%. This technique mitigates dangers associated to tariffs and geopolitical tensions, making certain extra steady margins and provide continuity. Such operational resilience can be seen favorably by buyers cautious of world commerce disruptions.
- e.l.f. Magnificence is pioneering AI initiatives throughout social media advertising, IT assist, and operations, positioning itself on the forefront of tech adoption in cosmetics retail. These AI improvements can drive price financial savings, enhanced shopper concentrating on, and customized experiences, which might speed up income progress and margin growth.
- Regardless of a small income miss relative to forecasts, adjusted EBITDA elevated 12% to $87 million, highlighting sturdy working leverage and environment friendly expense administration. This margin growth in a difficult atmosphere alerts administration’s disciplined strategy, reassuring buyers that profitability can enhance even with out booming top-line progress.
- The corporate’s Q1 internet gross sales grew by 9% year-over-year to $354 million, pushed primarily by a strong 30% enhance in worldwide gross sales and a 5% rise in U.S. gross sales.
- e.l.f. Magnificence delivered a powerful fiscal Q1 2026 earnings beat with an EPS of $0.89, exceeding consensus estimates of $0.84 by about 6%.
- Analyst Rankings:
- Raymond James: Robust Purchase
- Morgan Stanley: Obese
My Motion Plan (50% Return Potential)
- I’m bullish on ELF above $120.00-$122.00. My upside goal is $210.00-$220.00.
Rigetti Computing RGTI – 14% Return Potential
What’s Occurring
- Rigetti Computing, Inc. (RGTI) is a pioneering quantum computing firm creating superior quantum processors and software program, providing buyers publicity to the quickly rising quantum expertise sector with a give attention to scalable, high-performance computing options.
- The corporate’s current quarterly report confirmed income at $1.8 million and a lack of $16.84 million.
- Valuation in RGTI is up within the clouds. Value-to-Gross sales is at 604.95, and the Guide Worth is simply 1.71.
- From a charting perspective, RGTI broke out from a completely large cup and deal with formation. The quantum story is not completed, people.
Why It is Occurring
- Rigetti secured a big $5.8 million, three-year contract from the U.S. Air Drive Analysis Laboratory targeted on advancing superconducting quantum networking expertise. This partnership not solely supplies regular authorities funding but in addition establishes Rigetti as a trusted associate in essential nationwide safety expertise, seemingly rising credibility and opening doorways for future contracts that might drive long-term income progress.
- Rigetti’s progressive quantum processor, the Cepheus-1-36Q, options 36 qubits utilizing a multi-chiplet structure with 99.5% median two-qubit gate constancy. This cutting-edge expertise represents a leap ahead in qubit efficiency and scalability, positioning Rigetti as a frontrunner in superconducting quantum computing.
- Rigetti’s modular chiplet strategy to quantum computing structure, which interconnects a number of smaller chips moderately than counting on single massive chips, addresses key scalability challenges within the quantum business. This architectural innovation is more and more acknowledged as a extra viable path to large-scale quantum computer systems, enhancing Rigetti’s aggressive positioning towards rivals who face limitations with single-chip expansions.
- The corporate strengthened its monetary place dramatically in 2025, finishing gross sales of $350 million in gross proceeds from widespread inventory choices and boosting its money and money equivalents to $571.6 million with no debt.
- Regardless of income challenges with Q2 2025 income of $1.8 million declining 42% year-over-year because of the expiration of the Nationwide Quantum Initiative, Rigetti’s sequential quarterly income progress (+20%) signifies ear
- Analyst Rankings:
My Motion Plan (14% Return Potential)
- I’m bullish on RGTI above $22.00-$23.00. My upside goal is $32.00-$33.00.
Market-Shifting Catalysts for the Week Forward
A Falling Charge Setting is Right here – What’s Subsequent?
Right here we’ve got it – the Fed lower rates of interest 25-basis factors. Lengthy-term bond yields are dropping quicker than short-term yields, as I am going to clarify in a while on this report. However we’re seeing indicators of a refinance increase that might increase the economic system and carry shares to new highs.
However as I have been warning, the Fed is enjoying with inflationary fireplace. In some unspecified time in the future, it should make it is dreaded return, and that is when the Fed and even the Division of Treasury goes to be put in a pinch.
I am not ruling out yield curve management (YCC) coming to the US in a few years. There actually will not be one other selection, and if there’s any hope of managing (not sustaining) the federal debt, it is the one tangible answer.
Sentiment Follows Value, Not the Different Method Round
The market’s current worth motion is a wonderful reminder of how corrections can happen by way of time as a substitute of worth. And through this “time,” all kinds of causes to be bearish will come to the floor.
Now that we have damaged out to new all-time highs, and the market has come to time period with rates of interest falling, we’re beginning to see bullish sentiment rise to its highest stage in months. If something, this warns to not chase this rally.
Does this imply we’re robotically going decrease? Quite the opposite. However we have to suppose by way of risk-reward. No one is aware of what the market goes to do, and anybody that pretends like they do is somebody it’s best to keep away from. The development is up, however near-term, the gang has realized they have been fallacious and at the moment are panic shopping for into new all-time highs.
Sector & Business Energy
The tape does not lie. We noticed new all-time highs final week throughout the board after the Fed lower charges, and as soon as once more, the standout sector was expertise (XLK). It is no shock to see shares so sturdy with all the proper growth-oriented sectors outperforming.
In the meantime, all the defensive sectors proceed to do poorly. After we’re seeing healthcare (XLV), shopper staples (XLP), vitality (XLE), and utilities (XLU) all within the backside half of the sector rankings, that the market is pricing in additional progress.
Now we have to be desirous about which sectors are prone to do effectively below a falling charge atmosphere. It is going to preserve serving to tech, however we must also watching shopper discretionary (XLY) and actual property (XLRE) as effectively.
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Editor’s Notice: It is Tech’s Market – We’re Simply Buying and selling It.
The place’s the “New Cash” Going? (Sector ETF: DBC/SPY)
We’re in a falling rate of interest atmosphere now. The Federal Reserve is slicing, which implies that cash is being printed. This “new cash” goes to need to discover a house someplace, and odds favor it going into shares.
But it surely’s not simply going to enter shares. With the Fed enjoying with inflationary fireplace, we’ve got to take a look at the commodity sector, as a result of that’s what drives inflationary pressures probably the most. For this reason I am wanting on the ratio between commodities (DBC) and the S&P 500 (SPY) this week.
It has been a reasonably clear downtrend for the previous couple of years. In different phrases, commodities have underperformed as inflation has cooled. However we have to keep watch over this ratio, particularly if it clears the higher trendline of the channel. As a result of if it does, we might begin to see inflation change into a really actual threat in 2026.
Are You Ready for an Period of Chinese language Tech Dominance? (Sector ETF: CQQQ/QQQ)
I can not stress sufficient the significance of this ratio. Folks have been in love with the Nasdaq 100 (QQQ) right here in the US for years. However let’s always remember that this can be a international market, and the perfect alternatives will not all the time be stateside.
The emergence of the Chinese language tech sector (CQQQ) as a severe contender within the AI arms race can’t be understated. And if we take a look at this ratio between CQQQ and QQQ, we might be smart to not ignore the sector in any respect.
The rounding backside sample on this chart means enterprise. If it breaks above resistance, I might be rather more targeted on what is going on on within the Chinese language tech sector than within the U.S. tech sector. Many can be reluctant to pursue it, which is able to make it all of the stronger of a development.
What Charge Cuts Imply for Bonds (Sector ETF: BIL/TLT)
It is beginning to occur. We’re seeing long-term bonds accelerating of their current outperformance towards short-term bonds, which is just going to power the Fed to proceed slicing till inflation turns into an issue.
I am wanting on the ratio right here between short-term Treasury Payments (BIL) and long-term Treasuries (TLT). I wish to draw your consideration to the false-breakout from the triangle formation again in Could that additionally ended up being a lower-high.
This signaled that the tide may very well be turning and decrease rates of interest have been coming. If the development is about to show down, it should imply that TLT is shaping up for a wonderful commerce, not funding, over the subsequent a number of months.
My Take:
I wish to be clear and differentiate between a commerce and funding on the TLT facet of issues. The debt disaster in Washington is severe. We all know this already. However charges are coming down for the subsequent yr or so, and usually, longer length outperforms in such an atmosphere.
However as soon as inflation rears its ugly head once more, TLT, or bonds with longer length, will get hammered probably the most. I might then count on this ratio to start out climbing again to the upside, however till then, length is the commerce right here.
Cryptocurrency
I wish to shift gears a bit this week. In the event you’ve been following alongside on the Ethereum setup over the previous couple of months, you are most likely fairly happy with the outcomes. However this week, I wish to take a look at one other key DeFi coin – Solana.
The setup in Solana is unbelievable, and I simply do not see lots of people speaking about it. There’s a large, stunning saucer formation current on the day by day chart for Solana. The length of this sample implies {that a} main transfer is underway.
An in depth above 250-260 would signify a breakout from the formation. This sample is projecting a rally as much as the 480-500 space a minimum of. In the event you’re not making ready for an altcoin season, you have to be. The trail of least resistance is increased in Solana so long as it stays above 215-220.
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