Once in a while a sector in a sector (Sub-sector) gets ignored. This can happen for a variety of reasons, but usually it’s because of World events and market activity thatis taking all the attention away.

This can sometimes present us with some very interesting opportunities within these sub-sectors, and it’s situations like this we like to look at.

The best part about these types of situations, is that 9 times out of 10 it’s only a matter of time until these sub-sectors catch up, and if we can dig out some solid looking companies before they get caught up with, it can result in good buying opportunities.

If you’re interested in hearing about some of the companies we look at in this space, then simply enter your email in the box provided below, and we will email you once we’ve concluded assembling the information we’ve found.

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Ethereum Nosedives to $250 in Massive Crypto Market Dump

The number two cryptocurrency by market cap, Ethereum, just experienced a massive dump alongside many other major crypto assets, including Bitcoin and the rest of its altcoin brethren.

Is the 2020 crypto rally finally finished, or is this just another opportunity to buy the dip across the crypto market before further upside in the days ahead.

Ethereum Drops to $250 in Crypto Market Mayhem

Ethereum just lost as much as 10% of its value in a matter of just one hour, as the smart-contract focused altcoin’s rally may finally be finished.

The cryptocurrency has been rallying since the start of 2020 and had been up to over 100% at recent highs since the year first began.

But the number two cryptocurrency by market cap has struggling to set a new high, and after this latest collapse that wiped out 10% from the value of Ethereum, it’s starting to look like the crypto bull market is taking a quick break.

In a matter of an hour, Ethereum fell from highs around $286 to as low as $250, before finding support.

ethereum price chart

The current local high of the entire rally is set at $290, failing to reach its 2019 high of $364.

Resistance from $285 all the way up to $300 may have proven to be too powerful for bulls to break through.

Bearish crypto traders may have the high volume, top-like reversal they were looking for, however, the drop failed has thus far failed to set a lower low on daily timeframes.

On Sunday, Ethereum dropped to $236 before rebounding back toward local highs.

But the rally has thus far failed to hold and was rejected back down to find support.

Is the Crypto Rally of 2020 Over?

At the time of this writing, $250 is holding strong, and Ethereum has already rebounded, but additional downside cannot be ruled out.

After over 60 days of uptrend and 100% gains, a retracement isn’t out of the question, although some crypto analysts are claiming that it make take weeks or months to occur.

This latest turn for Ethereum could result in new lows being set, or if a bull market is in effect, dips will be bought with fury and speed, and in no time at all, Ethereum will be back to setting new locals highs.

Tesla’s battery strategy will be key to Cybertruck and Semi’s market disruption

Elon Musk has remarked that Tesla has arguably the most exciting product roadmap of any company today. With vehicles like the Semi and the Cybertruck coming in the pipeline, this statement rings true. But things will not be as easy as simply setting up production lines for the upcoming vehicles. For Tesla to properly ramp the Semi, for example, the company would have to make sure that it can get enough cells for the vehicle first.

Producing electric cars is no easy task, and a lot of the challenges in EV making are connected in one way or another to vehicles’ batteries. This is something that is being learned by veteran carmakers like Jaguar today, as inadequate supply from battery companies like LG Chem has resulted in a halt of production for premium EVs like the I-PACE. Tesla is certainly aware of the battery supply challenges that EV makers face. This is one of the reasons why Gigafactory Nevada was constructed.

Giga Nevada was built to support the company’s Model 3 ramp. Designed to manufacture the 2170 cells of the Model 3 with battery partner Panasonic, the massive facility forms the backbone of Tesla’s first foray into the mass market. But the story lies far beyond the Model 3 today. Tesla has an even higher-volume vehicle coming, the Model Y. The Cybertruck will likely sell in large volumes too, provided that the market embraces it. Just like the all-electric pickup, the Semi might see sufficient demand from the trucking market once it’s released as well, considering the cost benefits that the vehicle offers.

Tesla CEO Elon Musk unveils futuristic Cybertruck in Los Angeles
Tesla CEO Elon Musk unveils futuristic Cybertruck in Los Angeles, Nov. 21, 2019 (Photo: Teslarati)

Tesla is in a constant state of change, and this cannot be represented better than the company’s batteries. President of Automotive Jerome Guillen has noted that Tesla’s batteries are never static since they’re always being improved. Today, it is becoming more and more evident that Tesla’s batteries are among the best in the industry, particularly when it comes to energy density. Coupled with its vertically-integrated software, Tesla’s batteries can give vehicles impressive range even if they are not too large.

The Model 3, for example, can squeeze out over 320 miles of range from a 75 kWh battery, and the Model S Long Range Plus can get 390 miles from a 100 kWh pack. This matters a lot, and it shows just how far ahead the company is when it comes to its batteries and their energy density. And this, ultimately, will likely help the company secure enough battery cells to support the ramp of its upcoming EVs, including the Semi and the Cybertruck, both of which are large vehicles that would usually require a massive pack to hit their target range.

Tesla lists the Semi with a range of 300 to 500 miles. The company never announced the size of the Semi’s battery pack, but considering that the vehicle is a Class 8 truck that can accelerate from 0-60 mph in 20 seconds with a full load, speculations for the vehicle’s battery from the EV community included estimates that were as high as 1 MWh. The same concept applies to the Cybertruck. The vehicle is very heavy, and it is expected to have over 500 miles of range. To get this range, a large battery pack would usually be required.

But with Tesla’s constant innovations on its batteries, this does not necessarily have to be the case. Considering that Tesla is closing in on 400 miles per charge on a 100 kWh pack with the Model S, there is a good chance that its next vehicles like the Cybertruck and Semi will be equipped with fewer, but more energy-dense cells than initially expected. Tesla has pretty much developed the skill of drawing out as much range as possible from every cell in an EV, so it’s not too farfetched to infer that the company will be very efficient with the batteries of its upcoming vehicles.

More energy-dense batteries will be key to lowering production costs as well. Tesla may be drastically reducing its battery costs, but the packs themselves still comprise a huge portion of each of its vehicles’ prices. If Tesla can use slightly smaller packs that are still capable of providing optimum range, Tesla can make sure that its EVs like the Semi and the Cybertruck will be as competitive as possible when they enter the market.

The Tesla Semi and the Cybertruck are competing in the trucking and pickup market, two very lucrative segments in the automotive industry. Interestingly, both segments are also ripe for disruption, with most veterans such as Freightliner and the Ford F-150 sticking to tried and tested strategies to thrive today. Tesla needs a key to ensure that it can have a fighting chance when it enters the trucking and pickup segment with the Semi and Cybertruck. If challenges faced by electric car makers today are any indication, it appears that batteries and their energy density will be the difference-maker. Fortunately, these just happen to be two things that Tesla has been obsessively pursuing since the company was founded less than 17 years ago.

We’ve Vastly Underestimated How Much Methane Humans Are Spewing Into The Atmosphere

Tiny bubbles of ancient air trapped in ice cores from Greenland suggest we’ve been seriously overestimating the natural cycle of methane, while vastly undervaluing our own terrible impact.

Methane is an ‘invisible climate menace’ – roughly 30 times more potent as a heat-trapper than carbon dioxide – and while some of this atmospheric gas is produced naturally, new research indicates humans are responsible for far more of it than we thought until now.

Before the industrial revolution, when humans began to extract and burn fossil fuels on the regular, natural methane emissions were an order of magnitude smaller than current estimates, the study suggests.

Today, this means our own methane emissions might be up to 40 percent higher than suspected.

“Our results imply that anthropogenic methane emissions now account for about 30 percent of the global methane source and for nearly half of [all] anthropogenic emissions… ” the authors write.

Over the past three centuries, methane emissions have shot up by roughly 150 percent, but because this atmospheric gas is also produced naturally, it’s been difficult to tell exactly where the emissions are coming from.

To figure out the scope of our own impact from coal, oil and natural gas, it’s therefore necessary to know how much methane comes from wetlands and other natural sinks.

“As a scientific community we’ve been struggling to understand exactly how much methane we as humans are emitting into the atmosphere,” says Vasilii Petrenko, a geochemist from the University of Rochester.

“We know that the fossil fuel component is one of our biggest component emissions, but it has been challenging to pin that down because in today’s atmosphere, the natural and anthropogenic components of the fossil emissions look the same, isotopically.”

There is one rare radioactive isotope however, known as carbon-14, which is contained in biological methane and not in fossil fuel methane.

By drilling and collecting ice cores in Greenland, Petrenko and his colleagues were able to use this isotope as a sort of time capsule for past atmospheres, ranging from roughly 1750 to 2013.

Until about 1870, the findings suggest very low levels of methane were emitted into the atmosphere and almost all of it was biological in nature. Only after this date was there a sharp increase in methane, coinciding with an increase in fossil fuel use.

In practice this means that each year, the scientific community has been underestimating methane emissions from humans by as little as 25 percent and as high as 40 percent. And while that might sound entirely grim, the authors see a silver lining on the edge of this dark cloud.

“I don’t want to get too hopeless on this because my data does have a positive implication: most of the methane emissions are anthropogenic, so we have more control,” says University of Rochester geochemist Benjamin Hmiel.

“If we can reduce our emissions, it’s going to have more of an impact.”

Compared to carbon dioxide, methane is short-lived in the atmosphere, so stricter regulations could have a sizeable impact on future greenhouse gas emissions.

And, at least in the United States, there’s plenty of room for improvement in that respect. A study in 2018, for example, found methane emissions from oil and natural gas were 60 percent higher than those reported by the US Environmental Protection Agency.

This missing chunk could be part of the reason why we are currently underestimating methane emissions so much. It seems that what we are reporting on the ground is not matching up with what’s going on in the sky.

The study was published in Nature.

Best airline for on-time arrivals

Delta Airlines had the most on-time arrivals in the last months of 2019 compared to other U.S. major airlines, according to a Wednesday report.

U.S. airlines with the highest rates of on-time arrivals between December and January of 2019, according to the U.S. Department of Transportation include:

  • Delta (84 percent)
  • Alaska (81.3 percent)
  • Southwest (80.2 percent)
  • Spirit (79.5 percent)
  • Allegiant (78.7 percent)
  • American (77.4 percent)
  • United (75.2 percent)
  • JetBlue (73.5 percent)
  • Frontier (73.1 percent)

While Spirit ranked fourth among major airlines for on-time flights, Consumer Reports ranked the newcomer airline known for its ultra-low-cost flights the “worst airline in America” in a 2018 report based on flights that took place between 2016 and 2017. The airline received a score of 62 points out of 100, followed by Frontier, which received a total of 63 points.

Southwest, Alaska and JetBlue, by comparison, all ranked within the top three best airlines in the U.S., according to the Consumer Reports study.

Delta is the second-biggest airline in the world and in the U.S., falling just behind American Airlines. United, Southwest and Alaska also made the top-20 list of the world’s largest airlines, Business Insider reported in March, citing research from air-travel data firm OAG.

Hawaiian Airlines Network had the best overall on-time performance at 87.6 percent, but the smaller airline and its partners fly out of 22 airports compared to the 223 airports where passengers can catch flights with Delta and its partners.

Mediterranean diet may trigger gut bacteria changes linked to longevity

The Mediterranean diet, a popular eating protocol often recommended by health authorities, is the subject of a new study that evaluated its effects on cognition and aging. The results were promising — it turns out that eating this particular diet leads to important gut bacteria changes, reducing one’s risk of developing many health problems. The findings are particularly good news for the elderly.

The Mediterranean diet has been the subject of many studies over the years; it is known as a heart-healthy diet, but the benefits may extend beyond reducing one’s risk of developing heart disease. According to a new study recently published in Gut, the changes to gut bacteria that result from this diet may promote healthy aging and reduce the risk of various diseases like cancer and diabetes.

The study involved data on the gut microbiome of 612 elderly people from various European nations. Around half of these people were put on a Mediterranean diet for one year, whereas the remaining participants ate their usual diets for the same year. After the 12 months were over, the study found that participants who ate the Mediterranean diet had more bacterial diversity in their gut compared to the other participants.

As well, the diet reduced the production of inflammatory markers that may cause harm, including interleukin-17. At the same time, these dieters were found to have experienced the growth of gut bacteria associated with brain function and memory. The benefits continued from there, with the team also finding that some gut microbiome changes were linked to slowed frailty, potentially helping elderly people maintain their independence for longer periods of time.

The findings join a large body of research highlighting the Mediterranean diet’s many potential health benefits, which include everything from healthier BMIs to stronger bones, lowered cholesterol, decreased risk of diabetes, improvements to depression, and more. The American Heart Association maintains a site dedicated to the diet, including recipes and facts.

New Bed Bath & Beyond CEO: ‘We are hungry for change’

We imagine new Bed Bath & Beyond CEO Mark Tritton hasn’t gotten much sleep since he assumed the top spot at the struggling home furnishings retailer about 100 days ago.

“I am actually sleeping, and I am prioritizing that to make sure I am fresh and focused. It’s really important to build your resilience in these times, especially when I am drinking from a firehose and laying the foundation and making some big critical decisions about how we stabilize and grow our business,” Tritton told Yahoo Finance Tuesday evening in one of his first interviews since taking over. “I am staying resilient and focused, and using every tool in my toolkit.”

Certainly one can’t blame Tritton if sleep is the last thing on his mind at the moment.

Tritton has been non-stop at Bed Bath & Beyond (BBBY) pretty much since walking in the door after a successful stint in the C-suite at discounter Target. Tritton is credited by many on Wall Street as helping to craft Target’s successful turnaround plan, working hand in glove with current chairman CEO Brian Cornell.

Tritton’s first big move at Bed Bath & Beyond was to part ways with six long-time executives in one press release. It’s the type of house cleaning this former retail stock analyst has never seen before, but reflective of the years of poor execution in stores and online at Bed Bath & Beyond (and plunging stock price).

“When I came in there was very congealed thinking, there was no agility and no action. There were some real burning platforms that needed to be addressed,” Tritton explained, referring to the headline-grabbing leadership shakeup.

While deciding on who to keep in the C-suite, Tritton was also evaluating the company’s portfolio of assets with an eye on divesting non-core operations to raise cash to support a turnaround. For years, Wall Street has wondered why Bed Bath & Beyond operated a highly seasonal business such as Christmas Tree Shops. A portfolio evaluation is a hard gig for any retailer, but especially one like Bed Bath & Beyond that lists only two executives on the investor relations page — Tritton and CFO Robyn D’Elia.

Tritton told Yahoo Finance he has been relying on consultants Bed Bath & Beyond hired before his arrival to assess the business and some strong employees that had been at the company. Goldman Sachs has been tapped to shop non-strategic assets, Tritton said.

Tritton said he is nearing the end of his executive search and plans to make announcements in the coming weeks.

The lack of an executive team hasn’t stopped Tritton from starting to take some shareholder-friendly action.

A few strategic moves

Tritton orchestrated a sale leaseback transaction on January 6 with Oak Street Real Estate Capital for 2.1 million square feet of commercial real estate. The deal netted Bed Bath & Beyond $250 million.

And then today, Tritton returned with some more positive news. Bed Bath & Beyond said earlier it sold PersonalizationMall.com to 1-800 Flowers for a cool $250 million. Considering most on Wall Street had never even heard of this asset, the $250 million was a nice win.

After the market close, Tritton revealed a $1 billion capital return program. For 2020, Bed Bath & Beyond expects $600 million in total spending on share repurchases, dividends and debt reduction. Another $350 million to $400 million will be set aside for capital expenditures, or investments in technology projects and supply chain improvements.

That’s not to say Tritton has been the bearer of bad news early in his tenure. Wall Street has given Tritton a pass by and large as subpar sales reflect the lack of action by now ousted executives. But it has still been tough on the eyes.

On January 8, Bed Bath & Beyond revealed a challenging third quarter.

Come February 11, Bed Bath & Beyond’s stock plunged 25% on the disclosure that the holiday shopping season was far worse than feared. The period marked the ninth straight quarter of same-store sales declines. Wall Street fretted a turnaround under Tritton would take longer than expected.

“Shares could remain range-bound over the next few months as investors balance announcements of strategic actions with a continued deterioration in fundamentals and limited visibility,” wrote Jefferies analyst Jonathan Matuszewski in a note to clients. He rates the stock a Hold with an $11 price target.

All in all, a heck of a four-month stretch for Tritton.

“We are hungry for change,” Tritton said. Bed Bath & Beyond shareholders would echo that.

Nike announces leadership shuffle under new CEO

Nike, with a new CEO at the helm, announced leadership changes Tuesday that include a new chief operating officer and chief financial officer.

Andy Campion, the current executive vice president and CFO, will replace Eric Sprunk as COO, effective April 1, the company said in a statement, adding that Sprunk will depart Nike.

The company said Matthew Friend, its current CFO of operating segments and vice president of investor relations, will become its new CFO.

Nike stock rose less than 1% after hours on the news. Nike has a market value of nearly $159 billion, and its stock has gained more than 19% over the past year.

In October, Nike announced John Donahoe, a Nike board member and former CEO of eBay, would replace its longtime CEO Mark Parker, effective Jan. 13. Parker, who was named executive chairman, said at the time of the announcement that he would be “partnering closely with John and the management team.”

As part of the announcements Tuesday, Heidi O’Neill, president of Nike Direct, will become president of consumer and marketplace on April 1. She succeeds Elliott Hill, who will leave Nike, the company said. Nike did not say when Hill and Sprunk will depart the company.

“Heidi and Andy’s leadership has been instrumental in both evolving and driving Nike’s strategy over the last decade,” John Donahoe, president and CEO of Nike said, in a press release. “In their new roles, we will see them have even greater impact on Nike’s success in the future. Matthew brings more than 10 years of Nike experience to the CFO role and will be a great addition to our executive leadership team.”

The leadership changes come as Nike faces mounting scrutiny over allegations of doping as well as gender discrimination. In October, Parker said an interview with CNBC’s Wilfred Frost that Donahoe should “enable this next level of growth,” digitally, for the company.

He also said the decision was not prompted by doping allegations connected to Nike’s Oregon Project, the elite training group run by Nike’s head running coach Alberto Salazar.

At the end of September, Salazar was banned amid doping allegations, which reportedly included ties back to Parker himself. The New York Times reviewed emails from the U.S. Anti-Doping Agency that showed Parker had been briefed on Salazar’s various experiments to use testosterone cream for track-and-field athletes.

In an email to employees at the time, Parker said: “Nike did not participate in any effort to systematically dope any runners ever; the very idea makes me sick.” He also said Nike looked into the allegations against Salazar and found no violations.

In 2018, Nike President Trevor Edwards, who many saw as Parker’s likely successor, retired after complaints surfaced at the company in March 2018, when a group of women presented Parker with a survey on gender discrimination. Edwards was blamed in the lawsuit for creating and exacerbating a “hostile work environment.” Parker responded by restructuring his leadership team, which included ousting Edwards.

Nike in 2018 admitted it failed in hiring and promoting women, and the company ousted at least 11 executives and announced raises for 7,000 employees after conducting an internal review of its pay practices. Parker apologized to employees at large in May.

SpaceX will launch private citizens into orbit

SpaceX is planning to send up to four private citizens into space to take a trip around Earth sometime at the end of 2021 or in early 2022. The spaceflight company announced an agreement on Tuesday with Space Adventures, a space tourism business that has helped seven different private citizens take trips to (and from) the International Space Station aboard Russia’s Soyuz rocket and spacecraft.

Space Adventures said the price of the mission will not be disclosed, and the two companies were light on other details, like what kind of preparation the tourists will have to go through. The companies did say Tuesday that the tourists will fly in the human-rated version of SpaceX’s Dragon spacecraft and that they will orbit Earth at two to three times the roughly 250-mile height of the ISS.

SpaceX has spent the last few years building and testing out this new version of Dragon as part of a contract with NASA to shuttle astronauts to and from the ISS, after years of using the spacecraft to shuttle cargo to the space station. The private spaceflight company recently completed the second major flight test of the Crew Dragon, as it’s called, which demonstrated the capsule’s ability to escape an exploding rocket.

SpaceX CEO Elon Musk has teased the idea of space tourism as a business for a few years now, though he’s been overly optimistic about how soon that could happen. The company announced in early 2017 that it had accepted undisclosed payments from two customers for a trip around the Moon using Crew Dragon and the Falcon Heavy rocket. SpaceX said at the time that the trip would happen by the end of 2018. But in September 2018, the company announced that it now intends to send one of those passengers — Japanese billionaire Yusaku Maezawa — around the Moon using the company’s massive, yet-to-be-built Big Falcon Rocket. (It’s still unclear what happened to the second customer.)

SpaceX has similarly had to delay the first Crew Dragon flight with NASA astronauts as it worked through the process of certifying the spacecraft with NASA. That flight is now supposed to take place later this year.

Other private spaceflight companies are vying to establish the space tourism market. Richard Branson’s Virgin Galactic and Jeff Bezos’ Blue Origin are in the running, though both of those companies are promising far briefer experiences. Virgin Galactic says it plans to send its first space tourists up later this year where they will experience a few minutes of weightlessness in the company’s plane-like spaceship. Blue Origin is promising customers a similar amount of time in space, though in a spacecraft that’s more similar to SpaceX’s Dragon capsule. (Both of those tickets cost in the neighborhood of $200,000 a pop.)

While little is known about the newly-announced flight, SpaceX has detailed the inside of the Crew Dragon spacecraft that will ferry the tourists around the Earth. The capsule’s interior is a minimalist affair, with just a few suspended seats and an array of touchscreens. The spacecraft is ringed with windows, though they’re not as large as the ones Blue Origin built into its own capsule. SpaceX has also shown off sleek, custom-designed spacesuits and helmets that Crew Dragon passengers will wear. The suits are less bulky-looking than past designs, but are still pressurized, cooled, and flame resistant. They come with touchscreen compatible gloves, and will lock into the seats for the ride up to space.

Extreme Weather Could Bring Next Recession – Risk Unaccounted for in Financial Markets

Market Needs to Plan for Weather Risk, or Face Extreme Correction
Physical climate risk from extreme weather events remains unaccounted for in financial markets. Without better knowledge of the risk, the average energy investor can only hope that the next extreme event won’t trigger a sudden correction, according to new research from University of California, Davis.

The paper, “Energy Finance Must Account for Extreme Weather Risk,” was published February 17 in the journal Nature Energy.

“If the market doesn’t do a better job of accounting for climate, we could have a recession — the likes of which we’ve never seen before,” said the article’s author, Paul Griffin, an accounting professor at the UC Davis Graduate School of Management.

The central message in his latest research is that there is too much “unpriced risk” in the energy market. “Unpriced risk was the main cause of the Great Recession in 2007-2008,” Griffin said. “Right now, energy companies shoulder much of that risk. The market needs to better assess risk, and factor a risk of extreme weather into securities prices,” he said.

For example, excessive high temperatures, like those experienced in the United States and Europe last summer, can be deadly. Not only do they disrupt agriculture, harm human health and stunt economic growth, they also can overwhelm and shut down vast parts of energy delivery, as they did in Northern California when PG&E shut down delivery during fires and weather that could trigger fire. Extreme weather can also threaten other services such as water delivery and transportation, which in turn affects businesses, families and entire cities and regions, sometimes permanently. All of this strains local and broader economies.

“Despite these obvious risks, investors and asset managers have been conspicuously slow to connect physical climate risk to company market valuations,” Griffin said in his article.

“Loss of property is what grabs all the headlines, but how are businesses coping? Threats to businesses could disrupt the entire economic system.”

Climate-vulnerable locations also factor into risk for energy markets. In the United States, U.S. oil refining is located on the Gulf Coast, an area exposed to sea-level rise and intense storms. Oil refining in Benicia and Richmond, in Northern California, can be exposed to coastal flooding. Energy companies’ transmission infrastructure is located in arid areas, increasing risk of damage, such as the destruction from recent wildfires in California. In addition, it is not clear insurance will be available to cover such risks. Add to those risks, Griffin said, “litigation, sanctions and even loss of business from the property destroyed.

“The climate litigation risk already priced into energy stocks (after, for example, a protracted ExxonMobil court case in the 1990s) would prove insufficient.”

Extreme weather climate risk, in summary, is hard to predict.

“While proprietary climate risk models my help some firms and organizations better understand future conditions attributable to climate change, extreme weather risk is still highly problematic from a risk estimation standpoint,” he concluded in the article.

“This is because with climate change, the patterns of the past are no guide to the future, whether it be one year, five years or 20 years out. Investors may also normalize extreme weather impacts over time, discounting their future importance.”

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