🤖📈 Top Trade Ideas for July 12

The investment case for Alphabet suggests an average EPS growth in the low-teens over time, primarily driven by Google Advertising growth, operational leverage, profitability in Google Cloud, and Other Bets. The shares forecast a 55% total return by 2025, largely driven by a ~12% EPS CAGR, and an upward P/E re-rating. The main risk comes from government actions, such as the European Commission's announcement of a preliminary view that Google's advertising technology breaches anti-trust rules and Canada's passing of the Online News Act, which could force digital platforms to share revenues with news businesses. However, the consequences of these actions are believed to be limited due to Google's value proposition for businesses and consumers. Q2 results, expected to be released in late July, are predicted to show relatively weak revenue growth. Watch items include Alphabet’s cost-efficiency efforts and YouTube’s performance against potential growth acceleration at Meta Platform’s Reels.

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The author is bullish on KeyCorp and predicts positive Q2 results. KeyCorp, the parent company of KeyBank, has notable metrics and a strong financial condition. The stock is currently trading below its 200-day SMA, which the author sees as a buying opportunity. They predict that the stock will turn bullish after the Q2 earnings call and have a target sell price range. The stock is undervalued compared to its peers and beats two regional bank peers on valuation metrics. It has a high dividend yield and has shown positive dividend growth. The author believes that KeyCorp's business model has been positively affected by macro factors such as Fed rate increases. The net interest income and net interest margin have benefited from higher earning asset balances and higher interest rates. The author predicts that KeyCorp will continue to benefit from rate hikes and suggests that another rate hike in Q3 could benefit the bank. The author gives KeyCorp a strong buy rating and highlights the positive outlook for the stock. Two risks to consider are exposure to commercial real estate and exposure to non-FDIC insured deposits. However, the author believes that the credit quality of KeyCorp is under control. They conclude by reiterating their strong buy rating and expressing positivity about the Q2 figures.

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High-risk, high-reward play with a potential near-term catalyst. EOS Energy is a zinc based grid scale battery storage provide that's currently waiting on a loan from the Dept of Energy (to help build out their new Z3 battery lines). The loan could possibly be announced on July 18th when Jill Biden stops by Pittsburgh for her Investing in America tour. EOS plans to hire 700 people in the Pittsburgh area for manufacturing and the Department of Energy has stated the need for long-term enery storage; hence the political aspect. The existing battery storage companies (like Tesla) cannot handle all of the global energy storage needs and EOS is focusing on longer-term storage than the Tesla Megapack.

This trade idea was submitted by @scottnixonish on Twitter. Click here to read a longer Twitter thread about the idea.