Latest news with #JonSmith
Yahoo
05-06-2025
- Business
- Yahoo
This popular UK stock is shifting to the US. Here's what I think it means for the share price
In news out today (5 June), Wise (LSE:WISE) announced that it's planning to list its shares in the US. The move would see the US listing become the company's main one while maintaining a secondary listing on the London Stock Exchange (LSE). The news came as a surprise to some, but the stock rocketed over 12% higher on the news. Here's what I think happens next. For the LSE in general, it's not great news. It's yet another company shifting to the US. For several years, there have been worries about low valuations and weak liquidity in UK markets, which has meant several management teams have decided to look across the pond. Some companies have moved to the US with the primary listing and then decided to cancel the UK listing altogether. There are no immediate signs that Wise will do the same, but it's probably a thought in the back of some investors' minds. In terms of the specifics why Wise has chosen to move, the CEO commented that 'we believe the addition of a primary US listing would help us accelerate our mission and bring substantial strategic and capital markets benefits to Wise and our owners'. He also noted the US is 'the biggest market opportunity in the world for our products'. The immediate reaction to the share price clearly shows positive sentiment. Firstly, being listed in the US will allow retail investors there to more readily buy the stock. Yet more than that, the listing will create more publicity around the business. If Wise can then gain more traction and scale, it will grow revenue and profits. This, in turn, should help the share price of the UK listing rally. With the second listing, Wise will be able to raise more capital. This can be used to develop new products and enhance the offering to clients. I see this as a good thing, as it means the business does not have to use debt or even retained earnings to fuel its growth. As a fintech company, Wise faces a lot of competition. Not only are there other disrupters in this space, but traditional banks are also trying to regain some of the lost market share. Therefore, Wise has to try to stay ahead of the game; otherwise, customers could be easily lost. Another factor is valuation. With a price-to-earnings ratio of 97, it's certainly not cheap! The stock is up 45% over the past year and has hit fresh 52-week highs this morning. I think the optimism around the jump today should ease off, but when I look at the stock with a long-term lens, I think the move to the US could be a smart move. I'm putting it on my watchlist to consider buying once the dust settles on this news. The post This popular UK stock is shifting to the US. Here's what I think it means for the share price appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool Jon Smith has no position in any of the shares mentioned. The Motley Fool UK has recommended Wise Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025
Yahoo
07-03-2025
- Business
- Yahoo
This S&P 500 darling is down 25% in the past month! Here's what's going on
It has been a jittery start to March for the US stock market. Concerns around tariffs and the impact they could have on economic growth and inflation have caused some investors to get worried. Some S&P 500 stocks have seen a significant move lower in a short space of time. Here's one that has fallen that I think could be worth buying. I'm referring to Vistra Corp (NYSE:VST). The stock is down 24.6% over the last month, but still up 122% over the past year. Vistra's a US-based energy company engaged in the production and distribution of electricity and related services. One reason why the stock has struggled so far in 2025 is due to the rise of DeepSeek, a Chinese AI-model that was reportedly trained and built for a fraction of the cost of other large language models (LLMs). You might think that this story doesn't really have anything to do with Vistra, but you'd be wrong. A key reason for the surge in the stock over the past year has come because the energy infrastructure it owns is seen as the future for powering AI projects. The ability to fuel such energy-hungry processors means that Vistra could see revenue significantly increase in coming years. However, the DeepSeek breakthrough caused the stock to fall. If investors have to dial back optimism about how much electricity is actually going to be needed, then maybe Vistra won't be as profitable as initially thought. Another factor has been lower electricity prices. The mild winter in the US has further reduced electricity demand, putting downward pressure on energy company revenues. Despite the short-term negatives, it doesn't change the fact that Vistra is still hot property. The 2024 results mentioned that 'in these 12 months, we closed on a unique acquisition, adding three nuclear sites, approximately one million additional retail customers in the key PJM market and 2,000 new team members'. The bottom line is that there's a lot of progress being made at the company, aside from the AI-hype and speculation. The share price will likely continue to be volatile. But I think that it will move back higher this year. As the dust settles on some of the AI concerns, people should realise that Vistra is a profitable utility company. Further, it's pushing ahead with renewable energy. Even though this will be attractive for big tech with AI spending plans, it's also appealing to other corporate customers. So even if AI slows down, it can still do very well with other clients. Overall, I think this is a dip opportunity worth considering for investors. In contrast to some other AI-related stocks, Vistra has a strong core utility business, which I think makes it more sustainable going forward. The post This S&P 500 darling is down 25% in the past month! Here's what's going on appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool Jon Smith has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025 Sign in to access your portfolio
