EDITOR'S NOTE
Stocks had a calmer day on Wednesday, as the market caught its breath from last week's short-squeeze drama. The S&P 500 eked out a slight gain, posting a three-day winning streak.
Alphabet popped by more than 7%, following yesterday's fourth-quarter earnings beat. Certain popular short-squeeze stocks, beloved by the Reddit community, climbed modestly.  GameStop, which announced it would add Matt Francis as its new chief technology officer, enjoyed a 2.7% boost to its share price. Nevertheless, the stock's value fell below $100.
GameStop's rapidly changing fortunes raise an interesting question: At what point might the company's share price accurately reflect its value?
According to Aswath Damodaran, finance professor at New York University, the magic number is $30 per share. "So my estimate of value, my base estimate, is about $30 [per share], but I could see why you could get to $50, maybe $60 with a plausible story," he said on CNBC's "Squawk Alley."
Speaking of risky plays, investors hoping to generate income from bond-heavy allocations may need to embrace some risk to accomplish their goals.
That's what Margie Patel, portfolio manager of the Wells Fargo Diversified Capital Builder Fund (EKBYX), said in a special CNBC PRO Talks. Equities and high-yield bonds might help here.
"I think people really have to rethink their approach to risk-free investments and how much income they are willing to give up in order to be risk free," she said. "The zero interest rate policy that the Fed is pursuing is putting a real penalty on conservative savers and that's the reality." TOP NEWS
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Rabu, 03 Februari 2021
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