The Insider Report: S&P 500's New Peak and Gold's Record Rally

Your Exclusive Benzinga Insider Report

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By analyst Gianni Di Poce
Volume 4.04

Market Overview (Member Only)

• Stocks continued their rally last week, with the Dow Jones Industrial Average leading the way by closing up 2.15%. But it was only the S&P 500 that hit a new all-time high, closing up 1.74%. The Nasdaq was up a cool 1.65% too.
  
• Get ready for an action-packed week filled with central bank rate decisions, key economic data, and earnings.
  
• Gold just closed at its highest level in history, as tech looks to make a comeback along with the Chinese equity market.
  
• We'll have our answer for January's performance at the end of this week, and as the saying goes, "As goes January, as goes the year."

Stocks I Like

Oklo Inc. OKLO (+50% Return Potential)

What's Happening

• Oklo Inc. (OKLO) is an innovative energy company focused on developing compact nuclear reactors to provide clean, reliable, and sustainable power solutions, primarily in the U.S.
  
• In the past year, OKLO didn't have any revenue and lost around $9.96 million.
  
• This makes valuation a bit tricky on this stock. But if we're basing it on Book Value, which is at 1.92, it's pretty expensive as it is.
  
• From a technical standpoint, OKLO is starting to emerge from an ascending triangle formation, which could lead to a continuation of the bull trend.

Why It's Happening

• Oklo recently formed a strategic relationship with Switch to deploy 12 gigawatts of advanced nuclear power. This massive deal represents one of the largest corporate clean power agreements in history. As Oklo begins to fulfill this order, it will significantly boost the company’s revenue and market position, potentially driving the stock price higher.
  
• Oklo has signed a memorandum of understanding with RPower to deploy a phased power model for data centers. This collaboration combines RPower’s immediate energy deployment capabilities with Oklo’s clean energy solutions, addressing both short-term and long-term energy challenges. This partnership opens up a lucrative market segment and positions Oklo for significant growth in the data center industry.
  
• CEO Jacob DeWitte revealed that Oklo currently has an order book of 14 gigawatts of energy. This substantial backlog not only ensures steady future revenue streams but also validates the market demand for Oklo’s advanced nuclear solutions. As the company works through this order book, we can expect sustained growth and increased investor interest.
  
• Citigroup recently raised its price target for Oklo from $10.00 to $31.00, maintaining a “neutral” rating. Additionally, Wedbush initiated coverage with an “outperform” rating and a $26.00 price target. These positive analyst views suggest further upside potential for the stock and increased institutional interest.
  
• The company’s new phased power model offers a unique solution for data centers, transitioning from natural gas to clean nuclear energy over time6. This approach provides immediate power availability while building a clear path to sustainable operations. As more data centers adopt this model, Oklo’s revenue and market share are likely to expand rapidly.
  
• Several institutional investors have recently added to or reduced their stakes in Oklo, with overall institutional ownership now at 85.03%. This high level of institutional interest provides validation for Oklo’s business model and growth prospects, potentially leading to increased stability and long-term price appreciation. 

Analyst Ratings:

• Citigroup: Neutral
• Wedbush: Outperform
• B. Riley Securities: Buy

My Action Plan (50% Return Potential)

• I am bullish on OKLO above $31.00-$32.00. My upside target is $60.00-$61.00.

Spire Global SPIR (+38% Return Potential)

What's Happening

• Spire Global, Inc. (SPIR) is a leading provider of satellite-powered data and analytics services, offering real-time information to industries such as agriculture, maritime, and energy, to support decision-making and operational efficiency.
  
• The company brought in $27.73 million in revenue over the past year, but still lost $12.22 million overall.
  
• SPIR has an elevated valuation with its Price-to-Sales at 3.43 and its Book Value at 3.51.
  
• From a technical perspective, SPIR just broke out form a cup and handle formation. This a big momentum pattern and can lead to a lot more upside in the near-term.

Why It's Happening

• Spire Global reported its highest quarterly bookings of $40.0 million in Q3 2024, showcasing robust demand for its services. This record-breaking performance suggests that Spire’s solutions are gaining traction in the market. As the company continues to innovate and expand its offerings, this trend of strong bookings could translate into sustained revenue growth and improved financial performance in the near future.
  
• The recent NASA contract awarded to Spire Global and OroraTech for developing space-based wildfire early detection capabilities demonstrates the company’s innovative edge. With plans to launch eight wildfire-detecting satellites by 2025, Spire is positioning itself at the forefront of addressing critical environmental challenges.
  
• The recent agreement to sell Spire’s maritime business for $241 million is a game-changer for the company’s financial health. This move will allow Spire to retire all outstanding debt, significantly improving its balance sheet. 
  
• Multi-Million Dollar Government Contracts Bolster Revenue Streams
  
• The securing of contracts worth $14 million from the U.S. Air Force, £3.5 million from the UK Space Agency, and a $6.7 million renewal from NASA highlights Spire’s strong position in the government sector. These contracts not only provide stable revenue streams but also validate Spire’s capabilities in critical areas such as national security and climate research.
  
• With a consensus “Strong Buy” rating from 6 analysts and a 12-month price target of $19.2, representing a 6.79% upside from current levels, market experts are bullish on Spire’s prospects. 
  
• Spire’s diverse portfolio of solutions, including Maritime, Aviation, Weather, and Space Services, positions the company to address a wide range of global challenges. By leveraging its space-based data and analytics capabilities across multiple sectors, Spire is tapping into large and growing markets.

Analyst Ratings:

• Canaccord: Buy
• Craig-Hallum: Buy
• Baird: Neutral

My Action Plan (38% Return Potential)

• I am bullish on SPIR above $15.50-$16.00. My upside target is $26.00-$27.00.

Sportradar Group SRAD (+35% Return Potential)

What's Happening

• Sportradar Group (SRAD) is a global leader in providing sports data and technology solutions, offering real-time statistics, analytics, and content to sports organizations, media companies, and betting operators worldwide.
  
• SRAD had $255.17 million in revenue in the past year, while its earnings came in at $37.26 million.
  
• The valuation in SRAD is very steep. Its P/E is at 148.76, its Price-to-Sales is at 4.28, and its EV to EBITDA is at 13.04. There are high hopes for this stock and I think
  
• From a charting standpoint, SRAD recently broke out from a bull flag pattern, which is one of the most powerful in all of technical analysis. Look for momentum to keep accelerating to the upside.

Why It's Happening

• Sportradar secured a multiyear agreement with Major League Baseball to offer unparalleled sports performance analysis of amateur baseball prospects. This partnership opens up new revenue opportunities in player scouting and talent evaluation, diversifying Sportradar’s service offerings.
  
• In October 2024, Sportradar enhanced its partnership with the NBA by introducing a suite of innovative fan engagement solutions. This deepened relationship with a major sports league could lead to increased revenue streams and solidify Sportradar’s position as a leader in sports technology.
  
• Data from MAPsignals indicates significant optimism from institutional investors, with unusually high trading volumes pointing to robust demand for SRAD shares. This institutional confidence often precedes long-term stock appreciation and validates the company’s strong market position.
  
• Sportradar experienced a staggering 46% year-over-year growth in the U.S. market, now accounting for 20% of its overall revenue. This rapid expansion in the lucrative U.S. sports betting market suggests enormous potential for future growth and market dominance.
  
• Sportradar’s Q3 2024 earnings report showed a remarkable 27% jump in revenue. This substantial increase demonstrates the company’s ability to capitalize on the growing sports betting and entertainment market, positioning it for continued financial success.
  
• The company’s betting technology and solutions revenue surged by 32% year-over-year, reaching $210 million.

Analyst Ratings:

• Jeffries: Buy
• JMP Securities: Market Outperform
• Citigroup: Buy

My Action Plan (35% Return Potential)

• I am bullish on SRAD above $17.00-$18.00. My upside target is $28.00-$29.00.

Market-Moving Catalysts for the Week Ahead

A Week Filled with Headline Risk… or Opportunity?
It's been an unusual start to the year in the sense that we're only beginning the second full week of trading in 2025. But make no mistake – we jumping head first into an action-packed week that takes us to the end of January.

We have FOMC rate decisions, a Fed press conference, inflation data, GDP numbers, and on top of it all, a flurry of earnings reports this week. Not to mention, we're still grappling with new executive orders coming out of the Trump administration.

During weeks like this, it's absolutely critical to stay true to your trading and risk management strategies. The trend in stocks is solidly up, and if anything, temporary drawdowns are a dip-buying opportunity. There's still room to run to the upside, so don't miss the forest for the trees.

A New-New World Order?
Believe it or not, the World Economic Forum at Davos took place last week. But it seems like this event was eclipsed by economic and political developments taking place in the United States. For many years, we heard the phrase, "New World Order," but it sure seems like another one is coming upon us from an entirely new direction.

I wouldn't be surprised to see a complete realignment of the power blocks in Europe especially. I think this makes the Euro particularly vulnerable to sustained weakness against the Dollar in the long-run, even though we'll probably see the Dollar come back down in the near-term.

This creates a goldilocks scenario for the coming months – if inflation is contained, energy prices are down, and interest rates drop, I would look for stocks to further compound their impressive gains from the past couple of years. And it's unlikely to just be in the U.S. either – more on this below.

Sector & Industry Strength (Member Only)

We're now heading into the final week of January, and from a sector performance ranking standpoint, it could hardly be any better for bulls. But if it were to get better, I would just want to see technology (Ticker: XLK) start climbing the ranks, and I think it's within the realm of possibility.

Remember, it bull markets, growth-oriented sectors lead, while defensive-oriented sectors lag. And that's exactly what we continue to see. With healthcare (Ticker: XLV), energy (Ticker: XLE), and consumer staples (Ticker: XLP) all at the bottom of the pack, the path of least resistance for stocks looks to be higher.

Plus, when you're in a tape where consumer discretionary (Ticker: XLY) is the top-performing sector, it sends a very clear signal that the market has confidence in the consumer. And remember, we're in a consumption-dominated economy. It's a bull market.

1 week	3 Weeks	13 Weeks	26 Weeks
Communications	Industrials	Consumer Discretionary	Consumer Discretionary

Editor's Note: Communications and industrials claiming leadership spots is hardly a bearish development.

Can 2025 Be the Year for a Chinese Comeback? – Sector ETF: FXI SPY 
Even though the recent economic developments in the U.S. are attracting the most media attention, it's so important to remember that we are trading a global market. This is why I want to bring your attention to what's happening in the Chinese equity market.

We're looking at the ratio between large-cap Chinese stocks (FXI) compared to U.S. stocks (SPY). For the past several years, and even longer actually, SPY has outperformed FXI by a significant margin. Hence, the downtrend in this ratio.

But we've seen a break of the downward sloping trendline, which indicates the slope of the decline is violated. We may even have our first case of a higher-high, and if the ratio turns back higher soon, a higher-low. This means that we should be prepared for a scenario where FXI outperforms SPY in 2025.

Chips Signaling Tech Strength – Sector ETF: SMH 
There are absolutely huge developments taking space within the tech sector right now. The ramifications for this cannot be understated since technology represents the largest and most important sector in the S&P 500.

But to gauge exactly what is transpiring there, we've been using the ratio between semiconductors (SMH) and the Nasdaq 100 (QQQ). Simply put, when chips outperform the top-100 stocks in the Nasdaq, it's a very bullish signal.

The ratio has been favoring SMH with the uptrend, as seen by higher-highs and higher-lows. Now it's trying to breakout from a falling wedge formation, and if successful, we should see new highs in the ratio as semiconductors look to power stocks to new all-time highs.

What Do Bonds Think of Inflation? – Sector ETF: TIP 
I still think we're in a market environment where we are living or dying by inflation. Stated differently, if we see a meaningful spike in inflation, it would place tremendous pressure on stocks and open the door for more downside.

This makes it a perfect time to check back in on the ratio between Treasury Inflation Protected Securities (TIP) and 7-10 Year Treasuries (IEF). As a quick reminder, when TIP outperforms IEF and the ratio rises, it signals that bonds think inflation is a problem. But when the ratio drops and IEF outperforms TIP, it signals that inflationary pressures are contained.

To say that this ratio is at a pivotal juncture is an understatement. It looks like a breakout from a descending triangle formation took place back in September, which is a continuation pattern. The rise even took out the high from April 2024.

Editor's Take:
The big question now is whether we could be forming a lower-high compared to the April 2022 peak. In fact, I would argue that stock market bulls need this to happen in order for markets to remain calm in 2025.

I think the new administration's policy of "drill baby, drill," will help keep inflationary pressures contained. And if we do in fact see a drop in energy prices, it will probably help bring this ratio downward.

If, instead, we see this ratio continue to climb higher, then it's going to damper the prospects of rate cuts in 2025. Right now, the market is banking on liquidity conditions improving this year, but inflation could be the spoiler on that front.

Cryptocurrency
XRP has captured a lot of attention this week as it consolidates into a textbook bullish flag pattern following its explosive move from the $2.40 level to recent highs around $3.40. This consolidation pattern typically represents a brief pause in the broader uptrend as the market digests recent gains. 

The measured move from this bullish flag pattern suggests potential targets extending toward the $4.00-4.20 range if the breakout materializes. The steep rally from November has established a clear uptrend, and this flag pattern could be providing an ideal entry point for those who missed the initial move.

However, a break below the lower trendline of the flag (around $2.90) would warrant caution and suggest a deeper retracement might be in store. For now, the technical structure remains firmly bullish as long as price continues to respect the flag’s parameters.

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