CSSE Stock Alert: Chicken Soup for the Soul on the Brink of Death After Bankruptcy Filing

InvestorPlace

Chicken Soup for the Soul Entertainment

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Chicken Soup for the Soul Entertainment, Inc. 9.50% Notes due 2025

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Chicken Soup for the Soul Entertainment, Inc. Series A Cumulative Redeemable Perpetual Preferred Stock

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Netflix

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Another once-prominent company may soon be obsolete. Chicken Soup for the Soup Entertainment has officially filed for Chapter 11 bankruptcy protection as of yesterday, July 1. The entertainment company, named for the iconic book, had branched into areas beyond self-help, including owning DVD rental service Redbox. But after an extremely difficult trading year, CSSE stock has bled out almost all its value, falling more than 90%. Now, its race to the bottom is accelerating, as the company’s financial struggles have reached a breaking point, and there seem to be no other options available.

Does the bankruptcy filing mean that CSSE stock will soon cease to exist? Let’s take a closer look at this troubled company and assess what investors should be expecting in the near future.

What’s Happening With CSSE Stock

Granted, at 11 cents per share, CSSE stock doesn’t have much further to fall. But trading has been highly volatile today, with shares mostly trending downward as the market reacts to the bankruptcy protection filing. As of this writing, shares are down 3% for the day, and the stock looks poised to continue trending downward as further negative sentiment sets in.

There’s no denying that things look extremely bleak for this troubled company. According to The Wall Street Journal, Chicken Soup for the Soul Entertainment boasted a debt load of nearly $1 billion and that a group of lenders proved “unwilling to consent to potential refinancings.” When the company acquired Redbox in 2022, its debt burden increased by $360 million. But after the deal closed, things went from bad to worse as CSSE stock began to fall at a time when share prices were already low.

Redbox is a relic of a former era. The company, founded in 2002, gained a national presence at a time when Netflix’s business model centered around shipping DVDs by mail. However, the physical DVD rental market hasn’t aged well, as its owner knows all too well. As the Los Angeles Times reports:

“While Netflix disrupted the film and television business by bringing streaming to the masses, Redbox struggled to pivot, despite various attempts to capture a more digitally savvy audience as the DVD business collapsed. By 2017, the U.S. market for cheap rentals from kiosks had collapsed to $1.27 billion in consumer spending, down by about a third compared with five years earlier, according to data from Digital Entertainment Group.”

Now Chicken Soup of the Soul’s decision to buy the company may be its downfall. Its long list of creditors includes Warner Bros. Home Entertainment and Sony Pictures as well as retail chains such as Walmart , which host Redbox kiosks.

Why It Matters

It isn’t surprising that Chicken Soup for the Soul Entertainment would be on its way out after the type of year it’s had. Despite a meme stock surge in April 2024 that ended as quickly as it began, CSSE stock has seen no real momentum and has only inched toward the bottom.

Now, it seems that its gradual decline has finally picked up speed, as the company is out of options. For a company that built its brand around helping heal groups of people, CSSE hasn’t been able to heal its own business model.

On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.

On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.

Samuel O’Brient is a Reporter for InvestorPlace, where his work focuses primarily on financial markets, global economic trends, and public policy. O’Brient writes a weekly column on recent political news that investors should be following.

Netflix Is Maintained at Buy by Argus Research

Dow Jones Newswires

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Risk Warnings and Disclaimers

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Nikola 2Q Sales Beat Management Expectations

Dow Jones Newswires

By Sabela Ojea

Nikola said it has exceeded its sales guidance for the second quarter after securing higher-than-expected hydrogen fuel cell trucks in the period.

The electric-vehicle maker on Tuesday said that it wholesaled 72 class 8 Nikola fuel cell trucks in the second quarter, above the high end of truck sales guidance of 60 units.

Overall for the first half of the year, Nikola wholesaled 112 hydrogen fuel cell trucks.

"We have maintained our 2024 momentum with solid wholesale numbers, new customers such as Walmart Canada, and repeat customers like 4GEN and IMC, purchasing vehicles through our dealer network," Chief Executive Steve Girsky said.

Write to Sabela Ojea at sabela.ojea@wsj.com; @sabelaojeaguix

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Netflix Inc : Argus Raises Target Price To $767 From $660

Reuters

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Today’s Biggest Pre-Market Stock Movers: 10 Top Gainers and Losers on Tuesday

InvestorPlace

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Pre-market stock movers are worth diving into this morning as we break down all of the biggest news sending shares higher and lower on Tuesday!

Moving stocks this morning are a bankruptcy filing, earnings reports, new deals and more.

Let’s get into that news below!

Biggest Pre-Market Stock Movers: 10 Top Gainers

Chicken Soup for the Soul Entertainment stock is rocketing more than 222% after falling yesterday on a bankruptcy filing.
Chicken Soup for the Soul Entertainment, Inc. – 9.50% Notes due 2025 are soaring close to 82% after yesterday’s drop.
Roadzen shares are surging over 60% alongside its first public year-end earnings.
IMAC stock is gaining more than 37% without any clear news this morning.
Versus Systems shares are rising over 31% after naming an interim CEO.
Zapp Electric Vehicles Z stock is increasing 30% despite a lack of news this morning.
Chicken Soup for the Soul shares are climbing more than 19% with its bankruptcy filing.
Ocean Power Technologies stock is heading over 16% higher alongside heavy pre-market trading.
US Energy shares are jumping more than 14% on a new acquisition deal.
VS Media V stock is up over 14% this morning.

10 Top Losers

Conn’s stock is plummeting nearly 35% despite a lack of news this morning.
Nukkleus shares are diving almost 15% without any apparent news today.
Applied DNA Sciences stock is tumbling close to 12% without any news to note.
Senti Biosciences shares are taking a more than 11% beating after a cancer funding rally yesterday.
Datasea stock is sliding close to 11% after rallying yesterday on sales agreements.
Presto Automation shares are falling over 10% despite a lack of news this morning.
SAI.TECH Global stock is decreasing more than 10% without any news to report.
Hudson Pacific Properties shares are dropping over 10% despite a lack of relevant news today.
Vintage Wine Estates stock is slipping more than 10% this morning.
Akso Health shares close out our pre-market stock movers down over 10% today.

On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Amazon’s $2 Trillion Milestone: Why AMZN Stock Could Surge Another 20%

InvestorPlace

Amazon stock is now worth over $2 trillion, but companies worth buying into never rest on their laurels. Once a milestone is reached, the great ones seek a new one.

While Amazon was struggling toward its latest milestone, remember, Nvidia blew past it. It’s now just the fourth most-valuable company in the market.

It’s also getting cheaper. Shares now trade at 3.3 times sales and 53 times earnings. When it passed $1 trillion, in 2018, it was more expensive by these measures.

But a simple Strengths, Weaknesses, Opportunities and Threats analysis is almost impossible. There are too many moving pieces. You must look at each one individually.

AWS and AMZN Stock

Amazon Web Services, the Amazon Cloud, is its Atlanta. It influences everything. AWS is now a $100 billion business, but it’s being pressed hard by Microsoft .

That’s why Adam Selipsky was replaced as AWS President last month with Matt Garman. Garman immediately showed off a new set of lieutenants aimed at improving customer relations, and doubled incentives for startups to build AI on AWS.

Going forward, it’s all about operations. How AWS will deal with the energy requirementsof Nvidia chips is important. But so is Amazon silicon, which can take some of the load off those chips and keep costs low.

Software is also key. Amazon Bedrock is the new service that will be streaming Generative AI applications. Amazon put $4 billion into Anthropic, to use its large language models. The latest model is already online.

Then there’s Alexa. Chatbots are suddenly sexy, with Apple moving to make Siri the glue holding its own AI play together. Despite selling over 500 millionAlexa devices, the service is now a laggard.

Changing that may mean charging for it, as much as $10 per month. Making the expense worth it is vital, but Alexa has gotten too big to kill.

Health and The Store

Amazon still gets the bulk of its operating cash flow from its store, a virtual Walmart with scaled operations to match.

Amazon is now preparing for its July 16 “Prime Day”event, a summer sale that in previous years was heavy with electronics.

All is not well on the merchandising side. Temu and Shein are pressing it in fast fashion as hard as Microsoft is in cloud services. The response is to ship Chinese-made fashion goods more directly, bypassing the normal warehouse distribution system.

While Amazon is on defense when it comes to clothes, it’s on offense when it comes to health. The collapse of Walgreens represents an opportunity, as do growing “health deserts.”

The answer is to rebrand the Amazon Clinic online service as One Medical, offering $49 per visit telehealth appointments or a subscription plan at $199/year, half that for Prime members.

Amazon bought One Medical last year for $3.9 billion and brought in Trent Green from Legacy Health, a hospital system in the Pacific Northwest, to run it.

All this is on top of Amazon Pharmacy, now pitched as a portal for managing chronic conditions that take up 75% of Americans’ health bills.

The Bottom Line

Analysts who do SWOT analyses see Amazon earning $4.24 per share this year on sales of $596 billion.Amazon next reports July 24 and makes a habit out of beating estimates. The latest one-year price target from Wells Fargo is $239, a 20% gain.

AMZN stock bulls must remember that value is vulnerable. In tech’s last bear market, just two years ago, Amazon lost $1 trillion in value. But it has since gained all that back, and more.

Amazon is a stock you own, not one you trade.

As of this writing, Dana Blankenhorn had a LONG position in MSFT, AMZN, NVDA and AAPL. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Dana Blankenhorn has been a financial and technology journalist since 1978. He is the author of Technology’s Big Bang: Yesterday, Today and Tomorrow with Moore’s Law, available at the Amazon Kindle store. Tweet him at @danablankenhorn, connect with him on Mastodon or subscribe to his Substack.

5 Biggest Winners, 5 Biggest Losers From Dow Jones Industrial Average In First Half 2024

Benzinga

Broad stock market indexes like the S&P 500 hit all-time highs in the first half of 2024.

The Dow Jones Industrial Average also hit all-time highs, but saw a smaller return in the first half of the year. Here's a look at the biggest gainers and laggards in the Dow Jones Industrial Average.

What Happened: The Dow Jones Industrial Average was created in 1896 by Charles Dow and is one of the oldest and most followed equity indexes for overall stock market health. The Dow Jones Industrial Average hit all-time highs of more than 40,000 in May 2024.

The Dow Jones Industrial Average consists of 30 stocks on a price-weighted basis. The Dow Jones Industrial Average ETF , which tracks the index, is one of the most invested and followed ETFs.

In the first half of 2024, 18 of the Dow Jones components stocks were up, with 12 stocks declining for the first half of the year.

The top five gainers for the first half of 2024 were:

Walmart Inc : +28.9%
Amazon.com Inc : +27.2%
American Express Company : +23.6%
Microsoft Corp : +18.9%
JPMorgan Chase & Co : +18.9%

The top five losers for the full year were:

Intel Corporation : -38.4%
Nike Inc : -30.6%
Boeing Co : -30.2%
McDonald's Corporation : -14.1%
Johnson & Johnson : -6.8%

Read Also: Walgreens Faces Nasdaq 100 Ouster Amid Financial Woes; Super Micro Computer Eyed As Replacement: Report

Why It's Important: Ten of the Dow Jones Industrial Average stocks were up double-digit percentage in the first half of the year.

Goldman Sachs Group Inc , Merck & Co Inc , Walt Disney Co , Procter & Gamble Co and Caterpillar Inc were also each up double digits to start the year.

Microsoft ended 2023 as the third-best-performing Dow Jones stock and is continuing 2024 where it left off.

Intel ranked as one of the top performers in 2023, but has fallen in 2024. The stock is mentioned by several experts as a potential stock to be removed to make way for semiconductor leader NVIDIA Corporation .

The Dow Jones Industrial Average gained a total of over 14% for 2023. The index is up 3.8% year-to-date in 2024.

While the gains are positive in both 2023 and the first half of 2024, the index is lagging behind other major stock market indexes like the S&P 500. The S&P 500 was up 24.2% in 2023 and is up 14.5% to start 2024.

The performance of the Dow Jones Industrial Average has also been overshadowed by the performance of the Magnificent 7 stocks in 2023 and the first half of 2024.

The Mag 7 consists of Alphabet Inc , Amazon.com, Apple, Meta Platforms Inc , Microsoft, Nvidia and Tesla Inc .

The Roundhill Magnificent Seven ETF , which tracks the stocks, was up over 32% in the first half of 2024, outperforming both the Dow Jones Industrial Average and S&P 500.

The Dow Jones Industrial Average and other stock market indexes could be closely monitoring the 2024 presidential election, which could see the new year bring gains as in past years. The Dow Jones Industrial Average was up 7.3% in 2020, 13.4% in 2016 and 7.3% in 2012, the three most recent presidential election years. The average return of the index is +5.4% over the past 16 presidential election years.

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