Wall Street's Island of Misfit Toys: From Quantum Illusions to Drone Gambles

I look at a lot of bizarre market groupings, but this basket of uncategorized US equities is truly something else. It's Wall Street's island of misfit toys—a chaotic mix of infrastructure giants, questionable tech pivots, and one literal dead entity. This is stupid and here's why: you can't just throw them all in one bucket. But since we are here, let's separate the actual businesses from the hype.

Let's start with the one that is literally dead. Global X MSCI China Energy ETF (CIEG.US) has been delisted. Good luck with that if you were still holding it. It's a historical artifact now.

Then we have the tech buzzword bingo players. Arqit Quantum (ARQQ.US) just settled a USD 7 million class-action lawsuit over misleading revenue statements. They are showing off quantum-safe tech with satellites, but insiders sold over USD 2.2 million in stock recently while buying exactly zero. Why aren't you moving faster to the exits? Lumen Technologies (LUMN.US) is desperately trying to pivot from legacy copper to a multi-cloud gateway fiber player. They just expanded to over 10 million US commercial locations, but I've seen this "telco turnaround" movie before.

Swarmer (SWMR.US) is taking a massive gamble, buying Ukrainian ground drone maker Ratel Robotics for up to USD 224 million. Ratel has real defense contracts, but integrating a war-zone startup is not for the faint of heart. Meanwhile, Sierra Wireless (OUST.US), which was swallowed by Semtech, is still trying to make IoT happen across industrial sectors.

In the semiconductor space, Ichor Holdings (ICHR.US) recently saw its stock tank after announcing a USD 200 million equity offering. Dilution is always a great way to anger shareholders, even if the stock had surged over 40% in the past month. Photronics (PLAB.US) isn't doing much better—shares have slumped nearly 10% over the last month amidst class-action rumblings, despite receiving advanced mask-writing equipment for AMOLEDs.

Finally, the old-school businesses doing the actual heavy lifting. Quanta Services (PWR.US) is the adult in the room, riding the aging grid and renewable energy wave. The stock is up nearly 50% this year, and Piper Sandler just upgraded them to a strong buy. Arch Capital Group (ACGL.US) keeps quietly printing money in Bermuda reinsurance. And Upbound Group (UPB.US)? Their Rent-A-Center business is a high-dividend trap yielding over 8%. If Acima's volume doesn't recover, the cash flow dynamics will get ugly.

My view? Stick to the companies building actual infrastructure, and leave the quantum illusions to the gamblers.

This article does not constitute investment advice.