The Sweatpants of Wall Street? | The Daily Peel | 7/26/21


Market Snapshot


What's Ripe

Snap Inc. ($SNAP) – Snap founder Evan Spiegel never intended to replace the phrase "What's your number?" with "What's your snap?" but it turns out to be working just fine for them. SNAP closed at a record high of $77.97 on Friday as earnings boosted shares by 23.8%. Who knew that making AR filters which give people dog faces and disturbingly shaped heads could drive over $900mm in revenue? One thing we do know - Zuck is shook.

Facebook ($FB) – Well, okay, maybe Zuck isn't that shook. Facebook jolted up 5.3% on Friday, reaching an ATH and leaping over the $1tn mark yet again. Facebook can thank Snap and Twitter for Friday's gains, as the other social networking platforms earnings showed strong digital ad spend throughout 2021. In turn, Facebook reaped the benefits of investor interest. Alongside Friday's increase, fellow giant, Google, jumped 3.6% on the day because it's good to be a tech monopoly.

Roku ($ROKU) – An OG of streaming and a digital advertising beast, it seems like Roku is often undeservedly forgotten about. We don't let that happen at The Peel, and with Friday's 12.6% it'd be pretty hard to miss. Getting a streaming deal with NBC for the Olympics was a big win for the company, and investors drooled at the sight of 73% revenue growth projections for the ongoing quarter.


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What's Rotten

Boston Beer Company ($SAM) – Everybody loves beer, beer never dies, and despite what you may have been drunkenly screamed at over last summer, seltzers evidently can't replace beer. Boston Beer Company demonstrated this fact last week as the company plummeted 26% on a lousy earnings release detailing the massive drop-off in demand for their seltzer brand, Truly. While the Truly brand isn't the only driver of the 28% EPS shortfall, it is certainly the largest. CEO David Burwick commented that their prior forecasts make them look "not very smart." No kidding Sherlock.

DiDi ($DIDI) – The march to the grave continues for Didi, and we can't just sit around and pretend like it didn't fall another 21% on Friday. You guessed it, the Chinese government is still very displeased by the actions of the firm, and has thrown just about every single justice and investigative agency in China against them. To put this in perspective, imagine if the U.S. were to ban Uber downloads and unleashed the CIA, FBI, and CISA on them. That would not be a great PR look...

Intel Corp. ($INTC) – It's great to be able to excite investors on your earnings call. Unfortunately, Intel did the exact opposite of that on Friday, leading to a drop of 5.3%. The firm projected supply shortages to persist for "several quarters" and "lower [client computing group] revenue". With that fall, Intel has shed nearly a quarter of its value since early April.


Macro Monkey Says

Homes – White hot housing demand keeps getting hotter. June set a fresh record high for median sale price of existing homes, showing demand has not slowed down from the continually rising prices. The combination of lockdowns making homes more desirable, the increase in wealth across asset classes, and the treasury sending checks to everyone, we can't be too surprised at this perfect storm. The situation continues to get further out of hand as firms like Blackrock buy up houses in the hundreds. Shoutout to all our recent home buyers out there, it must be nice not being completely broke.


Food for Thought:

Buybacks – Like the athleisure trend has done for sweatpants, Wall Street has decided buybacks are cool again. Announcements of share repurchases in 2021 have already surpassed that of 2020, and we are on pace to set a new record high on a rolling-12 month basis. $431bn in repurchases have already been announced, and the same report calls for expectations of roughly $875bn more over the next year. In case investors weren't satisfied enough with 2020 returns, hopefully these unprecedented repurchasing levels will be enough to please.


Meme Meditation


Wise Investor Says

"The biggest risk of all is not taking one"

 Mellody Hobson


Happy Investing,

Patrick & The Daily Peel Team

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