DHUnplugged #692: Froth-A-Bubble

TECH on fire – Bulls overjoyed!
Hedge Funds – Making some moves – Surprising
Year of Pharma?
To The Moon – Crypto Style
Valuations getting frothy?

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Warm Up
- Pays to Follow Pelosi!
- Landing on the Moon - then falling over
- Japan - something not kosher
- New See-through laptop screens

Market Update
- TECH on fire - Bulls overjoyed!
- Hedge Funds - Making some moves - Surprising
- Year of Pharma?
- To The Moon - Crypto Style
- Valuations getting frothy


Froth-a-Bubble- Icous?
- There is some concern at Apollo regarding a bubble in S&P 500
- The top 10 companies in the S&P 500 today are more overvalued than the top 10 companies were during the tech bubble in the mid-1990s, see chart below.
- Different makeup back in 1999 - but still of interest asa the S&P500 reaches levels (P/E) at the high end of the ranges.

Smart Money?
- Hedge funds piled into tech stocks in the weeks before Nvidia Corp. earnings. Now, they’re cashing out and selling at the fastest pace in seven months.
- Professional managers offloaded their positions for four straight sessions last week, including Thursday, the day after Nvidia posted results, according to data from Goldman Sachs Group Inc.’s prime-brokerage unit. The intensity of the selling ranks in the 98th
- he data suggests traders are booking profits on their tech wagers after a six-week buying streak and putting that extra cash into less volatile stocks, such as consumer staples.

- NEWS MONDAY: PANW - Palo Alto Networks shares higher by 9% after Rep. Nancy Pelosi reported Friday afternoon the purchase of 70 call options (purchases made 2/12 and 2/21)
- Stock moved down 27% after earnings last week
- In fairness, the purchases on 2/12 are very underwater
- AH picked this for the game right after post-earnings slump

Earnings - Zoom
- Zoom shares rose as much as 13% in extended trading on Monday after the video chat software vendor announced fiscal fourth-quarter results that topped analysts' expectations.
- Here's how the company did, compared with consensus among analysts polled by LSEG:
- -- - Earnings per share: $1.22, adjusted vs. $1.15 expected
- - - -Revenue: $1.15 billion vs. $1.13 billion expected

-Walt Disneyshareholder Blackwells Capital is calling for it to come up with an artificial intelligence (AI) strategy, saying that this could lift the U.S. media and entertainment conglomerate's stock price by as much as 129%.
Blackwells is one of two activist investors pushing for board seats

What Goes Up...
- Intuitive Machines Inc. shares sink Monday, after the spacecraft company said its lander, which successfully touched down on the moon last week, likely landed on its side.
- The landing was touted as the first by a private-sector company to reach the moon intact, as well as the first US spacecraft to reach the moon’s surface since 1972.
- In a Monday update, the company wrote that “flight controllers intend to collect data until the lander’s solar panels are no longer exposed to light,” and that “based on Earth and Moon positioning, we believe flight controllers will continue to communicate with Odysseus until Tuesday morning.”
- Stock down 33% on this news

- Markets at new highs
- Yen weak weak weak
- Government keeps ultra-loose monetary policy
- Recession official
- Something is not right over there

More Japan
- Federal prosecutors in New York on Wednesday said they had charged a Japanese Yakuza leader with conspiring to traffic nuclear materials from Burma to other countries.
- Prosecutors said the accused gangster Takeshi Ebisawa "and his confederates showed samples of nuclear materials in Thailand" to an undercover agent from the U.S. Drug Enforcement Administration.
- "A U.S. nuclear forensic laboratory later analyzed the samples and confirmed that the samples contain uranium and weapons-grade plutonium," the statement said.

Lenovo See-Through
- Chinese tech giant Lenovo showed off a prototype laptop on Monday that has a see-through screen, underscoring how the world's largest PC maker is trying to innovate after a brutal couple of years for the market.
- Seems like it can be used for VR / AR - Put something behind it (architect designing house can put house behind ?)
- Any thoughts?

Out of Favor - Pharma?
- Pharmaceutical companies last year launched new U.S. drugs at prices 35% higher than in 2022, reflecting in part the industry's embrace of expensive therapies for rare diseases like muscular dystrophy, a Reuters analysis found.
- The median annual list price for a new drug was $300,000 in 2023, according to the Reuters analysis of 47 medicines, up from $222,000 a year earlier. In 2021, the median annual price was $180,000, for the 30 drugs first marketed through mid-July, according to a study published in JAMA.
- Will Pharma be a sector to invest in - especially if AI will help shave costs for industry?? (XLV, XBI, IBB)

Crypto Fever
- Bitcoin hit a two-year high on Tuesday, on track for its biggest two-day rally this year, on signs large players were buying the cryptocurrency, while smaller rival ether topped $3,200 for the first time since 2022.
- Bitcoin has rallied more than 10% in two sessions, helped by Monday's disclosure from crypto investor and software firm MicroStrategy that it had recently purchased about 3,000 bitcoins for an outlay of $155 million.

11 Granolas

- FANG + Mag7 Euope Style
- The momentum of this group — which comprises GSK, Roche, ASML, Nestle, Novartis, Novo Nordisk, L'Oreal, LVMH, AstraZeneca, SAP and Sanofi — has drawn comparisons to the "Magnificent Seven" U.S. tech giants and evoked similar concerns about concentration risks in European equity markets.
- Together, the GRANOLAS account for around a quarter of the total Stoxx 600 market cap, and Goldman analysts in a note last week highlighted that they exhibit qualities that are expected to thrive in the current cycle, such as solid earnings growth, high and stable margins and strong balance sheets.

US Government Shutdown?
- Funding is due to run out on March 1 for some federal agencies, including the Department of Transportation, while others like the Defense Department face a March 8 deadline.
- Special meeting today - "Good Outcome" - (not definitive deal)
- No One Cares Anymore... About any of this...

Beyond Stupid - Look for these words
- Beyond Meat reports Q4 (Dec) results, beats on revs; guides FY24 revs in-line
Beyond Meats - Reports Q4 (Dec) GAAP loss of ($2.40) per share, may not be comparable to the FactSet Consensus of ($0.89); revenues fell 7.8% year/year to $73.68 mln vs the $66.66 mln FactSet Consensus.
- Adjusted EBITDA was a loss of $125.1 million, or -169.9% of net revenues, compared to an Adjusted EBITDA loss of $56.5 million, or -70.7% of net revenues, in the year-ago period.
- Co issues in-line guidance for FY24, sees FY24 revs of $315-345 mln vs. $344.43 mln FactSet Consensus.
- Co added, "Our 2024 plan includes taking steps to steeply reduce operating expense and cash use; pricing actions and the right-sizing of our production footprint, both in support of margin expansion; a years-in-the-making core platform renovation in Beyond IV that delivers superior health benefits and taste; and, following the announcement and initiation of our Global Operations Review, taking certain non-cash charges pertaining to inventory and assets that are no longer consistent with our path to profitability."
- Stock up 80% after hours

- ATT outage last week - cell service down for hours
- some people getting $5 for inconvenience

Reddit IPO
- Never turned a profit since inception
- Social media company Reddit filed its IPO prospectus with the Securities and Exchange Commission on Thursday after a yearslong run-up. The company plans to trade on the New York Stock Exchange under the ticker symbol “RDDT.”
- $10 billion valuation
- Google on Thursday announced an expanded partnership with Reddit that will give the search giant access to the company’s data to, among other uses, train its AI models.

- Google to pause Gemini AI model's image generation of people due to inaccuracies
- Google started offering image generation through its Gemini AI models earlier this month, but over the past few days some users on social media had flagged that the model returns historical images which are sometimes inaccurate.
- Founding fathers were Asian and other...

If AI not bad enough...
- A patient implanted with Neuralink's brain technology can now control a computer mouse just by thinking, the company's founder Elon Musk said.
- "(The) patient seems to have made a full recovery with no ill effects that we are aware of and is able to control the mouse, move the mouse around the screen just by thinking," Musk said in a Spaces session on X.


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