🍋 Big Tech Down Big

Amazon set the record as the first company in history to wipe $1 trillion off its valuation. Amazon saw double-digit revenue growth during 2020 and 2021, but the company couldn't sustain that pace forever.

November 10, 2022

Together With

"Wealth is a vaccine, not a performance-enhancing drug. It can prevent some misery, but it doesn't deliver added happiness." — Derek Thompson

Good Morning! Not for FTX though, as Sam Bankman-Fried warned of bankruptcy for the firm without a bailout (of a measly $8 billion), after Binance walked away from their takeover deal. Some VC investors (Sequoia Capital) marked down their investment in FTX to a grand total of $0. SBF lost 94% of his net worth on Tuesday (single biggest recorded drop in history) and that number could very well be 100% by the end of the week.

Investors also worry FTX contagion could spread throughout both the crypto and stock markets. Meanwhile, control of Congress is still contested, and the post-election stock rally is nowhere to be found.

A record 80 Goldman employees made partner this year up from 60 in 2020.

Today's Short Squeez is brought to you by Daloopa

Part of being a finance professional consists of being one of the world's best-paid data-entry professionals.

It's a pain—and a rite of passage—to build a financial model by painstakingly transcribing information from 10-Qs, 10-Ks, presentations, and transcripts. Or, at least, it was: Daloopa uses machine learning and human validation to automatically parse financial statements and other disclosures, creating a continuously-updated, detailed, and accurate model.

Thomas Li (CEO) puts it best: "Daloopa collects literally everything a company discloses."

Starbucks stock is up ~8% since reporting earnings last week, as customers spend more on pricey drinks. Its one of the few stocks that's (slightly) outperformed the market this year.

If you are interested in modeling out where Starbucks goes from here, Daloopa is giving away Starbuck's detailed financial model to Short Squeez readers.

1. Story of the Day: Big Tech Down Big

2022 has been a rough year for everyone's portfolio. But Amazon set the record yesterday as the first company in history to wipe $1 trillion off its valuation.

Amazon hit a peak $1.88 trillion market cap valuation in July 2021, but the company is only worth $878 billion as of yesterday's close.

Amazon missed earnings expectations for Q3. But its stock dropped even more after the company warned businesses and customers are cutting down on spending.

Amazon led the pandemic e-commerce boom. The company saw its profits triple and its stock price double in the year following the pandemic. Amazon saw double-digit revenue growth during 2020 and 2021, but the company couldn't sustain that pace forever.

The company projects 2-8% growth in Q4. Most companies would be more than happy with that growth, especially this year. But Amazon investors are used to much larger growth and might have to readjust expectations.

Takeaway: It's been a rough year for tech stocks like Amazon. The top five most valuable American tech companies have lost a combined $4 trillion in valuation this year. That's more than the combined entire GDPs of Argentina, Turkey, and Switzerland. Amazon's woes are especially concerning because its reports of slowing consumer and business spending could point to more trouble ahead for the economy at large.

2. Markets Rundown

If you want access to Wall Street insider interviews, industry deep-dives, and investment ideas, check out our Insiders newsletter.

Stocks fell after inconclusive midterm data and crypto concerns.

Movers & Shakers

  • (+) Meta ($META) +5% because the company started laying off 11k workers to cut costs.

  • (+) Kroger ($KR) +2% ahead of its planned merger with Albertsons.

  • (–) Disney ($DIS) -13% after streaming losses caught up to the company.

Private Dealmaking

  • Zenas Biopharma, a developer of autoimmune disease treatments, raised $118 million

  • Agriconomie, a French sustainable agriculture platform, raised $60 million

  • Laika, an automated security compliance platform, raised $50 million

  • Eliyan, a chip manufacturing startup, raised $40 million

  • Voya Financial bought Benefitfocus, an employee wellbeing platform, for $570 million

  • KKR invested $400 million in decarbonization platform Serentica Renewables

3. Top Reads

  • Tech geniuses aren’t always geniuses (Axios)

  • Meta laying off more than 11,000 employees: read Zuck’s letter announcing cuts (CNBC)

  • Did stocks get their most bullish indicator in weeks? (YF)

  • The top 10 fastest-growing U.S. cities this year (CNBC)

  • Credit Suisse will raise $5 billion from two new debt issues (Reuters)

  • This chart shows the stock market’s next problem (YF)

  • The ultimate guide to prioritization (AJ)

  • Tesla loses valuation race to Berkshire as growth stocks sputter (YF)

  • Markets are in trouble, and election results won’t change that (CNN)

  • Zuckerberg didn’t move fast, still broke things (WSJ)

  • Private equity firm TPG reports 60% drop in earnings as asset sales plummet (Reuters)

4. Book of the Day: Thinking 101

Psychologist Woo-kyoung Ahn devised a course at Yale called “Thinking” to help students examine the biases that cause so many problems in their daily lives.

It quickly became one of the university’s most popular courses.

In Ahn’s class, students examine “thinking problems”―like confirmation bias, causal attribution, and delayed gratification―and how they contribute to our most pressing societal issues and inequities.

Now, for the first time, Ahn presents key insights from her years of teaching and research in a book for everyone.

Ahn draws on decades of research from other cognitive psychologists, as well as from her own groundbreaking studies.

And she presents it all in a compellingly readable style that uses fun examples from K-pop dancing, anecdotes from her own life, and illuminating stories from history and the headlines.

Thinking 101 is a book that goes far beyond other books on thinking, showing how we can improve not just our own daily lives and tackle real-world problems through better awareness of our biases but also the lives of everyone around us.

It is, quite simply, required reading for everyone who wants to think―and live―better.

“A smart and compellingly readable guide to cutting-edge research into how people think.”

5. Daily Visual: US Adults who Watch Digital Video via Non-TV Devices

% of respondents

Source: Insider Intelligence

6. Daily Acumen

“It's very valuable to cultivate this habit of seeking opportunities for scaling, even if the payoff is uneven; people who haggle about everything will end up getting moved to better seats on planes every so often, but if they also negotiate a 2% better raise or offer every single year, their lifetime earnings will be 55% higher, and if they fight for higher equity compensation at the right time the results can be very nice indeed.”

Source: The Diff

7. Crypto Corner

8. Job Board

9. Memes of the Day

 

 

 

*****

What'd you think of today's email?

Login or Subscribe to participate in polls.

Reply

or to participate.