🍋 DoorDashing to the Moon
"An asset you don't deserve can quickly become a liability." — Morgan Housel
Good Morning! AMC is planning to issue 517 million shares of preferred stock, and the symbol will be APE, paying homage to its retail fan base. Pension funds are going crypto. A $6.8 billion pension fund in Northern Virginia was recently authorized, by its board, to start making crypto investments. BlackRock is also looking at crypto and teamed up with Coinbase to expand into the new asset class. Looking backward, Shake Shack (a place where a lot of crypto millionaires may have worked), is struggling (down 6%) as lunchtime foot traffic in NYC has slowed. According to Future Forum’s latest Pulse report, 69% of people are working either fully remote or hybrid.
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1. Story of the Day: DoorDashing to the Moon
After Q2 results came in, DoorDash shareholders must've felt like their orders just arrived. Results beat revenue expectations, and despite a bigger loss per share than expected, the stock jumped 18% after hours.
Let's look at the menu. According to DoorDash, the total number of orders delivered grew 23% year over year to an all time high of 426 million. Revenue also grew, to 30% year over year. Where, in this economy, is the growth coming from? Well it seems like users' laziness is outpacing economic headwinds. Great work y'all...
Even though DoorDash set the bar low guidance wise, by saying it expects a "softer consumer spending environment," for the 2H2022. Read: the laziness may be overcome by economic pressures on users.
The delivery company spent over $40 million in Q2 to balance the effect of high gas prices. It also acquired Wolt, an international food delivery platform. So, things might be looking up, despite the broader poor news the world has been delivering.
Short Squeez Takeaway: Betting on human laziness is always a great idea. DoorDash has built a $30+ billion business out of it. In my banking days, I used to get coffee delivered from the Starbucks on my block. I am a changed man now as I try to get my 12 steps in for the day. Anyway, enough about me. The average American may need to be more cost-conscious moving forward if inflation doesn't subside in a big way soon. It may be slow-moving, but I'm eagerly awaiting to see how this fast food situation plays out.
2. Markets Rundown
Equity markets were relatively flat overall, but mixed, while crypto was down with oversight legislation hitting the headlines.
Movers & Shakers
- (+) Coinbase ($COIN) +10% because of a new partnership with BlackRock that was announced.
- (+) MercadoLibre ($MELI) +16% thanks to an earnings beat after the bell on Wednesday.
- (–) Yeti ($YETI) -19% on missing expectations and DTC sales being lower than expected.
- Italy, Intel, close $5 billion deal for chip factory
- Wildfire fighter Bridger Aerospace, valued at $869 million, to go public via SPAC
- Private-equity backed Zelis Healthcare bought Payer Compass, a healthcare price transparency firm, for $180 million
- BorgWarner is paying $185 million to acquire Rhombus Energy
- Plastiq, a payment platform for businesses, is going public at a $480 million valuation
- Cera, a British long-term care startup, raised $320 million
3. Top Reads
- Job cuts and smaller bonuses loom for Wall Street amid collapse in IPOs (CNBC)
- Weekly jobless claims rise to 260,000 ahead of nonfarm payrolls report (CNBC)
- Workplace's new 'quiet quitting' trend — and the pitfalls for today's employees (Fox)
- Walmart announces layoffs as Americans cut down on spending (Fox)
- Wall Street confidence in stock market sinks to lowest level in 5 years (Fox)
- The PR and ad firms turning away fossil fuel clients (BBC)
- Democrats drop carried interest change, add stock buyback tax (BB)
- The cities where remote workers pushed up home prices and income (Axios)
- Russia faces economic oblivion despite claims of short-term resilience (CNBC)
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4. Book of the Day: The Aspirational Investor: Taming the Markets to Achieve Your Life's Goals
The Chief Investment Officer of Merrill Lynch Wealth Management explains why goals, not markets, should be the primary focus of your investment strategy—and offers a practical, innovative framework for making smarter choices about aligning your goals to your investment strategy.
Today all of us bear the burden of investing wisely, but too many of us are preoccupied with the wrong priorities—increasing returns at all costs, finding the next star fund manager, or beating “the market.” Unfortunately, conventional portfolio theory and the grand debates in finance have offered investors only incomplete solutions.
What is needed, argues Ashvin B. Chhabra, is a framework that shifts the focus of investment strategy from portfolios and markets to individuals and the objectives that really matter: things like protecting against unexpected financial crises, paying for education or retirement, and financing philanthropy and entrepreneurship.
The Aspirational Investor is a practical, innovative approach to managing wealth based on key goals and the careful allocation of risks rather than responding to the whims of the financial markets.
Chhabra introduces his “Wealth Allocation Framework,” which accommodates the three seemingly incompatible objectives that must underpin every sound wealth management plan: the need for financial security in the face of known and unknowable risks; the need to maintain current living standards over time despite inflation; and the need to pursue aspirational goals for wealth creation.
Chhabra reveals some surprising facts about wealth creation, reinterprets the success formulas of investing greats like Warren Buffett, and closes the gap between theory and practice by simplifying our understanding of key asset classes and laying out a concise roadmap for identifying, prioritizing, and quantifying financial goals.
Raising the bar for what we should expect from our investment portfolios—and our financial advisors—The Aspirational Investor sets us on a path to more confident and fulfilling financial lives.
“What’s fascinating here is not which camp won or lost but rather the mere fact that pitting dart throwers against professional stock pickers was even a meaningful competition. Would a similar contest questioning the utility of other professionals, such as doctors or engineers, endure for fourteen years and finish so inconclusively?”
5. Short Squeez Picks
- Spotify’s stock has bounced back 17% after last week’s Q2 earnings release. But will Spotify continue to moon? Model it out yourself! Daloopa is giving Short Squeez readers access to Spotify’s detailed financial model. Download SPOT's Model for FREE here
- How universal are our emotions?
- Is the idea your summer vacation cures burnout a scam?
- What a $250,000 Antartica wedding package will get you
- Why we make more virtuous choices when using pen and paper
A Message from Fantasy Life
We do the same thing over at Fantasy Life, except it’s for the fantasy football markets.
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Each day our contributors compile the latest NFL news, drafting strategies, players to draft and fade, and betting opportunities.
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6. Daily Visual: Mortgage Rates Fall Below 5%
Average US 30 Year fixed mortgage
7. Daily Acumen: Beliefs
Not caring about temporary things, and obsessing over permanent things, is underrated.
Good marketing wins in the short run and good products win in the long run.
When reading the news, you can increase your productivity 100x by asking, “Will I still care about this a year from now?”
If your expectations grow faster than your money, you’ll never be happy no matter how much you accumulate.
People who are exceptionally good at one thing tend to be exceptionally bad at other things.
The world is governed by probability, but people think in black and white, right or wrong – did it happen or did it not? – because it’s easier.
It’s hard to empathize with other people’s beliefs if they’ve experienced parts of the world you have not.
The cure to overconfidence is constantly reminding yourself that you’ve experienced maybe 0.00001% of the world.
We are extrapolating machines in a world where nothing too good or too bad lasts indefinitely.
Source: Collaborative Fund
8. Crypto Corner by Bonkalytics.com
- Coinbase shares soar in boost from meme traders, BlackRock crypto deal
- Crypto bankruptcies threaten customer life savings
- Bitcoin’s price dip provides a ‘good accumulation point’ at a low expense
- The hyper-local side of crypto
- Why sometimes stealing crypto is the moral choice
- New crypto oversight arrives as industry shakes
For more crypto-focused content, sign-up here.
9. Memes of the Day
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