Erick Mokaya's avatar
$102.4m follower assets
Our newsletter this week
Check out our weekly newsletter that covers:

  • Data that CEOs are seeing does not suggest that a downturn is imminent
  • PE and VCs with record amounts of dry powder
  • AT&T saw some delays in collections of payments

Companies covered:

Watch Twitter Earnings After This Snap Setback
Good morning contrarians! $SNAP is down 30% overnight after earnings disappointed investors, taking social media stocks down with it. $TWTR is due to report before the open…

Other earnings on deck include $AXP, $VZ, and $SLB. Markit PMIs are out at 0945.

What’s at stake and what to watch for is discussed in the daily briefing and podcast that you can get here:
Luka 🦉's avatar
$103.6m follower assets
Apple Bank 🪙
Apple Pay and Apple Card (for the moment, managed by Goldman Sachs) were the first steps for Apple to join the tremendous remunerative financial market. So many people nowadays use Apple Pay to buy products and services in shops and online.

While technically, such purchases are still a Visa/Mastercard transaction, I believe in the future; it will not be the case anymore. As a result, $AAPL can soon become a competitor of $V $MA $AXP.

Apple pay is already accepted mostly everywhere. If you allow people to store money in an Apple account (of course, it will require Apple to own a bank license, but it doesn't look like a problem), you can easily bypass the major credit card circuit.

The first step of it is the rumored Apple Pay Later...

Traditional Banks and the credit card industry will have a serious competitor sooner than later IMO. And I will not be surprised to see a high-profile M&A to seize a bank infrastructure.

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Credit card companies and BNPL companies are already beating inflation
What's the average interest rate for a credit card or a "buy now, pay later" loan?

For credit cards, it's 18%. For "buy now, pay later" loans, it's 23%.

Inflation is currently above 8%. Many companies' profit margins are below 8%. But for $V $MA $AXP $DFS $AFRM $SQ $PYPL etc., they're already making a lot more on each loan. Many banks envy these fintech companies.

Mortgage rates are surging, but at the same time, their rates haven't been as high as what the credit card companies and BNPL loan providers charge.

As for the % of people that pay their credit card and BNPL balances in full every month, it varies. For credit cards, it looks like 1/3 of users pay their balances in full each month. For BNPL, that number looks to be a lot lower because the credit quality of those that use BNPL is lower too. In general, the majority of their customers accrue interest in those companies. It explains why those companies are highly successful today.
Earnings, PMIs: Daily Contrarian, April 22
Good morning contrarians! Stock futures are lower a day after reversing course and posting losses. The catalyst was comments by Fed chair Jerome Powell signaling a rate hike of 0.5% at the Fed’s meeting next month.

This morning we have some earnings: $SLB just beat on top- and bottom-line estimates. Also before the open we’ll get $AXP $VZ and $KMB

Later we’ll get Markit PMIs.

Daily briefing and podcast are now available for premium subscribers:
April Purchases - Max the ISA Project
This morning I topped up my portfolio with April's contribution. Purchases include $BAC $VOO $DG $CMG $MA $SBUX $DIS $QQQ $AXP $HAS and three ETFs that tracking High Yield Global, UK 100, and Japanese markets.

The goal for this project, which began in 2022, is to maximise the £20,000 annual ISA limit for tax-free dividend income and capital gains. After 2 weeks of the new tax year, we are 7% of the way there for 2022.
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