A Weekly Update on Happenings in Special Situations
  • Bally’s $BALY rejected Standard General’s takeover proposal and announced a $300 - $500mm tender offer.

  • Spirit Airlines $SAVE rejected JetBlue’s $JBLU takeover proposal due to regulatory concerns and reiterated support for the merger with Frontier $ULCC.

  • Radius Global Infrastructure $RADI reportedly exploring strategic options including a sale.

  • Ubisoft $UBSFY founding family is considering a take-private in light of private equity interest.

  • Chesapeake Energy $CHK in discussions with activist Kimmeridge regarding changes to boost value.

  • Hasbro $HAS activist Ancora disclosed a 1% stake, backed the other activist (Alta Fox), called for a board refresh, and sale of eOne business.

  • Western Digital $WDC activist Elliott disclosed a 6% stake and proposed separation of its businesses, suggesting 100%+ upside.

  • Vista Outdoor $VSTO announced a plan to separate via a spin-off of its outdoor products segment.

  • Funko $FNKO 25% stake acquired by The Chernin Group, eBay $EBAY, Bob Iger, and Rich Paul.
Upcoming Earnings Calendar (Jan 24-28th) - BIG week ahead!
Hey guys! Here's the upcoming earnings calendar! Definitely a very busy week ahead. Here's what I'll be looking at:

  • $MSFT - Can Azure keep its growth rate? Will a slowdown cause a sell-off similar to the one $NFLX had?
  • $TSLA - Post earnings reaction. This is one of the few high-growth stocks that has shown relative strength. Let's see if this changes post ER.
  • $LOGI - Is demand for gaming peripherals still strong? May be an early indicator of videogaming strength.
  • $AAPL - It's always interesting to hear what Apple is doing.
  • $V - Data on consumer spending.
  • $CVX - General comments on the energy market.

If you'd like an easier way to track earnings dates, you can automatically sync your portfolio's earning dates to your personal calendar with just a couple of clicks here.





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Is "The Street" a parody website?
I put a lot of faith in 'smart money' sell-side analysts and take a lot of my fundamental information from seemingly reputable financial news sites. @nathanworden cautioned me recently on the reliability of these analysts and news sources, and while I've always known that doing your own due diligence is paramount for any trading or investment decision, I've never had an experience to really cement this fact...until now.

During my daily news reading, I followed a news rabbithole and wound up on www.thestreet.com. In particular, this article about bearish sentiment on $MO and $WDC (I'm long $WDC btw which is why I was interested).

I damn near wet myself when I saw their technical analysis of the charts. What the actual fucking fuck is this?

Followed by this total fucking monstrosity.

What's even better is that these are the two examples they chose to market and position one of their subscription services!

If you know me then you'll know I'm somewhat new to trading as a whole (less than a year) so is "The Street" a mock-up, or satire, or a parody, or something? Or is this genuinely their perception of technical analysis?

If this was my first introduction to technical analysis then I'd completely understand why there is so much cynicism behind it. What a total and utter embarrassment.

If you're unfamiliar with me or technical analysis, please rest assured that this is not it!

P.S. $WDC is up 10% this week so suck it.
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@tecantra good catch! I have a few thoughts on it.

  1. The Street itself is a good source but like all sources it’s the author that is ultimately creating the content. I suspect that author is what you have a problem with. Authors are people and therefore fallible / have biases that drive their interpretation to match their preconceived notions.

  1. Keep thinking for yourself. I think it’s a great sign that despite you being a new investor you are starting to be able to see beyond the articles and think critically about them.

  1. Finding these bozo’s are a great way to find alpha!
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Dylan Patel's avatar
$88.5m follower assets
Don't underestimate the elasticity in DRAM and NAND markets!
DRAM bit supply should increase 18.6% in 2022, but a demand increase of 17.1%, causes a 15% YoY decrease in pricing
This decrease would be in H1, and H2 could even have price increases.
Annual DRAM revenue for 2022 $91.54B, 0.3% YoY increase
NAND bit supply should increase 31.8% in 2022, but demand increase of 30.8%, an 18% YoY decrease in pricing,
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A small shift up or down in demand blows out consensus estimates. Just think about it. DRAM demand 5% higher makes pricing go from down 15% to up a bit, and $MU and other dram plays crazy cheap. Likewise, 5% lower demand than consensus sends DRAM tanking.
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Big Week Ahead! (Oct 25-29 Earnings Calendar)
Next week will probably be the most interesting week for the stock market this quarter. The largest companies in the world are all reporting and we'll get a lot of very valuable insights.

Here's what I'm interested in:
  • More context on the slowdown in ad spending from $FB $GOOG and $TWTR. Let's see if these companies are experiencing similar issues to the ones $SNAP mentioned yesterday.
  • Comments on the global supply chain issues from $KMB $MMM $GLW $LOGI and others.
  • A general update from $AMD $TDOC $SHOP and$AMZN.
  • Perspectives on the energy market from $XOM $CVX

Comment below what earnings call you're looking forward to!

Remember you can automatically sync your portfolio's earning dates to your personal calendar with just a couple of clicks here.





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Companies Still Facing Inflationary Pressures
Tomorrow, the U.S. BLS will release its preliminary estimates for the August inflation numbers. In July, inflation slowed down a little bit. If it continues to decelerate, it could bode well for the broad indices ($SPY $QQQ $DIA $IWM), since it might incentivize the FED to delay QE tapering.

Given the importance of inflation in determining macroeconomic policy, and right before the CPI release tomorrow, I believe it's a good time to review what companies have been saying regarding inflation.

This post by Fincredible compiles recent quotes from several earnings calls on inflation. Here are the one's I find most relevant:

  • $TSN COO: "We've had inflation on all inputs. We believe grain and our cost of goods will crest in early Q4. In fact, it has based on the forward-looking curves... Labor is our single biggest issue we face not only in Chicken but also in our other businesses. We've increased wages and created flexible shifts, childcare, on-site clinics."

  • $AAP CFO: "In terms of inflation, we certainly experienced inflation throughout the P&L. And the wage inflation was higher than our expectations. Certainly, the product costs are well within our expectations. They are a little over 2%"

  • $WDC CEO: "We're definitely facing inflationary pressures across the board. We've talked about the semiconductor components already on this call, and we're seeing lead times extend out. We're seeing challenges on the cost side as well. And we're going to -- we think we're going to face that across a number of different commodities."

  • $ROOT CEO: "You can see general inflation throughout the U.S. economy. I don't see that dropping back down in the next 12 months to zero trend levels. So I see the severity as part of probably more of a 12- to 18-month sustained increase. But again, we've only got 3 to 6 months' worth of data so the trends are pretty hard to tell there.”

It's clear businesses continue to face inflationary pressures, but it's still too early to tell if inflation has been accelerating or decelerating relative to the first half of the year. Tomorrow, courtesy of the BLS, we'll have more color on the topic.

In the meantime, if you'd like to read the whole post with several more quotes, here's the link: Fincredible MacroTalk September 8: Inflation
$AVGO Insights on the Semiconductor Market
During yesterday's earnings call, Broadcom CEO $AVGO said demand in the semiconductor market has been distorted by OEM's building inventory:

"The OEM, the end users, just go to our distributors and wipe out our inventory. So we show a resale growth of 55%, and we all know that's not real demand. People are building up buffer. There's a certain level of panic buying**.** Take that across all segments of semiconductor markets today" - Hock Tan - CEO

Once this panic buying subsides and companies looking to deplete their inventories order less, we could see a significant short-term decrease in demand for semiconductors. $TSM $MU $INTC $WDC $AMD $NVDA.
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