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Halftime Report: 2021 Edition
As crazy as it sounds, 2021 is already halfway over. With the end of the second quarter, now the anticipation for earnings calls and reports is brewing up like a team walking out of the tunnel after halftime. It was a busy quarter, so let’s broadly review quarter 2 first:
- Media continues to sensationalize meme stocks. Every week there is a new meme stock headline, and the internet is always on the lookout for its next victim.
- The three major indices (Dow, S&P 500, NASDAQ) generally went up and to the right, setting a new record almost every week. I would attribute this to the reopening of the economy and the general public getting vaccinated.
- Inflation was a major concern among investors, but not enough for the Fed to implement a rate increase right now. The Fed did however move the rate increase date to 2023 from 2024.
- Sports and concerts are back! Tourism and travel are rebounding as well. Airfare prices are skyrocketing to recoup losses from the past year and 343K hospitality jobs were added in June.
Heading into the second half of 2021, and more directly the upcoming calls, here is a list of questions I am looking to see answered:
- Q2 was Jeff Bezo's last full quarter as CEO- how did $AMZN perform? How smooth was the transition to the next CEO?
- How will increased wages impact investment banks' ($GS, $JPM, $MS, $CS, etc.) bottom line?
- Will Disney+ surpass other streaming platforms in terms of # subscribers? Also for $DIS, what % of revenue will theme parks make up?
- The majority of the American people got vaccinated in Q2. We already know vaccine makers ($MRNA, $PFE, $JNJ) made significant revenue from the contracts. What we don’t know - how did that influence revenue for drug stores ($CVS, $WBA)?
- How have inflation concerns impacted spending on consumer staples ($PG, $KO, $UL, etc.)?
- The ongoing chip shortage has domino’d its way into every industry. Will we see a lot of unearned revenue for chip companies ($ASML, $TSM, $NVDA, $AMD) for contracts? And on the flip side, how will the delays impact automotive companies ($F, $GM, $TSLA etc.) and tech companies ($AAPL, $GOOG, $AMZN), the two industries this shortage impacted first?
- $AAPL launched a massive privacy protection feature in iOS 14.5 where, according to a recent report, most users have opted out of tracking. How will this impact $FB's bottom line, given the advertising magnate they have built? Also- how will Facebook change its advertising strategy long-term?
- How have DAU or MAU numbers changed for $SNAP & $SPOT due to the reopening? Are more people recording their memories (applicable to Snapchat) or going to parties where music would be played (applicable to Spotify).
- $ETSY acquired Depop during Q2. What is Etsy's long-term strategy for Depop, and how does the market for second-hand goods fit their business model?
Q2 earnings calls should be exciting as we will probably see some exciting Y/Y numbers. Q2 2020 had the extreme negatives for most companies, thus I am also looking forward to seeing how companies have rebounded over the past 12 months. Additionally, I am interested in seeing how COVID impacted long-term strategy for many companies.
Onward to the second half of 2021 - may the force be with you all!
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