Drinking Athletically

Find out how to become more Athletic through drinking July 10, 2024 | Peel #747 Silver Banana goes to... [SRS Acquiom. ]() In this issue: - 📉 Chair Powell sat down for a scolding and gave more insight on rates - 🚘 Tesla shares keep poppin while Helen of Troy looks to start another war - 🍺 Find out how to become more Athletic through drinking Market Snapshot 📸 Banana Bits 🍌 - Chair Powell sets the stage for [cutting rates]( - Housing inventory is finally moving in [the right direction]() - Morgan Stanley's CIO is the market’s [biggest hater pre-election]( - Corporate bankruptcies are [on the rise](=) Due Diligence Trends: Data You Can Bank On What do 150 senior executives at U.S. investment banks with up to $1 billion in AUM know about due diligence? Shocker: quite a bit. That’s why SRS Acquiom and Mergermarket teamed up to talk with them about it. The survey covered both buy-side and sell-side, and included the bulge bracket, the boutique, and those firms in between. They had plenty to say, especially given how important it is to stay ahead of the curve in an M&A market like this one. A few spoilers: Is due diligence taking longer? Yep. Is regulatory scrutiny rising? Sure is. The point is, there’s a whole lot of intel to be absorbed (and applied), and it’s all in the new SRS Acquiom M&A Due Diligence Study. [Download it while it’s hot.]() Macro Monkey Says 🐒 The Roast of Jerome Powell After 7 Super Bowls, a 13-year marriage to the world’s most popular supermodel, and making over half a billion dollars, it’s hard to roast Tom Brady. But roasting Fed Chair Jerome Powell is a lot easier. That’s why the big red streaming giant had to bring out the big guns with some of the world’s most famous comedians to roast Brady. Meanwhile, just a few lowly Senators torched JPow. Our silver fox Fed Chair was on Capitol Hill for day one of his semiannual testimony to the Senate Committee on Banking, Housing, and Urban Affairs. Let’s see how it went. What Happened? If standing on business was a person, it’d be Jerome Powell. In addition to Senator Elizabeth Warren once again [flexing her nonexistent awareness]() of anything related to economics, we got some valuable tidbits about exactly how Chair Powell plans to steer the economy going forward. [Source]() Market-implied odds of one or two rate cuts by year-end increased throughout Powell’s testimony as JPow once again reiterated his view that the economy has officially cooled down from the post-pandemic rally. One remark that especially embodied this view came when Powell said, “In light of the progress made both in lowering inflation and in cooling the labor market … elevated inflation is not the only risk we face.” Wall Street just about orgasmed hearing that, and it only got better when Powell went on to say, “Reducing policy restraint too late or too little could unduly weaken economic activity and employment.” Boom. That’s what everyone was waiting to hear. It’s not like analysts didn’t already know that, but knowing that the Fed Chair knows it is crucial confirmation to macro expectations going forward. [Source]( Seeing the yield on 2-year Treasuries spike leading into Powell’s testimony, only to fall back to Earth right after, elegantly tells the story of the market’s uncertainty regarding the Chair’s perspective on changing monetary policy too soon vs. too late. JPow did hedge himself by saying, “We know that reducing policy restraint too soon or too much could stall or even reverse the progress we have seen on inflation.” So, Powell’s message on rates has widely been received as him saying: - We’re going to cut rates - We don’t know when we will, but… - Macro risks are leaning more towards recession than overheating in the second half of 2024, so… - Expect rates to move lower by the end of this year. The only thing that remains unclear is 1) when those rate cuts will come and 2) the magnitude of those cuts and other potential policy loosening maneuvers. Normally, Powell and the FOMC are most closely watching the PCE report to vibe-check core inflationary pressures. However, based on yesterday’s dialogue, it seems that Powell is more focused on labor market vibes in balancing the Fed’s dual mandate of stable prices and maximum employment. Powell’s assessment of the labor market centered around his comment that conditions are “strong, but not overheated,” adding that we’re essentially back to where we were before C-19 showed up. The Takeaway? Powell has as clear a timeline on the path of interest rate cuts as you, me, and my dog. No one knows how or how much, but it’s clear policy loosening is on the horizon. We do, however, know the what. Interest rate cuts are almost certainly inbound, and it appears that employment reports will be a bigger driver of the FOMC’s decision-making on this front going forward. Stay tuned. What's Ripe 🤩 Jumia (JMIA) 📈29.9% - As Mufasa did to Simba, one Wall Street firm just held Jumia up to peer across Africa, saying, “Everything the light touches is your market opportunity.” - The Amazon/UPS/Venmo of Africa burst into the canopy on Tuesday thanks to Benchmark initiating coverage with a Buy rating and calling for a 60% upside. - Benchmark called the firm a “unique opportunity” as it allows investors to get exposure to African e-commerce, projected to grow 20%/yr through 2030. Tesla (TSLA) 📈3.7% - After falling 43% through late April, Tesla shares have bounced an insane 85% since. All it took was a slight uptick in Q2 deliveries combined with a short squeeze. - Pessimism peaked after Q1 deliveries disappointed, increasing short interest in the stock that’s now become a short squeeze, driving this insane 2-month gain. - The WSO Alpha portfolio loves to see it. Oh, by the way, we just published our first Sell report, so check that out [here](=). What's Rotten 🤮 Helen of Troy (HELE) 📉27.7% - This wouldn’t be the first time [Helen of Troy](=) started a war, but instead of Trojan Horses and The Illiad, this one’s losses will only be financial... we hope. - The CPG maker tanked harder than Troy on lousy earnings, delivering $0.99/sh on $416mn in sales, 38% and 6.5% below estimates, respectively. - FY2025 guidance was slashed as well, citing shipping disruptions at their Tennesse-based facility. Low housing turnover also hurt sales. BP (BP) 📉4.8% - Major win for ducks and other residents in the Gulf of Mexico yesterday as BP shares tumbled on news that they’ll be facing their own impairments. - The oil giant announced a $1-2bn profit hit this quarter due to markdowns of tax-linked assets and incidental contract provisions. Thought Banana 🤔 Athletic Drinking It pays to be athletic. At 24, it’s crazy to think that athletes earning tens of millions of dollars per year, like Wemby or Zion Williamson, who are younger than me. It’s a real slap in the face, especially when the only “athletic” I can get looks like this: [Source]( And just like those athletes above, this Athletic is absolutely raking it in. Let’s find out why. What’s Going On? Taking the fun- I mean, *alcohol out of beer seems like a bold move. But, after the pandemic locked us inside and forced everyone to become an alcoholic in order to tolerate being around our families all day, the responsible ones among us are looking to cut back on alcohol consumption. Enter Athletic. Founded in 2017, Athletic Brewing started as one of the smallest breweries in the U.S., shipping just 875 barrels of non-fun- I mean, *non-alcoholic, beer across the country. In 2023, Athletic was making Bud Light extremely jealous, skyrocketing volumes to over 258k last year. That’s 5-year growth of 29,386%, or a CAGR of 211.6%. Not even Nvidia comes close. [Source]( Now, investors have finally gotten over their hangover and decided they should get a piece of the action. Yesterday, the Connecticut-based brewery announced the completion of a $50mn fundraising round led by General Atlantic to expand its production footprint and “drive continued long-term growth” of what is now one of America’s favorite beers. To say Athletic dominates the non-alcoholic space is like saying Joe Biden is kinda old—it’s the understatement of the century. The company boasts the #1 market share in the non-alcoholic space at 19% of total volume, with sales growing 60% YoY in 2023, making Athletic the 20th largest brewing company in the United States. With their new $50mn check, Athletic plans to make renovations at newly acquired brewing sites, claiming this will double its total brewing capacity once complete We’re all gonna be athletic one way or another soon enough… I’m just glad my athletic won’t keep me on the bench for 5-years like Zion’s has. The Big Question: Is Athletic Brewing the next AB-Inbev? How large can the market for non-alcoholic drinks really get? Banana Brain Teaser💡 Previous 📅 In a small snack shop, the average (arithmetic mean) revenue was $400 per day over a 10-day period. During this period. if the average daily revenue was $360 for the first 6 days, what was the average daily revenue for the last 4 days? Answer: $460 dollars Today 🕐 If y is the smallest positive integer such that 3,150 multiplied by y is the square of an integer, then what must y be? Send your guesses to vyomesh@wallstreetoasis.com Wise Investor Says🤓 “The first thing I heard when I got in the business - not from my mentor - was, 'Bulls make money, bears make money, and pigs get slaughtered.' I'm here to tell you I was a pig. And I strongly believe the only way to make long-term returns in our business that are superior is by being a pig.” — Stanley Druckenmiller Today's Peel? 😁[All the bananas]( 😐[Meh]( 😩[Rotten AF]( Happy Investing, David, Vyom, Jasper & Patrick [ADVERTISE](=) // [WSO ALPHA]( // [ACADEMY](=) // [COURSES](=) // [LEGAL]() [Unsubscribe]( IB Oasis Corp. (aka "Wall Street Oasis") 14435 Big Basin Way PBN 444 Saratoga, California 95070 United States