Spooky Earnings Szn

Market Snapshot Stocks were down to start the week ahead of a flurry of Q3 earnings releases coming up. PepsiCo, Delta, Walgreens, Blackrock, and several big banks will tell investors this week how bad JPow is railing them. It sure seems like plenty of bad news is priced in, but we’ll see how the market reacts to reports this week. At the close, the Dow sank 0.32%, the Nasdaq dropped 1.04%, and the S&P fell 0.75%. Going from monkey to master of the universe ain’t easy. You need to network your a$$ off, schmooze your bosses, and know your stuff. Give yourself a leg up by learning the essentials of M&A through the WSO M&A Modeling Course. [Hone your deal-making skills today](=) Let’s get into it. Monkey Meme of the Day [image]( [Source]( Banana Bits - Rivian has a nightmare scenario on its hands after [recalling tens of thousands of vehicles]( over a loose bolt - The Bank of England is [offering to buy bonds]() to support languishing pension funds - Paris is trying to save energy this winter by [turning off the lights](=) across the city - PayPal angered users after announcing a [fine for misinformation]() but later retracted the statement Banana Brain Teaser Yesterday — I have two legs, but they only touch the ground while I’m at rest. What am I? Wheelbarrow. Today — It’s 100 bananas off of our [M&A Modeling Course]() for the first 15 correct respondents. LFG! 13 people went to a hotel which had 12 rooms and each guest wanted their own room. The bell boy solved this problem. He asked the thirteenth guest to wait a little with the first guest in room number 1. So, in the first room there were two people. He then took the third guest to room number 2, the fourth to number 3, ..., and the twelfth guest to room number 11. Then he returned to room number 1 and took the thirteenth guest to room number 12, still vacant. How can everybody have their own room? Shoot us your guesses at [vyomesh@wallstreetoasis.com](mailto:vyomesh@wallstreetoasis.com?subject=Banana%20Brain%20Teaser) with the subject line “Banana Brain Teaser” or simply [click here to reply!](mailto:vyomesh@wallstreetoasis.com?subject=Banana%20Brain%20Teaser) Macro Monkey Says Squeezed Margins in Q3 — That’s what investors are broadly expecting from the multitude of Q3 earnings releases this week. The Fed will have its ears to the ground to see how rate increases are rippling through the economy. With the hiking cycle beginning earlier this year, those increases should start to be felt throughout the economy. Some things to pay attention to: - Which industries were able to preserve profit margins by raising prices? Those that have managed to find sufficient labor this year will likely be on this list. - Are costs rising faster than price increases? - How “sticky” are prices within different industries? The stickier the prices, the wider margins companies can enjoy once costs start to come down When inflation is high, margins become more of a focus for investors. Big YoY growth numbers are empty calories when prices are growing 8%+. It will be interesting to hear how various industries feel about the economy going into Q4 as well. We’ve been hearing about an impending recession basically all year, and while the labor market is cooling slightly, the consumer is still in a relatively good spot. WSO M&A Modeling Course [image](=) Going from monkey to master of the universe ain’t easy. You need to network your a** off, schmooze your bosses, and get a bit lucky. But you also need to know your way around M&A, and there’s no better way to get up to speed than with the WSO M&A Modeling Course. Learn about everything from transaction types to due diligence through this self-paced collection of video lessons and case studies. [Hone your deal-making skills today]() What's Ripe Wheat Futures — Wheat prices have been relatively stable since mid-summer after wild spikes in the first half of the year. But the increasing intensity of the war in eastern Europe sent prices higher to start the week. Russia and Ukraine are some of the world’s top wheat producers, and the price of the commodity will likely continue to move along with news around the war. Wheat was up 7.53% by the end of the day. Walgreens Boots Alliance ($WBA) — Walgreens is reporting its Q4 earnings this week, and investors are generally optimistic. Vax demand at its U.S. locations likely helped it in the quarter. When you go in for a jab, chances are you’ll pick up some toothpaste or shampoo while you’re there. Although it’s been on a steady slide downward this year, $WBA has good value and pays a nice dividend, which helped lift shares Monday. $WBA was up 4.33% by the end of the day. What's Rotten Rivian ($RIVN) — The brutal year for Rivian got much worse Monday. 12k vehicles, nearly all that it’s produced in its lifetime, are getting recalled due to a loose fastener. Recalls are part of the game when you’re making cars, but this one will really hurt. $RIVN ended the day down 7.28%. DraftKings ($DKNG) — The fantasy sports betting company initially popped on the news that it was nearing a deal with ESPN but plummeted soon after. $DKNG has been looking for ways to outcompete main rival FanDuel. Both platforms offer similar services, but $DKNG has more coverage of international sports. As long as the market keeps growing, there’s probably room for an Uber-Lyft-style duopoly between the two companies. By the end of the day, $DKNG was down 13.82%. Thought Banana EVs Shift Eastward — American EV manufacturers are hoping that the industry doesn’t follow the same trajectory as the combustion engine vehicle. We all know about the Model T as the first widespread consumer car, created in the U.S. by Henry Ford. Detroit dominated the sector for decades, cranking out thousands of cars and enabling a booming economy in the area. But Detroit, and the U.S. more broadly, lost that dominant position to Japanese brands like Toyota, who were able to make higher-quality cars that Americans loved. History could be repeating itself in the EV market. - Other than Tesla, no other American EV maker has been able to gain a solid foothold in the industry. Rivian just took a huge step back this week - There’s been a deluge of EV IPOs in Asia this year, giving those companies the fuel needed to continue growing. - The Asian market, especially China, stands to be the biggest growth area for EV demand in the near future. For now, the U.S. seems more preoccupied with onshore chip production than owning the EV space. But giving up yet another lead in vehicle production would definitely hurt. We’ll see if the biggest American car brands can reinvent themselves as EV makers as the industry moves in that direction. Wise Investor Says “To be a successful business owner and investor, you have to be emotionally neutral to winning and losing. Winning and losing are just part of the game.” — Rich Dad Happy Investing, Patrick & The Daily Peel Team Was this email forwarded to you? Sign up for the WSO Daily Peel [here](. [ADVERTISE]( // [WSO ALPHA]() // [COURSES](=) // [LEGAL](=) Don't want The Daily Peel? [Unsubscribe here](=). Click to [Unsubscribe]( from ALL WSO content IB Oasis Corp. (aka "Wall Street Oasis") 20705 Saint Charles St Saratoga, California 95070 United States (617) 337-3353