💰 Instagram makes more money than YouTube

Good morning Investor. “Go for a business that any idiot can run - because sooner or later, any idiot probably is going to run it”, “Although it's easy to forget sometimes, a share is not a lottery ticket... it's part-ownership of a business”.

— Peter Lynch, Former manager of the Magellan Fund

MARKET UPDATE

TODAY’S BIG HEADLINES

• Instagram makes more money than YouTube

• The booming AI drug dealing industry

• China wants to disrupt Boeing & Airbus

• Google’s next-gen AI chip

MEGA CAPS

Instagram makes more money than YouTube💰

Supreme Acquistions: Since Alphabet (GOOGL) acquired YouTube back in 2006 for $1.65 billion, Its become widely accepted knowledge that this was one of the most successful acquisitions of all time…until today. because it seems there’s a new champion in town. This just in: Meta (META), in a recent FTC filing, dropped the bombshell that Instagram, their billion-dollar baby it acquired back in 2012 for a mere $1billion, is actually outperforming the video-streaming Goliath, YouTube, in terms of revenue. Talk about a plot twist!

Secrets Revealed: The filing spilled the beans that Instagram raked in a whopping $32.4 billion in 2021, leaving YouTube’s $28.8 billion trailing in the dust. And this isn’t a one-hit-wonder situation. Instagram has been leading the revenue race since 2019. The secret sauce? YouTube’s generous habit of sharing about 55% of its ad revenue with creators. Another juicy tidbit from the filing: Instagram’s contribution to Meta’s overall revenue has leaped from 26% in 2020 to nearly 30% in the first half of 2022. Instagram, it seems, is not just a pretty face.

The TikTok Opportunity: With TikTok teetering on the edge of a sale or a ban in the US, survey data from YouGov suggests that TikTok’s user base might just hop over to Instagram’s Reels feature to satiate their scrolling addiction. Could Instagram be the secret ingredient in Meta’s recipe for continued global social media domination? Stay tuned!

sources: (The Verge)

HEALTHCARE

The booming AI drug dealing industry💊

Eating The Fat: It’s no secret that the weight loss drug market is expanding faster than a waistline at an all-you-can-eat buffet. Novo Nordisk’s (NVO) Ozempic and Wegovy have been printing money faster than a counterfeiter in a basement, becoming the darlings of the company’s portfolio.

Eli Lilly’s Amazonian Alliance: Not to be outdone, Eli Lilly (LLY) has cozied up with Amazon (AMZN), launching same-day prescription deliveries that are so convenient, they’re practically hand-feeding you the pills. And let’s not forget Costco (COST), who’s now offering GLP-1 drugs at a discount, making it seem like we’re a stone’s throw away from having these meds in vending machines next to the soda and chips.

The Fake Drug Frenzy: As predictable as a plot twist in a soap opera, the market is now flooded with counterfeit Ozempic. The EU and UK are awash with these faux-pharmaceuticals, and Ireland’s illegal imports have skyrocketed fivefold, turning semaglutide into the new must-have contraband.

Virtual Healthcare: Hims & Hers (HIMS) is riding the virtual healthcare wave, targeting the long waiting lists in the US and UK. Their CEO is so bullish on the weight loss sector, he’s predicting a revenue tsunami of over $100M in 2025, which has subscribers flocking to them like seagulls at a beach picnic, resulting in an increase in subscribers of 48%.

The Buzzword Cocktail: What sets Hims & Hers apart in this crowded market? A dash of AI. They’ve been dishing out “personalized treatments” since 2023, making them as unique as a unicorn in a field of horses.

Wall Street Whispers: The weight loss drug moguls are laughing all the way to the bank, with their stocks soaring like eagles. Over the past year, Novo Nordisk’s shares have ballooned by 60%, Eli Lilly’s have doubled with a 111% surge, and Hims & Hers have enjoyed a healthy 51% uptick.

sources: (cbsnews), (Quartz), (BusinessInsider), (Bloomberg)

MANUFACTURING

China wants to disrupt Boeing & Airbus🛫

A Seat At The Table: In the high-stakes poker game of global aircraft manufacturing, two titans, Airbus (EPA: AIR) and Boeing (BA), have been holding all the aces. But Boeing’s recent stumble has left customers twiddling their thumbs in waiting rooms, creating a golden opportunity for a new player to join the table. Enter stage right, Comac, a Chinese state-backed contender, ready to shuffle the deck.

Background: Comac isn’t exactly a greenhorn. They’ve been in the game for over a decade, albeit dwarfed by the towering presence of the Airbus-Boeing duopoly. But with Boeing’s supply chain hitting a snag and Comac’s latest brainchild, the C919 grand, making a grand entrance in Singapore last month, the stage is set. The C919, a direct rival to Boeing’s 737 - now more infamous for its safety issues than its in-flight peanuts - could be Comac’s ticket to a slice of the aviation pie.

The likelihood: As of now, Comac is expected to deliver a modest total of 9 jets in 2024, which is less than a third of Boeing’s monthly output. To put it in perspective, that’s like trying to fill a swimming pool with a teaspoon. But here’s the kicker - IBA’s estimates suggest that by 2030, Comac could be serving up 4% of global narrow-body deliveries, carving out just over 1% of the market share. For Boeing, that’s like finding a fly in their champagne. Cheers to that!

sources: (Fortune)

MEGA CAPS

Google’s next-gen AI chip💿

Chips, Chips & More Chips: Picture this: It’s a bright Tuesday morning at the Google Cloud Next 2024 event. Alphabet (GOOGL) steps onto the stage and unveils Axion, its first Arm-based CPU, tailor-made for data centres. These aren’t just any chips, folks. These are the powerhouses that will be driving cloud computing data centres, the training grounds for present and future AI models.

The Nitty-Gritty: The new chips are a product of ARM’s Neoverse V2 CPU design. Google claims it’s 30 percent more efficient than its fastest general-purpose Arm-based tools in the cloud. And it’s not just a paper tiger. It’s already flexing its muscles in the Google Earth Engine and BigTable.

Competition is Hot: With this move, Google throws down the gauntlet to Amazon (AMZN) and Nvidia (NVDA). Amazon, who had their own cloud data centre CPU, Graviton, in the ring since 2018, and has since released two successors. Meanwhile, Nvidia, the storm that’s been sweeping the data centre market share, released their first ARM-based CPU, Grace, back in 2021, specifically built for data centres. It’s a veritable Clash of the Titans in the world of data centres. Grab your popcorn, folks. This is going to be interesting!

sources: (Engadget), (WSJ)

MORE NEWS

Additional market-moving events🌎

• Largest Bank Warns Of Trouble: Jamie Dimon, CEO of JPMorgan, recently released his annual letter to shareholders, wherein he warned of economic challenges, including inflation, government deficits, global uncertainty, and political divisions. (NYTimes)

• Kreme Rises To The Top: An analyst at Piper Sandler has upgraded Krispy Kreme on the news regarding their partnership with McDonalds. (Defenceworld)

• Luxury Battery Power: Italian luxury automaker Ferrari have opened their own “battery lab” in northern Italy, as the company gears up to get its first fully electric supercar to the finish line. (Fortune)

• Another Spinoff: Kleenex maker Kimberly-Clark is selling its personal protective equipment business which manufactures anything that could be categorised as “PPE“, gloves and eyewear for example. Sales for the division have tanked since the covid-related spike. (Cleanroom)

• Women’s Sports Break Records: The women’s Final Four game beat an ESPN viewership record set in 2018 during Game 7 of the NBA Eastern Conference finals between the Cleveland Cavs and Boston Celtics. (ESPN)

EARNINGS

This Week’s Earnings Calendar📅

• Delta Air Lines (DAL) will report Wednesday.

  • Analysts estimate $12.55B in revenue (-1.64% YoY)

  • $0.35 in earnings per share (+40.00% YoY).

• Constellation Brands (STZ) will report Thursday.

  • Analysts estimate $2.10B in revenue (+5.11% YoY)

  • $2.09 in earnings per share (+5.56% YoY).

• Fastenal Company (FAST) will report Thursday.

  • Analysts estimate $1.91B in revenue (+2.74% YoY)

  • $0.53 in earnings per share (+1.92% YoY).

• JPMorgan Chase (JPM) will report Friday.

  • Analysts estimate $42.05B in revenue (+6.90% YoY)

  • $4.21 in earnings per share (+2.68% YoY).

• Wells Fargo & Company (WFC) will report Friday.

  • Analysts estimate $20.19B in revenue (-2.60% YoY)

  • $1.09 in earnings per share (-11.38% YoY).

• The Progressive Corporation (PGR) will report Friday.

  • Analysts estimate $17.65B in revenue (+30.42% YoY)

  • $3.11 in earnings per share (+378.46% YoY).

• BlackRock (BLK) will report Friday.

  • Analysts estimate $4.66B in revenue (+9.83% YoY)

  • $9.25 in earnings per share (+16.65% YoY).

• Citigroup (C) will report Friday.

  • Analysts estimate $20.41B in revenue (-4.84% YoY)

  • $1.22 in earnings per share (-44.29% YoY).

OUR PICKS

Our selections performance👾

On Monday the 11th of March, we released our “two superperformers” stock picks which we believe will provide significant outperformance compared to the S&P 500.

Here’s how the two stocks have performed since then:

• Evolution AB: 1,303.00 SEK (📉-1.30%)

• Hims & Hers Health: $15.47 (📈+0.55%)

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