🧚 Pixar is Back With Record-Breaking Figures

MARKET UPDATE

Good Morning Investor! Shares of AI-chip making sensation Nvidia ($NVDA) soared another 3.5% on Tuesday, propelling the company's market cap past both Apple ($AAPL) and Microsoft ($MSFT). That's right, Nvidia is now officially the world's most valuable company. Who knew chips could be worth more than apples and windows? In other market shenanigans, Amazon ($AMZN) announced that its $5 subscription service is expanding to include Medicare patients. The result? Shares of both Hims & Hers Health ($HIMS) and Walgreens ($WBA) rallied over 6%.

TODAY’S BIG HEADLINES

Pixar is Back With Record-Breaking Figures

The Orange Juice Industry is in Crisis

Fintech AI Salaries are Soaring

MEDIA & FILM

Pixar is Back With Record-Breaking Figures🧚

Chip Off the Old Blockbuster: This past weekend, Pixar managed to flip the box office on its head with its latest release, Inside Out 2. The film, featuring emotional characters like Anger, Fear, and Disgust, raked in a jaw-dropping $155 million in the US alone. That'll make parent company Disney ($DIS) as happy as a cat with a can opener.

• This whopping figure earns Inside Out 2 the title of the second-best opening weekend for an animated film ever. Surprise hits like this have been as rare as hen's teeth for Pixar lately, leading the company to double down on sequels for its beloved franchises. After all, if it ain’t broke, make a sequel!

• Global Glee: Globally, Inside Out 2 generated nearly double its US debut, pulling in around $295 million. This sum is even more impressive when you consider it's the first film to break the $100 million mark since Barbie. Talk about a comeback! Pixar's box office performance is more electrifying than a squirrel on a power line.

Time for a Happy Ending: Pixar has been navigating rough seas in recent times, with a new generation of directors and voices post-pandemic striving to make their mark. This has resulted in mixed reactions from younger audiences. Films like “Luca” and “Soul” were well-received critically but didn’t come close to the financial fireworks of Inside Out 2. This financial strain even led to Pixar laying off 14% of its staff in a bid to cut costs. Could Inside Out 2 be the magic potion Pixar needed to rejuvenate its fortunes? It’s starting to look like this might just be the beginning of a new era for the famed filmmaker.

CONSUMER DISCRETIONARIES

The Orange Juice Industry is in Crisis🙇

Orange Juice in a Blender of Woes: Hold onto your breakfast, folks! The beloved orange juice industry is in crisis, with prices hitting fresh all-time highs thanks to a disaster-cocktail of climate-fueled extreme weather, supply constraints, and a citrus disease known as greening. It's like Mother Nature decided to put our morning OJ on the rocks—literally and figuratively.

• Brazil's Bitter Harvest: Late last month, the price of orange juice shot through the roof after Fundecitrus, a research center, sounded the alarm. Brazil, the world's largest producer and exporter of orange juice, is on track for one of its worst harvests in over thirty years. It’s a supply shock that's squeezing the life out of the market.

• Frozen concentrated orange juice futures, traded on the Intercontinental Exchange ($ICE) in New York, closed at $4.29 per pound on Monday, reflecting an almost doubling in price year-over-year. The benchmark contract has slid somewhat in recent weeks, falling from an intraday high of nearly $5 per pound on May 28th. If this rally keeps up, we might start seeing orange juice futures next to gold in investment portfolios.

The New Diluting Juice: The crisis has reached the point where manufacturers are getting creative—or desperate. They’re now exploring alternatives such as diluting orange juice with other fruits like pear, mandarin, or apple. So, if your orange juice starts tasting a bit like a fruit salad, you’ll know why.

Brazil’s Squeeze: Brazil, the MVP of the orange juice world, usually churns out about 300 million boxes of oranges (each weighing approximately 40.8 kilograms) per cycle. But this cycle, they’re seeing dramatically lower numbers thanks to floods, drought, and the ever-persistent greening disease taking a bite out of their crop populations.

• Forecasts now peg Brazil’s production at 232.4 million boxes of oranges for the 2024 to 2025 season—a staggering 24% decline compared to the previous cycle.

• Restoring normal stock levels in Brazil will require several consecutive good harvests, meaning high prices are likely here to stay. So, brace yourselves for pricey pours and maybe a bit of pear in your OJ.

FINTECH

Fintech AI Salaries are Soaring🛰️

Battle of the Bands: In a showdown that makes "Battle of the Bands" look like a ukulele recital, big tech titans are snapping up AI talent faster than you can say "neural network." Meanwhile, fintech firms are pulling out all the stops, shelling out serious cash to lure these digital maestros to their side. It’s a high-stakes talent tug-of-war, and the offers just keep climbing.

AI Arms Race: The explosion of generative AI has companies racing like caffeinated squirrels to develop their own AI marvels, or risk being the tech world's equivalent of VHS in the age of streaming. In fintech, AI isn't just a buzzword; it's a fraud-fighting, customer-pleasing powerhouse.

• Visa ($V) flexes with its fraud prevention tool, which thwarted a cool $27 billion in fraudulent purchases in 2022.

• Capital One ($COF), not to be outdone, is hoarding AI patents like they’re going out of style, building a research fortress worthy of an evil genius.

• American Express ($AMEX) already has "Mezi," an AI travel booking assistant that’s probably better at planning vacations than you are.

Lucrative Offers: Show Me the Money!: If you're wondering just how much fintech firms are willing to shell out for top AI talent, grab a chair and hold onto your hat. While a hefty slice of these salaries comes in stock options and sign-on bonuses, the numbers are still eye-popping:

• American Express - Engineer, AI/ML ($85,000 - $150,000)

• Block - Machine learning engineer - ($160,000 - $272,000)

• Capital One - Senior ML engineer - ($161,900 - $184,800)

• Discover Bank - cybersecurity engineer (AI/ML) - ($104,000 - $175,600)

• Mastercard - Senior ML engineer - ($115,000 to $184,000)

• PayPal - Machine learning manager - ($135,000-$145,000)

Industry-Wide Frenzy: And it's not just the big names playing this high-stakes game. Other firms like Stripe, Visa, Adyen, and Wise are all throwing their hats into the ring. Given these sky-high figures, it's crystal clear: AI engineers are the rock stars of the tech world right now. But the million-dollar question remains—will these AI whiz-kids drive profits skyward or simply jack up the costs? Much like an extra pump of creme in your morning Starbucks coffee.

MORE NEWS

Additional market-moving events🌎

Adobe in the Crosshairs: The FTC has sued Adobe ($ADBE), alleging that the company hid its excessive termination fees in its subscription plans and made cancellations difficult. (Reuters)

Buffett’s Favourite: Warren Buffett has been buying shares of Occidental Petroleum ($OXY) for 9 days straight now, taking his stake up to nearly 29%. (MSN)

The Nvidia Preference: Nvidia ($NVDA) is being given preference in the Technology Select Sector SPDR Fund ($XLK), with the company being given a 21% weighting while Apple's ($AAPL) weight will decrease to about 4.5%, marking a shift of over $10 billion in assets within the $71 billion ETF. (CNBC)

UBS Buyback Plan: UBS ($UBS) has initiated a new share repurchase program, after having purchased $50.2 million worth of shares last week. The new program aims to repurchase up to $1 billion in shares in 2024. (Reuters)

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. Then on the 10th of June we released our next stock selection.

Here’s how the three stocks have performed since:

• Evolution AB: 1,068.00 SEK (📉-18.70%)

• Hims & Hers Health: $25.59 (📈+76.81%)

• PayPal: $59.18 (📉-8.63%)

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