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  • 💔 Intel Potential Breakup?

💔 Intel Potential Breakup?

+ Bill Ackman Wants To Build His Modern Day Berkshire Hathaway

February 18, 2025

Good afternoon! Uber is suing DoorDash, claiming its rival strong-arms restaurants into exclusivity by jacking up fees or burying them in search results if they also use Uber Eats. With DoorDash controlling over half the third-party delivery market and working with nearly every major chain, Uber argues restaurants have little choice but to play along.

Uber says these tactics have cost it millions, especially as it expands Uber Direct with partners like Toast, P.F. Chang’s, and Burger King. The lawsuit paints DoorDash as a delivery monopolist, while DoorDash calls it a baseless distraction from Uber’s own challenges.

MARKETS

*Stock data as of market close*

  • Stocks drifted aimlessly for most of Tuesday before a last-minute push sent the S&P 500 up 0.24% to a record close of 6,130. The Nasdaq barely budged, adding 0.07%, while the Dow inched up 0.02%, eking out a 10-point gain. Investors seemed unbothered by inflation worries and trade tensions, at least for now.

  • Still, some on Wall Street are side-eyeing the market’s recent exuberance. With stocks sitting at lofty levels, any hint of trouble—whether from inflation or global trade uncertainty—could test the rally’s staying power.

STOCKS
Winners & Losers

What’s up 📈

  • Super Micro Computer surged 16.47% following last week’s business update, extending its rally. ($SMCI)

  • Intel popped 16.06% after a Wall Street Journal report revealed Broadcom and TSMC are considering splitting the company in two. ($INTC)

  • Walgreens Boots Alliance jumped 14.02% on reports that its potential buyout deal with Sycamore Partners is still in play. ($WBA)

  • Bath & Body Works jumped 9.68% after JPMorgan upgraded the stock to overweight, citing strong operating margins. ($BBWI)

  • Moderna rallied 8.37%, extending Friday’s gains despite a downgrade to equal weight. ($MRNA)

  • Nike rose 6.23% after announcing a new brand collaboration with Kim Kardashian’s Skims, launching this spring. ($NKE)

  • Venture Global gained 6% after multiple Wall Street firms initiated coverage with buy ratings. ($VG)

What’s down 📉

  • Fluor fell 8.41% after missing Q4 earnings expectations and issuing weak forward guidance. ($FLR)

  • Medtronic sank 7.26% after reporting weaker-than-expected sales for the last quarter. ($MDT)

  • Conagra Brands slid 5.72% after lowering its full-year earnings guidance from $2.45 per share to $2.35. ($CAG)

  • Meta Platforms dropped 2.90%, ending a 20-day winning streak. ($META)

CHIPS
Intel Has Biggest Rally Since 2020 on Breakup Speculation

Intel just pulled off its biggest rally since 2020, with shares spiking 16% on speculation that the struggling chipmaker might get split up. Broadcom is reportedly eyeing Intel’s chip design and marketing division, while TSMC could take over its factories in a deal that would fundamentally reshape the company. The stock is now up 31% this year, but after last year’s 60% slump, investors are left wondering—is this the start of a comeback, or just another false alarm?

Breaking Up to Stay Relevant?

Intel has spent the past decade falling behind Nvidia, AMD, and TSMC, missing out on the AI chip boom while watching its once-dominant manufacturing division lose ground. A split could finally give Intel the focus it needs, with TSMC running the factories and Broadcom taking over chip development. But there’s a catch—Washington is unlikely to approve foreign control of Intel’s U.S. plants, especially after Intel scored $7.9 billion in CHIPS Act funding to revive American semiconductor production.

Wall Street’s Betting on Change

The market loved the idea, but the hurdles are massive. Even if TSMC and Broadcom move forward, regulatory scrutiny from both the U.S. and China could block a deal before it even gets started. Intel has already axed 15% of its workforce, reshuffled leadership, and spun off units like Altera, yet it's still trailing competitors. If these deals fall through, this rally could vanish just as fast as it appeared.

What’s Next?

Intel’s board is on the hunt for a new CEO, but if a breakup is on the table, whoever takes the job might be overseeing a completely different company. Meanwhile, Broadcom and TSMC haven’t even made formal offers, meaning this is still just speculation. If Intel can’t land a deal or find a clear path forward, this rally could turn into just another blip on its long, slow decline.

NEWS
Market Movements

MERGER/ACQUISITION
Bill Ackman Wants to Turn Howard Hughes Into His Own Berkshire Hathaway

Bill Ackman is doubling down on his vision to transform Howard Hughes Holdings into a modern-day Berkshire Hathaway, raising his bid to $90 per share for 10 million newly issued shares. If the deal goes through, Pershing Square would own 48% of the company, and Ackman himself would take over as chairman and CEO. The hedge fund billionaire is promising a long-term, value-driven strategy—one modeled after Warren Buffett’s empire—where Howard Hughes would acquire controlling stakes in high-quality private and public companies.

More Cash, Bigger Plans

Pershing Square is throwing $900 million into Howard Hughes, up from its previous $85-per-share offer. The deal requires no regulatory approval or shareholder vote, meaning Ackman could take the reins in a matter of weeks. The real estate firm, best known for developing master-planned communities like The Woodlands in Houston and Summerlin in Las Vegas, would remain focused on real estate while also expanding into a broader holding company model. Ackman believes that owning these developments in pro-business markets provides a strong foundation for long-term growth.

Wall Street Is Skeptical

Howard Hughes shares jumped 6.8% to $80.60 before Ackman’s announcement, only to fall nearly 5% in after-hours trading. Investors aren’t sold on the deal, partly because the company previously estimated its net asset value at $118 per share—far higher than Ackman’s $90 bid. That puts the board in a tough spot: selling at a discount could frustrate shareholders, but rejecting the offer risks missing out on Pershing Square’s capital and strategic direction.

What’s Next?

Ackman has spent years circling Howard Hughes—he previously served as chairman for over a decade before stepping down last year. Now, he’s looking to return with full control and a long-term vision. If he pulls it off, Howard Hughes could become a multi-industry holding company, much like Buffett’s Berkshire. But if the board holds out for a better price, Ackman may have to sweeten the deal—or walk away entirely.

Calendar
On The Horizon

Tomorrow

More housing data is on deck Tuesday, with fresh numbers on housing starts and building permits. These reports track how many new homes broke ground and how many got the green light for future construction. While both figures have been edging higher, completions are still lagging—so buyers waiting for more supply might need a little more patience.

Meanwhile, earnings season rolls on. Carvana ($CVNA), Analog Devices ($ADI), Fiverr ($FVRR), Imax ($IMAX), NerdWallet ($NRDS), Manchester United ($MANU), and The Cheesecake Factory ($CAKE) are all set to report, giving investors plenty to chew on.

Before Market Open:

  • Etsy has managed to hold its ground against retail giants, but its biggest challenge might be itself. The platform is staring down a hefty debt load just as its revenue growth slows—a combo that doesn’t scream confidence. Management is pushing new initiatives to keep shoppers engaged, but Wall Street isn’t sold yet, with most analysts sticking to a “hold” rating. Consensus: $0.95 EPS, $861.69 million in revenue ($ETSY).

  • Wingstop doesn’t suffer from a lack of demand. On the contrary, its expansion over the last few years has been impressive, with new franchisee locations pouring money back into the company’s coffers. The problem is supply: With chickens on the cutting block as a bout of avian flu sweeps through the US, wing prices could climb. Wingstop’s costs of goods sold have risen year-over-year for the last three straight quarters, and shareholders will want to hear a plan from management about whether the company will continue to eat price increases, or pass them on to customers. Consensus: $0.90 EPS, $165.05 million in revenue. ($WING)

NEWS
The Daily Rundown

  • ✈️ Delta Plane Flips Over After Crash Landing in Toronto: A Delta flight from Minneapolis overturned upon landing at Toronto Pearson International Airport, injuring at least 15 passengers. The aircraft, which ended up upside down in the snow, was carrying 80 people. Authorities have yet to determine the cause of the crash.

  • ⚖️ Charlie Javice Goes on Trial for Allegedly Scamming JPMorgan: The former CEO of Frank faces trial in New York over claims she inflated her company’s user base before selling it to JPMorgan for $175 million. Prosecutors allege she faked millions of accounts, while her defense argues JPMorgan failed in its due diligence. If convicted, she faces decades in prison.

  • 🛑 Musk’s DOGE Team Wants Access to IRS Taxpayer Records: Elon Musk’s Department of Government Efficiency has requested access to the IRS’s tax database, which contains financial information on U.S. individuals and businesses. The administration claims the access is needed to modernize tax operations, but privacy advocates are raising alarms. A judge has temporarily blocked DOGE from obtaining the data.

  • 🌍 U.S. and Russia Meet in Saudi Arabia for Ukraine War Talks: U.S. Secretary of State Marco Rubio is holding discussions with Russian officials in Saudi Arabia to negotiate an end to the war in Ukraine. European allies are alarmed at being left out of negotiations, while Ukraine insists it will not accept any deal it did not help broker.

  • 💰 Gold Prices Surge as Investors Rush to Move Bullion to New York: The price of gold futures in New York has hit record highs, widening the gap with London gold prices and triggering a rush to transport bullion to the U.S. Fears of Trump-imposed gold tariffs and escalating trade tensions are fueling the gold-buying frenzy.

  • ⚖️ Trump Asks Supreme Court to Reinstate His Power to Fire Agency Heads: President Trump has petitioned the Supreme Court to allow him to remove the head of the Office of Special Counsel, which protects government whistleblowers. The case is expected to set a precedent for Trump’s broader efforts to reshape the federal government.

  • 🪖 Israeli Troops Remain in Lebanon Past Agreed Withdrawal Deadline: Despite an agreed-upon deadline, Israeli military forces continue to occupy five positions in southern Lebanon. Lebanese officials have called the extended occupation a violation of the ceasefire agreement, warning that tensions could escalate if troops do not withdraw soon.

  • 🏛 Four Top NYC Officials Resign Following DOJ Decision to Drop Case Against Mayor: Four senior aides to New York City Mayor Eric Adams have resigned after the Department of Justice dropped corruption charges against him. The resignations have fueled concerns over the stability of the administration, with Governor Kathy Hochul reportedly considering an intervention.

  • ✝️ Pope Francis’ Hospitalization Extended Due to Worsening Infection: Pope Francis remains hospitalized with a severe bronchitis-related infection, and doctors have not set a discharge date. The 88-year-old pontiff’s condition has raised concerns about his ability to continue his duties.

  • 🔥 Kentucky Flooding Kills 12 as Winter Storm Wreaks Havoc: At least 12 people have died in Kentucky after severe flooding caused by a massive winter storm. Governors in Kentucky and West Virginia have declared states of emergency, and forecasters warn that dangerously cold temperatures could worsen conditions.

  • ✈️ FAA Layoffs Spark Safety Concerns After Fatal Midair Collision: The Trump administration has begun firing hundreds of Federal Aviation Administration employees, including air traffic controllers, as part of broader federal layoffs. The cuts come just weeks after a deadly midair collision near Washington, D.C., raising concerns over aviation safety.

RESOURCES
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