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  • 📉 MicroStrategy Gets Shorted

📉 MicroStrategy Gets Shorted

+ Comcast Spins Off Cable Networks

November 21, 2024

Good afternoon! The McRib is back—because, let’s face it, it never really leaves for good. Starting Dec. 3, McDonald’s will roll out its cult-favorite sandwich yet again, proving that “Farewell Tour” in 2022 was as reliable as a New Year’s resolution. But this time, the Golden Arches is sweetening—or rather, saucing—the deal. Beginning Nov. 25, you can snag a half-gallon jug of McRib sauce online for $19.99. Because nothing screams “holiday cheer” like drowning your fries, burgers, or even your Thanksgiving turkey in tangy, smoky goodness.

MARKETS

  • The Dow Jones Industrial Average climbed 461 points (1.06%), as investors ditched tech in favor of economically sensitive stocks. The S&P 500 rose 0.53%, while the Nasdaq barely budged, adding just 0.03%. Nvidia’s underwhelming earnings and Alphabet’s antitrust headlines set the tone for a tech pullback.

  • Snowflake shares exploded 33% after crushing revenue estimates, lifting peers like Salesforce and powering the Dow’s rally. Bitcoin also made waves, blowing past $98,000, while Treasury yields ticked higher, signaling optimism for growth-focused plays in an economy on the move.

STOCKS
Winners & Losers

What’s up 📈

  • Snowflake surged 32.71% after posting impressive earnings and a 28% revenue increase last quarter. The company also projected $3.43 billion in fiscal 2025 product revenue, implying 29% growth. ($SNOW)

  • Oklo jumped 20.43% after announcing its proposed acquisition of Atomic Alchemy, marking its expansion into the radioisotope market. ($OKLO)

  • Reddit gained 15.96%. ($RDDT)

  • BJ’s Wholesale Club rose 8.24% after beating third-quarter earnings estimates, raising full-year guidance, and announcing its first membership fee hike in seven years. ($BJ)

  • Cloudflare climbed 8.05%, continuing its upward momentum on better-than-expected growth in its cloud security offerings. ($NET)

  • Deere gained 8.12% after exceeding earnings expectations last quarter, despite projecting a slowdown in farming equipment demand. ($DE)

  • Merus climbed 3.3% after Goldman Sachs initiated coverage with a buy rating, citing optimism about its cancer treatments. ($MRUS)

What’s down 📉

  • PDD Holdings tumbled 10.64% after the e-commerce giant, parent to Temu, missed earnings and revenue expectations. ($PDD)

  • Coinbase fell 7.74%, reversing earlier gains tied to bitcoin's surge above $98,000, after Galaxy Digital's Michael Novogratz warned of an eventual pullback. The SEC also announced that Chair Gary Gensler will step down at the end of the year. ($COIN)

  • Baidu fell 5.90% as the Chinese tech company reported a 3% year-over-year revenue decline last quarter, despite growth in its AI cloud business. ($BIDU)

  • Alphabet slid 4.74% amid concerns that the DOJ may push for the divestiture of its Chrome browser to address monopoly claims. ($GOOGL)

CRYPTO
MicroStrategy Tumbles After Citron Research Shorts the Stock

MicroStrategy’s stock nosedived 16% Thursday, courtesy of a scathing call from Andrew Left’s Citron Research.

The once high-flying software-turned-Bitcoin hoarder got a cold shower as Citron accused it of floating far above Bitcoin fundamentals. The kicker? Citron is still bullish on Bitcoin but says MicroStrategy’s stock has become a clunky detour in a world of sleek Bitcoin ETFs.

Michael Saylor’s Bitcoin gamble turned MicroStrategy into the unofficial crypto ETF by amassing a jaw-dropping 331,200 bitcoins—worth over $31 billion. But with Bitcoin ETFs now making crypto exposure as simple as shopping on Amazon, investors might wonder if MicroStrategy’s stock is still worth the extra clicks.

From Darling to Short Target: A Citron Twist

Here’s the irony: Citron used to be one of MicroStrategy’s loudest cheerleaders during its pivot to Bitcoin back in 2020. Fast forward to today, and Citron’s short position is a sharp reality check for Saylor’s strategy.

Their main gripe? The stock’s value seems more like a speculative joyride than a sustainable business play.

Even with Bitcoin hitting a record $98,000, MicroStrategy’s reliance on hype over fundamentals has some investors tapping the brakes. Thursday’s tumble brought the company’s market cap back down to $89 billion—still hefty but a far cry from its momentary seat among the S&P 500’s big shots.

Bitcoin Boom, But at What Cost?

Sure, MicroStrategy is still up over 500% this year—thanks, Bitcoin—but that kind of surge has its skeptics. Kerrisdale Capital made a similar call earlier, shorting MicroStrategy while betting long on Bitcoin.

Their reasoning? You don’t need to ride the Saylor train when Bitcoin ETFs offer first-class seats.

Meanwhile, crypto miners like CleanSpark and Marathon Digital are picking up steam as alternative plays for Bitcoin exposure. And with President-elect Trump eyeing U.S.-only Bitcoin mining, the competition could heat up further.

NEWS
Market Movements

  • 📈 Snowflake Surges on Earnings Beat: Snowflake shares spiked 19% after the company reported better-than-expected Q3 earnings and raised its full-year guidance. The company also announced a multi-year partnership with AI startup Anthropic.

  • 🚗 Ford Plans European Job Cuts: Ford plans to reduce its European workforce by 4,000 jobs (14%) by 2027, citing weak EV demand and competition from Chinese automakers. ($F)

  • 🏩 CFPB Finalizes Payment Supervision Rule: The CFPB finalized a rule requiring digital payment giants like Apple and Google to face bank-like supervision, aimed at strengthening consumer protections. ($AAPL)

  • 🔋 Hyundai Unveils All-Electric Ioniq 9 SUV: Hyundai announced the 2026 Ioniq 9, a 3-row all-electric SUV with a 335-mile range, rapid charging, and a 4.9-second 0–60 mph time. Production will begin in Georgia in spring 2025. ($HYMTF)

  • đŸ’» Baidu Posts Mixed Q3 Results: Baidu reported a 2.6% YoY revenue drop to $4.63B due to weak advertising, but net profit rose 14% to $1.05B, with growth in AI Cloud and chatbot adoption. ($BIDU)

  • 🍔 McDonald’s Introduces 2025 McValue Platform: McDonald’s announced a 2025 "McValue" platform featuring $5 value meals and "buy one add one" deals to address affordability amid economic pressures. ($MCD)

  • 🎄 Gap CEO Optimistic on Holiday Sales: Gap's holiday season is off to a strong start, with CEO Richard Dickson raising sales and profit expectations. However, potential tariffs under the incoming Trump administration remain a concern.

  • 🛒 Alibaba Integrates E-Commerce Platforms: Alibaba is merging its domestic and international e-commerce units under a new group, appointing Fan Jiang as CEO to streamline operations. ($BABA)

ENTERTAINMENT
Comcast Spins Off Cable Networks

Comcast is putting most of its cable networks into their own sandbox, spinning them off into a new publicly traded entity called SpinCo.

The move allows NBCUniversal to focus on its shinier toys—like streaming, theme parks, and entertainment—while cord-cutting continues to gnaw at the profitability of traditional TV. This strategic reshuffle sets the stage for a more streamlined Comcast, primed to compete in high-growth areas.

Cable Castaways: What’s In and What’s Out

SpinCo will house networks like USA, MSNBC, CNBC, Oxygen, E!, Syfy, and Golf Channel, as well as digital properties like Fandango and Rotten Tomatoes. These assets brought in $7 billion over the past year but are increasingly seen as anchors in a sinking industry.

Bravo and Peacock, however, are staying put. Why? They’re integral to NBCUniversal’s growth story, with Peacock recently flexing its muscles via Olympics coverage and an 82% revenue surge last quarter.

Leadership for SpinCo is already lined up, with NBCU veteran Mark Lazarus taking the CEO reins and Anand Kini serving as CFO and COO. The new venture is being touted as "well-capitalized" and ripe for partnerships—or maybe a few mergers, given the Trump administration's expected M&A-friendly stance.

A Play for Growth, Not Nostalgia

The spin-off underscores the brutal math of the modern media landscape. Cable TV, while still profitable, lacks growth potential. Comcast’s move mirrors a broader industry shift, as rivals like Disney and Warner Bros.

Discovery weigh similar strategies but haven’t yet pulled the trigger. Meanwhile, Comcast is all-in on its forward-facing ventures, such as Peacock, which now boasts 29% more paid subscribers and is nearing profitability.

NBCUniversal isn’t just banking on streaming. Its theme park arm is preparing to debut Epic Universe in Orlando, described as the most advanced park yet. Translation: It’s full steam ahead for investments in experiences people can’t stream from their couches.

The Big Picture: Spin Now, Merge Later?

SpinCo won’t be left to fend for itself indefinitely. Comcast hinted at future acquisitions or partnerships to build scale in a fragmented cable market. With 70 million U.S. households still paying for cable, there’s value in consolidation—even if the long-term trajectory remains bleak.

For Comcast, this isn’t just about cutting loose legacy assets. It’s about unburdening its core business to take bigger swings in streaming and entertainment. As Peacock and Epic Universe gain momentum, the SpinCo experiment will test whether old-school cable can thrive—or merely survive—when left to its own devices.

Calendar
On The Horizon

Tomorrow

Earnings season is wrapping up, with only a few notable reports left to trickle in next week. Tomorrow, though? It’s looking pretty quiet on the corporate front.

Instead, all eyes will be on two economic reports: Services and Manufacturing PMI. The PMI, a monthly pulse check on U.S. businesses, surveys companies about production, inventories, and overall conditions to gauge economic health.

The services sector has been on a roll, hitting 56% last month (anything above 50% signals growth) and marking its best showing since July 2022. Manufacturing? Not so much. With a 46.5% reading, it’s stuck in a seven-month losing streak. While rate cuts could eventually revive the sector, economists are still waiting for the tide to turn.

NEWS
The Daily Rundown

  • 🍌 Duct-Taped Banana Sells for Millions: Maurizio Cattelan’s viral art piece “Comedian,” a banana taped to a wall, sold for $6.24 million at Sotheby’s. The sale reflects a potential recovery in the art market, which saw average spending drop by 32% last year. Other auction highlights included a RenĂ© Magritte masterpiece fetching $121.2 million.

  • 🏱 Musk and Ramaswamy Want Federal Workers Back in the Office: Elon Musk and Vivek Ramaswamy, co-heads of the Department of Government Efficiency, proposed a five-day in-office workweek for federal employees. They argue remote work wastes taxpayer dollars and predict noncompliance will lead to voluntary terminations.

  • ⚖ Fraud Convictions Hit Global Headlines: Adani Group’s chair Gautam Adani was charged in the U.S. for bribery linked to $250 million in solar energy contracts, while Archegos founder Bill Hwang received an 18-year prison sentence for fraud causing $10 billion in bank losses. FTX co-founder Gary Wang avoided prison for cooperating in the Sam Bankman-Fried case.

  • đŸŒ§ïž Bomb Cyclone Strikes Pacific Northwest: A hurricane-strength storm wreaked havoc across Washington State, Oregon, and Northern California, bringing heavy rainfall, blizzard warnings, and 600,000 power outages in Washington. Experts predict more rain and snow for the region in the coming days.

  • đŸ›ïž Via Monte Napoleone Crowned Most Expensive Street: Milan’s Via Monte Napoleone overtook New York’s Fifth Avenue as the world’s priciest shopping street, with rents soaring to $2,047 per square foot. A luxury tourism boom and limited retail space have fueled the surge in value. Fifth Avenue rents remain flat at $2,000 per square foot.

  • đŸŽ„ 'Rust' Premieres with Tribute to Halyna Hutchins: Alec Baldwin’s film Rust premiered at a film festival in Poland with a dedication to cinematographer Halyna Hutchins, who was fatally shot on set in 2021. The release marks a poignant tribute to her memory.

  • đŸŽ¶ Coachella 2025 Lineup Announced: Coachella unveiled its 2025 lineup featuring Lady Gaga, Post Malone, Green Day, and Travis Scott as headliners. The music festival will take place across two weekends in April in Indio, California.

RESOURCES
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