News of the Week (January 1 - 5)
Turning the Calendar; 2024 Portfolio Management Expectations; SoFi; Disney; PayPal; Amazon; SentinelOne; Alphabet; Uber; Meta; Macro; Portfolio
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1. Turning the Calendar
The first week of 2024 was certainly a volatile one. Volume returned to exchanges on Tuesday and volatility kicked back in following a tranquil end to 2023. I don’t focus on short-term price action, but I did want to discuss this phenomenon in a bit of detail and where the sharper price action came from.
In my mind, it stemmed from two places. First, 2023 was a very fun year. Most quality companies were convincingly up year to date with a few notable mega-cap standouts carrying the indexes notably higher. Fund managers without solid stakes in the “magnificent 7” (FAANG + Nvidia and Microsoft), had some explaining to do to their investors wondering why they missed the boat. This likely added buying pressure to the biggest winners through the end of the year to appease investor concerns over holdings. More buying pressure means higher prices – all else equal.
Secondly, year to date profits in 2023 mean capital gains taxes for those choosing to liquidate winning positions in the calendar year. If those positions are sold off after January 1st, investors can delay the taxation event by over a year. That is the rational decision considering that cash can safely earn you 5% in today’s environment. When combining these two factors, we are left with more incentive to bid up winners and less incentive to sell them into the New Year. The calendar turned, and those incentives reversed while seasonally light volume returned to more normal levels. You’ll likely notice that your best performers from 2023 were hit the hardest at the beginning of the week. This is likely why.
To be candid, this type of price action is not something I care about or want to manage my portfolio around (aside from delaying taxation). After all, for us long-term investors, demand and profit compounding are by far the two most important things that matter for returns. I simply think it helps to understand where the sudden price action came from. Knowledge is power.
2. 2024 Portfolio Management Expectations
2022-2023 were years in which “don’t fight the Fed” meant expressing caution when building out positions. I trimmed more readily than I’d normally like to; I kept more cash on hand than I’d normally like to; and I demanded more multiple contraction to justify adding to positions. My bias always leans towards accumulation as I consistently have new funds hitting my account. Still, that bias has been less pronounced for nearly 2 years.
Well? 2024 is the year in which “don’t fight the Fed” does a 180 in terms of meaning. Rates are peaking with cuts expected this year; quantitative tightening will likely slow as that process plays out. Hawkish policy intensity is dwindling while employment and economic activity remain quite healthy on a relative scale. That recipe is perfect for stocks. A strong economy and falling cost of capital are ideal for investing. That falling cost of capital and rate cuts should also lead to gradual multiple expansion looking ahead. Faster growth, larger rewards for that growth.
My portfolio management approach is going to get more aggressive this year. I am going to accumulate with smaller multiple contraction bands and let positions run more freely than I have been. Considering this, I’m grouping the holdings into strategic buckets, which more clearly depict the approach. When going through this, please note that I don’t use traditional multiples to determine expensive vs. cheap. I use price to profit to growth multiples to reward the pace of profit expansion. I think PEG ratios (P/E divided by multi-year earnings growth) are far superior to P/E ratios.
a. Priced Very Attractively & Fundamentally Performing
I consider Meta, Uber, Amazon, SoFi and Progyny to be in this bucket. All 5 sport forward PEG ratios around 1x or lower; all 5 consistently outperform quarterly expectations; all 5 are extremely well-run organizations. The first three are also in cost optimization mode, with profit estimates rapidly rising. I don’t think those estimates are finished rising. That’s despite the trio’s compelling pricing prior to any further upward revision. I haven’t had much of a chance to add to any in this group besides Progyny and SoFi in 2023.
Technical analysis is a small part of my process. Still, it’s a piece and all 5 holdings continue to gradually ride their moving averages higher. As someone who has the luxury to think in years and not quarters, I’d use these tools to slowly, carefully lean back in. I am willing to catch fundamentally thriving companies whose stocks are falling knives… but only very slowly and with a deep respect for my charting friends. Despite the cohort being among my largest holdings, I’d like to lean back into accumulation on all 5 if Mr. Market gives me a chance.
b. Priced Very Attractively & Fundamentally Uncertain
I consider Disney, PayPal and Match Group to be in this bucket. Like the first cohort, they all sport PEG ratios around 1x or lower. Disney needs to show me that they’re serious about solely focusing on making great content rather than influencing global culture. It needs to show me that it’s willing to behave rationally by selling part of ESPN to mega-cap tech rather than trying to go face-to face with them. The India sale is a great hint that it’s willing to do so. I loved that news. It needs to deliver on its plans for streaming to breakeven next year. These are the key events that I’m looking for from the Mouse. For PayPal, it’s as simple as seeing a convincing bottom in its transaction margin. For Match, I want to see payer growth turn positive in Q2 like we’ve been told to expect. This should easily happen as it laps price hikes. If it doesn’t, I will sell. I want to see the top of the funnel recover. I want a lack of additional blunders such as halting a successful marketing campaign. I want to see them execute across their entire app ecosystem… not just Hinge.
Match Group is on the do not add list. PayPal and Disney are on the “Mr. Market really needs to give you the deal of a lifetime to add” list (as Disney has been since I started the position). I will be more cautious with this group than the first. I will demand more multiple contraction and I will likely trim more readily into multiple expansion. All three are dominant players in their respective fields that have lost their ways to varying degrees. Why am I being so patient? The brand power, asset bases and commanding market share positions for all three put them in a great spot to right their ships. We’ll see if that can happen.
c. Fully Priced and Thriving
I consider Lululemon, CrowdStrike, Duolingo, The Trade Desk and Shopify to be in this bucket. All have been flawless performers (besides TTD’s latest quarter), share takers, consistent compounders, margin expanders and emerging titans in their respective fields. All are also quite expensive, with forward PEGs hovering around 1.5x-2x. Lululemon, Duolingo and CrowdStrike are pricey while The Trade Desk and Shopify are very pricey. But elite fundamental performance deserves a hefty premium like they’re all already getting. I don’t expect any multiple expansion here, but rapid profit compounding doesn’t need an expanding multiple to deliver strong annual returns.
So? I let all of these valuations run a bit more than others in the portfolio and will continue to do so. I will still look for significant multiple compression to lean in with bands larger than group A. I’m more comfortable with letting these names get more expensive than I am for the fundamentally fragile names.
d. Odd Balls
Nanox is on the do not touch list until commercial deliveries of its Arc hardware begin. We shall see if that ever happens. For now, I’m fine with it being such a tiny position. It could easily be a zero, but Arc is a game-changer for radiology if deployment ever can ramp.
Lemonade has actually executed flawlessly… it’s just miles from profitability. For that reason, I didn’t want to put it in group A as there is still so much to prove about the viability of its unit economics at maturity. I just can’t place it in the same breath as Meta and Amazon despite it doing everything correctly right now. I have been adding here, but with an important caveat that a “full position” in Lemonade is much smaller than a “full position” everywhere else. There’s no finite cap in mind, but I want it to be the smallest holding I have besides Nanox for now.
e. The Current Watch List
JFrog (waiting for more geopolitical certainty to hopefully re-enter)
SentinelOne (waiting for it to get closer to breakeven)
Cava (waiting for it to hopefully get cheaper)
Sweetgreen (waiting for it to establish a better track record of under-promise, over-deliver and accelerate Infinite Kitchen integration)
Dutch Bros (interested but haven’t done enough work yet)
MercadoLibre (interested but need to learn more about LatAm economics to grow comfortable enough to start a position outside of the U.S.)
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3. SoFi Technologies (SOFI) – Downgrade
Keefe, Bruyette & Woods (boutique research firm) downgraded SoFi this past week. It lowered its price target from $7.50 to $6.50. There are a few reasons for this. The first one is its recently positive stock movement leading to more downside stock risk. This is irrelevant and I don’t want to lend credence to this argument with further explanation. The other factors are what we need to focus on.
The firm sees a risk of lower fair value on incremental originations. This is due to falling rates leading to SoFi charging lower annual percent rates (APR). This entirely ignores multiple pieces of fair value measurement. It penalizes SoFi for lower APR WITHOUT rewarding future fair value for lower cost of capital and stellar loss rates. All three are variables in arriving at fair value.
Let’s dissect the APR and cost of capital pieces. SoFi has a unique FinTech edge (thanks to the charter) in its ability to use low-cost deposits for originations. This means lower cost of capital than those reliant on warehouse credit. SoFi also enjoys significant pricing power in its APR/weighted coupons. Why? Because of its excess credit demand and ultra-prime borrowers. It turns down 75% of applicants and enjoys heightened elasticity of demand from catering to the most affluent borrowers. The luxury of extreme selectivity helps too. That’s why its weighted average coupon rose faster than benchmark rates throughout 2022-2023. That’s also why its weighted average coupon will likely fall more slowly than rates during the dovish part of this cycle. So… structural cost of capital advantage and a structural weighted coupon advantage. This puts it in an ideal position, along with great loss rates, to maintain or even grow fair value of loans going forward.
There’s another vital point to cover. The fair value of loans is also based on the present value of the discounted cash flows of future repayments. As rates fall, that discounting becomes less intense. This directly props up fair value to offer more maintenance support.
The analyst also sees lower origination growth in 2024 as a risk. I agree that origination growth will slow, but not nearly as much as this firm implies in its revenue forecast. Why? Lower rates and easier monetary policy mean tighter credit spreads, better liquidity and more capital market demand. SoFi uniquely found capital market buyers at compelling gain on sale margin throughout 2022 and 2023 thanks to its pristine credit performance; it should find far more demand in 2024. That will mean more pocketed gain on sale margin, and more balance sheet flexibility to accelerate originations without approaching capital ratio minimums. It will also mean lower profit hurdle rates for capital market participants like hedge funds to clear. This could even potentially bolster its already strong gain on sale trends.
Separately, personal loan demand does fall with falling rates. That is 100% accurate. Most of this credit bucket is from refinancing variable credit to fixed rate credit. There’s little incentive to do that as rates fall. Still, that’s fully baked into leadership’s expectations of compounding revenue at 20%-25% in the years to come. Furthermore, this is exactly why SoFi being a one-stop-shop is so compelling. While falling rates hit personal lending demand, they bolster demand for student and home lending. Some will say student lending is not as attractive as personal because of the lower coupon rates. But this credit boasts significantly lower loss rates. It also comes with lower customer acquisition cost considering SoFi is the share leader here, with its brand still associated with student lending for many. For home lending, the company has gotten its tech stack and service levels to a good place right in time for the fun part of the cycle to commence. It also has a very large base of customers to cross-sell these products to, which it didn't have during the last rate cut cycle.
Next, the firm cites SoFi’s premium book value multiple. They’re not wrong here, but book value is not the best multiple for this firm. It’s not just a bank. It’s a bank, a financial wellness company and a financial API vendor. As I’ve said before, we’ve had to use EBITDA in the past due to a lack of GAAP net income. Well? That GAAP net income is coming. Even if it ramps a bit more slowly than I think it will, the firm’s forward PEG is solidly below 1x. That is not expensive.
The analyst calls out risks to SoFi meeting its path to profits. Considering the team’s perfect track record of under-promise, over-deliver, this would mark a sharp break from current trends. The team gave zero indication of risks to Q4 guidance or 2024 profit guidance during its shareholder Q&A on December 4th. That was about 70% of the way through its calendar quarter.
Finally, the analyst has 2024 revenue estimates a full 9% below consensus. We now have nearly 3 years of SoFi effectively setting street expectations to be comfortably surpassed. I don’t find it realistic to think that as the backdrop gets easier, that trend will suddenly halt. It would be like expecting Mike Trout to only be good against major league pitching and to suddenly stink against minor leaguers. But let’s entertain this thought for a second.
Assume that lending remains around 68% of total revenue for 2023 and that it does $1.41 billion from that segment for the year. Then pessimistically assume 0% lending growth in 2024 despite easier policy, ramping home lending and the expectation to grow originations next year. To get to the firm’s $2.3 billion 2024 revenue estimate, the other two segments would need to grow to $890 million. Assume the company falls short on its objective to accelerate the tech platform to mid-teens growth in 2024 and only delivers 10% growth. That means about $405 million in tech platform revenue for 2024. That means financial services would need to contribute $485 million for 2024. That represents a slowing of revenue growth from 188% to 62% as the backdrop gets immensely easier for these products. Again, this assumes disappointment from its other two segments which is not what I expect. Yeah… I’ll take the over.
There are clearly risks to the bull case. Stock volatility and fair value risk as rates fall are not pressing risks in my view. Fair value was more vulnerable as rates rose, yet SoFi’s coupon elasticity of demand prevented that risk from coming to fruition. I expect a great Q4 and upbeat 2024 guidance. I could always be wrong.
4. Walt Disney (DIS) – Activist & Sentiment
Disney and activist investor ValueAct Capital have settled their disputes. Disney has agreed to more closely communicate and share info while providing more access to its board and executives for consultation. ValueAct, in exchange, will support Disney’s desired board structure. While more details weren’t shared, it’s likely a shareholder positive that Disney made concessions to ValueAct to get this done. I’m speculating, but it’s not at all a stretch and is intuitive if anything. This comes as Blackwells Capital (a third activist) just nominated 3 board members of its own in support of Iger’s turnaround. ValueAct and Blackwells are considered friendly activist allies. Disney wanted support from both to strengthen its fight against Trian and Nelson Peltz (not a friendly activist). Blackwells wrote a pretty scathing criticism of Trian and Peltz in their announcement. In it, they essentially called him and his nominees unqualified distractions.
Why does all of this matter? The obvious reason is that all 3 firms are shareholder friends and fixated on driving returns. Disney may not like Nelson Peltz, but I (as a shareholder) have no issues with what he wants. (LINK)
Secondly, it offers a clear hint of just how compelling Disney’s base of assets truly is. The firm would not be getting this much attention if that were not the case. To me, that reality offers a compelling shareholder value floor if Iger can’t turn things around. Disney can just sell off these assets at an aggregate price tag well north of the $90 its shares trade at today. ValueAct thinks the Parks and Experiences business is worth roughly that on its own. I truly don’t care who wins this fight. I view it as a positive regardless as it shines the spotlight on this team to make sure they’re executing and behaving.
A quote from Sharmeen Obaid-Chinoy (director of the 2026 Star Wars film) virally made its way around Twitter this past week. She said one of her goals for the production was to “make men uncomfortable.” This was treated as breaking news and shared as such across media outlets and large accounts. What context was missing? Maybe the fact that the quote is a decade old… that might be just a tad important. This is just another example of Twitter not being the place to gauge Disney sentiment. It is filled with Elon Musk’s army, which is an army that has been told by its leader that Disney is a woke adversary. Elon good, Disney bad… that is the mentality on that platform.
This week, she also said that it’s time for a woman to shape the Star Wars storyline. Some took issue with that, but I don’t. Who cares if it’s a woman or a man or an otter shaping the story line? I care about that story telling being well received and the film being very profitable. Based on her being the only director ever to win 2 academy awards before the age of 37, she’s qualified to do just that. Finally, as I’ve said in the past, I view Disney as more of a rental than any other holding. I’ll likely (hopefully) be out of this position as it’s more fairly valued before 2026.
c. More News
Disney and Reliance have commenced antitrust work to get the potential majority stake acquisition done. This is good news.
Disney inked a new 8 year deal with the NCAA for a plethora of college sports rights. It will cost the firm $115 million per year and include 40 NCAA championship events with international rights to March Madness. Broken record alert: Partner with mega-cap tech to unleash significantly more bidding power for more content. Disney can’t win these auctions forever without doing just that. I’m glad they’re selling a majority stake in the India business. Time to sell part of ESPN and hopefully ABC too. I’ll keep saying it.
5. PayPal (PYPL) – Q4 and 2024
I posted something very similar to this across my social media accounts this week. If you read it, this will sound familiar, but with a bit more detail.
There has been much excitement surrounding Alex Chriss and a new era of PayPal leadership. I think some of that excitement is warranted. He has a clear track record of driving profitable growth with very relevant offerings at Intuit. He spearheaded the small and medium business (SMB) segment that makes up the largest chunk of that firm. As we’ve covered extensively, SMB expansion for private label checkout is perhaps the most important margin lever that PayPal has to pull. His track record is quite fitting and the early changes he has made (like selling Happy Returns) show me that his head is in the right place.
But? The turnaround here will not be immediate. It will not resemble a late 2022 Meta Platforms. There is more to fix and longer time to value on the fixes. Meta is the exception to the rule (thank you Zuck). Paypal’s operation "Quantum Leap" will likely be more of a brisk walk. Faster innovation and retrofitting antiquated tech at giant scale do not happen overnight. Branded checkout needs to be even with the Shopify’s (Shop Pay) of the world. I already see that happening with slick, 2-click checkout on partner sites like United Airlines, but more work is needed.
Onboarding a few merchants to the latest checkout product per quarter is far too slow. Shopify can snap its fingers to onboard. PayPal must go faster… but how? Infrastructure needs to be strengthened so that PayPal can not only accelerate the integration of this latest flow... but guarantee that the next flow's integration takes weeks, not years. Under Schulman, the firm had gotten to a point of finally wrapping up integration just in time for the latest version to go live. That does not work. This isn't about making a few tweaks... it's about rebuilding an entire foundation to ensure PayPal innovation can morph from a sloth to a jaguar in the years ahead. Again, that takes time.
Value add services on the Braintree side need to be rapidly introduced to bring that product up to speed with Adyen & Stripe. That’s the main priority under Quantum Leap; Chriss has direct experience and success in layering on related high margins services at Intuit. Rounding out Braintree’s offering with fraud, FX, and chargeback services is the only way it can compete on anything other than price. Yes, Braintree can be a compelling loss leader for driving better branded placement & share. But why not make it a profit leader with software add-ons? That's the plan... & that plan will also take time. Chriss won't chase unprofitable revenue or account growth like Schulman did.
So? All of this is to say that I don't see excitement manifesting in rapid progress when it reports Q4 earnings. I see transaction margin again falling Q/Q & Wall Street fixating on that number. Temu cross-border & BNPL will both help, but they're smaller pieces of the puzzle with branded share & private label margin expansion being the 2 keys. 2024 will have to be the year that PayPal sheds its impending dinosaur status & morphs back into the FinTech innovation titan it had once been.
Macro headwinds shifting to tailwinds will help mightily, but at the very least, it must maintain its branded checkout share or even grow it for this to work. This must happen while Braintree and Venmo margins expand. Without all of this, 2024 profit growth driven by cost cutting alone is not an enduring strategy. While there’s likely more to do on the cost cutting side (likely more layoffs, unfortunately), that can only bolster the bottom line for so long. Growth, growth, growth.
The potential is there. The CEO is now there. The talent has always been there (yet handcuffed by PayPal’s plumbing). The balance sheet to invest is there & then some. The metric leads within checkout give it a clear right to win. Its unmatched brand awareness & trust mean it doesn't need to be better than the rest... up to par will do just fine. Paypal has been a case of leadership doing whatever it can to stand in the way of success. Alex Chriss is the man to get out of the way. He's the leader to unleash this juggernaut representing well over $1T in annual volume. As we move further into 2024, I think that will be clear. If it doesn’t, that will likely mean my positive view of him is misplaced. For Q4 2023, I expect very, very little.
PayPal caught a couple downgrades this week on heightened executional uncertainty. This is extremely fair. There is a lot to prove. The stock responded positively to both downgrades to add credence to a “bad news bottom” scenario. The worst could likely be priced in.
6. Amazon (AMZN) – More Upgrades
DA Davidson’s sell side analyst must read my newsletter. He upgraded shares this past week. It was based on two things. First, is optimism surrounding an AWS growth bottom and Amazon’s compelling GenAI product suite. We are just a handful of months removed from Wall Street thinking Azure would leave AWS behind in the GenAI dust. I said not so fast then. I’ll say not so fast today while the rest of the analyst community hops aboard.
The second reason for optimism is more expected commerce share gains across the globe. These gains will likely be more pronounced outside of North America (its most mature market by far), but the sell-sider still sees more commerce share gains here too. Its unparalleled Prime subscription, unmatched delivery times and wildly broad product offering all put it in the best position to keep winning. And as we’ve discussed in detail, its regional fulfillment overhaul, its supply chain as a service offering, Buy with Prime, flexible courier program etc. are all margin levers it is pulling to make sure growth is margin accretive.
Separately, Bank of America sees margin outperformance in 2024 thanks to advertising. Who could have possibly guessed? More of the same for this wonderfully boring executor and uniquely easy investment.
7. SentinelOne (S) – M&A & Contemplating
SentinelOne announced its intent to acquire PingSafe. This will add a Cloud Native App Protection Platform (CNAPP) offering to join SentinelOne’s budding cloud workload and data protection products. PingSafe’s CNAPP will be used to tie all of these pieces together. This was a needed purchase to round out its cloud security suite to better compete with CrowdStrike and Palo Alto. SentinelOne had been more of a point solution vendor within cloud security specifically. This allows it to market itself as a platform play outside of solely endpoint security (where it’s clearly a platform play already).
SentinelOne is a very interesting story. It’s much smaller than CrowdStrike, cheaper based on gross profit multiples, and far behind in terms of EBIT and FCF leverage. The two companies are roughly the same age. Its growth rates are already slowing a lot more quickly than CrowdStrike’s did, but that’s not really a deal-breaker. CrowdStrike is 1 of 1 in terms of scaled growth and profit. It doesn't need to be CrowdStrike.
There’s a lot of margin expansion extrapolating to do here to get excited about this investment. If it can deliver on that margin expansion (and there’s a strong trend pointing to that happening) this really can work. That assumed progress would likely be rewarded with gross profit multiple expansion while brisk revenue growth adds to potential returns. Personally, I’m much more comfortable in CrowdStrike (current holding) than SentinelOne.
Still, I do see a very large potential reward for those willing to take the heightened risk associated with SentinelOne. It admirably and expediently corrected some executional blunders a few quarters ago. That matters a lot to me. It doesn’t have the balance sheet of CrowdStrike or Palo Alto. It doesn’t (quite yet) have the product breadth either. Furthermore, Falcon Go (CrowdStrike’s small business bundle) is enjoying great traction within SentinelOne’s core small business niche.
All of this is to say that there are considerable risks. But the security market is still very fragmented, still roughly 50% controlled by legacy players and still ripe for more disruption. It’s clear that CrowdStrike and Palo Alto will be poised to sharply benefit. SentinelOne could very well be too. I’ve added this name to my watch list. I’d like to see it get closer to EBIT breakeven to grow comfortable enough with potentially starting a new position. I’d love to own more of the cybersecurity market.
8. Market Headlines
Google (GOOGL) plans to cut another 30,000 (about 17% of headcount) jobs in 2024 based on GenAI automation and efficiency gains. Two things are true: First, this is very unfortunate for those involved. Regardless of how strong the job market is, getting fired is never fun. Secondly, this could impact margin ceilings for those best able to take advantage of this innovation. If you can be as productive with 150,000 people instead of 180,000, that could easily mean another $3-$4 billion flowing down the income statement to the bottom line. Google, Amazon, Microsoft, Meta, Salesforce and many, many others should enjoy this kind of GenAI-based cost optimization.
Uber (UBER) continues to get more love from the Street. Nomura cut Lyft targets based on shrinking market share (so rising Uber market share). Wedbush’s Dan Ives is also quite upbeat about Uber, but not Lyft. Best in class driver supply fees and wait times, best in class consumer network, best in class product breadth/subscription, best in class cost of capital, best in class margins and best in class balance sheet for the win. Uber is best in class. The valedictorian, if you will.
Meta Platforms (META) saw news swirl this week about Zuckerberg selling about $500 million in stock recently. What a big number. What did all of these disclosures conveniently avoid sharing? That the sales were all options being exercised and that they represent a tiny fraction of his overall equity. That context just doesn’t get as many clicks as “$500 million.”
The Manufacturing Purchasing Managers Index (PMI) for December came in at 47.9. This compares to 48.2 expected and 49.4 last month.
The Institute of Supply Management (ISM) PMI came in at 47.4. This compares to 47.1 expected and 46.7 last month.
The ISM Manufacturing Prices reading for December came in at 45.2. This compares to 47.5 expected and 49.9 last month.
S&P Global Composite PMI for December came in at 50.9. This compares to 51 expected and 50.7 last month.
Services PMI for December came in at 51.4. This compares to 51.3 expected and 50.8 last month.
ISM Non-Manufacturing PMI for December came in at 50.6. This compares to 52.6 expected and 52.7 last month.
ISM Non-Manufacturing Prices for December came in at 57.4. This compares to 57.3 expected and 58.3 last month.
ISM Non-Manufacturing Employment for December came in at 43.3. This compares to 51.0 expected and 50.7 last month.
JOLTs Job Openings for November were 8.79 million. This compares to 8.85 million expected and 8.85 million last month.
Non-farm payrolls for December came in at 216,000. This compares to 170,000 expected and 173,000 last month. This will likely be revised lower like most 2023 readings were. There is also a lot of strength in part-time and multiple-job-holder data with more weakness in full-time employment.
The labor force participation rate came in at 62.5%. This compares to 62.8% expected and 62.8% last month.
Unemployment came in at 3.7%. This compares to 3.8% expected and 3.7% last month.
Inflation & Monetary Policy Data:
The Fed minutes were dovish, but not as dovish as Powell was in his last presser. It would be difficult to be more dovish than that at this economic stage.
ADP Nonfarm Employment for December was 164,000. This compares to 115,000 expected and 101,000 last month.
Initial Jobless Claims came in at 202,000. This compares to 216,000 expected and 220,000 last month.
Average Hourly Earnings M/M for December rose 0.4%. This compares to 0.3% expected and 0.4% latest month.
As I’ve announced, my portfolio is no longer visible on Savvy Trader as of this week. I did not want to charge $50 per month for access to my portfolio, and that is now required. I will continue to share transactions on Twitter and my portfolio every single week. I was able to keep the portfolio there (in private) so that I didn’t lose all of the return data and coul keep using those screenshots.
I made no transactions this week.