To The Moon

Public Holidays

There will be no public holidays in China, Hong Kong, and Singapore next week.

Martin Luther King Holiday - Monday, January 17, 2022 - No ...

On 20 Jan 2025 (Monday), the USA celebrates Martin Luther King, Jr. Day.

Economic Calendar (20Jan2025)

Notable Highlights

• S&P Global Manufacturing PMI reveals the contraction or growth of global manufacturing - which reveals anticipated demand. S&P Global Services PMI will also be released. A figure above 50 reveals growth and a figure lesser than that reveals contraction.

• Existing home sales let us in about the home real estate market. With the LA fire, we are expecting some increase in demand for homes in the coming weeks.

• Initial jobless claims will be announced. The Federal Reserve uses this as one of the key macro data references as it balances inflation and employment in the economy.

• Crude Oil Inventories can be seen as forward indicators of market demand and consumption. If the trend of excess inventories continues, demand erosion can lead to reduced production & weakening consumer spending.

Earnings Calendar (20Jan2025)

I am interested in these earnings in the coming week - Netflix, Verizon, Charles Schwab, United, P&G and Johnson & Johnson.

Let us look at Netflix.

The stock price grew 77.7% from a year ago.

From Technical Analysis, the rating of the stock is “Neutral”.

From Analysts’ Sentiment, the rating of the stock is “Buy”. The price target is $873.81 which has an upside of 1.83%

Observations of recent performance:

• Revenue grew from $5.5B (2014) to $33.7B (2023)

• Operating profit from $1.7B (2014) to $6.9B (2023)

• EPS grew from $0.62 (2014) to $12.03 (2023)

• The P/E ratio is 46.6 which seems less affordable.

• The 10-year CAGR for Revenue, Assets, FCF & EPS is 22.7%, 24.6%, 66.0% and 46.7% respectively.

Recent news about Netflix

Netflix’s offering of sports is expected to boost the revenue of Netflix.

The forecast EPS and Revenue are $4.20 and $10.13B for the coming earnings, respectively.

Market Outlook of S&P500 - 20Jan2025 > what 25 indicators say

Observations:

• The MACD indicator is showing an uptrend with a recent bottom crossover.

• Moving Averages (MA). Both the MA50 line and the MA200 line are on an uptrend. The last candle is above both the MA50 line and the MA200 line. This implies a bullish outlook for both the mid-and long-term.

• The 3 Exponential Moving Averages (EMA) lines are about to converge, implying a coming reversal to an uptrend.

• Chaikin’s Monetary flow (CMF) shows a downtrend.

S&P500 has gained 23.9% from a year ago. Based on Technical (daily intervals), investing is recommending a “Strong Buy” rating.

From the above, there are 17 indicators with a “Buy” rating whereas there are 3 indicators with a “Sell” rating. This results in a “Strong Buy” rating from investing.

We should take note that there are also a few indicators signalling “overbought” - that suggest some selling in the coming days.

Based on the latest candlestick, it seems to point to a bullish outlook.

From the above, the S&P500 is likely to rise in the coming days.

News and my thoughts from last week (20Jan2025)

Going green is not the problem. It is about a sustainable & successful transition.

The mess left by the current administration would be revealed in a few days. The misery can compound as there is no more room to hide. Let us learn and move on.

CHAMATH: DID THE US DETERMINE THAT TIKTOK IS A SPYWARE? “The Supreme Court unanimously upholds a TikTok ban that was passed by a large bipartisan majority. I’ll say the quiet part out loud: The only way both of these outlier events could have happened is if the US determined that TikTok was spyware for a foreign actor.”

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US full-time jobs have dropped over the last 18 months: Full-time jobs in the US have declined by 1.26 MILLION since June 2023. Over the last 3 years, they have barely increased. Excluding government, jobs have declined by nearly 2 MILLION. Quality of jobs has deteriorated. - X user Global Markets Investor

TREASURY FINDS $31M IN SOCIAL SECURITY PAYMENTS TO DEAD PEOPLE, CALLS IT 'TIP OF ICEBERG' Government discovers millions in payments to deceased recipients after getting access to Social Security's death records. Officials project $215M more to recover by 2026, but need permanent access to stop the payments. Turns out stopping checks to dead people saves money - who knew? Source: Associated Press

40% of Millenials said it’s important to have visible signs of wealth, whether it be purchasing a fancy car, clothing, or place to live, per Wells Fargo. By comparison, just 21% of Gen Xers, 8% of baby boomers, and 7% of the silent generation feel the same. - X user Unusual Whales

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Gen Z is spending much less on alcohol than any other generation, per US Bureau of Labor Statistics. - X user Unusual Whales

I just spoke to Chairman Xi Jinping of China. The call was a very good one for both China and the U.S.A. It is my expectation that we will solve many problems together, and starting immediately. We discussed balancing Trade, Fentanyl, TikTok, and many other subjects. President Xi and I will do everything possible to make the World more peaceful and safe! Donald Trump Truth Social 09:28 AM EST 01/17/25

Coming to tariffs, China has been respectful but they will not be weak. China prefers to work together instead of working against one another. The world is big enough for all. China has no intent to replace the USA as the #1 power.’

The Los Angeles real estate market needs to be investigated: Some landlords have raised rent prices by as much as 600%+ AFTER the LA wildfires began. By law, landlords cannot raise rent prices by more than 10% during a state of emergency. - X user The Kobeissi Letter

Home insurance carriers began withdrawing new coverage in response to the rising threat from wildfires, while also increasing premium amounts for existing customers. Is this inflationary? - NBC news

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Mortgage demand in the US has fallen to its lowest level since 1995, according to Reventure. Since the peak seen less than 4 years ago, US mortgage applications are down a MASSIVE -63%. Homebuyers are officially giving up. - X user The Kobeissi Letter

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The annual income needed to buy the median-value home in the US risen to a record $109,564. This value has DOUBLED in just 4 years. Currently, the median US household income is $83,431, or $26,133 less than required. - X user the Kobeissi Letter

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The most recent data for December 2024 is out. The US govt had total revenue (taxes, fees, tariffs) of $454 billion. The US govt paid $140 billion in interest on the national debt. 31% of all govt revenue was consumed by interest payments on the debt. It is actually worse than that. The money revenue and payments for things like social security push up the revenue number, but it is all out the door to recipients right away. If you ignore the social security and unemployment insurance money, the US govt had $317 billion in revenue and paid $140 billion in interest on the national debt. About 44% of all revenue went to interest. - X user Wall Street Mav

Chipmakers cut investment plans by $9.5bn on smartphone, EV slump - Asia Nikkei

Europe's chip ambitions falter: STMicroelectronics, GF shelve fab plans, turn to China How can Europe attract chip makers? Are there plans for chip sourcing? - Digitimes

Among Burry’s latest picks revealed in Scion Asset Management’s third-quarter 13F filing, JD.com stands out as a "Strong Buy" stock poised for significant gains in 2025. As China’s second-largest e-commerce player, JD has built an ecosystem that combines logistics excellence with a robust technological foundation, setting it apart from competitors. - Barchart

Jamie Dimon says "Bitcoin itself has no intrinsic value... I just don't feel great about Bitcoin." He compares the ability to buy and sell #Bitcoin to the right to smoke. "But I just don't think you should smoke," he adds (on Sunday Morning)

Criminals are typically early adopters of innovation and technology. Time to turn things around?

My Investing Muse (20Jan2025)

Layoffs & Closure news

• Citigroup plans to cut 20,000 jobs by the end of 2026. - The Straits Times

• Angie’s Transportation and STL Equipment Leasing cite freight market challenges in bankruptcy filings - FreightWaves

• META IS PLANNING TO CUT 5% OF LOWEST PERFORMERS, MEMO SHOWS - X user Investing

• Walgreens will now close 12 more stores in San Francisco. How much more self-inflicted abuse will Californians absorb before they demand change? - X user Charlie Kirk

The above are some snippets of news about layoffs, and closures in the past week.

Supply Chain gains from disruptions

Supply Chain benefits from the shipping disruptions "Cosco says shipping disruptions boosted 2024 net profit by 95%" - Yahoo Finance (FreightWaves)

With peace coming to the Middle East, the Supply Chain industry is likely to benefit & suffer from this. The shipping lead times should be reduced and the shipping costs should drop to pre (Red Sea) crisis levels.

Freight volumes captured by the Cass Freight Index fell 7.3% from November and were off 6.5% year over year. Even excluding the typical November-to-December seasonal dip, the index was off 3.1%, which wiped away November’s 2.8% sequential gain. This was the largest y/y decline for the shipments index since January 2024 and the lowest index reading since June 2020. - Yahoo Finance

When peace comes, the shipping sector should see a drop in revenue. Peace is not always good news for all industries.

My final thoughts

Consumer Watchdog estimates home insurance rates could increase by as much as 40% to 50% as a result. - Yahoo News article

One of the “collateral” costs will be the increase in insurance premiums that affect the whole country (beyond Los Angeles).

Charlie Munger Said His Family Only Owns 3 Stocks – 'Damn Right' They're Rich Because Diversification Is For 'Know-Nothing Investors' - Benzinga

The above has left me in thought as I hold stocks from many companies in my portfolio. Is such diversification getting me adequate returns?

My goals for 2025 are to learn, connect and create value. I look forward to more sharing and learning together.

@TigerStars

$Netflix(NFLX)$

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