The numbers don’t lie. Since 2010, stocks have tended to do rather well – averaging an 18.3% return in the 12 months after a split, compared to the S&P 500’s rather pedestrian 13.3%. Which is…interesting. But here’s the kicker: Booking Holdings (BKNG 0.72%) just announced a 25-for-1 split, and the stock’s down 5% since. Five percent! It’s practically begging for someone to take a look. And, naturally, I obliged. Don’t judge me.
Here’s the thing. That $186 million? It wasn’t exactly a windfall. More of a…reallocation of funds. A pre-approved slice of a larger, $990 million Pentagon deal from earlier this year. Think of it as the Army finally deciding which flavour of drone they wanted. They always had the money set aside. It’s not like someone suddenly found a spare $186 million under the sofa cushions. AeroVironment’s Brian Young, VP of Loitering Munitions (a fantastic job title, by the way), called it a “confirmation of confidence.” Which, translated from corporate-speak, means “we’re still in the running.” It doesn’t actually add anything to the future bottom line. It’s…sustaining, shall we say?
The catalyst is not difficult to discern. Fifty-three weeks ago, Celsius announced the acquisition of Alani Nu. A price of $1.65 billion. At the time, Celsius was experiencing a decline in sales, its third consecutive quarter. Alani Nu offered a smaller, but potentially ascending, brand, aimed at a distinct demographic. The transaction, viewed charitably, was a gamble on arrested decline.
The initial missive arrived late yesterday, detailing the intention to issue $1 billion in new shares, with the potential for an additional $1.15 billion contingent upon the underwriters’ exercise of overallotment options. This morning, the offering has… expanded. It is not a growth, precisely, but an unfolding, like a bureaucratic document endlessly replicating itself.
The S&P 500, that meticulously constructed garden of American ambition, had for years been dominated by the so-called Magnificent Seven, those towering sunflowers that absorbed all the light and left little for the rest. Now, a curious thing was happening. The energy stocks, rough and unpolished like river stones, were beginning to gleam. The materials companies, solid and enduring as ancient mountains, were stirring from their slumber. And the consumer staples, those quiet providers of daily bread, were quietly accumulating strength. Diversification, a forgotten virtue in the age of concentrated wealth, was tentatively being rewarded, like a long-lost relative returning home.
However, and this is where things get interesting, it hasn’t exactly set the market alight. A total return of 86% over the last decade (as of February 24th) is… respectable, in the same way a slightly damp squirrel is respectable. Compared to the S&P 500’s rather exuberant 300%, it’s more a gentle amble than a sprint. So, the question isn’t just where will Ford be in ten years, but what will it be, and will it still recognise itself?
Netflix (NFLX) elected to terminate discussions following Paramount Skydance’s (PSKY) higher bid – reportedly $31 per share, exceeding Netflix’s offer of $27.75 – for the entirety of Warner Bros. Discovery’s assets, encompassing CNN, TBS, TNT, and associated studios. While a protracted bidding war might appear indicative of ambition, the decision to abstain, even after being granted an opportunity to counter, speaks to a calculated assessment of value and potential return on investment.
She, this Wood, publishes daily a record of her transactions, a transparency that invites both admiration and scrutiny. And it is in these recent movements that one detects a pattern, a reaching for value amidst the prevailing uncertainty. She has, it seems, determined to add to her holdings in Amazon, Baidu, and Nu Holdings – companies each bearing its own burdens and promises. Let us consider these choices, not merely as trades, but as reflections of a larger reckoning.
Indeed, the summer months witnessed a prosperity so pronounced, it bordered upon the imprudent. A doubling of its value within a twelvemonth, and a tripling within two years, is a circumstance which invariably invites a corrective measure. And corrective it has been, with a decline in recent weeks that has caused no little consternation amongst those who deemed its ascent perpetual. This downturn, however, is not merely a matter of profit and loss; it is a demonstration of the market’s delicate sensibilities, its aversion to anything resembling unchecked ambition.
Let’s break down the carnage, shall we? Because the numbers, when you actually look at them, tell a far more interesting story than the headline. Gross Merchandise Volume up 35%. Unique Active Buyers – a solid 24% increase. Total Payment Volume leaping 42%. Fintech Monthly Active Users up 27%. They’re building an ecosystem, a goddamn digital nation in Latin America, and the analysts are whining about a temporary dip in profitability. The sheer AUDACITY.