Hey Snackers,
2020 has officially reached Stress Level Elephant. A Polish zoo is giving its stressed elephants CBD oil to see if it calms them. Hopefully the elephants won't have to post a sponsored Insta in exchange (#CBDumbo, #FunkInTheTrunk).
The S&P 500 and the techy Nasdaq hit fresh all-time highs last week, notching their 5th straight week of gains. The Dow finally turned positive for the year.
On the pod: Gap sold $130M in facemasks last quarter, but its Lululemon-like athleisure brand was the real star. Tune into our 15-minute pod to hear why Athleta is Gap's only hope.
The Great Slicing: Tesla and Apple split their stocks into smaller slices today
Don't panic... At first glance, it might seem like your Apple holding just lost 75% of its value. Not the kind of thing we like to wake up to on a Monday. Rub the sleep out of your eyes, chug a Nespresso, and perk up: you still hold the same amount of Fruit — it just got chopped into tinier slices (so did your Tesla Model 3).
- Apple did a 4-for-1 stock split today. If you own 1 Apple share trading at $500, you'll suddenly find yourself with 4 $125 shares. Same value, more shares.
- Tesla did a 5-for-1 stock split today. If you own 1 Tesla share trading at $2.2K, you'll get 5 $440 shares. The value of your ownership in Elon's electric baby doesn't change.
What's wrong with a fat pizza slice?... Apple and Tesla think it's too caloric for investors to swallow. Companies with soaring stocks sometimes slice them into smaller pieces to make shares cheaper for retail investors (like us) to buy. Apple's stock price would be waaayy higher today if it hadn't done five stock splits since 1987 — Apple splits so hard, it's more like Banana.
- Apple stock has more than 5X'd since its last split in 2014, from $90 in June 2014 to $300 in January 2020 to ~$500 today.
- Tesla stock has soared nearly 900% in just a year, from $225 on August 30th, 2019 to $2.2K on August 30th, 2020. Today's split is Tesla's 1st ever.
- TLDR: In July, Apple became the most valuable company on Earth while Tesla became the most valuable carmaker, all thanks to their soaring stocks.
Stock splits aren't that impactful anymore... now that fractional shares are becoming widely available at brokerages. Fractional shares take affordability much further than splits. If a stock costs $1K, you can buy 1/2, 1/10th, or even 1/300th of it — you choose the dollar amount or share amount. But splits aren't entirely useless: they suggest that a company is confident about its stock's continued growth. In July, Tesla posted its 1st full-year of profit and Apple had its strongest 2nd quarter ever.
Who's up...
Don't try to validate it... Pedialyte-maker Abbott Labs got FDA emergency use authorization for its 15-minute $5 COVID test (that looks like a parking ticket). Shortly after, the Trump admin awarded Abbott $760M to deliver 150M tests in 2020 — Abbot stock soared on the double-whammy. Doctors and school nurses can use the test to quickly deliver results via nasal swab. Abbot's also launching an app that gives COVID-free people a “digital health pass.” This quick, low-cost testing method could be key in slowing the spread.
Time to choose a ship name... Walsoft or Micromart? Walmart unexpectedly teamed up with Microsoft in the race to buy TikTok's US operations. The Chinese-owned video app will be banned in the US on September 15 unless an American company strikes a deal to acquire it. Walmart and Microsoft shares jumped — investors think the Walsoft tag-team gives them a better shot against TikTok's other biggest suitor, Oracle. But now TikTok's parent Bytedance might need the Chinese government's approval to sell, complicating the deal.
...and who's down
Game off... DraftKings stock plunged 7% after it got downgraded by a Morgan Stanley analyst on Thursday. Last month, the sport betting company's stock plunged on COVID-related MLB game cancellations. That made investors realize how fragile the live events situation is. Now there's concern that the upcoming NFL season could be canceled if players test COVID-positive. Since DraftKings' main biz revolves around live sports betting, it's in a rough spot.
All I need in this life of sin... is me and my sweatpants. Nordstrom’s sales plunged 53% last quarter since you weren't going wedding and Bar Mitzvah shopping. Stores were shut for half the quarter, and Nordie posted a $255M loss (compared to a $141M profit last year). Nordstrom was forced to heavily discount unsold racks of clothes to make them more sellable. But the stock popped on upbeat statements from execs going into the holiday season.
What else we’re Snackin’
- Connect: Visualizing the social media universe in 2020 — the "Zuckerberg cluster" boasts over 2.6B monthly active users.
- Wonder: Take a tour of the stellar neighborhood with this interactive 3D visualization (don't forget sunglasses).
- Live: 6 life tips from a Japanese doctor who lived to 105 — create big arcs, not small scribbles.
- Socialize: If you're secretly sick of virtual happy hours, suggest these 5 non-awkward activities instead.
- Sweat: 7 simple exercises to build and maintain physical strength (with GIFs to demonstrate).
- Explore: The best in-state road trips in the US with itineraries, just in time for Labor Day weekend (FYI: September 4-7).
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This Week
- Monday: Earnings expected from Zoom
- Tuesday: Earnings expected from Jamf
- Wednesday: Earnings expected from Rocket Companies, Macy's, and MongoDB
- Thursday: Weekly jobless claims. Earnings expected from DocuSign and Campbell Soup
- Friday: The big August jobs report.
Disclosure: Authors of this Snacks own shares of Lululemon and Apple
ID: 1317453