Hey Snackers,
If you, like us, have coveted the version of Coca-Cola available in Mexico made with sugar over corn syrup, rejoice: President Trump has said that the soda maker is going to start using “REAL Cane Sugar” in the US version soon. Coca-Cola has yet to confirm, but the announcement has already sent shares of one company lower. Some believe that cane sugar is healthier than corn syrup, which may be the “MAHA” motivation behind the push. On the other hand, the FDA just decided after years of deliberation that Juul can market its e-cigarettes in the US. Last we checked, cigarettes, whether in traditional or vape form, aren’t considered a healthy choice.Â
Better-than-expected retail sales for June and robust Q2 earnings propelled major indexes to record closing highs on Thursday. The S&P 500 rose 0.5%, the Nasdaq 100 gained 0.7%, and the Russell 2000 led the way with a 1.2% advance. The day’s gains were led in part by Albemarle, which jumped 7.6% after Chinese mining giant Zangge ordered a surprise halt on lithium production.
🍟 How well do you know your fast food? Take our Snacks Seven Quiz and find out. Griddle me this:Â
Which fast-food chain has outperformed Microsoft?
Architect of the 91% rally in Opendoor reveals his plan to make it the “next Carvana”
When Eric Jackson was bullish on Carvana back in June 2023, with the used car seller down from a peak of $377 to trade at $25, nobody cared. After that stock’s comeback to trading above $350, a lot more people are listening to what he has to say.
His latest campaign? A company called Opendoor Technologies, an online real estate company, which he argues is poised to trade north of $80 within a few years despite being worth only about $1.66 at close yesterday. Still, retail enthusiasm around the stock has sent its price shooting up lately.Â
Volumes traded in Opendoor hit a record on Wednesday amid its 43% rally, which took the stock to $1.49 and brought this week’s gains up to 111.8% though yesterday.
Call volumes have hit records in back-to-back sessions, with a whopping 626,765 changing hands on Thursday. Coming into this week, the 20-day average was just 16,757.
Opendoor went public in late 2020 via a SPAC led by venture capitalist and All-In podcaster Chamath Palihapitiya.
Jackson’s logic, summarized: the consensus estimate for Opendoor’s fiscal 2029 sales (albeit from just two analysts who have submitted projections) is $11.6 billion. That’s something the company actually surpassed before, back in its fiscal 2022, when it booked $15.6 billion in sales. He rounds that forecast up to $12 billion and slaps on a 5x enterprise value to estimated sales multiple (its peak multiple in 2021) to get there. This also presumes that net debt falls to zero over this time.
The Takeaway
The firm operates in the same business as the since shuttered home-flipping service Zillow Offers, and suffered a spectacular fall from grace from an intraday peak of $39 in February 2021 down to just $0.50 in late June. Still, Sherwood News’ own Luke Kawa got Jackson to lay out the precise case for OPEN in full.Â
Major Investors Are Buying This Unlisted Stock
When the real estate star behind a $120M exit starts a new company, investors notice. That’s why five different major VC firms have already invested in Pacaso.
Disrupting the real estate industry once again, Pacaso’s streamlined platform offers co-ownership of premier properties, revamping the $1.3T vacation home market.1
And it works. By handing keys to 2,000+ happy homeowners, Pacaso has made $100M+ in gross profits since 2021.2
After last year’s gross profits of $21.4M took Pacaso to 41% YoY growth,3 they recently reserved the Nasdaq ticker PCSO.4
And you can join them as an investor for just $2.90/share.5
Note: Pacaso is a private company not currently listed on the Nasdaq.
Palantir’s valuation is off the chartsÂ
Defense technology company and retail darling Palantir closed at $154 a share yesterday, and has relentlessly outrun the S&P 500 Index over the past 12 months, up 415.9% compared to a “measly” 11.1% increase for the S&P over the same period.Â
The price-to-earnings ratio on this stock is massive, the biggest in the S&P 500 and by a lot.Â
Right now, shareholders are paying 228x earnings per share, which laps the 174x for Boeing, the 135x for Tesla, and the 116x for CrowdStrike.
You can think of price-to-earnings ratios as a barometer of just how wildly excited (high ratios) or downright disinterested (low ratios) the market is about a company and its potential growth.
The euphoria is even more obvious if you look at price-to-sales ratios — the gauge of choice for younger companies that don’t always post quarterly profits.
Palantir’s got the highest price-to-sales ratio in the whole index, at 78x; the second-highest company has a multiple of 26x.Â
Palantir’s business, a combination of a large and expanding contracting relationship with the US government and a high-margin, fast-growing business selling software that helps corporations use AI technology, has been revving. The Street expects sales growth of 28% next year, essentially putting the company in the top 1% of growers.
The Takeaway
Palantir is obviously a remarkable business running like a top, and its future looks exceptionally bright. Clearly the stock market gives extra credit for growth. But not this much credit! Even at the market’s frothiest, most wildly euphoric moments — say, during the tech boom of the late 1990s for Microsoft or Amazon — none of those corporate giants had valuations like Palantir’s. Not even in the same ballpark. To find those, you’d have to look right before the dot-com peak.Â
The Best Thing We Read Today
Trump was right, at least about this
Economists and journalists steeped in pre-Trump economic theory almost universally dismissed his assertions that foreigners would pay for the massive on-again, off-again tariffs that whipsawed the markets and consumer sentiment recently. But it turns out one country is doing exactly that, in one industry.
Yesterday's Big Daily Movers
Lucid skyrocketed on news of a big investment from Uber to speed the launch of its US robotaxi service next year
Steve Madden kicked up after Citi upgraded the stock on a Y2K fashion rebound
TSMC surged on record quarterly profit and a raised outlook
Pepsi popped on a Q2 earnings beat fueled by cost cuts and snacky revamps
Crypto Catch-up
The house passed the GENIUS Act, cementing stablecoins’ legitimacy. It will head to Trump’s desk for a signature today
Ethereum hit a six-month high as BitMine’s ethereum treasury passes the $1 billion mark
The Bitcoin Standard Treasury Company, led by crypto OG Adam Back, will go public via a Cantor SPAC in $1.5 billion PIPE deal
As XRP eyes a new all-time high, one of its cofounders transferred $26 million worth of the token
Dogecoin gets its day in the corporate treasury conversation as Bit Origin secures $500 million to build a stockpile of the meme coin
Snack Fact Of The Day
Britain’s biggest stock index hit a new record this week.
Today's Events
Earnings expected from American Express, Charles Schwab, 3M, and Ally Financial
1 Pacaso estimates the U.S. market at $1.3 trillion and the European market as $500 billion. See website for further details.Â
2 Â The $100M gross profit is calculated from 2021-2024. For more details on the gross profit for 2021- 2023, please see management discussion of the financial condition section of the offering circular. For more details on the 2024 gross profit, please see the 1-K Financial Statements section.
3 Past performance is not indicative of future performance. Gross profit growth is based on the offering circular and 1-K. This gross profit growth has been driven by both the type and the price of units sold. For more details on the gross profit for 2023, please see management discussion of the financial condition section of the offering circular (p.41). For more details on the 2024 gross profit, please see the 1-K Financial Statements section (p.12).
4 Pacaso recently received their ticker reservation with Nasdaq ($PCSO). Reserving the ticker symbol is not a guarantee that the company will go public. Listing on the Nasdaq is subject to approvals.
5 The minimum investment is $1,035.52 when including the 3.5% investor fee. This is a paid advertisement for Pacaso’s Regulation A offering. Please read the offering circular and related risks at invest.pacaso.com.
Investing in private company securities is not suitable for all investors because it is highly speculative and involves a high degree of risk. It should only be considered a long-term investment. You must be prepared to withstand a total loss of your investment. Private company securities are also highly illiquid, and there is no guarantee that a market will develop for such securities.