“Nvidia currently has only $26 billion in sales versus $208-525 billion for the Big 4 (Microsoft, Apple, Google and Amazon).
Just how high are these expectations? Nvidia now trades at over 38x sales and over 200x earnings. We’ve never before seen a price to sales ratio that high for a company of its size…
… The closest recent comparison is Tesla, which traded at nearly 30x sales when it hit the $1 trillion mark back in 2021. What happened after that? It would go on to decline over 70% with its price to sales ratio falling to 5x.
I posted that it was overvalued near its peak, and unsurprisingly was slammed by Tesla critics.”
Academy Sports & Outdoors’ last investor event focused on sustainable growth in the retail space, differentiating their brand through customer experiences, and unveiling a multi-year growth plan.
Perhaps the biggest callout was the argument that ASO has the most productivity per square foot of each store throughout its sector (Dick’s Sporting Goods, Sportsman’s Warehouse, etc.)
Academy Sports + Outdoors (ASO) Stock Performance, 1-Year Chart
Analysts expect $1.65 EPS on Revenue of $1.4 billion
You can explore the ASO 2023 Analyst + Investor Day here.
DocuSign (DOCU)
DocuSign’s Spring 2023 Investor Presentation highlighted solid revenue growth (in-part due to expenses reduction), with billings growth that was accelerating at a decreasing rate.
The most interesting callout was reaching 1,080 customers in FY’23 that had an annualized contract value of over $300K with DocuSign. This number was 437 customers in 2020. We’ll be interested to see if they can peak our interest this week.
DocuSign (DOCU) Stock Performance, 1-Year Chart
Analysts expect $0.55 EPS on Revenue of $641.7 million
You can explore the most recent DOCU investor presentation here.
Investor Events / Global Affairs:
Apple’s World Wide Developer Conference and sonic booms from a private jet chase.
Apple (AAPL) World Wide Developer Conference (WWDC)
Many major updates are expected from Apple’s biggest event of the year. You can expect news regarding the following: xrOS, tvOS 17, M2 Ultra, macOS 14, Mac Studio watchOS 10, iOS 17 with AI, 15” MacBook Air, and the Reality Pro Headset
If you want to see some previews on each of them — check out this tweet.
Apple (AAPL) Stock Performance, 1-Year Chart
“Although we recognize that the AR/VR industry as a whole has generally been disappointing, we believe that Apple’s potential AR/VR headset can succeed where others may have not.” — Goldman Sachs analyst Michael Ng, who has AAPL stock as buy with a PT of $209
Sonic Booms Heard Throughout Washington D.C. Area
Drew Caballero-Reynolds, AFP via Getty Images
If you’re in the nation’s capital, Maryland, or Virginia — you may have heard a loud noise or even been in a shaking building on Sunday. This was caused by a sonic boom from military jets scrambling to intercept a private flight that entered restricted airspace.
The incident involved two fighter jets being deployed after a Cessna plane flew right over Washington D.C. In fact — the bizarre flight pattern saw the jet go from Tennessee, up to its destination in New York (without landing), and right back down the east coast over the capital.
The private aircraft later crashed in Virginia, and no survivors were found. The official statement is that the fighter jets did not shoot the plane down — the investigation will focus on why the pilot didn’t respond to the Federal Aviation Administration.
Focusing on the Services industry and the Credit Crisis.
U.S. International Trade in Goods & Services, May Release of March Data
Monday (6/5): Factory Orders, ISM Services PMI, S&P Services PMI
Tuesday (6/6): N/A
Wednesday (6/7): Consumer Credit, U.S. Trade Deficit
Thursday (6/8): Wholesale Inventories
Friday (6/9): N/A
What We’re Watching:
Services Industry Outlook (Released This Morning)
ISM Services PMI
ISM Services PMI, May 2023
In May, the ISM Services PMI registered 50.3%, a -1.6% decrease compared to the April reading of 51.9%. A reading above 50 percent indicates the services sector economy is generally expanding; below 50 percent indicates it is generally contracting.
The past relationship between the Services PMI® and the overall economy indicates that the ISM Services PMI for May (50.3%) corresponds to a +0.2% increase in real gross domestic product (GDP) on an annualized basis.
S&P Services PMI
S&P Global Services PMI, May 2023
The May US services purchasing managers’ index (PMI) conducted by S&P Global came in at 54.9, which was just below the 55.1 forecast. This morning’s reading keeps the index in expansion territory for the fourth straight month and is the strongest reading in over a year.
“The US continued to see a two-speed economy in May, with the sluggishness of the manufacturing sector contrasting with a resurgent service sector. Businesses in sectors such as travel, tourism, recreation and leisure are enjoying a mini post-pandemic boom as spending is switched from goods to services.”
Both the ISM Services PMI and S&P Global Services PMI Data Overlaid:
Consumer Credit
As broken down in the most recent Week in Review— we have a credit crisis on our hand. The consensus prediction is Q3 summer spending + Q4 holiday spending will only hurt the debt trends in the U.S. Last month’s reading was $26.5B of additional consumer debt and the forecast for this reading (April) is $21.6B.
Events-Driven Winners:
Which stocks moved the most last week.
Lowe’s (LOW) Stock Performance, 5-Day Chart
Our friends at LevelFields scrub through thousands of data points each week to determine how events impact stock prices.
Last week, Lowe’s announced a +5% increase in its quarterly cash dividend. It’s now set at $1.10 per share.
If you’re starting your investing journey or are interested in buying T-bills yielding 5% or more, consider visiting Public.com.
Disclaimer: This is not financial advice or recommendation for any investment. The content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.
