Where Does GameStop Go From Here?

Tale of the Tape

Good evening, y’all. The market of stocks had a minor meltdown. 😭

The Russell 2000 tumbled 3.6%, marking its worst day since February 25th. The Nasdaq retraced yesterday’s gains and then some. 🎢

Utilities, consumer staples, and real estate were the only positive sectors. Basic materials bopped down 2%. Industrials, financials, and energy all lost ~1.5%.  See the energy charts below. 

The cryptos barely crept back. Bitcoin and Etherum both bounced ~1%. 

Dolphin Entertainment ($DLPH) dashed 2.36% after the company announced a new division to create NFTs. 🐬 Will this be real love, or a one-session stand? Who knows… Read the press release here.

The FAANG gang showed some signs of relative strength.  Netflix flew 2.29%. Amazon and Google both gained ~0.80%. Is big cap tech back?? Here’s today’s S&P 500 heatmap:

$ZM and $IQ both zoomed roughly 3%. 🚗 💨

Microsoft marched 0.67% following rumors of its possible Discord acquisition. Be sure to follow us on Instagram 🙂 

GameStop reported earnings after the close. $GME then gapped down 10% after hours. See more below. 

Robinhood confidently filed for its IPO. 🏹 💰 Here’s Bloomberg with the details. 

And here are the closing prints: 

S&P 5003,910-0.76%
Russell 20002,185-3.58%
Dow Jones32,423-0.94%

Low On Energy 😰 😴 

Energy was the third-worst sector today— the energy ETF has slid 11% in the last 7 days. $XLE settled just above its June 2020 high. Here’s the daily chart:

The Oil & Gas Exploration & Production ETF $XOP plopped 4.8%. It’s down ~14% since March 11th. 

Even clean energy struggled to catch a bid. 😪 $ICLN dropped 1.88%— it’s down ~30% from its January 2021 high. Here’s the daily chart:

Crypto Is Heat-ing Up 🔥

If you’re interested in watching Jimmy Butler and the rest of the Heatles play at home next year, there’s a good chance you’ll be watching them play at FTX Arena. 😮

FTX, the popular crypto exchange, has (reportedly) agreed to a $135M naming-rights deal for the Heat’s arena. This is the first time a crypto-associated company has made a deal with a professional sports team (we’re not counting Mark Cuban and the Dallas Mavericks accepting Dogecoin as payment).

Because Miami controls stadiums’ naming rights, the city will be taking a large portion ($5M of the annual $7M) of the deal if it’s approved this upcoming Friday. 

Personally, we’re hoping it’ll be called Satoshi Stadium. But we’re prepared to be disappointed. 😂

Space Service

Lockheed Martin will work with the satellite startup Omnispace to build a space-based 5G network. 📲 🚀

Omnispace’s CEO, Ram Viswanathan, reported: 

This really stems from a common vision of a global 5G network, which enables users to seamlessly transition between the satellite [and the] terrestrial network.

The two companies have been in talks for a year with the common goal of improving space-based communications, starting with the development of a global satellite network. Omnispace also just raised a $60M round of venture capital led by Fortress Investment Group.  

If successful, this partnership’s potential competition includes the likes of SpaceX Starlink, ASET & Science, OneWeb, and Telesate. Here’s CNBC with more. 

Mars’ First City 🚀

Would you move to Mars? 🤔

ABIBOO architectural studio is designing the first-ever self-sufficient and sustainable city on Mars… and it can house up to 1 million humans. 🙌

ABIBOO’s design includes 5 cities, each with the capacity to sustain 200,000-250,000 people. The project’s architects are working with the SONet team to protect the city’s population from radiation, inadequate sunlight, meteorites, and intense atmospheric pressure. 

The settlement’s capital will be called ‘Nüwa,’ and it’ll be built on a Martian cliff face surrounded by smaller ‘macro-buildings.’ Take a peek:

Read more about the Martian civilization here. 👽

Earnings Round-Up

GameStop — $GME 

It was a day of change for $GME. Earlier today, GameStop’s CCO (Chief Customer Officer), Frank Hamlin, announced that he will be leaving the company. 

Right before earnings, Gamestop appointed Jenna Owens as its new COO (she’s been with Amazon and Google), Neda Pacifico as the new Senior VP of E-Commerce (prev: Chewy, Amazon), and Ken Suzuki as $GME’s VP of Supply Chain Systems.

So… how’d they do? 💰

EPS: $1.34 vs $1.33
Revenue: $2.12B, -3.1% YoY

Here’s what CEO George Sherman had to say:

I am proud of how our entire organization came together in 2020 to adapt to the challenging pandemic environment, effectively serve our customers’ demand for gaming and entertainment products, and navigate through the year with strong liquidity and a strengthened balance sheet. The past year also saw us take steps to accelerate our de-densification efforts and streamline our store footprint, leverage our retail locations to provide same-day delivery and curbside pickups, and continue to enhance our suite of E-Commerce platforms.

We also added important experience to our board by appointing several new directors with backgrounds in corporate finance, E-Commerce and technology and subsequently established a strategy-focused committee to accelerate our transformation. Our emphasis in 2021 will be on improving our E-Commerce and customer experience, increasing our speed of delivery, providing superior customer service and expanding our catalogue.

$GME dropped ~10% after hours. 

Adobe — $ADBE

EPS: $2.61 vs $2.26 est.
Revenue: $3.91B, +26.3% YoY

Adobe also offered strong guidance for 2021. President and CEO Shantanu Narayen shared: 

Adobe drove record Q1 revenue and we are raising our annual targets based on the tremendous opportunity across our business and our continued confidence in our global execution. Adobe’s Creative Cloud, Document Cloud, and Experience Cloud have become mission critical to all customer segments—from students to individuals to large enterprises—across the world.

Earnings This Week

Be sure to know when your stocks report earnings. Here’s the earnings calendar

Links That Don’t Suck

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