💰 Highest Paid S&P 500 CEOs

Happy Sunday!

Hope you all are enjoying your Memorial Day weekend. What’s better than a 3-day weekend? A 3-day weekend with the latest issue of this newsletter of course! 😉

For those of you who are attending concerts during the break, you might be happy with this news.

This week, the Justice Department sued Livenation, the parent company of Ticketmaster, for running a monopoly over live events and exacerbating prices for fans.

Data in a federal lawsuit filed by consumers in 2022 indicated that roughly 70% of tickets for major concert venues in the U.S. are sold through Ticketmaster.

Some key data bites from this week that you should know: 

• Nvidia $NVDA CEO’s net worth has increased from $3B to $90B in five years.

• Morgan Stanley $MS now sees the S&P 500’s year end forecast at 5,400, up from 4,500.

• 56% of Americans mistakingly think the US is in a recession.

• Pixar $DIS is laying off 14% of its workforce.

• The number of 401(k) millionaires has hit a new record of 485,000.

• 1 in 7 Gen Z credit card users have maxed out their credit cards.

• Hims $HIMS announced weight-loss shots at 85% discount to Wegovy.

• Citi $C paid a $78M fine after a trader accidentally tried to sell $444B worth of European stocks.

• Back in 2010, a man paid 10,000 Bitcoin for Pizza, now worth $700M today.

In today’s newsletter:

• 📊 Michael Burry’s Stock Portfolio

• 🏹 The Return of Robinhood

• 💰 Highest Paid S&P 500 CEOs

• 🦾 Nvidia’s Q1 FY25 Earnings

• 🚀 Magnificent 7 Revenue Growth

• 💄 E.L.F Beauty Hits $1B

Let’s dive right in!

Michael Burry is doubling down on China.

In Q1, his fund's top holdings, JD and Alibaba, now make up 18.2% of his portfolio.

He increased positions in JD by 80% and Alibaba by 66.67%, adding 160,000 shares of JD and 50,000 shares of Alibaba in the first quarter.

Perhaps the most notable change to his portfolio includes the purchase of Sprott Physical Gold Trust, which now makes up roughly 7.4% of his portfolio.

Gold prices are up roughly 13% this year, slightly ahead of the S&P 500’s 12% return.

New additions like Cigna and BP also made it into his top 10 positions.

On the sell side, he sold off Oracle, CVS, Nexstar, and Alphabet, among other names, all former top 10 holdings.

There are few stocks that can plunge nearly 90% from its all-time high and make it back.

That said, Robinhood seems to be resurrecting from the dead.

The company recently reported Q1 2024 earnings that vastly surpassed analyst estimates.

Earnings per share came in at $0.18, far ahead of the $0.06 expected, and revenue came in at $618M, a 40% increase from last year.

The number of Gold Subscribers jumped 42% YoY to 1.68M, while Assets Under Custody surged 66.7% to $130B.

Even more impressive, the company saw net deposits more than double YoY, increasing 154.5% from $4.4B to $11.2B.

Recent moves like adding the new Spot Bitcoin ETFs, 24 hour market, expanding to the UK, and app redesign helped boost engagement.

And as we know, if a business does well, the stock eventually follows.

The stock is now up 133% over the last year, and in the past month, has jumped up nearly 15%.

The recent jump is in part thanks to a double upgrade by Bank of America, who sees higher 2025-26 earnings due to increasing retail activity and faster organic growth.

Hock Tan can claim the exclusive title of the highest paid CEO in the S&P 500.

A recent analysis by the WSJ found Tan at the top of the list, with a total compensation package of $161.83M.

This thick package follows Broadcom’s strong performance, with its stock delivering an impressive 450% return over the last 5 years.

However, there is a catch to Hock Tan’s compensation. 


He has to stay at Broadcom for another five years and the stock has to hit a certain level by the end of 2025 in order to receive the full amount.

This aligns with the broader trend where the majority of CEOs are paid in equity, which incentivizes them to deliver or exceed their operational targets.

The analysis also found that most of the executives saw their pay increase at least 9% compared to last year, with one in four seeing a 25% or higher bump.

Half of the executives made at least $15.7M, up from the previous year’s median pay of $14.5M.

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Jensen delivered once again. 

Nvidia reported earnings for Q1 FY25 this week, and well, I’ll let the numbers speak for themselves: 

• Adj. Earnings: $6.12 vs. $5.59 Est. (+461% YoY) 

• Revenue: $26.04B vs. $24.65B Est. (+262% YoY) 

• Data Center Revenue: $22.6B (+427% YoY) 

• Gross Margin: 78.4% (+13.8 pts)

• Net Profit Margin: 57.1% (+28.7 pts) 

• Cash, Cash Equivalents, & Marketable Securities: $31.4B 

• Free Cash Flow: $14.9B 

Nvidia’s data center revenue, which makes up the lion share of its overall revenue, skyrocketed by 427% YoY to $22.6B, highlighting the continued demand for AI chips. 

Looking ahead, the future also looks bright. 

For the current quarter, the company sees sales reaching $28B, ahead of the $26.61B expected by analysts. 

To add icing on the cake, Nvidia announced a 10-to-1 stock split (effective June 7th) and a 150% increase in its quarterly cash dividend to $0.10 on a pre-split basis. 

This robust performance, along with the stock split and dividend increase, propelled the stock past the $1,000 mark.

Let’s put Nvidia’s revenue growth into perspective.

The company’s revenue growth for the most recent quarter sits miles ahead of the rest of the Magnificent 7.

The next closest company is Meta, with 27% growth, followed by Microsoft at 17%.

And not all companies in the Magnificent 7 fared well. Both Apple and Tesla saw negative revenue growth.

This has translated into a weak start to the year for their stocks, with Apple up just 2%, and Tesla down -28%.

Meanwhile, Nvidia is now up 121% year to date, ahead of its expected revenue growth for the entire year of 98%, as per data from Finchat.

At this point, I’m sure you’re exhausted hearing about Nvidia.

Let’s switch gears to a company that has returned 20x the performance of the S&P 500 over the last 5 years. And no, it’s not a tech company.

The company is e.l.f Beauty.

For those that aren’t familiar, the company is a cosmetic brand known for its affordable makeup & skincare.

This week, they released their Q4 and full fiscal 2024 results, delivering their first $1B in annual net sales, up 77% YoY.

The quarter saw rapid growth, with a 71% increase in net sales and market share expansion of 325 basis points.

This marked the company’s 21st consecutive quarter of net sales and market share growth.

What is driving the rapid growth of e.l.f? Strong execution. The company:

• Markets to different age groups, with a focus on Gen Alpha and Gen Z consumers

• Continues to expand internationally, especially in the U.K. and Canada

• Drives growth to its website via social channels, such as TikTok and Twitch

• Ensures in-store presence by doubling down on national retailers

While the quarter was strong, the company did provide weaker than expected guidance.

Fiscal 2025 net sales is slated between $1.23B - $1.25B, below the $1.27B expected, and adjusted net income is projected between $3.20 - $3.25, under analyst estimates of $3.51.

So if guidance was weaker than expected for this explosive growth stock, why did shares jump +20%?

Investors believe the company hinted at conservative guidance.

On the earnings call, CFO Mandy Fields said, “…last year, we started our guidance at 22% to 24% range, ended the year at 77%. And I’m not saying that we’re promising 77% this year for sure. But what I will say is that it gives you a little bit of insight into our guidance philosophy and what -- has worked well for us over these last five years, taking it one quarter at a time, which is why we indicated that we do love the momentum that we're seeing out of Q1 and feel great about our overall guidance range at this point.”

📚 Recommended Reading

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Notable Companies Reporting Earnings Next Week:

• Tuesday (5/28):

  • Bank of Nova Scotia $BNS, CAVA $CAVA, Box $BOX 

• Wednesday (5/29):

  • Salesforce $CRM, Bank of Montreal $BMO, Agilent $A, HP $HPQ, Pure Storage $PSTG, Okta $OKTA, Dick’s $DKS, UiPath $PATH, Chewy $CHWY, C3 AI $AI

• Thursday (5/30):

  • Costco $COST, Dell Technologies $DELL, Marvell Technology $MRVL, Dollar General $DG, MongoDB $MDB, Zscaler $ZS, Ulta Beauty $ULTA

All of the companies that are reporting earnings next week can be viewed here.

Buys

• Michael McCaul (R)

  • Company: The Kraft Heinz ($KHC)

    • Amount Purchased: $230K - $600K

  • Company: Novo Nordisk ($NVO)

    • Amount Purchased: $250K - $550K

  • Company: Wells Fargo ($WFC)

    • Amount Purchased: $150K - $350K

• Stephen Lynch (D)

  • Company: Nvidia ($NVDA)

    • Amount Purchased: $1K - $15K

Sells

• Michael McCaul (R)

  • Company: Vanguard Total Stock Market ETF (VTI)

    • Amount Sold: $603K - $1.25M

  • Company: Boston Scientific Corp ($BSX)

    • Amount Sold: $280K - $650K

• Pete Sessions (R)

  • Company: Nvidia ($NVDA)

    • Amount Sold: $50K - $100K

Buys

• Privia Health Group ($PRVA)

  • Insider: Adam Boehler (Director)

    • # of Shares Purchased: 552,436

    • $ Amount: $8,978,460

    • SEC Forms: [1]

• Shift4 Payments ($FOUR)

  • Insider: Jared Isaacman (Chairman & CEO)

    • # of Shares Purchased: 39,136

    • $ Amount: $2,506,108

    • SEC Forms: [1]

• Hims & Hers Health ($HIMS)

  • Insider: Christopher Payne (Director)

    • # of Shares Purchased: 110,000

    • $ Amount: $1,951,763

    • SEC Forms: [1]

Sells

• Walmart ($WMT)

  • Insider: Robson Walton (Director)

    • # of Shares Sold: 2,114,161

    • $ Amount: $137,825,571

    • SEC Forms: [1]

• BlackRock ($BLK)

  • Insider: Laurence Fink (Chairman and CEO)

    • # of Shares Sold: 30,978

    • $ Amount: $25,008,124

    • SEC Forms: [1]

• Home Depot ($HD)

  • Insider: Matt Carey (EVP, Customer Experience)

    • # of Shares Sold: 56,008

    • $ Amount: $19,332,587

    • SEC Forms: [1]

🤝 Review of the Week