🥕 Instacart's Delayed Delivery

Hello! In today's newsletter: 1) Instacart's IPO Is Back, 2) J.M. Smucker Buys Hostess, 3) Innovation Costs Money

Hi there!

We received a lot of great feedback in our last newsletter, and so we are revamping it to focus more on visuals, and make it more digestible. We will continue to iterate and see what you love best, so always feel free to provide feedback at the end of the newsletter to let us know your thoughts!

We’ll be sending out newsletters on Tuesday and Friday moving forward!

In today’s newsletter:

  • 🥕 Instacart’s IPO Is Back

  • 🍭 J.M. Smucker Buys Hostess

  • 💸 Innovation Costs Money

Let’s dive right in!

Not subscribed yet? Sign up today!

🥕 Instacart’s IPO Is Back

Instacart is aiming for a valuation between $8.6B to $9.3B in its upcoming IPO, significantly lower than its previous valuation of around $39B in 2021.

This decrease reflects waning investor interest in private firms, influenced by rising interest rates which make riskier investments less appealing.

Founded in 2012, Instacart's business boomed in 2020 due to the pandemic, and while its core delivery business growth has slowed, it has diversified into areas like advertising and tech services under CEO Fidji Simo.

The IPO will largely involve sales by early stakeholders rather than raising capital for the company itself.

🥜 J.M. Smucker Buys Hostess

J.M. Smucker has agreed to acquire Hostess Brands, known for Twinkies and other snacks, in a deal valued at $5.6B. The deal, which includes Smucker taking on Hostess's $900M debt, is set to close by the end of April 2024.

However, analysts from JPMorgan Chase see the deal as more favorable for Hostess due to the high acquisition price. They also express concerns about how the brands of the two companies will integrate, given the differences in their product lines.

Despite these concerns, Smucker expects to cut costs by $100M in the combined company within two years.

💸 Innovation Costs Money

Research and development, commonly known as R&D, refers to the amount a company spends to investigate, learn, and build new products, services, or technologies.

Over the last twelve months, Amazon led in R&D spending, investing over $81B. The top 5 is comprised of big tech which has been heavily investing into AI.

While the companies have been been operating more efficiently and cutting costs across the board, AI offers the tech firms an opportunity to automate different workflows and be the potential solution to aging product lines.

🤝 Qualcomm & Apple Deal. Qualcomm $QCOM will supply Apple $AAPL with 5G modems for smartphones until 2026, a move that strengthens Qualcomm's handset business and suggests challenges for Apple in transitioning away from Qualcomm's complex chips. [CNBC]

🏈 Monday Night Football Is Saved. Disney $DIS and Charter Communications $CHTR resolved their dispute, restoring ESPN to 15M cable customers, with the deal ensuring Disney receives approximately $2.2B in fees from Charter. [AP]

🤖 Meta vs OpenAI. Meta $META is developing a new AI system, with plans to release a model more powerful than its recent Llama 2 by next year, and intends to open-source it for companies to freely build AI-powered tools. [WSJ]

🏎️ Tesla’s Supercomputer. Tesla's $TSLA stock surged after Morgan Stanley predicted the Dojo supercomputer could boost the company's market value ~$600B through advancements in robotaxi and software ventures. [R]

👵🏻 Yellen Is Confident. Treasury Secretary Janet Yellen expressed confidence that the US can manage inflation without significantly harming the job market, citing data indicating a decline in inflation and an increase in job seekers. [BB]

Oracle ($ORCL) announced lower-than-expected revenue and guidance. Despite surpassing some analyst expectations, challenges like the transition of Cerner to the cloud and varying segment performances impacted the company's overall financial results. [CNBC]

  • 🟢 EPS $1.19 Beats $1.15 Estimate

  • 🔴 Sales $12.45B Misses $12.47B Estimate

Other Notable Companies Reporting Earnings This Week:

  • Thursday:

    • Adobe ($ADBE), CoPart ($CPRT)

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

How was today's newsletter?

We value all of feedback we receive. Let us know how we did so we can continue to make this the best investing newsletter available!

Login or Subscribe to participate in polls.

Disclaimer: The publisher does not guarantee the accuracy or completeness of the information provided in this page. All statements and expressions herein are the sole opinion of the author.

Carbon Finance is a publisher of financial information, not an investment or financial advisor. We do not provide personalized or individualized investment advice or information that is tailored to the needs of any particular recipient.

The information contained on this website/newsletter has been crafted with the assistance of an AI language model to enhance the content of this newsletter. We have made efforts to ensure the quality and reliability of the information presented, but we cannot guarantee its absolute accuracy. Therefore, readers are advised to exercise their own judgment and seek additional sources if necessary.

THE INFORMATION CONTAINED ON THIS WEBSITE/NEWSLETTER IS NOT AND SHOULD NOT BE CONSTRUED AS INVESTMENT ADVICE, AND DOES NOT PURPORT TO BE AND DOES NOT EXPRESS ANY OPINION AS TO THE PRICE AT WHICH THE SECURITIES OF ANY COMPANY MAY TRADE AT ANY TIME. THE INFORMATION AND OPINIONS PROVIDED HEREIN SHOULD NOT BE TAKEN AS SPECIFIC ADVICE ON THE MERITS OF ANY INVESTMENT DECISION. INVESTORS SHOULD MAKE THEIR OWN INVESTIGATION AND DECISIONS REGARDING THE PROSPECTS OF ANY COMPANY DISCUSSED HEREIN BASED ON SUCH INVESTORS’ OWN REVIEW OF PUBLICLY AVAILABLE INFORMATION AND SHOULD NOT RELY ON THE INFORMATION CONTAINED HEREIN.

No statement or expression of opinion, or any other matter herein, directly or indirectly, is an offer or the solicitation of an offer to buy or sell the securities or financial instruments mentioned.

Any projections, market outlooks or estimates herein are forward looking statements and are inherently unreliable. They are based upon certain assumptions and should not be construed to be indicative of the actual events that will occur. Other events that were not taken into account may occur and may significantly affect the returns or performance of the securities discussed herein. The information provided herein is based on matters as they exist as of the date of preparation and not as of any future date, and the publisher undertakes no obligation to correct, update or revise the information in this document or to otherwise provide any additional material.

The publisher, its affiliates, and clients of the publisher or its affiliates may currently have long or short positions in the securities of the companies mentioned herein, or may have such a position in the future (and therefore may profit from fluctuations in the trading price of the securities). To the extent such persons do have such positions, there is no guarantee that such persons will maintain such positions.

Neither the publisher nor any of its affiliates accepts any liability whatsoever for any direct or consequential loss howsoever arising, directly or indirectly, from any use of the information contained herein.

By using the Site or any affiliated social media account, you are indicating your consent and agreement to this disclaimer Unauthorized reproduction of this newsletter or its contents by photocopy, facsimile or any other means is illegal and punishable by law.