📊 Richest People In The World

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Happy Sunday!

This week was packed with big headlines, and as always, I’ve got you covered.

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

• iPhone 16 $AAPL first weekend pre-sales fell 13% compared to the iPhone 15.

• US retail sales were stronger than expected, rising 0.1% in August.

• China has seen five consecutive quarters of deflation.

• Goldman Sachs $GS says the S&P 500 $SPX could reach 6,000 in 12 months.

• In the first half of 2024, Netflix $NFLX users watched 94B hours of content.

• MLS team values have jumped $3.2B since Messi joined Inter Miami.

• FedEx $FDX saw its net profit fall 27% in the most recent quarter.

In today’s newsletter:

• 💰 Richest People In The World

• 🏎️ Most Profitable Automakers

• ✂️ The Fed Cuts Rates

• 💸 Microsoft’s Dividend Increase

• 🏴‍☠️ Can Intel Bounce Back?

The rich keep getting richer.

One person in particular is having an exceptional year: Larry Ellison.

Oracle’s founder and current CTO saw his net worth surge by a record $14B in a single day.

This happened after the company’s recent earnings release, pushing him past Bill Gates and Bernard Arnault.

Here’s an interesting fact:

• Ellison consistently owned around 20% of the company. 

• But as Oracle ramped up its share buybacks, that changed. 

• According to FinChat, the company’s weighted average shares outstanding diluted dropped from 5.1B in 2012 to 2.83B in 2024, a 44% decline.

• Thanks to these buybacks—and Ellison holding onto his shares—his stake has roughly doubled, now sitting at 41.3% of the company.

If there was ever a prime example to show the magic of buybacks, this is one of them.

Based on the Bloomberg Billionaires Index, Ellison’s net worth has climbed by roughly $57B in 2024.

Other billionaires are seeing rapid growth as well. 

• Nvidia CEO Jensen Huang’s fortune has skyrocketed by $58B to $102B.

• Similarly, Mark Zuckerberg’s net worth has spiked $71B to $1199B.

On the flip side, Bernard Arnault lost his position as the world’s richest person earlier in the year, with his net worth dropping by $30B this year to $177B.

• His company, LVMH, is grappling with a tough macro environment and declining sales in China.

The wheels seem to be coming off the automobile industry.

This shouldn’t come as a major surprise.

With interest rates still at their highest levels in decades, demand for cars naturally declines as the cost of financing a vehicle becomes more expensive.

We're already seeing the impact.

• In its latest earnings, Tesla reported just 2% revenue growth.

• At Volkswagen, layoffs may be on the horizon after the company exited a labor agreement that protected workers, signaling the need for restructuring.

• Meanwhile, unrelated to higher rates, BMW is facing its own set of challenges, recalling 1.5M vehicles due to a faulty braking system.

One company, however, seems immune to the industry’s struggles: Ferrari.

• In its most recent quarter, Ferrari’s net revenues soared 16.2% and net income jumped 23.7%.

• Per CNBC, analysts estimate that Ferrari could easily sell two to three times its current production, demonstrating how scarcity and exclusivity have bolstered the brand.

• This aura surrounding Ferrari has directly translated into industry-leading operating profit margins of 27.4%, based on the last twelve months.

To add icing on the cake, raised guidance and buybacks show that the Italian luxury sports car manufacturer continues to race ahead of the competition.

This week, we finally got the news we’ve all been waiting for.

The Fed announced at its September meeting a 50 bps rate cut, lowering the Fed Funds Rate to a range of 4.75% to 5.00%.

• This move exceeded the consensus of 25 bps. One interesting note?

• JPMorgan was one of the few major firms predicting the 50 bps cut.

As a result, all three major indices rallied to all-time highs on Thursday, before stabilizing on Friday.

So, what’s next?

• The Fed’s dot plot projections indicate another potential half-point rate cut by year-end.

• And the grass is looking greener. According to a Bloomberg analysis, in years without a recession, the S&P 500 has historically risen an average of 13% within six months after a rate cut.

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John D. Rockefeller famously said:

• “Do you know the only thing that gives me pleasure? It's to see my dividends coming in.”

Microsoft shareholders can certainly relate to this.

• This week, the company increased its quarterly dividend by 10%, raising it to $0.83 per share. 

• On top of that, the board of directors approved a considerable $60B share repurchase program.

• With Microsoft’s market cap at $3.24T as of 9/21, this buyback represents about 1.85% of the total market cap.

The company made other big moves this week as well.

• Microsoft announced a partnership with BlackRock and others to raise $30B for AI data centers and energy infrastructure, with a long-term goal of up to $100B in investments.

This week was a rollercoaster of news for Intel.

Currently the worst-performing Dow Jones stock, down 57% this year, Intel started the week with a big win.

• On Monday, the company confirmed it had secured up to $3B in grants from the Pentagon to manufacture chips for the U.S. military.

Next, Intel announced a major restructuring of its Foundry business, creating an independent subsidiary which would enable it to raise outside funding and establish its own operating board.

• The same announcement revealed an expansion of its partnership with Amazon Web Services to produce custom AI chips, aiming to compete more directly with Nvidia.

Then, on Friday evening, rumors surfaced that Qualcomm had approached Intel about a potential takeover, sending shares soaring.

• With Intel’s market cap at $93B, this deal would mark the largest tech acquisition in history.

• While no formal offer has been made and the deal remains uncertain, it certainly raises big questions about Intel’s future direction.

Notable Companies Reporting Earnings This Week:

• Tuesday (9/24):

  • AutoZone $AZO

• Wednesday (9/25):

  • Micron Technology $MU, Cintas Corporation $CTAS, Jefferies Financial Group $JEF

• Thursday (9/26):

  • Costco $COST, Accenture $ACN

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

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Buys

• Michael McCaul (R)

  • Company: Stifel Financial Corp ($SF)

    • Amount Purchased: $301K - $765K

  • Company: Intel ($INTC)

    • Amount Purchased: $250K - $500K

  • Company: Meta Platforms ($META)

    • Amount Purchased: $150K - $350K

• John Hickenlooper (D)

  • Company: Atlanta Braves Holdings ($BATRA)

    • Amount Purchased: $100K - $250K

    • Description: Exercised Stock Option; Strike Price $26.36; Expires 12/10/2027

Sells

• Michael McCaul (R)

  • Company: Vanguard S&P 500 ETF ($VOO)

    • Amount Sold: $1.85M - $6.75M

  • Company: Amazon ($AMZN)

    • Amount Sold: $230K - $600K

  • Company: Monster ($MNST)

    • Amount Sold: $200K - $500K

• John Hickenlooper (D)

  • Company: Atlanta Braves Holdings ($BATRA)

    • Amount Sold: $250K - $500K

  • Company: Atlanta Braves Holdings ($BATRA)

    • Amount Sold: $50K - $100K

    • Description: Vested RSUs

Buys

• Zenas Biopharma ($ZBIO)

  • Insider: Jason Nunn (Director)

    • # of Shares Purchased: 882,352

    • $ Amount: $14,999,984

    • SEC Forms: [1]

  • Insider: Patrick Enright (Director)

    • # of Shares Purchased: 440,000

    • $ Amount: $7,480,000

    • SEC Forms: [1]

• MBX Biosciences ($MBX)

  • Insider: Carl Gordon (Director)

    • # of Shares Purchased: 750,000

    • $ Amount: $12,000,000

    • SEC Forms: [1]

  • Insider: Tiba Aynechi (Director)

    • # of Shares Purchased: 750,000

    • $ Amount: $12,000,000

    • SEC Forms: [1]

  • Insider: Patrick Heron (Director)

    • # of Shares Purchased: 625,000

    • $ Amount: $10,000,000

    • SEC Forms: [1]

Sells

• Palantir ($PLTR)

  • Insider: Alexander Karp (CEO)

    • # of Shares Sold: 8,753,498

    • $ Amount: $316,710,018

    • SEC Forms: [1]

• Dell ($DELL)

  • Insider: Michael Dell (CEO)

    • # of Shares Sold: 2,682,276

    • $ Amount: $309,722,510

    • SEC Forms: [1]

🤝 Review of the Week