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Five on Friday

The Market Strikes Back!

The market’s fighting back, Jack Dorsey renews our faith in humanity, Netflix has a new ‘rival’, and Buffett did something weird! But what day is it?

The Quick Fix

#DontBuyIt — The market has been teasing us this week, with one day in green, one day in red, and forever the cycle goes on and on…

#CheersMrDorsey — Twitter (NYSE: TWTR) and Square (NYSE: SQ) CEO Jack Dorsey is breaking the billionaire mold with a feel-good story this week as he pledges $1 billion to fight the coronavirus.

#QuibiTime A quirky new mobile-only streaming app called Quibi hit the market this week, but left much to be desired.

#BuffettDumping — The much-revered ‘Oracle of Omaha’ is getting some funny looks from us this week after reportedly dumping shares in Delta (NYSE: DAL) and Southwest Airlines (NYSE: LUV). 

#AndFinally — Feeling lonely? Missing your partner while stuck in isolation? Fear not, for Facebook’s (NASDAQ: FB) got you covered with its new app.                                                                        

#DontBuyIt

It’s been a rollercoaster ride once more on Wall Street, but the reasoning behind market optimism has stumped many of us. 

What the hell is going on? 

We rose on Monday, fell on Tuesday, we rose on Wednesday again, and on and on and on… It’s making me dizzy just following the stock market recently. Sure there was some logic: on Monday New York City COVID-19 cases appeared to have peaked, and on Wednesday, Bernie Sanders pulled out of the presidential race, easing political concerns on Wall Street. But still: a quarter of all Americans are now either unemployed or taking job cuts, sector-leading businesses have all-but shut down, and the world is in lockdown. I am not trying to be a doomsayer here as I fully believe that we will pull through this, but it may be time to be realistic. Hard times lie ahead, and the economy will need time to recover. It’ll be a long road to normality. What we shouldn’t be doing is investing based on external factors, but rather on how our favorite companies are performing, if we believe in them, how they are led, and all the usual reasons. Invest with logic, not because of the coronavirus. 

Bet you didn’t know

Enough gloom, here’s a positive story for you this week: Hollywood superstar Matthew McConaughey, his wife Camila, and his mom hosted virtual bingo for residents at a senior living facility in Texas to perk them up. ‘Alright alright alright’.

#CheersMrDorsey

As the coronavirus continues to bring out the best of humanity, Jack Dorsey’s actions this week show us that he is a billionaire who puts his money where his mouth is. 

How much did Dorsey donate?

In Marvel’s 2012 blockbuster ‘The Avengers’, Tony Stark a.k.a. Iron Man describes himself as a “genius, billionaire, playboy, philanthropist.” Jack Dorsey can also be described as all of these things, as well as ‘quirky, hippyish, and odd’. The Twitter and Square founder said he was putting 28% of his total wealth toward fighting the coronavirus, amounting to $1 billion. This money will be put into a limited liability company he created, Start Small, which will make grants to beneficiaries impacted by the pandemic. “Why now? The needs are increasingly urgent, and I want to see the impact in my lifetime,” Mr. Dorsey said in a series of tweets announcing his plans. “I hope this inspires others to do something similar.” It is certainly a grand gesture from a man who was almost ousted from Twitter just last month, and is a welcome change from news such as Amazon’s (NASDAQ: AMZN) firing of employees for striking, or Tesla’s (NASDAQ: TSLA) furloughing of its staff. So thank you Mr. Dorsey, for renewing my faith in humanity and putting your money where your mouth is.

Bet you didn’t know

Amazon CEO Jeff Bezos has also donated a significant sum of personal wealth ($100 million) to aiding the COVID-19 fight. However, to put that in perspective, $100 million represents just 0.081% of Bezos’ total wealth.

#QuibiTime

At a time when streaming has become an essential tool in keeping us sane during isolation, short-form streamer Quibi misses the mark upon launch.

What is Quibi? 

I’m not sure if I am simply wrapped up in my little Irish bubble, but I had never heard of Quibi until this week. The mobile-only streaming service, founded by Jeffrey Katzenberg of Disney (NYSE: DIS) and DreamWorks fame, made its (apparently) highly-anticipated consumer debut on Monday. It seems the app was so keen to mirror the launch success of Disney+ that it also experienced an hour-long outage on its opening day. Unfortunately, it didn’t replicate Disney’s opening day numbers, bringing in just 300,000 downloads on opening day, or less than 8% of Disney’s total upon launch. The app is launching with nearly 50 shows today, all of them created specifically for mobile, with episodes that are less than 10 minutes long. The idea was to create a streaming service specifically for people on the go, such as commuters. Commuters who are now stuck at home with more time on their hands than ever before. This strange mesh of Netflix (NASDAQ: NFLX) meets TikTok does not look to be a real competitor in the streaming industry just yet.

Bet you didn’t know

The streaming industry is expected to be worth $30.6 billion per year by 2022. Perhaps COVID-19 will accelerate that figure? 

Is Tesla’s neural network the key to autonomous driving?

#BuffettDumping

According to regulatory filings, Berkshire Hathaway (NYSE: BRK.B) sold about $314 and $74 million worth of shares in Delta and Southwest Airlines respectively last weekend.

What does it matter?

Despite literally stating last month that he would not be selling airline shares, the ‘Oracle of Omaha’ Warren Buffett has gone and dumped airline shares in a big way. The move sent Delta shares tumbling 7% on Monday, especially considering the Berkshire Hathaway CEO owned more than 11% in the company. To make the situation even more bizarre: Berkshire had just boosted its stake in Delta in late February, buying the stock at nearly twice the price it sold it for last week. Locking in his losses goes against the very core value of Buffett’s investment strategy which made him the billionaire he is today. There are many theories as to why Buffett made the unusual move. Perhaps it is because by reducing his stake in the companies to below 10%, he no longer needs to disclose sales to the SEC, thus reducing the overall impact of such trades on the stock. Perhaps he’s just reducing exposure to airlines at an uncertain time? Or perhaps Buffett is simply starting to feel his 89 years. Who knows, but it’s unusual to say the least.

Bet you didn’t know

Buffett made his first investment at 11 years old, buying 6 shares of CITGO stock at $38 a piece. He made $53,000 from investing over the next 5 years. 

#AndFinally

Facebook is not one to shy away from a challenge! Sorry, let me rephrase that — Like that overweight ex-high school star quarterback in his fifties who could have made it to the NFL (if not for that darn knee injury) Zuckerberg seems to think the world revolves around him, and he can just do whatever he wants, like steal any other company’s original products. Facebook has copied just about everyone at this point, and its latest product, ‘Tuned’, appears to take bits of Pinterest (NYSE: PINS), Twitter, Snapchat (NYSE: SNAP), Tinder (NASDAQ: MTCH), and Instagram. The app encourages couples to create an intimate social network between just each other. It offers a ‘completely secure’ *fidgets nervously* experience where couples can share their mood, exchange music, send photos and videos, and create a digital scrapbook. Cynicism apart, it is a nice way for lovers separated by isolation to stay in touch and ‘privately’ share intimate moments virtually, all for no cost at all.

There’s just one catch though…

We did forget to mention: before you go sending your significant other those ‘intimate’ moments, a Facebook account is required in order to sign up, meaning the data people provide can be used for ad targeting. Nothing says intimacy quite like a three-way relationship between you, your partner, and Mark Zuckerberg.

Bet you didn’t know

At $70 billion, Facebook accounted for 50% of global display ad revenue in 2019. The coronavirus is going to really hit Zucks and Co. hard. 

The Week In Numbers

2

presidential candidates now remain after Bernie Sanders dropped out of the race, setting the nation up for a showdown between Donald Trump and Joe Biden.

50 million

subscribers are now using Disney+, less than 5 months since its November launch.

$1 billion

was raised in private funding by Airbnb this week in order to help it through this pandemic. 


MyWallSt operates a full disclosure policy. MyWallSt staff currently holds long positions in companies mentioned above. Read our full disclosure policy here.

Jamie Adams
Jamie Adams
Jamie is a writer here at MyWallSt. His favorite stock is Apple, which is also the first stock he ever bought. Jamie is not only a big fan of its products, but he believes that the tech giant has a whole lot more to give the world, and hasn't even scraped the surface of its potential.