Welcome to Blue Room's Weekend Update. Each week, we're sharing what companies we're researching and the what, the who and the how that we think makes the companies interesting and unique. This roundup is brought to you weekly by a group of interns, creative minds, artists and investors who believe that through best in class investing along with the democratization of financial education we can do great things together. Enjoy, Explore and Share.

THE WEEK IN ALL-TIME HIGHS

The S&P continues to hit all time highs, finishing this week at 4,128.80.

The Dow hits a new all time high, closing the week at 33,800.60.

Cryptocurrency market as a whole breaks $2 trillion market capitalization, with Bitcoin leading the charge at $1.1 trillion.

DTIL

— PRESENTATION TO THE TEAM —

Thursday
April 8, 2021
9:30 A.M.
__________ __________

BLUE ROOM
Investment Team Bullpen

—Seminal Meeting of—

Liminal Space

2021 04 08 BLUE ROOM Housing Meeting #12

Thursday
April 8, 2021
9:30 A.M.
__________ __________

BLUE ROOM HOUSING
with Madelon of Brooklyn New York

—CLOSES TO—

“I’m a Creep”

April 8, 2021 BLUE ROOM Meeting #46

Thursday
April 8, 2021
12 PM
__________ __________

BLUE ROOM
THURSDAY MEETING

P L E A S E E N J O Y T H E

—WEEKLY—

company updates
from the BR intern team.

AIDAN FETTERLY

Ticker: APPL
Name: Apple, Inc.
Number of Shares Outstanding: 16.94B
Market Capitalization: $2.22T

Stock Price History

March 5, 2021 $125.90

March 6, 2021 $126.21

March 7, 2021 $127.90

March 8, 2021 $130.36

March 9, 2021 $132.99

Apple, Inc. (AAPL)  is a consumer electronics company that holds the title of largest company by market capitalization in the world. Headlined by a product line that features the iPhone, iPad, Mac and AirPod devices as well as a software selection that includes Apple Music, Apple TV+, and the App Store, the blue-chip equity continues to adapt and grow while maintaining its staple position in the technology industry. After hitting an all-time high of $143.16 per share on January 26, AAPL saw an accelerated regression, falling as low as $119.90 on March 30. However, since the turn of the month, the company's share price has gained impressive traction, rising back to $132.99 at the time of writing. Although they have remained noncommittal on speculations of future products, the growing assumption is that Apple's Worldwide Developers Conference, beginning on June 7, will mark major announcements for the firm moving forward. That being said, along with many other hardware developers, Apple has faced a significant shortage of integral parts in recent months, leading to delays in the production of new iPads and MacBooks. It will be of immense importance to follow Apple closely, both to understand how they overcome this current hurdle and how they will be adapting moving forward. 

Ticker: TTWO
Name: Take-Two Interactive Software, Inc.
Number of Shares Outstanding: 115,18M
Market Capitalization: $21.08B

Stock Price History

March 5, 2021 $183.38

March 6, 2021 $184.00

March 7, 2021 $183.65

March 8, 2021 $183.60

March 9, 2021 $184.02

Headquartered in New York, New York, Take-Two Interactive Software, Inc. (TTWO) serves as one of the three main pillars of the video game industry, along with competitors Activision Blizzard and Electronic Arts. Known for their staple action-adventure titles Grand Theft Auto and Red Dead Redemption, along with their annually released NBA 2K series, Take-Two has seen its market price rebound from a five-month low on March 8 of $161.62 to now reach a share price of $184.02. While the equity is still depressed over 14% from an all-time high of $213.34 in early February, Take-Two's momentum shines positively moving forward. Just this week, the company announced the acquisition of augmented-reality company HookBang's gaming division in order to boost their Visual Concepts portfolio and aid in the future development of their basketball series. The addition represents a purposeful push into the field of virtual gaming which for years has remained largely untapped, offering even greater potential for the company moving forward. 

Kelley Jiang

Ticker: LB
Name: L Brands Inc
Number of Shares Outstanding: 278.81M
Market Capitalization: $17.23B

Stock Price History 

March 22, 2021                   $60.01            

March 23, 2021                   $57.48

March 24, 2021                   $57.29

March 25, 2021                   $59.43

March 26, 2021                   $61.60

March 29, 2021                   $59.76

March 30, 2021                   $62.87

March 31, 2021                   $61.86

April 1, 2021                       $61.80

April 5, 2021                       $61.76

April 6, 2021                       $62.04

April 7, 2021                       $64.29

April 8, 2021                       $65.18

L Brands, Inc is a segment retailer focused on personal care goods, women’s intimate and other apparel, beauty and fragrance products. Based in Columbus Ohio, L Brands hosts the flagship brands of Victoria Secret, PINK, and Bath & Body Works under its name. With over 3,000 stores across the globe, the company is focused on inspiring an aspirational lifestyle by making their customers feel bold and powerful. Earlier in March, with the release of L Brands’ 2020 annual report, the company officially reported that they are splitting Victoria Secret and PINK off into its own independent company, leaving Bath & Body Works to be the sole brand under L Brands. Whether Victoria Secret and PINK will be its own public company or privately sold has yet to be determined, but L Brands expects this separation to occur by August of 2021. More recently, with the advent of stimulus checks, consumer spending has been on the rise and in response, L Brands has increased its first quarter earnings per share forecast to a range of $.85 to $1.00 from the prior range of $.55 to $.65. According to L Brands, these positive trends may not continue due to an unusual consumer spending environment persisting from the pandemic. Yet, L Brands’ market value is at an all-time high of $65.18 compared to the beginning of the pandemic from a market low of $9 in March 2020.  

Emma Leary

Ticker: MSFT
Name: Microsoft Corporation
Shares Outstanding: 7.56B
Market Cap: 1.83T

Stock Price History

March 26, 2021 $ 231.55

March 29, 2021 $ 236.59

March 30, 2021 $ 233.53

March 31, 2021 $ 232.91

April 1, 2021 $ 238.47

April 5, 2021 $ 243.76

April 6, 2021 $ 248.84

April 7, 2021 $ 249.85

April 8, 2021 $ 253.25

April 9, 2021 $ 253.86

Microsoft Corporation develops, licenses, and supports software, services, devices, and solutions worldwide. MSFT has been a notable leader in the technology industry for decades now as the company was founded when the era of personal computers was emerging in 1975. The company currently offers three main segments, Productivity and Business Processes, Intelligent Cloud, and More Personal Computing.

MSFT has recently worked to keep up with the recent transition from desktop to cloud computing through their new Azure infrastructure services, Office 365 productivity software and Dynamics enterprise software. These developments have resulted in record stock increases and the company continues to expect increases in sales and earnings per share in 2021. The current market price for MSFT has increased to reach an all-time high this week of $253.86 on April 9, 2021. Since having a market value of around $171.62 per share at the start of the COVID-19 pandemic in 2020, MSFT has performed exceptionally well in comparison to its competitors. MSFT benefited from the consequences of the pandemic as consumers were almost exclusively working and learning from home. Though the company missed an opportunity to lead the video conferencing market with Skype, the recent MSFT stock performance in the first quarter beat out some of their top competitors such as Amazon, Apple, and Tesla with the success in its cloud computing software and offerings. 

This past week, MSFT received a 22 billion dollar contract to supply more than 120,000 HoloLens augmented-reality headsets to the US Army. This contract follows up on their underdog win in 2019 against the largest cloud infrastructure service provider, Amazon, for a major US Defense Department cloud-computing contract worth over $10 billion over a 10-year period.

Julian Martelly

Ticker: AMGN
Name: Amgen, Inc. 
Number of Shares Outstanding: 577.57M
Market Capitalization: 145,558.30M

Stock Price History

March 1, 2021 $227.03

March 2, 2021 $225.69

March 3, 2021                         $223.94

March 4, 2021                         $221.91

March 5, 2021                         $227.72

March 8, 2021                         $227.80

March 9, 2021                         $228.99

March 10, 2021                       $229.96

March 11, 2021                       $231.16

March 12, 2021                       $230.36

March 15, 2021                       $235.96

March 16, 2021                       $240.32

March 17, 2021                       $244.27

March 18, 2021                       $244.41

March 19, 2021                       $245.94

March 22, 2021                       $249.69

March 23, 2021                       $245.03

March 24, 2021                       $245.47

March 25, 2021 $246.25

March 26, 2021 $252.86

March 29, 2021 $254.96

March 30, 2021 $249.75

March 31, 2021 $248.80

April 1, 2021 $249.16

April 5, 2021 $252.02

April 6, 2021 $249.10

April 7, 2021 $248.21

April 8, 2021 $246.02

April 9, 2021 $248.95

Amgen, Inc. Executive Summary (4/6/21)

A biotechnology pioneer since 1980, Amgen is a values-based company dedicated to delivering innovative human therapeutics to areas of high unmet medical need. These areas include: cardiovascular disease, oncology, bone health, neuroscience, nephrology and inflammation. Over the years, they have grown into one of the world’s leading independent biotechnology companies, reaching millions of patients around the globe. More recently, in the past month of March, Amgen has made two strategic acquisitions that set them up for continued success and growth within the biotech field. 

The first is the acquisition of Five Prime Therapeutics. Announced on March 4, 2021, Amgen agreed to acquire Five Prime Therapeutics for $38.00 per share in cash, translating to an equity value of approximately $1.9 billion. Five Prime is a clinical stage biotechnology company focused on rewriting cancer. Through collaborations with leading global pharmaceutical companies, they aim to develop novel, breakthrough therapies with the potential to alter the course of disease in cancers. Their leading asset is bemarituzumab—a Phase 3 Ready, first-in-class program for gastric cancer—is a strong strategic fit with Amgen’s oncology portfolio. This acquisition also supports Amgen’s international expansion strategy. Gastric cancer is the third leading cause of cancer mortality worldwide and is especially prevalent in the Asia-Pacific region, which happens to be where Amgen hopes to generate significant volume growth in the future. 

The second, and most recent acquisition (March 30, 2021), was of Rodeo Therapeutics Corporation—a privately held biopharmaceutical company based in Seattle that develops small-molecule therapies designed to promote regeneration and repair of multiple tissues. Amgen agreed to acquire all outstanding shares of Rodeo for a $55 million upfront payment, along with future contingent milestone payments potentially worth up to an additional $666 million in cash. Rodeo’s 15-prostaglandin dehydrogenase (15-PGDH) modulators have shown real promise, generating compelling data. "The enzyme 15-PGDH plays a key role in many disease-relevant processes such as stem cell self-renewal and epithelial barrier repair. Given the encouraging preclinical data to date, we are excited about the opportunity to develop a novel therapy with potential in a range of important inflammatory disease indications," said Raymond Deshaies, Ph.D., senior vice president of Global Research at Amgen. Thus, Rodeo’s 15-PGDH program is a strong strategic fit within Amgen’s inflammation portfolio and efforts to provide innovative human therapeutics. 

Julia Martin

Ticker: TSLA
Name: Tesla, Inc.
Number of Shares Outstanding: 959.85 M 
Market Capitalization: $656.34B

Stock Price History

March 25, 2021 $640.39 

March 26, 2021 $618.71 

March 29, 2021 $611.29 

March 30, 2021 $635.62

March 31, 2021 $667.93 

April 1, 2021 $661.75 

April 5, 2021 $691.05

April 6, 2021 $691.62 

April 7, 2021 $670.97 

April 8, 2021 $681.85

April 9, 2021. $677.02 

Tesla, Inc. produces electric vehicles and clean energy generation, storage, and consumption solutions. Tesla is focused on accelerating the integration of clean energy transportation and production into society in order to more quickly achieve a zero-emission future. Additionally, all of the new Automotive products include self-driving capabilities, and continuing to develop this Autopilot capability is at the core of Tesla. 

Tesla’s stock has fluctuated recently due to two main reasons. On April 2, 2021, a press release detailed that Tesla produced just over 180,000 vehicles and delivered nearly 185,000 vehicles. These numbers exceeded analysts’ delivery expectations by approximately 10,000 vehicles and is a 109% increase from last year and a 2.3% increase from last quarter. Tesla’s high first quarter numbers are additionally impressive due to the recent shortage in microchips that are crucial to electric vehicle production that resulted in many automotive companies, including Tesla, temporarily shutting down factories. Despite this obstacle, Tesla outperformed competitors and expectations, thereby leading to an increase in their stock price. The April 2 press release also shared that Tesla’s Model Y has been strongly received in China. While Tesla is successfully capturing the Chinese market, news on April 7 revealed push back from the Chinese military regarding Tesla vehicles. The issue arose from the presence of a camera placed above the rear-view mirror in the vehicle that is utilized by Tesla engineers to improve safety. The Chinese military fears that this camera will be utilized for spying by Tesla; however, Tesla has shared that the cameras are not activated outside of North America. 

Ticker: NKE
Name: NIKE, Inc.
Number of Shares Outstanding: 1.27B
Market Capitalization: $210.973B

Stock Price History

March 24, 2021 $133.16

March 25, 2021 $128.64

March 26, 2021 $132.99

March 29, 2021 $133.49

March 30, 2021 $132.95

March 31, 2021 $132.89

April 1, 2021 $132.53

April 5, 2021 $135.12

April 6, 2021 $137.16

April 7, 2021 $136.54

April 8, 2021 $133.53

NIKE is the world’s largest seller of athletic footwear and apparel in the world. NIKE distinguishes itself in the athletic footwear and apparel market with its focus on innovative research and design that incorporate new athletic technologies. Despite the impact of COVID-19, NIKE’s stock price has risen steadily above pre-pandemic levels since a low of $67.45 on March 16th, 2020. 

NIKE acknowledged supply chain disruptions related to the COVID-19 pandemic in its 2021 fiscal year third quarter earnings report, citing global container shortages and port congestion. The impact of the pandemic has also impacted NIKE’s brick and mortar retail operations, contributing to an 11% decline in revenue in North America during the third quarter. However, NIKE DIRECT—NIKE’s online and in-person direct to consumer sales—grew by 59% in the third quarter, with strong increases across the world. Success in the DIRECT branch of NIKE sales reflects positively on NIKE’s investment in creating a high quality digital sales experience. 

On Thursday April 8th, NIKE unveiled its jersey lineup for the 2021 Women’s National Basketball Association (WNBA) season. NIKE has designed jerseys for the WNBA since 2018, but this year focused extensively on personalization and story-telling through the uniforms. Traditionally, NIKE sales have been linked to sporting events and sports league seasons, and as such, the resumption of professional sports will likely bolster NIKE revenues and stock prices moving forward.

Elizabeth Orecchia

Ticker: HLT
Name: Hilton
Number of Shares: 277.45M outstanding
Market Cap: 33.77B

Stock Price History

March 24, 2021 $118.50
March 25, 2021 $120.40
March 26, 2021 $121.12
March 29, 2021 $119.05
March 30, 2021 $122.06
March 31, 2021 $120.92
April 1, 2021 $121.65
April 5, 2021 $125.40
April 6, 2021 $126.66
April 7, 2021 $125.29
April 8, 2021 $125.28
April 9, 2021 $123.59

Hilton Worldwide Holdings Inc. was founded in 1919 and is headquartered in McLean, Virginia. They own, lease, manage, develop, and franchise hotels and resorts. It operates through two segments, Management and Franchise, and Ownership. The company engages in the hotel management and licensing of its brands. As of December 31, 2020, the company had approximately 6,478 properties operating under the Hilton label, with over 1,000,000 rooms in 119 countries and territories.

Number of hotel rooms = 1,019,287

Market capitalization of the company at 52 week high stock price = 35,768,854,000 

Market capitalization of the company at 52 week low stock price = 17,332,301,500

Market capitalization of the company at 52 week high stock price / Number of hotel rooms = 35,092

Market capitalization of the company at 52 week low stock price / Number of hotel rooms = 17,004

Hilton’s stock price is now surpassing their previous pre-pandemic high of $110.91, closing on Tuesday at $126.66, up almost 91% from their pandemic low of $68.24 in March. 

Despite a poor year for the travel industry, Hilton has bounced back rigorously. Why is this the case?

They were early movers when it came to pandemic adaptation. They rapidly partnered with Lysol, Dettol, and the Mayo Clinic to upgrade their cleaning practices, and worked with American Express to donate up to 1 million hotel room nights across the U.S. for frontline medical professionals leading the fight against COVID-19. Recognising the ample empty conference rooms, they had, they also provided alternative remote working options through the launch of WorkSpaces by Hilton in the U.S., Canada and the United Kingdom.

Kat Paradise

Ticker: NTRS
Name: Northern Trust Corporation
Number of Shares Outstanding: 208.22M
Market Capitalization: 22.10B

Stock Price History

March 24, 2021 $99.35

March 25, 2021 $102.93

March 26, 2021 $105.85

March 29, 2021 $106.58

March 30, 2021 $107.02

March 31, 2021 $105.11

April 1, 2021 $105.63

April 5, 2021 $106.87

April 6, 2021 $105.71

April 7, 2021 $106.83

April 8, 2021 $106.51

April 9, 2021 $107.45

NIKE is the world’s largest seller of athletic footwear and apparel in the world. NIKE distinguishes itself in the athletic footwear and apparel market with its focus on innovative research and design that incorporate new athletic technologies. Despite the impact of COVID-19, NIKE’s stock price has risen steadily above pre-pandemic levels since a low of $67.45 on March 16th, 2020. 

NIKE acknowledged supply chain disruptions related to the COVID-19 pandemic in its 2021 fiscal year third quarter earnings report, citing global container shortages and port congestion. The impact of the pandemic has also impacted NIKE’s brick and mortar retail operations, contributing to an 11% decline in revenue in North America during the third quarter. However, NIKE DIRECT—NIKE’s online and in-person direct to consumer sales—grew by 59% in the third quarter, with strong increases across the world. Success in the DIRECT branch of NIKE sales reflects positively on NIKE’s investment in creating a high quality digital sales experience. 

On Thursday April 8th, NIKE unveiled its jersey lineup for the 2021 Women’s National Basketball Association (WNBA) season. NIKE has designed jerseys for the WNBA since 2018, but this year focused extensively on personalization and story-telling through the uniforms. Traditionally, NIKE sales have been linked to sporting events and sports league seasons, and as such, the resumption of professional sports will likely bolster NIKE revenues and stock prices moving forward.

Max Pumilia

Ticker: LOW
Name: Lowe’s Companies Inc
Number of Shares Outstanding: 731M
Market Capitalization: $139.298B

Stock Price History

March 4th, 2021 $153.77

March 5th, 2021 $158.58

March 8th, 2021 $162.92

March 9th, 2021 $165.99

March 10th, 2021 $168.46

March 11th, 2021 $170.75

March 12th, 2021 $171.55

March 15th, 2021 $174.20

March 16th, 2021 $175.33

March 17th, 2021 $174.44

March 18th, 2021 $174.87

March 19th, 2021 $179.49

March 22nd, 2021 $181.89

March 23rd, 2021 $180.40

March 24th, 2021 $180.68

March 25th, 2021 $185.17

March 26th, 2021 $191.61

March 29th, 2021 $188.62

March 30th, 2021 $190.02

March 31st, 2021 $190.18

April 1st, 2021 $191.32

April 5th, 2021 $193.73

April 6th, 2021 $194.20

April 7th, 2021 $193.67

April 8th, 2021 $194.21

April 9, 2021 $198.19

Lowe’s Companies, Inc. is an American retailer specializing in home improvement products. With almost 2,200 locations and over 300,000 employees across the U.S. and Canada, Lowe’s has firmly established itself as the second largest retailer in its industry, trailing only The Home Depot. In 2020, Lowe’s posted its most successful year ever, servicing approximately 20 million customers weekly and generating $90 billion in annual sales. These sales, a product of the consumer’s increased time spent at home during quarantine and the government’s economic stimulus packages, represent an almost 24% increase in revenue year over year. Comparatively, between 2016 and 2019, revenue saw under 3% annualized growth. Valuations have reflected the operational success of this period: stock prices have grown more than 50% since the start of 2020 and have almost tripled since the low-point of the pandemic.

In recent weeks, a strong fourth quarter sales and earnings report combined with a newly announced sales campaign to drive significant appreciation. Between March 4th and April 8th, the price of Lowe’s stock increased 26%. However, recent news on Lowe’s near-term future has not been entirely positive. As the country reopens and consumers are less confined to their homes, the retailer’s management predicts a 5% to 7% drop in demand in the home improvement sector. Thus, the coming months will prove crucial in elucidating whether the past year has been an anomalous product of a quarantining world or the beginning of a new trend in regards to Lowe’s performance and valuation. 

Taurus Samuels

Ticker: TGT
Name: Target Corporation
Number of Shares Outstanding: 498.62M 
Market Capitalization: 101.448B

Stock Price History 

March 24, 2021 $188.28

March 25, 2021 $192.70

March 26, 2021 $200.72

March 29, 2021 $198.21

March 30, 2021 $199.65

March 31, 2021 $198.07

April 01, 2021 $200.07

April 05, 2021 $205.35

April 06, 2021 $205.43

April 07, 2021 $204.45

April 08, 2021 $203.46

April 09, 2021 $205.36

Target Corporation is a retailer based in Minneapolis, Minnesota, founded in 1902. As of January 30, 2021, they have over 1,500 stores across the United States. They offer an array of products to their customers, such as various merchandise, everyday essential items, clothing, and food. In many of their locations, they have also partnered with other companies, such as CVS Pharmacy, Inc. to provide their customers with access to a pharmacy when shopping at their stores. 

Unlike many other companies, TGT benefitted from the pandemic. Since March 13, 2020, when the United States declared the Coronavirus a national emergency, Target has seen its stock surge in the Fiscal Year of 2020. Before the pandemic hit, Target put a big emphasis on speed and convenience for their customers. In 2016, they launched their small-format stores, which essentially took a normal sized Target of 100,000+ square feet, and shrank it down to about 50,000, while keeping all of it’s normal items offered, just in a smaller space. Not only did this allow customers to get in and out of stores more quickly and efficiently, it also allowed Target to penetrate neighborhoods where a normal, large-format store would not have been able to operate. During the pandemic, these small format stores allowed their customers to be able to move quickly throughout the store, spending the least amount of time walking around as possible, in order to avoid contracting COVID-19. 

Target also put a huge emphasis on their online presence before the pandemic hit. They invested heavily into their online business, and it paid off. They saw their digital sales soar during 2020, with an increase of 145%! They implemented things such as same day pick up, which allowed their customers to order something online and pick it up that same day, providing their customers with a quick, convenient, and safe way of shopping in a very hectic and scary time.

Target’s 2020 Fiscal Year ended on January 30, 2021, placing November, December, and January as their Q4 in the months. Another reason TGT had such a strong year, and finished it on a high note was because many shoppers were heading into Target stores for the holiday season. Paired with the most recent federal stimulus, many optimistic shoppers were eager to get out and shop, whether it be in stores or online. This benefited TGT, and they were able to end their fiscal year on a high note.

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