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.

EMPLOYMENT COST INDEX SUMMARY

On Friday, April 30th, the Bureau of Labor Statistics published the quarterly summary for the Employment Cost Index Summary. The Employment Cost Index, or ECI is used to measure the percentage changes in the cost of labor, without the influence of employment shifts among occupations and industries. It shows us the differences in compensation levels for labor worked in the private and local and state labor industries.

THE HEADLINES READ:

Compensation costs for civilian workers increased 0.9 percent, seasonally adjusted, for the three-month period ending in March 2021, the U.S. Bureau of Labor Statistics reported today. Wages and salaries increased 1.0 percent and benefit costs increased 0.6 percent from December 2020.

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THE BULLPEN

— Back on Zoom —

after trialing a friend's secret Team Hub collaboration app.

+ Tesla
+ Microsoft
+ Amgen

Plus: Spotify

Extensive study of how to use a financial model to assess a quarterly financial report.

2021 04 28 — BLUE ROOM Investment Team Bullpen

Wednesday
April 28, 2021
9:30 AMBLUE ROOM
Investment Team Bullpen
__________ __________

BLUE ROOM LIMINAL SPACE

— PUSHING FORWARD WITH MADELON ON SOLUTIONS TO HOMELESSNESS —

2021 04 28 BLUE ROOM Housing Meeting #13

Wednesday
April 28, 2021
9:30 A.M.
__________ __________

BLUE ROOM HOUSING
with Madelon of Brooklyn New York

LIMINAL SPACE

We are inspired by our innovative partner and wonderful humans at Madelon Group — please check out their cool new site.

A

R

T

ORO MAS ORO
by Eduardo Sarabia

This project was
started with @paubarrragan
at the start of the pandemic.
Shirts, books, sweaters, hats and socks!

Welcome Mama

In the wee hours of the night we welcomed this magnificent mama and her seven newborn pups. Rubey is a rescue from the tribal lands of the four-corners area. Soul Dog Rescue continues with brave collaborative, targeted work, through spay/neuter clinics, adoptions and rescues to create sustainable change and promote cultural shifts regarding the treatment of companion animals on Native American reservations.

+

PERFORMANCE & FLAVOR

+

__________

Only a chef-led flour could be this sublime.

Made with 🌾 San Luis Valley grains 🌾 that we have nurtured through from soil to seed to cleaning to milling.

REGENERATIVE PRACTICES FOR THE WIN.

April 29, 2021 BLUE ROOM Meeting #049

Thursday
April 29, 2021
12 PM

BLUE ROOM
MEETING
#49

VECTORS / & / FREEDOM

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

—WEEKLY—

company updates
from the BR intern team.

Kelley Jiang

Ticker: LB
Name: L Brands Inc
Number of Shares Outstanding: 278.9M
Market Capitalization: $18.62B

Stock Price History 

April 19, 2021 $65.90

April 20, 2021 $64.12

April 21, 2021 $65.31

April 22, 2021 $66.07

April 23, 2021 $67.38

April 26, 2021 $66.45

April 27, 2021 $67.59

April 28, 2021 $67.44

April 29, 2021 $66.65

April 30, 2021 $66.00

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 more than over 3,000 stores across the globe, the company is focused on inspiring an aspirational lifestyle by making their customers feel bold and powerful. 

According to a new report, L Brands is seeking a target value of more than double the $1.1 billion valuation from the year-old failed deal with Sycamore Partners in selling Victoria’s Secret. Victoria’s Secret’s sales have seen a huge increase, boosting its potential value to $2 to $3 billion. The past year has shown great momentum for the brand with L Brands boosting its first quarter profit outlook twice, crediting expanding shopper demand at Victoria’s Secret. 

Furthermore, Stuart Burgdoefer, the CFO of L Brands, announced that “as a result of the substantial improvement in performance at Victoria’s Secret, various sell side analysts have valued the Victoria's Secret Business at as much as $5 billion. The board and our management team continue to evaluate both a potential spin-off of the Victoria’s Secret business into a separate public company and a sale of the business. The board is committed to pursuing the option that will return the highest value to shareholders.”

Emma Leary

Ticker: MSFT
Name: Microsoft Corporation
Shares Outstanding: 7.542B
Market Cap: $1.957T

Stock Price History

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

April 12, 2021 $254.71

April 13, 2021 $257.26

April 14, 2021 $257.48

April 15, 2021 $257.93

April 16, 2021 $259.47

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 since the company was founded when the era of personal computing was emerging in 1975. The company currently offers three main segments: Productivity and Business Processes, Intelligent Cloud and More Personal Computing. MSFT is continuing to increase its market price and is trading at $259.47 as of April 16 which is, again, a record high. 

MSFT has had a lot of news in the past couple weeks involving acquisitions and security. This March, MSFT has had security breach issues which first surfaced in January but have recently come back into the news as MSFT is finding it difficult to patch all of its software weaknesses. The hacks have been very sophisticated and damaging to the point where the government has taken action to disconnect products. A big way to avoid these types of breaches is the transition to cloud computing which, as mentioned, MSFT is working toward and has been very successful as shown in the stock prices and general public’s allegiance to the company. Despite the security breach news, the government clearly still trusts MSFT as displayed through their recent contract. 

Some other recent news is that the company is working to acquire Discord, a communication and digital distribution platform, after failing to acquire Pinterest and TikTok. While MSFT’s competitors have successfully acquired these community-based platforms such as Google with Youtube, Amazon with Twitch and Facebook with Instagram, MSFT realized it needed a similar platform that engendered its own community, which Discord would provide them. The $10 billion deal is expected to take place sometime this month and with MSFT’s recent success it seems likely to happen. On April 13, however, MSFT acquired Nuance, which combines solutions and expertise to deliver new cloud and AI capabilities across healthcare and other industries. This acquisition indicates the direction toward the healthcare industry that technology companies are moving toward as a result of the pandemic and makes the Discord deal seem less likely.

Julian Martelly

Ticker: AMGN
Name: Amgen, Inc. 
Number of Shares Outstanding: 577.57M
Market Capitalization: $136.844B

Stock Price History

April 16, 2021 $255.71

April 19, 2021 $255.97

April 20, 2021 $259.14

April 21, 2021 $258.78

April 22, 2021 $256.69

April 23, 2021 $257.03

April 26, 2021 $255.52

April 27, 2021 $255.13

April 28, 2021 $236.71

April 29, 2021 $234.71

April 30, 2021 $238.34

Amgen, Inc. Executive Summary (5/01/21)

A biotechnology pioneer since 1980, Amgen is a values-based company dedicated to delivering innovative human therapeutics to areas of highly 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. Most recently, Amgen launched a new program called Biomarker Assist, designed to help more patients with non-small cell lung cancer gain access to biomarker testing. “Approximately half of all patients with non-small cell lung cancer have oncogene biomarkers, yet despite the integral role that biomarkers play in lung cancer to identify patients who may benefit from targeted therapies, many patients are not tested,” said Darryl Sleep, M.D., chief medical officer and senior vice president of Global Medical at Amgen. This biomarker testing is a clinical first step in getting patients the right treatment. Thus, Biomarker Assist, aims to close the gap in testing rates and allow eligible patients to save on biomarker testing.

In other news, the U.S. Food and Drug Administration (FDA) granted Breakthrough Therapy Designation for Amgen’s bemarituzumab, a first-in-class investigational targeted antibody acquired through Amgen’s acquisition of Five Prime Therapeutics back in early March 2021. Bemarituzumab will be used as treatment for patients with fibroblast growth factor 2b (FGFR2b) overexpressing and human epidermal growth growth factor receptor 2 (HER2)-negative metastatic and locally advanced gastric and gastroesophageal (GEJ) adenocarcinoma in combination with modified FOLFOX6 (fluoropyrimidine, leucovorin, and oxaliplatin). Overall, this is a great step forward in their Oncology portfolio, and it will be interesting to see what comes next. 

Julia Martin

Ticker: TSLA
Name: Tesla, Inc.
Number of Shares Outstanding: 959.85 M 
Market Capitalization: $655.25B

Stock Price History

April 19, 2021 $714.63

April 20, 2021 $718.99

April 21, 2021 $744.12

April 22, 2021 $719.69

April 23, 2021 $729.40

April 26, 2021 $738.20

April 27, 2021 $704.74

April 28, 2021 $694.40

April 29, 2021 $677.00

April 30, 2021 $709.44

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 released its 2021 Quarter 1 Earnings Report on April 26, 2021. Tesla reported a record net income of $438 million and earnings of 93 cents per share on revenues of $10.389 billion, which was a 74% year-over-year increase. Additionally, Tesla recorded a $101M profit from selling approximately 10% of its bitcoin holdings. While Tesla did not share Quarter 2 forecasted numbers on their earnings call, they shared that they expect more than 50% vehicle delivery growth in 2021 overall. Model 3 was the best-selling overall premium sedan in the world, outperforming other EVs and gas-consuming vehicles. Tesla CEO Elon Musk said that they expect Tesla’s Model Y to be the best selling car and truck in the world in 2021. It plans to make its ninth version of its Full-Self Driving (FSD) technology available to subscribing customers soon. Musk continues to feel that Autopilot technology is rooted in cameras (which Tesla uses), not radar, and thus will continue evolving their autonomous driving capabilities. Since Tesla released its earnings report, its stock price has dipped back down below $700.

Asher Nyhoff

Ticker: NKE
Name: NIKE, Inc.
Number of Shares Outstanding: 1.27B
Market Capitalization: $210.28B

Stock Price History

April 19, 2021 $132.57

April 20, 2021 $127.11

April 21, 2021 $129.90

April 22, 2021          $129.18

April 22, 2021          $129.18

April 23, 2021          $130.19

April 26, 2021          $131.60

April 27, 2021          $132.11

April 28, 2021          $130.71

April 29, 2021          $133.26

April 30, 2021          $132.62

NIKE has lost contracts with Kobe Bryant and Simone Biles in the past month. Olympian gymnast Simone Biles announced her new partnership with Athleta, Gap’s activewear brand, on April 24. This comes after the expiry of NIKE’s contract with Bryant’s estate on April 13. Athlete partnerships are an important aspect of NIKE’s brand development and marketing strategies, in addition to the source of actual NIKE products like the widely popular Kobe model basketball shoes.

Despite news of the end of both Bryant’s and Biles’ contracts, NIKE’s stock price has risen over the past week to $132.62 as of Friday, from a monthly low point of $127.11 on April 20. Indeed, recent setbacks have not stopped NIKE from continuing to release new shoe models, announcing a variety of new basketball and casual shoe models in the last week.

Elizabeth Orecchia

Ticker: HLT
Name: Hilton
Shares Outstanding = 277.45M
Market Cap = $34.52B

Stock Price History

April 16, 2021 $128.05

April 19, 2021 $125.23

April 20, 2021 $122.22

April 21, 2021 $123.91

April 22, 2021 $125.50

April 23, 2021 $127.40

April 26, 2021 $127.57

April 27, 2021 $130.01

April 28, 2021 $129.11

April 29, 2021 $129.90

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

Recently at HLT: Hilton released their 2020 ESG report last Tuesday, April 20,th reinforcing their commitment to positive global impact

• Through Hilton’s Travel with Purpose program, the company continues to take important steps to integrate positive social impact and environmental stewardship throughout its operations, communities and supply chain.

• Named the 2020 Global Industry Leader on the Dow Jones Sustainability Indices, the most prestigious ranking for corporate responsibility and sustainability performance, for the second consecutive year’

• Recognized just last week as one of the Best Companies to Work For in the U.S. by Great Place to Work and Fortune for the sixth consecutive year, including earning the #1 spot in 2020 and #3 in 2021 – as well as being ranked the #3 World’s Best Workplace and achieving a #1 ranking in seven countries around the world in 2020

• Ranked #2 on DiversityInc’s Top 50 Companies for Diversity list; and

• Named to the 100 Best Corporate Citizens of 2020 list, the only global hotel brand recognized.

• Q1 2021 Earnings Release Date: Pre-Market on May 5, 2021

Kat Paradise

Ticker: NTRS
Name: Northern Trust Corporation
Number of Shares Outstanding: 208.22M 
Market Capitalization: $23.19B

Stock Price History

April 16, 2021 $106.91

April 19, 2021 $106.23

April 20, 2021 $107.37

April 21, 2021 $106.74

April 22, 2021 $106.76

April 23, 2021 $109.53

April 26, 2021 $109.16

April 27, 2021 $111.18

April 28, 2021 $111.84

April 29, 2021 $114.41

The Northern Trust Corporation is a preeminent global financial institution that provides asset servicing, investment management and wealth management services for institutions along with, high-net-worth individuals and families. In recent news, The Northern Trust Corporation announced a new partnership with the Monetary Authority of Singapore. This new development pushes forward Northern Trust’s initiatives to expand globally, specifically into the Asia-Pacific region. The joint venture will launch a new electronic foreign exchange technology platform between the two institutions, to begin bridging the two companies’ currencies and financial ties. In recent years, Northern Trust has launched a number of innovative FX solutions, and acquired BEx LLC, a platform providing algorithmic FX trading, global liquidity aggregation and transparency in execution and pricing to institutional clients worldwide. In addition, it announced a strategic partnership with Lumint Corporation, an innovative provider of currency management services, enhancing Northern Trust’s currency management solutions with machine learning models.

Max Pumilia

Ticker: LOW
Name: Lowe’s Companies Inc
Number of Shares Outstanding: 731M
Market Capitalization: $142.317B

Stock Price History

April 19th, 2021 $203.41

April 20th, 2021 $202.77

April 21st, 2021 $203.91

April 22nd, 2021 $201.30

April 23rd, 2021 $200.93

April 26th, 2021 $199.19

April 27th, 2021 $199.05

April 28th, 2021 $196.06

April 29th, 2021 $198.44

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 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 interest in home improvement through the COVID-19 pandemic, 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 more than tripled since the low -point of the pandemic.

Last Thursday (4/22), Lowe’s announced its acquisition of STAINMASTER, a leading carpet manufacturer, from its former parent company Invista. While Lowe’s has long been the only national home improvement retailer to carry STAINMASTER products, this acquisition gives Lowe’s rights to the intellectual property associated with the carpeting and its manufacturing processes. Lowe’s management hopes that this increased access will allow the retailer to “extend the STAINMASTER brand into other product areas.” As a private label, brands like STAINMASTER are a crucial element of Lowe’s broader efforts to differentiate itself from competitors like Home Depot. Moreover, this acquisition allows Lowe’s to further pursue its Total Home strategy, a sales campaign aimed to elevate Lowe’s to the consumer’s top choice for all home related products. The market did not respond optimistically to this acquisition, for following this announcement, Lowe’s stock quickly lost more than a percentage point of value. While this reaction is not overwhelmingly negative, it does suggest that investors have some reservations concerning the acquisition. 

Taurus Samuels

Ticker: TGT
Name: Target Corporation
Number of Shares Outstanding: 497.57M (as of 4/29/21)
Market Capitalization: $101.32B (as of 4/29/21)

Stock Price History 

April 16, 2021 $208.55

April 19, 2021 $208.65

April 20, 2021 $207.27

April 21, 2021 $206.77

April 22, 2021 $205.57

April 23, 2021 $206.01

April 26, 2021 $203.63

April 27, 2021 $204.36

April 28, 2021 $204.46

April 29, 2021 $207.54

Target Corporation is a retailer based in Minneapolis, Minnesota, founded in 1902. They offer an array of products to their customers, such as various food assortments, apparel and accessories for men, women and children, baby care products, household essentials, home decor, furniture, toys for children, electronic, beauty products, school and office supplies, musical instruments and many everyday essential items.

On April 27, 2021, Target announced their limited-time-only collaboration with plant enthusiast and interior stylist Hilton Carter. This is the first time that the corporation has had a limited edition collection with a plant stylist. The partnership will feature modern and approachable styles of plants and accessories that are meant to spread joy and encourage customers to want to decorate the inside of their homes as with beautiful plants. It will also feature ceramic pots and planters, propagation vessels, terrariums, watering cans and more. Target will offer more than 65 products that all range between $5 and $130 (with most products offered under $30), and will be available in select stores as well as on Target.com. 

This collaboration is Target’s efforts to give customers what they are asking for. Last year, searches on Target.com for plants had increased more than 300%. Target heard their customers and want to deliver to them what they want, which is to decorate their homes with beautiful plants to brighten up their days. This collaboration, along with the partnership with three dress designers and the launch of their food brand, Favorite Day, is a great move for Target as we are halfway through spring and headed towards the summer months. Many customers are going to be looking for these materials to host friends at their homes and offer delicious foods, and showing off new clothes and plants decorated in their houses. 

About Hilton Carter: 

Carter is a plant enthusiast and interior stylist who is celebrated for his love and advocacy of plants. He started his career through Instagram and has now built an array of more than 200 plants. He has also written three books titled Wild at Home (2019), Wild Interiors (2020), and Wild Creations (2021). Carter’s goal is to inspire everyone through his collection of plants and accessories. He plans to inspire Target customers through his plants and bringing the beauty of outside into their homes. 

My name is Julia Martin and I’m from Laguna Beach, California. I am a sophomore at Dartmouth College where I am majoring in Computer Science with a potential minor in Quantitative Social Science. At Dartmouth, I work as a group tutor to other Dartmouth students for Math 13 (Calculus of Vector-Valued Functions). I also conduct research at Dartmouth’s Thayer School of Engineering’s Empower Lab, which focuses on developing interactive tools to capture and act on information that can then empower people and improve their mental and physical health. I am also a member of Dartmouth’s women’s rowing team, which I walked onto my freshman fall. I have thoroughly enjoyed my time working at Blue Room, as the collaborative team environment encourages everyone to be curious. With my background in Computer Science, I was drawn to focus my research on Tesla. It’s fascinating to learn more not just about Tesla, but the electric vehicle (EV) and battery industry as a whole, as well as autonomous driving capabilities. Tesla is definitely at the forefront, and EV and autonomous driving will continually become more prevalent in our society, so I have enjoyed learning more about the growth potential and opportunities in this sector.

Togetherism™ is Blue Room™’s nonprofit arm and today we would like to highlight one of our local heroes — Nathaniel Rateliff. Nathaniel has targeted social and economic injustice through his foundation The Marigold Project.

FRIDAY / APRIL 30 / 2021

— NEW RELEASE FROM THE MARIGOLD SINGLES —

Nathaniel Rateliff
&
Willie Nelson
Duet

“Whether it has been watching Willie lead Farm Aid’s efforts to help the real farmers of America… or take my money on the poker table, getting to know him has been a blessing. ‘It’s Not Supposed to Be That Way’ is a powerful song and it meant a lot to get to sing it with Willie. Having Mickey play so beautifully on it was icing on the cake.” — Nathaniel Rateliff

PROCEEDS FROM THIS RELEASE WILL SUPPORT:

@the_marigold_project
@farmaid
@strongheartsdv.

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