QQQs +1.4% with another strong day as SOX +2% outperformed led by AVGO +10.4% showing how fast things can shift in this market (even on big liquid names) and continuing the trend of big moves and follow throughs on earnings. Pretty unique and fun time in tech getting these rapid big moves in large liquid names. Now close to +40% since the print. Our friend J Favuzza @ Jefferies had a good chart this morning showing that % of TMT stocks moving >10% on earnings is 38% this quarter, which is the highest in 10 years and spread of +ve moves greater than -ve moves:
Overall a fruitful earnings season if you were long the right stocks.
BTC now hitting $106k. Non-profitable tech led the way up today, but Megacaps were also strong - strength all around as breadth improved. Odds of a fed cut on Wednesday are 100% but focus is on the commentary and dot plot. Let’s get to it…
Internet
CHWY +4.5%: Didn’t see anything here today…Stock was weak last week as BC (largest shareholder) sold a $500M slug. We thought stock absorbed it well. Bulls playing for the following in this “not exciting but sleep well at night” long: net adds inflecting positive in Q4 while average rev per customer comps get much easier going fwd, growth is re-accel’ing back to dd in Q4 after 5 quarters of single digit growth, product enhancements such as sponsored ads driving better spend, industry trends improving (see recent TGT comments about pet doing better), and buybacks helping support the stock. 3p data has also been improving last couple of weeks. And BC is locked up until 2/6 so they won’t be selling any until then.
GOOGL +3.6% continues to re-rate higher as investors get more excited about AI product releases, Waymo traction in ‘25, and search continues to track inline to better than street. Plenty of room for the stock to re-rate higher - only trading at 16x FY25 FCF
RBLX +3% shaking off some mixed Yipit data - 2nd straight day shakes off mixed news, makes me thinks wants higher. High level - stock is in the middle of an inflection in narrative due to ads ramping and in-game experiences/partnership with SHOP driving better monetization
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