TMTB Weekly; SPCX set up
Happy Sunday. We are going to be as efficient and quick as possible today on this beautiful mid-August weekend. Let’s get straight to it.
A few quick thoughts on the market & price action this week:
Our base case continues to be choppy but upwards trending through end of August. That’s played out so far.
We saw the expected follow-through from earnings that showed acceleration + some positive narrative change: U, SHOP, TEAM, TWLO, NET, ABNB all rallied this week. NBIS and CRWV had solid follow through on better prints. Comes on the back of names like PLTR and SAP that did the same in weeks prior.
Similar to the above px action, we are seeing follow through on positive news outside of earnings. P had significant follow through after announcing 2nd hyperscaler customer. SNDK with nice 8% follow through on Friday after being up 14% the day before. We dove into what SNDK’s medium term top line and FCF analyst day guide implied for 2030 EPS here mid-week. Our takeaway: assuming $1,500 buyback price and anchoring off $300 buyside CY27 EPS, $1K of EPS power in 2030 is possible. Mgmt did a good job helping shift investor focus to the EPS leverage buying back 100% off excess FCF can have. With some narrative issues resolved and spot NAND prices now trending up again, we think path of least resistance leans up here near-term with range prob $1,450 - $1900.
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