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Welcome back!

It’s been a busy few days, with Jay Powell’s recent positive comments on the economy, plus great earnings from Salesforce, among the driving forces sending stocks higher.

Earnings Corner 📜 

Trending Up 📈 

Salesforce (CRM) reported earnings that missed estimates, with revenue up 8% y/y to $9.44B (vs. $9.34B expected) and EPS of $2.41 (vs. $2.44 expected). Mgmt. touted Agentforce, the platform’s new integrated AI system, as being “at the heart of a groundbreaking transformation” towards AI agent technology. Mgmt. slightly raised its FY 2025 revenue outlook to $37.8B-$38B (vs. $37.7B-$38B previously). The stock was up 11% at Wednesday’s close.

Dollar Tree (DLTR) reported earnings that beat estimates, with comparable sales up 1.8% y/y. The stock was up 1.9% at Wednesday’s close.

Trending Down 📉 

Chewy (CHWY) reported earnings that beat estimates. Active customers fell by 0.5%, but sales per customer grew by 4.2%. The stock was down 3.7% at Wednesday’s close.

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Today’s Headlines 🍿 

• Dealbook Summit Takeaways: The New York Times hosted their annual Dealbook Summit, where prolific business leaders were interviewed. Here’s the takeaways:

  • Jeff Bezos: The Amazon founder was optimistic on the Trump administration reducing regulation. He also stressed the importance of freedom of speech, through his ownership of The Washington Post

  • Sam Altman: The OpenAI CEO suggested AGI may arrive sooner than expected, but might take a while to have an economic disruption due to societal inertia. Sam also revealed OpenAI has over 300mm weekly users and 1.3mm U.S. developers on the platform

  • Jay Powell: Fed Chair Powell highlighted the strength of the U.S. economy, noting it is stronger than he thought it was in September. Notably, Powell compared Bitcoin as a competitor to Gold, as opposed to the US Dollar. He also mentioned he isn’t worried about Trump interfering with the Fed

  • Ken Griffin: The Citadel founder was excited about the incoming Trump administration, while criticizing Europe’s economic conditions as “lethargic”. He also was bullish around Bitcoin due to “the community” it invigorates

• The Latest in France: The current French government led by Emmanuel Macron is facing pressures, after prime minister Michel Barnier was forced out in a no-confidence vote. Macron is expected to name a new prime minister, but Macron’s key opponent, National Rally party leader Marine Le Pen was a key part in collapsing this administration

• The Latest in South Korea: President Yoon imposed martial law on Tuesday, branding his opposition as North Korean sympathizers, but Parliament unanimously revoked the order in less than twenty-four hours. Widely viewed as a desperate political power grab amidst ongoing investigations into his administration, Yoon’s move sparked clashes between military and civilians and public outcry as soldiers encircled the National Assembly

• The CEO of UnitedHealth Insurance has been killed. On Wednesday morning, a masked gunman shot Brian Thompson outside New York Hilton Midtown where UHG was hosting an investor day. Early reports indicate that the attack was targeted

• Leveraged Loan Activity is on fire. This week has been very busy in the leveraged finance markets, mainly driven by companies repricing debt at lower rates. More than $64B of leveraged loan deals launched on Monday, doubling a prior high. This includes borrowers such as Inspire Brands, Culligan, and Jane Street.

• Two Private Credit CLOs launched yesterday, with BondBloxx and Virtus both launching Private Credit ETFs for retail investors

• Elon Doesn’t Get His Money: A Delaware judge ruled on Monday that Tesla CEO Elon Musk still is not entitled to receive a $56B compensation package despite shareholders of the electric vehicle company voting to reinstate it. The court decreed that the 2018 compensation approval process was “deeply flawed”

• SpaceX has a tender offer for shares at a $350B valuation. Valued at $210B in early 2024, this possible sale would lock in the defense contractor provider as the world’s most valuable private startup, offsetting Elon’s Delaware disappointments

• Intel fired their CEO: Under Pat Gelsinger’s leadership since 2021, the chip maker has cratered (down ~60% since he took over), missing out on the AI boom supercharging rivals NVIDIA and AMD. Now, the company is looking for outside talent to replace him, including potentially the current CEO of Marvell

• Enron makes a comeback: Yes, that Enron. An elaborate parody appears to be behind the apparent resurrection of Enron, the Houston-based energy company that filed for bankruptcy in 2001 due to widespread corporate fraud and greed. The parody, announced on the 23rd anniversary of Enron's bankruptcy, involves a fake relaunch as a company dedicated to solving the global energy crisis, complete with a video, billboard ads, and a full-page ad in the Houston Chronicle, but is labeled as "First Amendment protected parody" and "performance art" on the company's website

• Super Micro Computer shares rose 28% over the past few days after a review by their special committee found no evidence of financial misconduct. Previously, auditor EY had to resign due to the company’s inability to file a 10-K, but their new independent auditor, BDO, still needs to review the situation and Nasdaq will need to rule on whether Super Micro can regain compliance

• Trump has two new cabinet picks: Jared Isaaacman, the billionaire CEO of Shift4, a payments processor, will serve as the head of NASA while Paul Atkins, the former SEC Commissioner during the Bush era is returning to the SEC. Atkins is crypto friendly, and is expected to take a de-regulatory approach. Atkins is the current CEO of D.C. consulting firm Patomak Global Partners

• Art Cashin, the New York Stock Exchange legend, has passed away. A six decade trading floor veteran once dubbed “Wall Street’s version of Walter Cronkite” by the Washington Post, Cashin was UBS’ director of floor operations and a frequent CNBC commentator

• Wells Fargo is in talks to sell their San Francisco office. The bank is offloading its headquarters building as part of an ongoing effort to trim costs and modernize the company. Though the company’s leadership is largely based in NY and Charlotte, the SF-born bank will preserve some corporate footprint in the city

• Donald Trump Jr. joining the board of PSQ holdings rocketed the stock 143%. The parent company of PublicSquare, a commerce and payments firm, more than doubled in value after reports surfaced that Trump Jr. may join the “woke-free” marketplace’s board

• BigBear.ai AI has tapped into Palantir-esque hype. The server and storage specialist saw shares soar more than 20% Tuesday morning after the company signed a $165mm 5-year contract with the U.S. army and reported 22% YoY revenue growth

• Campbells lost their CEO to the Washington Commanders. In a rare public company to a sports team move, the CEO of Campbells, which owns food brands such as Campbells Soups, left for a dream role working as President for the NFL’s Commanders. Commanders owner Josh Harris has a big checkbook, so this move comes during a time where he needs the right leader to drive the team’s new stadium efforts

• Larry Ellison’s wife was a surprising key force in an elite college football prospect committing to Michigan instead of LSU. His wife, Jolin Zhu, a 2012 Michigan alum, joined Ellison on a call with QB prospect Bryce Underwood. Bryce Underwood was wooed by Larry Ellison money and a phone call from Michigan legend Tom Brady

• Jaguar’s woes continue: Jaguar released their “Type 00” model which drew critique, the latest criticism of the luxury car brand following their bizarre rebrand.

• AMZN x Anthropic: Bezos’ brainchild is providing OpenAI rival Anthropic, with a large cluster of its Trainium2 semiconductors, which will increase Anthropic's processing power by 5x. This cluster, composed of hundreds of thousands of chips, is designed to enhance Anthropic's ability to train LLMs and perform other ML tasks

• GM is floundering in China. The automaker anticipates incurring over $5B in restructuring costs associated with its highly profitable, now struggling operations in the country. The company plans to write down the value of its Chinese joint-venture operations by up to $2.9B and will take an additional $2.7B in charges for the costs associated with closing factories in the world’s largest car market

• Jaylen Brown is launching his own sneaker brand. The Celtic star’s dissatisfaction with the lack of creative control drove him solo. After his 5-year contract with Adidas ended in 2021, Brown declined to sign another deal, leaving $50mm on the table. Featuring 200+ designs, Brown’s line aims to create a new blueprint for athlete-business partnerships

• Fountainbleu Miami is raising a $975mm CMBS and $225mm mezzanine deal. This will refi prior debt and help repay a construction loan. GS and JP Morgan are leading the bond sale.

• Canary Wharf Group is raising new debt. The British property developer received approval from its bondholders to refinance approximately £600mm ($760mm) of notes set to mature in 2026 and £350mm of bonds due in April. The Qatar Investment Authority and Brookfield Corp. backed developer has struggled amidst exits by tenants like HSBC and Clifford Chance and falling property values

M&A Transactions💭 

University of St. Augustine for Health Sciences, operator of an accredited graduate-level educational institution, was acquired for $138.0M by Perdoceo Education (NAS: PRDO). Morgan Stanley advised on the sale.

United Development Funding, operator of a real estate investment trust, has entered into a definitive agreement to be acquired for $181.0M by Ready Capital. Moelis & Company advised on the sale.

Therakos, provider of extracorporeal photopheresis immune modulation therapy, was acquired for $925.0M by CVC Capital Partners. Lazard advised on the sale.

Tall Oak Midstream, provider of midstream services, was acquired for $450.0M by Summit Midstream Partners (NYS: SMC). Perella Weinberg Partners advised on the sale.

Allianz Insurance reached a definitive agreement to acquire The Insurance Business of Royal Automobile Association of South Australia for $642.0M.

Piezocryst Advanced Sensorics, manufacturer of high-precision sensors, was acquired for $141.71M by Spectris (LON: SXS).

PangeaCo, operator of a fiber optic network firm, was acquired for $315.27M by Kohlberg Kravis Roberts and Empresa Nacional de Telecomunicaciones. The deal values the company at $492.54M.

Longboard Pharmaceuticals (NAS: LBPH), a clinical-stage biopharmaceutical company, was acquired for $2.6B by H. Lundbeck (CSE: HLUN A). EV/Cash Flow was 659.23x. Centerview Partners and Evercore Group advised on the sale.

Lomond Group, provider of property management services, has reached a definitive agreement to be acquired for $573.26M by Mr. Stuart Pender, Intermediate Capital Group, and Linley & Simpson.

Lone Star Funds acquired The Commercial and Residential Fire Business of Carrier Global for $3.0B. J.P. Morgan and Goldman Sachs advised on the sale.

Informa TechTarget (NAS: TTGT), software and analytics leader, was acquired for $237.04M by Informa (LON: INF). EV/EBITDA was 107.18x and EV/Revenue was 1.84x. J.P. Morgan advised on the sale.

Treehouse Foods (NYS: THS) entered into a definitive agreement to acquired The Private Brand Tea Business of Harris Tea for $205.0M. Wells Fargo advised on the sale.

GPS Capital Markets, operator of a corporate foreign exchange brokerage firm, was acquired for $473.29M by Corpay (NYS: CPAY).

Fiery, provider of digital front ends, was acquired for $591.0M by Seiko Epson (TKS: 6724). EV/Revenue was 0.79x. DC Advisory and UBS advised on the sale.

FGS Global, provider of public relations consultancy, was acquired for $1.2B by Kohlberg Kravis Roberts. The transaction values the company at $2.4B. Goldman Sachs advised on the sale.

Fantech Group, manufacturer of air quality solutions, was acquired for $152.86M by Volutions Group (LON: FAN).

The Flexible Packaging Laminating Adhesives Business of Dow (NYS: DOW) was acquired for $150.0M by Arkema (PAR: AKE).

Dext, developer of a bookkeeping automation software, has entered into a definitive agreement to be acquired for $636.95M by IRIS Software Group. Arma Partners advised on the sale.

Crane Composites, manufacturer of fiber-reinforced plastic panels, has entered into a definitive agreement to be acquired for $227.0M by KPS Capital Partners.

Copenhagen Airports (CSE: KBHL), owns and operates Airports, has reached a definitive agreement to be acquired for $4.55B by the Government of Denmark. EV/EBITDA was 22.81x and EV/Revenue was 10.79x.

Carlisle Management Company, operator of a global investment management firm, was acquired for $200.0M by Abacus Life. Manorhaven Capital advised on the sale.

Boost Mobile, provider of telecommunication service, was acquired for $140.0M by Telstra (ASX: TLS). 

Atos Worldgrid, provider of IT consulting, was acquired for $286.61M by Alten (PAR: ATE). BNP Paribas, Perella Weinberg Partners, and Rothschild & Co advised on the sale.

@properties, provider of real estate brokerage services, has reached a definitive agreement to be acquired for $444.0M by Compass (NYS: COMP).

Voortman Cookies, operator of a bakery, was acquired for $305.0M by Second Nature Brands. EV/Revenue was 4.69x. Goldman Sachs advised on the sale.

Vizio, operator of a device and platform business, was acquired for $865.67M by Walmart (NYS: WMT). EV/Revenue was 0.5x. ICR Westwicke advised on the sale.

The Udenyca Trademark of Coherus Biosciences has entered into a definitive agreement to be acquired for $558.4M by Intas Pharmaceuticals. The deal includes $75.0M contingent payout on condition of potential net sales. J.P. Morgan advised on the sale.

Travel Guard Group, provider of travel insurance plans, was acquired for $600.0M by Zurich Insurance Group (SWX: ZURN). Evercore Group advised on the sale.

Kellstrom Aerospace, distributor of engines, aircraft, and spare parts, was acquired for $200.0M by VSE (NAS: VSEC). EV/Revenue was 1.14x. Jefferies advised on the sale.

INEOS Composites, manufacturer of composite products, has reached a definitive agreement to be acquired for $1.8B by KPS Capital Partners. Piper Sandler advised on the sale.

HPS Investment Partners, provider of investment management services, has reached a definitive agreement to be acquired for $12.0B by BlackRock (NYS: BLK). BNP Paribas, Bank of America, Deutsche Bank, J.P. Morgan, Morgan Stanley, RBC, and Goldman Sachs advised on the sale.

G&F Manufacturing, manufacturer of pool heat pumps, was acquired for $108.0M by Pentair (NYS: PNR).

Fresh Produce Group, producer and wholesaler of fruits and vegetables, was acquired for $114.24M by Macquarie Asset Management.

First Derivative, provider of consulting services, was acquired for $293.0M by EPAM Systems (NYS: EPAM). J.P. Morgan and Rothschild & Co advised on the sale.

Adriatic LNG, operator of a regasification terminal, was acquired for $849.2M by Snam and VTTI. Rothschild & Co advised on the sale.

Novavax CZ, operator of vaccine and biologics, has reached a definitive agreement to be acquired for $200.0M by Novo Nordisk (CSE: NOVO B).

Private Placement Transactions💭 

Upwind, operator of a cybersecurity company, raised $100.0M of Series B venture funding led by Craft Ventures.

Tenstorrent, developer of application-specific integrated circuit processors, raised $700.0M of Series D1 venture funding led by Samsung Catalyst Fund, Samsung Venture Investment, AFW Partners, and Samsung Securities at a pre-money valuation of $1.9B.

Public, developer of an investing platform, raised $135.0M of venture funding through a combination of debt and equity. $105.0M of equity funding was led by Accel. $30.0M of debt financing was provided by an undisclosed lenders.

Lumin Digital, developer of a cloud-based digital banking platform, raised $160.0M of venture funding led by Light Street Capital Management.

Maze Therapeutics, developer of biotechnology platform, raised $115.0M of Series D venture funding led by Deep Track Capital and Frazier Lifesciences Acquisition.

Craver, operator of an online personal care product marketplace, raised $175.82M of venture funding led by Mirae Equity Partners, Goodai Global, and The Turning Point.

9fin, developer of a data analytics platform, raised $50.0M of Series B venture funding led by Highland Europe. The $500M valuation is off of $25M of ARR.

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