The Rundown - Disney Earnings Get 'Wolverine & Deadpool' Boost, Amazon Launches Discount Store

Episode Date: November 14, 2024

Stock market update for November 14, 2024.

Public.com presents the rundown, your daily market update in five minutes. My name is Zaid Admani, and today is Thursday, November 14th. In today's episode, we recap earnings from Disney. Their streaming business is finally starting to make a profit, but now they face new challenges. Also, Amazon officially launched their T-Mu competitor. We'll tell you more about that, and some of the challenges it might face under a Trump administration. Then stick around to the end of the show to find out why Mark Zuckerberg just dropped a song with T-Pain. And I'm not going to lie, it's kind of catchy. All right, let's go.

Well, yesterday was a choppy day in the markets. The S&P 500 closed the day flat, while the NASDAQ dropped 0.3%. Looks like the stocks are trying to lose some of that post-election momentum. But Bitcoin, on the other hand, doesn't seem to be slowing down at all. Bitcoin hit fresh record highs yesterday jumping past $93,000 last night. It's currently trading around $91,000 this morning at the time of this recording. Obviously, Bitcoin having a great year, especially the last couple weeks. And, you know, a lot of people refer to Bitcoin as digital gold. Well, actual gold is also having a great year, but unlike Bitcoin, it's kind of struggling

over the last couple weeks. Gold prices have lost their momentum and have dropped the two-month lows to around $2,500 per ounce. Two weeks ago, they were trading at a record highs of $2,800 an ounce. Now, one reason for the dip in gold prices is the rising strength of the dollar following the election. And, you know, it's also possible that traders are just taking money out of physical gold. and putting it into digital gold.

You know, Bitcoin. Like, I got a call for my mom yesterday asking me about Bitcoin. So, yeah, we've kind of hit that part of the cycle where everyone and their moms are literally talking about Bitcoin. Just be careful out there. Let's talk some more inflation real quick. On yesterday's episode, we recapped the CPI report, which came in line with expectations.

Go check that out if you missed it. Today, we got the PPI report. This report tracks wholesale prices, and it also came in line with expectations. Wholesale prices were up 0.2% in October compared to September. So this week we've gone two for two when it comes to inflation reports, both coming in in line with expectations. Some people were hoping for some cooler numbers. Inflation is still being stubbornly sticky around these levels.

So I wonder if the Fed's going to change their tune at all. By the way, Jerome Powell is actually giving a speech today. So we'll let you know if he says anything interesting in tomorrow's show. Let's run through some headlines. And let's start with Disney. Disney reported earnings this morning and it was a mixed bag. A lot of good, some bag. Let's start with the good stuff.

Streaming. It's been doing really well. It outperformed expectations. Disney Plus added 4.4 million new subscribers, much higher than the 900,000 that Wall Street was expecting. On top of that, the streaming business is now profitable. They made a profit of $321 million last quarter compared to a $387 million loss in the same quarter one year ago.

In fact, this is the second straight quarter that Disney streaming business made a profit, thanks to some price increases, lower marketing costs, and growth. in advertising revenue. So good for Disney. My only request is, can you just not make the ads on Hulu so annoying? Or like, at least mix it up. I don't want to see the same ad over and over again.

But yeah, Disney's streaming business, definitely a bright spot, and it seems to be gaining momentum. The other big bright spot in Disney's earnings was their movie studio. Their movie studio crushed it thanks to Inside Out 2 and Deadpool. Inside Out 2 was definitely the biggest hit of the summer,

making $1.7 billion and becoming the highest grossing animated movie of all time. On top of that, Deadpool made $1.3 billion and became the highest rated R-rated movie of all time, even though it really wasn't that good. So that's the good stuff. But Disney is still facing some challenges. Like, their cable business, not doing so good. Their traditional TV networks, including ABC, FX, and Disney Channel,

saw the revenues drop 6% and their profits drop 38%. This really shouldn't be a surprise, though, because, like, who still watches cable these days? Now, what might be a bit of a surprise is that Disney is seeing a drop in profits in their theme parks and cruises. Disney calls this their experience unit. That division saw its operating income drop 6%. That's kind of concerning because historically, the experience unit was the profit engine of the company. In fact, it made up 70% of Disney's operating income last year.

Now, Disney says that the profits were lower because of rising costs, which includes buying two new cruise ships. They also blame lower attendance at Disneyland Paris to the Paris Olympics. But the bright spot is that traffic at US parks held pretty steady. And the company expects operating income for the experience division. to grow by 6 to 8% next year. Overall, though, investors seem to be more focused on the good stuff than some of the bad stuff. Disney stock is up around 9% this morning in reaction to their earnings.

Let's shift gears and talk about Amazon. They're launching a new discount shopping platform called Amazon Hall. This is Amazon's alternative to Chinese platforms like Timo and Sheehan that have gotten very popular over the last couple years in the States. Now, Amazon Hall is going to be a separate tab on the Amazon app, and it's going to have items for $20 or less. In fact, most items are going to be under $10. But the catch is that you're going to have to wait one or two weeks to get those items delivered. Amazon says this is already available to some people in the U.S. And I just checked my Amazon app. I don't have it yet. I'm kind of worried

when I get it because the Admani household buys a lot of junk from Amazon already. Now, the reason that it will take one to two weeks to deliver your item is that Amazon will be importing these products directly from China. That's what Timu does. That's what Shien does. And that's why they're able to offer these products so cheaply. And these companies are also taking advantage. of a tax loophole in the U.S. tax code. It's the de minimis loophole and it allows packages that are worth less than $800 to enter the U.S. without having to pay duty fees or tariffs. But I'm not sure how much longer that's going to last because the Biden administration has proposed a rule earlier this year, which would close that loophole. And would Donald Trump take in office, who knows what's

going to happen to this rule? In fact, Donald Trump has talked about slapping a 60% tariff on all Chinese goods. So the timing of Amazon's announcement of this new platform is pretty interesting. Let's talk about some stocks making moves today. Shares of the fashion company Tapestry are up this morning as they called off a $9 billion merger with Capri. Tapestry owns iconic brands like Coach and Kate Spade. They agreed to buy Capri last year for $9 billion. Capri owns iconic brands like Versace, Jimmy Chuse, and Michael Coors.

So they were hoping to make a giant luxury company by combining the two. Well, that deal got blocked by the FTC earlier this year. The FTC was concerned that this would hurt competition. for affordable luxury handbags. So yeah, these two companies didn't want to have a deal with regulators, so they're calling off the merger. And Tapestry investors are happy about that

because they were worried that Tapestry was paying too much for Capri in the first place. So as a result, Tapestry shares are up around 10% this morning. Capri shares, on the other hand, not doing so great, down around 4%. Another stock having a bad day today is super micro. This stock is pretty much in free fall at this point. It's down another 7% this morning

after the company said they need additional time to file their 10-Q form for their earnings last quarter. Something weird is definitely going on at this company, and they might be cooked. Their stock has dropped around 80% from all-time highs earlier this year. Let's wrap the show with a fun fact. Mark Zuckerberg dropped a new song with T. Payne. This is not a Madlib's headline. This is legit.

He posted this song on his IG, and it's on Spotify as well. And I'm not going to lie, it's not that bad. It's kind of catchy. The song is a cover of the iconic Lil' John song, Let's Get Low. I mean, Get Low is like one of the greatest songs of this century. Let's be honest. And yes, I say this as a 33 year old millennial. I mean, this song played at pretty much every party that I ever went to. Now, the official reason that Zuck did this is that he wanted to make the song for his wife for their dating anniversary. He said that Get Low was playing when he first met

his wife Priscilla at a college party at Harvard. That's the case and that's a key detail that the social network movie missed. I mean, come on. How are you going to leave that out? Now, I think the real reason that Zuck is doing this is because he wants to kind of keep cultivating this image of being cool. He's doing the MMA thing. He's doing the chains. And this song is now just part of this whole cool image that he's made for himself. And I'm not going to lie, it's working. I think

Zuck is cool. Well, all right, guys, that's the rundown for today. Hope you guys enjoyed today's episode. If you did, and you have like 15 seconds, consider giving us a five-star rating on Apple and Spotify. If you're listening on Spotify, vote in today's Spotify poll. Leave us a comment. All that engagement really does

help us out. Thank you guys so much for listening. Shout out to Mike and Connor for all the help behind the scenes, and we'll see you guys back here tomorrow. This is the rundown, your real-time resource for news events and trends in the markets. All views presented in the show reflect the opinions of the guests. You should not take any mention of a publicly traded security as a recommendation to buy, sell, or hold that security. Run-down guests are not financial advisors and are not affiliated with public holdings or its subsidiaries. You should make your own financial and investment decisions or consult.

Respect to professionals. Learn more at public.com. Disclosures. In partnership with Zayidimani, brokerage services for U.S. listed, registered securities are offered by open to the public investing incorporated, member FINRA and SIPC.