The Rundown - Gold Hits Record High, Red Lobster Files for Bankruptcy

Starting point is 00:00:00 Public.com presents the rundown, your daily market update in five minutes. My name is Zadadmani, and today is Monday, May 20th. In today's episode, we preview another big week. We got announcements from Microsoft and Nvidia, and you're probably going to hear the word AI being thrown around. Also, Red Lobster is filing for bankruptcy, and gold and copper prices are hitting record highs. Then stick around to the end of the show to find out which Sports League is the most followed on social media.

Starting point is 00:00:27 It's not who you think. All right, let's go. Well, guys, markets had another winning week last week. All three major indices were in the green and the Dow hit 40,000 points for the first time ever. I mean, it looks like stocks are getting back on a roll and making all-time highs in the process. The S&P and NASDAQ have had four winning weeks in a row. Investors are starting to get pretty optimistic after a favorable inflation report last week and a solid earnings season. More than 90% of companies in the S&P 500 have reported their first quarter earnings.

Starting point is 00:00:56 And according to fact sheet, 78% of them delivered better than expected profit. Now, one company that hasn't reported earnings yet is Nvidia. They report on Wednesday, and as always with Nvidia, all eyes will be to see if they meet their insanely high expectations. I feel like the anticipation for their earnings report is always really high, because for one, they report so late into earnings season and the hype starts to build up to it. But also, everyone wants to know if Nvidia can keep growing at their insane pace from the demand for all their AI chips. Oh, and then Microsoft is also expected to make some announcements this week. They're expected to show off some new hardware today, and they're also holding their annual build event for developers tomorrow. I wonder if they're going to use the word AI more than the 120 times that Google did at their Google I.O. event last week.

Starting point is 00:01:38 We'll keep you guys in the loop, so make sure you guys are tuning into the rundown every day this week. All right, let's run through some headlines. Starting with Red Lobster. Red Lobster has officially filed for bankruptcy today, and some people are blaming it on their unlimited shrimp promo. I'm not making this up. So Red Lobster has been struggling for years now, and some would say that this bankruptcy was inevitable. Diners at Red Lobster are down around 30% since 2019, and the company lost $73 million last year. Honestly, I can't tell you the last time I've been to a Red Lobster, so this checks out.

Starting point is 00:02:08 Now, on top of the low attendance, Red Lobster also signed some terrible leases. According to Bloomberg, a material portion of Red Lobster's leases were priced above market rates. So higher rents mixed with declining sales is a deadly combo. But to cap it all off, starting in May of last year, the company made their $20 unlimited shrimp promo a permanent menu item, and people took advantage of this. Apparently it cost Red Lobster $11 million. So Red Lobster is headed to bankruptcy. I mean, they've already started shutting down underperforming stores, and they're going to continue working with their lenders to get through bankruptcy. So if you've been craving Red Lobster for some reason, you might want to go soon because they might not be around for much longer.

Starting point is 00:02:48 Let's shift gears and talk about something that hasn't been struggling. Gold and copper. Gold and copper prices are hitting all-time highs right now. The spot price for an ounce of gold hit a record $2,400 today, and copper crossed a record $11,000 a ton. Now, investors consider gold to be a safe haven asset. And with rising geopolitical tensions across the world, gold has been on a tear this year, up more than 17% so far, which is better than the S&P 500 and NASDAQ.

Starting point is 00:03:16 And copper is doing better than that. Copper is up more than 30% this year. See, copper is starting to become increasingly. in demand because it's needed for things like EVs and renewable tech. So that increased demand is causing prices to skyrocket. I mean, it seems like everything is out here making all-time high. It's a stock market and even good old commodities like gold and copper. Let's talk about some stocks making moves today.

Starting point is 00:03:36 Starting with Wix. Shares of the website maker are up this morning after reporting better than expected first quarter earnings. Revenues were up 12% to 419 million, beating analyst estimates, and their earnings per share came in at $1.29, which also beat estimates. And the cherry on top, the company is raising its outlook for revenue and free cash flow for the rest of the year. I mean, that's the trifecta right there, beat on revenue, beat on earnings, and raise guidance. And that's why the stock is up more than 7% in pre-market trading. On the flip side of stock not doing so good is Lee Auto.

Starting point is 00:04:09 The U.S. listed shares of the Chinese automaker are down in the pre-market after reported net profits in the first quarter declined by 37%, which missed analyst's estimates. Now, revenues were up 36%, but that wasn't good enough for investors, and the stock is out more than 4% in pre-market trading. All right, let's wrap the show with a fun fact. Today's fun fact is about live sports viewership. Only 30% of global sports fans between the age of 18 and 24 watch live sports. Compare that to the 75% of those over 55 and older.

Starting point is 00:04:41 This is according to the U-Gov survey last year. Now, the younger generation still follows the sport, but it's all about highlight reels and soundbites. They're following the sports through social media. And I'm not going to lie, I mean, I'm 32 years old and I'm starting to do this myself. I mean, I'll still watch the live games, but sometimes if the games are on too late, I might just catch up the next day on social media. And as far as social media is concerned, the most popular sports league on social media might be a surprise. Because it's not the NFL, it's not the NBA, it's not the Premier League, which is what I thought it was going to be.

Starting point is 00:05:07 It's WWE. Now, yes, I guess we can debate on whether WWE is a sport or theatrical performance. But still, WWE has over 100 million followers on YouTube and over 25 million followers on TikTok. The NBA is in second place with a little over 20 million followers each. And if the younger generation continues to ignore live sports and watch it later on social media, I wonder how that's going to impact the revenues of these sports leagues down the road. I mean, right now sports leagues are making record revenues because live television is a high premium. But if the viewership for that continues to drop, something to keep an eye on.

Starting point is 00:05:40 Because the NBA right now is in talks to renew their television deal, and they're expected to get triple of what their current deal is. I wonder what that's going to look like 10 years from now when they're up for renewal again. that conversation on the rundown in 2034. All right, guys, that's the rundown for today. By the way, I'm recording this episode in my hotel room in London. It just, it feels kind of weird recording the show at 1 p.m. If you notice the difference in audio quality, it's probably because I'm using a portable mic instead of my usual podcasting mic. I'm going to try to make sure that it sounds as close to the original show as possible. And the podcasts aren't stopping.

Starting point is 00:06:09 We're going to be posting every single day covering the Microsoft event, the Nvidia earnings, all of it. If you guys enjoyed today's episode, please give us a five-star rating on Apple and Spotify and vote in today's Spotify poll as well. We put up a poll every day and that engagement really does help the show. Thank you guys so much for listening. Shout out to Connor and Mike for all the hard work behind the scenes. 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 recommendation to buy, sell or hold that security. Rundown guests are not financial

Starting point is 00:06:42 advisors and are not affiliated with public holdings or its subsidiaries. You should make your own financial and investment decisions or consult respective professionals. Learn more at public.com disclosures. In partnership with Zaidid Mani, brokerage services for U.S. listed, registered securities are offered by Open to the Public Investing Incorporated, member FINRA and SIPC.

The Rundown - Gold Hits Record High, Red Lobster Files for Bankruptcy

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