Happy Sunday to everyone on The Street.

The results of our deodorant poll from last week are at the bottom of this email. Scroll down to take a look at how many people went au naturel while working from home.

While we have you, we have another quick question. The goal of this newsletter is two-fold: we want to help you make and manage your money. We don’t provide investment advice, but we know people who do. So with that said:

PRESENTED BY STARTENGINE

Help Reshape the World of Startup Investing *Investment Round Closes Nov 15*

StartEngine is one of the US’s first platforms specifically designed for online startup investing.

The platform – led by Activision co-founder, Howard Marks, with strategic advisor, Kevin O’Leary* – opens up access to private companies, a potential $10 trillion market usually reserved for the wealthiest of investors.

And get this: while you’d usually use StartEngine to invest in other private companies, you can currently invest in StartEngine itself. But this investment round won’t be open forever, it’s set to close in a few days on November 15th, so explore the opportunity now before the round closes.

With 5x revenue growth from 2019 to 2022**, this put StartEngine on Inc. Magazine’s list of the 5,000 fastest growing private companies in the U.S.*** two years in a row (2022 and 2023)

After a strategic asset acquisition of competitor SeedInvest, StartEngine boasts a community of nearly two million**** that have collectively committed over $1.2 billion to date*****. 

If you want to become a shareholder, act now as this funding round is coming to a close on November 15th.

Review

U.S. stocks rose on Friday after a softer-than-expected jobs report reinforced the idea that the Federal Reserve may stay put in terms of interest rate policy and not raise rates any further.

The economy added 150,000 jobs in October, while the September job gains were revised down by more than a third of the initial number. The unemployment rate also ticked up to 3.9% from 3.8%, indicating the labor market is indeed cooling. Following the news, the 10-year Treasury briefly fell below 4.5%, a level not seen since September.

The Dow Jones Industrial Average added 0.7% or 222 points, while the S&P 500 rose 0.9%. The Nasdaq Composite jumped 1.4%. For the week, the three indexes all added more than 5%.

In earnings news, Apple shares fell 0.5% after reporting a decline in overall sales for the fourth consecutive quarter. While its services revenue increased more than 16% year-over-year, revenue from each of its hardware businesses excluding the iPhone declined.

Elsewhere, shares of Cash App-owner Block surged 10.7% after beating expectations, raising its guidance, and announcing a $1 billion stock buyback. Paramount also beat expectations with a 38% year-over-year rise in revenue and 2.7 million additions in net subscribers to Paramount+. Its shares rallied 15.4%. Sports betting company DraftKings beat analyst expectations, sending its shares 16.5% higher.

In company news, shipping company Maersk announced 10,000 job cuts as demand and inflationary pressures weigh on the shipping industry. Its shares fell 16.9% on the news.

Finally, the ISM Services PMI fell more than expected in October, dipping to the lowest level in five months, even as the sector continued to expand.

Preview

It’s a big week for speeches from Federal Reserve officials, including a speech from Chairman Jerome Powell on Wednesday.

An update on the trade deficit is due Tuesday, followed by a look at consumer credit. On Wednesday, an update on the 30-year fixed-rate mortgage is due. Last week, the average rate declined for the first time in two months to 7.86%.

As usual, we’ll get weekly jobless claims data on Thursday. Rounding out the week, we’ll get an insight into how Americans feel with the University of Michigan consumer sentiment index.

Earning Spotlight

It’s another busy earnings week, with major tech and consumer brands reporting results.

Starting the week, DISH Network (DISH) and TripAdvisor (TRIP) will report results.

On Tuesday, Uber (UBER), eBay (EBAY), Squarespace (SQSP), GoPro (GPRO), Robinhood (HOOD), and CAVA (CAVA) will report. After going public in June, Cava reported a 62% year-over-year increase in revenue in its August earnings report.

Wednesday will be the busiest earnings day of the week, including Disney (DIS), The New York Times (NYT), Roblox (RBLX), Under Armour (UAA), Warner Bros. Discovery (WBD), 23andMe (ME), Lyft (LYFT), and Instacart (CART).

On Thursday, Oatly (OTLY) and Krispy Kreme (DNUT) both hand in reports. Some analysts worry about the sales outlook of food companies due to the popularity of weight-loss drugs like Ozempic (NVO).

How To Capitalize on Different Generational Spending Trends

Not in the Same Boat

Due to the current economic conditions, boomers are finding themselves with a lot of extra cash. Many of them have locked-in super-low mortgage rates so they’re not trying to buy a home when the 30-year is hovering around 8%. Meanwhile, they’ve stored up extra cash so they’re able to invest in high-yield savings accounts or government treasuries — like 3-month T-bills — which have a ~5% return right now.

Their millennial counterparts, on the other hand, are not in the same boat. They’re attempting to cut spending. 

Bank of America believes that investors can look to capitalize on both of these generational economic trends.

Bet on Boomers

Perhaps the biggest reason that boomers find themselves with extra cash is the fact that many are already homeowners. The housing affordability crisis isn’t impacting them as much as it is with millennials.

Boomers are choosing to invest money into their existing homes, rather than purchasing new ones with sky-high interest rates. According to BofA analysts, this is cause to be bullish on home improvement stocks. 

Other sectors that will benefit from this aging, wealthy demographic are healthcare, travel, and housing. As the generation continues to age, healthcare and senior living sectors might see significant growth. Analysts are bullish on investments like cruise line stocks and senior housing real estate investment trusts like Welltower (WELL).

Tightwad Millennials

On the flip side, millennials are strapped for cash. This is mostly due to through-the-roof borrowing and housing costs. With millennials spending the majority of their paycheck on rent, little is left over for discretionary items. 

So what does this mean? Well, certain items that are “nice to have” might get put back on the shelf. Take apparel for example. These days millennials are spending less on this category, which has some analysts bearish on the sector. Womenswear particularly could be hard hit according to BoA.

"Even as overall spending has held up, clothing spending has decelerated in recent weeks," analysts wrote. "We think this is partly explained by the discrepancy in wealth and consumption between the age cohorts."

Off Tune: Higher Interest Rates Make Song Catalogs Less Appealing

Music Rights Roared a Few Years Ago When Rates Plummeted

There’s been a landslide in music stock valuations thanks to central banks around the world hiking interest rates. 

Industry experts say it’s now harder to finance deals to purchase music catalogs because of rising interest rates. For investors, holding cash or bonds might prove a more tempting option when compared to the difficulties of financing a catalog purchase. 

Hipgnosis (HPGSF) knows this all too well. The song catalog fund has seen its stock slashed in half since late 2020, when artists like Stevie Nicks were inking record deals for their music rights.

Shareholders of Hipgnosis are voicing their displeasure, blocking a proposed deal and voting against a business continuation plan. The company is reportedly scrambling to come up with a new plan of action.

Deals for Music Are Shifting to New Genres, Younger Artists

While investor appetite has cooled off, there’s still demand for music. 

Analysts have noted a shift towards smaller deals, with interest turning to hip-hop and Latin genres. 

Wall Street is also noticing that younger artists are willing to put their songs up for sale. Justin Bieber sold his catalog early this year for more than $200 million. Katy Perry reportedly pocketed about $225 million in September for her popular tracks.

Demand for Tunes Grows, Despite Deal Sluggishness

While rates have dented investor demand for catalogs, the music industry is still humming along.

Research points to growth of nearly ten percent in the industry over the first six months of this year. Spotify (SPOT), recently released their quarterly earnings, which indicated that they had subscriber growth of over 15% compared to the same quarter in 2022. 

The streaming stock has roughly doubled in 2023. We wouldn’t be shocked to find out that some (or even a large part) of Spotify’s growth is somehow related to Taylor Swift. It certainly wasn’t a Cruel Summer for the newly minted billionaire music icon.

PRESENTED BY STARTENGINE

Help Reshape the World of Startup Investing *Investment Round Closes Nov 15*

StartEngine is one of the US’s first platforms specifically designed for online startup investing.

The platform – led by Activision co-founder, Howard Marks, with strategic advisor, Kevin O’Leary* – opens up access to private companies, a potential $10 trillion market usually reserved for the wealthiest of investors.

And get this: while you’d usually use StartEngine to invest in other private companies, you can currently invest in StartEngine itself. But this investment round won’t be open forever, it’s set to close in a few days on November 15th, so explore the opportunity now before the round closes.

With 5x revenue growth from 2019 to 2022**, this put StartEngine on Inc. Magazine’s list of the 5,000 fastest growing private companies in the U.S.*** two years in a row (2022 and 2023)

After a strategic asset acquisition of competitor SeedInvest, StartEngine boasts a community of nearly two million**** that have collectively committed over $1.2 billion to date*****. 

If you want to become a shareholder, act now as this funding round is coming to a close on November 15th.

Muni Investors ❤️ New York

The Big Apple Is Feeling the Love, the Bay Area & DC Not So Much

While fans boo the New York Giants, Wall Street is cheering on New York’s public transit. 

New York subway municipal bonds are trading at higher prices as investors jump in on the tax-advantaged yields. The Empire City’s Metropolitan Transportation Authority also recently saw its credit rating and outlook boosted by the S&P. 

Meanwhile, investors have less interest in San Francisco and Washington D.C.’s transit systems. Analysts point to budget troubles in the Bay Area as their reason for staying away. San Francisco’s Bay Area Rapid Transit was downgraded by the S&P earlier this year. 

The outlook on the transit debt in the nation’s capital was lowered and experts say it’s at risk of a downgrade too.

Investors Choosing To Follow the Money

Wall Street is eyeing cities that have funds being allocated toward transportation. 

New York is using higher payroll tax revenue and a congestion pricing plan to boost fiscal support for its transit system. 

Meanwhile, D.C. is threatening to cut services by more than 50% as officials struggle to deal with budget troubles.

Post-Pandemic Shift Dents Train and Bus Revenues

While there has been a push to get employees back in the office, hybrid and remote work means fewer fares on public transit. A cell phone data study points to a nearly 25% drop in foot traffic in metro areas. 

State and local officials across the nation are warning that they’re bringing in less money from mass transit compared to pre-Covid numbers. 

With less fare dollars, experts say more taxpayer dollars will be needed to support the transit system.

So if you live in New York, like many of our readers do, and you take the subway to work, as many of our readers do, just know that somewhere out there, a muni-investor is thanking you for your service.

Last Week's Poll Results

Did you wear deodorant when you were working from home?

🟩🟩🟩🟩🟩🟩 Heck Yes

🟨🟨⬜️⬜️⬜️⬜️ No, But Don't Tell Anyone

Are you bullish or bearish on BMW (BMWYY) stock over the next 12 months?

🟩🟩🟩🟩🟩🟩 🐂 Bullish

🟨🟨🟨🟨⬜️⬜️ 🐻 Bearish

Which stock will have the most growth in 2024?

🟩🟩🟩🟩🟩🟩 Lululemon

🟨🟨⬜️⬜️⬜️⬜️ Nike

🟨🟨🟨⬜️⬜️⬜️ American Eagle Outfitters

Are you bullish or bearish on Crocs over the next 12 months?

🟩🟩🟩🟩🟩🟩 🐂 Bullish

🟨🟨🟨🟨⬜️⬜️ 🐻 Bearish

DISCLAIMERS

Reg A+ offering made available through StartEngine Crowdfunding, Inc. No broker-dealer or intermediary involved in offering. This investment is speculative, illiquid, and involves a high degree of risk, including the possible loss of your entire investment. Please see the most recent supplement, offering circular, and selected risks.
*Kevin O’Leary is a paid spokesperson for StartEngine. See his 17(b) disclosure, https://www.startengine.com/17b.
**Based on StartEngine’s unaudited financials: $1.88M for first half of 2019 compared to $9.9M for first half 2023, since these are semi-annual numbers and have not been audited, they may not include year-end adjustments necessary to make those financial statements comparable to audited results.
***Inc 5000 measures fastest growing private companies by revenue growth over a three-year period.
****StartEngine Community: Count of 1.8 million is determined as the number of unique email addresses in StartEngine’s database as of 10-6-2023.
*****Includes $760M in funds raised as of May 9, 2023 via Reg. CF and Reg. A+ combined through StartEngine’s funding portal and broker dealer, StartEngine Capital, LLC and StartEngine Primary, LLC respectively, as well as StartEngine’s own raises. Also includes $470M in funds raised previously through offerings conducted on www.seedinvest.com outside of the StartEngine platform. In May 2023, StartEngine acquired assets of SeedInvest, including email lists for SeedInvest’s users, investors and founders seeking to raise funds.

This communication from The Street Sheet is for informational purposes only. It is not intended to serve as a recommendation to buy, sell, or hold any security and is not an offer or sale of a security. Information contained within should not be perceived as a research report and is not intended to serve as the basis for any investment decision. Any third-party views reflected herein do not reflect the opinion of The Street Sheet. All investments involve risk and the past performance of a security does not guarantee future results or returns. There is always the potential for financial loss when investing in securities or other financial products. Investors should consider their investment objectives and risks before investing. The Street Sheet is reader-supported. When you buy through links on our site, we may earn an affiliate commission.