Happy Sunday to everyone on The Street. 

This headline caught our eye and we thought the word choice was mildly funny, and also amazing copywriting:

• Boomers are the wealthiest generation that’s ever lived—and millennials are the ‘biggest losers’ thanks to economic crises

Here’s a brief summary: A new report by Allianz reveals that Baby Boomers are the wealthiest generation ever, largely due to favorable economic conditions like affordable housing and booming equity markets during their peak earning years. In contrast, Millennials have faced numerous economic crises including the 2008 financial crisis, the COVID-19 pandemic, and high inflation, resulting in lower returns on their savings and significantly less wealth compared to previous generations.

Here’s the thing. We also saw this headline from the Wall Street Journal:

• Millennials Are Now Wealthier Than Generations Before at the Same Age

C’mon man! Are Millennials poor or rich? Which one is it?

Zooming out, while Millennials may benefit from inheritances from Boomers, they are unlikely to surpass their parents' generation in terms of wealth accumulation due to challenging economic conditions.

Gen Z, however, has the potential to outperform all previous generations if they align their savings behavior with future economic realities, which are expected to be shaped by factors such as the green and digital transformations. Too bad TikTok gave this entire generation attention deficit disorder. If they could focus on something for more than a few seconds I would say maybe they have a chance!

Sincerely,

A Millennial

Before we dive in, today’s sponsor is highlighting how everyday investors can get exposure to art as an asset…

SPONSORED & WRITTEN BY MASTERWORKS

Over the last seven elections, this asset class has outpaced the S&P 500

Instead of trying to predict which party will win, and where to invest afterwards, why not invest in an ‘election-proof’ alternative asset?

The sector is currently in a softer cycle, but over the last seven elections (1995-2023) blue-chip contemporary art has outpaced the S&P 500 by 64%, regardless of the victors, and we have conviction it will rebound to these levels long-term.

Now, thanks to Masterworks’ art investing platform, you can easily diversify into this asset class without needing millions or art expertise, alongside 65,000+ other art investors.

From their 23 exits so far, Masterworks investors have realized representative annualized net returns like +17.6%, +17.8%, and +21.5% among assets held longer than one year.

It's easy to get started at Masterworks, and our readers can skip the waitlist here.

Worth the Commotion? Diving Into the Tesla Event

A Highly-Anticipated Unveiling

Tesla (TSLA) will soon hold its robotaxi unveiling event, and shares are surging leading up to the gathering.

Dubbed “We, Robot,” the event is scheduled for October 10th in Los Angeles and has recently garnered some hype. Analysts expect the company to debut a Cybercab robotaxi prototype, driver assistance advancements, and new AI technology at the event. The robotaxi service will allow self-driving vehicle owners to lend their cars to be used in an Uber-like fashion.

However, not all of Wall Street is convinced that the new service will impact Tesla’s bottom line in a meaningful way in the near term. There has been a mixture of responses to the commotion.

The Bulls

Cathie Wood of Ark Invest is bullish. Her firm recently upped its Tesla long-term price target to $2,600 per share by 2029. Wood has been bullish on Tesla for years, and believes that the robotaxi business has the potential to account for 90% of Tesla’s enterprise value and earnings by 2029.

Morgan Stanley’s (MS) Adam Jonas is in the same camp as Wood. He has listed Tesla as the firm’s top US automotive stock pick. Jonas is bullish on autonomous vehicles’ long-term potential but believes short-term expectations should be more conservative.

The Bears

Garrett Nelson of CFRA, on the other hand, thinks the event is nothing more than a publicity stunt aimed to create buzz. Nelson said that Tesla’s revenue and earnings growth have stalled, and it will be challenging for the EV maker to live up to the hype.

Bernstein is bearish as well, giving the stock an underperform rating with around 54% downside. The firm believes Tesla will have difficulty bringing full level 5 autonomous driving to market.

The bulls and the bears will watch as Tesla’s event unfurls this week.

Oppenheimer’s October Picks

A Strong September

Historically speaking, September hasn’t been a great month for stocks. However, that was not the case this year. The S&P, Nasdaq and DJIA all saw modest gains. September concluded the fourth straight positive month for all three major averages.

Now Oppenheimer (OPY) is looking at a few stocks for continued gains in October and beyond. The bank came out with a list of stocks it thinks are poised for a strong 12 months ahead. Here are two of its top picks.

DraftKings

Analyst Jed Kelly is bullish on DraftKings (DKNG), anticipating the stock to command somewhere between 30% and 35% of the sports betting market share over the next several months.

Shares are up around 12% YTD after a recent pullback, and Kelly gives it a $55 price target, representing an upside of 46% from Wednesday’s close. The company recently announced plans to double profits by 2027 and initiate $5 billion in stock buybacks.

Viking Therapeutics

Oppenheimer also gave Viking Therapeutics (VKTX) the green light, with a price target of $138. This implies an upside of over 113% from Wednesday’s close. The stock is up over 253% YTD and the firm expects that trend to continue aggressively.

Excitement surrounding the biotech company’s clinical trials for an obesity treatment drug is growing, and analyst Jay Olson says the stock is undervalued when compared to its competition. Wall Street agrees as all 13 analysts covering the stock give it a buy or strong buy rating.

As the year closes out, these stocks have Oppenheimer analysts bullish.

Dividends > Inflation

A play on lower interest rates

While inflation in the US is now well below its pandemic highs, prices throughout the economy are still rising. Last month, PCE inflation – the Fed’s preferred measure of price increases – came in at 2.2%.

The good news for investors is that many dividend-paying companies are increasing their payouts at a rate far higher than this. One example here is Home Depot (HD), which offers a yield of about 2.2% at present. Over the last three years, however, it has increased its payout by an average of 11.7% per year.

This stock has had a strong run lately. But it could have further to climb. If the housing market gets a boost from lower interest rates in the months ahead, home improvement retailers are likely to benefit. It’s worth noting that analysts at Piper Sandler just raised their price target from $387 to $455.

A portfolio diversifier

Another dividend stock with strong momentum right now is UnitedHealth Group (UNH). It appears to be benefiting from the rotation out of Big Tech.

Zooming in on the dividend here, the yield isn’t high. Currently, it’s only about 1.4%. However, the payout is rising rapidly – over the last three years, it has grown by an average of 14.7% per year.

An attractive yield

Finally, check out the confectionery company Hershey Co (HSY). It offers the highest yield of the lot at around 2.8%.

Hershey has a great long-term track record on the dividend front, having registered more than 10 consecutive annual increases now. Over the last three years, the payout has grown by about 42%.

The rise of GLP-1 weight-loss drugs and soaring cocoa prices are risks with this stock. But in the long run, Hershey's iconic brand and investments in innovation should continue to drive growth.

SPONSORED & WRITTEN BY MASTERWORKS

Over the last seven elections, this asset class has outpaced the S&P 500

Instead of trying to predict which party will win, and where to invest afterwards, why not invest in an ‘election-proof’ alternative asset?

The sector is currently in a softer cycle, but over the last seven elections (1995-2023) blue-chip contemporary art has outpaced the S&P 500 by 64%, regardless of the victors, and we have conviction it will rebound to these levels long-term.

Now, thanks to Masterworks’ art investing platform, you can easily diversify into this asset class without needing millions or art expertise, alongside 65,000+ other art investors.

From their 23 exits so far, Masterworks investors have realized representative annualized net returns like +17.6%, +17.8%, and +21.5% among assets held longer than one year.

It's easy to get started at Masterworks, and our readers can skip the waitlist here.

Last Week’s Poll Results

Who do you think will win the 2024 presidential election?

🟩🟩🟩🟩🟩🟩 Donald Trump

🟨🟨🟨🟨🟨🟨 Kamala Harris

Which stock do you think will outperform over the next 12 months?

🟩🟩🟩🟩🟩🟩 Nike

🟨🟨🟨⬜️⬜️⬜️ Ulta Beauty

Are you bullish or bearish on Vistra (VST) over the next 12 months?

🟩🟩🟩🟩🟩🟩 🐂 Bullish

🟨⬜️⬜️⬜️⬜️⬜️ 🐻 Bearish

Past performance is not indicative of future returns. Investment involves risk. See Important Reg A Disclosures at masterworks.com/cd. Past performance is not indicative of future returns. Investment involves risk. See Important Regulation A disclosures at masterworks.com/cd. The content is not intended to provide legal, tax, or investment advice. No money is being solicited or will be accepted until the offering statement for a particular offering has been qualified by the SEC. Offers may be revoked at any time. Contacting Masterworks involves no commitment or obligation. “Net Annualized Return” refers to the annualized internal rate of return net of all fees and expenses, calculated from the offering closing date to the date the sale is consummated. IRR may not be indicative of Masterworks paintings not yet sold and past performance is not indicative of future results. For additional information regarding the calculation of IRR for a particular investment in an artwork that has been sold, a reconciliation will be filed as an exhibit to Form 1-U and will be available on the SEC’s website. Masterworks has realized illustrative annualized net returns of 17.6% (1067 days held), 17.8% (672 days held), and 21.5% (638 days held) on 13 works held longer than one year (not inclusive of works held less than one year and unsold works). Contemporary art data based on repeat-sales index of historical Post-War & Contemporary Art market prices from 1995 to 2023, developed by Masterworks. There are significant limitations to comparative asset class data. Indices are unmanaged and a Masterworks investor cannot invest directly in an index.