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Together with Betterment
Happy Sunday.
Hell of a morning we’ve had — shoutout to Trump for pumping my crypto bags.
Let’s dig into things!
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Now let’s dive right in.
Portfolio Updates (YTD Performance):
Not much to report on when it comes to portfolio updates.
I’m really excited that I focused on building such a large position in Berkshire Hathaway during Q3 / Q4 of 2024 — as we navigate market volatility this position seems to really help round out the rough edges.
The largest technology names (Magnificent Seven), as defined as my “Long Technology” subsection of my portfolio, are really struggling this year. On the flip side, my “Long Risky” subsection is leading the charge.
In my opinion, we’re still on track to experience multiple double-digit percentage pullbacks in the markets this year. With that being said, I plan to use them as opportunities to increase my positions in some of the best-of-breed names in my portfolio across all subsections.
Stay tuned for a detailed breakdown of those names and reasons why I’m excited to buy their dips!
Week in Review —TLDR:
HIMS to realize $725M in GLP-1 demand, Home Depot raises dividend by +2%, Lowe’s continues to see soft big-ticket demand, Trump’s big crypto announcement, Amazon unveiled Alexa+, PayPal 2.0 has arrived, Mexico’s proposal to match U.S. tariffs on China, the Atlanta Fed revealed a shocking GDP projection, PCE inflation provided some slight relief to the market, and consumer confidence continues to fall.
Key Earnings Announcements:
HIMS to realize $725M in GLP-1 demand, Home Depot raises dividend by +2%, and Lowe’s continues to see soft big-ticket demand.
Hims & Hers Health (HIMS)
Key Metrics
Revenue: $481.1 million, an increase of +95% YoY
Operating Income: $18.6 million, compared to -$0.4M last year
Profits: $26.0 million, an increase of +2,066% YoY
Earnings Release Callout
“2024 was a fantastic year at Hims and Hers as we continue to build a platform that leverages personalization and technology unlike any traditional healthcare system. The success we are experiencing is a direct reflection of our improving ability to democratize access to high quality, personalized care across each of our specialties. This evolution is positioning us to serve tens of millions of individuals over time while simultaneously progressing toward our long-term profitability targets.”
My Takeaway
As a quick reminder, this company was my first ever 10X for a stock! Super excited to see this name continue to flourish.
HIMS reported a mixed bag of results — revenue beat Wall Street’s expectations while their Adj. EBITDA came in slightly lower-than-expected. The company provided bullish 2025 guidance that was well-above Wall Street’s expectations due to continued GLP-1 demand. The company now expects their weight-loss offerings to contribute at least $725M in revenue for 2025.
Last Friday the FDA announced that it had officially declared an end to Ozempic and WeGovy’s nationwide shortage, which started back in 2022. Eli Lilly also announced price reductions of its GLP-1 products on its LillyDirect self-pay offering.
Looking toward the rest of 2025, there’s still a lot to be excited about — they’re expected to grow revenue by +60%, their Adj. EBITDA margin is expected to expand, and their membership model continues to print free cash flow for shareholders.
With that being said, I’ll begin trimming this position as we creep back to all-time highs again. It’s been a fun ride, but it’s never smart to keep so much profit at play. Trim and diversify is the name of the game for me!
Home Depot (HD)
Key Metrics
Revenue: $39.7 billion, an increase of +14% YoY
Operating Income: $4.5 billion, an increase of +8.5% YoY
Profits: $3.0 billion, an increase of +7% YoY
Earnings Release Callout
“Our fourth quarter results exceeded our expectations as we saw greater engagement in home improvement spend, despite ongoing pressure on large remodeling projects.
Throughout the year, we remained steadfast in our investments across our strategic initiatives to position ourselves for continued success, despite uncertain macroeconomic conditions and a higher interest rate environment that impacted home improvement demand. I would like to thank our associates for all that they do to serve our customers and communities.”
My Takeaway
Quarterly comparable sales came in better-than-expected, marking the first positive in nine quarters. However, management’s guidance came in marginally lower-than-expected, reinforcing Wall Street’s view that the company continues to operate in a sluggish demand environment.
While Pro trends remain healthy, big-ticket discretionary projects remain pressured by financing sensitivity. Despite existing home sales likely experiencing a bottom right now, Home Depot expects the overall home improvement market to only improve slighting throughout 2025.
A key positive, however, remains management’s ability to control costs — allowing the company to continue to report growing earnings and dividends for their investors.
I continue to hold a position in Home Depot, and will opportunistically buy any weakness in the stock.
Lowe’s (LOW)
Key Metrics
Revenue: $18.5 billion, compared to $18.6 billion last year
Operating Income: $1.8 billion, an increase of +8% YoY
Profits: $1.1 billion, an increase of +10% YoY
Earnings Release Callout
“Our results this quarter were once again better-than-expected, as we continue to gain traction with our Total Home strategic initiatives. We remain confident in the long-term strength of the home improvement industry, and we are equally confident in our strategy to capitalize on the expected recovery.”
My Takeaway
While comparable sales for Lowe’s, similar to Home Depot, exceeded expectations and trended positive for the first time in nine quarters, the company’s 2025 outlook remained cautious in nature. This reinforces the view that a meaningful demand recovery needs to further develop before we see a material move higher with their stock.
While big-ticket categories, like kitchen and bath, remain under pressure — Pro continues to outperform (up high-single digits) as Lowe’s gains traction with small-to-medium sized Pros. The company recently launched their Pro Loyalty program, which should further solidify their standing with small-to-medium sized Pros — with investments in supply chain and improved digital capabilities should provide incremental tailwinds.
As with Home Depot, I continue to see a balanced risk / reward here for Lowe’s stock. I’ll opportunistically buy any weakness.
Investor Events / Global Affairs:
Trump’s big crypto announcement, Amazon unveils Alexa+, PayPal 2.0 has arrived, and Mexico’s proposal to match U.S. tariffs on China.
Trump Announces Crypto Reserve
President Trump announced that BTC, ETH, XRP, Solana (SOL), and Cardano (ADA) will be included in a proposed U.S. Crypto Reserve as part of efforts to strengthen the country’s digital asset sector. This initiative follows an executive order establishing a working group to assess the potential for a national digital asset stockpile and create clear regulations for the industry.
The move is seen as a response to what Trump calls attacks on crypto by the Biden administration, aiming to counter regulatory pressures. Some insiders are concerned that the plan could impact Bitcoin’s dominance, but the proposal has generated optimism about the future of the crypto market. Trump will host the first White House Crypto Summit next Friday — bringing together industry leaders, CEOs, and investors to discuss the future of digital assets. The summit will be chaired by AI & Crypto Czar David Sacks and Executive Director Bo Hines.
We’ll see if other coins will be included as the week goes on. I’d imagine there will be more announcements at Friday’s White House event… so stay tuned!
What a WILD piece of news to break on a Sunday!
Amazon’s Alexa+ Announcement
Source: Brendan McDermid / Reuters
Amazon is launching Alexa+, a generative AI-powered upgrade to its voice assistant, next month, starting with Echo devices with displays and expanding later. This update aims to make Alexa more conversational and personalized — allowing users to interact naturally and access features like booking reservations, managing home security footage, and analyzing documents. Amazon executives highlighted Alexa’s ability to integrate with smart-home devices and third-party services like OpenTable, though concerns remain about usability on screenless devices.
The upgrade comes after delays and previous struggles to monetize Alexa, with Amazon having lost over $25 billion on its devices business by 2021. Despite falling behind AI competitors like ChatGPT and Google’s Gemini, Amazon hopes its cloud infrastructure will give it an edge in generative AI. However, questions remain about its accuracy, ease of use, and ability to truly compete with advanced AI assistants from rivals.
Amazon (AMZN) Stock Performance, 5-Year Chart, Seeking Alpha
“The latest evolution of generative AI is here. Meet Alexa+, our smartest, most conversational, and personalized AI assistant to date. Alexa+ is designed to leverage state-of-the-art architecture that connects LLMs, agentic capabilities, third-party services, and more to your devices. Alexa+ costs $19.99 per month or free to all Amazon Prime members, and will start rolling out in the U.S. in the next few weeks.”
PayPal Investor Day
Source: PYMNTS
PayPal unveiled its "PayPal 2.0" strategy at its Investor Day, aiming to transform from a payments company into a full commerce platform. Key initiatives include PayPal Open for merchants, expanded partnerships with Verifone and J.P. Morgan, and the launch of Fastlane in Europe & the U.K.
AI will play a major role in unifying the company’s vast consumer and merchant data, improving personalization, and accelerating product development. The company is enhancing its "pay everywhere" approach with new payment options like an NFC wallet in Germany, instant bank transfers, and automated rewards stacking in the PayPal Wallet. PayPal is keenly focused on merchants, streamlining onboarding, boosting conversion rates with Fastlane, and expanding Buy Now, Pay Later (BNPL) offerings.
Looking ahead, PayPal plans to tap into the $2 trillion B2B bill pay market and integrate its stablecoin, PYUSD, into business transactions by the end of 2025.
PayPal (PYPL) Stock Performance, 5-Year Chart, Seeking Alpha
“This is a new PayPal. Call it PayPal 2.0. Call it the next chapter.”
Tariff Updates
Source: Vincent Alban / Bloomberg via Getty Images
U.S. Treasury Secretary Scott Bessent highlighted Mexico’s proposal to match U.S. tariffs on China and encouraged Canada to follow suit to form a "Fortress North America" against Chinese imports. Mexican officials are willing to raise tariffs on Chinese goods and increase U.S. imports to avoid Trump’s threatened duties on their own exports. Trump recently imposed an additional 10% tariff on Chinese goods, adding to existing tariffs from both his and Biden’s administrations. Mexico’s proposed tariffs would likely target cars, auto parts, and other finished goods — aligning with U.S. pressure to limit Chinese influence.
Canada has already imposed tariffs on Chinese electric vehicles, steel, and aluminum, with further tariffs on critical minerals and semiconductors being considered. Mexico’s efforts aim to prevent a 25% tariff set to take effect on March 4, which Trump linked to fentanyl and undocumented migration issues. In addition to trade discussions, Mexico has strengthened security cooperation with the U.S., extraditing 29 accused drug traffickers. Mexican officials continue negotiations with their U.S. counterparts, discussing both trade and financial measures to address drug cartels and money laundering.
“When it comes to the US and their own concerns, we’re able to have conversations — we’re very open to have also trade-related conversations, including when it comes to China.”
Major Economic Events:
The Atlanta Fed revealed a shocking GDP projection, PCE inflation provided some slight relief to the market, and consumer confidence continues to fall.
The Atlanta Fed’s Shocking GDP Projection
The Atlanta Federal Reserve predicts a -1.5% contraction in GDP for the first quarter, a sharp reversal from its previous estimate of +2.3% growth just a week ago. This drop follows strong GDP growth in prior quarters, with the fourth quarter at +2.3% and the third at +3.1%, raising concerns about an economic slowdown. Inflation remains a challenge, with the personal consumption expenditures (PCE) price index at +2.5% annual growth and consumer sentiment plunging in January.
Uncertainty over economic policies from the Trump administration, including fluctuating tariff decisions, has unsettled businesses and consumers. Analysts warn that these signs of weakening confidence could lead to further economic turbulence, with 61% of CEOs last year expecting a recession within six months.
“There is early evidence that current policy uncertainty is impacting consumer and business confidence… These early signs of weakening confidence could lead the U.S. administration to adopt a more considerate approach to spending cuts and tariffs. Alternatively, the current policy sequencing may result in the market pricing a heightened risk of recession first.”
PCE Index Provides Some Relief
The Federal Reserve’s preferred inflation measure, the personal consumption expenditures (PCE) price index, rose +0.3% in January, with an annual increase of +2.5%. Excluding food and energy, core PCE also climbed +0.3% for the month, bringing the yearly rate to 2.6%, slightly lower than December’s revised +2.9%. Personal income increased sharply by +0.9%, surpassing expectations, but consumer spending unexpectedly declined by -0.2%.
The personal savings rate jumped to 4.6%, indicating caution among consumers despite rising incomes. Fed officials remain cautious about cutting interest rates, waiting for stronger signs that inflation is sustainably returning to their 2% target. Market expectations for a June rate cut rose slightly, with traders now seeing a 70% chance of a quarter-point reduction. Meanwhile, goods prices increased +0.5% in January, driven by higher motor vehicle and gasoline costs, while services rose more moderately at +0.2%.
“Growth of labor income has been cooling, a potential headwind for personal income going forward. Overall, though, inflation continues to move toward the 2% target, spending contracted, and we expect February payrolls (out March 7) to be weak. The economic trajectory still suggests that once the current rates pause is finished, the Fed’s eventual next move will be a cut.”
Consumer Confidence Falls
U.S. consumer confidence fell sharply in February, dropping -7 points to 98.3, marking the largest decline since August 2021 and the third consecutive monthly decrease. The decline was broad across age groups and income levels, with increasing concerns about labor market conditions, future incomes, and business outlooks. Inflation expectations for the next year rose to their highest since May 2023, driven by price increases in essentials like eggs and fears of additional costs from Trump’s proposed tariffs.
Federal Reserve officials, including Chair Jerome Powell, have indicated they will keep interest rates steady until inflation shows more progress toward their +2% target. Consumers are also cutting back on big-ticket purchases, with fewer planning vacations and more expressing worries about job security and layoffs. This decline in sentiment aligns with broader market uncertainty, as stocks and bond yields fell following the report.
“Post-election swings in consumer attitudes tend to be short-lived, with consumers focusing more of fundamentals like jobs and incomes. Recent financial-market turbulence reflects uncertainty over how Trump administration policies will impact inflation, jobs and the economic outlook.”
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