☕ Which is the better weight loss drug company?

Good morning! 👋

All green on my screen as I type during the overnight market.  

Not sure that’ll stick for the daytime session, but I’ll take it for the simple reason that there’s still a lot of money on the move. Scuttlebutt I’m hearing from my friends in low places is consistent with the need to buy – rather than sell – shares into 2025. 

Wall Street performance bonuses are funny that way… 🤦‍ 

Imagine that. 

Here’s my playbook. 

1 – Salesforce surge 

Salesforce turned in some solid Q3 numbers and shares are pulling the rest of the market higher in early, pre-market going. (Read) 

I don’t particularly think 8% YoY growth is anything to write home about given that several of the stocks I discuss regularly instead of Salesforce are on track for far higher results. But, that’s just me. 

What I find most interesting is that CEO Marc Benioff is pushing the company’s Ai-chatbots as an example of AI-Agent technology, saying that they’re the next jump from ChatGPT and other tools powered by LLM (large language models). 

Again, I don’t share that thinking but the markets evidently do.  

That’s the important part. 

Keith’s Investing Tip: Investors quibble about valuations constantly but moves like this and results like these tend to be more about CEO alignment than anything else. So be sure the CEOs in the companies you own can lead the charge, lest they get “Gelsinger’d.” 

2 – GM’s games 

General Motors expects to incur over $5 billion in charges due to restructuring its joint venture with SAIC Motor Corp in China. (Read) 

A quick review of the documents shows that GM expects to account for the majority of it by recognizing what’s happening as “non-cash, specialty items.”  

In accounting speak, this means the $5B will NOT impact adjusted earnings before interest and taxes, something – ta da – that Wall Street analysts watch carefully. 🤦 

In other words, GM gets to take an economic hit that makes future earnings look better but is able to manipulate – ahem, proactively accommodate - the damage by stuffing it into a category that doesn’t appear too bad… just less bad.

Should you buy it?

Before you do, think very carefully about the world around us. Nearly every car maker is having a rough go of it. Nearly. 

Buy the best, ignore the rest. 

It’s a short list and I’m here if you’d like some help, not to mention potentially upping your game considerably. 

3 – Which is the better weight loss drug company? 

Eli Lilly's Zepbound outperformed Novo Nordisk’s Wegovy in a head-to-head clinical trial that showed Zepbound helped patients lose 20.2% of their body weight (roughly 50 lbs) over 72 weeks, while Wegovy resulted in a 13.7% loss (roughly 33 lbs). (Read) 

Not surprisingly, the stock performance matches up, 40.17% versus 9.61% respectively over the past 12 months. 

4 – Foot Locker biffs earnings, management swears nobody told ‘em to tie the laces  

Foot Locker choked, missing both top and bottom-line expectations. (Read) 

No surprise here. 

Expensive sneaks are “nice to have” products at a time when consumers have gone down market to retailers like Walmart where “must haves” dominate. 

I’ve said repeatedly to stay away from choices like Foot Locker but just this past Monday made the case again for Walmart on Varney & Co. (Watch) 

Hopefully, you’re on board. 

Walmart has returned 84.21% over the past 12 months while Foot Looker has returned –18.65% and the S&P 500 has turned in 32.39% by comparison over the same time frame. 

Trade Idea: Long Walmart / short or putskies on Foot Locker 

Keith’s Investing Tip: We’ve got a teaching moment at hand. Salesforce CEO Mark Benioff took control of his results noting that the company will be doing XYZ while he is focused on PDQ. Foot Locker execs, meanwhile, blamed “weaker consumer” demand rather than accepting responsibility for the fact that they executed poorly and apparently got caught by surprise. Three guesses which stock has better profit potential.  

5 – Jag’s rebranding will be studied for years, and not in a good way  

I can’t recall anybody potentially destroying an iconic brand faster nor more completely. 

Business schools will have a field day with case studies about how everything went wrong in the C-suite. 

My two cents, having made a living evaluating companies and investment potential for more than 4 decades, is that some fancy pants, high-brow agency types got the C-Suite’s ear.  

Then were given a blank check to do something creative and in return assured their benefactors that the echo chamber had more to it than appears to be the case. 

Bottom Line 

Every morning you have two choices.  

You can sleep with your dreams, or you can get up and make ‘em happen. 

You got this - I promise. 

As always, let’s MAKE it a great day. 

Keith 😃