Netflix and Not Chill

Sponsored By April 21 2022 Good morning traders, Welcome back to The Daily Setup. Markets were mixed yesterday- the Dow rose, the S&P was relatively flat, and the Nasdaq was dragged down by Netflix. Here’s what’s on the docket today: - Netflix is today’s biggest loser - Tesla sees an 81% jump in revenue - Just Eat has buyer’s remorse of Grub Hub Don’t forget to swing by our new section at the bottom, Meeting with the Bobs. We’ll post the best responses (anonymously) in tomorrow’s newsletter. Nick How'd the markets look? Market Outlook Netflix and Not Chill Biggest Mover [Activision Blizzard, Inc. ]( Odds are that the employees at the last Blockbuster in Bend, Oregon held a party yesterday. Whether it was for Netflix’s loss of subscribers or for 4/20 is tbd. During Wednesday’s trading session, shares of Netflix (ticker: NFLX) saw its biggest one day drop since 2004. The company, which reported Q1 earnings after the bell Tuesday, announced a [loss of 200,000 subscribers during the first quarter](, which is well short of what the 2.5M the company [told investors to expect](, and even further from the 2.7M analysts were projecting. Worst of all, this is the first time the ‘flix has lost subscribers in over a decade. The stock finished the day down [35.1%]( and wiped out roughly $50B in market cap. - [The company cited headwinds]( (still using that phrase huh) that include, “increasing competition, slowing smart TV adoption, password sharing, and macroeconomic developments.” As someone who uses their parent’s Netflix account, I’m part of the problem. - The company is now saying they [can lose up to 2M subscribers in Q2]( and are mulling the idea of a lower-priced ad-supported offering. So, basically Netflix is inventing television. Wednesday’s action saw NFLX break [December 2018’s low of $231.23](, and between October and November 2017, the stock traded in a range from [$190-$205](. I’m keeping NFLX on my watchlist as we may see some volatile trading between $190-$231 over the next few weeks. Oh, and Bill Ackman, who bought 3.1M shares of NFLX in January, is now down roughly $300M on the trade. Couldn’t have happened to a nicer guy. Tesla Beats Street Street Stories [Cycling Downhill] Shares of Tesla (ticker: TSLA) were up [5%]( in after-hours trading Wednesday following the release of their Q1 earnings. Elon’s brainchild beat The Street’s estimates on both the top and bottom line thanks to a 67% increase in vehicle deliveries and 81% increase in revenue on a year-over-year basis. - [Q1 EPS]( came in at $3.22/share on $18.8B in revenue vs. analysts’ estimates of $2.27/share on $17.9B in revenue. - [Vehicle deliveries](, which is the closest metric analysts can use to approximate the financial health of the company, increased from 184,877 in Q1 2021 to 310,000 in Q1 2022. - The shuttering of its factory in Shanghai, which has since partially reopened, combined with the continued increase in raw material costs, may hamper growth in upcoming quarters. The Great Recession, Covid, and the crisis in Ukraine are just a few of the most recent shocks to the financial markets. However, one could argue that the Fed’s responses to these events, in the end, will end up doing more harm to investors than the actual catalysts for the drawdowns in the first place. The longer the Fed props up the market, the more pain investors will feel when that safety net is pulled out from under their portfolios...and the Fed has been propping up the market for a long time now. To borrow one of Jerome Powell’s favorite catch phrases, I gotta stay nimble when adding to my portfolio. Sponsored By: The most damn comfortable jeans on earth. Because they STRETTTTTCCCCCHHHHH. Like more than any other jeans you’ve ever worn. That’s why they have more than 10K [⭐][⭐][⭐][⭐][⭐] reviews by dudes of every shape and size. They’re practically the anti-jeans—so flexible you could do yoga in them. [Introduce your legs to their new best friends here.]( They’re practically the anti-jeans—so flexible you could do yoga in them. [Introduce your legs to their new best friends here.]( Let's face it, everyone needs to wear pants, why not enjoy the pants you have to ware! Save 10% on us! Use our Coupon Code SETUP10 Today! [GET YOURS TODAY!]( *See Disclaimer Below Potential for a Spot Bitcoin ETF Token Talk [Token Talk] Crypto nerds and ETF issuers received some positive news on the spot Bitcoin ETF front. The SEC and its band of morons misfits gave regulatory approval for a Bitcoin Futures ETF issued by Teucrium earlier this month. [What makes this approval unique]( is that Teucrium, which sounds like an anti-itch cream, “filed its successful application under the “33 Act” (or the Securities Act of 1933) and the “34 Act” (Securities Act of 1934), rather than the “40 Act” (the Investment Company Act of 1940) that the SEC approved all previous bitcoin futures ETFs under.” - [SEC Chair Gary Gensler]( said last year that, “he felt [more comfortable with 40 Act]( funds because of the investor protections enshrined within the law, as well as the market surveillance tools overseeing the futures market.” The fact Teucrium’s offering was approved under acts 33 and 34 may be hinting at a change of heart by the SEC. - Many ETF issuers, like VanEck, have voiced their displeasure with the SEC’s stance on spot Bitcoin ETFs, saying it’s a “big loss for investors.” And themselves, I’m sure. The negative sentiment should grow even louder after it was announced that [two spot traded crypto ETFs from 21Shares]( will begin trading in Australia next week. If I'm an avid crypto investor, I would pay attention to how this plays out as an approval in the U.S. on a Bitcoin spot ETF will allow investors a way to play the futures against the spot price, as well as, allowing for both buying and selling in the direct crypto underlying. Currently, investors can only go long crypto, limiting the speculative ability of the asset class, and keeping bid-ask spreads wider. Can You Say Buyer’s Remorse? Deals and Rumors [Deals and Rumors] Less than a year after purchasing Grubhub for $7.3B, Just Eat Takeaway.com, which ranks up there with all-time horrible company names, has said that it is [exploring a full or partial sale]( of its U.S. arm of Grubhub. Since its purchase in June 2021, the Amsterdam-listed shares of Just Eat (ticker: [TKWY]() have dropped roughly 64%. What is most shocking about this story, though, is that people actually still use Grubhub. - The company [lowered its full-year 2022 growth-transaction-value]( from the mid-teens to the mid-single-digits. No bueno. - Just Eat’s EBITDA, which was a gain of $393M in 2020, ended 2021 with a loss of $380M. [Not great, Bob](. - The company’s second largest shareholder, Cat Rock Capital, is pressuring Just Eat to sell, while [Lucerne Capital Management]( has said that it would, “vote against the reappointment of Just Eat’s chief financial officer at its annual meeting in May.” Both seem like valid ideas. [Just Eat competitors](, DoorDash, Delivery Hero and Deliveroo are down 26%, 73% and 56% respectively over the same period. With Covid restrictions easing and people going back to restaurants for some porch beers in the summer, taking a long position in one of the above companies may be a dicey proposition. Unless the above companies restructure their pricing strategy, it may be a while before the food delivery sector starts to claw back the losses they’ve suffered over the past 6-9 months. Link Roundup Other News Other News Link Roundup + Millennials, No Choice But to Rent - Median Home Prices in March Set Record ([link]() + Now What Are They Going to Use to Launder Money - New Round of Sanctions Against Russian Bank, Oligarchs, & Crypto Miner ([link]() + Nerds Investors Love Themselves Some Software - Nasdaq Profit Tops Estimates ([link]() + Only for Betas - Coinbase launches its NFT beta ([link]() + There’s no better troll than Elon - Elon hints again about a tender offer for Twitter ([link]() Meme of the day Tempting, very tempting, [via @TrungTPhan]( [other news] Meeting with the Bobs [other news] Welcome to [Meeting with the Bobs](. Reply directly to this email to respond, and feel free to be creative as possible. Yesterday’s question: What’s your favorite show from a streaming service that’s not netflix? Some sent in ‘Dope Sick’ from Hulu, which is about the opioid crisis. Highly recommend- my girlfriend and I are on the last episode. Today’s question: Would you invest in a spot bitcoin ETF? 62 Calef Hwy #233 Lee, New Hampshire 03861 United States Questions or concerns about our products? Email our team here support@thedailysetup.com © Copyright 2022, [RagingBull]( - [Refund Policy]( - [Privacy Policy]( - [Terms & Conditions]( SPONSORED AD PLACEMENT: This email contains an advertisement by a party that is unaffiliated with Raging Bull. Raging Bull does not in any manner recommend or endorse any stock, investment or service that is the subject of this advertisement.. DISCLAIMER: To more fully understand any Ragingbull.com, LLC ("RagingBull") subscription, website, application or other service ("Services"), please review our full disclaimer located at [(. 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