Seven biggest tech stocks; Why Sheryl Sandberg Quit Facebook's Meta; My Meta presentation slides; Tennis and conversation with Patrick McEnroe
1) I thought this chart (courtesy of NYU marketing professor Scott Galloway) was very interesting:
2) Speaking of Meta Platforms (FB), the company was in the news last week when longtime COO Sheryl Sandberg announced her departure. She leaves behind a complicated legacy, which is covered in these articles:
- Why Sheryl Sandberg Quit Facebook's Meta (Wall Street Journal)
- Sheryl Sandberg's Legacy (New York Times)
- Just Spoke to Sheryl... (Puck)
I agree with Galloway and tech columnist Kara Swisher who, in their Pivot podcast episode Sheryl Sandberg's Next Move (starting at 23:02), say that had she left in 2017, she would have been a hero and might well have been elected president. But after all of the scandals since then, she's damaged goods.
Technically, Sandberg is being replaced by Javier Olivan, who has been with the company since 2007 and most recently was chief growth officer – here's a Twitter thread with background on him.
But in reality, my sources tell me that the person who's really running things now is Chris Cox, the chief product officer who serves as chief of staff to CEO Mark Zuckerberg on product development and is responsible for Meta's "family of apps": Facebook, WhatsApp, Instagram, and Messenger. My sources tell me he's very strong.
Here's a NYT article about him and other top Meta executives: Who Is Mark Zuckerberg's New No. 2? It's a Trick Question. Excerpt:
The four top lieutenants are Andrew Bosworth, the chief technology officer; Nick Clegg, the president of global affairs; Chris Cox, the chief product officer; and Mr. Olivan, who was the head of growth, Mr. Zuckerberg said in a Facebook message about Ms. Sandberg's exit on Wednesday.
Each of the four men has major responsibilities. Mr. Clegg is the public face and ambassador for Meta, while Mr. Bosworth is pushing the company into the immersive world of the so-called metaverse. Mr. Cox oversees Meta's family of apps – Instagram, WhatsApp, Messenger and Facebook – and Mr. Olivan will be in charge of analytics, infrastructure, and growth...
Mr. Cox, 39, who became chief product officer in 2005, has often been described by employees as the heart of the company. He left Facebook in March 2019 but returned in June 2020, prompting speculation that Mr. Zuckerberg may have been signaling him as a successor.
Given that Meta is an original recommendation in our two flagship newsletters, Empire Stock Investor and Empire Investment Report, I'm more interested in the investment implications of Sandberg's departure.
Again, the news here is good – my sources tell me she was "dead weight," and former senior insiders are buying.
3) I presented Meta as one of my favorite ideas at the Empire Financial Research event my colleague Berna Barshay and I hosted last Thursday in New York City. Here are a few of the slides I presented:
This is one of the strangest market mispricings I've ever seen. Meta should trade at a substantial premium to IBM (IBM), which has been a value trap for more than two decades:
Yesterday we sent our subscribers a link to the 75 slides Berna and I presented last Thursday, along with a video of the entire event (including the Q&A).
In addition to my full presentation on Meta, I shared my updated slides on Berkshire Hathaway (BRK-B) and the cannabis sector, highlighting our latest recommendation in Empire Investment Report.
Berna also went through her in-depth research on Netflix (NFLX), and I shared Enrique's slides on his favorite idea today (he was sick, so he couldn't join us).
During the Q&A, I highlighted Twitter (TWTR), Berna discussed one of her highest-conviction small-cap names, as well as Target (TGT) and Walmart (WMT), and we both explained why we think oil prices will remain much higher than the market expects them to for many years to come – this makes us bullish on energy stocks.
If you'd like to access the slides and video, you can become a subscriber – and receive a full year of our flagship newsletter, Empire Stock Investor – for only $49 right here.
4) I went to a YPO (Young Presidents' Organization) event last night where the special guest was Patrick McEnroe.
He did a tennis clinic with a half-dozen of us (at age 55 – my age – he still has game!), then made some remarks and took questions during the cocktail hour and stayed for dinner, so I had a chance to chat with him for 15 minutes.
Unlike his infamously foul-tempered brother, John, who's nearly eight years his senior, Patrick is a super nice, easygoing guy.
I asked Patrick how many Grand Slams he thinks Carlos Alcaraz will win, and he said eight to 10. He also thinks Jannik Sinner will win a Grand Slam and that Serena Williams won't win another. I agree...
Here's some background on Patrick for those who are interested...
Though he was always in John's shadow as a player, he had a strong tennis career, reaching No. 28 in singles, winning one tournament (the Sydney Outdoor Championships in 1995), and reaching the semis in one Grand Slam, the 1991 Australian Open, where he reached the semifinals before being knocked out by eventual-champion Boris Becker. (This is funny: Commenting on his fellow semifinalists, he told the press: "It's just like you all expected – Edberg, Lendl, McEnroe, and Becker.")
Patrick had more success in doubles, reaching No. 3, winning one Grand Slam (the 1989 French Open), and reaching the final in another (1991 Australian Open).
He was the captain of the U.S. Davis Cup team from 2000 to 2010, the longest tenure of any captain, and coached the team to a championship in 2007.
From 2008 to 2014, Patrick served as General Manager of USTA Player Development and was captain of the U.S. men's tennis team at the 2004 Summer Olympics in Athens.
He has worked for ESPN since 1995 covering tennis as an analyst, studio host, and doing play by play.
Best regards,
Whitney
P.S. I welcome your feedback at WTDfeedback@empirefinancialresearch.com.