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Market Scorecard
It is no secret that 'Team Vestact' is not a fan of tobacco stocks. We even had a short on British American Tobacco for a while, let's just say that we got smoked. Our view has been that smoking is on the way out, and at some point, the strong cash flows from these companies will disappear. When will that day happen? I am not sure. When it does the exit will not be big enough for everyone. Yesterday Phillip Morris dropped 16% due to disappointing sales numbers.
Overall tobacco stocks have had a tough 2018. I see that Goldman Sachs moved Phillip Morris off of their conviction buy list, but still has the stock listed as a buy. I'm happy to watch the share price action from the sidelines.
Found at Philip Morris Results Stoke Global Tobacco Stock Sell-Off
Yesterday the JSE All-share closed down 0.32%, the Dow closed down 0.34%, the S&P 500 closed down 0.57%, and the Nasdaq closed down 0.78%.
Our 10c Worth
One thing, from Paul
As you know, Vestact is heavily invested in the healthcare sector. Broadly speaking, the demand for new drugs and personal services is rising as the human population gets older and richer.
An exciting area to follow is genome medicine. The Human Genome Project was an international scientific research effort which culminated in 2003 with the mapping of the sequence of nucleotide base pairs that make up human DNA. Subsequent declines in genome sequencing costs have allowed scientists to identify the genes that determine attributes from our eye colour to the risk of developing heart disease.
The cost of sequencing a single human genome has fallen faster than Moore's law would predict, to about $1,000 currently. Industry analysts believe that this cost could further decrease to $100 per genome in the future. Illumina, Inc. (Nasdaq listed code: ILMN) is the global leader in high throughput genome sequencing technology.
The CRISPR/Cas9 gene editing system allows scientists to target the genetic cause of a disease and repair it at the source by replacing or editing genes or introducing genetically-engineered cells. In other words, by delivering the Cas9 nuclease complexed with a synthetic guide RNA (gRNA) into a cell, the target cell's genome can be cut at the desired location, allowing existing genes to be removed and/or new ones added. How cool is that!? Two leading companies in this field are Editas Medicines (Nasdaq listed code: EDIT) and Intellia Therapeutics, Inc. (Nasdaq listed code: NTLA).
Goldman Sachs estimates that genome medicine has transformative potential across the entire spectrum of disease categories including cancer, neurology, ophthalmology, liver and represents a $4.8 trillion total addressable market in the decades to come.
Byron's Beats
The easier it is to pay for things, the more you will buy. It is a fact. People make impulse decisions, and if the online check out process is longer than 5 minutes, chances are you will think twice about your purchase and often pull out.
That is why Visa and MasterCard have been working hard on developing a one-click check out process. It is so crucial that the rivals have decided to collaborate on the one-stop payment button.
This is good news for both payment businesses as well online retailers - Visa, MasterCard may team up on shared payment button for online shopping
Bright's Banter
Apple Music has enjoyed some great success of late. On the 13th of March this year, Barbados born pop star Rihanna became the first female artist to have over two billion streams on Apple Music, topping artists like Taylor Swift, Adele, Ariana Grande, Selena Gomez, and Beyonce.
On the 6th of April, Cardi B dropped her debut album "Invasion of Privacy" which conveniently coincided with the Mark Zuckerberg's appearance on Capitol Hill around the issue of invasion of privacy, but we digress. Seven days later, on the 13th of April Cardi B's album, Invasion of privacy amassed over 100 million streams on Apple Music. More than doubling Taylor Swift's record from her album, Reputation, to become the fifth most-streamed album of all time on Apple Music, surpassing The Weeknd's Starry and Ed Sheeran's Divide.
This brings us to today, the 20th of April or famously known as 4/20 (Google it). Today J. Cole released a fire album called KOD, which you can listen to on Apple Music below. This album is also going to break a few records and win a few awards, that's just how the Cole world works.
All of this is great for Apple Music because it means people will subscribe to the services so they can get these albums as they drop. Instead of having to wait a few days until they come out on CDs or other music streaming services. This makes us happy Apple shareholders because the music industry continues to thrive, artists are paid their worth for their content, and Apple helps lower the illegal downloading of music.
I'm out, stay woke and download all these albums on your Apple Music and enjoy the music.
Company Corner
Booking Holdings, formerly know as Priceline just bought FareHarbour, a company specialising in local activities and experiences - Booking Holdings Buys Activities Distribution Startup FareHarbor. The deal is relatively small for a company of Booking Holdings size but still looks like a good move. The goal for them is to be able to sell users more services every time they log onto their respective sites. Here is what the company had to say:
- "Today travel is fuelled by technology, yet the local experiences and attractions marketplace is still largely offline," said Gillian Tans, CEO of Booking.com. "FareHarbor's technology allows local tours and attractions to easily bring their businesses online. We see an immense opportunity to leverage this technology to bring more local experiences online, benefitting the entire global travel ecosystem for both consumers and local businesses by allowing them to connect instantly through a seamless digital experience."
Linkfest, Lap it Up
Where consumers spend their money, highlights what is important to them. This graph highlights how low cost, and convenience are the most important things - Who's Surviving the "Retail Apocalypse"?.
You will find more infographics at Statista
Filming a battle scene in mud and sub-zero temperatures doesn't sound pleasant for just one day, now imagine doing it for 55 - Game of Thrones Has Completed a Battle Scene That Took 55Nights in a Row to Shoot.
We like owning stocks because you can get your money in and out quickly and transaction costs are low. Visual Capitalist has a cool breakdown of how some more exotic investments have performed - Investing in the Finer Things in Life
Vestact in the Media
This week on Blunders: The SA Advertising Standards Authority are Effing Idiots; KPMG is a train wreck; Ramaphosa says SA is "Open for Business"; and Armed Men Walk Into Nigerian Senate in Session and Steal Mace - Blunders: Episode 97
Bright was on SAfm doing a market wrap - Market Watcher
Signing off
Our market is slightly lower this morning. British American Tobacco is up over 1% this morning after getting crushed yesterday. There is nothing of note for data releases today. Good job on surviving two 5-day weeks, we now have another two 4-day weeks ahead of us.
Sent to you by Team Vestact.