5-Chart Friday (11/13/20)

By Charlie Bilello

13 Nov 2020


5 charts from the past week that tell an interesting story in markets and investing…

1) Vaccine Reversal

The big news this week came early on Monday with reports of 90% effectiveness in Pfizer’s covid-19 vaccine.

The initial reaction was a massive reversal in the “covid trade” with companies hurt most by the virus rallying (Cruises, Airlines, Hotels, Commercial Real Estate), and companies who benefitted most from the virus selling off (eCommerce, Video Conferencing, Home Exercise and Pools, etc.).

While Pfizer initially spiked higher on the news, it would then pull back 11% in the next 3 days and is now flat on the year. Trading is never easy.

Created in YCharts

Hopefully, the effectiveness of the vaccine will hold up as the phase 3 trial continues, bringing an end to this scourge in 2021. The vaccine’s impact on the virus will depend in part on how many people take it. From a recent poll this week, it seems that more than half are currently hesitant to be the first in line. I would expect that to change as we get more data on its safety in the coming months.

2) The Great Migration

Americans are on the move, migrating at a faster pace than we’ve seen in years.

Metro areas they are leaving…

Source: Redfin

Metro areas they are moving to…

Source: Redfin

3) High Low Yield

US High Yield bond yields hit an all-time low this week: 4.76%.

Created in YCharts

4) Hospitalization Highs

Covid-19 hospitalizations in the US hit a new high this week, surpassing the prior high from the summer.

Created in YCharts

Hospitalizations are rising in all regions, with the Midwest showing the most severity on a per capita basis.

Image

5) Uber Losses, Uber Gains

Uber’s net income declined $1.1 billion in the 3rd quarter, following a consistent pattern…

Uber Net Income:

  • Q3 2020: -$1.1 billion
  • Q2 2020: -$1.8 billion
  • Q1 2020: -$2.9 billion
  • Q4 2019: -$1.1 billion
  • Q3 2019: -$1.2 billion
  • Q2 2019: -$5.2 billion
  • Q1 2019: -$1.0 billion
  • Q4 2018: -$0.9 billion
  • Q3 2018: -$1.0 billion
  • Q2 2018: -$0.9 billion

Revenue’s declined 18% from a year ago as travel remains depressed, the second straight YoY decline.

What’s going on with its stock price? New all-time highs this week.

How is that possible?

Investors are clearly looking ahead to better days, and viewing passage of Prop 22 (exempting Uber from classifying drivers as employees) as a big win as well.

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And that’s it for this week. Thanks for reading.

Have a great weekend everyone!

-Charlie

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About the author

Charlie Bilello

Charlie is the founder and CEO of Compound Capital Advisors.

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