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Today's big stories

Home improvement retailer Lowe’s earnings update fell short of expectations
There could be a lot of money to be made from the world's waste – Read Now
The world’s biggest shipping company Maersk upped its earnings expectations

1.

Lowe Spirits

What’s Going On Here?

One-time American sweetheart Lowe’s reported worse-than-expected quarterly earnings on Wednesday, and investors ditched the home improvement retailer’s shares.

What Does This Mean?

Sure, Lowe’s sales were better than analysts expected, thanks to twice as many online sales as the same time last year. But its profits – weighed down by store refurbishments and ecommerce investments – weren’t able to live up to estimates. Workforce expenses were a biggy too: Lowe’s has been paying its staff higher wages during the pandemic, and the move's cost it $1 billion in the first nine months of the year. Still, at least that's not Home Depot money: Lowe’s DIY rival reported costs closer to $2 billion on Tuesday.

Why Should I Care?

For markets: Home isn’t necessarily where the heart is.
Lowe’s shares took off after the coronavirus outbreak. That’s mostly because its status as an “essential retailer” allowed the company to keep its doors open during lockdown, and because it hoovered up cash that would’ve been for holidays instead of home improvements. But with its sales growth slipping from summer peaks, the question for investors now is just how sustainable those gains will be. Maybe Lowe’s ought to follow Target’s example: the discount retailer reported an increase in its market share on Wednesday, which should set it up for success when the pandemic’s behind us.

The bigger picture: Tough lux.
Shopping habits are changing left, right, and center, but one of the most notable shifts is in luxury spending. China’s now set to become the biggest luxury market by 2025 according to consultancy Bain, with the country’s wealthiest traveling less and splurging more on home turf (tweet this). At least that gives luxury retailers something to look forward to after a terrible 2020: this year won’t just see the sector’s first drop in sales since 2009, it’ll see the biggest drop in sales ever – and things aren’t expected to get back to pre-pandemic levels till 2023.

You might also like: How Lowe’s ecommerce business measures up to a world-leading ecommerce company.

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2. Analyst Take

Why Garbage Is More Treasure Than Trash

What’s Going On Here?

According to a report by the World Bank, waste could be growing twice as fast as the global population by 2050.

And that’s just not a major environmental issue: it’s going to have massive implications for the companies that are developing new ways of repurposing trash – companies that you can invest in, by the way.

That might be why public stock funds focused on the so-called “circular economy” have increased sixfold since the start of 2020, swelling to over $2 billion.

Take a look at today’s Insight to find out what the circular economy’s all about, as well as how cockroach factories could play a big part in it…

Get the full Insight here

🥂 Wine down this holiday season

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To get started, take Bright Cellars’ simple, seven-question quiz, and they’ll match you with wines from all over the world right away.

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3.

Thar She Blows

What’s Going On Here?

Thank goodness Maersk navigated these troubled waters without making too much mess on the poop deck: the shipping company upped its earnings expectations on Wednesday.

What Does This Mean?

The world is moving again: there were 1% more containers on the move last quarter compared to the same time last year, and Maersk transports around a fifth of them. And with so many shipments to make, the company’s now raised its profit expectations for the second time in as many months.

Maersk doesn’t even seem to be worried about the global surge in coronavirus infections. Lockdowns or no lockdowns, after all, shoppers are still spending their money. If anything, they’re spending it on flatscreens and games consoles rather than nights out with friends, which are notoriously difficult to ship in a metal container.

Why Should I Care?

For markets: Maersk schmaersk.
Maersk’s considered to be a bellwether stock for global trade, which means its recovery is a good sign for broader economic activity. Goldman Sachs might feel especially vindicated by the shipping company’s outlook: the investment bank is predicting that US economic growth will reach 5.3% in 2021 – far better than consensus expectations of 3.8%. As for US stocks, it reckons they’ll climb from current levels by almost 20%.

The bigger picture: Bad business.
If transport’s back up and running, the business world doesn’t seem to have got the memo: tech guru Bill Gates thinks business travel will be cut in half even when COVID-19 is under control. That isn’t something airplane maker Boeing wanted to hear: airlines aren’t going to need as many of its planes if there are fewer people flying for work, which is the most lucrative part of air travel. Talk about bad timing: its 737 Max airplane has just been cleared to fly again after an almost two-year ban…

You might also like: How global trade determines the economic growth outlook.

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💬 Quote of the day

“Never be limited by other people’s limited imaginations.”

– Mae Jemison (an engineer, physician, and the first African-American female astronaut)

Tweet this

🤔 Q&A · RE: Brain Freeze

“If shareholders aren’t allowed to sell stock for a period of time after an initial public offering (IPO), who can?”

– Lucrezia in Milan, Italy

“To make sure everyone reading this is on the same page, Lucrezia: what you’re referring to is a ‘lockup’, which prohibits pre-IPO investors from selling their shares until a certain point after a company’s debuted on the stock market. That stops them from flooding the stock market with more shares than there’s demand for, dragging their price down. But an IPO usually creates new shares, which investors can buy and sell on the stock market without any restrictions. And at the same time as that IPO, a company’s existing investors can actually sell some of their shares, in what’s known as a secondary sale.”

🙋 Ask a question

🌏 Finimize Community

✨ This sparks joy

What’s the point of money if it doesn’t bring you joy? That’s Julia Newbould’s take on things: the co-author of ‘The Joy of Money’ wants to help you reframe your relationship with money, and turn it into something that actually makes your life more meaningful.

😊 The Art of Finding The Joy of Money with Julia Newbould: 5.30pm Perth Time, November 19th
🤔 Avoiding the Common Pitfalls of Bonds: 11am Vancouver Time, November 23rd
🤖 The Rise of Blockchain: 7pm Dubai Time, November 25th
💸 The Finimize Induction with CEO Max Rofagha: 1.30pm UK Time, November 27th
🚀 Next Gen Investor Summit: 12pm UK Time, December 1st

📚 What we're reading

The most brazen case of voter fraud you’ll see all year (AV Club)
So we’re about 9,000 years behind then (Popular Science)
How COVID is impacting CLUBBING (DJ Mag)

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Finimize - 🔨 Lowe's needs lockdown

Today's big stories

Lowe Spirits

What’s Going On Here?

What Does This Mean?

Why Should I Care?

Why Garbage Is More Treasure Than Trash

🥂 Wine down this holiday season

Thar She Blows

What’s Going On Here?

What Does This Mean?

Why Should I Care?

✨ This sparks joy

Older messages

💰 Airbnb's billions 'n' billions

🎉 Keep those vaccines coming

😧 Disney's crushing Netflix

🤫 Goldman writes off 2020

😢 Vaccines won't save oil

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