RJ Hamster
🦉 The Night Owl Newsletter for November 23rd
Unsubscribe Trump’s national nightmare is here (From Porter & Company)DoorDash’s Recent Stock Dip Equals 60% UpsideWritten by Sam QuirkeShares of DoorDash Inc. (NASDAQ: DASH) were trading just under $200 on Thursday, down more than 30% from October highs but still holding firm near support around $198.The sharp pullback followed the company’s earnings earlier this month, which missed expectations on earnings per share (EPS) and unveiled heavy FY26 spending plans across robotics, fulfillment, and Deliveroo expansion—a move that investors worried would dent near-term profits.They were quick to signal their skepticism, and shares sank as fears around the company’s short-term profitability grew. But with the selloff having wiped out several months of gains, many analysts see it as an opportunity.After weeks of heavy selling, the stock is starting to show signs of rebounding, jumping more than 10% earlier this week as buyers stepped back in. As we enter the final weeks of 2025, could DoorDash offer one of the strongest comeback plays for Q4? Let’s take a closer look. Fundamentals Still Support the StoryAs stated above, the company missed expectations on its earnings—but its latest revenue figures were ahead of the consensus, with the core business in solid shape. DoorDash orders and revenue are still growing at decent rates, and the company continues to dominate the U.S. delivery market while expanding into new categories like grocery and retail. Even amid a tougher consumer environment, user engagement remains strong, and the platform’s scale supports operational efficiency. Importantly, management’s new investment push seems more proactive than reactive. The focus on automation, logistics, and international expansion through Deliveroo should help the company extend its lead and reinforce profitability once the initial spend is absorbed. In other words, these are strategic investments to sustain growth, not signs of weakness.Analysts See the Selloff as an OpportunityThe pullback has created what several analysts are calling a textbook buying setup. The team at Needham, for example, reiterated its Buy rating last week, viewing the 30% decline as excessive given DoorDash’s consistent execution.They note the company has more than doubled its gross order value in just four years, clear evidence that its model is working.Needham expects adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to keep growing at a strong clip, with organic sales and Deliveroo’s contribution easily offsetting near-term cost pressures.Their view is that these investments are necessary to maintain DoorDash’s trajectory, even if they temporarily weigh on results.Mizuho Securities also reaffirmed its bullish stance, keeping an Outperform rating and a $320 price target, implying roughly 60% upside from current levels.Their argument was similar to Needham—this is a company whose long-term strategy remains intact, and its shares are trading at a deep discount right now. Together, these views suggest that the recent drop was more about sentiment than substance, and it appears to be a short-term correction rather than the start of a downtrend.Technicals Point to Early AccumulationThe chart is already starting to tell this story. Shares have been showing signs of support around $198, and the stock’s relative strength index (RSI) has been pushed down to extremely oversold territory.This week’s bounce suggests buyers are already stepping back in, and the bears could soon be getting tired. If the stock continues to consolidate into next week, it would confirm that the worst of the selling is likely behind it.Risks to WatchDoorDash is not out of the woods yet, though, and the bears will argue that its spending plans are poorly timed. A shaky risk appetite among equity investors and a missed EPS number make for a poor combination right now, especially given existing valuation concerns. Competition from Uber Eats and emerging grocery delivery rivals could also keep pricing pressure high.Still, it’s difficult to ignore the company’s market-leading position and its ability to scale profitably over time. The issue isn’t whether DoorDash will continue to grow, but how quickly it can convert that growth into cash flow. For investors willing to look past short-term noise, this dip looks like it could be an opportunity worth taking seriously. READ THIS STORY ONLINEBuy Alert (Ad)Most investors won’t touch stocks under $10.They think “cheap” means “junk.” They’re wrong. While the crowd chases the same overpriced tech giants, a handful of sub-$10 stocks just triggered massive catalysts that Wall Street hasn’t fully priced in yet. The smartest money always moves before the crowd realizes what’s happening.CLICK HERE TO GET YOUR FREE COPY OF THIS REPORTWall Street Loves Williams-Sonoma Right Now—Here’s Why the Stock Could Soar in 2026Written by Thomas HughesWilliams-Sonoma’s (NYSE: WSM) Q3 results and the resulting price action prove its quality as a buy-and-hold stock and a hot ticket for 2026.Hallmarks include a healthy balance sheet, cash flow, and capital returns, which underpin the stock price action. While growth is a factor, it is the company’s ability to drive cash flow and pay its investors that counts, and it is pretty capable of doing so.The dividend distribution is approximately 30% of earnings, which are among the highest quality in the industry. The company targets a mid-to-high teens operating margin and has been delivering at the high-end of its range or higher for several years. The critical detail is that balance sheet health, cash flow, and growth support annual distribution increases and sustainable share repurchases. While the dividend is attractive at 1.4% as of mid-November, the share buybacks are more so.The company aggressively repurchases shares, having reduced the count by an average of 2.6% in FQ3, and is on track to continue reducing the count in the upcoming year. The Q3 earnings report included a fresh, billion-dollar increase to the repurchase authorization, which increased the allotment to over $1.6 billion, sufficient to sustain the Q3 pace for the next six quarters.Looking ahead, tailwinds may develop for this business in 2026 as interest rate reductions work their way through the economy.  Williams-Sonoma Proves Its Value in Q3 With Growth Across All BrandsWilliams-Sonoma had a solid Q3 despite macroeconomic headwinds and the subsequent impact on consumer habits. The company reported $1.88 billion in revenue, a 4.4% increase that outpaced MarketBeat’s consensus estimate and was on par with the retail industry average. The outperformance is not insignificant at over 530 basis points, and strength was reported across all brands.Systemwide, comps ran at 4%, with the flagship Williams-Sonoma brand up 7.2%, trailed by 4.2% at Pottery Barn Kids, 3.3% at West Elm, and 1.3% at Pottery Barn.Margin news is where the company’s strengths shine. Gross margin expanded by 70 basis points, offsetting an increase in SG&A tied to compensation awards and advertising. Compensation awards aren’t bad as they are linked to the company’s favorable performance, while advertising begets sales. The critical detail is that the operating margin expanded by 10 basis points, enabling a leveraged 12.8% increase in net earnings and bottom-line outperformance. GAAP EPS outperformed by 500 basis points, and the strength is expected to persist. Revenue guidance was reaffirmed, but the margin outlook was improved. Turning to the balance sheet, Williams-Sonoma raises no red flags. The Q3 highlights include increased cash, receivables, and inventory, as well as year-over-year increases in current and total assets, with liabilities rising at a slower pace and equity increasing. Equity improved by 10% to just over $2 billion, leaving total leverage very low. The company has no long-term debt, and its total liability is about 2.55 times its equity. Analysts Forecast Double-Digit Upside for WSM StockAnalyst response to Williams-Sonoma’s release is mixed.The three updates posted within the first two hours include a reaffirmed Outperform rating and $230 price target, as well as two price target reductions.Still, all three targets are above the consensus, aligning with trends pointing to the high end and a potential new all-time high.The primary concern is tariffs, but they appeared to be priced into the results.Guidance is forecasting above-consensus results and factors, including business momentum and October’s labor data. Job growth, unemployment, and wages were all stronger than expected, suggesting a good holiday season relative to forecasts. As it stands, the consensus is a move to $200, while the high end is pegged at $230. READ THIS STORY ONLINETrump’s national nightmare is here (Ad)Porter Stansberry and Jeff Brown say a new U.S. national emergency is already underway — and it could trigger the biggest forced rotation of capital since World War II.They reveal why Trump is mobilizing America’s tech giants… and name the two stocks most likely to soar as trillions shift behind the scenes.WATCH THE NATIONAL EMERGENCY BROADCAST HEREMeta Wins FTC Fight, Keeps Instagram Growth Machine IntactWritten by Leo MillerMagnificent Seven giant Meta Platforms (NASDAQ: META) just got a significant weight lifted off its shoulders.Back in April, MarketBeat detailed Meta’s legal battle that posed a potentially existential threat to the company.Luckily, Meta emerged as the victor. Below, we’ll dive into the outcome of the company’s Federal Trade Commission (FTC) lawsuit and what it means going forward. First, let’s gain an understanding of why this trial is so important.Losing Instagram and WhatsApp Would Have Shaken Meta to Its CoreBack in 2020, the United States FTC sued Meta on the grounds that the company engaged in anti-competitive practices. Specifically, the regulator claimed that Meta’s acquisitions of Instagram and WhatsApp gave the firm too much power within the social media landscape.After the court dismissed and reopened the case multiple times, an official trial began on April 14, 2025. The worst-case outcome for Meta would have had devastating implications. The company would have had to sell Instagram and/or WhatsApp, two platforms that are critical to its future prospects. In particular, Instagram has been a massive growth driver for Meta.According to eMarketer, Instagram accounted for around 7% of Meta’s U.S. advertising revenue a decade ago. The marketing research firm estimates that in 2025, that figure will surpass 50% and will rise to over 53% in 2026.eMarketer also believes that Instagram monetizes its users more effectively than any social media platform. It estimates that Instagram will generate nearly $250 per user, on average, in 2025. That’s around 90% higher than the $132 estimate for TikTok and more than six times the $40 estimate for YouTube. Note that eMarketer released these estimates at the end of 2024, and the numbers may have changed considerably.However, the data shows the absolutely vital role that Instagram plays in Meta’s growth. Losing it would have removed what is arguably the company’s most important revenue driver.Additionally, while Meta’s WhatsApp revenues are likely around $2 billion today, the platform has significant growth potential going forward. Analysts at Wolfe Research have estimated that WhatsApp’s total addressable market is in the range of $30 billion to $40 billion annually.While this does not mean Meta will hit these numbers any time soon or ever, it is still a large opportunity. Meta is likely already making significant progress in growing WhatsApp revenue. The company houses WhatsApp in its “Other Revenue” line item. Other Revenue last quarter was $690 million, up around 59% compared to a year ago. Overall, WhatsApp also represents a key asset that Meta by no means wants to lose.Crisis Averted: Meta Puts FTC Lawsuit to BedOn Nov. 18, Judge James Boasberg ruled against the FTC and in Meta’s favor. The company will not have to part ways with Instagram or WhatsApp, a monumental victory. Ultimately, while Meta may have held a social media monopoly in the past, the judge does not believe it does now. This is true considering that Meta faces significant competition today, particularly from TikTok. When the lawsuit began in 2020, TikTok was still in its infancy. In the trial, Meta itself acknowledged that it faces “fierce competition.” On the day of the decision, Meta shares closed down around 0.7%, slightly less than the S&P 500’s 0.9% loss.This reflects the fact that markets overwhelmingly anticipated that Meta would win the case. As a result, they did not reward the stock for the ruling. Still, removing the huge potential threat posed by the case is an indisputable positive for the company. It will allow the firm to focus more on its long-term objectives and fend off competition.Meta’s Recent Fall Needs Important ContextMeta shares have fallen around 22% since releasing its Q3 earnings report.However, this period has also seen an approximately 10% drop in the S&P 500 tech sector.Thus, while much of Meta’s fall is specific to the company, it has been significantly exacerbated by overall tech weakness.Despite its slide, Wall Street analysts generally remain bullish on the stock.The MarketBeat consensus price target of $825 implies 40% upside potential.Among analysts issuing price targets after the company’s Q3 earnings report, the average target is $852. This figure suggests shares could rise nearly 45%. READ THIS STORY ONLINEThe memecoin system that’s delivered 20+ massive winners (Ad)What if you could spot the next 8,200% memecoin before it explodes? 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