June 1st - The Week Ahead

Together With

The Week Ahead Of Us 🔍

Welcome back!

We can’t believe it’s June - it’s unreal how fast this year has gone. I hope you all have some great summer plans you’re looking forward to. Futures are down slightly to start the month. Let’s get into it - Harry

A Note on Private Credit Jobs: Buyside Hub is helping hire an entry-level/analyst level position at a leading Private Credit manager in Austin, Texas. Additionally, Buyside Hub is helping fill a Senior Associate role in a large Private Credit manger in Boston, MA. Both roles are on the top of the Buyside Hub job board - Learn more and Apply by joining here.

Here’s a look at earnings this week.

• Monday: Campbell Soup, Science Applications International Corporation (SAIC)

• Tuesday: CrowdStrike, Ferguson, Dollar General, Hewlett Packard Enterprise (HPE)

• Wednesday: Dollar Tree, Five Below, Thor Industries, PVH Corp.

• Thursday: Broadcom, Lululemon, Samsara, DocuSign, Brown-Forman, Ciena, Vail Resorts, Victoria’s Secret

Here’s a look at economic data this week (estimates are in quotations).

• Wednesday: ADP employment (112k), ISM services PMI (52.2), S&P final U.S. services PMI (52.3), Fed Beige Book (2pm)

• Thursday: Initial jobless claims (240k), 1Q GDP (revised to -0.2%), 1Q Corporate Profits (-$118.1B)

• Friday: May nonfarm payrolls (125k), unemployment rate (4.2%), average hourly earnings m/m (0.3%), y/y (3.8%), April consumer credit ($10.2B)

Earnings Corner 📜 

Costco (COST) $COST ( ▲ 1.6% )  : The membership warehouse club beat on revenue and EPS, but tariff costs pressured margins. Costco posted 8% y/y sales growth and $4.28 in EPS vs. $4.24 est, topping estimates. Management flagged tariff driven supply chain shifts, including rushing imports ahead of U.S. tariffs and rerouting goods from high tariff regions. While Costco historically does not provide formal guidance, executives pointed to selective price increases and continued strength in staples such as gas and groceries.

Dell Technologies (DELL) $DELL ( ▼ 2.87% )  : Dell beat on revenue, missed EPS, and raised guidance as AI demand surges. Revenue topped expectations at $23.38 billion, while EPS had a $0.14 miss. Management raised its full-year outlook to $9.40 and flagged $7 billion in planned AI server shipments from a $14.4 billion backlog, highlighting strong enterprise and cloud momentum.

Ulta Beauty (ULTA) $ULTA ( ▲ 0.89% )  : Beat on revenue and EPS, with full-year guidance raised Ulta delivered $2.8 billion in revenue, up 4.5% y/y, and EPS of $6.70, both ahead of expectations. Comparable sales rose 2.9%, though gross margin slipped and SG&A costs increased. Management raised full-year EPS guidance but flagged continued cost pressures and macro uncertainty.

Learn with High Yield Harry

Harry here - I want to talk more about of product suite:

Buyside Hub: As you saw, we’re recruiting for two private jobs at top managers - access our free job board and learn about wall street compensation analytics by signing up here.

Autopilot my portfolios: High Yield Harry recently launched 4 portfolios on Autopilot including The Golden Age of Private Credit portfolio and the Tariff Trade portfolio. You can autopilot the trades and strategies by signing up here.

Recruit for Investment Banking: High Yield Harry and a group of Investment Bankers put together a 248 page deck for those recruiting for Investment Banking - sign up for free here to learn more about our decks.

High Yield Harry’s Newsletter: Hundreds of readers pay for HYH Premium - a library of credit recruiting resources and a dozen city guides. Professionals have used the materials to land jobs in credit and private equity - learn more about HYH Premium here.

Advice for Interns: On LinkedIn, I had a 15 bullet point list of advice for incoming interns and younger investment professionals - view it here.

Today’s Headlines 🍿 

• Trump doubles down on tariffs: Steel and aluminum tariffs are jumping from 25% to 50%, effective June 4

  • As a result, U.S. steel producers like Cleveland Cliffs are soaring, up 33% after hours

  • EU preps a counterpunch: Brussels is expected to propose retaliatory tariffs by July 14 — or sooner if pressure mounts — with autos, agriculture, and luxury goods potentially in the crosshairs

• China tensions escalate (again): Trump accused China of violating its recent trade de-escalation agreement, reigniting fears of a tariff spiral. A Trump-Xi call is expected, but no date is on the calendar

• Musk exits the scene: Elon Musk has reportedly distanced himself from White House advisory efforts to refocus on Tesla — Trump is said to be questioning whether the initiative had any real value, although Musk has complained that Congress didn’t allow him to do the bulk of what he wanted to do

• Palantir’s new federal contract: Palantir has secured a $795mm federal contract to create a data platform that ties together the information of millions of Americans 

• Ukraine hits Russia: Ukraine has struck more than 40 Russian bombers, hitting an air base nearly 3,000 miles away from Ukraine

• Wall Street tower seeks $850M for residential conversion: Developers are seeking an $850 million construction loan to convert Manhattan's 111 Wall St. into over 1,500 apartments, marking one of the largest office-to-residential conversions in the city

• Taser CEO tops 2024 pay rankings: Axon’s Rick Smith leads WSJ’s annual CEO compensation list with a $165mm package, driven by stock awards that surpassed Apple’s Tim Cook and Blackstone’s Stephen Schwarzman

• Saks does a deal away from existing lenders: Saks, the struggling retailer, announced a $30mm FILO and incremental $50mm TL from SLR Credit Solutions. This comes as the borrower held a no-questions call with lenders where an adjusted loss of $100mm was revealed within the Saks business (although Adj. EBITDA was $161mm when incorporating Neiman Marcus). The bonds are still trading at deeply distressed levels (around 45 cents)

• Tariff chaos fuels private credit boom: With syndicated loan volumes down 15% YoY, dealmakers are leaning into private credit as trade uncertainty pushes borrowers to quieter, quicker transactions

• Apollo bets big on private credit trade: Apollo is partnering with JPMorgan and Goldman Sachs to syndicate investment-grade private debt more broadly — a major push to bring scale to the once-niche market

• Private credit under pressure: A new 9fin chart shows a growing list of private credit borrowers in non-accrual status — a warning sign as higher rates and tighter terms bite

• Bloomberg raises questions over Egan-Jones’s Private Credit Ratings: Bloomberg did a deep dive piece this evening on how The Egan-Jones Rating Company has quickly become Private Credit’s go-to provider of credit ratings, with some questions regarding whether the 20-person team is misrating these borrowers

• Jamie Dimon flags bond risk: The JPMorgan chief is raising red flags around the bond market, citing volatility and mispricing risks amid Fed uncertainty and global political instability

• SBF gets the Hollywood treatment: Julia Garner and Anthony Boyle will star as Caroline Ellison and Sam Bankman-Fried in The Altruists, a new limited series dramatizing the fall of FTX

• Stanley Fischer dies at 81: The former Fed vice chair and Bank of Israel governor passed away Saturday. Fischer mentored a generation of central bankers, including Bernanke and Draghi, and was a key figure in New Keynesian economics

• HSBC exits U.S. small biz banking: HSBC is shutting down its U.S. business banking division serving small and mid-sized firms with revenues up to $50mm. The move affects about 4,400 clients and 40 employees, as the bank doubles down on Asia and the Middle East under CEO Georges Elhedery

• Harvard dubbed China's 'Party School': Thousands of Chinese Communist Party officials have studied at Harvard, earning it the nickname “party school” among elites. The Trump administration is now targeting these academic ties, citing national security concerns

• Taylor Swift reclaims her masters: Taylor Swift has officially regained ownership of her first six albums, ending a long campaign to gain control of her early music. The acquisition marks a significant victory in her years-long battle over her master recordings

M&A Transactions💭 

Rangers Football Club, is being acquired by a consortium led by 49ers Enterprises, the owner of the San Francisco 49ers and Leeds United. The club said the group committed to invest 20.0M pounds right away.

The Rail Operating Leasing Business Unit of Wells Fargo has entered into a definitive agreement to be acquired for $4.4B by a Joint Venture (Brookfield Infrastructure Partners and GATX). Wells Fargo advised on the sale.

Villages Bancorporation, operator of a banking platform, has reached a definitive agreement to be acquired for $710.8M by Seacoast Bank (NAS: SBCF). Hovde Group advised on the sale.

TicketManager, developer of an event and guest management platform, was acquired for $110.0M by Valeas Capital Partners.

Churchill Management Group, provider of financial services, has entered into a definitive agreement to be acquired for $10.1B by Focus Financial Partners. Berkshire Global Advisors advised on the sale.

Brightflag, developer of an AI-based enterprise legal management platform, has reached a definitive agreement to be acquired for EUR 425.0M by Wolters Kluwer Legal & Regulatory Solutions.

Acumatica, developer of cloud-based enterprise resource planning software, has entered into a definitive agreement to be acquired for $2.0B by Vista Equity Partners. Jefferies and Moelis & Company advised on the sale.

Shimizu Shintech, wholesale of electronic equipment, has reached a definitive agreement to be acquired for $5.182B by Shinko Shoji (TKS: 8141). EV/Revenue was 85.21x.

L.B. White Company, manufacturer of electronic heating equipment, has reached a definitive agreement to be acquired for $112.0M by Modine Manufacturing (NYS: MOD). EV/Revenue was 3.2x.

Klasse Auto, operator of car dealerships, was acquired for $10.0B by Mr Son Oh-Gong.

Geronimo Power, provider of renewable electricity generation services, was acquired for $1.735B by Brookfield Asset Management (TSE: BAM).

Encino Acquisition Partners, operator of a holding company, has reached a definitive agreement to be acquired by EOG Resources (NYS: EOG) for $5.6B.

Phoenix Global, provider of steel mill support services, has reached a definitive agreement to be acquired for $325.0M by Suncoke Energy (NYS: SXC). Moelis & Company advised on the sale.

Kraft, operator of a dispensing pharmacy business based in Tokyo, has reached a definitive agreement to be acquired for JPY 59.1B by Ain Holdings (TKS: 9627).

Private Placement Transactions💭 

Snorkel AI, developer of an AI intelligence powered programmatic data labeling tool, raised $100.0M of Series D venture funding led by Addition at a pre-money valuation of $1.2B.

ClickHouse, developer of an online analytical processing database management system, raised $350.0M of Series C venture funding led by Khosla Ventures at a pre-money valuation of $5.65B.

Green Energy Global, a renewable and sustainable energy-focused company, raised $211.0M of venture funding from undisclosed investors.

TOCA Football, operator of a soccer game company, raised $135.0M through a combination of Series F1, Series F2, Series F3 venture funding from undisclosed investors at a pre-money valuation of $410.0M.

GRIN Therapeutics, operator of a biopharmaceutical company, raised $410.0M of Series D venture funding from Angelini Pharma and Blackstone.

Odds of the Day 🍒 

Kalshi traders are pricing in a 77% chance of OKC taking game 1 of the NBA Finals.

*New Traders on Kalshi receive a $20 bonus of trading credit when depositing $100+ with the code “HYH”.

Noteworthy Chart 🧭

Meme Cleanser 😆 

Until next time!

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Investment advice provided by Autopilot Advisers, LLC (“Autopilot”), an SEC-registered investment adviser. Past performance does not guarantee future results. Investing carries risks, including loss of principal. As always be smart out there.