What You Need To Know for September 4th

Together with Pegasus

Welcome back!

Tech is quickly recovering following Google carrying the market higher yesterday - we’ll get into that more below. Meanwhile, Trump has asked the Supreme Court to take up the appeals court tariff ruling, as expected.

Quick job alert note - we’re helping with two searches at a leading NYC Private Credit firm - apply directly on Buyside Hub for a Credit Analyst role and an Investor Relations role.

Let’s get into it. But first, we revamped our referral program that the WSR Investing Club is live - here’s the details below:

A look at our revamped referral program:

Earnings Corner 📈 📉

Salesforce $CRM ( ▲ 1.42% ) Revenue and EPS beat. Sales climbed 10% y/y, from by steady demand for Agentforce and core enterprise software, while margins held steady. The company returned cash by $2.2B in buybacks and a dividend. Guidance was below street expectations, sending the stock down pre-market

Macys $M ( ▲ 20.68% ) roared higher yesterday with a revenue beat at $4.8B vs $4.6B estimates and EPS came in above consensus. The 125 Bloomingdale’s, Bluemercury, and Reimagine stores drove the strongest sales comps in 12 quarters. Raised sales and profit outlook on momentum from its “Bold New Chapter” turnaround, though tariffs and holiday softness remain risks.

Signet $SIG ( ▼ 1.97% ) Revenue and EPS beat. Margins expanded on stronger bridal and fashion, while comps rose 2% with Kay, Zales, and Jared up 5%. Guidance was raised as Q3 sales are seen modestly ahead and the 2026 outlook was lifted for revenue and earnings.

Dollar Tree $DLTR ( ▼ 8.37% ) Revenue and EPS beat, but tariffs are a massive concern rn. Store sales rose 6.5% fueled by more traffic and larger purchasing sizes, led by higher income shoppers. Margins outperformed despite the tariff pressure, supported by price adjustments and store conversions. The $1B Family Dollar sale is complete, so the company is now fully focused on the Dollar Tree banner. Guidance was raised to $19.3B–$19.5B sales and $5.32–$5.72 EPS, though tariffs tanked the stock.

By the way, on Tuesday we published a pre-earnings report on Lululemon for WSR Investing Club members. To make sure you gain access to these notes, upgrade to the WSR Investing Club

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Today’s Headlines 🍿 

• Google jumps on avoiding an antitrust breakup: The stock climbed 9% after the judge ruled the company won’t be forced to divest Chrome. Increased competition from AI is the main reason Google was able to avoid severe punishment, with the judge stating that “the emergence of GenAI changed the course of this case”

• Apple is planning to launch its own AI based search next year - The "answer engine" is expected to enhance and overhaul Siri in the Spring of next year. Google’s Gemini and Anthropic’s Claude models will likely be used in the new system, which may eventually be added to Safari and Spotlight

  • The Google ruling is also good news for Apple - they will continue to get their $20B annual payments for making Google the default search engine in Safari. Apple stock rose ~4% today

• NFL RedZone won’t be ad free: Commercials are coming to the show after ESPN bought it last month, although host Scott Hanson promises that “we will not miss a touchdown”

  • Meanwhile, The Profile revealed that Saquon Barkley has built an impressive portfolio of venture investments. The running back has written check to several high-growth startups including Anthropic, Anduril, and Ramp

• Elliott is taking a stake in Pepsi and pushing for the company to refranchise its bottling business, a move that was successful for rival Coca-Cola back in 2017. The activist has built a ~$4B stake in Pepsi, which has struggled in recent years as the demand for soda declined and their market share slipped. Elliott believes their ideas - which also includes eliminating less popular offerings - could boost the stock by at least 50%, and Pepsi has said it would review their proposal

• John Malone’s thoughts on the media landscape: The Liberty Media chair predicts “there’ll be a lot of consolidation” in a streaming world that has too many players, creating economic inefficiencies. Malone cites a need for media companies to control the customer relationship and says that there isn’t room for “six or even five” companies to do that

• KraftHeinz is splitting up: Hot dogs and ketchup will be together no more as the company is breaking up into two separate companies - one for sauces/spreads/seasonings and another for slower-growing grocery staples like Oscar Mayer, Capri Sun, and Lunchables. The split aims to create businesses with more focus and less complexity as demand has weakened for some core products. Shares fell 4% since the announcement

• Bessent is set to interview Fed Chair candidates starting Friday: There are 11 contenders for the job, including Fed governors Christopher Waller and Michelle Bowman, National Economic Council Director Kevin Hassett and former Fed governor Kevin Warsh. Afterwards, Bessent will send a list of final candidates over to Trump

  • Speaking of Waller, he favors multiple cuts, saying that the Fed should get ahead of a slowdown in the job market and that he’s not worried about tariff inflation. As one of the 11 candidates set to be interviewed, Waller is likely jockeying for a Fed Chair position

• Fed Beige Book flags sluggish growth: The survey found businesses hesitant to hire amid weaker sales, trade-war uncertainty, and a shrinking immigrant workforce, while tariffs added only “moderate” inflation so far. Consumers are pulling back as wages lag prices, strengthening expectations for a rate cut at the Fed’s September 16–17 meeting

• A government shutdown could be coming soon: Congress is trading blame as negotiations continue to avoid a shutdown by the September 30th deadline

• ConocoPhillips to slash up to a quarter of staff: The oil producer plans to cut 20–25% of its 13,000-strong workforce. Falling crude prices, higher costs, and margin pressure have forced Conoco and peers like Chevron and BP to scale back headcount and drilling plans

• Investors pile into CLOs despite thin margins: CLO issuance has topped $320B through mid-August, a record pace, as managers lock in cheap funding and bet on a rebound in leveraged loans. The flood of demand has pushed loan spreads to near rock-bottom levels, even though today’s deals offer some of the slimmest profits for managers in years

• Great Hill closes $7B fund: The Boston-based buyout shop raised Great Hill Equity Partners IX in just five months, beating its $5B target and hitting the $7B hard cap. The growth-focused firm, now managing over $19B, will keep targeting software, fintech, health care and consumer deals—bucking the wider PE fundraising slowdown

• BSP closes $2.3B continuation fund: Benefit Street Partners and Coller Capital have closed the largest single-fund private credit continuation vehicle to date, anchored by a portfolio of senior secured loans. The deal extends the life of BSP’s 2016 direct lending vintage and underscores how secondaries are reshaping private credit liquidity

• Jefferies faces invoice-finance exposure: The bank’s hedge fund arm, alongside UBS O’Connor and others, has financed billions in customer invoices tied to auto-parts maker First Brands Group. The company, which shelved a $6B loan last month, is now under Deloitte review amid scrutiny of its off-balance-sheet financing and aggressive debt-funded acquisitions

• Nuveen teams up with Hunter Point and Temasek on private debt: The investment manager is taking on minority investments from the duo as a part of its foray into the corporate financing market

• IPO Latest:

  • Klarna’s IPO: The Swedish buy now, pay later company aims to raise up to $1.27B through its IPO on the NYSE. Shares will be priced between $35 and $37 each, valuing the company at $14B

  • Black Rock Coffee eyes Wall Street debut: The drive-through coffee chain is seeking to raise up to $265M on Nasdaq, valuing it near $861M at the top of the range. With 158 locations and double-digit same-store sales growth, the company is pitching itself as the next challenger to Starbucks and Dutch Bros

  • Blackstone-backed Legence files for IPO: The HVAC and building-systems firm is targeting up to $754M in its debut, valuing the company at about $2.9B. With $2.8B in backlog and a focus on data centers and complex projects, Legence pitches growth despite widening losses and heavy BX control

  • Winklevoss twins take Gemini public: The crypto exchange is seeking up to $317M, valuing it near $2.2B at the top of the range. Despite heavy losses, Gemini is pitching itself as a Trump-era crypto play, joining Circle and Bullish in tapping public markets after pro-stablecoin legislation

M&A Transactions💭 

York Holdings Company, operator of a holding company focused on strategic investments, was acquired by Bain Capital for JPY 814.7B. Mitsubishi UFJ Morgan Stanley Securities advised on the sale.

Royal Automobile Club of Queensland, provider of automotive support services, was acquired for $855.0M by Insurance Australia Group (ASX: IAG).

Renewed Hope, operator of a holding company, was acquired by Siam Food Services for MYR 1.051B.

Old Point National Bank (NAS: OPOF), functions in the financial services domain, was acquired for $203.0M by TowneBank (NAS: TOWN). EV/Net Income was 31.30x and EV/Revenue was 4.33x. Stifel Financial and Keefe, Bruyette & Woods advised on the sale.

Isla Delice, producer of processed meat products, has reached a definitive agreement to be acquired for EUR 150.0M by A&M Capital.

Beenos Partners, engages in the electronics commerce business, was acquired for JPY 53.8B by LY Corporation (TKS: 4689). EV/EBITDA was 14.19x and EV/Revenue was 2.94x. DC Advisory US advised on the sale.

Tietoevry Tech Services, provider of IT services, was acquired for EUR 300.0M by Agilitas Private Equity. EV/Revenue was 0.16x. Bank of America advised on the sale.

Statsig, developer of digital product testing platform, was acquired for $1.1B by OpenAI.

SIFI, operator of an ophthalmic company, was acquired for EUR 270.0M by Faes Pharma (MAD: FAE). Evercore Group advised on the sale.

Rothschild & Co reached a definitive agreement to acquire the UAE Operations of Liechtensteinische Landebank (SWX: LLBN).

The Containerboard Business of Greif (NYS: GEF) was acquired by Packaging Corporation of America (NYS: PKG) for $1.8B. EV/EBITDA was 8.49x and EV/Revenue was 1.5x. Goldman Sachs advised on the sale.

Fredon Industries, manufacturer of electronic products, was acquired for $200.0M by NRW Holdings (ASX: NWH).

Environmental Disposal Systems, provider of disposal services, has entered into a definitive agreement to be acquired for $750.0M by Deep Blue Midland Basin. Piper Sandler advised on the sale.

Bridge Investment Group Holdings (FRA: 53S), a vertically integrated investment manager, was acquired for $1.974B by Apollo Asset Management (NYS: APO). EV/EBITDA was 91.19x and EV/Revenue was 4.96x. Bank of America, J.P. Morgan, and Lazard advised on the sale.

Air Lease Corporation (NYSE: AL), a global aircraft leasing company, has agreed to be acquired by a consortium led by Sumitomo Corporation and SMBC Aviation Capital, alongside Apollo and Brookfield, for $65.00 per share in cash (enterprise value ~$28.2B)

Apollo Syndicate Management, provider of underwriting and syndicate management services, has reached a definitive agreement to be acquired for $555.0M by Skyward Specialty Insurance Group (NAS: SKWD). Evercore Group advised on the sale.

DD Group, engaged in offering the management and planning of the food and drink business, was acquired for JPY 24.34B by Polaris Capital Group.

Private Placement Transactions💭 

Anthropic, developer of a large language model platform, raised $13.0B of Series F venture funding led by Lightspeed Venture Partners, Fidelity Management & Research Company, Index Ventures, and IONIQ Capital at a pre-money valuation of $170.0B.

Kapital Bank, developer of a banking platform, raised $100.0M of Series C venture funding led by Tribe Capital and Pelion Venture Partners.

Odds of the Day 🍒 

Kalshi traders are pricing in a 34% chance of Waller becoming the new Fed Chair.

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

Meme Cleanser 😆 

Until next time!

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