May 28, 2021 Sign Up

By Overheard on Wall Street

“Healing is a matter of time, but it is sometimes also a matter of opportunity." – Hippocrates

Good morning! Retail investors kept meme stocks short squeezed for the third day straight, as GME rose 5% and AMC took off for the moon with a 36% gain, and was the most traded equity in the world yesterday with $13 billion exchanging hands.

1. Story of the Day: Another Unicorn Goes Public

Another day, another fintech unicorn goes public via a SPAC. On Thursday, Acorns announced that it will combine with the Pioneer Merger SPAC, valuing Acorns at $2.2 billion. Acorns is a pretty cool app that links to your credit card and automatically invests your spare change from transactions in index funds. It charges $1/month for that service but has recently added $3/month and $5/month options for additional features such as bank accounts or retirement plans. 

The pandemic has supercharged growth for many investing and trading apps as people have nothing better to do than be on their phone all day. (meme stocks have also been great for them) Investing apps such as Wealthfront and Betterment both had their best quarters to start the year. Acorns had their best three months as well, with subscribers doubling from the fourth quarter to 4 million and is projecting 8 million by 2023.

Existing investors in Acorns include companies such as PayPal and Comcast, and celebrities including Jennifer Lopez and The Rock. As part of the transaction, Pioneer would invest $400 million, with $165 million coming from a private placement including investors such as Blackrock. Strangely the company will trade under the ticker symbol $OAKS, which is the Company's analogy of growing acorns into “mighty oaks.” 

Short Squeez Takeaway: While the pandemic and meme stock frenzy has been great for investing apps (Just ask Robinhood that has 20 million users now) it remains to be seen what growth will look like once people are not sitting inside their houses 24/7 and if Acorns can hit their lofty subscriber targets.

2. Markets Rundown

• Stocks ended slightly higher on Thursday after new jobless claims came in lower than expected

Movers & Shakers

• (+) Virgin Galactic ($SPCE) +15% after recent successful test flight.
• (+) Ford ($F) 7% after RBC upgraded the stock to outperform.
• (–) Dollar Tree ($DLTR) -6% after issuing a full-year outlook lower than analysts’ projections.

3. Top Reads

4. Book of the Day: One Million Followers: How I Built a Massive Social Following in 30 Days

Taking your social media following from 0 to over 1 million in 30 days takes more than hard work and smarts. It requires having a proven process. The author (Brendan Kane) is a growth hacker for Fortune 500 companies, athletes, supermodels, and celebrities including Taylor Swift and Rihanna. Brendan outlines the different strategies he used on platforms like Instagram, Twitter, and LinkedIn. You will learn how to target your audience and create viral content. We recommend the book to anyone who wants to supercharge their social media growth.

5. Daily Visual: US Covid Chart

Source: Axios

6. Tip of the Day: Minimalism

Many of us buy things we don’t need, with money we don’t have, to impress people we don’t like. But there’s another group of people who prefer to do the opposite and live a minimalistic lifestyle. On its surface, minimalism is about owning less stuff. Minimalists reject the idea that we need to find happiness through possessions. Minimalism offers a life with less stress, less distraction, more freedom, and more time. All things that people today are desperately searching for more than ever.

Advertisers continue to tell us that our next purchase will bring us satisfaction and people continue to believe it. Minimalists have tried finding happiness through material possessions… and have been left unfulfilled. As a result, they are beginning to seek happiness and fulfillment in other places: relationships, social causes, and significance. Give it a try, you won't regret it.

7. Memes of the Day