HAPPY TUESDAY TO THE STREET
Greg Abel is opening the wallet. Berkshire Hathaway (BRK.B) agreed to buy $10B of Alphabet (GOOGL) stock in a private placement at a 6% discount, just one day after announcing an $8.5B deal for Taylor Morrison (TMHC). Buffett spent years sitting on a $380B cash pile. Abel found the keys to the war chest.
🟩 | US stocks ticked higher again today, enough for the S&P 500 to notch its first-ever close above 7,600, as both tech and oil continued to trend higher.
📉 | One Notable Decliner: Shake Shack (SHAK) tumbled after cutting its full-year earnings outlook and Q2 revenue guidance.
— Brooks & Cas
MARKET SNAPSHOT
S&P 500 Heatmap. Credit: Unusual Whales
WHO WILL ADVANCE IN TODAY’S LA MAYORAL PRIMARY?
Reality TV is having a crossover episode with reality.
Spencer Pratt, one-time villain on The Hills, is in a 16-way scrum for LA mayor against incumbent Karen Bass.
Kalshi traders think both he and Bass cruise past today’s primary, leaving a former MTV antagonist one runoff away from running America's second-largest city.
Market Movers
HPE, COHERENT, CREDO
📈 | Hewlett Packard Enterprise (HPE) jumped after current-quarter guidance topped estimates on AI server demand.
📈 | Coherent (COHR) surged as photonics names rallied on HPE's AI server outlook.
📉 | Credo Technology (CRDO) slipped despite topping Q4 estimates on AI cable demand.
📈 | STMicroelectronics (STM) climbed after raising its 2026 data center revenue ambition to roughly $1B.
📈 | Victoria's Secret (VSCO) rallied after raising full-year sales guidance.
Tomorrow's Trade Idea, Today
INTU THIN AIR
Stock Spotlight
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The Sell Signal
Goldman Sachs has turned bearish on Intuit, downgrading the stock to Sell and slashing its price target to $276.
Analyst Gabriela Borges sees a wave of AI tax prep startups carving into TurboTax's franchise, with shares likely rangebound for the next several quarters.
$0.12 Per Return
Borges estimates AI systems can process a standard individual return for about $0.12, against TurboTax's blended $162 per return. That math doesn't favor the incumbent.
Goldman flagged Prime Meridian, Perplexity Tax, and Chime Tax as the new generation moving beyond viral marketing into mature products and distribution.
The firm projects TurboTax revenue could run 18% below fiscal 2025 levels by 2030 if 20% of US filers shift to fully AI-based filing. Goldman's fiscal 2028 EPS estimate sits 13% below Street consensus.
Filing Cabinet
Intuit has weathered technology shifts for two decades, and its new Anthropic partnership plus a 17% workforce reduction could cushion the blow.
But Goldman trimmed its multiple to 15x earnings, and shares are deep in the red year-to-date. This audit, Goldman would argue, has only just begun.
Do you own any shares of Intuit (INTU)?
OVERHEARD ON THE STREET
🏛️ | President Trump signed an executive order asking AI firms to voluntarily give the government early access to frontier models up to 30 days before public release.
🕵️ | Trump also tapped FHFA director Bill Pulte to serve as acting director of national intelligence, replacing Tulsi Gabbard.
📉 | Exchange stocks including CME Group (CME) and Cboe Global Markets (CBOE) tumbled after the CFTC approved perpetual bitcoin futures for Kalshi.
🚛 | UAW workers walked off the line at Dauch Corp (DCH), threatening axle supply for General Motors' (GM) bestselling pickups.
💻 | Microsoft (MSFT) unveiled MAI-Code-1-Flash and MAI-Thinking-1, its first proprietary models built to reduce reliance on OpenAI and Anthropic.
MONDAY’S POLL RESULTS
Do you own any shares of International Business Machines (IBM)?
▇▇▇▇▇▇ 🐂 Yup, I’m holding
▇▇▇▇▇▇ 🐻 Nope, not interested
▇▇▇▇▇▇ 👀 No, but I’m interested
And, in response, you said:
🐂 Yup, I’m holding — “IBM holds more blockchain patents than anyone else-Intel being a distant second.”
🐻 Nope, not interested — “IBM may be showing some old man strength, but I smell hype.”
👀 No, but I’m interested — “Since I didn't purchase it in 1979, I'll just take HP.”
