Pandora: 2 Reasons Why We’re Now Bullish (But Still Dislike The Company)

Hedgeye Internet & Media analyst Hesham Shabaan recommended shorting Pandora Media (P) from December 2014 until earlier this year. Recently, he’s flipped to the long side. For now. Shabaan explains why in this excerpt from The Macro Show yesterday.


Subscribe to The Macro Show today for access to this and all other episodes. 


Subscribe to Hedgeye on YouTube for all of our free video content.

So Much For The Ackman Pop ... Next Stop For Chipotle? $250

Takeaway: The Chipotle shareholder carnage continues as investors fade disclosure of Bill Ackman's 9.9% stake.

So Much For The Ackman Pop ... Next Stop For Chipotle? $250 - chipotle ackman 

Hours after Hedgeye Restaurants analyst Howard Penney hosted his Chipotle (CMG) short call on September 6th, Bill Ackman's Pershing Square Capital disclosed a 9.9% stake in Chipotle. The stock jumped on the news. 


But then, as it often does, reality set in... Chipotle's shares are down -9% from the peak of the Ackman hype.


Just as Penney predicted hours after the news...


And to be clear, he's reiterating the call today.


hungry for more?


For a good overview of Penney's short call on the company see the CNN Money story, "Why Chipotle could crash another 50%." To read Penney and analyst Shayne Laidlaw's response to Ackman's Chipotle stake after it was disclosed read, "Pershing Has Stepped In Front of a Ticking Time Bomb."


Finally, below is short video in which Penney responds to an institutional client's question about the "smoking gun" that will ultimately take down Chipotle.



Cartoon of the Day: Hawkish or Dovish?

Cartoon of the Day: Hawkish or Dovish? - Fed hawkish dovish cartoon 09.20.2016

Incessant Fed flip-flopping from hawkish to dovish (6x in 8 months!?) is simply insane. What will they do at Wednesday's FOMC meeting? Tell us what you think by casting your vote in our Poll of the Day here.

Hedgeye Statistics

The total percentage of successful long and short trading signals since the inception of Real-Time Alerts in August of 2008.

  • LONG SIGNALS 80.52%
  • SHORT SIGNALS 78.67%

Best Idea Long: Why Expedia Holds All The Cards

Best Idea Long: Why Expedia Holds All The Cards - HETV macroshow thumb expedia 9.20.2016

In this excerpt from The Macro Show, Hedgeye Internet & Media analyst Hesham Shaaban lays out our Best Idea Long call on Expedia and why the company’s HomeAway acquisition is a “considerable opportunity” relative to Wall Street’s expectations.

Did The Buyback Boom Just Go Bust?

Takeaway: After hitting a post-recession high, S&P 500 company share buybacks fell -6.8% y-o-y in the second quarter.

Did The Buyback Boom Just Go Bust? - bull1

is the tide turning?


Consider this. After hitting a post-recession high in 2Q16, FactSet reports today that S&P 500 buyback activity tumbled -6.8% year-over-year in 2Q16. 


Here's the key excerpt and chart from the FactSet data:


"Companies in the S&P 500 spent $125.1 billion on share buybacks during the second quarter, which marked the smallest quarterly total since Q3 2013. This comes after a first quarter that saw buybacks for the index hit a new post-recession high. Aggregate buybacks in Q2 represented a 6.8% decline from the year-ago quarter, which was the largest year-over-year decrease since Q1 2015. This Q2 decline came during a quarter that saw the S&P 500 index hit record-high price levels. On a trailing twelve-month basis, shareholder buybacks amounted to $592.9 billion at the end of the second quarter. This was a 6.8% increase from the same time period a year ago. The TTM buyback total at the end of Q2 marked the fourth largest amount going back to the start of 2005, despite this quarter’s decline."


Did The Buyback Boom Just Go Bust? - buyback 9 20


This dour question mark is a far cry from the headlines we saw just two months ago when the buyback boom was cited as justification for why the S&P 500 was hitting all-time highs. Indeed, as the Wall Street Journal wrote, "There's No Need To Fear the Buyback-Boosted Stock Market." 


We advised otherwise, here(Note: The S&P 500 is down -0.9% since then.)


***To understand why we think buybacks, corporate profits, consumer confidence, the labor market etc, etc, etc, are all past peak and U.S. growth continues to slow, watch this 6-second animated clip Hedgeye CEO Keith McCullough in "An Animated History of U.S. #GrowthSlowing" below.


The BOJ's Stench of Desperation

Takeaway: The BOJ is monetizing over half of annual JGB issuance but has still failed to energize economic growth.

Editor's NoteBelow is an excerpt from a research note written by Hedgeye Senior Macro analyst Darius Dale. To access our institutional research email

The BOJ's Stench of Desperation - Nikkei  BOJ cartoon 09.13.2016 large

That Japan's failure to launch occurring at a time when the Bank of Japan (BoJ) is expanding its balance sheet at a near +25% annual clip speaks volumes about the inefficacy of the BoJ’s existing monetary easing platform.


And while market participants have yet to defend critical ratios with respect to the size of the BoJ’s balance sheet or the pace of its accumulation of JGBs, the seemingly egregious nature of both is worth flagging.



  • The BoJ’s balance sheet is nearly three times the size of the next closest G4 counterpart when adjusted for the size of the respective economies.
  • When assessed as a ratio to total nonfinancial sector credit (a good proxy to evaluate where LSAP programs may face frictional resistance), the BoJ’s balance sheet is twice the size of the next closest G4 counterpart.
  • Prior to the start of Abenomics, the BoJ was a fairly distant third with respect to JGB ownership at 12% of the float. It’s now far and away the #1 holder at 33.9% of the total. Monetizing over half of annual JGB issuance has a tendency to do that for you. 


The BOJ's Stench of Desperation - central bank 9 20


All told, the purpose of this note isn’t to speculate on what the BoJ will or won’t do tomorrow. For all I care, Kuroda could tightrope across the towers of the Tokyo Metropolitan Government Building wearing nothing but whitey tightys and I would be largely unfazed.


While there’s no doubt the BoJ has the potential to shock global bond markets for a TRADE, there’s also no doubt that nothing they do tomorrow or in the not-too-distant future will outweigh economic gravity in the pricing of interest rates over the long term. How they plan to achieve the aggressive growth and inflation targets as mandated by Abenomics remains well beyond our purview – and likely theirs too (hence the stench of desperation and policy fatigue).


See the forest, not the trees. The central planning #BeliefSystem continues to break down right before your very eyes.

the macro show

what smart investors watch to win

Hosted by Hedgeye CEO Keith McCullough at 9:00am ET, this special online broadcast offers smart investors and traders of all stripes the sharpest insights and clearest market analysis available on Wall Street.