Walmart’s Semi-Secret Effort to Become Internet-Cool
The millennial “influencer” culture has become a staple of modern day society. The brands that tend to appeal to influencers are environmentally conscious, primarily online-based, and usually sell higher quality products. This description might seem at odds with Walmart’s targeted customer base – and in a general case it may be. However, Walmart also owns Allswell, an environmentally-friendly, quality, online mattress retailer. Walmart has been vigilant to keep its ties with Allswell as unnoticed as possible. We believe this makes sense from a business standpoint, since Allswell’s target customers aren’t the same as Walmart’s and could potentially be “scared off” by similarities between the two. One possible reason Walmart is entering this type of “millennial trend” space is that Amazon already has quite a share in it. The competition between these two retail giants is an ongoing battle and Walmart might see this space as a potential advantage or maybe even a necessity in light of this struggle.
https://www.wsj.com/articles/walmarts-semi-secret-effort-to-become-internet-cool-11564200661
U.S. Truck Driver Shortage Is On Course to Double in a Decade
The U.S. truck driver shortage is increasing. Automation (self-driving technologies) might end up being a much needed solution, but because it puts current human drivers’ jobs at risk it has been met with hostility. In the near term, the industry has been one of the most aggressive against adoption of new technologies because they realize implementation will not happen overnight and they need to be able to attract workers to bridge the gap in the meantime. Why has this shortage occurred? Other industries, like tech, are drawing younger workers and leaving more gaps in the workplaces of more vocational types of jobs. Historically low unemployment rates are certainly not helping either. Most agree, over time, the trucking industry will most likely turn to automation to remedy this dilemma. What’s missed many times is that the market naturally accommodates innovation and the resultant obsolescence. We’ve had much disruption the last ten years and if you reference the current unemployment rate – we’re at record lows. So while a deliberate and incremental approach is warranted, innovation shouldn’t be avoided just for the sake of avoiding innovation. When you do, that’s when the free market is stifled.
Cloud Computing is Here. Cloud Recycling is Next.
The cloud transformation is well underway, but according to many, it still is in the early innings. Google and Amazon have massive cloud platforms and numerous companies have emerged to service these and other cloud networks. Cloud prioritization improves efficiency and connectivity, making it a great long-term investment. However, another market opportunity has become relevant in this world of the cloud: cloud computing system recycling. This business can be expected to grow alongside the cloud business, and already has plenty of stock since cloud systems typically only have a life-span of about 3 years. However, it should be noted that this business is highly complicated and as a result many of these systems are being stockpiled to be dealt with at a later time. Companies and consumers are very adamant (and rightly so) about the proper reuse of their systems, many of which still contain valuable and in some cases confidential data. Thus, only certain parts can be potentially reused. Cloud recycling still is a budding, adapting business and will likely create a more structured recycling process that avoids putting data (or the customers behind it) at risk. This is one of a number of businesses that emerge with a trend, but are often mostly neglected – which shouldn’t be the case as value might be missed.
From Fitbits to Rokus, Hedge Funds Mine Data for Consumer Habits
What data is the most useful to companies? It depends on the industry, but for hedge funds analyzing for market trends, the five most frequently used types of data are: Web Scraping, Twitter Sentiment, Credit Card Data, and Employment Data. Data is integral to the function of our society. With the cloud transformation trend and internet of things (IOT), data applications will increase. Modern society could become a world in which data generated by every infinitesimal activity is recorded, analyzed, and applied. This could be a good thing for innovation, businesses, and for consumers in the overall economy. However, it also invites regulatory scrutiny and data privacy concerns which could be a stumbling block for “easy profits”.
Autonomous Trains Are Ready to Roll
The railroad industry is still a large industry whose success is directly linked to the health of the overall economy. After many years of stagnation, the railroad industry is undergoing a significant renaissance as innovative technology is being adopted to managing logistics, maintenance and the flow of goods – so called, “smart” or precision railroading. The next transformative step: automation. Railroad automation is probably the easiest transportation-based AI to implement because of its centralized nature, but also probably the least mentioned. However, it could drive efficiency and create a railroad industry that is much more tech-designed and “front-page” relevant. Furthermore, it could allow more accurate data regarding shipping, since automation is much more regular than human workers.
https://fortune.com/2019/07/29/autonomous-trains-challenges/
Important Disclosures:
Material presented herein is for informational purposes only and should not be considered a recommendation to buy or sell any specific security or employ any investment strategy. You should not assume that any discussion or information provided here serves as the receipt of, or as a substitute for, personalized investment advice from Validus or any other investment professional.
All opinions expressed constitute Validus’s judgment as of the date of this report and are subject to change without notice. Investing in the stock market is speculative and involves risk. Market conditions can vary widely over time.
Different types of investments and/or investment strategies involve varying levels of risk, including loss of principal, and there can be no assurance that any specific investment or investment strategy will be suitable or profitable for a client’s or prospective client’s portfolio.
Past performance does not guarantee future results. Performance results illustrated herein are past results, do not reflect the deduction of transaction, custodial charges or the deduction of investment management fees and are provided for informational purposes only.
An investor cannot invest directly in an index. Performance does not reflect the deduction of any fees, expenses or taxes. That would have the effect of reducing returns. Please note that comparison to a different index might have materially different results than those shown.
There is no guarantee that any historical trend illustrated above will be repeated in the future, and there is no way to predict precisely when such a trend might begin.
Index Definitions:
MSCI ACWI Index: is a free float‐adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The MSCI ACWI consists of 46 country indexes comprising 23 developed and 23 emerging market country indexes.
MSCI Emerging Markets Index: The MSCI Emerging Markets Index captures large and mid-cap representation across 24 Emerging Markets (EM) countries*. With 845 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country
S&P 500 Index: The index includes 500 leading companies and captures approximately 80% coverage of available market capitalization.
S&P CoreLogic Case-Shiller Home Price Indices: The S&P CoreLogic Case-Shiller Home Price Indices are the leading measures of U.S. residential real estate prices, tracking changes in the value of residential real estate both nationally as well as in 20 metropolitan regions. For a list of additional indices, please refer to the S&P CoreLogic Case-Shiller Home Price Index Methodology.