Silver banana goes to…

In this issue of the peel:

• 😴 Markets hit the snooze button before a big week of tech earnings.

• 🚚 DoorDash is trying to shmooze its way into a greater food delivery market share with its bid for Deliveroo.

• 💸Wealthy Americans upped their spending despite economic fears, while the lower-income consumers are cutting back.

Market Snapshot

Banana Bits

• Palantir has been the top-performing stock so far in 2025.

• First quarter results from credit card lenders show a tale of two tapes, with wealthy Americans increasing spending while low-income consumers cut back.

• Scott Bessenet says it’s up to China to get a deal done, not the US.

• The market has a busy week ahead, between big tech earnings and key economic data.

• Spotify paid over $100 million to podcasters. Check out which ones signed the biggest deals.

• DoorDash is willing to pay up to $3.6 billion to take over Deliveroo and solidify its position as the top food platform.

The Daily Poll

Previous Poll:

Home sales tanked again—what’s your housing market take?

Can’t afford anyway: 37.8% // Waiting for the crash: 37.8% // Buying = cardio: 13.4% // Renting forever: 11.0%

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Macro Monkey Says

Economic Health Check

Ok, so last week we reported on credit card spending continuing to rise. While that is true, more data is piling in, and digging in the weeds is showing a diverging economy. While half of consumers are still ballin’ out, the other half are in hardcore budget mode.  

According to a new CNBC report, high-income consumers, typically those making $150,000 and up, are still splurging on vacations, luxury goods, and fancy dining. Meanwhile, everyone else is cutting back, coupon-hunting, or at least thinking twice before swiping that card.

Brands are feeling the split, too. Stores like Nordstrom and LVMH (think Louis Vuitton, Dior) are thriving because rich shoppers are living it up. Meanwhile, Target and Walmart are shifting strategies to appeal more to value-driven customers who are tightening their wallets.

Basically: it's a great time to be selling $3,000 handbags, and a tough time to be selling... pretty much everything else.

Why the divide? A few reasons. Despite the last few months, stock portfolios are up in the long-run (wealthy consumers tend to have more invested). Incomes at the top are rising faster. High-interest rates and inflation are hurting middle-class and lower-income households way more initially. 

The good news, as a college student or young 20-something, is that not much has likely changed for you. You’re probably already living that scaled-back, barebones lifestyle.
You’ve probably been focused on paying off student loans, affording rent, and maybe grabbing a few happy hour deals. 

The Takeaway?

The initial reports for Q1 highlight a tale of two consumers. 

Synchrony, which provides store cards for retail brands including Lowe’s and T.J. Maxx, said spending fell 4% in the first three months of the year. That compares to a 6% spending jump at American Express and a similar rise at JPMorgan Chase, both of which cater to wealthier users with higher credit scores.

Career Corner

Question

I am applying for an Equity Research role (that I believe fits me well, despite focusing on IB). The position is 1 week old and has over 100 applicants; would I stand out if I wrote an interest statement as asked by LinkedIn?

Answer

I don’t have a strong view on these LinkedIn applications, but I assume marking as your top choice can’t hurt.

But also, importantly, you should be networking! That will likely have a bigger impact than whether or not you check this box. And strong interview prep with a strong stock pitch will go a long way! (Also, as an aside, you can’t trust the number of applications on LinkedIn; some submissions are completely unqualified, and some are bots.)

Head Mentor, WSO Academy

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What's Ripe

Wayfair (W) 6.1%

• Wayfair investors are crawling back to this stock after running for dear life a few weeks ago. As a retail company that sells furniture and has a high exposure to Asia, tariffs were the worst possible thing that could have happened. 

• However, with tensions seeming to be easing for now, people are realizing that Wayfair is a pretty decent company after all.

Snap Inc. (SNAP) 3.4%

• While tech investors played it safe for the most part and shed exposure prior to big tech earnings, SNAP investors wanted more. The stock traded up before earnings, even with conservative expectations from Wall Street Analysts. Perhaps investors feel they’re too conservative and are positioning themselves for the company to beat. 

What's Rotten

Instacart (CART) 4.8%

• Instacart just made a list of the top 10 stocks to buy according to billionaires. Well, it looks like nobody listened to those billionaires today, as the stock got hit. 

• The DoorDash acquisition strengthens its position in the grocery and food delivery space, which Instacart investors see as a negative. Instacart should probably start getting active in the M&A space soon!

Colgate-Palmolive (CL) 3.1%

• Colgate’s stock is still taking a hit from weak guidance in its earnings report last week. The revised outlook is due to anticipated tariff costs of approximately $200 million in 2025 and a decrease in consumer demand amid economic uncertainties. 

• The latest report that consumers are cutting back on everyday expenses surely didn’t help as well.

Thought Banana

DoorDash’s European Exploration 

Big moves are happening in the food delivery world: DoorDash just made a $3.6 billion offer to buy out Deliveroo, the UK-based delivery giant. Your late-night cravings might soon have even fewer borders to cross.

Deliveroo, which launched back in 2013, has been a go-to for food delivery across Europe and beyond. After years of intense competition (and questionable profit margins), Deliveroo finally posted its first full-year profit in 2024—and apparently, DoorDash took notice. 

Why is DoorDash doing this? In simple terms: world domination. They’re already strong in the U.S., Canada, Australia, and New Zealand, but buying Deliveroo would instantly plug them into huge markets like the UK, France, and Italy. 

Plus, with the food delivery sector heating up with competition (i.e., Uber Eats and Just Eat Takeaway), DoorDash knows it has to scale or risk getting left behind.

Deliveroo’s board is pretty into the idea too—they said they’d recommend the deal to shareholders if the terms stay sweet. DoorDash has until May 23 to make it official, or it’s back to the starting line.

Between inflation, tariffs, and everyone's ongoing love for ordering ramen at midnight, the delivery business is getting spicy. This deal could majorly shake up how your future takeout orders happen—even if you're just ordering a burrito between Zoom classes.

The Takeaway?

This proposed acquisition follows a trend of consolidation in the food delivery industry, highlighted by Prosus's recent €4.1 billion purchase of Just Eat Takeaway.com. 

If successful, the deal would position DoorDash as a formidable competitor in the European market, leveraging Deliveroo's established infrastructure and customer base. The move underscores DoorDash's ambition to become a global leader in the food delivery sector.

The Big Question: Is DoorDash buying Deliveroo about growth, or fear of Uber Eats eating their market in Europe?

Banana Brain Teaser

Previous

When Leo imported a certain item, he paid 7% import tax on the portion of the total value of the item in excess of $1,000. If the amount of the import tax that Leo paid was $87.50, what was the total value of the item?

Answer: $2,250

Today

Pipe A can fill a tank in 4 hours, and Pipe B can fill the same tank in 6 hours. If both pipes are opened together, but Pipe B is closed after 2 hours, how long will it take in total to fill the tank?

Send your guesses to [email protected]

How Would You Rate Today's Peel?

Happy Investing,
Chris, Vyom, Ankit & Patrick

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