AI and why the working week won't reduceThis analysis is provided by Eden Bradfeld at BlackBull Research—sign up for their Substack to receive the latest market insights straight to your inbox.
Tinder, Bumble and so on were once feted as the “new thing”. Here’s how Bumble is doing now.
That’s — not great! That’s pretty bad! The world moved on from dating apps, by and large — dating app consumption is actually down as Gen Z prefers to meet in person. Textile mills of the 21st century. So-long, and thanks for the fish.
There’s two things I’m sure of here:
People will not work less. This has been proven throughout history.
Many currently high-margin, stable businesses will not be are stable or as high-margin.
One of the great economic fallacies is that of optimism — specifically, that the working week will reduce. Here is Keynes, in 1930 —
We may be able to perform all the operations of agriculture, mining, and manufacture with a quarter of the human effort to which we have been accustomed.
Keynes was writing in the wake the Great Depression — it’s fairly remarkable foresight, as the US embarked on several golden decades — $1.00 invested in the S&P in 1929, at the peak of economic gloom, would be worth around $7,622 — you’d have an inflation adjusted return of 41,690.91%. Ne bad, as they say in Scots.
But here’s where he’s wrong — he had hoped for a quarter of human effort — predicting a 15 hour workweek. That hasn’t happened. If anything, the work culture in America and many western countries has become something of a religion — work hard and glorify it. That work has transmuted for many of us from factory jobs and field labour to office jobs and such, but it remains work — we are there to create a surplus of capital, as Marx wrote long ago.
History doesn’t rhyme but it repeats — similar suggestions of the end of work have been made with the advent of AI. Now, it is likely that AI will be able to replace many jobs — especially those that were traditionally protected (you probably don’t need a lawyer to draft up a basic contract, etc…). If we look at the various other revolutions, though, especially the industrial, what we find is that work ends up being something else.
What might it be? Will we have offices filled with people slaving away to Chat GPT, typing in prompts at their terminals? Essentially, will we become part cyborg, delivering commands to our AI counterparts?
It’s interesting to think about what this will do economically. The Industrial Revolution saw vast progress and economies expand rapidly — areas like the North of England, which were traditionally poor, saw riches prosper, while the old class of aristocrats found themselves taxed by both lack of economic progress and real taxes,³ which saw the economic picture turn — at least for a while. And yet — even those economic realities change — the once-rich textile barons of the Industrial Age, with factories in France and England, saw their businesses fall into disrepair as the world moved on. Automated looms, once cutting-edge, found themselves surpassed.
Here’s another example, Chegg Inc, which makes study tools. Of course, Chat GPT has surpassed that and tends to do a better job. Just ask your teens.
That’s also — not very good!
Let me now think about industries that we all think are safe but may be disrupted (don’t you hate that word?) — lawyers, accountants, coders. Uh oh. Whatever happened to “just learn to code, bro”. What happens to the “big four” accounting firms when AI gets good enough to perform most of the functions?
Let’s invert — what are companies and industries that (should) remain impervious:
Luxury — Hermes specialises in the handmade, and that’s part of the brand. The human desire for scarcity and to signal status has not changed in all of history.
Toll-booth businesses — think exchanges (NZX, CBOE, LSE), literal toll booths (Channel Infrastructure), payment operators (Visa, Stripe, etc).
Companies which command mindshare — CostCo, Amazon, etc.
Booze. Duh. AI doesn’t drink booze; humans do.
Bumble
The Case For BumbleBumble has a yearly gross profit of 693M. Last year they repurchased 310M worth of stock.
Bumble at 5.64/share means it's entire market cap would be 610M or 80M less than one year's worth of profit. I don't understand how anyone could sell BMBL this low.
So while I'm not in love with BMBL's revenue growth, it's pretty clear this stock is significantly undervalued. 5.35 would be my buy target on support.
I'm interested to hear anyone else's take.
Good luck!
BMBL Bumble Options Ahead of EarningsAnalyzing the options chain and the chart patterns of BMBL Bumble prior to the earnings report this week,
I would consider purchasing the 8usd strike price Calls with
an expiration date of 2025-4-17,
for a premium of approximately $1.52.
If these options prove to be profitable prior to the earnings release, I would sell at least half of them.
Bumble | BMBL | Long at $8.34Arguably, Bumble NASDAQ:BMBL , Match NASDAQ:MTCH , and Grindr NYSE:GRND have an enormous amount of *highly* valuable data on its past and current users. Like any industry, it often simply takes time for this recognition by market makers to occur before price aligns with the "true" future value. If you are an AGI company looking to enhance user companionship with machines and AI bots, these companies hold the keys.
NASDAQ:BMBL has low debt, paying users are still growing (caution if recession begins), and revenue is rising. Personally, the value is in the company's data.
From a technical analysis perspective, my historical simple moving average lines are working their way toward the price. Often, this means a rise in price as the lines flatten and then inevitably rise with the trend reversal. However, I would not be surprised if there were some shakeouts in the near-term if the price suddenly dropped near $5 post-earnings, etc. Regardless, it will personally likely be an opportunity to gather more shares. Thus, at $8.34, NASDAQ:BMBL is in a personal buy-zone.
Target #1 = $12.00
Target #2 = $15.00
Target #3 = $22.00
Bumble Posing Positive Returns Despite Current Market Trend Bumble shows weak development in a falling trend channel in the medium long term. Falling trends indicate that the company experiences negative development and falling buy interest among investors.
An inverse head and shoulders formation, however, is under development. A decisive break of the resistance at $15.15, ideally with an increase in volume, signals a further rise. The stock is testing resistance at dollar 15.30. This could give a negative reaction, but an upward breakthrough of dollar $15.30 means a positive signal.
Bumble | BMBL | Short to Gap FillBumble ( NASDAQ:BMBL ) jumped well over +40% on an earnings miss... While it may have "new news" life in the coming days as analysts slash their targets and headlines declare "stock can surge nearly 200%" (source: CNBC)... it is likely to fill the gap or partially fill the gap below ($17.13 to $29.28) before truly making a *long-term* move higher. If the rally continues this week, though, it may test $25.50 or could go as high as $28 (50 EMA) or even $29.50 (near the resistance of the falling wedge). Regardless, the March 2022 Fed meeting and OpEx are next week. I can see the rally news fading rather quickly and this correcting to fill or partially fill the gap in March or perhaps early April.
Q4 2021 Earnings Details: (source: Google Financials)
Paying users = 2.98 million (Estimate of 3 million)
EPS = $0.02 (Expected = $0.10, Surprise = -76.92%)
Revenue = $208.22M (Expected= $209.18M, Surprise -0.46%)
While Bumble and Match likely have great futures and long-term growth in the dating world, it's possible the Bumble post-earnings rally is only temporary.
BUMBLE IPO -- $10 MOVE; CHEAP DATE!
Time to watch another IPO NASDAQ:BMBL
Usually the initial daily price range of anything that has zero history, will give strong support and resistance levels the 1st time they are met, with profits zones back to the opening daily range.
That said, as the chart suggests, I'm looking at $88 as a topping out point AND OR $61 as a bottoming point, both giving the potential for a $10 (10%+) play.
*There is a temporary price level that could be used for support and or resistance going either direction. Certainly a point to watch, if its needed.
*This is my trade idea and not considered as advice*