Sabre Arc Capital - December 2023

2023 Year End Update - $876,397

Special thanks to all who have subscribed! I hope everyone enjoyed their Holiday and is having a prosperous 2024.

Sabre Arc Capital ended the year at $876,397, another record closing, and only $123,603 away from hitting $1 million. As you can see below, the fund started in 2016 with $16,500 in deposits. I look at the table below from time to time to see how far we have come. 2023 was surprisingly refreshing after the beating we took in 2022.

We started 2022 with $560,711.06, which seemed like a few years until we hit $1 million. However, after ending the year at $876,397, I am convinced we can hit the elusive $1 million target in 2024.

Dividends & Interest

The fund received $4,759 in dividends & Interest for 2023. I live my life by two simple rules:

Never Bunt with Two Strikes & Always Reinvest your Dividends

Securities Bought & Sold

Our fund purchased $8,000 in three-month CDs & another $5,000 in Walt Disney Stock. Our Disney position is currently down ($18,500) or 15% as we try to lower our cost basis and continue to allocate capital to the position. The beauty of Sabre Arc is our ability to remain long-term focused.

Holdings

As we purchase more Disney, our top three holdings will continue to hold significant weight in the portfolio, and I hope we will never have to sell these core holdings.

Our north star is to have Sabre Arc become a $10 million fund with this heat map reflecting bright green!

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Earnings

Lululemon

• Sales rose to $2.2 billion, up about 19% from $1.86 billion a year earlier.

• CEO Calvin McDonald said Black Friday was the “single biggest day” in the company’s history.

• Q4 2023 margins fell (-90 bps) to (-110 bps versus earlier expectation of rising 10 bps to 20 bps.

Costco

• Total revenue rose to $57.8 billion, in line with Wall Street’s expectations. Same-store sales rose 3.8%, the same as in the previous quarter.

• Costco declared a special dividend of $15 per share, representing an aggregate of $6.7 billion paid to shareholders. ( I purchased a Costco Pizza with mine)

• Costco CFO Richard Galanti noted that Costco doesn't feel pressure to raise its membership fee just yet. "While we've gone a little longer than the average increase, we feel we certainly have driven more value to the membership," he said. "At this juncture, we feel pretty good about what we're doing."

Darden Restaurants

• Sales rose 9.7% from the year-ago period, which the company said was driven by the inclusion of Ruth’s Chris Steak House locations and a same-restaurant sales increase of 2.8%.

• Olive Garden same-restaurant sales were up 4.1%, while LongHorn Steakhouse saw a 4.9% jump for the quarter. Fine dining lagged, as sales fell 1.7% for the quarter.

• “The consumer appears to be resilient but more selective.”

Nike

• Revenue of $13.39 billion vs. $13.43 billion expected.

• The Company cut its revenue outlook for the year amid concerns that consumers worldwide are becoming more cautious with their spending.

• Nike plans to shave up to $2 billion in costs over the next three years through streamlining the organization and shedding employees, among other moves.

• “In this competitive environment, we need to accelerate our pace of innovation, elevate our marketplace experiences, maximize the impact of our storytelling, and increase our speed and responsiveness,” Friend (CFO) said on a conference call.