Sabre Arc Capital - February 2024

Fund Total: $989,393.52

Sabre Arc Capital ended February at $989,393.52; I hope by this time next month, I will be reporting that Sabre Arc is a million-dollar firm!

Securities Purchased

We continue to build our position in The Walt Disney Company and are further encouraged by changes the management team is making, albeit from activist pressure. Our fund receives about $10k in capital commitments per month, and I have the pleasure of allocating the capital. I often find it challenging to balance allocating to the war chest (cash) and going all in with the security in which we are building a position. I have personally made the mistake of Sabre Arc not having liquidity during significant downturns in the market; as of now, we currently have around $50K in cash and cash equivalent securities.

Dividends & Interest

Dividends for the month totaled $351.29, and we received interest of $116.19. The total for the year in dividends & interest is $1,299.26, a promising start to the year.

It is a beautiful sight as Disney turns green; however, we still have much work to do.

And now it's time for some earnings!

February 2024 Earnings

Amazon

• Revenue jumped 14% to $170 billion in the fourth quarter - “This Q4 was a record-breaking Holiday shopping season and closed out a robust 2023 for Amazon.”

• Advertising revenue growth is also picking up, rising 27% Y/Y to $14.7 billion and making Amazon a not-too-distant number three in that market after Meta and Google. 

• Operating cash flow increased 82% to $84.9 billion for the trailing twelve months, compared with $46.8 billion for the trailing twelve months ended December 31, 2022.

Meta

• Revenue jumped 25% in the quarter from $32.2 billion a year earlier, the fastest rate of growth for any period since mid-2021.

• Net income more than tripled to $14 billion.

• Meta said it will pay investors a dividend of 50 cents a share on March 26. That comes after cash and equivalents swelled to $65.4 billion at the end of 2023 from $40.7 billion a year earlier. The company also announced a $50 billion share buyback.

Alibaba

• Revenue edged up 5% in its fiscal third quarter to the equivalent of $36.67 billion. Sales at Alibaba’s core digital retail and online commerce businesses, Taobao and Tmall, grew 2% per year to $18.18 billion.

• Net income attributable to ordinary shareholders slumped 69% to $2.03 billion.

• The company approved a $25 billion increase to its share-repurchase program through March 2027, meaning Alibaba has $35.3 billion available under its buyback program through the next three fiscal years.

  

Disney

• The company said it continues to see full-year free cash flow of about $8 billion.

• The company expects to reach profitability in its streaming business by the fourth quarter of the current fiscal year.

• Disney’s direct-to-consumer unit reported a $138 million operating loss in the quarter. Including the performance at ESPN+, losses for all its streaming businesses narrowed to $216 million, from $1.05 billion in the prior-year period.

• Disney said it is on pace to meet or exceed its goal of cutting costs by at least $7.5 billion by the end of fiscal 2024.

Lastly, my buddy, Chima, has a fun Nvidia write-up that is worth reading.