To The Moon

The Q1 2025 earnings season is here, and it’s a wild ride! Stocks are swinging like pendulums, with some companies cratering and others holding strong. Snap ( $Snap Inc(SNAP)$ ) and Starbucks ( $Starbucks(SBUX)$ ) are taking it on the chin, while Eli Lilly ( $Eli Lilly(LLY)$ ) might just be the diamond in the rough. From Spotify’s slump to SoFi’s surprise, let’s unpack the madness, share my expectations for the season, and pick the winners and losers. Buckle up—this one’s packed with insights!

The Earnings Landscape: Feast or Famine?

Q1 2025 is a classic mixed bag. Tech and consumer discretionary stocks are stumbling, while healthcare and staples are standing tall. The S&P 500’s earnings growth is pegged at 7.2%, but the “Magnificent 7” tech giants are dragging their feet, leaving the other 493 companies to carry the torch. It’s a tale of two markets—volatility’s high, and investors are on edge.

Here’s the rundown of key players so far:

• Snap (SNAP): Dropped 13% after a Q1 beat but no Q2 guidance. Macro headwinds are the excuse, and investors aren’t buying it.

• Starbucks (SBUX): Sales flopped, same-store traffic’s down 4%, and their turnaround’s sputtering. Oof.

• Spotify ( $Spotify Technology S.A.(SPOT)$ ): Slid 8% despite a solid Q1. Cautious vibes are drowning out the good news.

• SoFi ( $SoFi Technologies Inc.(SOFI)$ ): Raised guidance after crushing estimates. Fintech’s fighting back!

• PayPal (PYPL): Beat profit goals but stayed cautious amid U.S. trade uncertainty. Steady, but uninspiring.

• Coca-Cola (KO): Topped estimates with price hikes and steady demand. Staples for the win.

Now, let’s dive into the headliners: SNAP, SBUX, and LLY.

SNAP: Crashing Without a Compass

Snap’s Q1 was a paradox. They posted $1.36 billion in revenue (beating $1.35 billion expected) and grew daily active users to 460 million (a slight edge over forecasts). Adjusted EBITDA hit $108.4 million, way above the $65.4 million analysts predicted. So why the 13% plunge? No Q2 guidance. They blamed “macro headwinds,” but that’s code for “we’re clueless.” Investors don’t like blind dates, and SNAP’s stock took a nosedive.

The user growth is a bright spot, but without a roadmap, it’s hard to trust them. Are they hiding something, or just scared? Either way, I’m not touching this one until they show some backbone.

Pick: Bearish. Uncertainty’s a dealbreaker.

SBUX: A Turnaround That’s Running on Decaf

Starbucks is brewing trouble. Q2 sales missed the mark, with same-store sales down 4% and traffic off 6%. EPS came in at 69 cents (just above 67 cents expected), but that’s cold comfort. Their “Back to Starbucks” plan—streamlining menus and cutting costs—sounds good on paper, but it’s not clicking yet. Consumer wallets are tight, and Starbucks isn’t the must-have it used to be.

Can they turn it around? Maybe, but it’s a slog. The brand’s got loyalists, but this dip feels more like a warning than a bargain. I’d wait for signs of life before jumping in.

Pick: Bearish, with a side of caution. Too much risk, not enough reward.

LLY: Healthcare’s Hidden Gem?

Eli Lilly (LLY) is the wildcard. Healthcare’s been a rockstar sector, up 3.8% this month while tech’s down 4.6%. LLY’s due to report on May 3, and expectations are high: EPS of $2.46 on $8.9 billion in revenue. Their diabetes and obesity drugs are blockbuster material, and the stock’s already up 12% YTD. If they deliver a beat, watch out—this could be a breakout moment.

Healthcare’s defensive edge makes LLY a safe harbor in this storm. I’m betting they’ll shine while others stumble.

Pick: Bullish. Strong fundamentals, stronger sector.

Q1 Expectations: Where’s the Market Headed?

This earnings season’s a split-screen thriller. Tech and discretionary names like SNAP and SBUX are getting crushed—macro fears and weak guidance are kryptonite. Meanwhile, healthcare (LLY) and staples (KO) are flexing resilience, and fintech (SOFI) is carving a niche. My take? The S&P 500’s 7.2% growth masks a deeper divide: stick with sectors that can weather the chaos.

Here’s a quick sector snapshot:

My Top Picks: Bullish and Bearish Bets

• Bullish on LLY: Healthcare’s hot, and LLY’s pipeline is hotter. A beat could send it soaring.

• Bullish on SOFI: Fintech’s got momentum—raised guidance is a green flag.

• Bearish on SNAP: No guidance, no guts, no glory. Pass.

• Bearish on SBUX: Turnaround’s too shaky, and consumers are tapped out.

Want a pro move? Go long LLY, short SNAP. It’s a hedge with upside.

Visualizing the Divide:

This graph shows the haves and have-nots—green for gains, red for pain.

Your Play: Risk It or Play It Safe?

Q1 2025 is a battlefield. SNAP and SBUX are licking their wounds, while LLY and SOFI offer hope. Are you rolling the dice on a Starbucks rebound, riding LLY’s wave, or sitting this one out? Share your picks below—let’s crack this earnings puzzle together!

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📝 Disclaimer: This post is for informational purposes only and does not constitute financial advice. Always conduct your own research before making investment decisions.

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