Whitney Tilson’s email to investors discussing Scott Galloway’s predictions for 2021.
Q3 2020 hedge fund letters, conferences and more
Galloway's predictions for 2021
I'm a huge fan of NYU marketing professor, bestselling author, blogger, and entrepreneur Scott Galloway.
I really enjoyed his new book, Post Corona: From Crisis to Opportunity, and this recent 73-minute video he posted in which he reviewed the 14 predictions he made last year (11 of which proved correct), and made new comments and predictions for 2021. Here are the ones that caught my eye (most of which I agree with):
- Apple (AAPL) acquires Peloton (PTON) and reaches a $3 trillion market cap, driven by continuing to shift more of its revenues to a "rundle" (recurring revenue bundle).
- Disney (DIS) does the same and sees its stock rise 30%.
- Facebook (FB) will be forced to spin off WhatsApp and Instagram, which will unlock great value for shareholders – though CEO Mark Zuckerberg, "a sociopath," will fight it to the end.
- Amazon (AMZN) CEO Jeff Bezos will be more clever and preempt regulators by spinning off Amazon Web Services. Both Amazon and Walmart (WMT) will make big inroads into the bloated and dysfunctional U.S. healthcare system.
- Commercial real estate, movie theaters, and gyms are in big trouble.
- Only young people will return to offices in large numbers – but cities will continue to attract talented people and drive two-thirds of our economic growth (though it might be Miami and St. Louis, not New York and San Francisco). Young people should still "get credentialed and move to a city."
- Airbnb (ABNB), "the strongest brand in the history of hospitality," will hit $200 per share and be worth more than the top five hotel chains combined.
- Shares of RH (RH) and Sonos (SONO) will both roughly double to $1,000 and $40, respectively.
- Realizing its market cap is inflated, Zoom (ZM) will "pull an AOL" and merge with a bigger company, which will turn into one of the worst deals in history.
- There will be an explosion in ed-tech and online learning, while traditional higher education struggles, as "cash cow" international students continue to stay away (for more on this, see Galloway's July blog post, USS University).
- Stock trading app Robinhood is a "menace" and should be reined in.
- Bitcoin hits $50,000. "I don't fully understand it," but "as a company and a brand," it's going higher.
- AT&T (T) hits $40 per share, driven by the success of HBO Max and divesting HBO and/or CNN (or putting it behind a paywall).
- When people are starving in the wealthiest country in the world, capitalism is collapsing on itself. But "I am hopeful!"
If you don't have time to watch the video, here's a related blog post: 2021 Predictions & Person of the Year.
