Valuing tech companies is more of an art than a science. It is possible to understand why Nvidia, valued at £1.9 trillion, has been the star performer in New York this year.
The tech firm has an iron grip on developing artificial intelligence (AI) semi-conductors.
It is harder to make sense of first day trading in Trump Media & Technology, DJT, the Donald’s social media answer to Twitter.
In volatile trading, the stock climbed at one point to $79.38 a share, placing a value of more than £7billion on the firm and putting the Republican presidential candidate’s stake at nearly £5billion.
The timing is useful for Trump as he is scrambling to pay legal penalties after a civil trial in Manhattan, over alleged inflation of the value of his New York property empire, went against him.
Good timing: Donald Trump’s social media firms soared on the first day of trading in New York yesterday
It often takes tech companies many years to fulfil their potential.
It was 13 years before Jeff Bezos’s Amazon made its first profit as a listed firm. Investors rightly kept the faith because Bezos built a retail, marketing, logistics and cloud computing group beyond compare.
So far Trump’s Truth Social looks a little rackety. Some 8.9m accounts have been created since the platform was launched in 2021.
Yet it is light on income, racking up just $3.3million over the last nine months having lost $50million (£39.1million) in the last full financial year.
The success of DJT is based on a large cohort of Trumpers willing to trust their money to the great orange-faced phenomenon.
In a world where bitcoin has been driven into the stratosphere, in spite of huge fraud at sites such as Sam Bankman-Fried’s FTX, anything is possible.
Even so the rocketing share price of DJT is nothing short of weird.
Joint enterprise
Archie Norman has done wonders in restoring confidence in M&S.
The biggest deal on his watch, the £750million joint venture with online shopping pioneer Ocado, has been a disappointment.
In spite of the digital food presence it gave M&S during the pandemic and the devotion of prosperous middle Britain to both brands, M&S has struggled to make headway with the most innovative and higher value items in the Ocado basket.
Finally, there are signs that is changing. Investors in Ocado and M&S might see value from the deal restored.
The decision by M&S to parachute Hannah Gibson into the joint venture as chief executive is paying off.
Market research group Kantar found that Ocado was the fastest growing UK retail operation in the last three months with sales 9.5 per cent higher than a year ago.
The decision to lower prices and engage in promotions finally appears to be doing the trick with the number of customers growing to more than one million and income up nearly 11 per cent to £645million.
Once online shoppers transfer to Ocado-M&S there is little churn. Ocado and M&S’s main food rival Waitrose had a tricky time of it when grocery prices were surging.
Food costs are now moderating and rose by just 4.5 per cent in the last month. The higher cost of the shopping basket was caused by the UK’s sweet tooth with chocolate confectionary pushing up the cost of living amid soaring cocoa prices on global markets.
Sweet treats are offset by lower prices for butter and milk and toilet rolls.
Private equity-owned Asda, controlled by the Issa brothers, struggles. Morrisons, under the leadership of Rami Baitieh, with an intense focus on customer experience, is turning things around.
It goes without saying that Tesco has become ever stronger with a 27.3 per cent market share. Wow.
Fightback
A short thought from takeover land.
Amid other excitements, Currys and Direct Line have demonstrated in recent days that UK boards are not obliged to lay down their arms and beg for mercy as the first grapeshot from bidders and activists rains upon their head.
Determined, old-fashioned resistance is possible.
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