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The 27-year-old American won her 87th World Cup race, surpassing Sweden’s Ingemar Stenmark for the most of all time

Among Alpine skiers, Mikaela Shiffrin now stands alone.

Shiffrin won a slalom race Saturday for the 87th World Cup victory of her career, surpassing the all-time record of 86 set by Sweden’s Ingemar Stenmark. She’s now won more races than any other man or woman in Alpine skiing history.

Shiffrin set the all-time mark in Are, Sweden—the site of her first-ever World Cup victory, also a slalom, on Dec. 20, 2012.

In a race sometimes decided by hundredths of a second, Shiffrin won Saturday by nearly a full second, finishing .92 ahead of Switzerland’s Wendy Holdener. Shiffrin then stood atop the podium, hand over heart, and sang as the national anthem played.

“Thank you to my whole team, the whole U.S. team,” she said. “You make it possible, so thank you.”

Shiffrin said she planned to celebrate with her older brother, Taylor, and his wife, who surprised Shiffrin by coming to Sweden.

Saturday’s win continued a spectacular run for the 27-year-old American, who was born in Vail, Colo., to ski-racing parents and has become perhaps the greatest Alpine ski racer of all time.

In January, Shiffrin won her 83rd World Cup race, superseding fellow American Lindsey Vonn to claim the all-time wins total for a female Alpine skier. At the time, Vonn said Shiffrin “will no doubt go far beyond 82…raising the bar for the next generation of American skiers.”

Shiffrin’s pace of victories is unequaled as she set the women’s and men’s wins records faster than the two previous record-holders.

Vonn was 33 years old when she won her 82nd race, and she retired a year later. Stenmark was 32 years old when he notched his 86th and final World Cup victory.

Shiffrin turns 28 years old on Monday.

“Shiffrin is such a great skier with a fantastic technique and really deserves to break my record,” Stenmark said in an email before she surpassed his mark, set in 1989. “I will be happy for her when she does.”

Stenmark added: “She will be the first to reach 100 World Cup victories.”

Shiffrin has excelled even outside her record run. She has three medals across three Olympic Games, and 14 medals at Alpine skiing’s world championships. The international ski federation (FIS) doesn’t count either of those events as World Cup races.

At the world championships, Shiffrin has won 14 medals in 17 starts. That means that each time she steps into the starting gate, she has an 82.4% chance of reaching the podium.

She entered the 2023 season after a productive stint of offseason training, but a realistic view. She knew it was highly unlikely she would repeat her 17-win performance from 2019, and was openly skeptical that she could win nine races to break Vonn’s record this season.

But Shiffrin has surpassed her own expectations, winning an eye-popping 13 World Cup races. She’ll finish the season at the World Cup Finals in Soldeu, Andorra, and plans to enter three races: Thursday’s super-G, followed by the slalom and giant slalom.

Shiffrin’s resurgence this season is all the more remarkable given her disastrous performance at the Beijing Olympics a year ago. A favorite to win multiple medals, Shiffrin won zero. In three of her six races she skidded off course and failed to finish. It was a shocking outcome for a skier who carves turns with the precision of a metronome.

But Shiffrin had an eventful few weeks after the Games that helped her move on. She and her mother, Eileen, had an hours-long lunch with tennis great Roger Federer and his wife at their Swiss home, which helped rejuvenate Shiffrin.

And in May, as she was headed off to a postseason vacation, she received a phone call from a fan that helped her put her Olympic experience in the past. The fan said he thought Shiffrin performed so poorly at the Games because they were her first after the 2020 death of her father. Shiffrin has also had productive sessions with a grief counselor.

Stenmark’s World Cup victories came in two disciplines: 46 in giant slalom, 40 in slalom. Shiffrin also excels in the slalom and giant slalom, but she is the rare skier who can win any style of race.

In 2018, she became the first skier to win World Cup races in all six individual disciplines. Overall in her career, she’s won 53 slaloms, 20 giant slaloms, five super-Gs, five parallels, three downhills and one Alpine combined.

Plus, CVC nets a slimmed-down tennis deal, Adidas suffers Yeezy fallout

Qatar’s designs on the Champions League will need another rethink. On Wednesday, Paris Saint-Germain were dumped out of European football’s elite competition at the hands of German juggernaut Bayern Munich.

PSG, which has been owned by a Qatari investment fund since 2011, had assembled the most expensive playing squad in football history for its campaign this year. The club’s wage bill surged to €728mn last season, according to Football Benchmark, thanks to the star-packed front line of Lionel Messi, Kylian Mbappe and Neymar. Yet big money in football only gets you so far.

Messi’s contract runs out this summer, while Mbappe has been linked with a move to Real Madrid. Next year a Qatari-owned PSG may have to compete with a Qatari-owned Manchester United. It looks like a chapter could be drawing to a close in Paris, with uncertainty over what comes next.

This week we’re taking a look back at F1’s first race of the season, which has raised a red flag over the sport’s competitiveness. Plus, CVC finally wrapped up its deal for tennis — but it’s much smaller than originally planned. Do read on

Max Verstappen was so dominant in the first grand prix of the Formula 1 season that one rival openly warned that his Red Bull team could win every race this year.

The Dutch driver is the clear early favourite to win his third driver’s title in a row, cementing his position as the man to beat in a sport long-dominated by seven-time champion Lewis Hamilton and the British icon’s Mercedes team.

Their rivalry has failed to reignite since a refereeing decision cost Hamilton an eighth world championship in Abu Dhabi in 2021. That’s largely down to Red Bull’s superior response to a big change last year: the sport’s introduction of a new car.

Sweeping changes are tough for F1 teams. They go away and work on their cars, but only learn how well they’ve done by measuring their relative performance against rivals in tests, practice runs and qualification. Mistakes are costly and hard to rectify. You can watch our recent video from McLaren HQ on what it takes to produce an F1 car.

Everybody was in awe of Red Bull’s pace in Bahrain. Mercedes driver George Russell said the championship is already “sewn up”.

That’s not what F1 had hoped for when devising new rules with its governing body, the FIA, to level the competitive balance in the sport.

Tight races are vital for any sport looking to build its audience. F1’s global boom coincided with Red Bull’s dash to break Mercedes’ eight-year grip on the constructors’ championship.

But following the introduction of the new cars last year, Mercedes slumped to third in the constructor standings, well behind Red Bull and Ferrari.

This year things look even more bleak for the team led by Austrian entrepreneur Toto Wolff, with Aston Martin’s Fernando Alonso making the podium in Bahrain. The result will have been particularly galling — Mercedes provides engines and other key components to Aston Martin.

Of course, one race doesn’t make a season. Aston Martin is allowed more time in the wind tunnel this season because of finishing lower down the grid last year, another way F1 is fostering competition.

Historically, Mercedes, Red Bull and Ferrari would outspend their rivals to stay ahead of the pack. But the introduction of a spending cap last year — another major top-down reform — means Mercedes can’t just spend its way back to the top.

The spending limit — set at around $137mn this year — was designed to foster competition and improve team finances. Over time, the cap should have its desired effect.

But in the short-term, preventing teams from throwing money at a problem looks set to rob F1 of its usual thrills.

This week, the Women’s Tennis Association announced a deal with buyout firm CVC Capital Partners in which the Luxembourg-based firm will form a new joint commercial venture with the tour, in an effort to boost the profile and prize money for the women’s game.

After years of looking for a way into the sport, CVC has agreed to pay a reported $150mn for a 20 per cent stake in the new business.

To recap: in 2021, the firm came close to a $600mn investment in a proposed joint entity between the WTA and the Association of Tennis Professionals — the men’s pro tour — to unite and grow their marketing, media and data rights. But the two sides never came to terms with CVC, in part because of a gulf in valuations between the men’s and women’s games.

Another big issue is the prize money for women’s tennis, which according to a data analysis by the FT’s John Burn-Murdoch, last year was 75 per cent lower than that paid to men across all tournaments besides the four Grand Slams. The Australian, French and US Opens as well as Wimbledon have together awarded equal purses to its male and female competitors only since 2007.

Addressing inequalities in the financing of men’s and women’s sport isn’t unique to tennis — there are yawning gaps in prize money for the Fifa World Cups and in salaries of NBA and WNBA players, to name just two. But tennis, with its roughly 11-month tour calendar and separate administrations for both games, has proven a particularly fraught challenge.

Some are sceptical of the role that private equity can play in creating long-lasting change. In recent years, the likes of CVC, Silver Lake, Elliott and others have tied up investments in football, rugby and cricket, while new sports-focused funds like Arctos and Red Bird have sprung up. But it remains an open question as to whether the traditional PE playbook of sprucing up a business and cashing out after five-to-ten years will work across the sporting world.

Any attempt at a swift exit by CVC would potentially leave WTA on the hook for finding a replacement stakeholder, or imperil the already-unequal finances.

For now, the WTA is optimistic, pointing to CVC’s 25 years of history in investing in sports properties, including as the former owner of F1. The firm held the motorsport tour for 11 years, selling it to Liberty Media in 2017 for a 450 per cent return on investment.

CVC has another important reason to make its WTA foray a roaring success: the potential to revive its original plans for a unified global tennis tour. The slimmed down deal will serve as a showcase for what private equity firms can achieve.

Call it a win-win.

GE HealthCare Technologies GEHC –1.85% (ticker: GEHC) was spun out of General Electric GE –0.61% (GE) after a tough 2022, a year marred by supply-chain problems and inflation. Investors, though, like what they’ve seen from the company so far in 2023, the inaugural year for the newly independent company. The stock has gained 26% since becoming a stand-alone publicly traded company on Jan. 4, outperforming the S&P 500 indexSPX –1.45% ’s 1.7% rise over the same span.

Now, GE HealthCare needs to deliver. Investors want to see progress on products and profit margins, enough at least to quell fears and expand valuation multiples, while the company works to prove that it can compete with the likes of Bayer BAYN –0.55% (BAYN.Germany) and Siemens Healthineers SHL –1.06% (SHL.Germany). GE HealthCare should be able to deliver, and investors willing to make the leap now—before seeing how things turn out—could well be rewarded.

“Despite the attractive setup, GE HealthCare shares are still trading at a…discount,” writes Mizuho Securities analyst Anthony Petrone. He expects that to close “with continued execution this year.”

Chicago-based GE HealthCare is new, but it isn’t small. It ended 2022 with roughly 50,000 workers and generated sales of $18.3 billion. The company is a leader in medical imaging—there are millions of GE MRIs and CT, PET, and ultrasound scanners in use around the globe—as well as patient-care solutions and pharmaceutical diagnostics. About half of GE HealthCare sales come from recurring parts and services.

Revenue growth in imaging is driven by investment in new products that improve health outcomes. GE HealthCare’s recently introduced products include a hand-held ultrasound unit that looks like something from Star Trek, and deep-learning software that improves diagnostic accuracy and lets doctors conduct more scans with the same equipment by upgrading old scanners without hospitals having to make new, multimillion-dollar purchases.

These advances, however, don’t come cheap: The company spent about $1 billion on research and development in 2022, and plans to spend 6% to 7% of sales on R&D in coming years. Still, GE HealthCare earned an operating profit of $2.9 billion in 2022 and is expected to report $3 billion and $3.2 billion in operating profit in 2023 and 2024, respectively.

Responsible for maintaining the balance between research and profitability is Peter Arduini, who became CEO of GE HealthCare at the start of 2022. He had worked at GE for 15 years before leaving for medical-device maker Baxter International (BAX). In 2012, he took the helm at Integra LifeSciences Holdings (IART), running that company until 2021, a period that saw the stock gain 16.6% a year on average, outperforming the S&P 500 by half a percentage point a year.

Then, GE CEO Larry Culp came calling, offering Arduini a chance to run a larger healthcare franchise. In the months leading up to the spinoff, he focused on getting the right people into the right jobs. “We’ve actually upgraded a significant amount of product management and commercial leaders,” Arduini says, adding that it has been easier to recruit people now that HealthCare is separate from GE.

While GE HealthCare stock has gotten off to a solid start, Wall Street has so far been little help to investors. Just four analysts cover the company, according to Bloomberg, and just two have price targets. Mizuho’s Petrone, who launched coverage of GE HealthCare on Feb. 17, is perhaps the most high-profile analyst to follow the stock. In his initiation, Petrone noted that he had surveyed 25 high-volume radiology sites across the U.S. and found significant pent-up demand for scans and procedures coming out of Covid, perhaps even better than the company expects. He rates the stock a Buy with a $90 price target, up 18% from Thursday’s close of $76.38.

With a dearth of research to rely on, looking at a comparable company can be helpful in valuing GE HealthCare and thinking about where its stock might be headed. Rival Siemens Healthineers, which became a publicly traded company in 2018 after raising money in an initial public offering, might provide the best comparison. On the surface, that comparison looks unfavorable. GE’s sales were flat over the past four years, while Siemens’ revenue has grown by 60%. GE HealthCare’s operating profit margins, meanwhile, have fallen below 15% from almost 20%, while Siemens’ profit margins are off by just one percentage point.

The difference has more to do with changes in the business mix than the way the companies are run. Siemens bought Varian Medical Systems in 2021, adding more than $3 billion in annual sales, the year after GE HealthCare sold its biopharma business to Danaher (DHR), as Culp sought to reduce GE’s corporate debt load. Accounting for all of the M&A activity, GE HealthCare’s sales grew at 7% last year, compared with Healthineers’ 6% sales growth.

Those differences shouldn’t cause a huge difference in valuations, yet GE HealthCare stock trades for about 12.8 times estimated earnings before interest, taxes, depreciation, and amortization, while Siemens Healthineers’ stock trades at 16.6 times Ebitda. Closing those gaps would also put GE HealthCare at about $90, up almost 20%.

And that’s just a start. GE HealthCare expects to grow sales at a mid-single-digit annual percentage rate while expanding profit margins to almost 20%. That growth and profit equation could yield earnings per share of more than $6 by mid-decade. If GE HealthCare stock trades in line with the market at that point, shares would be about $110 apiece—a 20% annualized gain.

Sometimes, it’s good to go it alone.

Kroger and Albertsons want to merge in a $20 billion deal. If antitrust regulators approve, the definition of a grocery store grows further.

As the country’s two biggest supermarket chains envision the future of their planned megamerger, you’ll be able to purchase groceries, a coffee, patio furniture, and your allergy medicine prescription. The store deduces you might also like a humidifier to help the sneezes and some local honey, all of which it has ready for you. At dinnertime, order in sushi, which was made by a kitchen owned by the supermarket.

When Kroger Co. KR -0.32% agreed to buy Albertsons ACI -0.10% Cos. for about $20 billion in October last year, it marked a milestone in the quest to invent the modern supermarket by rethinking what shoppers could buy while they pick up milk and meat for the week’s meals.

“You used to make money selling a can of corn,” said Rodney McMullen, Kroger’s chief executive, who started at the company in 1978 as a part-time bagger. Now, he said, “you have to figure out other ways of creating value for the customer.”

Just what this new emporium will look like is at the center of the Federal Trade Commission’s antitrust review, and central to any potential battle will be the shape-shifting definition of the markets in which Kroger and Albertsons are competing. Regulators are examining the possible combined company’s impact on grocery markets around the country as well as specific areas like online delivery, digital advertising and pharmacy operations, said people familiar with the matter.

Kroger executives said this month they are cooperating with regulators and that the deal is on track to close in early 2024. An FTC spokesman declined to comment.

Albertsons representatives declined to comment. Its Chief Executive Officer Vivek Sankaran said at a November Senate hearing that the merger was its best path to compete against Walmart Inc. and Amazon.com Inc., two retailing giants whose conquest of new markets has increasingly put them in direct competition with grocery stores.

Some lawmakers and union officials have expressed concern that the deal could lead to job cuts, stifled competition and price increases on food at a time of high inflation for basic goods.

The companies have said the merger would do the opposite. By expanding their network of suppliers, the united supermarket could more easily lower prices for customers and get fresh products to shelves more quickly. They have said they plan to increase wages for employees and promised no front-line worker layoffs.

The companies together employ more than 710,000 employees and operate nearly 5,000 stores, including Ralphs, Food 4 Less, Safeway and Vons among them. Both companies run stores in Southern California, Seattle and Chicago, as well as in other areas. They have more than 50 manufacturing plants and nearly 70 distribution centers.

Kroger executives have been open about seeing the company’s future beyond its grocery aisles. The chain already runs more than 1,000 Starbucks locations in stores. It is now setting up what the industry calls “ghost kitchens” across California, Texas and Ohio that allow customers to order restaurant meals and pick them up from some stores, without any actual restaurants. The company began delivering store-made sushi to people’s homes in December.

“We’re trying to improve our share of food away from home because we see it as a massive opportunity,” Mr. McMullen said at the company’s investor day last year.

Stretching the definition of a grocery store has helped both supermarket chains tap into faster-growing businesses and help fund operations. Kroger’s digital advertising business is one of its fastest-growing areas, and Albertsons’ sales and gross profit rose during the pandemic partly because it administered Covid-19 vaccines at its stores, executives at both companies have said.

Kroger uses consumer data to build loyalty programs and sell advertising to brands, putting it in emails, coupons and on its website. This brings it into competition with tech giants’ data-driven advertising arms at Facebook parent Meta Platforms Inc. and Alphabet Inc.’s Google. The supermarket is also staking out a presence on platforms such as Snapchat and smart TVs, another venue where the company can sell ads for products.

Albertsons in late 2021 started its digital advertising business, and the company is using data to offer coupons and rewards through its loyalty programs, which have grown to 33 million users. Albertsons’s digital offerings now include recipes and health-related content.

Besides being the biggest U.S. grocery store operator, Cincinnati-based Kroger has been expanding its private-label business to boost margins and capitalize on emerging trends in food. It runs more than 30 of its own plants that make store-brand fan favorites, including strawberry lemonade seltzer and unicorn-swirl ice cream. It has almost doubled the number of products it sells under its store brands since 2005, and these private-label products make up nearly 20% of its sales.

In Florida, where Kroger operates no physical stores, robots pick products in a 375,000-square-foot Kroger warehouse for online orders before drivers deliver them in trucks to homes. The company has opened additional warehouses in the state.

Michelle Packard, who lives in Coconut Creek, Fla., said she grew up near Kroger stores in Indiana and tried its delivery business after receiving fliers in the mail. She said the prices were good, and Kroger offered a wide range of products she can’t get elsewhere. Now, Ms. Packard said, she only goes to shops when she’s unable to find what she needs online.

The goal is to forge deeper and longer-lasting relationships with shoppers, said Kroger Chief Financial Officer Gary Millerchip, as the company competes for grocery sales against retailing giants like Walmart, Amazon.com and Costco Wholesale Corp.

“There are so many different players out there that we are fighting every day,” he said.

European grocery chains, including Aldi Inc., are gaining shoppers as they expand across the U.S. with a low-price, no-frills approach. Dollar, convenience and drugstores are growing their own food businesses to grab more consumer spending, while independent and regional retailers build out edgy brands with offerings like celebrity smoothies that go viral on TikTok.

As it roamed into entirely new markets, some of Kroger’s big ideas have failed. An effort to sell mortgages to shoppers proved overly complicated, Mr. Millerchip said. The company pulled the plug on a push into car insurance, partly due to complexities in state-to-state regulations. It sold hundreds of convenience stores in 2018 partly to cut costs, and has closed some jewelry stores.

Kroger has bolstered its health business so much that it is now one of the biggest pharmacy operators in the nation along with CVS Health Corp. , Walgreens Boots Alliance Inc. and Walmart. Kroger and Albertsons together operate nearly 4,000 pharmacies.

During the pandemic, Kroger and Albertsons administered millions of Covid-19 vaccinations at stores, drive-through centers and schools. Executives at both companies have said the health business helps them build shopper loyalty, and this year Kroger is offering testing for colorectal cancer at some of its pharmacies and health clinics.

Karen Brokken, who lives in Tigard, Ore., said she started going to an Albertsons pharmacy in her neighborhood after other drugstores became busier. Last year, she got a flu shot and a Covid-19 booster shot at Albertsons and received coupons that gave her 10% off with each vaccination, she said.

“I get some basic stuff there” such as peanut butter, she said, adding that she buys groceries at Albertsons when she goes to pick up her prescriptions from the pharmacy.

Kroger traces its roots back to a single store that Barney Kroger opened in Cincinnati in 1883. The company added its first in-store meat department in 1904, later opening its first pharmacy in 1961 as it spread new stores across the country and bought rival chains.

The supermarket model—where shoppers could buy fruits, vegetables, milk and meat all in one place—gained popularity in the U.S. during the 1930s, with early stores primarily focusing on offering low prices. Amid population growth across the country, businesses opened more stores and operators began adding a wider range of products and services like in-store bakery shops.

Albertsons, too, started as a single store in Idaho in 1939, where it was known for its store-made ice cream and racks of magazines—novelties to shoppers at the time. Later, it added processing plants and now runs 19 of its own production facilities for milk, baked goods and other foods. Boise, Idaho-based Albertsons now makes about 10% of its store brands, which executives say are growing faster than branded items. The company has also been testing mobile clinics in Texas for pets that offer exams and vaccinations.

Albertsons, like Kroger, seeks to fill a broader range of shoppers’ needs, and broaden the number of households the company serves, executives say. “You can complete a basket in our store. Absolutely get everything you want,” Mr. Sankaran said at an industry conference in 2021.

Albertsons said in February 2022 that it was exploring strategic alternatives, including a sale, less than two years after it went public. Some industry analysts have said the company’s ownership structure has weighed on the stock price. Private-equity firm Cerberus Capital Management LP invested in Albertsons in 2006 with subsequent investments and holds about a 27% stake.

Kroger officials reached out to Albertsons in late April about a potential acquisition, according to a filing with the Securities and Exchange Commission, and Kroger signed the deal to acquire Albertsons in October.

In recent months, FTC officials have reached out to grocery retailers and wholesalers of varying sizes across the U.S., inquiring about their business models, which companies they see as competitors, and their view of the proposed Kroger-Albertsons deal, said people familiar with the matter.

Officials are asking about how products are sourced, priced and sold by suppliers and how online operations work, some of the people familiar with the discussions said. They are also looking into usage of shopper data, pharmacy operations and private-label businesses of Kroger and Albertsons, some of the people said, as well as store labor dynamics.

Traditionally, antitrust investigations of supermarket mergers have zeroed in on specific geographic areas where companies operate overlapping stores, examining whether mergers would reduce competition. Regulators haven’t typically included discount or club stores like Walmart’s Sam’s Club or Costco in evaluating supermarket mergers, nor have they looked at newer facets of the business such as data analytics, said industry and antitrust officials.

The evolution of what grocery stores sell is a complicating factor in analyzing the effects of a supermarket merger, said Logan Breed, who leads the antitrust practice at law firm Hogan Lovells International LLP. It isn’t clear that the antitrust authorities’ model for analyzing such deals still works given the industry’s changes, he added. Mr. Breed, who has worked on other supermarket tie-ups, said he isn’t involved with the Kroger-Albertsons merger.

Both the FTC and the Justice Department are “extraordinarily aggressive” in their enforcement, he added. The regulators have challenged deals including JetBlue Airways Corp.’s purchase of Spirit Airlines Inc. and Penguin Random House’s acquisition of Simon & Schuster. A federal judge blocked the publishing deal.

Antitrust authorities’ remedy for supermarket mergers hasn’t always been smooth. In 2015, Albertsons bought back 33 stores that the FTC had required the chain to sell as a condition of approving its acquisition of Safeway Inc. After Albertsons sold stores to smaller chain Haggen Holdings LLC, Haggen struggled to integrate them and filed for bankruptcy within months.

Kroger has said that the regulatory process could take up to two years. A so-called second request for information, during which FTC officials gather information on the companies and the sector, can take at least several months, antitrust experts said.

The companies have said they expect to sell stores in some markets to seek regulatory approval, and have agreed to sell up to 650 stores. They are working to identify potential buyers and have received interest for those they expect to divest.

“What is a modern grocery store?” said Suzy Monford, who previously led e-commerce and fresh food departments at Kroger and now leads consultancy Food Sport International. “We feed you. We clothe you. We help you manage all your prescriptions. We are the place you go to when you celebrate.”

The circle of life

There’s no business like the stablecoin business. People lend you money expecting nothing more than to get it back, one-for-one. All you have to do is place their money somewhere that generates interest greater than zero.

Circle, owner of USDC, the second-biggest stablecoin and the fifth-biggest cryptocurrency by market capitalisation, chose to deposit a lot of the money in Silicon Valley Bank. Oops.

And also . . . 

“A black swan failure”, according to Circle chief strategy officer Dante Disparte — yes, really — who was presumably consulted on the group’s strategy of harvesting interest on uninsured deposits at a specialist regional bank whose share price looked like this:

Ahead of a tilt for a stock market listing that ultimately failed, Circle said in August that deposits would be “exclusively backed by cash and short-term US government debt”.

But the big problem facing stablecoins is being able to give the money back on demand while earning enough in interest to pay operating costs, buy yachts, etc. Had Circle kept cash in a big vault it probably wouldn’t have been able to claim a $50bn valuation, whereas if it put too much money in long-dated T-bills and whatnot, it would have been inviting a liquidity crisis.

Circle chose instead to outsource liquidity management to a subscale bank that put the money in long-dated T-bills and whatnot.

At pixel, awaiting news on whether bank regulators will indirectly bail Circle out, USDC is trading on the secondary market at 90 cents to the dollar:

Here’s what the community makes of it all:

In Europe, Zalando (ticker: ZAL.Germany) is trying to do for fashion what Amazon AMZN –1.65% . com did for books more than two decades ago—crack the code for selling to the masses online.

Clothes are a little trickier to sell online. People still like to buy them in person because the feel, the fit, and the small details matter so much. Returns from online purchases are more frequent, especially when you can’t try things on before you buy.

Zalando’s answer is to become the go-to platform between consumers, retailers, and fashion brands. Zalando works with more than 6,500 international brands in 25 European countries. Like Amazon, it shares logistics with partners. It also offers its own private-label clothes.

In fiscal 2024, “the online apparel market in Europe could once again grow faster than the physical stores market,” said Anne Critchlow, an analyst at Societe Generale. “Moreover, we think Zalando could take online market share in the future as it has in the past, helped by the breadth of its platform and free shipping and returns proposition.”

Zalando has the potential to build bigger margins than competitors because it doesn’t attempt to undercut others on prices. But it is “market-disruptive in its breadth of choice, one-stop-shop convenience and superior online service,” Critchlow said.

Berlin-based Zalando, with a market value of €10 billion, sells shoes, apparel and accessories. The company fetches 60 times this year’s expected earnings and is valued at a 60% premium to its peers. Clement Genelot, an analyst at Bryan Garnier in Paris, said Zalando’s high price-to-earnings ratio is because of its low margins so far and its willingness to reinvest profit for future growth.

The shares are up 22% over the past three months to €38.33. The average target price among those collected by FactSet is €45.29, implying a nearly 20% upside. Thirteen analysts rate the shares the equivalent of Buy, seven have it as a Hold and one analyst gives it an Underweight rating.

Founded in 2008, Zalando had a crazy ride through the pandemic. Demand boomed during lockdowns, along with its share price. Things cooled off dramatically in 2022 as economies opened up to physical interactions. Shares climbed as high as €100 in mid-2021 and fell as low as €20 last September.

Last month, Zalando announced that it will be cutting jobs to keep a lid on costs. “Zalando’s 5% layoff plan, the first in its history, is surprising but outlines the group’s willingness to pivot from ‘growth-at-all-costs’ to profitability,” said Clement Genelot, an analyst at Bryan Garnier in Paris, who rates the shares a Buy with a price target of €50. “This welcome shift is key to our investment case.”

The outlook for Zalando will depend on European consumers. Just like in the U.S., shoppers are dealing with the fastest inflation in 40 years and higher energy costs. Consumer confidence plummeted through most of 2022, but started to recover at the end of the year. The worst case scenario for winter—energy shortages and rolling blackouts because of the supplies lost from Russia after it invaded Ukraine–haven’t come to pass, and unemployment has remained low.

The European Central Bank may be raising interest rates faster than the Federal Reserve now, but the economy has held up better than expected so far.

Zalando reported a 60% drop in earnings in 2022. But CEO Robert Gentz on March 7 painted a bright picture for the future. The company expects to get to the top end of its 3% to 6% target range for profit margin by 2025 and sees double-digit margins in the longer term.

Volatile markets are tricky for investors to navigate, but that doesn’t mean they lack opportunities—especially for activist investors.

After a 19% drop in 2022, the S&P 500 index is up about 1% so far this year. Yet the broader market’s performance belies the tension among sectors, and even within sectors, as investors try to figure out the best places to allocate capital in a market convinced that a recession is looming.

It’s the type of market that usually attracts activists. Indeed, this year we’ve seen activist hedge funds choose big targets such as Walt Disney DIS –2.67% (ticker: DIS) and Salesforce CRM –3.10% (CRM), to some early success. Trian Partners backed down from a threatened proxy fight at Disney after the company agreed to cost-cutting measures, and Salesforce delivered a blowout quarter while carrying on its back at least five activists pushing for changes.

And there are even more enticing opportunities that may lure additional cage rattlers, according to Wolfe Research. Each month, the research firm screens companies to find ones that have underperformed either the S&P 500 or their own sector while also experiencing weaker margins. This month, 11 new names were added to Wolfe Research’s screen, including eBay EBAY –2.12% (EBAY), Whirlpool (WHR), Constellation Brands (STZ), and Kellogg K –0.36% (K).

While appearing on a screen is no guarantee that an activist will approach, a screen can be a useful tool for sussing out investment opportunities—possibly even before an activist boost.

Vietnam’s economy is on fire. Gross domestic product growth hit a 25-year high of 8% last year. Foreign direct investment surged to $22 billion as multinational corporations sought alternatives to China.

So why is its stock market barely flickering? Global emerging markets have rallied by 9% since Nov. 1. The VanEck VietnamVNM +0.17% exchange-traded fund (ticker: VNM) did nothing. It’s down by half from a peak in early 2022.

The culprits are usual suspects for meltdowns in emerging markets, and not only emerging markets: overleveraged real estate and political shifts that may not be in investors’ favor.

Vietnam’s Communist authorities are less than transparent in assuaging capitalists’ fears. “We’re not re-entering Vietnam yet because the systemic fallout from the real estate bond crisis is still unknowable,” says Alison Graham, chief investment officer at frontier markets specialist Voltan Capital Management.

Easy money and postpandemic boomerang spending stirred developers’ animal spirits in Vietnam. The government, scarred by banking crises earlier this century, limited bank lending. So builders turned to the new alchemy of the bond market.

Banks snapped up these bonds and bundled them for retail investors, promising double-digit returns instead of the 3.5% or so they were paying on deposits. Sound familiar yet?

The first prick in the bubble came last October when authorities arrested the chairwoman of go-go developer Van Thinh Phat Holdings Group on fraud charges. It won’t be the last, predicts Abhijit Kukreja, senior vice president of emerging markets equities sales at Auerbach Grayson.

“The bond market is frozen. Vietnam will go through its Evergrande moment,” he says, referring to fallen high flyer China Evergrande Group.

Vietnam’s normally placid politics are roiled, too. A scandal involving alleged price gouging on Covid test kits forced the resignation of business-friendly President Nguyen Xuan Phuc in January. Charges of “violations and wrongdoing” masked a reactionary power play by aging Communist Party boss Nguyen Phu Trong, says Jonathan Binder, chief investment officer at Consilium Investment Management.

The new president is a former Party propaganda chief who kicked off his term urging “steadfastness in creative development of Marxism, Leninism, and Ho Chi Minh thought.”

“I see a parallel with China: using anticorruption as an excuse to consolidate power,” Binder says.

The good thing about market collapses is that they can yield attractive prices for solid companies. Kukreja presents a shopping list of Vietnamese blue chips that offer great long-term value: Bank for Foreign Trade of Vietnam (VCB.Vietnam), Vietnam Dairy Products (VNM.Vietnam), Saigon Beer Alcohol Beverage (SAB.Vietnam), and IT services champion FPT (FPT.Vietnam). “We still think Vietnam is very well placed for decades to come,” he says.

Voltan’s Graham is not so sure. Industrial investors in Vietnam face a welter of infrastructure challenges China has already solved: roads, ports, land acquisition, electricity. “The basic Vietnam growth story is intact, but without some of the hyperbole,” she says.

Another big risk factor: Domestic investors, many of them novices, account for 90% of Vietnam’s stock trading, Graham says. Foreigners’ holdings are capped in the most sought-after companies. That would make the market volatile under any circumstances.

Vietnam’s transformation certainly bears watching, carefully.