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Good morning investors!

If this is your first time reading, welcome to The Investor’s Edge — a thriving community of over 21,000 subscribers striving to be better investors with an edge in the market.

Every weekend we publish “The Weekly Wrap-Up” — your ticket to being well informed and staying ahead in the investment game!

This report is designed to help investors of all skill levels break down important stories/topics within the stock market. And best of all, we cut through all of the BS and give you exactly what you need to know in easy to digest, bite sized pieces of content.

Grab your coffee and let’s dive in.

Market Talk

All three major indexes ended the week in the red as a strong labor market raised concerns regarding inflation.

3 Stories Moving the Market

These are some of the biggest stories from the second half of the week that had an influence on market action.

U.S. payrolls grew by 256,000 in December, much more than expected; unemployment rate falls to 4.1%

Job growth in December was significantly stronger than expected, with nonfarm payrolls rising by 256,000, exceeding the forecast of 155,000, and the unemployment rate edging down to 4.1%.

Growth was driven by health care (+46,000), leisure and hospitality (+43,000), government (+33,000), and retail (+43,000), which rebounded after losing 29,000 jobs in November.

Revisions for prior months were minor, with October revised up by 7,000 and November revised down by 15,000.

Wage growth remained modest, with average hourly earnings rising 0.3% month-over-month and 3.9% annually, suggesting easing wage inflation pressures.

Stocks dropped on the news, and Treasury yields surged as the strong jobs data reduced the likelihood of Federal Reserve rate cuts this year. Markets now expect only one rate cut in 2025, with the probability of a single cut rising to 68.5% after the report.

Constellation Energy to buy Calpine in $26.6 billion deal

Constellation Energy announced plans to acquire privately held Calpine Corp, a geothermal and natural gas energy company, in a $26.6 billion cash-and-stock deal, including debt.

The acquisition, expected to close in the second half of 2025, would add $2 billion to Constellation's annual free cash flow and expand its clean energy portfolio to nearly 60 gigawatts of zero- and low-emission capacity, including nuclear, natural gas, and geothermal energy.

The deal aligns with rising electricity demand, as forecasted by the U.S. Energy Information Administration.

Calpine, an independent power producer that sells electricity at market prices, was taken private in 2017 by Canadian Pension Plan Investment, Energy Capital Partners, and Access Industries, who had been exploring sale options since May 2024.

News of the acquisition sent Constellation's shares up 24%.

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Delta outlook tops estimates as CEO expects 2025 to be airline’s ‘best financial year in our history’

Delta Air Lines reported strong quarterly earnings and revenue, surpassing analysts' expectations due to robust demand across its diversified revenue streams.

The company achieved net income of $843 million, down 59% year-over-year, on quarterly revenue of $14.44 billion, up 6% YoY and ahead of estimates by 1.69%. Adjusted EPS of $1.85 beat expectations by 5.11%.

Key highlights include operating income of $1.7 billion, a 30% YoY increase, driven by premium products and loyalty program revenues, which grew 8% and 5% YoY, respectively. Operating cash flow surged 247% YoY to $1.9 billion, while the company reduced debt by $3.6 billion to $18 billion. Other notable achievements included a 99% YoY increase in refinery revenue and the delivery of 38 new aircraft in 2024.

For Q1 2025, Delta expects revenue growth of 7% to 9% YoY and EPS of $0.70 to $1.00. For the full year, it forecasts EPS above $7.35 and free cash flow exceeding $4 billion, reflecting continued operational strength and demand resilience.

In Other News

In this section, we'll be curating a selection of news headlines we think you'll find interesting. If a topic catches your eye, click the provided links to read more about it.

• US Consumer Inflation Expectations Jump to Highest Since 2008

• TikTok ban likely to be upheld by Supreme Court

• Walgreens shares soar 27% on big earnings beat, as drugstore chain cuts costs

• Tesla launches refreshed Model Y in China to fend off domestic rivals

• US Treasury Yields Test 5% as Traders Push Out Fed Rate Cuts

• AbbVie Takes $3.5B Impairment Charge for Failed Schizophrenia Drug

• McDonald’s to close three CosMc’s locations — and open two more

• Hershey Set to Announce CEO Transition, Semafor Reports

• Crude oil prices jump as U.S. imposes sweeping sanctions against Russia oil industry

Edge+ Posts of the Week

We continue to push out more and more content every week to give investors that edge. Here are the posts Investor’s Edge+ subscribers received this week.

The Edge Report

Mondays are for the investors. Every Monday morning we share exactly what we’re watching in the week ahead, how we’re positioning, and even share a sneak peek into our systems and models. This week we discussed the upcoming jobs reports and how we were preparing for them. See the latest full report here:

The Options Edge Report

This week, we dropped the second Edge Options Report for our members—packed with actionable insights and options strategies. This week we broke down a play on Nvidia. See the latest report here:

Edge Quick Picks

Every month we break down 5 stocks that we believe are attractive from a valuation perspective right now. See the 5 stocks we are buying in December:

The Week Ahead

Inflation will be the focus next week as two key reports are on the calendar, though earnings season kicks off as major banks are set to report which will also have huge implications.

Earnings Reports

Banks are set to kick off earnings season next week, along with some other major names. Here is the list of names we will be covering next week:

• Monday 1/13: --

• Tuesday 1/14: --

• Wednesday 1/15: JP Morgan, Goldman Sachs, and BlackRock

• Thursday 1/16: Taiwan Semi, UnitedHealth, Bank of America, and Morgan Stanley

• Friday 1/17: --

Here is the full calendar of scheduled earnings releases:

Economic Reports

Next week will be all about inflation as we get both the CPI and PPI reports.

There will also be retail sales, initial jobless claims, manufacturing data, several housing reports and a number of speeches from key Fed members.

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Thank you for reading this edition of the Weekly Wrap-Up. Have a great weekend!

Until next time investors!

Mark & Chris

The Investor’s Edge

Disclosure

This is not investing advice. It is very important that you do your own research and make investments based on your own personal circumstances, preferences, goals and risk tolerance.