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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 23,000 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.

Edge Announcements

🚨 MEETING REMINDER 🚨

Today, 5/17, is the Monthly Meeting exclusively for Edge+ members. The meeting will be hosted by Mark at 10 AM EST.

Here's what we will be covering

• A deep dive into Mark's personal portfolio, recent moves, and his top 10 individual holdings 

• Exclusive insights into the stocks we’re watching closely, complete with Edge scores and analysis

• A breakdown of the most intriguing charts we’ve seen recently

• PLUS, a live, interactive Q&A to get your burning questions answered

Market Talk

It was a sea of green this week following the trade truce news between U.S.-China.

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.

UnitedHealth Group shares plunge on report of DOJ probe into possible Medicare fraud

UnitedHealth is under federal criminal investigation by the Department of Justice for potential Medicare fraud tied to its Medicare Advantage billing practices. The probe, active since at least last summer, intensifies existing scrutiny into the company’s conduct, which already includes civil fraud and antitrust inquiries. The company denies receiving formal notice from the DOJ and says it stands by the integrity of its program.

🔑 Key Points

• UnitedHealth’s Medicare Advantage unit, its largest revenue generator at $139B in 2024, is the focus of the probe.

• The company has lost over $300 billion in market cap, with shares plunging ~50% in one month.

• DOJ scrutiny adds to a list of problems: cyberattacks, rising medical costs, and CEO turmoil (Andrew Witty replaced suddenly by Stephen Hemsley).

• The probe follows prior civil investigations into alleged inflated diagnoses used to secure higher government reimbursements.

• A past whistleblower case alleging $2B in unsupported Medicare billing may now gain fresh attention.

👀 What You Need to Know

This DOJ criminal investigation signals growing federal focus on insurers profiting from Medicare Advantage, an industry long criticized for aggressive upcoding. For investors, this marks a critical inflection point: UnitedHealth is facing a trust crisis from regulators, shareholders, and the public. Unless sentiment reverses swiftly, the company could risk index removal and long-term multiple compression. Despite its massive size, UNH is no longer “too big to question.”

Hedge Fund Q1 Moves: What the Smart Money Is Doing

The Q1 2025 13F filings from top investors offer a revealing look at where capital is rotating, and where confidence is breaking. Buffett, Burry, Ackman, and Tepper made aggressive and sometimes defensive moves this quarter as macro risks and valuations shifted. From Nvidia and Alibaba to Uber and Estee Lauder, the dispersion is striking.

🔑 Key Points

• Warren Buffett (Berkshire) showed restraint, with minor changes. He trimmed Bank of America (-7%) and DaVita, while modestly adding to Occidental and Verisign. His boldest moves were a 144% increase in Pool Corp. and a 114% add to Constellation Brands.

• Michael Burry (Scion) went full scorched-earth, liquidating nearly everything: full exits from BABA, JD, BIDU, HCA, PDD, and others. He replaced them with a single new position: Estee Lauder (EL), taking a 50% portfolio stake in the battered beauty giant. A bold contrarian bet.

• Bill Ackman (Pershing Square) continues consolidating, focusing firepower on a few high-conviction names. Uber is now 18.5% of the portfolio (30M shares added), while GOOG/GOOGL is approximately 14%. Portfolio remains tightly concentrated in 11 stocks, with Uber, Brookfield, Alphabet, and Restaurant Brands dominating.

• David Tepper (Appaloosa) trimmed across China tech (BABA, JD, BIDU), semis (NVDA -56%, AMD -100%, MU -67%), and megacaps like Microsoft (-47%). He added to Uber (+113%), Meta (+12%), and made new buys in L3Harris, Deutsche Bank, and Block.

👀 What You Need to Know

Smart money is rotating. Tepper’s exit from semis and Chinese names mirrors Burry’s total unwind, signaling risk-off for high-beta and geopolitically exposed sectors. Ackman remains concentrated but nimble, while Buffett is sticking to quality with small, targeted adds. Across the board, Uber was a common winner, adding to its recent strength. The divergence in strategy reflects an uncertain macro backdrop where even titans disagree on what comes next.

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Earnings Roundup: Walmart Holds Its Ground, Alibaba Slips

Walmart and Alibaba reported earnings that underscore how macro pressures, from tariffs to consumer caution, are reshaping global retail. Walmart delivered an earnings beat and its first-ever profitable quarter in e-commerce, even as revenue narrowly missed expectations. Meanwhile, Alibaba missed both top and bottom-line estimates, rattling investors despite solid gains in AI and cloud. Both giants are navigating very different markets but neither is immune to rising global uncertainty.

🔑 Key Points

• Walmart $WMT ( ▲ 1.96% ) beat on EPS ($0.61 vs. $0.58 est.) but missed on revenue ($165.61B vs. $165.84B est.), marking its first miss since 2020.

• U.S. same-store sales rose 4.5%, while e-commerce surged +21% in the U.S. and +22% globally. Digital ads jumped 31%.

• Tariffs remain a major headwind. CFO warns consumer prices may climb sharply in June as 30% duties hit imports.

• Alibaba $BABA ( ▼ 0.36% ) fell short with revenue of $32.58B vs. $33.01B est., and net income of $1.72B vs. $3.43B est., despite YoY net income jumping 279%.

• Cloud revenue grew 18% YoY; AI product revenue posted triple-digit growth for the 7th straight quarter.

👀 What You Need to Know

Walmart is proving it can withstand inflationary shocks by leaning into e-commerce, advertising, and grocery scale, growing profits even in a pressured sales environment. Alibaba, while aggressively investing in AI and cloud, still faces steep competition, macro drag, and volatile earnings. Both remain critical barometers of consumer strength and trade risk, but only one showed margin expansion and strategic flexibility this quarter.

*Note - our full breakdown and Edge takeaway of these reports, as well as all of the companies we follow that reported this week, was sent out in Friday’s Earnings Recap.

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.

• Trump says he doesn’t want Apple building products in India

• Fed’s Powell cautions about higher long-term rates as ‘supply shocks’ provide policy challenges

• Nvidia says it is not sending GPU designs to China after reports of new Shanghai operation

• Google is testing AI search on its homepage

• U.S. producer prices unexpectedly fall in April

• U.S. cable giants Charter and Cox pursue $34.5 billion merger

• U.S. poised to dial back bank rules imposed in wake of 2008 crisis

• Apple blocks Fortnite App Store resubmission after court ruling, Epic Games says

• Novo Nordisk ousts CEO as Wegovy maker faces growing competition

• Applied Materials Stock Slides as China Sales Shrink

• Dick’s Sporting Goods to acquire Foot Locker for $2.4 billion in effort to corner Nike market

• Deere beats second-quarter estimates on cost cuts, trims annual profit forecast

• Cava revenue beats estimates as Mediterranean chain reports double-digit same-store sales growth

• Take-Two Interactive Q4 Earnings and Revenues Beat Estimates

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 trade deal, upcoming inflation reports and the earnings in the week ahead from names we cover. See the latest full report here:

Portfolio Update - May

Every month we share a full access look into our portfolios, including holdings, performance, activity and our watchlists for the upcoming month. You can see both of our portfolios here and see what moves we made in April:

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 May:

The Options Edge Report

This week we dropped the latest Edge Options Report for our members—packed with actionable insights and options strategies. We broke down a play on TSLA following its recent run. See the latest report here:

Earnings Recap

Every week during earnings season is extremely busy for us here at the Edge as we dive into over 100 reports and provide our members with top tier breakdowns and insights. This week we saw earnings from Walmart, Alibaba, and Deere & Co. See this week’s recap:

The Week Ahead

Overall, it’s a quiet week data wise, but markets are headline driven right now so any tariff news or comments from the administration could cause a huge swing in the blink of an eye.

Earnings Reports

As earnings season winds down, there are still 4 names we cover here at Edge on the calendar next week. Here is the list of names we will be covering:

• Monday 5/19: --

• Tuesday 5/20: Home Depot and Palo Alto

• Wednesday 5/21: Lowe’s and Target

• Thursday 5/22: --

• Friday 5/23: --

Here is the full calendar of scheduled earnings releases:

Economic Reports

Next week is very quiet on the economic news front. We get initial jobless claims, S&P composite PMI, existing home sales and new sales data.

There will also be several Fed speeches sprinkled throughout the week, all of which have the ability to move markets.

The Investor’s Edge Discord is a HUGE benefit of being a subscriber - don’t miss out, it’s FREE!

If you are only reading the newsletter, you are only getting a fraction of the benefits of being an Edge subscriber.

Our Discord server is tailor-made for investors like you who want to dive deeper into stocks, share insights, and engage directly with us. And it’s completely free!

Here’s what you’re missing in the Discord:

🗨️ Chat rooms: Investors discussed the the huge moves from mega cap tech. Members also dove into the number of jobs reports and shared their views on the overall economy.

📊 Earnings / Economic reports: No more waiting for our newsletters to hit your inboxes - see earnings results and economic data as they are released. And more importantly, get our reactions and insights immediately.

🚨 Trade Alerts: Chris and Mark shared several trades, including additions to the portfolio and trades that set up their portfolios for the week.

Join us on Discord and let's level up our investing game together. The future of trading awaits—and you're invited to be a part of it! 🌟

Want more? Check out our other resources

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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.