Alphabet Rises on Strong Earnings while Mattel Falls on Lowered Guidance

Alphabet Rises on Strong Earnings while Mattel Falls on Lowered Guidance

Last week, the Opportunity Equity Strategy’s representative account gained 1.82%, outperforming the S&P 500’s 1.47% rise. (Exhibit 1). The strategy ended the week up 12.39% YTD, 297 basis points ahead the S&P 500.

Exhibit 1: Performance of Opportunity Equity Representative Account Net of Fees, Versus S&P 500, Through 7/25/25¹

Time Period	Opportunity Equity Representative Account	S&P 500
Last Week (7/18- 7/25)	1.82%	1.47%
MTD	7.25%	3.03%
QTD	7.25%	3.03%
YTD	12.39%	9.42%
1 Year	24.63%	19.92%
5 Year	12.39%	16.46%
10 Year	8.84%	13.88%
Inception (annualized since 6/26/00)	8.07%	8.08%

Shares of Illumina, Inc. (ILMN) rose on headlines that Cathie Wood was buying the stock for her Genomic Revolution ETF.

Tarun Lal, the newly appointed CEO of Dave & Buster's Entertainment, Inc. (PLAY), purchased approximately 8,100 shares of the company’s stock for around $250K.

Alphabet Inc. (GOOGL) rose after announcing strong earnings that topped both revenue and profit expectations. The company posted revenue of $96B, up 14% y/y, beating the $94B consensus estimate. Earnings per share (EPS) came in at $2.31, up 22% y/y ahead of the expected $2.17. The beat was broad based. Search revenue rose 12% y/y versus 10% expected and YouTube ad revenue increased 13% versus 11% expected. Google Cloud was a standout. Cloud revenue grew 32% y/y versus 28% expected and operating income surged 141%, as margins expanded from 11% to 21%. The company also repurchased $13.6B in stock during the quarter (roughly 0.6% of its current market cap) and still has $86.3B remaining under its buyback authorization. Following the results, Evercore raised its price target from $205 to $240 (24% upside) and labeled Alphabet a “dislocated high quality” (DQH) stock, citing it’s discounted p/e multiple versus the market.

UBS Group AG (UBS) reached a new all-time high last week as it heads into the print.

Seadrill Limited (SDRL) rose on limited news.

Exhibit 2: Significant² Contributors to Opportunity Equity Representative Account Performance, 7/18/25 - 7/25/2025

Name	Type	Net Return
Citigroup Inc.	Equity	13.7%
Alibaba Group Holding Ltd	Equity	9.5%
Coinbase Global, Inc.	Equity	4.4%
Nvidia Corp	Equity	6.6%
Norwegian Cruise Line Holdings Ltd.	Equity	7.4%

Piper Sandler raised their price target on Coinbase Global, Inc. (COIN) from $190 to $350 (-11% downside). While Piper expects Coinbase to emerge as the dominant player in crypto and digital assets over the long-term, they believe the stock’s recent rally has limited its near-term upside.

Precigen, Inc. (PGEN) fell on limited news.

Mattel, Inc. (MAT) dropped below its 50-day, 100-day, and 200-day moving averages following an earnings report that met expectations but included lowered forward guidance. The company reported revenue of $1.02B versus $1.06B expected, and adjusted earnings per share (EPS) of $0.19 versus $0.15 expected. However, Mattel revised its full-year 2025 guidance downward, lowering operating income from $740–$760M to $700–$750M, free cash flow (FCF) from $600M to $500M (9% FCF yield), and adjusted EPS from $1.69 to $1.60 at the midpoint. The company purchased $50M shares during the quarter (1% of current market cap) and intend to purchase $600M during FY25 (10% of current market cap). Mattel also reduced its expected FY25 tariff impact from $270M to under $100M, which is expected to be offset by its ongoing cost-saving program. DA Davidson maintained its $30 price target (72% upside). They view the reinstatement of full-year guidance, albeit lower, as a positive signal.

Jefferies raised their price target on SoFi Technologies, Inc. (SOFI) from $19 to $27 (27% upside).

Exhibit 3: Significant² Detractors from Opportunity Equity Representative Account Performance, 7/18/2025 - 7/25/2025

Name	Type	Net Return
Coinbase Global, Inc.	Equity	-6.7%
Precigen Warrant Restricted	Equity	-9.9%
Precigen, Inc.	Equity	-10.8%
Mattel, Inc.	Equity	-10.0%
SoFi Technologies, Inc.	Equity	-2.8%

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As of prior week's market close unless otherwise stated.

¹The performance figures for the representative Opportunity Equity account reflect the deduction investment management fees and certain other expenses. Returns greater than 1 year are annualized.

For additional information about Opportunity Equity Strategy performance, please click on the Opportunity Equity Strategy Composite Performance Disclosure. Past performance is no guarantee of future results.

²Significant Contributors and Detractors are based on holdings that had the greatest effect on representative account performance for the week. Holdings that have been in the portfolio since the end of the most recent calendar quarter are identified by name. The net return shown above for each individual security represents the change in market price of the security during the week, according to a third-party pricing service, or for the partial period held in the portfolio during the week.  Net returns also include any purchases or sales that were made during the week. For information on how Contributor/Detractor data were calculated and a list showing the contribution to the Strategy’s weekly performance of each investment held at such quarter end, contact us.

Any views expressed are subject to change at any time, and Patient Capital Management disclaims any responsibility to update such views. There is no guarantee that market trends discussed herein will continue. The information presented should not be considered a recommendation to purchase or sell any security and should not be relied upon as investment advice. It should not be assumed that any purchase or sale decisions will be profitable or will equal the performance of any security mentioned. Past performance is no guarantee of future results, and there is no guarantee dividends will be paid or continued. References to specific securities are for illustrative purposes only. Portfolio composition is shown as of a point in time and is subject to change without notice. Content may not be reprinted, republished or used in any manner without written consent from Patient Capital Management. 

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