We had an election this week, and the market reaction was star-spangled (Fab Five +$414B, Talco Top Five +$17B). As of this writing, it is likely that the Republicans will control both chambers of the Legislature, as well as the Executive branch.
We will write more on the implications of this, but a couple of observations:
- Ted Cruz won reelection and will become Chairman of the Senate Commerce Committee. Senator Cruz has been critical of the BEAD process. We think he will be active in streamlining reforms for both the NTIA (perhaps new guidelines to increase bidding competition, clarification on Davis-Bacon and prevailing wage) and USF.
- Elon Musk owns and runs Starlink. One has to think that they get a larger seat at the broadband table.
- M&A is going to get easier. If interest rates come down thanks to resumption of pre-COVID spending levels, transaction volume should increase. (Note: Ziply announced that they were going to be purchased by a subsidiary of Bell Canada this week for $7.0 billion Canadian inclusive of debt).
- The light switch moves back to policies that are less focused (and friendly) to net neutrality.
We will write more on the election next Sunday. File is below. The net debt balances have been updated, as well as the share counts for all 10 stocks we track but the other schedules will not be updated until next Sunday.
Have a great week, and Go Chiefs!
