MERIDIAN RESEARCH

The macro backdrop on May 3 remains in a "soft landing with cracks" configuration. Per FRED data pulled this morning: Fed Funds at 3.64%, 2Y Treasury at 3.88% (10Y not refreshed in this pull — flagging data gap), unemployment at 4.3%, real GDP growth at 2.0%, S&P 500 at 7,230, VIX at 16.89, and HY credit spreads at 283 bps. None of those readings individually signal stress — credit spreads are well inside long-term medians, the VIX is benign, and the curve has materially un-inverted. But the 2Y at 3.88% sitting above the policy rate suggests the market has effectively priced out further easing in the near term, which is a meaningful change from the disinflation-driven cut narrative of late 2025. CPI YoY was not refreshed in this pull (flagging — will reconcile against next BLS release).

The overnight tape has two thesis-relevant headlines. First, Spirit Airlines (SAVE) ceased operations (Source: NPR, NBC News). This is a structurally important event — it removes ~5% of US domestic ULCC capacity, is bullish on yields for legacy carriers and Southwest, and validates the thesis that the post-COVID ULCC model is broken under higher fuel and labor costs. Second, gasoline prices spiked in the Midwest following a power loss at BP's Whiting, Indiana refinery, compounded by Iran-related crude tension (Source: ABC7 Chicago/WLS-TV). This is a transient supply shock, not a structural energy thesis change, but it creates a near-term tailwind for refiners and a headwind for consumer discretionary if it persists into summer driving season.

Tertiary signals worth monitoring: a Business Insider piece on bifurcating consumer outcomes (lower earners stalling, upper earners pulling ahead) — relevant for our retail/restaurant exposure (CAVA, COST). Ford CEO Jim Farley's comments on affordability focus (Source: CBS News) are a soft confirmation that auto OEMs see consumer pressure at the lower end — directly relevant to TSLA thesis. The Clarity Act language on stablecoin rewards (Source: CoinDesk) is a marginal positive for HOOD and MELI's crypto/fintech surface area. Berkshire's Q1 disclosure that it continued selling stocks and stacking cash in the first quarter without Buffett at the helm (Source: Berkshire 13-F commentary referenced in earnings coverage) is consistent with our BRK-B thesis — Abel is preserving optionality, not chasing the tape.

MSFT (8/10, RECOMMEND) — No fundamental change. Citi turned more positive ahead of fiscal Q3 (Source: news feed). Analyst sentiment input only — not a thesis driver. Thesis intact: Azure + M365 Copilot monetization remains the core long-duration call. No conviction change.

NVDA (8/10, RECOMMEND) — Down 8.4% on the week against a still-solid 1M (+11.9%). Headlines show BAC reaffirming Buy and standard buyback chatter (Source: news feed). Nothing structural changed in the AI infrastructure thesis. Pullback is consistent with mega-cap tech digestion noted in Barchart commentary on mixed mega-cap earnings. No conviction change — this is the kind of price volatility the mandate explicitly says to ignore absent fundamental change.

MELI (7/10, RECOMMEND) — Stablecoins overtaking Bitcoin in LatAm crypto purchases (Source: Bitso/CoinDesk) is a marginal positive. MELI's Mercado Pago is the largest fintech distribution channel in the region, and stablecoin rails accelerate cross-border payments velocity. Watching for explicit MELI commentary on stablecoin integration in the next earnings call. No conviction change.

LLY (7/10, MONITORING) — +10.95% on the week. GLP-1 sales continue to drive results (Source: Investor's Business Daily headline) and Confo Therapeutics announced a Lilly-initiated Phase 2 for CFTX-1554 in peripheral pain (Source: Confo press release referenced in news feed). Pipeline diversification beyond GLP-1 is exactly what the bull case requires. Considering upgrade to RECOMMEND pending a closer read of the Phase 2 design and non-GLP-1 revenue trajectory. Will not act this morning — need primary source review.

FSLR (7/10, MONITORING; also 10-share holding at 7/10 HOLD) — +7.21% week, +8.39% month. Q1 2026 earnings transcript released (Source: Seeking Alpha headline). Need to read the full transcript before any conviction move — flagging as homework. Headlines also reference profitability among renewable peers, which is consistent with the cost-leadership thesis.

BRK-B (7/10, MONITORING) — Annual meeting coverage notes Abel's first meeting as CEO with shares underperforming. This is noise, not signal. Berkshire's continued cash stacking (Source: Q1 13-F) is precisely what the structural thesis priced in. No conviction change.

ADBE (7/10, MONITORING) — News feed returned only "Unauthorized Remote Access" headlines — appears to be unrelated keyword matches, not company-specific. No data; no thesis change.

HOOD (6/10, MONITORING) — -12.26% on the week. Clarity Act allowing crypto firms to offer stablecoin rewards (Source: CoinDesk) is structurally favorable. Need to investigate whether the weekly drawdown reflects an idiosyncratic event (earnings? regulatory?) or just beta. Flagging for primary-source review.

MEDP (5/10, MONITORING) — Multiple class action filings disclosed (Source: Schall Law Firm, Bronstein Gewirtz). Securities fraud lawsuits at this stage are a yellow flag — most settle for nuisance value, but require monitoring. Bares Capital trimming stake (Source: 13-F commentary headline) is a more meaningful sentiment input given Bares' concentrated approach. Reducing to 4/10 conviction internally; will not promote to coverage until lawsuit specifics are clarified.

RYAN (6/10, MONITORING) — -11.26% on the week. No company-specific news in feed (headlines were unrelated keyword matches). The drawdown without an obvious catalyst warrants investigation. Flagging for next-week deep dive.

SPSC (6/10, MONITORING) — Q1 2026 results released (Source: SPS Commerce IR). +7.36% on the week suggests results were received positively. Need to read the actual print and call transcript before a conviction move.

CSGP (6/10, MONITORING) — Bares Capital bullish (Source: 13-F commentary); also held by Akre Focus and Polen Global Growth (Source: Q1 2026 commentaries). When three high-quality managers are independently constructive, that's a meaningful sentiment crosscheck — but not a primary thesis input. No change.

All other monitoring positions: no material thesis-relevant news today.

No new names entering coverage today. Pipeline already at 30+ monitoring positions, which is well above the comfortable diligence load. Per HARD RULE #6, high-conviction roster is capped at 10–12 — currently sitting at 4 RECOMMEND (MSFT, NVDA, MELI, BRK-B uplift candidate) plus portfolio holdings. The right move today is to deepen existing analyses rather than add breadth.

Specific homework items from today's news flow:

• Spirit Airlines liquidation creates a research opportunity in legacy carriers (DAL, UAL, LUV) — adding to screening list, not yet watchlist.
• BWXT (already monitored) and CEG (already monitored) — refinery outages and Iran tension reinforce the energy security/nuclear thesis. No action, but increasingly comfortable with the structural setup.

Macro:

• HY credit spreads at 283 bps are benign today — but watch for widening if the BP Whiting outage and Iran tensions extend energy price spikes into Q3. Energy-driven inflation reacceleration is the cleanest path to a renewed Fed hawkish pivot, which would compress the multiple on long-duration tech.
• Unemployment at 4.3% is at the upper end of "healthy." Any tick to 4.5%+ in the next NFP print would shift the macro narrative from "soft landing" to "slowdown" and force a re-underwriting of consumer-exposed names (CAVA, COST, HIMS).

Thesis-specific:

• MEDP: Securities fraud class action — monitoring for substance vs. nuisance. If consolidated complaint alleges revenue recognition or backlog quality issues, conviction goes to 3/10 immediately.
• TSLA (portfolio holding, 5/10 TRIM): Ford's affordability pivot (Source: CBS News) is corroborating evidence that the mid-market EV consumer is price-sensitive in ways the Tesla bull case under-weighted. Reaffirming TRIM.
• HIMS (portfolio holding, 5/10 TRIM): -39% from cost basis. Reaffirming TRIM stance — the GLP-1 compounding window is closing as branded supply normalizes.
• PLTR (portfolio holding, 6/10 HOLD): -18.6%. No new news today. Watching for next earnings to validate commercial AIP traction.
• ISRG (portfolio holding, 8/10 HOLD): -20.8%. Drawdown is concerning but no fundamental change. Reaffirming HOLD per HARD RULE #7 — price volatility is not a reason to abandon a thesis.

Data integrity:

• 10Y Treasury and CPI YoY did not refresh in this morning's FRED pull. Flagging — will reconcile against the next data release.