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GameStop shares soar as ‘Roaring Kitty’ reveals $116m bet in Reddit post 2024-06-03 16:19:00+00:00 - GameStop shares rose sharply on Monday after “Roaring Kitty” Keith Gill, the man at the heart of a 2021 stock market frenzy around the struggling video gaming chain, returned to Reddit with a post which appeared to show a $116m bet on the chain. The stock soared by as much as 74%, before losing ground in volatile trading. By mid-morning, it was up by 31%. Hours before Wall Street had officially opened for the day, roughly $390m worth of GameStop shares had changed hands by 5:53am ET. It was the first post in three years from Gill’s Reddit account, where screenshots of his bullish GameStop trades had in 2021 triggered a rush of demand for “meme stocks” – often companies with weak fundamentals that gained a cult-like following through social media hype. The screenshot posted on Sunday showed a GameStop holding of 5m, or 1.8% of its publicly available stock. It also showed $65.7m worth of GameStop call options, typically bought to express a bullish view, expiring on 21 June at a strike price of $20. The screenshot has not been independently verified, and Gill has yet to comment beyond social media. Shares in GameStop also surged last month, when he resurfaced on X, formerly Twitter, with a string of cryptic posts. “Keith Gill is putting his money where his tweets are, and some investors are clearly following his lead and rekindling interest in meme stocks,” said Ben Laidler, global markets strategist at the digital brokerage eToro. Shares in GameStop have fallen dramatically since their extraordinary peak in early 2021, at the height of the so-called “meme stock” trading frenzy, when a string of companies were boosted by viral memes. Questions have been raised, too, about the strength of GameStop’s business, which has endured a series of high-profile departures from its management team. In March, the chain cut an unspecified number of jobs to reduce costs and reported lower fourth-quarter revenue. GameStop was trending No 1 on investor-focused social media platform stockstwits.com, indicating increased chatter among individual traders, while fellow meme stock AMC climbed by 13%. skip past newsletter promotion Sign up to Business Today Free daily newsletter Get set for the working day – we'll point you to all the business news and analysis you need every morning Enter your email address Sign up Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy . We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply. after newsletter promotion Monday’s surge also put GameStop short sellers on track to rack up nearly $1bn in paper losses, according to the data and analytics firm Ortex Technologies. Gill’s last post from April 2021, titled “final update”, showed a holding of 200,000 GameStop shares worth $30.9m. Reuters contributed reporting
Feeling Consumers’ Pain, Retailers Bring Back Discounts 2024-06-03 16:00:22+00:00 - U.S. consumers, fatigued by a three-year bout of inflation, want lower prices. And large retailers that have increased prices, partly to contend with their own rising costs, appear to be responding to customer concerns — to an extent. Walgreens said last week that it was lowering prices on over 1,000 items. Target recently announced modest price cuts on 5,000 food products and household goods. Craft and furniture stores like Michael’s and Ikea have also said they will drop prices on popular items. A broader range of companies have indicated on quarterly earnings calls that they plan to slow price increases and seek other ways to expand profitability. Signaling empathy with customers facing higher living costs is an increasingly important marketing strategy, retail analysts say. But regardless of motivation, a shift is in motion that may help ease inflation in the coming months.
Car Deals Vanished During the Pandemic. They’re Coming Back. 2024-06-03 16:00:13+00:00 - For much of the last four years, automakers and their dealers had so few cars to sell — and demand was so strong — that they could command high prices. Those days are over, and hefty discounts are starting a comeback. During the coronavirus pandemic, auto production was slowed first by factory closings and then by a global shortage of computer chips and other parts that lasted for years. With few vehicles in showrooms, automakers and dealers were able to scrap most sales incentives, leaving consumers to pay full price. Some dealers added thousands of dollars to the manufacturer’s suggested retail price, and people started buying and flipping in-demand cars for a profit. But with chip supplies back to healthy levels, auto production has rebounded and dealer inventories are growing. At the same time, higher interest rates have dampened demand for vehicles. As a result, many automakers are scrambling to keep sales rolling.
Electric Cars Are Suddenly Becoming Affordable 2024-06-03 16:00:12+00:00 - Alex Lawrence, a dealer in Salt Lake City who specializes in used electric cars, has seen a change over the last year in the kinds of customers who are coming into his showroom. They used to be well-heeled professionals who could drop $70,000 on a Rivian luxury pickup truck. Recently, Mr. Lawrence said, customers have been snapping up used Teslas for a little over $20,000, after applying a $4,000 federal tax credit. “We’re seeing younger people,” Mr. Lawrence said. “We are seeing more blue-collar and entry-level white-collar people. The purchase price of the car has suddenly become in reach.” Regarded by conservative politicians and other critics as playthings of the liberal elite, electric vehicles are fast becoming more accessible. Prices are falling because of increased competition, lower raw-material costs and more efficient manufacturing. Federal tax credits of up to $7,500 for new electric cars, often augmented by thousands of dollars in state incentives, push prices even lower.
Washington Post Newsroom Reels From Sudden Editor Exit 2024-06-03 15:51:39+00:00 - On Sunday night, minutes after Will Lewis, the chief executive of The Washington Post, informed employees that the newspaper’s executive editor, Sally Buzbee, was being replaced, managers gathered on a conference call to hear from their boss one last time. Ms. Buzbee told them that a new organizational structure created by Mr. Lewis — effectively splitting the Washington Post newsroom and opinion section into three smaller divisions — didn’t work for her. She added that Mr. Lewis was pushing for aggressive moves to turn around The Post, and asked editors to reserve judgment for now. “I would have preferred to stay to help us get through this period, but it just got to the point where it wasn’t possible,” Ms. Buzbee said, according to a person familiar with the matter. The stunning call — which some attendees described as funereal — added to the growing tension between the newsroom and Mr. Lewis, who has set about remaking The Post since he started in January.
Why Smartsheet Stock is an Undervalued Gem: Investment Insights 2024-06-03 15:23:00+00:00 - Key Points Smartsheet is like Excel but with a few added features that allow it to grow revenue and accounts by double digits. It still fits the artificial intelligence story but with realistic growth expectations, as analysts see only 26.4% EPS growth. Markets are willing to pay a premium for the stock, and there are good reasons. 5 stocks we like better than Smartsheet While Excel gives Microsoft Co. NASDAQ: MSFT the dominating position in data analysis and visualization software, as it is globally accepted through education and corporations, it is far from perfect. Regarding project management, platforms like Smartsheet Inc. NYSE: SMAR take the lead but aren’t as widely followed as other peers like Salesforce Inc. NYSE: CRM. Being under the radar may be a bummer for impatient investors. Still, it can also be a blessing in disguise to avoid some of the negative spotlight. Salesforce stock recently fell to a once-in-a-generation price after its quarterly earnings results, which weren’t wrong. Still, because all eyeballs fell on the stock, any figure missing expectations becomes an amplified event very quickly. Get Smartsheet alerts: Sign Up Today, investors can peg Smartsheet against other under-the-radar peers like Box Inc. NYSE: BOX and find out why the market is willing to place a premium valuation on Smartsheet, making its current price a level to start watching into the next quarter. Before details are discussed, though, here’s how Smartsheet fits into the technology sector. Smartsheet’s Strategic Investment in Automation and Cloud Smartsheet Today SMAR Smartsheet $37.42 +0.42 (+1.14%) 52-Week Range $35.52 ▼ $52.81 Price Target $49.75 Add to Watchlist The world of artificial intelligence may start looking like the 2000s dot-com bubble, where stocks like Cisco Systems Inc. NASDAQ: CSCO made all-time highs that haven’t been able to return to nearly three decades later. This is why investors need to stay with companies that are already making a path into A.I. without unrealistic assumptions. Smartsheet is heavily invested in automation and keeping project management in the ‘cloud,’ an area well-versed in today’s A.I. capabilities. Keeping assumptions realistic for Smartsheet, unlike a company that could promise to cure cancer through A.I. (possible, but not very likely), here are the projections investors can lean on. Here’s what drove the Vanguard Group to invest up to $649.6 million into Smartsheet as of March 2024. Professionals tend to get into stocks they believe are cheap today relative to how much profit growth they can deliver in the future. Therefore, analyst earnings per share (EPS) 26.4% growth projections for Smartsheet can be taken seriously. Smartsheet Inc (SMAR) Price Chart for Monday, June, 3, 2024 Smartsheet’s Forward P/E Ratio and Market Sentiment Even though Smartsheet trades at only 70% of its 52-week high, trends in the mid-cap technology sector show a similar behavior. Taken as a whole, the mid-cap software as a service (SAAS) industry trades at an average of 67.5% of its 52-week high, so there’s nothing specific about Smartsheet that could have led to this bearish price action. In fact, markets believe it could be an outlier in the pack. Using the forward P/E ratio, investors can gauge how the market feels about Smartsheet’s future earnings, and ideally, markets are willing to pay a premium for this stock over its peers. A 26.6x forward P/E commands a premium of 76.8% over Box’s 15.1x valuation, but that’s not all. Smartsheet still calls for a 62.4% premium over the 16.4x average forward P/E multiple today compared to the rest of the software industry. A price-to-book (P/B) ratio of 8.3x also stands 27.6% above the computer industry’s 6.5x average P/B, showing that markets like Smartsheet’s balance sheet a lot more than peers, which, of course, can be accredited to the mere 7.6% debt as total capital in the company’s balance sheet. Young technology stocks tend to have much higher debt levels, so Smartsheet’s high debt level is a refreshing sign of stability, justifying its premium valuations. Wall Street analysts recently lowered their price targets for Smartsheet, but they still see it going as high as $49.7 a share, calling for up to 34.5% upside from where it trades today. Strong Financial Performance: Smartsheet’s 21% Revenue Growth Despite recently reaching $1 billion in annualized recurring revenue, not everything is rainbows and butterflies for Smartsheet. This software's main advantage over Excel is its ability to communicate in real-time with other team members working on the same project. However, as cool as this feature may be, Microsoft has all the resources to duplicate and improve Smartsheet’s golden ticket to the profit factory. Now, as timing in the A.I. race is of the essence, that could prove to be an opportunity. Risky nonetheless, but still an opportunity. If Microsoft weighs out how long it would take to improve Smartsheet’s product offer and finds that it would be better to buy out the company instead, it could prove to be a very lucrative – albeit hypothetical – event for Smartsheet shareholders. Returning to reality, more and more customers look to Smartsheet as their solution to project management. As the fiscal year 2024 results show, revenue grew 21% over the year, and operating cash flow more than tripled to reach $157.8 million, bringing Smartsheet awfully close to total profitability. Before you consider Smartsheet, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Smartsheet wasn't on the list. While Smartsheet currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here
The Most Upgraded Stocks After the Q1 Earnings Season 2024-06-03 15:20:00+00:00 - Key Points These are the most upgraded stocks as tracked by Marketbeat at the end of the Q1 earnings reporting cycle. NVIDIA regains the top spot after another record-setting quarter and guidance that may be cautious. Google and Dick's Sporting Goods make noticeable movement up the ranks to take the #2 and #3 positions. 5 stocks we like better than NVIDIA The Q1 earnings reporting season is all but finished, with more than 98% of the reports issued. While the season unfolded largely as expected, the individual reports brought some unexpected strengths. These strengths are reflected in the analysts' activity. This is a look at the three Most Upgraded Stocks tracked by Marketbeat, where the analysts see them heading over the next few quarters, and why. Get NVIDIA alerts: Sign Up NVIDIA Regains Leadership Position NVIDIA Today NVDA NVIDIA $1,150.00 +53.67 (+4.90%) 52-Week Range $373.56 ▼ $1,158.19 Dividend Yield 0.01% P/E Ratio 67.25 Price Target $1,123.49 Add to Watchlist NVIDIA NASDAQ: NVDA, a Most Upgraded Stock since early 2023, moved up several positions this quarter to regain the top spot. The company produced another record-setting quarter, outperforming estimates and raising guidance. The spectacular details include a 260% revenue gain, 500 basis points of outperformance, and 500 basis points stronger than expected guidance. The guidance may be cautious because the company is still experiencing an upswing in demand. The result is that NVIDIA stock received 49 upgrades and positive revisions in the last 90 days, most since the Q1 results were released, and they are leading the market to a new high. The consensus price target tracked by Marketbeat has the stock fairly valued near its current levels, but there are two factors to consider. The first is that the consensus target has risen 19% since last year; the second is that recent revisions have led to a high-end range of nearly $1200 to $1400. That’s a 10% to 30% increase from current levels, and revisions are likely to continue because NVIDIA is the leader in AI and already has a clear upgrade cycle in place. The market is scrambling to get as many H100s as possible; the Blackwell series will be in demand next year, and then Rubin in 2026. Alphabet Gains Ground: Becomes the 2nd Most-Upgraded Stock Alphabet Today GOOGL Alphabet $173.17 +0.67 (+0.39%) 52-Week Range $115.35 ▼ $178.77 P/E Ratio 26.56 Price Target $191.57 Add to Watchlist Google parent Alphabet NASDAQ: GOOGL was lurking lower in the ranks at the end of calendar Q1 but has shot up the ranks following the Q1 earnings reporting season. Now in 2nd position, Google received 35 upgrades and positive price target revisions, leading the market higher. The current consensus of $191 is more than 10% above the price action and up 46% compared to last year. Much of the increase is due to the post-release activity, which increased the consensus price target by 26% and points to the high end of the range. The high target was set recently at $225 or another 2000 basis points above consensus. Details driving the analysts' upgrade cycle include results. The company easily outpaced the consensus forecasts in Q1 on strength in all segments led by search, YouTube, and the cloud. Guidance was also increased and suggests Google’s position is secure. Demand for AI infrastructure and services is robust, and the roll-out of the Gemini chatbot is progressing smoothly. Dick’s Investors Win Big in Q1: Analysts Raise Targets DICK'S Sporting Goods Today DKS DICK'S Sporting Goods $222.35 -5.29 (-2.32%) 52-Week Range $100.98 ▼ $229.56 Dividend Yield 1.98% P/E Ratio 18.41 Price Target $237.09 Add to Watchlist Dick’s Sporting Goods NYSE: DKS stock price resumed rally mode last year as analysts began to lift sentiment. The rally was reinvigorated following the Q1 results, which sparked another series of positive revisions. Details from the report include top and bottom strength, accelerating comp store sales, market share gains, wider margins, and improved guidance. The executive raised the guidance because of the results above the high-end of the prior range and the analysts' consensus forecasts. Dick’s stock received 34 upward revisions in the last 90 days, putting it in the 3rd position on the Most Upgraded Stocks list, with an improvement of nine positions in less than 30 days. Nearly half of the revisions were issued after the Q1 release, including one upgrade and 16 increased price targets. The consensus rose by $30 or more than 1000 basis points because of the increases. Consensus assumes a 4% upside from $225, but the fresh targets put this stock in the high-end range near $260, a new all-time high worth a 15% upside. Before you consider NVIDIA, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and NVIDIA wasn't on the list. While NVIDIA currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here
What Is Risk Tolerance & Why Is It Important? 2024-06-03 14:30:00+00:00 - What Is Risk Tolerance & Why Is It Important? Key Points Risk tolerance is a way of describing how investors endure losses or volatility in the market. Factors like age, goals, personality and emotional responses influence low or high risk tolerance. Risk tolerance differs from risk capacity, which uses more objective factors in its criteria. Have you ever had the urge to ride the tallest rollercoaster in the park? If so, then you may have a high tolerance for risk. While riding the highest rollercoaster might not seem like a risky endeavor, it still comes with a level of anxiousness you won’t find on the kiddie rides. Figuring out your investment risk tolerance is like figuring out how high a rollercoaster you’re comfortable riding. Some investors can tolerate massive peaks and valleys of volatility, while others prefer the market equivalent of the Merry-Go-Round. Risk tolerance is crucial because it helps develop a thorough financial strategy and prevents irrational decision-making. Get earnings alerts: Sign Up The Difference Between Risk Tolerance and Risk Capacity Tolerance and capacity are related ideas, but they describe 2 different types of responses to risk. Both need to be considered in a financial plan, so it's important to understand the nuance between the 2 concepts. Risk tolerance measures our comfort level when putting money into markets. How does a loss make you feel? If you’re an emotional investor, you might have a low-risk tolerance since losing money could induce poor decisions. Conversely, your risk tolerance might be high if you have a calm hand during market volatility since significant losses won’t send you running for the exits. Risk capacity measures how much capital an investor can realistically put into assets like stocks. It's not your personality at play here but your financial situation: your income, career, debt obligations and family. A single investor with a promising career has a higher capacity for risk than one with a family or a career in transition. An investor with a low-risk capacity may still have a high-risk tolerance. For example, if you fear layoffs are coming at your company, you might cut back on investing and focus on savings, even if your heart rate is usually unaffected by losses. How to Assess Your Risk Tolerance What factors go into a risk tolerance assessment? Risk tolerance is a matter of personal preference. Investors with similar timelines and capital may still have wildly different views on risk depending on their personalities or life circumstances. Figuring out your risk tolerance requires some self-testing, so ask yourself the following questions: What are my objectives and timeline as an investor? If you’re saving for a retirement that’s still decades away, you’ll probably view risk differently than someone with a family saving for a house down payment. What is my current income status? If you’re a high earner and max out all your tax-deferred retirement vehicles, you probably have more capital for higher-risk investments than someone who just contributes to a 401(k). What is my life and family situation? As we get older, life tends to force risk tolerance adjustments. A wedding, vacation, children and the future education of those children are all significant emotional and financial events that require a personal risk re-evaluation. MarketBeat has plenty of tools to help you start your personal risk assessment. But remember, it's crucial to be honest with yourself. Be realistic about your goals and mindset, and always consult an advisor before making big decisions. How Risk Tolerance Influences Investment Choices Risk tolerance looms large over the makeup of our portfolios. Investors with little appetite for risk have a portfolio composition that is much different from those who can stomach wild stock market volatility. Here are 3 basic risk tolerance examples: Low-Risk Tolerance Investment Strategies Investors with a conservative risk tolerance are more interested in wealth preservation than profit accumulation. Low-risk tolerance strategies are often used by retirees or older investors who prefer consistency to outperformance. A portfolio of low-risk assets can include government or corporate bonds, dividend-paying stocks or funds in low-volatility sectors like utilities, annuities, money-market funds or FDIC-insured instruments like certificates of deposit (CDs) or high-yield savings. For most conservative investors, the key is to minimize volatility while producing steady (if unspectacular) income. Medium-Risk Tolerance Investment Strategies Investors can find a middle ground between high- and low-risk strategies by dividing their capital between income-producing assets and higher-volatility investments. Medium-risk tolerance investors often split their assets into two buckets: one for short-term needs and one for long-term needs. The short-term portfolio would consist of CDs, bonds or dividend-paying stocks, while the long-term portfolio is filled with growth assets like tech and consumer discretionary stocks. The classic 60/40 stock-bond portfolio is an excellent example of a mid-range risk strategy. Investors still have more capital in stocks than bonds, which limits the upside during bull market runs. However, during market drawdowns, the bond portion should act as a buoy, keeping the portfolio afloat until the turbulence subsides. High-Risk Tolerance Investment Strategies Investors with high-risk tolerances typically devote most of their portfolios to stocks or derivative instruments. Volatility isn’t a bother for someone with a high risk tolerance since they often have the timeline or capital capacity to withstand drawdowns, economic trouble or earnings misses. If 60/40 is the model portfolio for medium risk tolerance, a high-risk investor will have 90% (or more) of their money in stocks. High-risk investing doesn’t mean reckless, however. On a long timeline, stocks tend to beat other asset classes. Since 1971, average annual returns from the S&P 500 are estimated to be between 7% and 10%, depending on whether you reinvest dividends. If your timeline measures in decades, allowing risky stocks to compound can produce a substantial nest egg - just make sure you have the emotional strength to withstand bear markets. Adjusting Risk Tolerance Over Time Risk tolerance isn’t something you set and forget like your morning alarm clock. It morphs and evolves as your life reaches different stages. When you start your career, you have time and future earnings on your side. But as retirement approaches, timelines compress, and your expected future income can no longer be a buffer to market volatility. Retirement is just one of many life changes that force a risk tolerance adjustment. Perhaps you marry a spouse with a lower risk appetite or pivot to a new job with a different salary. As life changes, so will your risk tolerance. Consider reviewing your investment plans every so often to ensure your risk tolerance still matches your goals and position in life. Keep Learning with MarketBeat Risk tolerance can be complicated since every investor has different objectives and timeframes. MarketBeat has risk tolerance assessment tools to help you start your journey. Click here to learn more about our products and offerings. Before you make your next trade, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. Our team has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and none of the big name stocks were on the list. They believe these five stocks are the five best companies for investors to buy now... See The Five Stocks Here
Ex-BA boss: drop green aviation policies if costs outweigh benefits 2024-06-03 14:30:00+00:00 - Green aviation policies should be abandoned if the costs outweigh the benefits, the head of the world’s most influential airlines body has said. Willie Walsh, the director general of the International Air Transport Association (Iata) and a former British Airways boss, said achieving net zero by 2050 was “existential, not optional”. However, he also suggested governments should have the courage to stop green policies and change tack if they were not producing the intended results. The comments came as part of Walsh’s keynote speech at Iata’s annual general meeting in Dubai on Monday, in which the body revealed that the global aviation sector would achieve a net profit of more than $30bn (£24bn) this year, up by $3bn on last year’s figure. Part of Walsh’s speech focused on current approaches to decarbonise the aviation sector and tackle the climate crisis, in which he hit out against green levies on the sector. He said more taxes were not the solution to achieving net zero and that the current “parade of fragmented green tax proposals” were prohibiting people from flying sustainably and grounding all but the rich. Walsh put forward eight approaches that he argued would improve the world’s progress towards greener aviation, which included a call for provisions to be put in place that would allow certain green policies to be reviewed and scrapped if they did not work. “Measures must have provisions for review and abandonment if they are not producing the intended results,” he said. “Some good ideas will certainly translate into good policies. And many may not. “When a policy has clearly failed – especially when costs outweigh benefits – regulators must have the courage to stop, and change tack fast.” Walsh said the global industry needed global solutions and Iata would be pushing for globally recognised and accepted rules to reduce carbon emissions, while also calling for measures be put in place to direct more fossil fuel investment into sustainable aviation fuels (SAFs). A number of countries are bringing in SAF mandates, which put requirements on providers to use a certain percentage of the fuel in their aircraft. SAFs can be sourced from food-waste oil and fats, green and municipal waste and non-food crops, and it is claimed they could cut emissions by 80% compared with traditional fuels. However, critics say hopes for the technology are overblown, with a report by the Institute for Policy Studies thinktank arguing efforts to bring SAFs up to scale are too far off track to avert the climate crisis. skip past newsletter promotion Sign up to Business Today Free daily newsletter Get set for the working day – we'll point you to all the business news and analysis you need every morning Enter your email address Sign up Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy . We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply. after newsletter promotion The UK is poised to pass its own SAF mandate in January next year, which will put in place laws that require 2% of all jet fuel used by airlines to come from sustainable and low-carbon sources by the end of 2025, and 10% by 2030. SAF now equates to just more than 0.5% of the globe’s fuel needs. Walsh said these mandates faced a number of problems, with governments sometimes mandating airlines to buy SAF in quantities that did not exist. He said this often resulted in producers being hit with fines and passing them on to airlines. “We witnessed this in France where fuel suppliers are happy to accept penalties for their failure to supply the SAF mandate. They simply exercise their monopoly power and pass those costs on [to] airlines. This must be stopped,” he said. Iata revealed that airlines would probably reach profits of $30.5bn in 2024, up from the $27.4bn that are estimated for 2023. This was also up on the $25.7bn forecast for 2024 in December this year. It also forecast record revenues of $1tn for the sector but this would be partly offset by record expenses of $946bn.
DocuSign: Can AI Move the Needle in Fiscal 2025? 2024-06-03 14:22:00+00:00 - Key Points DocuSign is a pioneer in implementing electronic signatures for agreements and contracts. DocuSign has parlayed its signature business into contract lifecycle management, document generation, identity management, analytics and reporting businesses optimized with AI integration. DocuSign acquired Lexion to bolster its AI product portfolio. 5 stocks we like better than DocuSign DocuSign Inc. NASDAQ: DOCU provides electronic signature and contract lifecycle management (LCM) services. Shares hit highs of $314.70 in 2021 as business surged from the pandemic as businesses and individuals adopted remote meetings and contract signings. Shares have since collapsed as workers returned to the office and COVID was in the rearview mirror. DocuSign announced the acquisition of Lexion, an artificial intelligence (AI) powered intelligent document management platform, for $165 million in cash. DocuSign Today DOCU DocuSign $53.44 -1.30 (-2.37%) 52-Week Range $38.11 ▼ $64.76 P/E Ratio 148.45 Price Target $60.25 Add to Watchlist DocuSign is in the computer and technology sector and competes with other electronic signature providers such as Adobe Inc. NASDAQ: ADBE, Oracle Co. NYSE: ORCL and Dropbox Inc. NASDAQ: DBX. Get DocuSign alerts: Sign Up DocuSign's Artificial Intelligence (AI) Implementation DocuSign has been implementing AI features into its software. Smart document recognition (SDR) enables the platform to extract key data from documents to help streamline workflows automatically. AI also enables automated form pre-filling, helping minimize errors. DocuSign may implement more features that help personalize the user experience based on previously identified preferences and behavior. The acquisition of Lexion is expected to bolster its AI offerings and intelligent document management (IDM) capabilities. Expanding Beyond E-Signatures: DocuSign's New Features DocuSign has parlayed its e-signature business into contract lifecycle management (CLM), enabling users to prepare, manage, track and save agreements and contacts electronically. This improves workflows and keeps things organized and accessible. Identity verification is integrated into the platform to ensure the authenticity of signers and prevent fraud, which adds an extra value-added layer of security and trust. Payment processing tools have been integrated into the platform and document generation with customizable templates, analytics and reporting capabilities so users can identify trends, track completion rates, and gain useful insights into agreement processes. DOCU Stock Has Been Held in a Daily Rectangle Channel Pattern The daily candlestick chart on DOCU has been in a rectangle channel since mid-April 2024. The rectangle range is comprised of the $61.14 upper trendline resistance and the $54.74 lower trendline support. The upcoming fiscal Q1 2024 earnings report may be the catalyst to break it out of the rectangle. The daily relative strength index (RSI) has been falling to the 37-band. Pullback support levels are at $52.90, $49.12, $46.66 and $44.34. A Solid Fiscal Q4 2024 Earnings Report for DocuSign On March 7, 2024, DocuSign reported fiscal Q4 2024 EPS of 76 cents, beating consensus analyst estimates by 11 cents. Revenues grew 8% YoY to $712.39 million, beating $698.32 million consensus estimates. Billings rose 13% YoY to $833.1 million. Non-GAAP margin rose 100 bps to 25%, hitting the high end of estimates. Restructuring led to another round of layoffs preceding the report. Revenues cooled compared to a 9% YoY growth in Q3, 11% YoY in Q2, and 12% in Q1 2024. Customer usage rose, and key verticals, including insurance, technology, financial services and healthcare, saw a boost. DocuSign's Raised Guidance DocuSign raised forecasts, which give the impression that the company is starting a recovery. For fiscal Q1 2024, DocuSign sees revenues in the $704 million to $708 million range versus $700.54 million consensus estimates. Billings are expected between $685 million and $695 million. Non-GAAP operating margins are expected between 27% and 28%. Fiscal full-year 2025 revenues are expected to be between $2.915 billion to $2.927 billion versus $2.91 billion consensus estimates. Full year billings are expected between $2.970 billion to $2.90 billion. Non-GAAP operating margins are expected between 26.5% to 28%. DocuSign CEO Allen Thygesen commented, “The opportunity in front of DocuSign remains massive. Today's world runs on agreements, but agreement processes haven't changed in the last 100 years. Even with the evolution to digital documents, agreements and how we use their insights remain relics of antiquated paper-based systems. Sign a document stored as a flat file preserved but disconnected from the systems that run your operations.” Thygesen summarized: “Our sole focus is transforming those systems for our 1.5 million existing customers to make agreements more valuable for enterprises and SMBs alike.” Revenue Expectations for DocuSign in Fiscal Q1 2025 The consensus analyst estimate for fiscal Q1 2025 is EPS of 79 cents, up from 72 cents. Consensus revenue expectations are for $707.33 million. DocuSign reports its fiscal Q1 2025 earnings on June 6, 2024, after the market close. The results will determine if DOCU stock can break out or break down from the rectangle channel pattern. DocuSign analyst ratings and price targets are on MarketBeat. Before you consider DocuSign, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and DocuSign wasn't on the list. While DocuSign currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here
3 Stocks with Fast Upside Potential Due to High Short Interest 2024-06-03 14:15:00+00:00 - Key Points Short interest has risen recently for these three stocks, giving them a high probability of breaking out to new highs. Backed by the fundamental thesis around their businesses, analysts have stepped up to back their potential rallies. Monitor what investors need for their portfolios in today's economy. 5 stocks we like better than Sprouts Farmers Market Whenever stocks reach a higher than usual short interest, investors could benefit from keeping a close eye on the future prospects for those stocks. Typically, there is a good reason for short sellers to take on a bearish view of businesses. However, like bullish sentiment, bearish sentiment can get out of hand. A saga like GameStop Corp. NYSE: GME could happen if short interest becomes too high. GameStop’s short interest reached $7 billion in 2021, so a single tweet from “RoaringKitty” was enough to send the stock to its all-time high. While these stocks aren’t as heavily shorted as GameStop once was, short interest is still high enough to potentially send them higher soon. Get Sprouts Farmers Market alerts: Sign Up Recently, the high short interest in SoFi Technologies Inc. NASDAQ: SOFI, Sprouts Farmers Market Inc. NASDAQ: SFM, and even Williams-Sonoma Inc. NYSE: WSM has seen its short interest rise to unusual levels. While there is always a reason to sell, these stocks outweigh it with more reasons to buy instead. What High Short Interest Means When someone sells a stock short, that investor must borrow a stock they don’t own and then sell it to the market. If the stock declines, that person can buy back the stock at a lower price than what it was borrowed for – that’s where the profit comes in -. When short interest is high, most of the outstanding shares in the market are held in short positions, which means they need to be repurchased to be closed. So, if a stock rises relatively quickly, the high short seller population could hit max pain and look to close out their losers (buy the stock). If this behavior is triggered on a large scale, massive buying activity could create a compound effect that causes the stock to rally to new highs, as happened to GameStop and AMC Entertainment Holdings Inc. NYSE: AMC in 2021. With that understanding, investors can see why these three stocks could soon trigger mass buying due to their high short interest. Mortgage Bounce Backs Could Send SoFi Higher SoFi Technologies Today SOFI SoFi Technologies $6.77 -0.13 (-1.88%) 52-Week Range $6.41 ▼ $11.70 Price Target $9.08 Add to Watchlist The real estate sector is currently in stalemate, as 7.3% mortgage rates and average home prices that are 32% higher than pre-pandemic levels keep would-be buyers from entering the market. According to the Intercontinental Exchange, most outstanding mortgages in the U.S. carry an average interest rate of 3.25% today, so homeowners aren’t looking to sell their cheap mortgages. Now that the Federal Reserve (the Fed) is proposing interest rate cuts as soon as September 2024, according to the CME’s FedWatch tool, lower mortgage rates could also spark new demand for those looking to finance a new home. Carrying an 18.2% short interest today, bears stand against earnings per share (EPS) growth projections for 200% this year set by analysts. Because SoFi stock trades at only 59% of its 52-week high, chances are high that a positive quarter – or any easing housing news – could send the stock higher to catch up. How high? Analysts at Jefferies Financial Group think SoFi stock could reach $12, daring it to rally 73.9% from its current price. Price Initiatives Lined Up Sprouts Farmers Market For a Rally Sprouts Farmers Market Today SFM Sprouts Farmers Market $78.85 -0.13 (-0.16%) 52-Week Range $32.17 ▼ $82.96 P/E Ratio 27.19 Price Target $57.25 Add to Watchlist Peers like Target Co. NYSE: TGT, Aldi (privately owned), and others have led the way in price cuts on thousands of items. This is a rare occurrence, as once prices are set on the rise, they do not often come back down to pre-inflation levels. Sprouts have yet to announce its own round of price cuts. Recent quarterly earnings sent the stock rallying by nearly 30% since the announcement, a price action that could set up the company to price in better guidance for the rest of 2024 if these price cuts are announced. While no analysts have felt the need to stick their necks out on this stock, current price targets could see an adjustment to the upside if and when these price announcements are set, which is where investors could see a path to higher stock prices. While not as clear of a play as SoFi, Sprouts’ 11.9% short interest (as a percentage of total shares) could prove dangerous if these bearish traders step on the wrong end of price cuts. As an inflation-choked consumer may look to ease their current financial burdens, price cuts (seemingly damaging in the short term) could prove bullish for market share and long-term demand. After SoFi, It’ll be Williams-Sonoma Coming Next Williams-Sonoma Today WSM Williams-Sonoma $297.68 +4.46 (+1.52%) 52-Week Range $115.09 ▼ $348.51 Dividend Yield 1.52% P/E Ratio 18.27 Price Target $259.94 Add to Watchlist Following this real estate comeback thesis, furnishing a home typically comes after securing a mortgage. This is where Williams-Sonoma could prove dangerous for its short sellers, who recently brought the stock’s short interest up to 10.7%. Wedbush analysts think Williams-Sonoma could reach $350 a share. To prove these projections right, the stock would need to rally by 19.3% from its current level, making it the company's new all-time high price. The company’s financials show a gross profit margin of up to 44.8% in the past twelve months. This allows management to keep more from each dollar sold, which feeds directly into the company’s leading profitability rates. Following return on invested capital (ROIC) rates for Williams-Sonoma, investors can notice a 26% to 31% ROIC over the past five years. As annual stock price performance typically follows the long-run ROIC rate, this is one-way investors can compound their wealth in Williams-Sonoma once short sellers step out of the picture on the housing comeback. Before you consider Sprouts Farmers Market, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Sprouts Farmers Market wasn't on the list. While Sprouts Farmers Market currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here
Shein wins Labour support as it prepares £50bn London listing 2024-06-03 14:13:00+00:00 - The Labour party has indicated its support for Shein’s potential London listing, as the Chinese online fashion company prepares to push the button on the UK’s biggest ever stock market flotation. The £52bn retailer is reportedly close to confidentially filing a prospectus for the listing on the London Stock Exchange to the Financial Conduct Authority as early as this week. Labour confirmed a report that its MPs had met the retailer, among “a range of companies including Shein that are looking to invest or list in Britain”. A spokesperson for the party said: “Raising investment, productivity and growth is one of Labour’s missions for government.” However, the listing could prove politically divisive. Shein’s decision to opt for London comes after an initial effort to float in New York was derailed when politicians and regulators raised concerns about tensions between Beijing and Washington. Senior politicians, including three parliamentary committee chairs, have questioned efforts to woo Shein, raising concerns about labour conditions in its supply chains. Labour said it expected “the highest regulatory standards and business practices” from businesses operating in the UK. “We believe the best way to ensure this is to have more companies operating from and regulated by UK law,” the spokesperson said. Jonathan Reynolds, the shadow business secretary, Sarah Jones, the shadow minister for industry, and Chris Bryant, the shadow minister for creative industries, recently met Donald Tang, Shein’s executive chair to discuss listing, the Times reported. The chancellor, Jeremy Hunt, also met Tang earlier this year to try to persuade Shein to list in the UK rather than New York. The company, which was launched in Nanjing, China, in 2012, has rapidly become one of the world’s largest fashion retailers because of its low prices and high-volume sales. It is headquartered in Singapore and, while most of its suppliers are based in China, it does not sell products to the country. The company posted more than $2bn of profits in 2023, nearly double the $1.1bn in 2021. If listed in the UK it is understood it could be valued at £50bn. The expected filing of a prospectus does not guarantee the company will list in the UK but people close to the process told Sky News – which first reported the impending filing – it represented a significant moment that meant a City float for Shein was very likely. Shein has previously responded to criticism by saying it took visibility across its supply chain seriously, had zero tolerance to forced labour and was committed to human rights. skip past newsletter promotion Sign up to Business Today Free daily newsletter Get set for the working day – we'll point you to all the business news and analysis you need every morning Enter your email address Sign up Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy . We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply. after newsletter promotion If Shein does list in the UK it would be a significant boost in what has been a gloomy period for the LSE, with a number of high-profile companies leaving the UK for listings elsewhere. Last month, the Paddy Power owner Flutter confirmed it was moving its listing from London to New York, while the UK chip designer Arm opted to list on Wall Street last August after the government failed to persuade it to float in the UK. Earlier this year, the Anglo-German travel company Tui voted to abandon the LSE in favour of listing its shares solely in Germany. However, there was some good news last month, when the UK-based tech firm Raspberry Pi confirmed its intention to float in the UK. The listing would eclipse the biggest listing seen on the LSE – the commodities company Glencore’s £38bn float in 2011 – and the spin-out of GSK’s consumer goods arm as Haleon, at £30.5bn in 2022. Separately on Monday, Shein said its resale platform, where customers can resell pre-owned products from the fast-fashion retailer, would be made available in Europe and the UK. The platform, which was launched in the US about two years ago, will be accessible in France, followed by the UK and Germany in subsequent phases, Reuters reported. The European launch may help address one of the key criticisms of fast-fashion retailers such as Shein – that its clothes are bought cheaply and then thrown away in favour of new items.
2 Premium Retailers Thriving on Growing DTC Channel Business 2024-06-03 14:03:00+00:00 - Key Points Direct-to-consumer (DTC) sales include online sales as well as sales at your own branded retail stores, cutting out wholesaler and retailer middlemen and keeping more of the pie. Canadian Goose saw 19% YoY growth, with its DTC channel accounting for nearly 75% of total sales, while wholesale revenues dropped 9% YoY as expected. Ralph Lauren grew its DTC channel to account for 2/3rds of total revenues, up from 50%. 5 stocks we like better than Canada Goose The retail apparel landscape has changed considerably. The days of thriving shopping malls are over, as they've been dying a slow death accelerated by the COVID-19 pandemic. Brick-and-mortar retail shops faced a dilemma with mandated store closings to either adopt digital innovation and embrace a direct-to-consumer (DTC) channel or get edged out by competitors. While DTC is usually referred to as digital and online sales, it also includes in-store retail sales at your stores. DTC basically cuts out the middleman wholesaler and retail partners. While the pandemic is in the rearview mirror, the strategy of bolstering the DTC channel continues to mean the difference between a thriving top and bottom line and rising stock price or continued sales and margin contraction with the looming threat of obscurity. Get Canada Goose alerts: Sign Up Here are 2 premiums in the consumer discretionary sector that demonstrate how growing the DTC channel business can improve the bottom line of both the business and its shareholders. Canada Goose’s Direct-to-Consumer Strategy Explained Canada Goose Today GOOS Canada Goose $14.72 +0.26 (+1.80%) 52-Week Range $9.80 ▼ $18.63 P/E Ratio 39.78 Price Target $14.42 Add to Watchlist The maker of premium $1675 goose-down parkas and $750 Journey boots, Canada Goose Holdings Inc. NYSE: GOOS, suffered from an inventory glut like all the retail apparel makers after the pandemic. However, the company concentrated on bolstering its DTC channel while trimming inventory levels to maximize margins. The company's strategy was to reduce its wholesale partners while maintaining its brand identity as a fashion status brand with Millennial and Gen-Z consumers. Its high quality and authenticity helped to establish Canada Goose as the premium outdoor lifestyle brand consumers are willing to pay for. The brand's elasticity was proven to investors with its stellar fiscal Q4 2024 earnings report. Canada Goose’s DTC Sales Rise 19% YoY On May 14, 2024, Canada Goose reported fiscal Q4 2024 EPS of 14 cents, beating consensus estimates by 4 cents. Revenues surged 22% YoY to $262.9 million, beating consensus estimates by $30.85 million. DTC sales rose 19% YoY to $199.38 million, and comparable sales rose 3.5% YoY. Higher digital sales in North America and Asia Pacific drove the DTC channel. The wholesale channel sales fell 9% YoY to $30.40 million. It's significant to point out that DTC sales account for 75% of total sales for Canada Goose. Canada Goose: Not Abandoning Brick and Mortar While its online DTC business is thriving, Canada Goose is not ditching the brick-and-mortar model. DTC is an omnichannel strategy comprised of both online sales and in-store sales at your own branded brick-and-mortar location. The company opened 3 new brick-and-mortar stores in the quarter, bringing the total store count to 68. The strategy here is to reduce the number of wholesale partners and inventory to continue increasing the exclusivity of its products. Canada Goose plans to keep opening retail stores at a much slower pace of 3 a year versus 17 stores last year. DTC sales are expected to grow in the low single digits in fiscal 2025, while wholesale is expected to fall by 20% YoY. Canada Goose Holdings Inc. (GOOS) Price Chart for Monday, June, 3, 2024 Canada Goose analyst ratings and price targets are on MarketBeat. GOOS stock is up 22% YTD. Ralph Lauren Beats Consensus Estimates Ralph Lauren Today RL Ralph Lauren $185.28 -1.60 (-0.86%) 52-Week Range $108.60 ▼ $192.03 Dividend Yield 1.62% P/E Ratio 19.06 Price Target $170.50 Add to Watchlist The maker of Polo shirts and over 10 brands that embrace the spirit of the American Dream lifestyle, Ralph Lauren Co. NYSE: RL, reported a stellar fiscal Q4 2024 earnings report, beating consensus estimates by 4 cents. While Ralph Lauren often partners with premium retailers like Macy’s Inc. NYSE: M and Nordstrom Inc. NYSE: JWN and even discount retailers like Ross Stores Inc. NASDAQ: ROST, they continue to grow the DTC channel. Ralph Lauren's Growing DTC Channel at Full Price In fiscal Q4 2024, Ralph Lauren grew its global DTC sales by 6% YoY. This was driven by continued brand elevation and full pricing, as average unit retail (AUR) performance rose double-digit. Its domestic brick-and-mortar stores saw a 6% YoY sales increase. Incidentally, digital sales reflected a 4% YoY drop. North American wholesale revenues dropped 2%. The company expects full-year fiscal 2025 total revenues to climb 2% to 3%. The core of its Accelerate Plan is the strategy to grow its long-term DTC channels for high margins. The DTC channel now accounts for two-thirds of its total revenues, up from 50%. Ralph Lauren CEO Patrick Louvet commented, “In fiscal '24, we added over 5 million new consumers to our DTC businesses, consistent with our long-term expectations. Our brand consideration, purchase intent, and especially our net promoter scores all increased last year, led by next-generation under 35 consumers and women. And we grew our followers on social media by low-double digits last year to over 58 million, led by Instagram, Line, Douyin and TikTok.” Ralph Lauren Co. (RL) Price Chart for Monday, June, 3, 2024 Ralph Lauren analyst ratings and price targets are on MarketBeat. RL stock is trading up 29.6% YTD. Before you consider Canada Goose, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Canada Goose wasn't on the list. While Canada Goose currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here
Dollar General Bulls Say Here and No Further: The Bottom Is In 2024-06-03 13:36:00+00:00 - Key Points Dollar General had a solid Q1 but guided for a tepid Q2 that may lead to a tepid Q3 and Q4. Guidance expects strength in the back half, but analysts aren't convinced, and price targets were lowered. The stock sold off following the release, but support was strong at a critical level, and a rebound is already in play. 5 stocks we like better than Dollar General Dollar General's NYSE: DG Q1 results were solid and highlighted the long-term opportunity in this retail stock. However, the guidance was weak, leaving the market in disarray while analysts reset the outlook and lowered their stock price targets. The takeaway is that the 8% decline in the stock price took the market to a critical support target where the bulls fought back. The ensuing action left the market up from the new low, confirming support at the bottom of a trading range, with an outlook for growth and capital returns to support it. Analysts weren’t thrilled by Dollar General’s results and reset their outlook because of it. The bulk of activity following the report is downward price target revisions that leave the sentient at Hold/Moderate Buy but cut the price target to the $135 to $140 range. Notable details cited in the chatter include strategic gains with new stores, market share, and optimism for margin improvement. Risks cited include the impact of promotions and mix on Q1 results and persistently detrimental shrinkage that may not be controllable. Get Dollar General alerts: Sign Up Dollar General Advances Position in Q1: Q2 Guidance Causes Analyst Reset Dollar General Today DG Dollar General $139.56 +2.65 (+1.94%) 52-Week Range $101.09 ▼ $173.47 Dividend Yield 1.69% P/E Ratio 20.31 Price Target $149.87 Add to Watchlist Dollar General had a solid quarter in Q1, outperforming the Marketbeat.com consensus estimate on the top and bottom lines. The company reported $9.91 billion in net revenue for a gain of 6.1% that outpaced the consensus by ten basis points. The strength is driven by growth in the consumables segment but slim due to weakness in Home Goods, Seasonal, and Apparel. Comp-store gains are positive at 2.4%, compounded by new store growth. Comp-store growth is driven primarily by traffic offset by a small decline in average ticket amount. Margin is an area of concern. The company’s margin outperformed but shrank considerably compared to last year. The gross margin fell 145 basis points on shrinkage, mix, and mark-downs, while the SG&A increased wages and incentives to leave operating profit down 26% and GAAP earnings down 30%. So, GAAP earnings of $1.65 are $0.07 better-than-expected but down double-digits compared to the top-line gains despite the 9.5% decline in inventory. Guidance is solid but tepid relative to the analysts' forecasts and gave no reason to really. The catalyst for the sell-off is a below-consensus outlook for Q2 that leaves the full-year guidance in question. The company reiterated the full-year outlook with revenue up 6% to 6.7%, but the EPS midpoint is below consensus. Given the expectation for strength in the year’s back half, it may be optimistic. The FOMC was expected to loosen economic policy this summer, paving the way for a consumer rebound that may not happen now. The latest data aligns with a hawkish FOMC and no cuts until September or later, if at all this year. Dollar General Capital Returns Safe in 2024 Dollar General Dividend Payments Dividend Yield 1.69% Annual Dividend $2.36 Dividend Increase Track Record 1 Year Annualized 3-Year Dividend Growth 8.13% Dividend Payout Ratio 34.35% Next Dividend Payment Jul. 23 See Full Details Dollar General’s capital returns are safe in 2024 but don’t expect share repurchases this year. The company has $1.4 billion left under the current authorization but indicates no buybacks in favor of increasing real estate plans. The company is cutting back on new store openings but accelerating remodels and updates for mature/maturing stores to more efficiently use CAPEX spending. The dividend should continue unabated at the current payout level of $2.36 annually or roughly 1.75%, with the stock trading near $135. The guidance and analysts' response undercut market support for this stock, but it quickly returned. The plunge and rebound have the market back above $135, and the low set in early May. Assuming the market follows through on this signal, the stock price should move sideways within its established range with a chance of hitting the range’s high end by year-end. However, the first target for resistance is near a cluster of moving averages that may cap gains. Resistance was strong at $145 leading into the report and may remain until more news emerges. The next visible catalysts are the Q1 report from Dollar Tree NASDAQ: DLTR, the June FOMC meeting, and Dollar General’s Q2 report in September. Before you consider Dollar General, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Dollar General wasn't on the list. While Dollar General currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here
Why is a group of billionaires working to re-elect Trump? | Robert Reich 2024-06-03 11:02:00+00:00 - Elon Musk and the entrepreneur and investor David Sacks reportedly held a secret dinner party of billionaires and millionaires in Hollywood last month. Its purpose: to defeat Joe Biden and re-install Donald Trump in the White House. The guest list included Peter Thiel, Rupert Murdoch, Michael Milken, Travis Kalanick, and Steven Mnuchin, Trump’s treasury secretary. Meanwhile, Musk is turning up the volume and frequency of his anti-Biden harangues on Twitter/X, the platform he owns. According to an analysis by the New York Times, Musk has posted about the president at least seven times a month, on average, this year. He has criticized Biden on issues ranging from Biden’s age to his policies on health and immigration, calling Biden “a tragic front for a far left political machine”. The Times analysis showed that over the same period of time, Musk has posted more than 20 times in favor of Trump, claiming that the criminal cases the former president now faces are the result of media and prosecutorial bias. This is no small matter. Musk has 184 million followers on X, and because he owns the platform he’s able to manipulate the algorithm to maximize the number of people who see his posts. No other leader of a social media firm has gone as far as Musk in supporting authoritarian leaders around the world. In addition to Trump, Musk has used his platform in support of India’s Narendra Modi, Argentina’s Javier Milei and Brazil’s Jair Bolsonaro. Some of this aligns with Musk’s business interests. In India, he secured lower import tariffs for Tesla vehicles. In Brazil, he opened a major new market for Starlink, SpaceX’s satellite internet service. In Argentina, he solidified access to lithium, the mineral most crucial to Tesla’s batteries. But something deeper is going on. Musk, Thiel, Murdoch and their cronies are leading a movement against democracy. Peter Thiel, the billionaire tech financier, once wrote: “I no longer believe that freedom and democracy are compatible.” If freedom is not compatible with democracy, what is it compatible with? Thiel donated $15m to the successful Republican senatorial campaign of JD Vance, who alleged that the 2020 election was stolen and that Biden’s immigration policy meant “more Democrat voters pouring into this country”. (Vance is now high on the list of Trump vice-presidential possibilities.) Thiel also donated at least $10m to the Arizona Republican primary race of Blake Masters, who also claimed Trump won the 2020 election and admires Lee Kuan Yew, the authoritarian founder of modern Singapore. Billionaire money is now gushing into the 2024 election. Just 50 families have already injected more than $600m into the 2024 election cycle, according to a new report from Americans for Tax Fairness. Most of this is going to the Trump Republican party. In 2021, Stephen A Schwarzman, the billionaire chairman and chief executive of the Blackstone Group, called the January 6 attack on the US Capitol an “insurrection” and “an affront to the democratic values we hold dear”. Now he’s backing Trump because, Schwarzman says, “our economic, immigration and foreign policies are taking the country in the wrong direction.” Trump recently solicited a group of top oil executives to raise $1bn for his campaign, reportedly promising that if elected he would immediately reverse dozens of environmental rules and green energy policies adopted by Biden. Trump said this would be a “deal” for the oil executives that would avoid taxation and regulation on their industry. Speaking from the World Economic Forum’s confab last January in Davos, Switzerland, Jamie Dimon – chair and CEO of JPMorgan Chase, the largest and most profitable bank in the United States, and one of the most influential CEOs in the world – heaped praise on Trump’s policies while president. “Take a step back, be honest,” Dimon said. Trump “grew the economy quite well. Tax reform worked”. Rubbish. Under Trump the economy lost 2.9m jobs. Even before the pandemic, job growth under Trump was slower than it’s been under Biden. Most of the benefits of Trump’s tax cut went to big corporations like JPMorgan Chase and wealthy individuals like Dimon, while the costs blew a giant hole in the budget deficit. If not for those Trump tax cuts, along with the Bush tax cuts and their extensions, the ratio of the federal debt to the national economy would now be declining. skip past newsletter promotion Sign up to Follow Robert Reich Free newsletter Get Robert Reich’s latest columns delivered straight to your inbox Enter your email address Sign up Privacy Notice: Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Newsletters may contain info about charities, online ads, and content funded by outside parties. For more information see our Privacy Policy . We use Google reCaptcha to protect our website and the Google Privacy Policy and Terms of Service apply. after newsletter promotion But don’t assume that the increasing flow of billionaire money to Trump and his Republican party is motivated solely by tax cuts and regulatory rollbacks. The goal of these US oligarchs is to roll back democracy. When asked if he was becoming more political, Musk admitted (in a podcast in November): “If you consider fighting the woke mind virus, which I consider to be a civilizational threat, to be political, then yes … Woke mind virus is communism rebranded.” Communism rebranded? Hello? A former generation of wealthy US conservatives backed candidates like Barry Goldwater because they wanted to conserve American institutions. Musk, Thiel, Schwarzman, Murdoch and their fellow billionaires in the anti-democracy movement don’t want to conserve much of anything – at least not anything that occurred after the 1920s, including Social Security, civil rights, and even women’s right to vote. As Thiel wrote: “The 1920s were the last decade in American history during which one could be genuinely optimistic about politics. Since 1920, the vast increase in welfare beneficiaries and the extension of the franchise to women – two constituencies that are notoriously tough for libertarians – have rendered the notion of ‘capitalist democracy’ into an oxymoron.” If “capitalist democracy” is becoming an oxymoron, it’s not because of public assistance or because women got the right to vote. It’s because billionaire capitalists like Musk and Thiel are intent on killing democracy by supporting Trump and the neo-fascists surrounding him. Not incidentally, the 1920s marked the last gasp of the Gilded Age, when America’s robber barons ripped off so much of the nation’s wealth that the rest of the US had to go deep into debt both to maintain their standard of living and to maintain overall demand for the goods and services the nation produced. When that debt bubble burst in 1929, we got the Great Depression. Benito Mussolini and Adolf Hitler then emerged to create the worst threats to freedom and democracy the modern world had ever witnessed. If America learned anything from the first Gilded Age and the fascism that grew like a cancer in the 1930s, it should have been that gross inequalities of income and wealth fuel gross inequalities of political power – as Musk, Thiel, Schwarzman, Murdoch and other billionaires are now putting on full display – which in turn generate strongmen who destroy both democracy and freedom. Under fascist strongmen, no one is safe – not even oligarchs. If we want to guard what’s left of our freedom, we must meet the anti-democracy movement with a bold pro-democracy movement that protects the institutions of self-government from oligarchs like Musk and Thiel and neo-fascists like Trump.
From decay to dazzling, Ford restores grandeur to Detroit train station that once symbolized decline 2024-06-03 10:00:48+00:00 - DETROIT (AP) — The once-blighted monolithic Michigan Central train station — for decades a symbol of Detroit’s decline — has new life following a massive six-year, multimillion-dollar renovation to create a hub for mobility projects in the rebirth of the Motor City. The hulking, scavenger-ravaged structure that ominously shadowed the city’s Corktown neighborhood is now home to Ford Motor Co. and the centerpiece of a sprawling 30-acre (12-hectare) mobility innovation district. The building’s first tenant, Google’s Code Next Detroit computer science education program, is expected to move in by late June. Grand opening ceremonies include an outdoor concert on Thursday, with tours for the public starting Friday. “The train station ... it is perhaps the most powerful story in Michigan of the power of historic renovation,” Detroit Regional Chamber President and Chief Executive Sandy Baruah said. “To turn something that was blight into something that is hugely attractive and is an anchor as opposed to a deficit is huge.” The restoration effort — part of the automaker’s more than $900 million project to create a place where new transportation and mobility ideas are nurtured and developed — was just as massive as the size of the more than century-old, 500,000-square-foot (46,000-square-meter) building. In numbers: __ More than 3,100 workers spent about 1.7 million hours of labor on the station and its surrounding public spaces __ 29,000 Gustavino tiles were restored in its Grand Hall __ 8.6 million miles (13.8 million kilometers) of new grout was laid across the 21,000-square-foot (1,951 square-meter) ceiling __ 8 million bricks, 23,000 square feet (2,138 square meters) of marble flooring and 90,000 square feet (8,361 square meters) of decorative plaster were restored or replicated __ 3.5 million gallons (13.2 million liters) of water was pumped from the basement __ Installation of 300 miles (482 kilometers) of electrical cable and wiring and 5.6 miles (9 kilometers) of plumbing FILE- The abandoned Michigan Central Station is seen, Thursday, Jan. 21, 2010 in Detroit. (AP Photo/Carlos Osorio_File) The entrance to the Michigan Central Station is seen, Monday, May 13, 2024 in Detroit. (AP Photo/Carlos Osorio) “It was always my hope that this project would be a catalyst for moving the city and our industry together into the future,” Bill Ford, the automaker’s executive chair and great-grandson of its legendary founder, Henry Ford, told The Associated Press last week. “It’s always the future. We’re just getting started, now. Took a long time for us to get here and a lot of hard work and a lot of blood, sweat and tears to get to this point.” The train station’s history reflects the city’s fortunes during its heyday as the world’s car capital and later misfortunes as thousands of auto workers and other residents fled Detroit for life in the suburbs. Michigan Central Railroad started purchasing land around 1908 in Corktown, the city’s oldest neighborhood, for the new train station, according to HistoricDetroit.org. The depot opened in late 1913. But as traveling by train gave way to commuter air travel and as more Americans chose to use the nation’s interstates, the numbers of people coming through Michigan Central steadily dropped. The last train pulled out in 1988 and for years after the building fell into disrepair, neglect and abandonment. It became a destination for the curious and urban adventurers seeking out such places. Other buildings in Detroit, particularly factories, suffered the same or similar fate, but due to Michigan Central’s size it became a symbol of the city’s decline. Michigan Central Station Head of Place Melissa Dittmer, right, and CEO Josh Sirefman give a tour of the train station, Monday, May 13, 2024 in Detroit. (AP Photo/Carlos Osorio) Redevelopment by its former owner never materialized. Then in 2018, Ford announced it was buying the 18-story building and adjacent structures as part of its plans for a more than 1 million square foot campus focusing on autonomous vehicles. “There’s a lot of innovation going on here,” said Jim Farley, Ford chief executive. “Very much the future of the company is going to be housed here and on the campus. It represents our future revenues.” The project is expected to bring with it thousands of tech-related jobs. Restaurants, new hotels and other service-industry businesses already are moving into and near Corktown. In December, state officials announced three proposed housing development efforts intended to meet housing needs around Michigan Central and the innovation district. Michigan Central and several other efforts around Detroit are expected to accelerate southeastern Michigan’s innovation economy, said Baruah, who added that the building and the surrounding campus will help draw the best and most innovative minds to the area. “It’s really an attraction play. It’s about talent,” he said. FILE- The interior of the Michigan Central Station is seen, Thursday, Jan. 21, 2010 in Detroit. (AP Photo/Carlos Osorio_File) The interior of the Michigan Central Station is seen, Monday, May 13, 2024 in Detroit. (AP Photo/Carlos Osorio) The reopening of the train station also comes as Detroit apparently has turned the corner from national joke to national attraction. Nearly a decade from exiting its embarrassing bankruptcy, the motor city has stabilized its finances, improved city services, staunched the population losses that saw more than a million people leave since the 1950s, and made inroads in cleaning up blight across its 139 square miles. Detroit now is a destination for conventions and meetings. Last month, Detroit set an attendance record for the NFL draft after more than 775,000 fans poured into downtown last month for the three-day event. The buzz about Detroit “is very different nationally,” Bill Ford said. “I think when people see a project like this it’ll really put an exclamation on that,” he added. “And when we’re trying to recruit people from around the country and around the world, wouldn’t you say to them then ’come to Detroit and let me show you where you can work and play and live, and also live affordably.’” FILE- The exterior of the Michigan Central Station is seen, July 13, 2023 in Detroit. (AP Photo/Carlos Osorio_File) The significance of Michigan Central’s rebirth is not lost on Mayor Mike Duggan, whose administration has guided Detroit back to respectability since the city’s 2014 exit from the largest municipal bankruptcy in U.S. history. “I’ve been waiting 40 years for this day and so have all long-time to Detroiters, so it’s going to be very special,” Duggan said last week. “It’ll be a very emotional day.” “The abandoned train station was the national symbol of Detroit’s decline and bankruptcy,” he explained. “So the fact that not only has the city come back, but that the train station has come back in such a spectacular way and the place where we’re going to be designing the automobiles of the future. It’s now about the future, not about the past.” ___ Associated Press reporter Joey Cappelletti on Mackinac Island, Michigan, contributed to this story.
Mexico elects projected winner Claudia Sheinbaum as first female president 2024-06-03 06:06:00+00:00 - Claudia Sheinbaum has made history as the first woman elected president of Mexico, according to projections from the nation's official quick count. Sheinbaum obtained between 58.3% and 60.7% of the vote, according to a statistical sample used to conduct the quick count. It was announced early Monday by Guadalupe Taddei Zavala of Mexico's National Electoral Institute. Taddei Zavala said the tally is 95% reliable. Sheinbaum addressed supporters, saying, "For the first time in 200 years of our republic, I will become the first woman president ... but as I've said in other occasions, I don’t make it alone. We’ve all made it, with our heroines who gave us our homeland, with our mothers, our daughters and our granddaughters.” Sheinbaum said she would support the freedom of free expression and protest and build a “diverse and democratic” Mexico, and assured she would respect industries and the free market while respecting the environment and "nations' self-determination." Outgoing President Andrés Manuel López Obrador hailed Sheinbaum's historic win in a video released early Monday. "I congratulate Claudia Sheinbaum, who came out as the victor, with a wide margin. It will be the first female president of Mexico in 200 years," he said. "The president [Sheinbaum] possibly got the most votes in our country's history," he added. The former mayor of Mexico City will serve one six-year term starting Oct. 1.
Ellison’s Latest Paramount Offer Has a $15-a-Share Sweetener 2024-06-03 05:02:00+00:00 - (Bloomberg) -- Film producer David Ellison’s offer for Paramount Global includes an option for nonvoting shareholders to cash out a portion of their stock for about $15 a share, according to a person familiar with the matter. Most Read from Bloomberg The offer, a roughly 26% premium to Friday’s closing price, is for only some of the shares, according to the person, who asked to not be identified because the discussions aren’t public. Spokespeople for Paramount and Ellison’s Skydance Media declined to comment. The Wall Street Journal reported the offer earlier Sunday. The cash payout is the latest attempt by Ellison to sweeten the terms of a deal that has faced opposition from some investors. The son of Oracle Corp. co-founder Larry Ellison is looking to take over the film and TV giant through a multi-step process that involves him buying out the Redstone family’s controlling stake and then merging his company into Paramount. A third part of the transaction involves Ellison and his partners investing billions of dollars more in the business, either through a share offering or debt repayment. His backers include RedBird Capital Partners and KKR & Co. A special committee of Paramount board members recommended Ellison’s latest terms last week. Now the decision is largely in the hands of Shari Redstone, Paramount’s chair and the matriarch of the family that owns about 77% of the voting stock. Paramount’s annual meeting is Tuesday. Ellison’s talks with Paramount began last year. The 41-year-old producer of films such as Top Gun: Maverick has had to increase his offer as investors including Mario Gabelli and Ariel Investment’s John Rogers expressed concern that the Redstones were getting bought out a premium and other investors were facing dilution. Apollo Global Management Inc. has made an non-binding offer for Paramount in partnership Sony Group Corp. Read More: Shari Redstone Has Three Options for Paramount (Updates with opposition, other offer beginning in seventh paragraph. An earlier version corrected the composition of the special committee.) Most Read from Bloomberg Businessweek ©2024 Bloomberg L.P.
Prediction: This Tech Stock Could Make a Big Move Thanks to Artificial Intelligence (AI) 2024-06-03 04:15:00+00:00 - The broader technology sector has received a big boost in the past year and a half thanks to the emergence of artificial intelligence (AI), which explains why the Nasdaq-100 Technology Sector index has gained an impressive 83% since the beginning of 2023. However, not all tech stocks have benefited from this surge; Snowflake (NYSE: SNOW) is one such example. Shares of the company, which provides a cloud-based data platform, have gained only 5% since the beginning of last year. Snowflake's latest results for the first quarter of fiscal 2025 (for the three months ended April 30, 2024) didn't do much to inspire investor confidence either as the stock fell more than 5%. However, a closer look at Snowflake's results indicate investors may have overreacted. Snowflake is looking to capitalize on a fast-growing market Snowflake's revenue for fiscal Q1 increased 33% year over year to $829 million, which was well past the consensus estimate of $787 million. However, the company's adjusted earnings fell 6% year over year to $0.14 per share and missed the $0.18-per-share estimate. Snowflake lowered its full-year margin guidance. It is now forecasting a non-GAAP (adjusted) operating margin of 3% for the year compared to the earlier forecast of 6%. Investors may have pressed the panic button on account of the weaker margin projection. However, the company is making a smart move by ramping up investments in AI infrastructure, a strategy that will dent its margins in the short run but could open new growth opportunities. CFO Mike Scarpelli said: "We are lowering our full year margin guidance in light of increased GPU-related costs related to our AI initiatives. We are operating in a rapidly evolving market, and we view these investments as key to unlocking additional revenue opportunities in the future." Snowflake is purchasing graphics processing units (GPUs) so that it can build AI-focused services such as Snowpark, Cortex, Document AI, and its own large language model (LLM). Cortex, for instance, gives Snowflake customers access to multiple LLMs so that they can build AI applications such as chatbots using their own data without having to invest in expensive hardware. Chief Executive Officer Sridhar Ramaswamy points out that Snowflake is witnessing "an impressive ramp in Cortex AI customer adoption since going generally available." More than 750 Snowflake customers are already using Cortex since it was made generally available on May 7. The company ended the previous quarter with a total customer base of just over 9,800, which means a nice chunk of its customer base has adopted its AI-focused offerings in a short period. Story continues This bodes well for Snowflake as its strategy of adding AI services to its cloud data platform will encourage its existing customers to spend more money, while also attracting new customers into the company's fold. After all, the AI-as-a-service market that Snowflake is targeting is expected to clock annual growth of almost 37% through 2029, generating $72 billion in revenue at the end of the forecast period. The good part is that Snowflake is already witnessing healthy growth in its customer base, while also winning a bigger share of their wallets, and AI could accelerate this trend. These metrics point toward a bright future Snowflake's customer count increased 21% year over year in the previous quarter. Even better, the number of customers who have generated more than $1 million in product revenue for the company increased at a greater pace of 30% year over year. Moreover, Snowflake's dollar-based net retention rate stood at an impressive 128%. This is a sign of higher spending by its existing customers, as this metric compares the money spent on the company's offerings in a quarter to the spending by the same customer cohort in the year-ago period. This combination of an improvement in Snowflake's customer base and higher customer spending explains why its remaining performance obligations (RPO) jumped 46% year over year to $5 billion. That was an improvement over the 41% growth in RPO in the preceding quarter. According to Snowflake, RPO represents "the amount of contracted future revenue that has not yet been recognized." The fact that Snowflake's RPO growth has accelerated, and that the metric is growing at a faster pace than its revenue, suggests that its future revenue pipeline is improving. Not surprisingly, Snowflake has raised its full-year product revenue guidance to $3.3 billion from the earlier estimate of $3.25 billion. What's more, analysts have also raised their growth expectations from Snowflake following its latest results. SNOW Revenue Estimates for Current Fiscal Year Chart Savvy investors, therefore, should consider taking advantage of Snowflake's underperformance as AI could help this tech stock regain its mojo. Should you invest $1,000 in Snowflake right now? Before you buy stock in Snowflake, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Snowflake wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $671,728!* Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*. See the 10 stocks » *Stock Advisor returns as of May 28, 2024 Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Snowflake. The Motley Fool has a disclosure policy. Prediction: This Tech Stock Could Make a Big Move Thanks to Artificial Intelligence (AI) was originally published by The Motley Fool
BofA investment chief reveals his 2nd-half playbook: Buy dips in bonds, and sell stocks after the first rate cut 2024-06-03 04:11:00+00:00 - Spencer Platt/Getty Images Investors should buy dips in bonds and sell stocks after the Fed's first interest rate cut, according to Bank of America. The call from Bank of America investment strategist Michael Hartnett is a reversal of his "anything but bonds trade." The Federal Reserve is expected to cut interest rates in the second half of the year. Bank of America investment strategist Michael Hartnett is shaking up his trading playbook for the second half of the year. In a note on Friday, Hartnett recommended investors buy dips in bonds and sell stocks after the Federal Reserve makes its first interest rate cut. The Fed is largely expected to begin cutting interest rates in the second half of the year, with the first cut most likely occurring at the September FOMC meeting, according to the CME FedWatch Tool. Hartnett's call is a reversal of his "anything but bonds" call, which was based on the idea that AI is taking over the stock market and therefore few other assets were able to grab the attention and money of investors. But after a relatively "benign" April Core PCE report was unable to boost technology stocks on Friday, Hartnett is getting more confident about turning more bullish on bonds. "Cyclical always able to trump secular and we say 3Ps of Positioning, Profits, Policy means H2 reversal of 'ABB' Anything But Bonds trade," Hartnett said. That means investors should "buy any dip in bond prices," Hartnett added. Here are the three reasons why investors should put their focus on bonds rather than stocks in the second half of 2024, according to Hartnett. Positioning "Investors very long cash, IG bonds, stocks/tech, some long 2-year UST to play Fed cuts, but no one long 30-year on debt dynamics/concern slowdown = more fiscal excess; lower long yields v obvious 'pain trade' in H2," Hartnett explained in a note from mid-May. Profits "Credit & stocks reacting bullishly to 'soft landing' odds on rise again; but 'hard landing' odds too low given stagnation of real retail sales, stalling of global PMI upturn, labor market shift from 'unambiguously strong' to 'ambiguously strong' to 'ambiguous'; 30-year Treasury best cyclical hedge for hard landing," Hartnett said. Policy "US CPI on course to be 3¾-4½% by Nov US Presidential election; while Fed wants to cut at first opportunity, inflation in '24 has stopped Fed from cutting, extending tight money policy; and on fiscal policy, true US government spent $6.3tn past 12 months, but 4th year of US presidential cycle always strongest for government spending; investors recognize fiscal stimulus 'as good as it gets'; at margin monetary easier, fiscal tighter next 12 month," Hartnett said. Read the original article on Business Insider