Tag: industrial news

Here’s why Wall Street has fallen out of love with Tesla — for now
[ad_1]

Late on Wednesday, Tesla Inc.
TSLA,
-1.10%
reported that quarterly sales were up 47% from a year earlier. But the stock tumbled 10% on Thursday.

Tesla’s shares are still up 113% this year. The company is among a group of 13 in the S&P 500 that stand out with high growth expectations for sales, earnings and free cash flow through 2025.
But less than half of analysts polled by FactSet rate Tesla a buy. Emily Bary explains what they are worried about.

Traders have placed large short bets against Tesla and two of its rival EV makers — Rivian Automotive Inc.
RIVN,
-2.09%
and Nio Inc.
NIO,
+2.52%.
Claudia Assis looks into how well those trades have been working out.

Cody Willard explains why he remains confident that Tesla and Rivian will dominate the EV market over the long term.

Related coverage:

Here’s what may propel U.S. stocks for years.

Chipotle Mexican Grill is among 14 stocks named by Michael Brush for consideration by investors looking to ride along with long-term improvement of U.S. labor productivity.

AP

The S&P 500
SPX,
+0.03%
has returned 19% this year, following its 18% decline in 2022. On the same basis, with dividends reinvested, the benchmark index is still down 2% since the end of 2021.

What is going on? Michael Brush believes that a high level of corporate investment in new technology and equipment is setting the stage for a long phase of earnings growth for U.S. companies. He shares four developments behind the coming productivity boom and 14 stocks expected to benefit from it.

A signal for the stock-market’s health

Getty Images

The Dow Jones Industrial Average
DJIA,
+0.01%
is up 6% this year. The venerable index has trailed the S&P 500, but its closing level of 35,255.18 on Thursday was only 4% shy of its record close a 36,799.65 on Jan. 4, 2022. Joseph Adinolfi explains Dow Theory, which according to technical analysts is sending a strong bullish signal for the stock market.

Other opinions about market sentiment:
- Investors are the most bullish on stocks since before the 2022 bear market, says Vanguard
- Be greedy in your 401(k): The ‘big money’ is still fearful
Even if you have resisted the idea of a Roth IRA, you may soon be forced to have one

This year if you are age 50 or older and are already maxing-out your contribution to a 401(K), 403(B) or other qualified employer-sponsored tax-deferred retirement plan at $22,500, you can make an additional “catch up” tax deductible contribution of $7,500 for a total of $30,000. But starting in 2024, the catch up contribution will no longer be tax deductible if you earn at least $145,000 a year. You can still make the contribution with after-tax money into a Roth 401(K) account that your plan administrator may already have set up for you.

Alessandra Malito provides more details and news about employers’ efforts to delay the rule’s implementation.

Beth Pinker writes the Fix My Portfolio column. This week she digs into Roth IRA conversions, through which you can simplify your taxes down the line.

A hot vote in Spain

The center of Madrid on July 15, 2023. A brutal heat wave could affect turnout for the country’s general election on July 23.

Uncredited

Barbara Kollmeyer reports from Spain about a highly contested election on Sunday, with controversy over the government’s policies during the pandemic, parties’ social policies and the possibility of a coalition government that might rattle financial markets.

Meta vs. Alphabet

Shares of Meta Platforms Inc. and Alphabet Inc. trade only slightly higher than the S&P 500 on a forward price-to-earnings bases, while Nvidia Corp., Microsoft Corp. and Apple Inc. trade much higher.

FactSet

Leslie Albrecht looks at Meta Platforms Inc.
META,
-2.73%,
which is Facebook’s holding company and has a hit on its hands with the new Threads social-media platform, and Google holding company Alphabet Inc.
GOOGL,
+0.69%,
to consider which stock is a better buy.

Brett Arends: ‘I used to work at Nvidia. The stock I got is now half my portfolio. Should I sell?’

The Ratings Game

In The Ratings Game column, MarketWatch reporters track analysts’ thoughts about various stocks. Here’s a sampling of this week’s coverage:

You don’t know every bad factor causing air travel to be nothing but harassment

Getting there is half the fun.

Getty Images

The U.S. flying scene — from shortages of equipment and labor (and runways) to ill-staffed air-traffic control towers — is a well-known nightmare for U.S. travelers. But there is more to the story. Jeremy Binckes looks into other factors that may surprise you and cause great inconvenience this summer.

The Federal Reserve is expected to raise interest rates again next week

The Federal Open Market Committee will meet next Tuesday and Wednesday, to be immediately followed by a policy announcement. Economists expect the central to raise the federal-funds rate by another quarter point. The question is whether or not this will end the Fed’s inflation-fighting rate cycle.

More coverage of the Fed:
- Bernanke says it is clear Fed will hike interest rates next week, but a September move is ‘up for grabs’
- FedNow launches today. What to know about the Fed’s real-time payment service.
How much would you pay for 100% downside protection in the stock market?

MarketWatch illustration/iStockphoto

Over the past 30 years, the SPDR S&P 500 ETF Trust
SPY,

has returned 1,650%, for an average annual return of 10%, with dividends reinvested, according to FactSet. But it hasn’t been a smooth ride. The ETF, which tracks the benchmark S&P 500, fell 18% last year and 37% during 2008, for example. And there have been even larger declines if the analysis isn’t confined to calendar years.

But can you ride through market declines? Many studies have shown that most investors who try to time the market sell after a decline has started and buy back in well after a recovery is under way, which means their long-term performance can suffer significantly.

In this week’s ETF Wrap column (and emailed newsletter), Isabel Wang describes a new buffered fund that can give you 100% downside protection over a two-year period, in return for a cap on your potential gains in the stock market. Here’s the price you would pay for the protection.

The World Cup games have started

Hannah Wilkinson scored the home team’s first goal against Norway during the first World Cup game in Auckland, New Zealand, on July 20.

Getty Images

The Women’s World Cup began Thursday with an upset victory by New Zealand over Norway.

James Rogers reports on what is expected to be a much easier environment for FIFA and corporate sponsors than that of last year’s Men’s World Cup in Qatar.

U.S. Soccer Federation President Cindy Parlow Cone participated in MarketWatch’s Best New Ideas in Money podcast and spoke about the long-term effort to achieve equal treatment for women soccer players.

More coverage of the World Cup:

Want more from MarketWatch? Sign up for this and other newsletters to get the latest news and advice on personal finance and investing.
[ad_2]

Source link
July 21, 2023
American Express Posts Record Revenue, Earnings. It’s Still Bracing for Defaults.

[ad_1]

American Express

delivered a fifth consecutive quarter of record revenue and all-time high earnings per share, but the group remains cautious on debt struggles among cardholders as it continued to build its reserves for credit losses.

[ad_2]

Source link

July 21, 2023
3 Reasons Sirius XM Stock Just Surged 42%

[ad_1]

3 Reasons Sirius XM Stock Just Surged 42%

Sirius XM Holdings stock surged 42% Thursday on an apparent combination of short covering, an unwinding of a spread trade involving Liberty SiriusXM, and possible buying related to a rebalancing of the Nasdaq 100 index.

An error has occurred, please try again later.

[ad_2]

Source link

July 20, 2023
Bud Light sales are still falling, but investors get it at this point. Here’s what Morgan Stanley says they might be missing.

[ad_1]

Bud Light sales are still falling, as the impact of a boycott against the beer continues to stick. But Morgan Stanley analysts on Thursday said that impact was already reflected into shares of its parent company, Anheuser-Busch InBev, and that AB-InBev’s global footprint and the falling costs of beer ingredients would help sales and margins up ahead even if struggles in the U.S. spill over into next year.

Morgan Stanley assumed coverage of AB-InBev
BUD,
+0.51%
with an overweight rating, a step up from its prior equal-weight rating. The firm bumped its price target on the stock higher, to $68.50 from $64. Shares of AB-InBev were up 0.4% on Thursday.

The analysts also said that AB-InBev’s second-quarter results, set for Aug. 2, could be a clarifying moment for investors.

“While investors are currently sitting on the sidelines, waiting for the company to fully quantify the impact of the Bud Light situation, we see upcoming H1 results as likely timing for such clarification,” the analysts said in a research note.

“We think ABI shares now price in the U.S. Bud Light challenges, which have stabilised, but not the gross margin recovery and de-leveraging upside into next year,” they added later.

The conservative-led boycott against Bud Light began in April, after the brand briefly partnered with Dylan Mulvaney, a trans influencer. That anti-trans anger has translated into weeks of sharp declines, generally above 20%, for Bud Light sales. Mulvaney said Bud Light never reached out to her, despite what she said was “more bullying and transphobia than I could have ever imagined” as a result of the partnership and calls for a boycott.

The fall-off has spread to some of other AB-InBev’s other beer brands, and benefited its rivals. Modelo Especial has recently dethroned Bud Light as the best-selling beer in the U.S.. Constellation Brands Inc.
STZ,
+0.47%
sells Modelo beer in the U.S., after a deal a decade ago to acquire Grupo Modelo’s U.S. beer business from AB-InBev.

Still, the Morgan Stanley analysts emphasized Anheuser-Busch’s worldwide reach, and said that even a 13.5% drop in U.S. yearly sales — broadly, where things stand in the U.S. now — would only mean a 4% drop for the company’s sales overall. And they said double-digit growth expected elsewhere, in regions like South America and the Asia-Pacific, would drive organic sales growth of 6% for the company overall in its fiscal 2023. They also said a “wind-back” on commodity costs and sales incentives to U.S. beer sellers would help margins up ahead.

Still, they didn’t expect much of a break for sales trends in the U.S. They said they expected the 13.5% drop in U.S. sales to ease to a 12% drop in AB-InBev’s fiscal 2024.

Overall, however, the analysts were upbeat on beer sales and profits for next year. Falling ingredient costs would help brewers overall. A pandemic-era jump in U.S. demand for spirits — or hard liquor like gin, Scotch and vodka — had now “normalized,” they said.

Shares of Anhueser-Busch InBev are down 1.4% so far this year. By comparison, the S&P 500 Index
SPX,
-0.68%
is up 18.9% over that period.

[ad_2]

Source link

July 20, 2023

Electrolux Starts Preparations For Potential Divestment of Zanussi and Other Non-Core Brands During Coming Yrs

[ad_1]

By Dominic Chopping

STOCKHOLM–Electrolux on Thursday swung to an unexpected second-quarter net loss and said it is considering selling its Zanussi brand and other non-core assets during the coming years that together could raise around 10 billion Swedish kronor ($973.3 million).

The Swedish home-appliance manufacturer posted a second-quarter net loss of SEK648 million from a profit of SEK257 million as earnings were weighed by SEK643 million provision, significantly lower volumes due to weaker market demand, currency headwinds, labor cost and energy inflation.

A FactSet analyst poll had expected a net profit of SEK350 million.

Sales fell 3.2% to SEK32.65 billion, versus the SEK34.05 billion expected in a company-compiled consensus.

The weak demand environment, with lower consumer purchasing power resulting in more consumers shifting to lower price points, continued in the second quarter, it said.

Although price increases contributed somewhat positively in the quarter, earnings promotions also increased significantly and Electrolux now expects the net price effect to turn negative from the third quarter.

“In the challenging times we are now experiencing, it is vital to continue with strategic portfolio management,” Chief Executive Jonas Samuelson said.

“Further structural simplification and complexity reduction are thus being evaluated.”

Demand in 2023 is now expected to be negative in all regions.

Write to Dominic Chopping at dominic.chopping@wsj.com

[ad_2]

Source link

July 20, 2023

Tesla Beat Earnings Estimates. That Isn’t The Biggest Surprise.

[ad_1]

Tesla Beat Earnings Estimates. That Isn’t The Biggest Surprise.

[ad_2]

Source link

July 19, 2023
Netflix earnings bring big subscriber windfall, but stock gets dinged on light revenue forecast

[ad_1]

Netflix Inc. wowed Wall Street with new subscribers Wednesday, but lighter-than-expected revenue and sales projections undercut the company’s stock in extended trading.

Netflix
NFLX,
+0.59%
reported that subscribers increased by a surprising 5.9 million in the second quarter of the year, blowing past analysts’ average estimate of 1.82 million. Netflix reported fiscal second-quarter net earnings of $1.49 billion, or $3.29 a share, compared with $3.20 a share in the year-ago quarter.

Revenue improved to $8.19 billion from $7.97 billion a year ago. Analysts surveyed by FactSet had expected on average net earnings of $2.85 a share on revenue of $8.29 billion.

For the third quarter, Netflix executives guided for earnings of $3.52 a share on $8.52 billion in revenue, while analysts on average were expecting earnings of $3.23 a share on sales of $8.66 billion.

Free cash flow for the quarter was an eye-popping $1.3 billion, compared with about breakeven in the year-ago quarter.

Shares dipped slid nearly 7% in after-hours trading immediately following the release of the results, after closing the regular session with a slight increase.

Earlier Wednesday, the company ended its basic streaming plan in the U.S. ($9.99 a month) and U.K. for new and rejoining members in a move to press to add more subscribers to its ad-supported service ($6.99), which has accrued more than 5 million customers since its launch late last year. The news sent Netflix’s stock up 0.6% during the regular session.

Read more: Netflix drops basic streaming plan in push for more users of ad-supported plan

Netflix executives have hoped to goose their financial results with cheaper, ad-supported options and a crackdown on password sharing. In a letter to shareholders Wednesday, company executives said the success of paid shared accounts would be expanded to more countries.

“We expect revenue growth will accelerate in the second half of 2023 as monetization grows from our most recent paid sharing launch and we expand our initiative across nearly all remaining countries plus the continued steady growth in our ad-supported plan,” Netflix executives wrote.

In May, Netflix expanded paid sharing to more than 100 countries, which account for over 80% of its revenue. Now, it intends to “start to address account sharing between households in almost all of our remaining countries,” executives said.

Expectations among investors heading into Netflix’s quarterly report were muted. The focus was on Netflix’s switch toward better monetization with an ad-supported service and a rolling crackdown on shared accounts. Analysts in particular were closely watching the performance of Netflix’s new “Basic with Ads” plan ($6.99 a month) and its effectiveness in stanching the defection of subscribers to competing services from Walt Disney Co.
DIS,
+1.27%
and Apple Inc.
AAPL,
+0.71%.

Shares of Netflix have soared 62% so far this year, while the broader S&P 500 index
SPX,
+0.24%
has advanced 19%.

[ad_2]

Source link

July 19, 2023
Tesla reports 47% rise in sales for its second quarter, but profitability shrinks

[ad_1]

Tesla Inc. late Wednesday reported second-quarter earnings and sales that topped Wall Street’s expectations and kept intact its 2023 goal of making about 1.8 million vehicles this year, but the stock headed lower as results didn’t quite match expectations of a blowout quarter.

Losses for the shares accelerated after Chief Executive Elon Musk warned investors to expect “slightly” lower production in the current quarter due to factories that need to undergo upgrades. At last check, Tesla shares were down 4.3% in after-hours trading.

Tesla
TSLA,
-0.71%
earned $2.7 billion, or 78 cents a share, in the quarter, compared with $2.3 billion, or 65 cents a share, in the year-ago period. Adjusted for one-time items, the EV maker earned 91 cents a share.

Revenue rose 47% to $24.9 billion.

Analysts polled by FactSet expected Tesla to report adjusted earnings of 80 cents a share on sales of $24.2 billion.

In a call with analysts after the results, Musk said demand for the Cybertruck, Tesla’s electric pickup expected to be available later this year, “is so off the hook you can’t even see the hook.”

Musk used the word “turbulent” to describe the global economic background, but said that he has “high confidence in the long-term value of Tesla.”

Tesla’s bottom-line beat was “fairly sizeable,” CFRA analyst Garrett Nelson said in an interview with MarketWatch. But “this was sort of an uneventful release with no change to prior 2023 volume guidance,” he said.

“The truth is that the bar had been set pretty high heading into this release given Tesla’s meteoric run-up so far in 2023,” Nelson said. Tesla shares have more than doubled thus far in the year.

Tesla’s gross margins, another perennial preoccupation for Tesla investors in the face of several price cuts this year, were worse than expected at 18.2%, compared with consensus around 18.8%, and 25% in the second quarter of 2022, he added.

During the call with analysts, Tesla Chief Financial Officer Zach Kirkhorn called the margin drop “modest.”

The factory upgrades will carry “some amount of factory idle cost,” but Tesla is working to minimize these costs as much as possible, Kirkhorn said.

Don’t miss: Cathie Wood’s ARK funds shed more Tesla and Coinbase shares, continue Twilio buying spree

Tesla delivered a “Goldilocks” second quarter, Wedbush analyst Dan Ives said in a note late Wednesday. Margins were better than feared despite the “aggressive” price cuts, he said.

Operating margins and revenue dropped to 9.6%, from operating margins of 11% in the first quarter.

Tesla called them “healthy” even with the price cuts the auto maker went for earlier in the year, and said the margins reflected “ongoing cost reduction efforts”; the production ramp in the Berlin, Germany, and Texas factories; and the “strong performance” of its energy and services businesses.

Tesla is focusing on “cost reduction, new product development that will enable future growth, investments in R&D, better vehicle financing options, continuous product improvement and generation of free cash flow,” executives said in a letter to shareholders accompanying results.

“The challenges of these uncertain times are not over, but we believe we have the right ingredients for the long-term success of the business through a variety of high-potential projects,” the letter said.

Tesla earlier this month reported second-quarter deliveries, its proxy for sales, well above Wall Street expectations, sparking another rally for the stock. Tesla has gained 137% so far this year, compared with gains of around 19% for the S&P 500 index
SPX,
+0.24%.

Related: Tesla, Rivian are the most shorted stocks in autos, but the trade is far from profitable

[ad_2]

Source link

July 19, 2023
Il Makiage parent Oddity Tech’s stock rockets out of the gate in trading debut

[ad_1]

“We want to build something huge.”

That’s Lindsay Drucker Mann, chief financial officer of Oddity Tech, the Israeli digital consumer technology platform for the beauty and wellness market that started trading on Nasdaq on Wednesday.

The stock
ODD,
+38.23%
soared 38% out of the gate after the company’s initial public offering priced above its proposed range. The deal was also upsized in another sign of strong demand.

“We’ve unlocked online one of the most attractive and lucrative TAMs on the planet,” said the CFO, referring to the sector’s total addressable market. The beauty industry is worth an estimated $600 billion and is still dominated by bricks-and-mortar retailers.

“The encumbents are amazing megacap businesses that have built so much value over time,” said Drucker Mann. “But we believe the consumer has moved on and that we’re building the future of the category.”

The company, which was founded by Israeli sister-brother team Oran Holtzman, who is chief executive, and Shiran Holtzman-Erel, who is chief product officer, is confident its high-tech approach to the beauty business gives it a strong advantage.

For more, see: Il Makiage parent Oddity Tech is going public: 5 things to know about the Israeli digital beauty company

Oddity harnesses data science, machine learning and computer vision and artificial intelligence to allow its customers identify the correct products, formulations and shades, and it owns patented software that allows them to do it using their smartphones.

The company acquired Voyage 81 in 2021, a company that has developed software that can provide hyperspectral information.

Simply put, the eye can only see three colors — red, green and blue — but there are many more colors on smaller wavelength bands that remain invisible. Technology developed by NASA can extract that information but the hardware is expensive at a cost of $20,000 or more.

The Voyage81 software can extract the same information and bring it to all devices, allowing consumers to see more colors.

“We can analyze skin and hair features, detect facial blood flows and more. We’re building a whole new suite of tools to harness that power,” said Drucker Mann.

The results are impressive. The company’s first brand, Il Makiage, which was launched in 2018, was the fastest-growing global beauty direct-to-consumer platform from 2020 through 2022, says the prospectus, citing trade magazine Women’s Wear Daily.

Il Makiage was also the fastest-growing digital, direct-to-consumer beauty brand in the U.S. through 2021, says the IPO prospectus, citing data from Digital Commerce 360, which is its most recent available.

The second brand, SpoiledChild, launched in 2022 with the goal of disrupting the wellness category online, and is scaling even faster, said Drucker Mann.

The company now has more than 40 million users on the platform that have generated more than 1 billion data points on their beauty preferences. As of end-March, Oddity had more 4 million active customers, or customers that had made at least one purchase in the last year.

“Our business is unique in that it’s a company that’s growing and as young as we are and in tech, we’re profitable from very early on,” said Drucker Mann. “We have generated significant Ebitda margins and cash flow and so we have more than $100 million of cash on our balance sheet from earnings, and not from a capital raise.”

The company plans to use the proceeds from today’s deal to develop new products and expand into new markets. Some of those products will come out of Oddity Labs, which it set up in April to bring AI-based molecule discovery to beauty and wellness.

Brands three and four are in the works, although Drucker Mann is unable to offer details just yet.

“There are so many pain points that consumers have told us about so we’re developing products to address those,” she said.

The executive’s background as a Goldman Sachs banker made her passionate about companies and consumer products, understanding how a company works and what makes a business succeed.

“Getting global capital markets behind us when the business has never been stronger is making us excited as we look at 2024 and beyond,” she said.

The Renaissance IPO ETF
IPO,
+0.29%
has gained 45% in the year to date, while the S&P 500
SPX,
+0.32%
has gained 19%.

[ad_2]

Source link

July 19, 2023
AT&T’s stock soars toward best day in 3 years as lead-cable update sparks relief

[ad_1]

After failing to close in positive territory for a 10th session in a row Tuesday, AT&T Inc. shares were tracking toward a sizable gain in Wednesday’s trading activity.

The telecommunications stock was up 8.4% in morning trades as recent company commentary suggested to some analysts that AT&T’s
T,
+7.62%
exposure to lead-clad cables may not be as significant as feared. The company estimates that lead-clad cables represent less than 10% of its copper-cable footprint and that “a very small portion” of those run underwater.

See more: AT&T to pause prior plans to remove lead cables under Lake Tahoe as it works with regulators

AT&T shares have taken a beating lately after reporting from the Wall Street Journal keyed in on lead-sheathed cables used historically by the telecommunications industry, which the story said posed health risks.

The stock had gone 10 full trading sessions in a row prior to Wednesday without notching a gain, factoring in one session of flat performance. It fell 16.6% over that 10-session stretch, AT&T’s longest without a daily increase since one of equal length that ended Oct. 21, 2020, according to Dow Jones Market Data.

AT&T shares were on track to log their largest single-day percentage gain since March 13, 2020, when they rose 10%, according to Dow Jones Market Data.

Read also: Verizon’s lead ‘overhang’ may limit dividend increases, analyst says in downgrade

The company late Tuesday held a call with analysts and released a legal filing that left Oppenheimer’s Timothy Horan with the sense that the company’s exposure to lead cable was less than Wall Street initially expected, meaning potential removal costs could be lower than he had anticipated.

“We think [AT&T] is being conservative, but less than 10% of its footprint [or about 200,000 miles] are lead-sheathed, three-fourths of which are conduits buried underground that should likely just remain in place,” Horan wrote. “Even cables that are not buried can be left for long periods of time when safely sealed up and labeled. We believe a small minority will need to be removed, but expect [AT&T] to give more details on its earnings call next week, sooner than expected.”

He now estimates that the company could incur $2 billion to $20 billion in costs related to its exposure to lead-coated cables, whereas he had thrown out a “best guess” of $5 billion to $50 billion before Tuesday’s updates.

Cowen’s Gregory Williams was also encouraged by the disclosures AT&T made late Tuesday.

“Naturally, AT&T could not provide definitive conclusions at this time; however the company summarized the data from the court filing and essentially provided a compelling framework around the allegations,” he wrote in a note to clients. “The framework suggests a high conviction that any lead-clad cable exposure will result in very minimal health, environmental, regulatory, and financial risks, if any risk at all, and something we had suspected over the past few days of our own conversations and research.”

Shares of Verizon Communications Inc.
VZ,
+5.18%
were rallying sharply as well, up 5.4% in morning action.

Read on: Verizon CEO says the wireless market isn’t such a bad business after all

[ad_2]

Source link

July 19, 2023
Are AT&T and Verizon’s Dividends Safe? What the Math Says.

[ad_1]

Are AT&T and Verizon’s Dividends Safe? What the Math Says.

[ad_2]

Source link

July 18, 2023
Court Rules Against Uber. It’s a Victory for Drivers.
[ad_1]
This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com.

https://www.barrons.com/articles/uber-doordash-stocks-court-victory-drivers-519061c6
Updated July 18, 2023 12:39 pm ET / Original July 18, 2023 5:22 am ET

Order Reprints

Print Article
[ad_2]

Source link
July 18, 2023
Pinterest stock advances, Masimo shares slump on outlook and other stocks on the move

[ad_1]

Here are some of the biggest movers of the day:

Stock gainers:

Shares of Pinterest Inc.
PINS,
+3.64%
were gaining 4% after an Evercore ISI analyst moved to a bullish stance, cheering better advertising-market conditions and improvements made by Chief Executive Bill Ready, who is about a year into his stint.

[ad_2]

Source link

July 18, 2023
Charles Schwab’s stock on track for biggest one-day gain since March of 2020 after earnings beat

[ad_1]

Charles Schwab Corp.’s stock soared 12% Tuesday to put it on track for its biggest one-day increase since March of 2020, after the discount brokerage’s second-quarter earnings fell from a year ago but still topped consensus estimates.

Chief Executive Walt Bettinger acknowledged a “somewhat unsettled backdrop,” but said Schwab gathered $52 billion in core net new assets in the quarter, bringing the year-to-date total to more than $180 billion.

“While we observed signs of typical tax seasonality, as well as softer investor sentiment at the beginning of the quarter, we still attracted nearly 1 million new brokerage accounts and finished the period serving $8.02 trillion in total client assets across 34 million accounts,” he said in a statement.

The company
SCHW,
+12.57%
posted net income of $1.294 billion, or 64 cents a share, for the quarter, down from $1.793 billion, or 87 cents a share, in the year-earlier period. Adjusted per-share earnings came to 75 cents, ahead of the 71-cent FactSet consensus.

Revenue fell 9% to $4.656 billion, ahead of the $4.610 billion FactSet consensus.

See now: Morgan Stanley’s profit drops but beats expectations as stock rises

Bank deposits fell to $304.4 billion from $442.0 billion a year ago. The company’s clients have been engaged in a practice called “sorting,” where they are moving cash out of sweep accounts and into higher-paying products. When that process exceeds cash on hand, the company has to borrow from other funding sources that can be more expensive.

Still, Chief Financial Officer Peter Crawford said the daily outflows that have hurt the company over the last year as clients react to higher interest rates by seeking out better-paying options, began to slow.

“While anticipated client cash realignment, along with net equity buying during June, pushed cash levels lower, we observed a continued and substantial deceleration in the daily pace of cash outflows versus prior months,” he said.

Also read: Bank of America’s stock rises after second-quarter earnings and revenue beat expectations

“The continuation of this trend through the end of the quarter further strengthens our conviction that this realignment activity will inflect before the end of 2023, unlocking growth in client cash held on the balance sheet.”

On a call with analysts, Crawford said the company has not had to make any short-term borrowings from either CDs or Federal Home Loan Bank loans since late May and can now cover cash needs with organic sources.

“And as client cash realignment continues to slow and eventually reverses, we’d expect our supplemental funding balances to continue to decline over the next 18 months and be mostly paid off by the end of 2024,” he said, according to a FactSet transcript. “And this means that they should not really be a factor in our earnings picture in 2025 and beyond.”

Elsewhere, the company’s net interest income fell 10% to $2.3 billion as net interest margins fell 32 basis points from the first quarter to 1.87%.

Net interest revenue rose to $4.1 billion from $2.7 billion a year ago, while interest expenses jumped to $1.8 billion from $166 million.

The company also made progress with the conversion of client accounts from TD Ameritrade into Schwab accounts, with about 30% of accounts converted so far, said Bettinger. That comes after a major effort over the Memorial Day holiday weekend.

Schwab expects to move almost all of the rest over by year-end and to transition the final group in the first half of 2024, he said.

The stock has fallen 30% in the year to date, while the S&P 500
SPX,
+0.71%
has gained 17.8%.

Read now: JPMorgan Chase, Wells Fargo, Citi beat earnings targets but uncertainty clouds the economic outlook

[ad_2]

Source link

July 18, 2023
‘I was outraged’: Our restaurant bill was $35 each, but our friend wanted to pay $22 for a gluten-free dish. Who’s right?

[ad_1]

Dear Quentin,

I went for dinner with six friends last weekend, and we each ordered entrees and desserts, and some side orders. One of our group only eats gluten-free food, so he ordered two starters. We split the bill, and it worked out at $36 each. But our gluten-free friend cried foul, and asked for a separate check to pay $22 for his gluten-free dish. I was outraged — and almost felt physically sick. I kicked my husband under the table, and said under my breath, “Can you believe that?’

Can you believe it? Do you think he should have just paid the $35 instead of asking for a separate check? Adding insult to injury, he left the waiter a $10 tip. Why not just pay $35 like everyone else? I told my husband I was never going for dinner with him again. Don’t you think he should have just paid $35 like everyone else? It was a big crowd. If everyone did that, you’d need a forensic accountant to figure out how many breadsticks someone ate.

We otherwise had a nice evening, and it was a bring-your-own-bottle restaurant. I work as a teacher and my husband works in tech. We own a home together and have three kids. Our gluten-free friend is a freelance consultant, and is divorced with two kids. He had a very privileged upbringing. I worked hard for everything I have. I’m not saying any of us are rich, but when we go out to eat, we like to share and share alike, and split the bill down the middle.

When did eating out become so full of these cringeworthy moments?

Equal Bill Splitter

Dear Equal,

I’m sorry to say that the most cringeworthy moment here happened when you kicked your husband under the table. I’m not a big fan of under-table communication in a group, and while we could debate the pros and cons of asking for a separate check for a $13 difference, I don’t think there’s much of a gray area when it comes to calling someone out at the dinner table, especially when your eye-rolling and disapproval could be picked up by the other guests.

As far as your friend is concerned, $13 is a lot of money to pay when you did not eat all the food that was ordered by the table. Maybe it doesn’t seem like it to you or anyone reading this column, but your friend is divorced with two kids, and works as a freelancer — so let’s assume his income is not always stable. Could he have just split it down the middle and paid $35 and another 15% or 20% for a tip? Sure. But he has good financial boundaries. I applaud him.

The real issue here may go back to your respective upbringings, and could explain your dramatic — and I would argue disproportionate reaction — to your friend asking for a separate $22 check. You’ve worked hard, and maybe your friend had an easier start in life, but that doesn’t mean he’s not entitled to pay for what he ate, and watch every dollar. Divorce is like a recession. You can end up struggling to get back on your financial feet for years.

Perhaps your friend had always intended to pay $22 for his gluten-free dish, and tip the server 50%, or perhaps he has a well-trained side eye and caught your reaction to his paying for his own order, and he decided to pay closer to what everyone else had paid. But ordering separate checks, I suspect, will become more common as prices continue to rise, even at a slower pace, and people feel uncertain about spending money in restaurants.

You believe in equality of bill splitting. I suggest you apply that equality to all dinner guests, regardless of upbringing and dietary restrictions, and allow them to make their own choices about what they pay for at dinner. People often have problems — financial or otherwise — that we are not aware of, so try to leave space for that. And if your friend did see your eye-rolling and under-the-table antics? I’d like to think he made space for your behavior too.

Readers write to me with all sorts of dilemmas.

By emailing your questions, you agree to have them published anonymously on MarketWatch. By submitting your story to Dow Jones & Co., the publisher of MarketWatch, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.

The Moneyist regrets he cannot reply to questions individually.

More from Quentin Fottrell:

I had a date with a great guy. I didn’t drink, but his wine added $36 to our bill. We split the check evenly. Should I have spoken up?

‘I’m living paycheck to paycheck and I feel drained’: My fiancé said he would pay half of the mortgage. Guess what happened next?

‘We live in purgatory’: My wife has a multimillion-dollar trust fund, but my mother-in-law controls it. We earn $400,000 and spend beyond our means.

[ad_2]

Source link

July 18, 2023
Bank of America, Morgan Stanley, Lockheed, Masimo, Novartis, and More Stock Market Movers
[ad_1]
We’ve detected you are on Internet Explorer. For the best Barrons.com experience, please update to a modern browser.

Summary

Summary

U.S

Europe

Asia

FX

Rates

Futures

ETFs

Crypto

This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com.

https://www.barrons.com/articles/stock-market-movers-98396473

Updated July 18, 2023 5:41 am ET / Original July 18, 2023 4:48 am ET

Order Reprints

Print Article

These Stocks Are Moving the Most Today: Bank of America, Morgan Stanley, Lockheed, Masimo, Novartis, and More

Stock futures pointed to a steady start for Wall Street on Tuesday ahead of bank earnings and data on U.

An error has occurred, please try again later.

Thank you

This article has been sent to
[ad_2]
Source link
July 18, 2023
Cathie Wood’s ARK funds dump $26 million more in Coinbase stock, shed $13 million more of Tesla shares

[ad_1]

Funds associated with Cathie Wood’s ARK Investment continued to cull shares of Coinbase Global Inc. and Tesla Inc. on Monday, according to recent trade disclosures.

The ARK Fintech Innovation ETF
ARKF,
+1.58%
dumped 76,788 Coinbase shares
COIN,
+0.23%
on the day, while the ARK Innovation ETF
ARKK,
+2.29%
sold 127,266 and the ARK Next Generation Internet ETF
ARKW,
+2.23%
sold 44,784 shares.

Those were worth $26.3 million based on Coinbase’s Monday closing price of $105.55, and the sales follow ARK’s move to dump about $50 million in Coinbase’s stock Friday.

Coinbase represents 0.78% of the Fintech Innovation ETF, along with 0.15% of the Innovation ETF and 0.30% of the Next Generation Internet ETF. ARK disclosed the transactions and weightings in the daily trade notifications it posts to its website.

Read: Coinbase’s spectacular stock surge after Ripple ruling sparks fierce debate

Meanwhile, the ARK Innovation ETF shed 38,329 Tesla shares
TSLA,
+3.20%
on Monday, while the ARK Next Generation Internet ETF sold 6,855. Those shares were worth $13.1 million based on Tesla’s Monday closing level of $290.38. Tesla represents about 0.12% of both funds as they continue to unload shares.

Don’t miss: Tesla is looking at its best sales quarter ever

ARK scooped up 455 shares of Meta Platforms Inc.
META,
+0.57%
within its Next Generation Internet ETF and bought up 3,729 shares within the ARK Innovation ETF. That amounted to $1.3 million worth of stock based on Meta’s $310.62 Monday close.

Two ARK funds bought a combined $790 million in Robinhood Markets Inc.’s stock
HOOD,
+0.89%,
with the fintech fund scooping up 25,641 shares and the Next Generation Internet ETF buying 37,630 shares. ARK added 4,608 shares of SoFi Technologies Inc.
SOFI,
+4.41%
to the fintech fund, worth $43,683 based on Monday’s close.

See also: SoFi’s stock catches another downgrade as analyst says it ‘needs to be valued more like a bank’

ARK was also active in shares of Twilio Inc.
TWLO,
-0.63%,
buying 15,702 within the Fintech Innovation ETF, 133,499 within the Innovation ETF and 22,748 within the Next Generation Internet ETF. That amounted to $11.4 million in Twilio’s stock based on Monday’s $66.47 closing price.

[ad_2]

Source link

July 17, 2023
AT&T’s stock sinks toward 30-year low as it nabs another downgrade

[ad_1]

Shares of AT&T Inc. were falling again Monday after a Citi Research analyst weighed in with a more cautious view in light of recent reporting on legacy use of lead-sheathed cables within the telecommunications industry.

Citi’s Michael Rollins cut his rating on AT&T’s stock
T,
-6.69%
to neutral from buy Monday, writing that it was among names that could see an “overhang” following The Wall Street Journal’s recent reporting on risks related to industry’s historical use of lead-sheathed cabling as Wall Street works to understand potential financial implications.

He also downgraded shares of Frontier Communications Parent Inc.
FYBR,
-15.79%
and Telephone & Data Systems Inc.
TDS,
-8.38%
to neutral from buy, and he already had a neutral rating on Verizon Communications Inc.’s stock
VZ,
-7.50%.

“First, copper network deployed with possible lead sheathing could be a significant percentage of the legacy network deployed nationally with varying exposures for each firm,” Rollins wrote. He said he was “unable to specifically quantify financial risks (if anything material)” for wireline telecommunications companies stemming from these issues, though “the timing to receive more information could take at least a couple months and full resolution could take years.”

AT&T’s stock was off 3.8% in Monday morning action, to a recent $13.95, and on track to close at its lowest level since March 24, 1993, according to Dow Jones Market Data. The stock is on pace to spend a ninth-straight session without a daily gain, factoring in one day of flat performance last week alongside a string of daily losses.

“We still expect the company to display forward progress on cash flow generation and setting the stage to reduce net debt leverage over the next two years before considering any potential liabilities, if anything material, associated with lead sheathed cables,” Rollins wrote, though he called out “uncertainty from the industry’s use of lead-sheathed cabling” as a key reason for the downgrade.

See also: AT&T sees ‘incredibly healthy’ wireless market, even as several factors will ding growth this quarter

Frontier shares were down 8.2%, while TDS shares were off 5.0%. Verizon’s stock was down 1.6% and on pace for its eighth consecutive losing session.

USTelecom, a trade association that counts AT&T and Verizon as members, said in a statement that the telecommunications industry “has a long tradition of closely following science and evidence as it relates to public health, environmental protection, and worker safety issues,” while “safe work practices within the industry have proven effective in reducing potential lead exposures to workers.”

There are “many considerations” that go into deciding whether to remove legacy cables, “including those regarding the safety of workers who must handle the cables, potential impacts on the environment, the age and composition of the cables, their geographic location, and customer needs as well as the needs of the business and infrastructure demands,” the spokesperson continued.

The trade group said in a prior statement that it had “not seen, nor have regulators identified, evidence that legacy lead-sheathed telecom cables are a leading cause of lead exposure or the cause of a public health issue.”

Representatives from Frontier and TDS couldn’t immediately be reached for comment.

Rollins noted in his report that “Verizon and AT&T indicated their expectation as that the exposure should be small,” though he said that “for Verizon, we learned the term ‘small’ could be as much as 20% of its copper network infrastructure.”

Don’t miss: Verizon CEO says the wireless market isn’t such a bad business after all

He joined JPMorgan’s Philip Cusick, who downgraded AT&T’s stock Friday and mentioned potential lead-cable liabilities as a concern.

SVB MoffettNathanson analyst Craig Moffett weighed in on the issue as well Monday, calling out heavy uncertainty.

“The unsatisfying, but honest, answer is that at this point we have nothing but unknowns to work with and no real way to quantify the companies’ exposures,” he wrote. “Lead risk is clearly not a good thing, but we don’t know how bad it will ultimately be. It would be disingenuous to try putting firm numbers around it.”

[ad_2]

Source link

July 17, 2023
Rivian stock falls with Tesla’s Cybertruck seen as ‘fundamental and headline risk’

[ad_1]

Shares of Rivian Automotive Inc. were being driven toward a third-straight loss Monday, after Tesla Inc.’s first Cybertruck was rolled off the assembly line over the weekend.

“We see competitive pricing and specs for the Cybertruck as a fundamental and headline risk to [Rivian],” wrote Baird analyst Ben Kallo in a note to clients.

Rivian’s stock
RIVN,
-3.25%
dropped 2.5% in premarket trading. It has shed 4.2% over the past two sessions, after closing July 12 at a seven-month high.

Tesla shares
TSLA,
+3.38%
gained 2.0%, putting them on track to open at a 10-month high.

Rivian’s R1T electric truck has a starting price of $73,000 and the R1S sport-utility vehicle (SUV) starts at $78,000, while reports have the Cybertruck starting at around $40,000.

Tesla Chief Executive Elon Musk said in early 2023 that volume production of the Cybertruck would start in 2024. The Cybertruck was first unveiled in 2019, but faced a number of production delays since then.

Meanwhile, Baird’s Kallo also said despite Rivian’s (RIVN) strong second-quarter deliveries report, he was “cautious” about Rivian’s stock ahead of second-quarter results, which are due out Aug. 8, given concerns over the costs of the development of the electric vehicle maker’s Georgia facility.

“As both a positive and a negative, RIVN will need to raise capital in the near to medium term in order to fund the project and note that the recent stock appreciation may create an attractive opportunity for RIVN to execute an equity raise,” Baird wrote.

Rivian’s stock has run up 80.8% over the past three months through Friday, while Tesla’s stock has run up 50.4% and the S&P 500 index
SPX,
+0.07%
has gained 7.1%.

[ad_2]

Source link

July 17, 2023

H&M to Launch in Brazil During 2025

[ad_1]

By Dominic Chopping

STOCKHOLM–Sweden’s Hennes & Mauritz Monday announced plans to launch physical and online stores in Brazil during 2025.

The fashion retailer said it will initially enter major cities in southeast Brazil with a view to further increase its presence across the country over time.

In Latin America, H&M is currently present in Mexico, Peru, Uruguay, Chile, Colombia, Ecuador, Guatemala, Panama, and Costa Rica, and it said that with a population of over 210 million in Brazil there is considerable potential for expansion.

To support the initiative H&M said it is partnering with Dorben Group, a Latin American luxury and fashion retail partner.

Write to Dominic Chopping at dominic.chopping@wsj.com

[ad_2]

Source link

July 16, 2023

Tag: industrial news

Here’s what may propel U.S. stocks for years.

Chipotle Mexican Grill is among 14 stocks named by Michael Brush for consideration by investors looking to ride along with long-term improvement of U.S. labor productivity.

A signal for the stock-market’s health

Even if you have resisted the idea of a Roth IRA, you may soon be forced to have one

A hot vote in Spain

The center of Madrid on July 15, 2023. A brutal heat wave could affect turnout for the country’s general election on July 23.

Meta vs. Alphabet

Shares of Meta Platforms Inc. and Alphabet Inc. trade only slightly higher than the S&P 500 on a forward price-to-earnings bases, while Nvidia Corp., Microsoft Corp. and Apple Inc. trade much higher.

The Ratings Game

You don’t know every bad factor causing air travel to be nothing but harassment

Getting there is half the fun.

The Federal Reserve is expected to raise interest rates again next week

How much would you pay for 100% downside protection in the stock market?

The World Cup games have started

Hannah Wilkinson scored the home team’s first goal against Norway during the first World Cup game in Auckland, New Zealand, on July 20.

3 Reasons Sirius XM Stock Just Surged 42%

Dear Quentin,

Dear Equal,

These Stocks Are Moving the Most Today: Bank of America, Morgan Stanley, Lockheed, Masimo, Novartis, and More