Friday, November 27, 2015
- "We believe Thanksgiving shopping was a bust," says SunTrust, following channel checks in the New York metro area, New England, and the Southeast starting yesterday and continuing through the night into Black Friday.
- Team members dispatched to malls had no problem finding parking or navigating stores, says SunTrust, and there seemed to be more browsing than buying going on.
- Lines at Wal-Mart (WMT -0.5%) and Target (TGT +0.3%) were about half of last year, but Kohl's (NYSE:KSS) was the exception to lame traffic.
- Joining Kohl's among early winners according to SunTrust are Aeropastale (ARO +0.8%), Abercrombie & Fitch (ANF +0.2%), American Eagle Outfitters (AEO -0.4%), and Kate Spade (KATE -2.6%). New York & Co. (NWY +1.9%) was among the early losers. Gap (GPS -2.7%) scores both a win and a loss, with Old Navy looking good, but Gap stores not so much.
- Hanging out at Minneapolis' Mall of America, KeyBanc's Edward Yruma says traffic looks weaker than past years. "It doesn't look much busier than an average Saturday morning."
- ETFs: XLY, XRT, VCR, RTH, RETL, FXD, FDIS, RCD, PMR, BITE
- J.P. Morgan sees a strong end to the year for automakers Ford (NYSE:F) and General Motors (NYSE:GM), with a particularly strong November in the U.S. ahead as well as China sales beating expectations.
- The firm's Ryan Brinkman sees U.S. light vehicle SAAR heading up to 18.5M in November from October's 18.1M (which itself was up 10% Y/Y) -- meaning that not only would November purchases beat all other November figures, they would be the most of any other month in the current cycle.
- While incentives are down Q/Q, they're up about $100 Y/Y but resulting in average transaction prices up more than $1,000 from a year ago.
- “Some automakers we spoke to were surprised at the rate of improvement in recent months, pointing to unexpectedly strong consumer reaction to only modestly higher incentives, which has lowered inventories (a recipe for strong profitability),” Brinkman wrote.
- Previously: U.S. auto sales expected to set a record in November (Nov. 24 2015)
- Walt Disney (DIS -3.3%) tumbles more than 3% in early trade after disclosing late Wednesday that ESPN subscribers fell 3.2% Y/Y to 92M as of Oct. 3 - a level last seen a decade ago - from 95M a year earlier.
- Shares of DIS and other media stocks already were thumped over the summer when DIS said its cable business - in which ESPN comprises ~75% of total revenue - would see operating income growth only in the “mid-single digits."
- Wells Fargo’s Marci Ryvicker estimates the subscriber loss has cost $700M in FY 2015 cable affiliate fee revenue and $200M in 2015 cable EBITDA, although she reiterates a Market Perform rating on the shares.
- Target (NYSE:TGT) reports a "successful" start to its Black Friday weekend, including "unprecedented" results on its website and a strong turnout in stores on Thanksgiving Day.
- TGT says top selling Black Friday items so far include Apple iPads, gaming consoles including Nintendo Wii U, TVs, Beats Solo 2 headphones... and stuffed teddy bears.
- TheStreet.com reports findings generally consistent with TGT's commentary, based on 10 visits to Target stores on Long Island yesterday, but that crowd sizes at TGT's openings were not quite as large as those seen at competitors J.C. Penney (NYSE:JCP) and Best Buy (NYSE:BBY).
- Toyota (NYSE:TM) outsold Volkswagen (OTCQX:VLKAY) for the fourth straight month in October to remain the world's top-selling automaker after sales at the German company slumped following its diesel emissions scandal.
- Toyota's group vehicle sales totaled 8.35M from January to October, more than the 8.26M vehicles delivered by Volkswagen during the same period. Toyota has now continuously outsold its arch-rival on a year-to-date basis since July.
- The shaky condition of U.S. retail will be put to the test this weekend, when stores across the country roll out their Black Friday specials.
- About 135.8M Americans are expected to shop in stores or online over the four-day weekend, according to the National Retail Federation, but the amount they've spent has declined over the past two years, dropping 11% to $50.9B in 2014.
- The forecast for frugal shopping also got a boost on Wednesday, when Commerce Department figures showed household spending rose less than expected in October.
- ETFs: XLP, XLY, VDC, XRT, VCR, RTH, PBJ, RETL, PEJ, IYK, FXG, IYC, SCC, FXD, RHS, UCC, PMR, UGE, RCD, PSL, PSCC, SZK, FDIS, FSTA, PSCD, PEZ
- Two engineers have been suspended at Volkswagen's luxury arm Audi (OTCPK:AUDVF) after its larger diesel engines were found evading emissions limits in the United States.
- The news widens a scandal at parent VW which has led to the ouster of its long-time chief executive and wiped more than €20B ($21B) off the group's market value.
- A multi-state E. coli outbreak that has sickened at least 19 people who ate rotisserie chicken salad sold at Costco (NASDAQ:COST) has been traced to a celery-and-onion mix used in the salad.
- According to the Centers for Disease Control and Prevention, the number of people affected by the outbreak could grow over the next few weeks (even though the product has been removed from store shelves), since the the spread of the foodborne illness takes some time to track.
- Previously: More people seen affected by Costco E.coli outbreak (Nov. 26 2015)
- Just days before the start of the UN climate talks in Paris, Unilever (NYSE:UL) has announced a fresh wave of environmental commitments in a bid to ensure it becomes "carbon positive" by 2030.
- The company said it would stop using energy from coal by 2020 and will seek to support renewable energy generation, so by 2030 it can make a surplus available to markets and communities where it operates.
Thursday, November 26, 2015
- The Centers for Disease Control and Prevention says the number of people affected by an E. coli outbreak linked to Costco's (NASDAQ:COST) rotisserie chicken salad will likely grow over the next few weeks, even though the product has been removed from store shelves.
- According to the agency, the spread of foodborne illness takes some time to track, especially when it's happening in multiple states.
- Previously: Costco seen cruising past tainted chicken salad incident (Nov. 25 2015)
- Previously: Costco chicken salad linked to E.coli poisoning in seven states (Nov. 24 2015)
Wednesday, November 25, 2015
- United Continental (UAL -1.1%) will offer pilots a pay rate increase of 13% in 2016 under the terms of a new contract offer, sources tell Bloomberg.
- Pilots would earn pay raises of 2% and 3% in the following two years.
- The company is negotiating with the pilots union well in front of the expiration of the current contract in the early part of 2017.
- Nike (NKE +0.9%) carved out a new all-time high of $134.55 earlier today as the company's revelation of a stock split and dividend hike continue to help bring in buyers.
- SA contributor Tim McAleenan has a breakdown on why he thinks Nike is still a strong dividend stock to hold.
- Previously: Nike shares the spoils with new buyback plan, dividend hike, and stock split (Nov. 19 2015)
- Previously: Nike +4% after string of good news (Nov. 20 2015)
- Cowen & Company sees only a minimal risk to traffic at Costco (COST -0.1%) from the E. coli contamination of chicken salad at stores in several states.
- The outbreak is smaller than the incidents at Chipotle and less likely to harm overall brand reputation, reasons Cowen.
- Previously: Costco chicken salad linked to E.coli poisoning in seven states (Nov. 24 2015)
- Credit Suisse thinks 2016 is the year that sales leverage kicks in for Tesla Motors (NASDAQ:TSLA). The bullish note from the firm includes a prediction of lower-than-consensus SG&A spending and R&D investments to help free up cash flow. In the near term, CS says 17K units in Q4 is "achievable" after factoring in some extra sales in Denmark and the U.K.
- Tesla more than doubled the number of superchargers in the U.S. to 224 over the last year, but saw an even higher pace for new destination chargers. The number of destination chargers at hotels, restaurants, and other retail outlets now totals over 1.2K, according to Cleantechnica.com
- Earlier this week, several research firms issued positive forecasts for U.S. auto sales in November. It's unclear if that burst of buying during a typically dull month will extend out to Tesla. YTD electric vehicle sales in the U.S. have trailed the pace of overall auto sales. $2 gas prices at the pump aren't helping that trend.
- Shares of Tesla are up 3.89% to $226.75
- Keurig Green Mountain (GMCR +7.3%) extends its post-earnings rally. Shares of GMCR are now up 30% since the Q3 numbers and fresh guidance came in.
- The one-week rally for Keurig is putting some pressure on shorts.
- GMCR short interest position by date
- Previously: Keurig Green Mountain beats by $0.14, beats on revenue (Nov. 18 2015)
- Previously: Keurig Green Mountain roars back after earnings (Nov. 18 2015)
- Swatch (OTCPK:SWGAY) and Visa (NYSE:V) plan to partner on a new smartwatch device to be sold in the U.S. and Europe, according to Swiss media reports.
- The smartwatch will allow owners to make payments through the Visa technology.
- A formal announcement from the companies is expected within a few days.
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