Will the tyranny of the 10-year Treasury yield end? Will a federal government shutdown (if it happens) and an auto strike (which is happening) and high home prices bring a halt to the economic expansion and sticky inflation quicker than the Federal Reserve can? Those are the things investors are grappling with during September, a month that’s living up to its reputation as one of the worst historically. The Dow, the S&P 500 and the Nasdaq are to open higher Wednesday after another terrible session.
Following what was actually a good quarter, shares of Club name Costco (COST) are down about 1.5% early Wednesday, because no special dividend or increase in membership fees was announced. Silly, this one is the keeper. No theft to speak of. Sure sign: Wall Street price targets being raised not lowered. Costco CEO Craig Jelinek on “Mad Money” on Wednesday evening.
Target (TGT) theft: Really about worker safety NOT about profits. The retailer just can’t defend stores, saying that’s the reason it’s closing nine locations in major U.S. cities. One store in New York City’s Harlem neighborhood, two locations in Seattle, three stores in the San Francisco-Oakland area and three more in Portland, Oregon to close for good on Oct. 21.
Gordon Haskett downgrades Macy’s (M) because of credit challenges. Consumer discretionary spending high for the industry. But what about new CEO Tony Spring and a plan for more Bloomingdale’s stores? Going after the higher-end customer? Gordon Haskett downgrades Burlington Stores (BURL) to hold from buy. In off-price, we own and like TJX Companies (TJX), behind Marshalls, T.J. Maxx and HomeGoods.
Club name Danaher (DHR): Really important call. KeyBanc, get used to this, takes DHR price target down to $300 per share from $325. BUT it actually says the stock is worth more. Veralto, the environmental and applied brands spin-off, is set to starting when-issued trading Wednesday and as a separate company a few days later. Unlocking value. KeyBanc says Danaher, as a pure life sciences company, will trade at the higher end of its historical multiple range of 17 to 22 times forward 12 months enterprise value/EBITDA estimates.
Mizuho says the FTC’s antitrust lawsuit against Amazon (AMZN) is basically headline risk, and it will be around awhile. Remember, the Microsoft (MSFT) case back in May 1998 (when the DOJ filed suit) to June of 2001 (when an appeals court reversed the breakup order). FTC chief Linda Khan first took aim at Amazon back in 2017 in a law school paper. But things have changed since then. (Microsoft is a Club stock.)
UBS says wait times for Club name Apple‘s (AAPL) new high-end iPhone Pro and Pro Max BELOW last year. China just in line.
The United Auto Workers strike: “You deserved what you earned and you and you have earned a hell of a lot more than what you are getting paid,” President Joe Biden said. He joined union picket lines Tuesday. Wow, this is highly unusual rhetoric and shows these negotiations with the automakers are now off the rails. The UAW last week expanded walkouts at General Motors (GM) and Chrysler-parent Stellantis (STLA). The union has kept its strike against Club name Ford (F) to just the one original plant.
Memory and storage solutions giant Micron Technology (MU) reports its quarter after the closing bell Wednesday. Great test of REAL opportunity in artificial intelligence. Right now, we are suffering from too much fantasy and not enough fact.
Mortgage applications decrease 1.3% from a week ago. BUT, they are 21% lower than same week last year. When will this impact home prices, which hit a high in July, according to S&P CoreLogic Case Shiller index.
(See here for a full list of the stocks at Jim Cramer’s Charitable Trust.)
As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade.