What I am looking at June 7, 2022 Target (TGT) is taking decisive action by marking down unwanted items and cancels orders to clear out extra inventory. That’s because anything that is about staying at home — appliances, TVs — just won’t move. No one wants to touch it now but they did the right thing for back to school. They would never be able to bring in the right merchandise otherwise. Huge hit to the bottom line, as the retailer slashed operating margin for current quarter to 2% from prior 5.3%, but said it recover to 6% in the back half of the year. Shares fell more than 9% in premarket trading following the news. This will pressure the whole retail group including Walmart (WMT) and Costco (COST). I say to buy Costco shares after they get hit because there will be a lot of hard goods in the channel. Morgan Stanley says Walmart is ready for this and doesn’t have as serious a problem. 10-year Treasury at 3.02%, but this is about deflation now, except for oil. Morons buying Kohl’s (KSS) are just tone-deaf and caught up in the process. If they had any horse sense they would walk away. But Franchise Group can’t change its stripes. The parent of Vitamin Shoppe and other retail brands has a 6.76% yield? Not a terrible balance sheet, but after Target’s news today, what is that home department worth? Natural gas prices are spiking way too high, right at the wrong time for air conditioning that uses the resource. Apple (AAPL) is going into “buy now, pay later” called Apple Pay Later , which the company announced at its annual developer conference on Monday. Right now Apple has NO credit risk, no bad debts. Its camera is going to be able to do video better. But no augmented reality (AR)? That’s what analysts at UBS, Barclays want … Morgan Stanley’s Katy Huberty says the “innovation engine at full throttle.” What the heck is the Texas attorney general Ken Paxton doing investigating Twitter (TWTR) over the number of bots on its platform? He shouldn’t be doing this. It is ridiculous and embarrassing. These are federal matters and will stay that way if it ever goes to a court. Did the Tiger Globals of the world cause this incredible overvaluation of tech stocks that we are dealing with now? They were not fazed by the valuations of the Snowflakes? (WSJ) The SEC is still gunning for payment for order flow — the compensation a brokerage firm makes for directing orders to different parties for trade execution. The regulator is looking into competitive bids for individual orders. How will Robinhood (HOOD) make money? Will broker find new revenue streams that work? Or is it still just an app with no visible fees, just invisible ones? Peloton (PTON) appoints Liz Coddington as its new CFO. Seasoned executive, was VP of finance for Amazon Web Services. UBS says that Mcdonald’s (MCD) is good in a recession. This stock always holds up … not that valuable an insight. Deutsche Bank says buy AmerisourceBergen (ABC) and McKesson (MCK). The ultimate recession stocks, so we have really decided we are going to have a recession with higher inflation EVEN though something like Target happens which is DEFLATIONARY. Evercore ISI shuffles oils: Exxon Mobil (XOM) to buy from hold. (David Faber’s documentary on the energy giant is out June 22 on CNBC.) But Club holding Devon Energy (DVN) and Occidental Petroleum (OXY) are each downgraded to hold from buy. Credit Suisse raises Exxon price target to $115 from $102. Jefferies upgrades Vale (VALE) and BHP Group (BHP) — always bad, always when inflation rages. So much research today in sync with rampant inflation … Oracle (ORCL) reports next week and Deutsche says checks with partners tell it to buy shares ahead or earnings. Coupa (COUP): good quarter, but there are so many people with higher price targets. You get this price target cutting on a great quarter. Baird says Lululemon (LULU) is doing better now than ever, with fresh new lines. It just reported a good quarter. ServiceNow (NOW) reported a monster quarter and business has accelerated. CrowdStrike (CRWD) taking big share in cybersecurity from everyone else except maybe Palo Alto (PANW). Amazon (AMZN) being pressured is a little silly because if anything having no inventory is the SOLUTION to what is happening. But the ETFs and the ill-informed just have to do what they have to do. (Jim Cramer’s Charitable Trust is long AAPL, AMZN, COST, DVN, WMT. See here for a full list of the stocks.) 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. 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A person walks into a Target store in Washington, DC, on May 18, 2022.
Stefani Reynolds | AFP | Getty Images
What I am looking at June 7, 2022
- Target (TGT) is taking decisive action by marking down unwanted items and cancels orders to clear out extra inventory. That’s because anything that is about staying at home — appliances, TVs — just won’t move. No one wants to touch it now but they did the right thing for back to school. They would never be able to bring in the right merchandise otherwise. Huge hit to the bottom line, as the retailer slashed operating margin for current quarter to 2% from prior 5.3%, but said it recover to 6% in the back half of the year. Shares fell more than 9% in premarket trading following the news. This will pressure the whole retail group including Walmart (WMT) and Costco (COST). I say to buy Costco shares after they get hit because there will be a lot of hard goods in the channel.
- Morgan Stanley says Walmart is ready for this and doesn’t have as serious a problem.
- 10-year Treasury at 3.02%, but this is about deflation now, except for oil.
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