What I’m Watching July 26, 2022 Club holding Walmart (WMT) is screwing up apparel again, issuing a big profit warning after the closing bell on Monday. I have to ask if Walmart has it under control? Long a trusted name, is it time to ditch these guys? Who is the real culprit? Spending too much money on food and gas? Or is it economical because American Express (AXP) is on the rise. Or is it travel because Borders and AMEX are up? Is this a change in trend as people spend less on clothes? Did they have their clothes from two years ago? Do they buy online? All of these questions are up for grabs, especially because mall drapers are doing poorly too. Club holding Amazon (AMZN) is NOT a good read of Walmart: 55% third party at AMZN, different assortment of merchandise. Club holding Costco (COST) is NOT a good read. Usually no clothes and definitely no heavy inventory. Members-only concept. The stock will be lower on Tuesday, and this could be a chance to buy. Walmart terrible for all flotsam and jetsam clothing companies: Stitch Fix (SFIX), Gap (GPS), American Eagle Outfitters (AEO), Urban Outfitters (URBN), Kontoor Brands (KT), Rent the Runway (RENT). Revolve (RVLV), a fashion retailer for Millennials and Gen-Z, double downgraded by Bank of America for selling (underperforming) on buying. However, analysts like PVH Corporation (PVH) and Levi Strauss (LEVI). Shopify (SHOP) will lay off 10% of its global workforce. CEO Tobi Lutke writes to employees that he thinks some of Covid’s surge in online sales will remain. But he says no. Thirteen of the 33 companies in our Club portfolio are reporting results this week, starting with Alphabet (GOOGL) and Microsoft (MSFT) after the closing bell on Tuesday afternoon. Here’s what Wall Street expects and what we’re looking for. McDonald’s (MCD), like Walmart, is a component of Dow. The fast-food chain on Tuesday reported second-quarter adjusted earnings of $2.55 a share versus $2.47 expected. Revenue of $5.72 billion missed. Same-store sales in the United States rose 3.7%, better than expected, in the quarter. Cola-Cola (KO) beat second-quarter adjusted EPS and revenue: 70 cents on sales of $11.3 billion. Overall unit case volume increased by 8%. Guidance: Full-year organic revenue growth of 12% to 13% vs. prior growth of 7% to 8%, free cash flow of approximately $10.5 billion. Always headwinds. Broad-based inflation. Recession here in convenience stores. Leisure industry theme park on fire. Dow stock 3M (MMM) separates from its healthcare unit; grant a $1 billion earplug litigation trust to its subsidiary Aearo Technologies. 3M also reports adjusted EPS of $2.48 for the second quarter on sales of $8.7 billion. Both beat the estimates. General Motors (GM) missed second-quarter earnings and revenue: $1.14 EPS on sales of $35.76 billion. He announced in advance, sticking to the projection of the year. The standalone unit, Cruise, lost $543 million more than expected. GM also says it has secured the battery materials needed to build 1 million electric vehicles a year by 2025. General Electric (GE) excellent for aerospace, OK for healthcare, renewable energy and l ‘electricity. Do you get all this for free with the aero being so strong? GE reports second-quarter earnings and revenue above expectations: adjusted EPS of 78 cents on sales of $17.88 billion. Whirlpool (WHR) makes a lot more money than people think. weak United States. But here’s the bottom line: They say cost inflation is peaking. Cut full-year EPS guidance to $22-$24 per share from $24-$26. Raytheon Technologies (RTX) adjusted EPS by $1.16 vs. $1.13 expected; sales miss $16.31 billion from $16.66 billion. Big arrears. Strong Pratt & Whitney unit. United Parcel Service (UPS): Adjusted EPS in the second quarter of $3.29 vs. $3.16 expected. Revenue of $24.77 billion versus $24.65 billion expected. All good. Paramount Global (PARA), formerly ViacomCBS, was double downgraded from sell to buy at Goldman Sachs. Goldman Sachs Lowers Club Holding Disney (DIS) Price Target to $130 Per Share from $148; weakness in the advertising market, but not as bad as people think. (Jim Cramer’s Charitable Trust is long WMT, AMZN, COST, GOOGL, MSFT, and DIS. See here for a full list of stocks.) As a CNBC Investing Club subscriber with Jim Cramer, you’ll receive a trade alert before Jim does a shop. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTMENT CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, AS WELL AS OUR DISCLAIMER. NO OBLIGATION OR FIDUCIARY DUTY EXISTS, OR IS CREATED BY YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTMENT CLUB. NO SPECIFIC RESULTS OR PROFITS ARE GUARANTEED.
Customers outside a Walmart store in Torrance, California, U.S., Sunday, May 15, 2022. Walmart Inc. is expected to release earnings numbers on May 17.
Bing Guan | Bloomberg | Getty Images
What I watch July 26, 2022
club outfit walmart (WMT) is screwing up the clothes again, announcing a big profit warning after the closing bell on Monday. I have to ask if Walmart has it under control? Long a trusted name, is it time to ditch these guys? Who is the real culprit? Spending too much money on food and gas? Or is it economical because American Express (AXP) are on the rise. Or is it travel because Borders and AMEX are up? Is this a change in trend as people spend less on clothes? Did they have their clothes from two years ago? Do they buy online? All of these questions are up for grabs, especially because mall drapers are doing poorly too.
