10 things to watch in the stock market Friday including a bullish call on Best Buy

Harsh — Fri, 27 Sep 2024 13:46:00 +0000

10 things to watch Friday, Sept. 27 1. The S & P 500 was looking at a slightly higher open Friday after another record high close. The 10-year Treasury yield was finally lower following a tame August reading on the Fed’s favorite inflation gauge, the PCE price index. With just a couple trading days left in what’s historically the worst month of year, the S & P 500 was heading for its first September gain in five years. 2. Club holding Costco shares were a tad lower after a solid fiscal 2024 fourth-quarter earnings report Thursday night . The wholesale retailer’s long-awaited membership fee increase, which took effect Sept. 1, will have a limited impact until the back of its fiscal 2025 and into fiscal 2026, executives said. We raised our price target on the stock. 3. Best Buy was added to JPMorgan’s analyst focus list after a meeting with the electronics and appliance retailer’s management team. The analysts, who reiterated their $111 price target, called Best Buy a “value idea” to take advantage of the computing replacement cycle along with TV and appliance sales growth as existing home sales improve. That closely mirrors the Club’s investment thesis. 4. The Food and Drug Administration approved Bristol Myers Squibb ‘s schizophrenia drug Cobenfy, the first new treatment for the disorder approved in seven decades. Shares of the New Jersey-based drugmaker were up more than 3% on the news. 5. Wynn Resorts was upgraded to a buy-equivalent rating at Morgan Stanley. Analysts say the casino operator’s stock can start to command a higher valuation thanks to stability in Las Vegas, more details around its project in the United Arab Emirates, and increased capital returns. Wynn shares had struggled mightily since the spring but caught a bid in recent days on China stimulus news. The Chinese gaming hub of Macau has been a thorn in Wynn’s side. 6. Citigroup downgraded Dollar General to sell from neutral and slashed its price target on the stock to $73 a share, which is about $14 below its Thursday close. Analysts argued that Walmart is taking market share, making a recovery for the dollar store retailer more difficult. Jim Cramer blamed Walmart for Dollar General’s ugly earnings report last month. 7. Deutsche Bank restarted coverage of Dell Technologies with a buy rating and price target of $144 a share. The analysts expect Dell’s revenue growth to accelerate into the double digits due, in part, to the growth of its AI server business; project its bottom line growth rate to also reach double digits; and tout its “clean and simple” capital return framework. 8. Be careful ahead of PepsiCo ‘s earnings report Oct. 8, according to Citigroup. Analysts put the stock on its 30-day negative catalyst watch, saying they expect an operational sales growth miss driven by softness in the soda and snack maker’s North American business. 9. HP Inc. was downgraded to a hold-equivalent neutral from buy at Bank of America as analysts expect upside from its personal computer business to be offset by lower margins in its printer unit. HP shares moved lower Friday. 10. Wedbush Securities’ Dan Ives upped his price target on Salesforce to $325 a share from $315 after positive customer feedback at the software maker’s Dreamforce conference. As we wrote earlier this week for Club members , Salesforce’s new AI offering has jump-started the stock. Sign up for Jim’s Top 10 Morning Thoughts on the Market email newsletter for free (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. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

S&P 500 was looking at a slightly higher open Friday after another record high close. The 10-year Treasury yield was finally lower following a tame August reading on the Fed’s favorite inflation gauge, the PCE price index. With just a couple trading days left in what’s historically the worst month of year, the S&P 500 was heading for its first September gain in five years.

2. Club holding Costco shares were a tad lower after a solid fiscal 2024 fourth-quarter earnings report Thursday night. The wholesale retailer’s long-awaited membership fee increase, which took effect Sept. 1, will have a limited impact until the back of its fiscal 2025 and into fiscal 2026, executives said. We raised our price target on the stock.

3. Best Buy was added to JPMorgan’s analyst focus list after a meeting with the electronics and appliance retailer’s management team. The analysts, who reiterated their $111 price target, called Best Buy a “value idea” to take advantage of the computing replacement cycle along with TV and appliance sales growth as existing home sales improve. That closely mirrors the Club’s investment thesis.

Why Eli Lilly and Palo Alto Networks are both up on news from their competitors

Harsh — Fri, 20 Sep 2024 18:14:26 +0000

Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Markets: The Dow and S & P 500 were lower Friday after surging to record highs Thursday in response to the Fed cutting interest rates by 50 basis points. It’s been a strong week for stocks with the S & P 500 gaining roughly 1.5%. The top performing sectors week to date were energy, communication services, financials and industrials. Only three sectors were on pace for a down week: real estate, consumer staples, and health care. Obesity drugs: New information often sends one company’s stock higher and causes its biggest competitor to fall. Take a look at shares of Club name Eli Lilly . They were trading higher in a soft market after a key competitor in the obesity space reported disappointing Phase 2 trial results. That competitor, Novo Nordisk , said Friday its medicine monlunabant, which is a small molecule oral cannabinoid receptor (CB1) inverse agonist, showed weight loss of about 6% at 16 weeks. This was a big disappointment. The results fell short of Lilly’s lead daily oral GLP-1 orforglipron, which has showed about 8% weight loss in 16 weeks and was well below what Novo previously suggested. Analysts at Deutsche Bank called the trial results underwhelming, adding it “removes the threat of a large well-capitalized, small-molecule competitor to LLY’s orforglipron.” Competition in the obesity space is going to heat up over the next few years, but this disappointment from Novo Nordisk shows how hard it is to make a safe and effective drug. That’s why we’ve long disagreed with the selling of Eli Lilly when a competitor puts out a press release of an early-stage trial. Some medicines will work, some won’t. Some will be highly effective, others won’t move the needle. Some will have safety and tolerability issues. This is the nature of the business. But what we know now is that Eli Lilly’s leadership isn’t going away any time soon thanks to its current lineup of obesity medications, robust pipeline, and massive manufacturing scale. Cybersecurity stocks: In other scenarios, both a company and its competitor can trade up on new news. CrowdStrike shares were on the move higher after the cybersecurity company hosted its annual conference. One of the key revelations from the event was the very little customer churn in the aftermath of the global IT outage it caused in July. Recall, that we initially had a view that competitors like Club name Palo Alto Networks would take advantage of this event to pitch their products. However, we can’t say we are completely surprised to see very few customers leave CrowdStrike. When we looked at Palo Alto’s quarter in August, the results didn’t show a huge swing in market share resulting from the outage. Sure the quarter was good because Palo Alto has a great product and value proposition, but it didn’t suggest a massive departure from CrowdStrike. Both companies are great. So why aren’t Palo Alto shares lower? CrowdStrike’s commentary likely indicated that spending on cybersecurity is still healthy, which benefits both companies. Up next: We’ll see a pickup in earnings next week. Some of the notable reports are from KB Home , which will provide insight into housing, and Micron , which will give us a good look of demand and inventory levels for high bandwidth memory (which feeds into AI chips) as well as cellphones and personal computers. Jefferies , which is always a good preview into the banks, and Club name Costco , which is a good read on consumer spending, are also out next week. (See here for a full list of the stocks in 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. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street.

Costco Wholesale Corp – TheNewsHub

10 things to watch in the stock market Friday including a bullish call on Best Buy

Why Eli Lilly and Palo Alto Networks are both up on news from their competitors