Costco Stock Will Only Look Hotter as Elections Near

/ / Consumer Discretionary /

Costco Wholesale shares are looking very attractive to investors as retail spending remains tight, and that sentiment is probably going to intensify as spending becomes even more volatile heading into election season, UBS analysts say in a research note. “As this takes place, Costco’s share gains will look even more compelling and the stock will sustain its premium valuation,” the analysts say. The market currently has little appetite for market share losers, and Costco is positioned to keep scooping up market share as macroeconomic strains have more consumers seeking out warehouse memberships to maximize their spending power, the analysts say.

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Costco Wholesale’s Fiscal Q3 Results to Highlight Strong Business Model, UBS Says

/ / Consumer Discretionary /

Costco Wholesale’s (COST) upcoming fiscal Q3 financial results are expected to emphasize the strength of its warehouse club business model, UBS Securities said in a note. The firm noted that Costco has consistently increased foot traffic by mid-single digits regardless of the macroeconomic backdrop. “With such strong and consistent growth in footsteps, [Costco] offers exactly what the market is looking for right now, given that retail investors have very little appetite to be exposed to market share losers and are increasingly favoring market share winners,” UBS said in its note Monday. UBS said new member growth, increasing traffic and new store openings likely helped the company grow its net sales by 8%, while earnings per share are estimated at $3.75, above the $3.71 consensus, for fiscal Q3, the firm added. Costco is scheduled to release fiscal Q3 results Thursday. “We believe [Costco] can continue to appeal to a cash strapped

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Google Buys Minority Stake in Walmart-Backed Flipkart for $350 Million

/ / Technology /

Alphabet’s (GOOG, GOOGL) Google is purchasing a minority stake worth $350 million in Indian e-commerce company Flipkart, valuing the firm at $37 billion, Reuters reported Friday, citing a source with direct knowledge of the matter. Flipkart announced Friday, as part of its latest funding round led by Walmart (WMT), that Google will become a minority investor pending regulatory and customary approvals from both parties. “Google’s proposed investment and its Cloud collaboration will help Flipkart expand its business and advance the modernization of its digital infrastructure to serve customers across the country,” Flipkart added. “As a people-led, tech-powered omnichannel retailer helping people save money to live better, Walmart and Flipkart look forward to welcoming Google as a minority investor,” Walmart told MT Newswires.

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Salesforce Makes Comeback With Margins, Growth Improvements, Wedbush Says

/ / Technology /

Salesforce (CRM) faced challenges but “pulled a comeback story,” with improved margins and growth prospects for fiscal 2025, Wedbush said in a note Tuesday. The company had been facing criticism for lackluster growth and margins for some quarters now, but it has turned around with improving performance. Based on its checks, the brokerage now expects another solid quarter and expects CEO Marc Benioff and the management to overcome the negative sentiment. “Investors will be closely watching [Salesforce] results and commentary from Benioff to further gauge the enterprise demand environment for software and overall appetite for the company’s freshly rolled out AI strategic roadmap with the AI Revolution on the doorstep for the tech world.” Cross-selling was strong this quarter, especially with Mulesoft deals. Despite market challenges, integration of Slack, a cloud-based team communication platform, into the company’s suite shows promise for collaboration deals, Wedbush said. Cost-cutting efforts are slowing down,

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Marvell Technology Q1 Earnings Preview: Investors ‘Particularly Interested’ In Company’s AI Business, Second Half Growth

/ / Technology /

Semiconductor company Marvell Technology (NASDAQ:MRVL) is set to report first-quarter financial results after market close on Thursday. Earnings Estimates: Analysts expect Marvell to report first-quarter revenue of $1.18 billion,. The company reported $1.32 billion in revenue in last year’s first quarter. Marvell has exceeded analysts’ revenue estimates in eight of the last 10 quarters, including the past five consecutive quarters. Analysts expect the company to report first-quarter earnings per share of 25 cents, compared to 31 cents reported in last year’s first quarter. The company has beaten analysts’ earnings per share estimates in seven of the last 10 quarters, with the fourth quarter results coming in-line with estimates. Marvell previously guided for first-quarter revenue to be $1.15 billion, plus or minus 5%. The company also guided for adjusted first-quarter earnings per share of 23 cents, plus or minus 5 cents per share.

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McDonald’s Struggles With Lowest Sales Growth Since 2020, Sluggish Trends to Continue in Q2, BofA Says

/ / Consumer Discretionary /

McDonald’s (MCD) saw its lowest quarterly same-store sales growth in Q1 since H1 of 2020 and real-time spending data indicate the slow trend will continue in Q2, BofA Securities said in a note Tuesday. The company has been facing declining customer traffic since Q3 2023 and is now lagging peers like Burger King and Wendy’s (WEN), highlighting issues with difficult comparisons and missed execution, BofA said. McDonald’s $5 combo deal aims to address the lack of a national value menu, but overall prices also need to moderate as the company’s cumulative price increase of 20% since 2022 surpasses both Burger King and Wendy’s, the analysts said. BofA said it sees the $5 combo as an urgent move and a temporary measure before introducing a more permanent value offer. The firm lowered the price objective on McDonald’s stock to $288 from $302 and reiterated its neutral rating.

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Nvidia Shares Help Lift Nasdaq — WSJ

/ / Technology /

By Sam Goldfarb Nvidia shares surged again Tuesday, adding to their outsized recent gains on an otherwise lackluster day for stocks. Still riding high after another blockbuster earnings report last week, Nvidia’s stock climbed 7%, bringing its month-to-date gain to 32% and year-to-date gain to 130%. News that Elon Musk’s xAI had raised $6 billion in private financing provided an extra boost to Nvidia shares, highlighting the frenzy of artificial-intelligence investment that has turned the chip maker into a market behemoth. Shares of other chip producers also rose, helping lift the tech-heavy Nasdaq Composite 0.6%. The S&P 500 ticked up less than 0.1% and the Dow Jones Industrial Average dropped 0.6%. Overall, investors are “digesting what was a pretty good earnings season, ” said Ed Clissold, chief U.S. strategist at Ned Davis Research. With most S&P 500 companies having reported their first-quarter results, earnings are on track to climb 6%

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Google Buys Minority Stake in Walmart-Backed Flipkart for $350 Million

/ / Technology /

Alphabet’s (GOOG, GOOGL) Google is purchasing a minority stake worth $350 million in Indian e-commerce company Flipkart, valuing the firm at $37 billion, Reuters reported Friday, citing a source with direct knowledge of the matter. Flipkart announced Friday, as part of its latest funding round led by Walmart (WMT), that Google will become a minority investor pending regulatory and customary approvals from both parties. “Google’s proposed investment and its Cloud collaboration will help Flipkart expand its business and advance the modernization of its digital infrastructure to serve customers across the country,” Flipkart added.

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Nike Now Tracking Toward Fiscal Fourth-Quarter Revenue Growth, RBC Says

/ / Consumer Discretionary /

Nike (NKE) is now positioned for slight fiscal fourth-quarter revenue growth while its fiscal 2025 guidance may imply a back-half acceleration in sales, RBC Capital Markets said Friday. The brokerage is guiding for sales of $13.01 billion, implying growth of 1% on a reported basis and 2% at constant currencies. That’s up from RBC’s prior sales estimate of $12.53 billion, which implied a decline from the $12.83 billion Nike reported the year earlier. The average analyst estimate in a Capital IQ survey is for $12.91 billion. Direct-to-consumer sales are expected to rise 1% in constant currency terms to $5.67 billion while wholesale revenue is seen climbing 3% to $7.21 billion, according to the report. Wholesale should benefit from a “significant easing” of year-over-year comparisons, according to RBC analyst Piral Dadhani. For fiscal 2024, RBC is forecasting revenue of $51.76 billion, up from its prior view of $51.28 billion and above

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Nike’s Underperformance Linked to Earnings Downgrades, Future Strategy Crucial, RBC Says

/ / Consumer Discretionary /

Nike’s (NKE) stock has underperformed peers due to earnings downgrades and lower valuations, and relies on a return to positive revenue growth, which is not expected until early 2025, RBC Capital Markets said in an earnings preview Friday. The firm said Nike’s current valuation is more attractive and will remain stable until management reveals the company’s future product plans and strategies. Further details of product range transition, including timing, new products and category strategy, will be important, according to RBC. RBC said it expects revenue to grow 1% to $13 billion and diluted earnings per share of $0.72 for fiscal Q4, the results of which are scheduled for release in late June. For fiscal year 2024, RBC said it now expects a 1% revenue growth because of foreign exchange translation. For fiscal year 2025 organic revenue guidance, RBC said it lowered its estimate to 2% growth from 4%. “Nike’s de-rating

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Intuit Inc. (NASDAQ:INTU) Q3 2024 Earnings Conference

/ / Technology /

The following is a summary of the Intuit Inc. (INTU) Q3 2024 Earnings Call Transcript: Financial Performance: Intuit reported Q3 2024 revenue of $6.7 billion, up 12% from the previous fiscal year. GAAP operating income grew by 12% to $3.1 billion, and non-GAAP operating income saw an 11% increase to $3.7 billion. Earnings per share improved significantly, with GAAP diluted earnings per share growing 14% to $8.42 and non-GAAP diluted earnings per share witnessing an 11% increase to $9.88. Revenue from the Consumer group rose by 9% to $3.7 billion, and the Small Business and Self-Employed group revenue spiked by 18%. Business Progress: Strong momentum continues across the company, with a committed focus on the strategy of being a global AI-driven platform for consumers and small businesses. There has been growth in core business areas, with QuickBooks Online accounting revenue witnessing a 19% increase in Q3. The company plans on

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