HAPPY WEDNESDAY TO THE STREET
Consumer prices just hit a three-year high of 4.2%, and at least one key market observer loves it.
President Trump's review came back glowing: "I love the inflation." He says prices will "come down like a rock" once the Iran war ends, crediting millions of barrels of oil the US has quietly been "taking out," a mission his own Energy Secretary said he hadn't heard of.
Then again, they do say love is blind…
🟥 | US stocks slumped today as consumer price inflation cracked 4% for the first time in three years, and US-Iran relations saw a series of setbacks.
📈 | One Notable Gainer: No new logo, no problem. Cracker Barrel (CBRL) soared more than 20% after raising full-year revenue and EBITDA guidance.
📉 | One Notable Decliner: Super Micro Computer (SMCI) plunged on plans to raise $7B through equity sales.
— Brooks & Cas
MARKET SNAPSHOT
S&P 500 Heatmap. Credit: Unusual Whales
HOW WILL JUNE CPI MOVE MONTH-OVER-MONTH?
May's CPI headline inflation rate of 4.2% year-over-year was the highest annual print in three years.
However, energy prices up 23.5% from a year ago did most of the damage, with core inflation stayed tame at 2.9%. So the Fed will likely sit on its hands June 17.
The real bet, then, is whether June's print cools off, or whether $85 oil keeps the burner on.
Market Movers
CASEY’S, OLD DOMINION, ROBINHOOD
📈 | Casey's General Stores (CASY) beat fiscal Q4 estimates on rising fuel margins.
📉 | Old Dominion Freight Line (ODFL) slid after Amazon (AMZN) opened its less-than-truckload shipping service to outside companies.
📈 | Robinhood Markets (HOOD) jumped after May platform assets rose 48% year over year.
Tomorrow's Trade Idea, Today
BOWL MARKET
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Greens and Gains
UBS analyst Dennis Geiger upgraded Mediterranean fast-casual chain CAVA, calling it a rare breed: a real growth story in a sector starved for them.
First-quarter same-store sales rose 9.7% year-over-year, beating expectations, and shares climbed today on the news. But Geiger says there’s still a ways to go.
1,000 Locations to Go
The analyst credits a differentiated menu, multiple sales catalysts, and healthy returns on new restaurants for his conviction.
Cava plans to open 1,000 more locations by 2032 and just announced a push to hire 2,500 new team members in 2026. Geiger believes those labor investments will develop the leaders needed to support the buildout.
Add menu innovation, marketing muscle, and a strong pull with health-conscious diners, and UBS sees sustained outsized growth without the overhang concerns dogging select peers.
Bowl Half Full
Shares remain well below their December 2024 all-time highs, but they have rallied hard off last November's lows and sit firmly in the green this year.
Geiger argues that kind of growth, minus the baggage, should help the stock re-rate higher. UBS thinks it's time to dig in.
Do you own any shares of Cava Group (CAVA)?
OVERHEARD ON THE STREET
⚖️ | Sen. Elizabeth Warren called on the SEC to delay SpaceX's IPO due this Friday, citing valuation and governance concerns.
🏛️ | Trump signed a $70B bill funding ICE and Border Patrol through the end of his term.
🚁 | Trump also said the US will launch new strikes on Iran after an Iranian drone downed a US Apache helicopter near the Strait of Hormuz.
🚗 | Honda (HMC) recalled more than 880,000 vehicles over rear subframe corrosion that can cause suspension failure.
🚀 | SpaceX's IPO has drawn more than $250B in investor demand, roughly four times oversubscribed ahead of tomorrow’s pricing.
TUESDAY’S POLL RESULTS
Do you own any shares of Tapestry (TPR)?
▇▇▇▇▇▇ 🐂 Yup, I’m holding
▇▇▇▇▇▇ 🐻 Nope, not interested
▇▇▇▇▇▇ 👀 No, but I’m interested
And, in response, you said:
🐻 Nope, not interested — “Fashion trends and brands gone and go unpredictably. Maybe good for traders but not for long term investment.”
