HAPPY WEDNESDAY TO THE STREET
Good news: inflation isn't as bad as we thought, after revised data showed prices climbing more slowly than first reported. Bad news: the war in Iran kept August's PCE reading stubbornly high, while Americans pushed their savings rate to a nearly four-year low. Yet spending posted its biggest jump in over a year, so the plan seems to be simply outspending inflation.
🟨 | US stocks were mixed as cooler inflation boosted tech, while strong jobs data kept rate-hike expectations alive and the Dow lagged.
📈 | One Notable Gainer: United Therapeutics (UTHR) surged after a court found Liquidia infringed on its patent.
📉 | One Notable Decliner: Liquidia (LQDA) plunged after a court ruled it infringed a United Therapeutics patent.
— Brooks & The Street Sheet Team
MARKET SNAPSHOT
Market Movers
MODERNA, FORMFACTOR, JABIL
📉 | Jabil (JBL) slid despite fiscal Q4 results and guidance that beat estimates.
📈 | Rogers (ROG) issued better-than-expected full-year earnings guidance.
📉 | Cal-Maine Foods (CALM) reported a wider-than-expected fiscal Q1 loss.
Tomorrow's Trade Idea, Today
HITTING THE BULLSEYE
Stock Spotlight
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Aisle Be Back
Target's comeback tour just picked up another fan. HSBC analyst Joe Thomas upgraded the retailer to Buy, pointing to a standout second quarter.
Comparable sales rose 3.8%, and store-originated sales gained 2.7%, with steady demand across income groups. Beauty, food and beverage, and household essentials all staged notable recoveries.
Refund Season
Thomas believes Target could comfortably beat his full-year forecast, since his estimates require only modest second-half growth.
Washington may help, too. With the Supreme Court striking down a large portion of President Trump's tariffs, Thomas flagged a potential $994M refund for the retailer.
Target is also plowing more than $2B into upgrading its stores to lure shoppers back through the doors.
Minority Report
Most of Wall Street isn't buying it yet. Of the 39 analysts covering the stock, 24 rate it a Hold and three say Underperform.
Shares have rallied hard this year after four straight annual declines, putting the stock on pace for its best year since 2019. Consensus is still browsing. HSBC is already at the register.
Do you own any shares of Target (TGT)?
OVERHEARD ON THE STREET
💊 | Eli Lilly (LLY) said its experimental combo obesity regimen beat high-dose tirzepatide on weight loss in a mid-stage trial.
⚖️ | President Trump's Section 301 tariffs, covering 99.4% of US imports, face a new trade court challenge.
🤖 | Reddit (RDDT) is ending RSS feeds and public API access, citing AI scraping.
🚗 | The Detroit 3 are expected to hit their lowest US market share on record in Q3.
🚁 | DoorDash (DASH) unveiled its own custom-built delivery drone, launching pilots in Northern California.
TUESDAY'S POLL RESULTS
Do you own any shares of Netflix (NFLX)?
▇▇▇▇▇▇ 🐂 Yup, I’m holding
▇▇▇▇▇▇ 🐻 Nope, not interested
▇▇▇▇▇▇ 👀 No, but I’m interested
And, in response, you said:
🐂 Yup, I’m holding — “I am holding Netflix because I believe: 1. Advertising is still in the early innings. 2. Margins can continue expanding. 3. Management remains among the best operators in media. 4. The stock is less than an uncomfortable percentage of my portfolio.”
🐻 Nope, not interested — “I keep more of my money in my pocket; I do not even watch Netflix!”
👀 No, but I’m interested — “Curious about affordability. Sooner or later, people are going to have to choose. Right now, I’m not sure I’d keep a Netflix subscription if I were forced to trim my streaming budget.”
Disclaimers (if applicable)
