#retailsector #wallmartstock #homedepotstock #Investingtips #Investinginspiration
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The Market Reporters from Hugo Investing analyze the retail sector.
About the Retail earnings
TUESDAY WALMART:
Walmart also dropped 6,8% world's largest retailer.
Missing expectations
Rising costs took a bite out of the bottom line
Earnings for 1.30 per share on an expectation of 1.48
Positive: sales grew with 3% more than expected
Updated their guidance to reflect supply chain costs and inflation pressure
By 2023 they expect a 4% increase in sales
Earnings per share are expected to decrease or
A year ago people were still receiving stimulus checks so it is sort of double pain for the consumers.
Walmart targets in general lower-income shoppers compared to Target
Walmarts earnings miss is cause for concerns
Home Depot's strong figures
Earnings up 6% beating all estimates
Revenue climbed 3,8% head of views for a 2% fall
They managed to leverage their brick-and-mortar sales with expanding e-commerce sales
Shoppers have not pulled back
Mid-single digits are up about 3% improving prior guidance
The stock is 30% down for the year
The pandemic boom in home renovations has eased and increasing interest rates will have their impact on the housing sector.
Also, the companies will be confronted with higher driving costs and shortage of materials.
WEDNESDAY TARGET
Shares fell more than 24% and they triggered a big sell-off in the market
Earnings miss, expected was 3.07 per share and they only made 2.19 a share last year they made 3.69 per shares.
a 52% drop in profit
Overall sales were up 4%
People keep buying food but not the higher tickets such as TV’s and exercise equipment.
As many other retailers Target needed to boost hourly pay to attract workers this put a serious dent into earning.
They also did not anticipate such a magnitude in shift after stimulus being brought back
Next to Target other retailers also fell:”
Kohl’s – 11%
Best Buy
Urban Outfitters
Dollar General
WHY IS THIS SECTOR SO IMPORTANT:
Why as retail earnings confirm investors biggest fears about consumers 70% of the US GDP is related to consumer spending
Targets miss showed that Walmart wasn’t an exception
Weak results are not only an e-commerce problem
Spending on discretionary items has fall consistently
Consumers with higher incomes are pulling back in reaction to inflation
NEXT BIG CRASH:
90% of global grain trade in hands of four corporations
Much of the trade passes through vulnerable chokepoints, Turkish Straights etc.
Locally food has become more diverse but globally less diverse wheat, rice, maize and soy account for 60% of the calories grown by farers
Network of density – cascading failure comes nearer
Food production has to change and needs to be more diversified
Hugo Investing is a dedicated team with a passion for investing. We are the former BinckBank Spain team with a combined experience of over 60 years in assisting private investors.
The information in this video should not be interpreted as individual investment advice. Although Hugo compiles content from reliable sources, Hugo cannot guarantee that the information is accurate, complete, or current. The use of information from this video without prior verification or advice is at your own risk. We recommend that you only invest in products that match your knowledge and experience and do not invest in financial instruments whose risks you do not understand.
