On today’s episode of Free Lunch, Ryan McQueeney recaps Ford’s job cut, earnings from Bed Bath & Beyond, and holiday sales results for Macy’s and Kohl’s. Later, he chats with Dave Bartosiak about the state of auto stocks and what to expect from Q4 earnings season after several key guidance cuts.
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Free Lunch is presented by Zacks Investment Research. It is streamed live, four times per week, and features breaking news and analysis from Zacks strategists. Free Lunch is available on YouTube, Twitter, and other major streaming platforms.
Stocks were mixed in morning trading today, as investors had plenty of varied news to digest on the back of the S&P 500’s longest winning streak in months.
Notably, Ford F announced a major restructuring plan for its European division. The U.S. auto giant is hoping that it can achieve a 6% operating margin on the continent, and to do that, it will slash thousands of jobs and reconsider a variety of operations. The move comes after rival General Motors GM sold off some its European units.
Meanwhile, the retail sector was buzzing today on the release of earnings reports and holiday sales results. Bed Bath & Beyond BBBY surged in early trading after impressing in its latest quarter, beating EPS estimates, and announcing that it was ahead of long-term financial targets. On the other hand, shares of Macy’s M and Kohl’s KSS were sharply lower after the department stores announced their November and December sales figures.
On the first half of today’s program, Ryan recaps the key facts from each of the above stories. Later, he is joined by Dave Bartosiak to further discuss the news.
With the disappointing guidance of retailers such as Macy’s and Kohl’s, as well as Apple AAPL and American Airlines AAL, in mind, Ryan asked Dave whether investors should be worried about the upcoming Q4 earnings season.
Dave argued that he expects the season to be a “kitchen sink” quarter, wherein companies will try to flush out all of their write-offs and trade war excuses at once in order to better manage expectations going forward. This could create near-term pressure for share prices, but it’s also possible that Wall Street was pricing in this type of quarter in December, according to Dave.
Dave also chimed in on the state of the U.S. auto industry after Ford’s new announcement. In Dave’s view, Ford’s European restructuring is a symptom of the company’s ongoing transformation into a future-minded brand. This forward-looking mindset is new for Ford, and with that comes uncertainty and growing pains, Dave said.
Want to hear more about Dave’s expectations for earnings season and the near-term future of Ford? Make sure to check out today’s episode of Free Lunch!
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