Caterpillar stock, Norwegian Cruise Line Q3 outlook, Tupperware shares rally: Top stocks

Caterpillar shares climb to a record high after topping second-quarter earnings estimates. Norwegian Cruise Line's stock drops despite posting an earnings beat, citing a disappointing third-quarter profit outlook amid a boom in summer travel demand. Lastly, Tupperware joins the ranks of meme stock trades as its shares rally on retail investor trends.

Video Transcript

- Let's take a look at some of the big movers of the day. First up, shares of Caterpillar jumping to a record high in today's session after beating estimates on both the top and bottom line. The company also saying that its full year operating margin will come in at the top end of its previous guidance. We saw the excitement, Akiko, in shares on the heels of this news. And we know many investors look at Caterpillar as a bellwether here, not only for the US economy, but really for the global economy. So the fact that demand has remained resilient here, obviously a strong sign for the second half of the year and going forward.

- Yeah, Seana. Certainly a broader commentary on this macro environment that we're seeing. I mean, we've been hearing so much about the construction boom. And that is really reflected in the numbers that we got from Caterpillar today. We're talking about not just new homes but industrial construction projects that are taking place. Non-residential construction accounting for a majority of the company's equipment sales. Part of that is what we've seen coming through from DC, whether it's the Infrastructure Bill, CHIPS Act, the IRA. We've heard so much about those investments taking shape.

The one thing that I thought was interesting though is that the company talking about the slowdown they're continuing to see in the Chinese market. Remember the CEO back in April said that total share of sales would be about 5% to 10% below normal expected range. And then today, we heard the company say yet again that they expect it to be even slower. So sort of interesting when we're trying to get a better gauge of what that rebound or lack of rebound is looking like over in the Chinese market.

Well, Norwegian Cruise Line shares sinking today despite beating Wall Street's estimates. But its third quarter guidance that's hitting the stock today missed estimates for what is supposed to be the best three months for cruise operators. And you see that stock down more than 12% in the session. Norwegian now expecting adjusted earnings of $0.70 a share in the third quarter. And Seana, this has got to be disappointing because we've been talking so much about the pent up demand that customers increasingly are willing to spend on this. That guidance just didn't come in where investors wanted it to be.

- It wasn't. And Akiko, this almost seems like a reality check here for investors. But the bar though was set very high. We've gotten very strong results from their two largest rivals. So investors had very high expectations going into these results. So any sort of disappointment. I think we were prepared to some degree to see some pressure on the stock. But again, a big drop today with shares closing off just about 12%.

When you take a look at the numbers, it wasn't too bad for the quarter revenue did beat the Street's expectations up 86% year over year to just over $2.2 billion. But again, that bar set very high from the rivals here at Norwegian, falling below what the Street was hoping to see. Stifel was out with some reaction commentary today, saying that today's weakness, they view it actually as a buying opportunity though because they believe expectations are way too elevated for this company when compared to Royal Caribbean. So again, they're seeing a little bit of a buying opportunity here. But across the board, there was so much expectation for that very, very strong, resilient consumer, very strong demand. So Norwegian just falling a bit short there.

Let's also take a look at Tupperware. This stock has certainly been on a tear in recent days. Shares surging another 25% today. The gains reminiscent of that meme stock mania that swept the markets in recent years. And the reaction that-- the action, I should say, in general, that we've seen in Tupperware really proving the fact that the meme trading frenzy remains alive and well, Akiko.

Short interest is the highest level that we've seen in more than a year. And this is a stock that's been trending on some of those retail investor favorite sites like StockTwits, like Reddit, helping to explain why there's so much interest in the name that Tupperware has warned that they could maybe potentially not be around here for much longer. So the investor interest, you got to kind of second guess and question where this is coming from.

- Yeah. Among the top traded stocks today in this session, this is a company that back in April said it was near bankruptcy. We're talking about shares at roughly $1 at the beginning of July. And here we are more. The stock price has more than quadrupled. Seana, I think I have stopped trying to explain some of this meme trade. But it is interesting to see what the excitement is. I mean, I don't know.

The other name, by the way, that's also trading, among the most traded today. Yellow, which is a trucking company. I mean, there's a number of those stocks that were starting to sort of percolate through this meme frenzy. But I mean, we'll see if it sticks.

- If you buy in, you got to be prepared to lose it all, at least with names like that.