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Fly News Breaks for July 17, 2019
Jul 17, 2019 | 07:59 EDT
Credit Suisse analyst Seth Sigman notes that Advance Auto (AAP) has launched what appears to be the initial phases of its partnership with Walmart (WMT), adding about 5,000 SKUs to the Walmart website. The analyst ultimately believes that, if done right, this could serve as an incremental driver for Advance Auto Parts, benefiting from Walmart's growing online traffic and product offering. That said, more important for the stock in short term will be improving comps after the slow start and weather impact in Q2, along with instilling confidence in the margin outlook, he contends. Sigman has an Outperform rating and $195 price target on Advance Auto Parts' shares.
News For AAP;WMT From the Last 2 Days
Aug 21, 2019 | 13:37 EDT
According to an earlier report, from Bloomberg's Saritha Rai, Amazon (AMZN) "opened its largest campus building globally in the south Indian city of Hyderabad." The Bloomberg story added that the rivalry between Amazon and Walmart (WMT) has helped to fuel the expansion and that the Seattle-based Amazon " is making an ambitious push in India, the last major retail frontier still primarily reliant on small-scale neighborhood and mom-and-pop stores." Reference Link
Aug 20, 2019 | 18:17 EDT
UP AFTER EARNINGS: La-Z-Boy (LZB), up 2.8%... Urban Outfitters (URBN), up 1.4%. ALSO HIGHER: SemiLEDs (LEDS), up 15.9% after receiving an offer from a Chinese investor seeking to acquires 680,000 shares of the company's common stock at $3 per share... New Residential Investment (NRZ), up 2.2% after announcing a $200M share repurchase program. DOWN AFTER EARNINGS: Nordson (NDSN), down 6.3%... Cree (CREE), down 4.1%... Scansource (SCSC), down 0.9%... Jack Henry (JKHY), down 0.9%. ALSO LOWER: Tesla (TSLA), down 1.4% after Bloomberg reported that Walmart (WMT) is suing the car maker's energy operations over solar panel fires.
Aug 20, 2019 | 10:55 EDT
Target (TGT) is scheduled to report results of its second fiscal quarter before the market open on Wednesday, August 21, with a conference call scheduled for 8:00 am EDT. What to watch for: 1. COMPETITION WITH ONLINE RETAILERS: Retailers like Target have been hurt by the trend toward online shopping on sites like Amazon (AMZN) rather than at brick-and-mortar stores. Walmart (WMT) announced this spring that it is stepping up its battle with Amazon and Target by offering one-day delivery without a shipping fee, weeks after Amazon announced a similar offer. As retailers have announced plans to shut over 7,000 stores in the U.S. this year, Target has emerged as one of the winners, Avi Salzman wrote in Barron's in July. Its 1,851 stores have withstood the pressures from Amazon and the ascendancy of online shopping and have benefited from a shakeout in its rivals' stores, he said. In recent years, Target has spent heavily to bolster its web operations and keep prices low, and now, its operating earnings are swinging higher again, Salzman noted. In July, Target held Target Deal Days to compete with Amazon's Prime Day. Following the event, Amazon said Prime Day sales surpassed the previous Black Friday and Cyber Monday combined. Prime members purchased more than 175 million items throughout the event, it said. 2. GUIDANCE: In May, Target forecast Q1 adjusted EPS of $1.52-$1.72, against analysts' current consensus of $1.62, forecasting comp sales growth int he low-to-mid single digit range. The company said it expects Q2 comp growth to be "somewhat slower" than Q1. For fiscal 2019, Target backed its adjusted EPS view of $5.75-$6.05 on comp sales up in the low- to mid-single digits. At the time, the consensus estimate for FY19 EPS was $5.83, but it has since moved higher to $5.93. Cleveland Research analyst Scott Bender said his checks suggest Target's sales seemed to improve in July, but not by quite enough to offset softer trends earlier in the quarter. The analyst now sees Q2 comps as likely to miss consensus and come in on the lower end of Target's guidance. Baird analyst Peter Benedict said he still sees good support for Target's Q2 comp expectations and he remains comfortable with his and the Street's estimates. The analyst sees several drivers which can help sustain solid top-line momentum and with an improved follow through, he believes guidance remains secure. Deutsche Bank analyst Paul Trussell said he believes a "robust" Q2 earnings report is possible, driving Target toward its first double-digit two-year stack comp since 2006. 3. RECENT INITIATIVES: Target is expanding its plans to remodel supercenters and open smaller stores in cities. In April, Target introduced Everspring, a new household essentials brand comprised of more than 70 household essentials items that include ingredients and components that are derived from plants or use other renewable materials. Earlier this week, Target announced the introduction of Good & Gather, its largest owned food and beverage brand. Target said the flagship brand will offer a wide range of food and beverage products "that prioritize taste, quality ingredients and ease, at a great value." Good & Gather will be available in stores and online on for same-day delivery beginning September 15.