My top 10 things to watch Tuesday, Feb. 28
1. Will there be window-dressing on Wall Street? It’s the final day of a tough month, with the Dow, the S&P 500 and the Nasdaq looking for back-to-back gains. All three benchmarks are tracking for a negative February. After a strong start to 2023, only the Dow is down year to date. But January’s gains have been fading.
2. Target (TGT) exceeded estimates on adjusted fourth-quarter earnings-per-share (EPS) for the first time in a year. Revenue for the holiday quarter also beat. However, the retailer warned on Q1 and full-year. “We know inflation is still high. It’s been very stubborn,” CEO Brian Cornell told CNBC on Tuesday. Inventory at end of quarter down 3% from 2021. Inventory in discretionary categories down 13%. In retail, we like and own Costco (COST), which reports quarter after the bell Thursday.
3. First 100 days since the return of Bob Iger as CEO, Disney (DIS) shares down all the way from 2023 high of $118 earlier in the month to around $100 as of Monday’s close. What will Iger do? Does he have a plan beyond what he talked about in that Feb. 9 interview on CNBC? Iger only wants to stay for two years. Not a lot of time to execute his strategy and search for a successor.
4. New TikTok ban bill is set to advance in Congress. White House releases new rules for a ban on China’s ByteDance-owned TikTok that applies only to federal government-owned devices. I say trouble for Tiktok is more of a reason to buy Club holding Meta Platforms (META).
5. Goldman Sachs (GS) CEO David Solomon told CNBC in an interview ahead of Tuesday’s investor day that the firm did not execute well on its push into consumer banking. Asset management and wealth management growth engine for the bank, he added. My takeaway: Lessons learned are not fully learned. Instead of Goldman, we like and own Morgan Stanley (MS).
6. Zoom Video (ZM) growth is slow but profitability is strong because of the layoffs, which were successful. Price target raised at Piper Sandler to $78 per share from $75.
7. Ahead of Tuesday’s investor day, Chevron (CVX) increases its share buyback target for 2023 to $17.5 billion. Makes a further commitment to renewals. CEO Mike Wirth joins me on “Mad Money” later. We’ve got four oil stocks in the portfolio: Devon Energy (DVN), Coterra Energy (CTRA), Halliburton (HAL) and Pioneer Natural Reseources (PXD).
8. Workday (WDAY): It was a very good quarter. Management sees “durable demand for our solutions, as organizations of all sizes continue to prioritize finance and HR modernization.” Stock selloff seems a little silly. Some price targets raised. Others not.
10. Citi downgrades Dick’s Sporting Goods (DKS) to neutral from buy; trims price target $3-per-share to $140. Margin worries will be outlined in March.
(Jim Cramer’s Charitable Trust is long COST, DIS, META, MS, DVN, CTRA, HAL, PXD. See here for a full list of the stocks.)
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