My top 10 things to watch Friday, May 23
1. President Donald Trump said on social media today that Apple must pay at a 25% tariff on iPhones not made in the United States. Most iPhone manufacturing is out of China. Apple has been moving more and more production to India. The starting price for an iPhone 16 Pro is $1,000. Analysts estimate a U.S.-made iPhone would cost quite a bit more. Apple is the Club stock that I am most concerned about.
2. At the same time, Apple raised iPhone trade-in prices in China so customers could get more money for new devices. The move to spur demand in the world’s second-largest economy comes as Apple faces tougher competition from Huawei and other domestic players.
3. Wall Street was headed for a sharply lower open today on Trump’s Apple comments and his saying he is “recommending a straight 50% Tariff on the European Union.” The president said trade talks with the EU have stalled. Meanwhile, the U.S. and China keep the lines of communication open on trade after earlier this month pausing their triple-digit tariffs on each other’s imports.
4. Ross Stores shares sank 13% this morning after the off-price retailer withdrew full-year guidance due to “macroeconomic and geopolitical uncertainty.” Ross, which did best estimates with first-quarter earnings and revenue, also mentioned the stressed consumer. Rival TJX Companies, a Club holding behind T.J. Maxx, reported a respectable Q1 and managed to maintain its full-year outlook.
5. Deckers Outdoor shares plunged more than 19% this morning despite a quarterly earnings beat and a slight revenue beat, too. The company behind UGG and Hoka decline to release full-year guidance due to macro uncertainty. Decker signaled current-quarter guidance below estimates. Lots of Wall Street analyst price cuts and a downgrade to hold from buy at Telsey.
6. Intuit shares jumped nearly 7% this morning after better-than-expected quarterly earnings and revenue. The TurboTax and QuickBooks company also saw truly terrific numbers for its Credit Karma business. Intuit’s financials were the star among the companies that reported last night. Lots of analyst praise.
7. Barclays raised its Ralph Lauren price target to $321 per share from $260. Finally, some recognition for a terrific set of numbers and the iconic fashion brand is the king of social. Investors were not impressed, selling the stock down 2.5%. Many other analysts also boosted their PTs.
8. Wedbush said the “dark chapter” for Tesla is over, boosting it price target to $500 per share from $350. I agree with this call. The analysts feel that Elon Musk is once again committed running Tesla and focusing on the future of self-driving electric vehicles and robotics.
9. Citi cut its price target on Club name Salesforce to $310 per share from $335 and kept neutral. The analysts see business slowing down. I told Club members on this week’s Monthly Meeting Salesforce is one of the portfolio stocks that I am worried about. Not to mention ServiceNow is taking a direct shot at Salesforce by ramping up its customer relationship management platform.
10. Okta is still a Wall Street as demand for the company’s identity protection software remains strong. Zscaler similarly is loved by analysts. Both can do no wrong. I like CrowdStrike.
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