My top 10 things to watch Thursday, Feb. 9
1. The Disney (DIS) magic is back? Bob Iger wastes no time putting turnaround plans in place after returning as CEO. Solid quarter at Club holding. Divisional reorganization. Cost cuts, including 7,000 layoffs. New focus on profitability and creativity. I liked what I heard so much from Iger that I believe activist investor Nelson Peltz should be satisfied. He doesn’t need to be on the board.
2. The Dow Jones Industrial Average, the S&P 500 and the Nasdaq are set to open higher on Thursday. Nearly 6% premarket jump in Dow stock Disney leading the way, one day after a pause in Wall Street’s 2023 rally.
3. The outlook for Club holding Wynn Resorts (WYNN) hasn’t been this good since the Covid pandemic started. Strong quarter. U.S. operations … Las Vegas, even Boston … emphasized more than Macao in some ways. China starting to kick in. The stock has been up, up, up since November. We have been in Wynn ahead of the China reopening. Credit Suisse and Barclays boost their price targets.
4. Salesforce (CRM) five activists now? Third Point joins the fray. Layoffs and board shake-up already announced after high-level executive departures, including co-CEO Bret Taylor. I’ve been saying more needs to be done to right the ship at this Club holding.
5. PepsiCo (PEP) delivers a blowout quarter, with great organic growth. The stock has been in the Club Bullpen, our watch list, for a while now. This kind of stock has fared poorly in this market. PepisCo shares up more than 1.5%.
6. Mattle (MAT) shares getting crushed by more than 10%. Big quarterly miss on both top and bottom lines. The Grinch who stole Christmas playing out.
7. Yum Brands (YUM): Citi says buy. Barclays says hold. Both raise price targets on a very good quarter at the company behind Taco Bell, KFC and Pizza Hut. Going out to eat is still solid, witness Chili’s and Maggiano’s owner Brinker International (EAT). Chipotle Mexican Grill (CMG) is still fast food casual.
8. RL (RL): Amazing quarter. Ralph Lauren best of the apparel; spending on marketing working. Wealthy are spending.
9. Capri (CPRI) … Versace, Jimmy Choo and Michael Kors brands … multiple Wall Street firms cut their price target. But no one actually downgrades the stock from a buy rating. That’s a little crazy as it was a really bad quarter in many, many ways.
10. e.l.f. Beauty (ELF) gets a price-target hike to $82 per share from $64 at Piper Sandler; keeps overweight (buy) rating. Such a good story. In beauty, we like and own Estee Lauder (EL).
(Jim Cramer’s Charitable Trust is long DIS, WYNN, CRM, EL. See here for a full list of the stocks.)
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