Chart of the Day: From Down and Out to Off the Mat
Q3 2024 Earnings Conference Call Recaps: TreeHouse Foods (THS)
Bespoke’s Conference Call Recaps use AI to summarize lengthy earnings calls. The commentary below is AI-generated and then edited by Bespoke for quality control. As always, none of these summaries should be construed as recommendations to buy or sell any securities, and investors should do their own research and/or consult with a financial professional before making any investment decisions.
Our latest recap available to Bespoke subscribers covers TreeHouse Foods’ (THS) Q3 2024 earnings call.
TreeHouse Foods (THS) is a private-label food manufacturer specializing in packaged and ready-to-eat products like snacks, beverages, and meal components. Some of THS’s largest partners include major grocery retailers such as Walmart and Albertsons. The company is positioned well for the growth of private-label groceries but saw net sales fall slightly below guidance this quarter because of short-term weakening consumer demand and disruptions from Hurricane Helene. On the contrary, THS highlighted $20 million in supply chain savings. Private-label products continued to gain share but from a shrinking market, as major grocers reported declines in shopper traffic. A frozen griddle product recall impacted revenue and will keep a facility offline until Q1 2025. The company is focused on $250 million in supply chain savings by 2027, leveraging procurement efficiencies and improved logistics. THS missed across the board and cut guidance, resulting in a 14.3% drop for THS on 11/12…
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Q3 2024 Earnings Conference Call Recaps: Tyson Foods (TSN)
Bespoke’s Conference Call Recaps use AI to summarize lengthy earnings calls. The commentary below is AI-generated and then edited by Bespoke for quality control. As always, none of these summaries should be construed as recommendations to buy or sell any securities, and investors should do their own research and/or consult with a financial professional before making any investment decisions.
Our latest recap available to Bespoke subscribers covers Tyson Foods’ (TSN) Q4 2024 earnings call.
Tyson Foods (TSN) is a major player in protein with a wide range of beef, pork, chicken, and prepared foods under well-known brands like Tyson, Jimmy Dean, and Hillshire Farm. As one of the largest meat processors in the world, the company provides insights into consumer demand trends, agricultural cycles, and global food supply dynamics. This quarter, TSN reported its best quarterly adjusted EPS in two years and annual AOI (Adjusted Operating Income) that nearly doubled last year’s results. Key drivers included a $1.1 billion turnaround in chicken profitability and its best performance in prepared foods since 2018. Beef remains challenged by compressed spreads and tight cattle supplies, though innovations in value-added products like Restaurant Style Crispy Wings available in various flavors, and Razorback-shaped chicken nuggets to celebrate the University of Arkansas, provide optimism. As higher prices helped TSN to earnings beats, shares rose 6.6% on 11/12 in reaction to the report…
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Q3 2024 Earnings Conference Call Recaps: Shopify (SHOP)
Bespoke’s Conference Call Recaps use AI to summarize lengthy earnings calls. The commentary below is AI-generated and then edited by Bespoke for quality control. As always, none of these summaries should be construed as recommendations to buy or sell any securities, and investors should do their own research and/or consult with a financial professional before making any investment decisions.
Our latest recap available to Bespoke subscribers covers Shopify’s (SHOP) Q3 2024 earnings call.
Shopify (SHOP) is a leading e-commerce platform empowering businesses of all sizes to build, manage, and scale their online and offline storefronts. SHOP offers solutions for payments, marketing, inventory, logistics, and now AI-powered automation, serving over 1 million merchants worldwide. SHOP posted a standout Q3, with GMV (Gross Merchandise Value) rising 24% YoY, marking its fifth consecutive quarter of 20%-plus growth. Revenue increased 26% to $2.2 billion, driven by its growth internationally (33% GMV growth outside North America), offline commerce (27% GMV growth), and AI-powered features like personalized responses and enhanced automation. The Shop App saw an 18% boost in buyer engagement sessions, while the B2B segment surged 145%, fueled by new tools and enterprise adoption. The company launched integrations with PayPal, YouTube, and Roblox, and its new data migration tool enables merchants to onboard thousands of SKUs to the platform in a matter of minutes. On in-line EPS and better-than-expected revenues, SHOP shares surged 21% on 11/12…
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Homebuilders Present vs. the Future
This morning the National Association of Home Builders published their latest update on home builder sentiment. The headline index rose to 46 versus an expected decline from 43 to 42. That three-point jump marks the largest one-month uptick since March but only leaves it in the middle of its range from the past couple of years.
Of the sub-indices, future sales stood out the most. The index surged 7 points month over month to reach the most elevated reading since April 2022. That is just above the historical median and suggests homebuilders are optimistic in spite of weaker readings in traffic and present sale indices.
As noted, present sales and traffic were not as rosy as future sales. As shown below, present sales were higher in November rising 2 points month-over-month to 49. However, that is only in the 29th percentile of historical readings, and more recently that is well within the range of readings from the past couple of years.
With present and future sales moving in the opposite direction, a massive divergence has formed between the two. As shown below, for most of the survey’s history, future sales have tended to be higher than present sales for sustained periods albeit with some exceptions like the first couple of years of the pandemic. The last time present sales were stronger than future sales (negative readings in the chart below) was just five months ago, but there has been a massive turnaround since then. With November’s reading, the spread is at the highest level (meaning sentiment towards future sales is stronger than present sales) since December 2006. Late 1991 was the only other time in which there was as wide of a divergence between the two.
Not only has there been a divergence between present and future sales, but the report also showed some divergence in sentiment based on geography. As shown below, homebuilder sentiment has perked up in the Northeast and the Midwest. Conversely, sentiment was lower month over month and closer to the low ends of recent ranges in the South and West.
As for homebuilder stocks, the long-term uptrend remains in place albeit the chart isn’t as constructive as it once was. In late October, the iShares US Home Construction ETF (ITB) fell back below its 50-DMA for the first time since late spring and early summer when there was a successful test of support at the longer-term 200-DMA. While there hasn’t been any sort of similar drawdown to support this go around, one week ago there was a failed attempt to move back above the 50-DMA. That leaves the group in no-man’s-land sandwiched between the two moving averages.
Bespoke’s Morning Lineup – 11/18/24 – He Loves Me, He Loves Me Not
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“It is a very sobering feeling to be up in space and realize that one’s safety factor was determined by the lowest bidder on a government contract.” – Alan Shepard
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
Two headlines on the front page of the Wall Street Journal stood out to us this morning. The first was “Investors Are Betting on a Market Melt-Up.” There’s not much to say about this except that if you are bullish on the market, given the election results and other factors, you’re not alone. That’s not to say that the market has to go down, but gains could be harder to come by. The beach is always much better when it’s less crowded.
The second headline concerns the still-awaited nomination from President-elect Trump over who should become Treasury secretary (“Jockeying To Lead Treasury Spills Out In Public”). Heading into the weekend, it looked like it was a two-person race between Scott Bessent and Howard Lutnick, but now it appears that the lobbying has annoyed Trump, and he is now expanding the potential field from more than just those two. This pick is easily the most important remaining pick of the future President’s cabinet, and depending on who “gets the rose” it would impact US trade policy and the dollar’s direction.
Markets hate uncertainty, and perhaps some of the increased uncertainty over who will lead the Treasury Department has shown up in the performance of gold and bitcoin this morning, as both are trading higher.
Starting with gold, after an 8% pullback from its late October high and breaking its uptrend that had been in place since earlier in the year, the SPDR Gold Trust (GLD) is trading up over 1% this morning after bouncing near support levels coinciding with its late summer base. If you’re long GLD, seeing a bounce after six days in a row of losses is nice. The real test will come in the days ahead as it looks to get back above that former uptrend line.
It’s hard to attribute a daily 1% move in Bitcoin to anything specific as it’s such a volatile asset. But even after many assets that surged in the immediate days after the election have started to pull back, bitcoin remains within 1% of its record high last week.
Brunch Reads – 11/17/24
Welcome to Bespoke Brunch Reads — a linkfest of some of our favorite articles over the past week. The links are mostly market-related, but there are some other interesting subjects covered as well. We hope you enjoy the food for thought as a supplement to the research we provide you during the week.
“Governator”: On November 17th, 2003, Arnold Schwarzenegger was sworn in as the 38th Governor of California. Schwarzenegger addressed the crowd with a mix of optimism and resolve, focusing on his commitment to repairing California’s battered economy and political dysfunction. In his inaugural speech, he emphasized bipartisan cooperation and vowed to be a “servant to the people” rather than a career politician.
Schwarzenegger served from 2003 to 2011, in what proved to be a tumultuous period marked by fiscal crises, environmental breakthroughs, and more. In his tenure, he tackled a massive budget deficit through spending cuts and voter-approved bonds, though long-term solutions were elusive. Schwarzenegger’s most enduring legacy lies in environmental leadership, particularly the 2006 Global Warming Solutions Act, which made California a global leader in climate policy. While his 2005 ballot reforms failed, and the Great Recession strained state resources, he worked across party lines on infrastructure improvements and healthcare initiatives.
Education
At Business Schools, More Women Are Getting MBAs (BNN Bloomberg)
Women’s enrollment in MBA programs has hit a new high, with 42% of students identifying as female, up from roughly 4,000 in 2011 to over 6,100 this year. Eight schools, including Johns Hopkins and Duke, have reached gender parity, marking significant progress in representation. However, achieving and sustaining equal enrollment remains a challenge, as many schools rely on targeted recruitment events and alumni mentorship to attract female candidates. The ultimate goal is to translate this progress into more women in corporate leadership, though only 7.4% of S&P 500 CEOs are women, despite 41% holding MBAs. [Link]
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The Bespoke Report — 11/15/24 — The Trump Fade
To read our weekly Bespoke Report newsletter and access everything else Bespoke’s research platform offers, start a two-week trial to Bespoke Premium. In this week’s report, we focus on the rotation in stocks under the hood of this week’s post-election equity market rally. We also review earnings season results, economic activity in China, US economic data, market sentiment indicators, and much more in this week’s report.
Daily Sector Snapshot — 11/15/24
Q3 2024 Earnings Conference Call Recaps: Home Depot (HD)
Bespoke’s Conference Call Recaps use AI to summarize lengthy earnings calls. The commentary below is AI-generated and then edited by Bespoke for quality control. As always, none of these summaries should be construed as recommendations to buy or sell any securities, and investors should do their own research and/or consult with a financial professional before making any investment decisions.
Our latest recap available to Bespoke subscribers covers Home Depot’s (HD) Q3 2024 earnings call.
Home Depot (HD) is the world’s largest home improvement retailer, operating over 2,300 stores across North America. The company provides tools, construction materials, appliances, and services to DIY enthusiasts and professional contractors, making for a good read into consumer spending trends, housing market dynamics, and macroeconomic conditions. For its Q3 report, HD reported sales up 6.6%, with comps down 1.3%. Hurricanes Helene and Milton added $200 million to sales, offsetting macro headwinds like higher interest rates, which continue to pressure large remodeling projects and home turnover. Seasonal products, Halloween, and outdoor categories outperformed, while Pro sales outpaced DIY, bolstered by investments in Pro customer support and the SRS acquisition, which added $2.9 billion in sales. Shrink mitigation showed promising results, aiding margins. The company is also focused on improving delivery speeds and customer engagement through digital tools and marketing. HD recorded its first triple play since May 2022 and gapped up 1.5% at the open on 11/12, but fell intraday to close 1.3% in the red….
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