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Happy Tuesday afternoon to everyone on The Street. Here's a snapshot of where markets ended the trading session, plus tomorrow's trade idea delivered to you today.

• 🟥 | US stocks fell Tuesday as tech shares struggled and weak manufacturing data raised concerns about the economy's health. The Dow Jones ended lower by 626 points or 1.5%, the S&P 500 slid 2.1%, and the Nasdaq Composite shed 3.3%.

• 📈 | One Notable Gainer: Shares of vaccine-maker Vaxcyte surged 37% after positive Phase 1/2 results for the 31-valent pneumococcal vaccine, with Leerink Partners calling it a potential “category killer” for preventing disease in adults 50 and older.

• 📉 | One Notable Decliner: Crypto miner Cleanspark’s stock fell over 16% after its August mining update revealed a decrease in bitcoin production to 478 from 494 in July.

• 🍼 | Tomorrow's Trade: A Baby Boom or a Stock Boom? Scroll down for more.

Plus, check out how you can build your made-to-order IRA with Betterment.

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MARKET MOVERS

Boeing, NVIDIA, U.S. Steel

BA (-7%) Boeing's cash flow goal to be delayed, says Wells Fargo as it downgrades stock (Reuters)

NVDA (-10%) Nvidia Stock Drops Again. Here’s What Is Dragging on the Chip Maker’s Shares. (Barron’s)

X (-6%) Kamala Harris opposes U.S. Steel takeover by Japanese company (Axios)

U (+2%) Unity Software shares jump pre-market on Morgan Stanley upgrade (Investing.com)

AVGO (-6%) What Wall Street Analysts Think of Broadcom’s Stock Ahead of Earnings (Investopedia)

OVERHEARD ON THE STREET

QZ: Boeing faces a potential machinist strike as its contract with the union nears renewal, adding pressure to an already full agenda.

CNBC: A new study shows semaglutide, found in Ozempic and Wegovy, reduces severe Covid-19 risk and may offer additional health benefits.

WSJ: Polestar named Jean-Francois Mady CFO, starting Oct. 21, as part of its ongoing executive shake-up following last week’s CEO change.

CNN: DirecTV is offering $20 credits for 11 million subscribers affected by the Disney channel blackout, but customers must apply online.

Reuters: Airbnb urged New York City to reconsider new short-term rental rules, citing higher traveler costs and no effect on the housing market.

TOMORROW’S TRADE IDEA, TODAY

Could This Childcare Company Go From Crawling To Sprinting?

Don’t Call It a Comeback

Bright Horizons Family Solutions (BFAM) is one of the largest childcare companies on the planet, providing care for around 115,000 children.

But the childcare industry was hit hard by the pandemic, and Bright Horizons was no exception. It was forced to close around 80% of its locations in the wake of lockdowns.

Before the pandemic, Bright Horizons’ stock was a Wall Street favorite. Now, it is well on its way to recovery, and investors are beginning to take notice.

A New Kind of Childcare

At present, Bright Horizons has over 1,000 locations across the globe and 31,000 employees. Last year, around three-quarters of its revenue was generated by daycare services. 

But analysts are particularly excited about its “backup childcare” service. The company is signing multi-year contracts with major employers to provide subsidized backup childcare for employees should they need it. 

This side of the business is faster-growing and more profitable than its normal daycare business and accounted for a third of its revenue last year.

Increasing Earnings

According to Vincent DeAugustino of T. Rowe Price, Bright Horizons could see its facilities’ utilization rates return to pre-pandemic levels as soon as next year. 

It is also increasing employee pay to help solve staffing issues, and raising tuition costs. On top of that, it is rapidly acquiring new locations. As a result, analysts expect EPS to hit $4.17 by 2025, a 24% jump. 

The stock is a bit expensive, trading at around a multiple of 35. But that may be understandable, given its exciting new business model — and the fact that its client base consists of half of the Fortune 500.

Much like the toddlers it provides care for, Bright Horizons took a tumble, but is already trying to get back on its feet. According to DeAugustino, investors could be wise to extend a helping hand.

TOGETHER WITH BETTERMENT

Your IRA, made to order

Choose where and when you want to retire, and a Betterment IRA can help make your money hustle all the way there.

Learn more

ON OUR RADAR

Axios: U.S. consumer spending rose from June to July, reducing the personal savings rate to 2.9%, its lowest since June 2022.

CNN: At the US Open, sales of the Honey Deuce cocktail are set to exceed $10 million, surpassing the combined $7.2 million prize for singles winners.

AP: Solo dining in the U.S. is up 29%, prompting restaurants to adjust seating, menus, and ambiance to better accommodate individual diners.

WSJ: The average number of employees at pandemic-era startups sharply declined, indicating a shift towards smaller, leaner businesses.

CNN: Baltimore hotel workers joined a nationwide strike of 25 hotels across 9 US cities, including major chains from Boston to Hawaii, during peak travel.

FRIDAY’S POLL RESULTS

Are you bullish or bearish on Macy’s (M) over the next 12 months?

🟩🟩🟩🟩🟩🟩 🐂 Bullish

🟨🟨🟨🟨⬜️⬜️ 🐻 Bearish