Happy Wednesday 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 were mixed today, but the S&P 500 crept up to another record.

• 📈 | One Notable Gainer: Occidental (OXY), Warren Buffett’s go-to energy stock, saw its shares add more than 4% after reaching its $4.5B debt repayment target 7 months early.

• 📉 | One Notable Decliner: Chemicals company Celanese (CE) triggered a bad reaction to its earnings. Its stock shed over 20% on a quarterly loss and weak outlook.

Sponsored by Cadiz

The Ground Floor’s Getting Crowded — But There’s Still Room For More

Barclays PLC upped its holdings in Cadiz, Inc. (NASDAQ: CDZI) by more than 300% in the third quarter.

It wasn’t the only one. At last check, B. Riley Financial, Equitec Proprietary Markets, HCR Wealth Advisors, and GAM Holding AG all grew their stake in the same company by double- to triple-digit percentages.

Curious why? You should be. Cadiz has several developments in the pipeline that point to a potential breakout on the horizon. It’s not hard to see why major investors are crowding into the ground floor — but there’s still room for more.

MARKET MOVERS

Hims & Hers, Etsy, Super Micro

HIMS (+17.6%) Hims & Hers to offer at-home blood draws and lab testing with new acquisition (CNBC)

ETSY (-10%) Etsy Stock Falls on Revenue Miss. ‘Significant’ Headwinds Hit Merchandise Sales. (Barron’s)

SMCI (+8%) Super Micro stock recovers from long rout following accounting violation accusations from Hindenburg (YF)

CDNS (-8.8%) Chip design software maker Cadence forecasts annual profit below estimate, shares down (Reuters)

GRMN (+12.7%) Garmin jumps to a new all-time high after sailing past earnings expectations on broad sales strength (SeekingAlpha)

OVERHEARD ON THE STREET

NYT: Apple announced the iPhone 16e, a lower-cost, AI-compatible model priced at $599.

Reuters: Microsoft unveiled a new quantum chip that it claims shows quantum computing is "years, not decades" away.

Fox: Electric-truck-maker Nikola filed for Chapter 11 bankruptcy protection after struggling to overcome market and macroeconomic challenges.

CNBC: Forever 21 is in talks with liquidators, indicating it is seeking a buyer or considering a second bankruptcy filing.

Bloomberg: The latest FOMC minutes indicate Fed officials plan to hold rates steady until inflation improves, noting risks from trade and immigration policy.

TOMORROW’S TRADE IDEA, TODAY

Bath & Body Works Is Back

BBWIng It Back

Whatever Bath & Body Works (BBWI) has been doing lately, it has not been working. The stock has underperformed the S&P for three years running.

But JPMorgan (JPM) believes the beaten-down retailer is back. Analyst Matthew Boss recently lifted his rating on the stock to Overweight and raised his price target to $47 per share.

The stock surged following the upgrade, climbing around 13% over the past 5 days. But the new target still represents more than 17% upside from current prices.

Turnaround Time?

According to Boss, BBWI is trading at around 40 percentage points lower than other companies in its industry. However, he thinks a turnaround is on the horizon, largely thanks to its opportunities for collaborations.

Bath & Body Works is also seeing its operating margins expand and free cash flow increase to around $825 million annually. It plans to use that capital to repurchase $1.7 billion worth of stock by the end of 2026.

Semi-Annual Steal

The stock buybacks, coupled with the stock’s 2% dividend, could bring in a solid 9% return for investors strictly from capital allocation, according to the analyst.

Most on the Street share Boss’s sentiment. 12 of 19 analysts covering the stock have given it a Strong Buy or Buy rating.

BBWI has fallen nearly 12% over the past twelve months. To hear Boss tell it, investors shouldn’t think of that as a black mark, but more like a red tag at one of its famous fire sales.

Sponsored by Cadiz

A Groundbreaking Partnership

This year, Cadiz, Inc. (NASDAQ: CDZI) is set to break ground on the Southwest’s largest water pipeline. The Mojave Groundwater Bank will send affordable, reliable, and clean water to much of the region, including historically underserved communities.

Cadiz made news in November when it purchased 180 miles of steel pipe from the failed Keystone XL project. And investors’ heads turned again shortly thereafter when the Lytton Rancheria tribe announced it would invest $50 million in the project.

It’s a groundbreaking partnership (see what we did there?) that marks the first major investment by a Native American tribe in large-scale water infrastructure off tribal lands.

ON OUR RADAR

Bloomberg: President Trump called Ukrainian President Zelenskyy a "dictator”, his most direct threat to Ukraine's leader ahead of the Trump-Putin summit.

WSJ: The Trump administration rescinded approval of New York City's congestion pricing system, halting the plan to reduce traffic and fund the transit system.

CNBC: UnitedHealthcare is offering buyouts to employees in its benefits unit, with layoffs possible if resignation quotas aren't met.

AP: The US became Germany's biggest single trading partner last year, surpassing China as exports to the Asian nation declined.

CNN: KFC is leaving Kentucky, moving its corporate headquarters to Texas to join its sister brand Pizza Hut in Plano.

TUESDAY’S POLL RESULTS

Which stock do you think will outperform in 2025?

🟨🟨🟨🟨🟨⬜ EQT (EQT)

🟩🟩🟩🟩🟩🟩 Tuya (TUYA)

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