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 On Tuesday, closing out a losing month for each of the three major indexes. In April, the S&P 500 lost 4%, the Nasdaq Composite shed 5%, and the Dow fell 4%. This comes after the release of higher-than-expected wage and inflation data that could impact the Fed’s rate decision tomorrow.

• 📈 | One Notable Gainer: Shares of Eli Lilly surged 6% after the company signaled a rise in obesity and diabetes drug production. Supply constraints were the limiting factor in Eli Lilly’s first-quarter sales growth.

• 📉 | One Notable Decliner: Online education company Chegg saw its shares dive 28% after issuing disappointing guidance in part because students are using ChatGPT instead of its platform.

• 🧺 | Tomorrow's Trade: Buying a Bushel. Scroll down for more.

Plus, our partner revolutionizes how individuals invest, empowering them to learn and apply the principles of long-term investing at every stage of their journey.

MARKET MOVERS

Burger King, Walmart, & Tesla

QSR (+3%) Shares of Burger King’s parent company rose after announcing plans to invest another $300 million to remodel its restaurants in the US (CNBC)

MMM (+6%) 3M’s quarterly earnings topped estimates, and the company is resetting its dividend after spinning off its healthcare business (Barron’s)

WMT (-1%) Shares of Walmart fell more than 1% after the company announced it is closing all of its healthcare clinics due to lack of profitability (CNN)

TSLA (-6%) Tesla shares fell after rallying 15% yesterday. This comes as Musk is reportedly back in layoff mode even after a recent 10% workforce cut (IBD)

GLW (+5%) Specialty glassmaker Corning posted solid first-quarter results that included an upbeat outlook for the rest of the year (Barron’s)

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OVERHEARD ON THE STREET

BI: The Fed is expected to once again hold interest rates steady on Wednesday and some predictions do not forecast interest cuts until the second half of 2024.

The Hill: A contributing factor- Workers’ paychecks grew faster in the first quarter, a trend that concerns the Fed and could contribute to higher inflation.

BI: A BMO strategist claims the Fed might have to self-induce a recession if it wants to reach its target inflation.

Axios: The FTC could be preparing to block Walmart’s $2.3 billion acquisition of Vizio as the agency is requesting more information from both companies.

WSJ: Walmart is taking on Trader Joe’s and Whole Foods with its new premium brand in its latest attempt to expand its food empire.

TOMORROW’S TRADE IDEA, TODAY

Buying a Bushel

Do as Buffett Does

Bernstein (EQH) is bullish on Apple (AAPL). The stock has dropped more than 6% this year as investors fear poor iPhone 15 sales and dwindling Chinese revenue will hurt the company.

Now Bernstein has upgraded the stock to outperform as it views the current price as a strong entry point. Analysts are encouraging investors to “be like Buffett” who has famously added Apple shares when they are cheap and sold when they are high. It’s no wonder Buffett's Berkshire Hathaway (BRK) has become Apple’s largest active shareholder, owning around 6% of the stock.

It’s All About the P/E Ratio

Bernstein analyst Toni Sacconaghi encourages investors to buy shares when the stock is trading at 25x earnings or lower and sell when it’s 30 times or higher.

Despite upgrading the stock, the firm has kept its price target of $195 per share, a 12% increase from Monday’s close. Currently the stock is trading at a 26.4 price-to-earnings ratio based on 2024 earnings estimates, a 22.9 ratio based on 2025 estimates.

Apple’s second-quarter revenue expectations are low, and Sacconaghi believes now is the time to “buy the fear.”

Timing Is Everything

Sacconaghi isn’t as worried about Apple’s China problems as many other investors. The analyst pointed out that Apple’s business in China is historically volatile and hasn’t hurt the company’s growth.

He also touted generative AI developments as features that could lead to a successful iPhone 16 launch in September. Bernstein data shows that buying Apple shares in the three months leading up to an iPhone release has paid off during 15 of the last 17 releases.

Watching and learning from a high-profile investor is common practice. According to several indicators, now could be a good time to get a bushel of Apples at a discount.

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Simply Wall St revolutionizes how individuals invest, empowering them to learn and apply the principles of long-term investing at every stage of their journey.

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• All your portfolios in one place: effectively analyze and track your investments.

• Intelligent alerts: receive timely updates for new warning signs and opportunities.

“I believe that Simply Wall St is the best program out there. Not only do they provide all the analytic data you need but they display it in a user-friendly format that is actionable. They also provide weekly emails on what is going on with your portfolio, insider buying and selling, dividends analyst recommendations etc…” 
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ON OUR RADAR 

WSJ: Over $38 billion of U.S. office buildings face loan defaults, foreclosures, or other forms of distress, the highest amount since 2012.

Bloomberg: The euro zone exited recession as its four top economies drove much speedier growth than expected.

BI: A recent YouGov study showed that young parents with over $5,000 in disposable income are emerging as significant consumers in the luxury market.

CNBC: BofA claims that a direct Iran-Israel war could spike oil by $30 to $40 per barrel, assuming Iran’s daily crude oil production falls by up to 1.5 million barrels.

NYT: Sources within banks told the New York Times that incoming junior Wall Street analysts could be in danger of losing their jobs to AI.