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💎 Ford's Hidden Gem
Plus, Boeing and NASA's fight over how to bring stranded Starliner astronauts home.
Happy Thursday 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 Rose on Thursday. All three major indexes rose, and the S&P 500 posted its best day since 2022 as recession fears calmed.
📈 | One Notable Gainer: Shares of Under Armour shot 19% higher after posting better-than-feared quarterly sales, beating Wall Street’s expectations on both top and bottom lines.
📉 | One Notable Decliner: Dutch Bros’ stock fell 20% after the coffee chain reported that it expects new store openings to end up on the lower end of its previously guided range of 150 to 165.
💎 | Tomorrow's Trade: Ford's Hidden Gem. Scroll down for more.
Plus, here’s how to build the ultimate dividend portfolio…
S&P 500 Heatmap. Credit: Finviz
All Stock Heatmap. Credit: Finviz
Global ADR snapshot. Credit: Finviz
MARKET MOVERS
MNST (-11%) Monster Beverage’s stock had its worst day in more than six years after its earnings missed Wall Street expectations (CNBC)
LLY (+9%) Eli Lilly reported significantly better-than-expected earnings, with revenue coming in 13% higher than Wall Street estimates (YF)
WBD (-9%) Warner Bros. Discovery posted a $9.1 billion write-down on its troubled network assets, signaling a declining TV business (CNN)
KVYO (+34%) Marketing automation provider Klaviyo raised its full-year revenue guidance as second-quarter revenue surged by 35% (MW)
Z (+18%) Zillow reported a second-quarter earnings beat and announced that its CEO, Rich Barton, is stepping down (YF)
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OVERHEARD ON THE STREET
WSJ: Boeing and NASA are tussling over the plan to bring the Starliner astronauts home, considering using SpaceX to close out the mission.
Axios: One last Starliner news item… NASA's Boeing Starliner astronauts could be left in orbit until February.
USA Today: Discount store chain Big Lots may close up to 315 stores, according to a recent Securities Exchange Commission filing.
Axios: Hims & Hers plans to acquire a compounding pharmacy as the telehealth company doubles down on weight-loss drugs and expands into other categories.
Bloomberg: Steven Mnuchin says it’s time to kill the 20-year treasury bond, which he created four years ago as Treasury head.
TOMORROW’S TRADE IDEA, TODAY
Changing the Narrative
For a long time the word “fleet” had a negative connotation surrounding it, often associated with low profits as far as Wall Street was concerned.
Ford (F) is changing all that as its fleet business becomes an earnings machine. The automaker sells vehicles to commercial, government, and rental customers.
Business is booming – so much so that rivals GM (GM) and Stellantis (STLA) are starting to follow suit.
Bringing in the Big Bucks
Historically speaking, fleet sales have been less profitable than retail sales. Fleet sales have often been used as a means to simply offload excess inventories and pump up sales volume.
But things seem to be turning around. Ford’s “Ford Pro” fleet business has raked in $184.5 billion in revenue since 2021. Analysts are calling the business arm Ford’s “hidden gem.”
Last month during the company’s earnings call, CEO Jim Farley revealed to investors that the fleet business isn’t so hidden to Ford executives, and they intend to maximize its potential.
Ahead of the Competition
One major reason Ford’s fleet business is doing so well is the fact that US vehicles are getting older. The average age of fleet and commercial vehicles on the road today is 17.5 years.
Both GM and Stellantis are honing in on their fleet businesses to take advantage of the current market. But Ford still accounts for around 30% of the market for new fleet vehicle registrations, well ahead of GM’s 21% and Stellantis’ 9%.
Wolfe Research estimates Ford will bring in $9.5 billion in fleet sales this year, with GM at $5.5 billion and Stellantis at $3.5 billion.
Ford’s stock is down over 24% in the last month and about 19% YTD, so investors could get in on the action before everyone flocks to the fleet business.
Are you bullish or bearish on Ford (F) over the next 12 months? |
TOGETHER WITH PROSPERITYPUB
Free workshop shows the 3-step process anyone can use to build what could be an income producing portfolio of dividend stocks.
Plus, you'll get the TOP 7 dividend stocks for FREE. That way, you can start building your own ultimate dividend portfolio as soon as the workshop is over!
ON OUR RADAR
Fortune: Hyundai and Kia cars targeted by TikTok thieves see theft rates drop by over half after software updates.
NYT: Axios is laying off 10% of its staff, and its CEO Jim VandeHei said the cuts are necessary to adapt to “changes in the media business.”
CNN: Boeing still doesn’t know who removed and reinstalled the part that blew off an Alaska Airlines jet.
Teslarati: In a post on X, Elon Musk said that there could be over 1,000 humans with Neuralink implants by 2026.
AP: Coca-Cola will pay the IRS $6 billion in back taxes and interest while it appeals a final federal tax court decision in a 17-year-old case.
YESTERDAY’S POLL RESULTS
🟩🟩🟩🟩🟩🟩 Yes ✅
🟨🟨🟨🟨🟨⬜️ No ❌
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