Consumer Discretionary

Tesla Is Navigating Free FSD Trials, Gigafactory Challenges, and Governance Hurdles: Analyst

/ / Consumer Discretionary /

RBC Capital Markets analyst Tom Narayan maintained an Outperform rating on Tesla Inc (NASDAQ:TSLA) with a price target of $298. The fourth quarter of fiscal 2023 saw a demand-pull forward from the IRA expiry of particular Model 3s, and that likely negatively impacted the first quarter of 2024, as per the analyst. The analyst flagged the Red Sea disruption in January and the arson attack in February, hampering the Berlin gigafactory operations. Narayan expects the company’s decision to give one month of free trials of FSD in the U.S. will help drive higher volumes in the second quarter. Higher FSD attach rates are also central to his investment thesis on the stock. Narayan projects Tesla deliveries of 446,000 in the first quarter of 2024, down 10.7% vs. his prior estimate of 500k and 3.3% below consensus, based on registration data and app downloads. He expects Tesla to report deliveries during the first week of April. […]

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Estée Lauder Shares Climb 6.2% After Bank of America’s Upgrade on Turnaround Efforts

/ / Consumer Discretionary /

Shares of Estée Lauder on Thursday climbed after Bank of America upgraded its recommendation on the stock to buy from neutral as the beauty giant implements a profit-recovery plan. The owner of cosmetics brands such as Clinique, La Mer and Bobbi Brown should benefit from a reacceleration of sales and profit growth as Estee Lauder exits the fiscal year ending in June 30 with better visibility into end-market demand, Bank of America analysts say in a research note. The New York company lost focus on product upgrades and innovation in recent years. However, its current innovation push to respond faster to trends and repair brands portfolios should come with improvements across the prestige category. Bank of America expects to see innovation specifically aimed at reversing recent market-share softness in makeup from MAC and Tom Ford. Estée Lauder’s success is dependent on achieving more consistent growth across developed markets and emerging

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Disney Likely Has Several Sources of Potential Earnings Upside, UBS Says

/ / Consumer Discretionary /

Walt Disney’s (DIS) business model has multiple sources of potential upside that could drive earnings higher over the next several quarters, UBS Securities said in a note e-mailed Wednesday. The firm increased its per-share earnings outlooks for Disney by 3% to 6% from 2024 through 2026, with results likely driven by a better performance from the company’s parks business, with additional help from the direct-to-consumer and content segments, UBS analysts, including John Hodulik, said. UBS raised its price target on Disney stock to $140 from $120, with a buy rating.

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Estée Lauder Launches Clinique Amazon Store in Distribution Shift

/ / Consumer Discretionary /

Estée Lauder’s latest move amid its profit recovery plan is aimed at gaining consumers by taking control of the U.S. ecommerce giant, following similar steps from competitors such as L’Oréal, Coty and Shiseido. It directly partners with Amazon for the first time by launching a U.S. Amazon Premium Beauty store for Clinique. Other Estée Lauder brands will have their own Amazon stores over the coming months, CEO Fabrizio Freda says. Amazon, which started selling cosmetics in 2004, is leading growth across all retailers in beauty growth, with prestige outpacing mass growth, according to NIQ data from December. Shares rise 2% to $142.15.

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Walt Disney Likely Has Multiple Avenues of Potential Earnings Upside, UBS Says

/ / Consumer Discretionary /

Walt Disney’s (DIS) business model likely has several sources of potential earnings upside in the coming quarters, led by better results at its parks business, with additional help from the direct-to-consumers and content segments, according to UBS Securities. These sources are expected to drive the media and entertainment giant’s earnings estimates higher over the next several quarters, yielding a 25% three-year compound annual growth rate, UBS analysts John Hodulik, Batya Levi, and Christopher Schoell said in a note Wednesday. The brokerage expects the parks segment’s earnings before interest and taxes to grow by double-digit percentage annually in both the fiscal second quarter and full year amid strong US attendance. The company’s spending plan is likely to drive high-single-digit or better EBIT growth in the business for “several years,” the analysts said. “Despite the tougher comparisons, we expect the experiences segment to remain a high-growth and cash generative business for Disney,”

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Nike’s Successful Air Max DN Launch Gets Off On The Right Foot, Says Analyst

/ / Consumer Discretionary /

Wedbush analyst Tom Nikic reiterates an Outperform rating on the shares of Nike Inc (NYSE:NKE) with a price target of $115. While NKE shares have languished recently due to investor frustration over lack of exciting new products, the analyst notes the company got much-needed good news on their annual “Air Max Day” celebration. The analyst points to the new Air Max DN model that debuted in multiple colorways, and completely sold out on Nike.com. This product, according to the analyst, is important because the company has been off its game from a product development perspective in recent years, so it desperately needs a hot new product to drive brand heat. Also, in an increasingly competitive sneaker environment where rivals are innovating with foam-based cushioning, Nike’s specialization with air-based cushioning systems is a key point of differentiation versus peers, notes the analyst. Thus, the analyst sees the successful initial launch as a positive data

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CFRA Keeps Buy Opinion On Shares Of Amazon.com, Inc.

/ / Consumer Discretionary /

CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows: Today, AMZN raised its investment in AI startup Anthropic by $2.75 billion, bringing its total stake to $4 billion after an initial $1.25 billion investment last September. As part of this partnership, Anthropic will use Amazon Web Services (AWS) as its primary cloud provider and leverage AWS’s Trainium and Inferentia chips to build, train, and deploy future foundational AI models. These models are now available on Amazon’s Bedrock platform, which also hosts large language models from other major AI companies like AI21 Labs, Cohere, Meta, Mistral AI, and Stability AI, as well as Amazon’s own models. Earlier this month, Anthropic released the Claude 3 model family, which includes Claude 3 Haiku, Claude 3 Sonnet, and Claude 3 Opus. Claude 3 Opus is the most intelligent chatbot of

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Walmart Hits Pause Button on Vizio Deal After ‘Informal’ Antitrust Talks

/ / Consumer Discretionary /

Walmart Inc. (WMT) and Vizio Corp. (VZIO) said late Wednesday they are going to refile paperwork related to their proposed merger after the retail giant held “informal” antitrust talks with the Federal Trade Commission and the Justice Department. Walmart in a securities filing said it notified the agencies that it will withdraw and refile a premerger notification “in order to give the antitrust agencies additional time to review the proposed transaction.” The notification was originally sent on Feb. 26, and the refile is expected on Friday. Shares of Walmart were down a fraction in the extended session Wednesday, and shares of Vizio fell 1%.

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Tesla Pushes to Increase Use of ‘Full Self-Driving’ Software as Vehicle Sales Cool — WSJ

/ / Consumer Discretionary /

By Ryan Felton and Rebecca Elliott Tesla is stepping up promotion of its driver-assistance technology, called “Full-Self Driving Capability,” seeking to expand use of the revenue-generating software feature as it confronts the prospect of lower growth in vehicle deliveries this year. Elon Musk, Tesla’s chief executive, told employees this week in an internal email that customers must receive a test drive using the technology before they receive a car. The system is an advanced version of the company’s Autopilot technology, which is available on all new Teslas and is designed to help with driving tasks like steering and lane changes. Full Self-Driving, an upgrade available for $12,000 up front or $199 a month as a subscription service, includes features that can navigate cars through city streets. “I know this will slow down the delivery process, but it is nonetheless a hard requirement,” Musk said in the employee email, which was

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