Core Insights - Nissan's new CEO Ivan Espinosa emphasizes the need for optimism and adaptability in a challenging global auto industry environment marked by slowing EV sales, increased competition from China, and new tariffs impacting profits [1][2] Group 1: Industry Challenges - The global auto industry is facing significant challenges, including slowing electric vehicle (EV) sales and heightened competition from Chinese manufacturers [1] - New tariffs are posing additional threats to profit margins within the industry [1] Group 2: Leadership Dynamics - CEO departures in U.S. companies surged by 38% in December, with a record total of 2,221 CEOs stepping down in 2024, the highest since tracking began in 2002 [3] - Espinosa advocates for a modern leadership approach that embraces flexibility and openness to change, contrasting with past leadership styles that were often stubborn and resistant [3] - The current environment necessitates more collaboration among industry leaders, as geopolitical issues and supply chain challenges make it difficult for companies to operate independently [3]

The Apple store on 5th Avenue is seen in New York on April 8, 2025. Forecasts for Apple and Samsung shipment growth this year were sharply slashed by Counterpoint Research on Wednesday amid uncertainty over U.S. tariff policy. The research outfit said it had revised down its 2025 global smartphone shipment growth forecast to 1.9% year- on-year from 4.2% previously, citing "renewed uncertainties surrounding U.S. tariffs." Apple's downgraded shipment growth will be driven by the iPhone 16 series of devices, a ...

May 30, 2025 05:00 AM GMT US Economics Weekly | North America Trade uncertainty, immigration certainty If IEEPA tariffs are overturned, we think the White House can recreate its current tariff structure using other authority. We revise lower our estimate for immigration. Low immigration will make it harder for the unemployment rate to rise. It also pulls potential growth and the neutral rate lower. Key Takeaways Exhibit 1: Trade policy may be uncertain, but immigration policy is not. Incoming data through A ...

Group 1 - The current operating environment is characterized by uncertainty, prompting companies to reassess their supply chains and decision-making processes [3][4] - Companies are seeking more transparency and data integration to navigate through uncertainty, indicating a demand for solutions that combine financial data with risk management [4]

V i e w p o i n t | Brian Levine +1-212-816-6896 brian.levine@citi.com Osamu Takashima +81-3-6776-3251 osamu.takashima@citi.com 29 May 2025 13:15:24 ET │ 10 pages Global FX Strategy Uncertainty is the only certainty CITI'S TAKE FX markets have been quick to fade the overnight USD rally after President Trump's IEEPA tariffs were struck down in court; we see this as a market recognition that this ruling will be appealed and that there are other tools available for the Trump administration (such as Section 122 ...

US trade policy uncertainty continues to affect trade flows and investment decisions. Amid the US announcement of reciprocal tariffs, China's overall cell phone exports dropped 21% y-o-y in April, among which, smartphone shipments to the US declined by 70% y-o-y (based on HS code 851713), despite the reciprocal tariff exemptions for some consumer electronics (though they were only announced mid-April). iPhones are primarily produced and assembled in China, but reportedly Apple is looking to shift production ...

Market Overview - The three major U.S. indexes ended the holiday-shortened trading week in the red, with the Nasdaq Composite declining by 0.44%, and both the S&P 500 and Dow Jones Industrial Average losing 0.17% each, attributed to renewed trade tensions with the European Union and China [1] - The Federal Reserve's May meeting minutes indicate that new foreign trade tariff policies could lead to persistent inflation, hinder economic growth, and diminish global confidence in U.S. assets [2] Economic Indicators - The second estimate of Q1 2025 Gross Domestic Product (GDP) showed a contraction at an annual rate of 0.2%, an improvement from the initial estimate of a 0.3% decline, marking the first drop in three years [2] - The labor market remains resilient but shows slight signs of weakening, with jobless aid rising to 240,000 for the week ending May 24th, and Continuing Jobless Claims increasing to 1.92 million [2] Stock Performance - Banco Comercial Português (BPCGY) shares gained 13.9% since being upgraded to Zacks Rank 2 (Buy) on March 31, outperforming the S&P 500's 6.1% increase [3] - PDS Biotechnology Corporation (PDSB) also saw a return of 9.5% since its upgrade to Zacks Rank 2 on March 31 [4] - A hypothetical portfolio of Zacks Rank 1 (Strong Buy) stocks returned -8.32% in 2025 (through May 5), compared to -5.35% for the S&P 500 index [4] Zacks Recommendations - StoneCo Ltd. (STNE) and BlackBerry Limited (BB) advanced 30.9% and 26.1% respectively since their Zacks Recommendation upgrades to Outperform on April 9 and March 4 [7] - The Zacks Focus List portfolio has returned -3.23% through April 30, 2025, compared to -4.92% for the S&P 500 index [11] - The Zacks Earnings Certain Admiral Portfolio (ECAP) returned +3.20% in Q1 2025, outperforming the S&P 500 index's -4.30% decline [15] Long-term Performance - The Zacks Focus List portfolio has produced an annualized return of +11.33% since 2004, compared to +9.95% for the S&P 500 index [13] - The Top 10 portfolio has delivered a cumulative return of +1832.3% since 2012, significantly outperforming the S&P 500 index's +434.2% return [23]

Market Performance - The S&P 500 gained 6.1% in May, marking its best performance since an 8.9% rise in November two years ago [2] Employment and Labor Market - Economists expect a gain of 130,000 in nonfarm payrolls for May, with the unemployment rate remaining steady at 4.2% [5] - Wells Fargo economists indicate that May's employment report will reflect the labor market's response to recent trade uncertainties, with hiring appetite among firms remaining low [6][7] - New job postings on Indeed fell to their lowest level since 2020 in May, and hiring plans among small businesses are near cycle lows [7] Earnings Reports - Broadcom is expected to report a 43% year-over-year increase in profit and nearly 20% growth in revenue, driven by AI-related demand and strong semiconductor positioning [8] - CrowdStrike is anticipated to post EPS of $0.66 on revenue of $1.11 billion, with RBC analysts expressing optimism for software stocks in 2025 [10] Bond Market Concerns - Jamie Dimon warns of a potential crack in the bond market due to rising federal debt, urging the government to take remedial measures [11][12] - Dimon suggests that the timeline for a potential crisis could range from six months to six years [13] EV Market Performance - XPeng reported May deliveries of 33,525 Smart EVs, a 230% year-over-year increase, and a year-to-date total of 162,578 Smart EVs, up 293% [13] - Li Auto delivered 40,856 vehicles, up 16.66% year-over-year, while NIO delivered 23,231 vehicles, a 13.1% year-over-year increase [14] Financial Market Outlook - BofA indicates that financial markets are at a high-stakes inflection point, with risk assets poised for a significant move, either a breakout or a breakdown [16]

Core Viewpoint - Costco Wholesale continues to demonstrate strong performance in the retail sector, achieving significant revenue and earnings growth despite tariff challenges [1][3]. Financial Performance - Quarterly revenue increased by 8% to $63.21 billion, with adjusted earnings per share (EPS) rising 13% to $4.28, surpassing analyst expectations [5]. - Same-store sales rose 8% when adjusted for gasoline prices and foreign currency, with U.S. same-store sales up 7.9% and Canadian comparable-store sales climbing 7.8% [6]. - E-commerce revenue grew by 15.7% on an adjusted basis, indicating strong online sales performance [6]. Customer Experience Initiatives - The company is investing in technology to enhance the checkout process and has extended gas-station hours [4]. - A "buy now, pay later" program for big-ticket items has been introduced, showing initial promise [4]. Membership Growth - Membership-fee revenue increased by 10.4% to $1.24 billion, benefiting from a fee hike implemented in September [8]. - Memberships rose by 6.8% to 79.6 million paid households, with higher-cost executive memberships increasing by 9% [8]. Market Position - Costco's same-store sales growth outperformed competitors, with Target reporting a decline of 3.8% and Walmart achieving 4.5% growth [11]. - The company continues to gain market share as consumers are attracted to the value offered by warehouse stores [11]. Expansion Plans - Costco opened eight new locations in the quarter, bringing the total to 905 warehouse stores, with plans to open nine more in the upcoming quarter [10]. - Approximately 80% of new openings will be in high-traffic markets, which may cannibalize some existing store sales but will help alleviate congestion [10]. Valuation Insights - The stock trades at a forward price-to-earnings (P/E) ratio of 57.5, reflecting a premium valuation that has expanded significantly in recent years [12]. - Despite concerns over high valuation relative to revenue growth, the stock's momentum remains strong [15].

Core Insights - American Eagle Outfitters, Inc. (AEO) reported disappointing first-quarter fiscal 2025 results, with both revenue and earnings missing the Zacks Consensus Estimate and declining year over year [1][2] Financial Performance - AEO posted a loss of $0.29 per share, wider than the expected loss of $0.25, and a significant decline from earnings of $0.34 in the same quarter last year [1] - Net revenues were $1.09 billion, down 5% year over year, slightly missing the consensus estimate of $1.091 billion [4] - Consolidated comparable sales (comps) fell 3% in the quarter, with the company predicting a negative comp of 4.7% [4] Brand Performance - Revenues for the American Eagle brand decreased by 4.3% year over year to $693.9 million, with comps down 2% [5] - Aerie brand revenues fell 3.5% year over year to $359.8 million, with comps declining by 4% [5] Margins and Expenses - Gross profit decreased by 30.5% year over year to $322.4 million, with gross margin dropping to 29.6% from 40.6% in the prior year [6] - Selling, general and administrative (SG&A) expenses rose by 2% year over year to $338.8 million, with SG&A as a percentage of sales increasing by 190 basis points to 31.1% [8] Operating Loss - The company reported an adjusted operating loss of $85.2 million, a significant decline from adjusted operating earnings of $77.8 million in the prior year quarter [9] Financial Health - As of May 3, 2025, AEO had cash and cash equivalents of $87.8 million and long-term debt of $110 million, with total shareholders' equity at $1.5 billion [10] - Inventory decreased by 5% year over year to $645 million [10] Shareholder Returns - AEO launched a $200 million accelerated share repurchase (ASR) program, representing approximately 18.1 million shares or about 9.5% of the company's fully diluted outstanding shares [11] - The company also repurchased $31 million in shares in the open market and distributed $22 million in dividends [11] Future Outlook - AEO has withdrawn its fiscal 2025 outlook due to ongoing macroeconomic uncertainty [12] - For Q2 2025, the company expects revenues to decline by 5% and comps to decrease by 3%, with gross margin projected to be down year over year [13]