Core Viewpoint - Archer Daniels Midland Company (ADM) is facing significant challenges due to a dynamic market landscape, weak conditions, tariffs, and trade policy uncertainty, particularly in its Ag Services and Oilseeds unit [1][4]. Financial Performance - ADM's shares have declined by 19% over the past year, underperforming the Consumer Staples sector's increase of 5.9% and the S&P 500 index's increase of 10.7% [2]. - The stock's decline is more pronounced than the Agriculture - Operations industry's dip of 1.8% [2]. Segment Performance - The Ag Services and Oilseeds segment is experiencing headwinds from market dislocations, increased cost inflation, and lower margins in the Crushing subsegment due to elevated industry capacity and competitive meal exports from Argentina [4]. - In the Refined Products and Other segment, biodiesel margins are negatively impacted by biofuel and trade policy uncertainty, weak oil demand, and higher crush capacity [5]. Market Challenges - Ongoing price weakness in main feed ration commodities and compliance with evolving regulations are significant deterrents for the company [6]. - Management has noted signs of weakening customer demand, particularly in carb solutions, leading to reduced volume expectations for certain markets and products [7]. Earnings Outlook - Management has not provided a segment operating profit outlook for future quarters due to tariff policy uncertainty and macroeconomic conditions [8]. - For 2025, adjusted earnings per share are projected to be between $4 and $4.75, with expectations leaning towards the lower end [8]. - The Zacks Consensus Estimate for 2025 EPS has decreased by 4% to $4.07, and for 2026, it has dropped by 4.6% to $4.61 [9]. Strategic Initiatives - Despite current challenges, ADM is implementing strategies to return to growth by managing productivity, innovation, and aligning with trends in food security and health [11]. - The company is focusing on strengthening internal controls, improving operational performance, and simplifying its portfolio to enhance core competencies [11].

Group 1 - Economic uncertainty can present significant investment opportunities, particularly in the oil and natural gas sector [1] - Crude Value Insights focuses on cash flow and identifies companies with strong value and growth prospects [1] - The service offers a model account with over 50 stocks, detailed cash flow analyses of exploration and production firms, and live sector discussions for subscribers [2] Group 2 - A two-week free trial is available for new subscribers, providing access to insights in the oil and gas industry [3]

Core Viewpoint - Walmart has demonstrated strong performance in the retail sector, with significant growth in e-commerce and a focus on value, making it an attractive option for investors despite a slowdown in overall growth [1][10][15]. Group 1: Performance Metrics - Walmart's stock increased by 71.9% last year, outperforming the S&P 500 and the Dow Jones Industrial Average [1]. - Year-to-date, Walmart has achieved a 6.7% gain, contrasting with a 2.1% decline in the S&P 500 [1]. - In the first quarter of fiscal 2026, Walmart's global e-commerce sales grew by 22%, while total constant currency revenue grew by 4% [4]. Group 2: E-commerce and Business Strategy - Walmart's comparable sales in the U.S. grew by 4.5%, with 350 basis points attributed to e-commerce [5]. - The company has successfully improved e-commerce profitability for the first time in Q1, indicating a positive shift in its business model [9]. - Walmart's delivery options have expanded significantly, with U.S. deliveries in less than three hours growing by 91% year-over-year [9]. Group 3: Competitive Positioning - Walmart's value-focused strategy allows it to leverage its extensive store network and supply chain to compete effectively with Amazon on pricing [8]. - The company is positioned well to attract cost-conscious consumers amid inflation and economic uncertainty [4][6]. - Walmart's emphasis on efficiency and cost management is crucial for maintaining competitiveness against digitally native retailers like Amazon [7]. Group 4: Growth Outlook and Valuation - Walmart's forecast for fiscal 2026 indicates a 4% increase in net sales and a less than 2% increase in adjusted earnings per share, reflecting a slowdown in growth [12]. - The company's price-to-earnings (P/E) ratio stands at 41.2, suggesting that the stock is priced for high growth despite slower overall business growth [13][16]. - The low dividend yield of 1% may deter new investors, as the stock price has risen faster than the dividend [15].

Core Insights - Swiss brand On is emerging as a global challenger in the sportswear market, reporting a net sales increase of over 40% to 726.6 million Swiss francs (US$869 million) for the three-month period ended March 31 compared to the previous year [1] - The brand has successfully captured market share from established competitors like Nike and Adidas through innovative product designs and favorable market timing [1][2] - Nike and Adidas still hold a combined 58% of global market share, while On accounts for less than 3%, but On's earnings growth rate has outpaced both companies in recent quarters [3] Company Performance - On's initial success was driven by the unique aesthetic of its shoes, which stood out in the market [2] - The company benefited from a shift in retailer focus towards emerging, high-growth brands during the years following its 2021 IPO [3] Competitive Landscape - Nike is currently implementing a turnaround plan under new CEO Elliott Hill, which could present challenges for On [3] - The sportswear industry, including On, faces uncertainty regarding tariffs, particularly as 90% of On's sneakers are manufactured in Vietnam, which could be subject to a 46% import duty [4]

Group 1 - Provident Financial Services, Inc. (PFS) is expected to navigate current tariff-related uncertainties effectively [1] - The company has a strong loan pipeline, which is anticipated to result in good loan growth [1]

Core Viewpoint - Copart's shares declined by 12% following the release of earnings that showed an 8% growth in sales and earnings per share, which fell short of analysts' expectations [1][2] Company Performance - Copart's earnings report indicated a sales growth of 8%, but this was below market expectations, leading to a significant drop in stock price [1] - The company was trading at 43 times earnings prior to the report, reflecting high expectations for continued double-digit sales growth [2] Market Position - Copart is recognized as the leading online vehicle auction platform, facilitating transactions for various types of vehicles, including end-of-life cars and totaled vehicles [3] - Since its IPO in 1994, Copart has achieved a remarkable 398-bagger status, with an annualized total return of 21% [3] Economic Factors - Management highlighted that macroeconomic uncertainties, including tariffs, could influence the business positively by making repairs less attractive compared to total loss scenarios [5] - Increased costs for replacement parts due to tariffs may lead insurers to classify vehicles as "totaled," thereby increasing demand for Copart's auction services [6] Investment Considerations - Despite the recent stock decline, Copart continues to trade at a premium, currently at 36 times earnings, which reflects its strong market position and historical success [6]

Core Viewpoint - Deckers Outdoor Corporation's shares are experiencing a decline following the release of its fourth-quarter financial results for FY25, which, despite beating analyst expectations, led to downgrades from analysts due to increased uncertainty and a soft outlook for Q1 FY26 [1][2][3]. Financial Performance - The company reported fourth-quarter revenue of $1.02 billion, surpassing analyst estimates of $1.01 billion, and earnings of $1 per share, exceeding estimates of 59 cents per share [1]. - For the first quarter of FY26, Deckers expects revenue between $890 million and $910 million, below the estimate of $925.86 million, and earnings between 62 cents and 67 cents per share, compared to the estimate of 81 cents per share [2]. Analyst Downgrades - KeyBanc analyst Ashley Owens downgraded Deckers from Overweight to Sector Weight, citing concerns about HOKA's future sales trajectory and a notable slowdown in growth [3][5]. - Telsey Advisory Group analyst Dana Telsey also downgraded the company to Market Perform from Outperform and reduced the price forecast from $240 to $120 [5]. Market and Strategic Concerns - Analysts highlighted weaker customer acquisition, macroeconomic pressures, and a strategic shift toward wholesale expansion as factors that may dilute brand momentum [4]. - Recent price increases could negatively impact consumer demand, and HOKA's growth has decelerated faster than expected, although UGG's performance helped offset some of this slowdown [6]. Revenue Outlook and Stock Performance - The revenue outlook remains uncertain due to unpredictable consumer responses to pricing increases in the retail sector, with analysts noting potential margin headwinds from a shift toward wholesale and increased tariff costs [6][7]. - Following the downgrades, DECK shares fell by 19.9% to $100.94 [7].

Best Buy Co., Inc. ( BBY ) is expected to report the company’s fiscal Q1 results from the February-April period in late May. While the quarter’s outlook is weak, I believe that investors should look forward more – current tariff uncertainty createsI am an avid investor with a major focus on small cap companies with experience in investing in US, Canadian, and European markets. My investment philosophy to generating great returns on the stock market revolves around identifying mispriced securities by underst ...

Core Viewpoint - Johnson & Johnson (J&J) is facing multiple challenges including declining sales in its MedTech segment, loss of exclusivity for its drug Stelara, and ongoing talc lawsuits, while also navigating a volatile macroeconomic environment [1][2][26] Company Strengths and Weaknesses - J&J's diversified business model is a significant strength, operating through pharmaceuticals and medical devices with over 275 subsidiaries, which helps it withstand economic cycles [4] - The separation of its Consumer Health business into Kenvue allows J&J to focus on its core pharmaceutical and medical device operations [5] Innovative Medicine Unit - J&J's Innovative Medicine unit is experiencing growth, with sales increasing by 4.4% in Q1 2025 despite the loss of exclusivity for Stelara [6] - The company anticipates generating over $57 billion in sales from the Innovative Medicines segment in 2025, with expected growth of 5-7% from 2025 to 2030 [7] - J&J has identified 10 new products with potential peak sales of $5 billion, including cancer drugs and pipeline candidates [8] Patent Expiration and Sales Impact - The loss of U.S. patent exclusivity for Stelara in 2025 is expected to significantly impact sales, which were $10.36 billion in 2024, with a projected decline of 33.7% in Q1 2025 [9][10] - The introduction of biosimilars is anticipated to further erode Stelara's sales throughout 2025 [11] MedTech Segment Challenges - J&J's MedTech sales are facing headwinds, particularly in the Asia Pacific region, with challenges from China's volume-based procurement program and competitive pressures [12][13] - No improvement is expected in the Asia Pacific region for 2025, with ongoing impacts from the VBP program [13] Legal Issues - J&J is dealing with over 62,000 lawsuits related to its talc-based products, which allege that these products contain asbestos [14] - A bankruptcy court recently rejected J&J's proposed plan to settle these lawsuits, forcing the company to revert to traditional legal proceedings [15] Stock Performance and Valuation - J&J's stock has outperformed the industry year-to-date, rising 6.8% compared to a 2.7% decline in the industry [16] - The stock is reasonably priced with a price/earnings ratio of 14.25, slightly below the industry average of 14.79 [19] Future Outlook - J&J considers 2025 a "catalyst year" for growth, expecting operational sales growth to accelerate in the second half of the year [24] - The company has a promising R&D pipeline and has recently made acquisitions to strengthen its market position [25]

21 May 2025 | 10:11PM IST Goldman Sachs Asia in Focus India: Towards a better growth-inflation balance Santanu Sengupta +91(22)6616-9042 | santanu.sengupta@gs.com Goldman Sachs India SPL Arjun Varma +91(22)6616-9043 | arjun.varma@gs.com Goldman Sachs India SPL Andrew Tilton +852-2978-1802 | andrew.tilton@gs.com Goldman Sachs (Asia) L.L.C. Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification and other important disclosures, see the Disclo ...