Core Viewpoint - Tariffs create significant uncertainty for businesses and investors, impacting stock market predictions and evolving weekly [1] Group 1: Walmart - Walmart has substantial vendor power to influence prices and can pass costs to consumers if necessary [4] - The retailer's sales increased by 2.5% year-over-year to $165.6 billion, with operating income rising by 4.3% to $7.1 billion [6] - Despite a high valuation at over 40 times trailing earnings, Walmart is considered a safer retail stock under current macroeconomic conditions [7] Group 2: Home Depot - Home Depot does not anticipate raising prices due to tariffs, as suppliers can source goods from multiple countries [9] - The company expects single-digit sales growth of 2.8% for the current fiscal year, with comparable sales rising by 1% [10] - With shares down 7% this year, Home Depot's valuation at a P/E of 25 is modest and aligns with the S&P 500 average [11] Group 3: Microsoft - Microsoft has low tariff risk, generating around 22% of revenue from product sales, with most coming from services [12] - The company reported a 15% revenue increase to over $70 billion in its April quarter, with Azure and cloud services sales rising by 35% [13] - Although trading at a P/E of 35, Microsoft's diversification and financial strength make it a strong growth stock for long-term investment [14]

Market Overview - The stock market began positively on Monday but experienced a decline due to increasing tariff risks [1] - As of noon ET, the market is slightly down as investors are becoming more cautious about the impact of tariffs [1] Company Performance - Earnings from Domino's (DPZ) have contributed to the market's downturn, indicating a pullback in consumer spending on pizza [1] - Domino's stock is down by 0.92% [1]

Core Viewpoint - BofA Securities analyst Vivek Arya identifies three top diversified semiconductor picks, indicating a near bottom for the industry with industrial semiconductors leading the recovery, followed by auto semiconductors in late 2025 [1] Group 1: Top Picks and Performance - Arya's top picks in order of recovery potential are Analog Devices, Inc (ADI) with a $280 price target, NXP Semiconductors (NXPI) at $235, and ON Semiconductor Corp (ON) at $60 [2] - Analog Devices has outperformed the PHLX Semiconductor Sector 23 out of the last 29 times the index declined over 10% since 2010, making it a strong defensive choice [3] - NXP Semiconductors has a relatively shallow sales peak-to-trough correction of -18%, indicating prudent execution and growth potential from product cycles [5] Group 2: Financial Metrics and Projections - Analog Devices' industrial sales are still 15-20% below trend based on fiscal 2018 and 2019 baselines, suggesting significant upside potential [4] - The company is expected to achieve 37% margins in fiscal 2025, significantly higher than peers' average of 17%, with potential for buybacks to double due to a new $10 billion authorization [4] - ON Semiconductor's estimates show a -15% sales decline for calendar 2025, which is below peers' range of -13% to +13%, but the stock is seen as compelling due to high leverage to improvements in Auto/EV sentiment [6] Group 3: Market Conditions and Strategic Moves - Arya acknowledges risks related to tariffs and economic contraction but notes that diversified stocks tend to outperform during significant declines in the SOX index [2] - Allegro MicroSystems, Inc's potential deal could provide 4%-7% accretion by calendar 2027, enhancing the sensor portfolio [7] - Despite current downturns, ON Semiconductor's free cash flow percentage could improve to mid-20% from 17% in calendar 2024, indicating resilience [7]