To The Moon

Sprouts Farmers Market has surged 470% since I became bullish in 2021, driven by superior management and a bifurcating grocery industry. Despite its high valuation, SFM's strong growth potential and market shift away from middle-market grocers like Kroger and Albertson's continued double-digit sales growth. Projecting its growth into the 2030s, Sprouts may be reasonably valued today, given that its sales are currently far below its expanding total addressable market. Sprouts is far more expensive than Kroger and Albertsons, but is likely undervalued to Costco. Compared to Costco, Sprouts has more recession risk but far superior long-term growth potential. SFM's current valuation appears risky due to potential demand fluctuations and fickle short-term momentum traders. Kobus Louw In 2021, S

Whirlpool faces potential short-term strains but possible long-term benefits from the Trump administration's efforts to improve US manufacturing activity. Despite recent financial struggles, including high debt and low margins, WHR's valuation reflects its risks, with analysts predicting a margin recovery after 2025. US manufacturing's post-pandemic recession and low home sales are significant challenges, but a supportive regulatory environment could aid Whirlpool's future growth. I cautiously upgrade my view on WHR to mildly bullish. I expect pressures in the short term but see it as a reasonable long-term value investment. simonkr/E+ via Getty Images From 2018 to 2023, the US had a tariff policy on washing machines. The tariff was initially set at 20% for the first 1.2M units and 50% abo

Cameco Corporation reported a non-GAAP EPS of -$0.01 and substantial revenue of $721M, up ~25% YoY, with a positive financial outlook and increased dividend. Operational improvements and the reopening of the McArthur River/Key Lake mine boosted the 2024 production outlook despite supply issues in Kazakhstan. The uranium market is supply side-driven; Cameco's long-term contracts and potential supply disruptions in Kazakhstan could keep uranium prices high, improving CCJ's income years from now. If supply conditions in Kazakhstan normalize, as expected, the market seems to be headed back into a glut, pushing uranium back below $60-$70 per pound. Cristian Martin/iStock via Getty Images The uranium (UXA:COM) mining giant Cameco Corporation

Trump's Polymarket election odds have a 73% R-squared to the 10-year Treasury rate, indicating that a Trump win would lower high-duration bond prices. A Republican sweep of the House and Senate may exacerbate losses by making deficit spending policies more feasible. However, the same can be argued for a Democrat sweep. My long-term view on high-duration Treasury bonds is decidedly bearish, given the bipartisan consensus against fiscal responsibility and pro-inflationary Fed policies. The bond-Trump correlation may result from foreign investment risk, with China potentially divesting US Treasuries in a trade conflict. The manufacturing economy is in a recession, but the service economy has strengthened, creating a complex outlook for 2025 unemployment. J Studios There is much speculation re

Fannie Mae and Freddie Mac continue fluctuating with election odds and face immense volatility risk over the coming week. FNMA has been down since June, as Harris's ascent has lowered Trump's odds. Its Q3 results were slightly disappointing and indicated some risk in multifamily. Although the election matters over the short term, I think FNMA's 2030 value is more dependent on the economic trend and whether or not the housing market has a "soft landing." Home valuation and multifamily cap rates are unsustainably high today but were previously supported by low vacancy rates and single-family inventories. With vacancies and inventories rising, I expect housing valuations will decline in 2025-2027. Given high mortgage coverage ratios, FNMA should be safe if they do not fall too quickly. ablokh

Given Albertsons' significant discount to Kroger's merger price, it appears highly unlikely that the deal will be completed. With the FTC's effort to ensure the merger lacks pricing power advantages, I believe KR is better off without the debt-laden company. Kroger may benefit if ACI closes stores or lay-offs employees, as it has suggested as a long-term result of a failed merger. Lower agricultural input costs lift the Company's gross margins, but to improve its market position, it needs to vertically integrate and invest in private-label branding. In the long run, Kroger will likely need significant investment to adapt to consumer bifurcation trends, which benefit wholesale and premium grocers more than those "stuck in the middle." jetcityimage/iStock Editorial via Getty Images Kroger (N

Builders FirstSource fell by 7% on Tuesday, a week before its Q3 report, potentially reflecting potential investor sentiment shifts and macroeconomic concerns impacting homebuilding demand. With mortgage rates failing to decline and home inventories increasing, there are more signs that builders will pull back on lower new home sales prices. Builders FirstSource risks a significant decline in its profit margins as it loses sales and pricing power if the industry shifts back toward a materials glut. The company has had excellent core growth through accretive acquisitions but faces a potential slowdown with much higher debt and lackluster cash savings. Thomas Bullock/iStock via Getty Images The construction materials company Builders FirstSource, Inc. (NYSE:

Summary Gasoline prices are down again due to global demand concerns. The average US retail gas price is $3.3, down from nearly $3.8 in May. This year, energy is the worst-performing sector, as investors view oil as cyclical after 2008 and 2020 despite its historically non-cyclical pattern. The Federal Reserve's surprisingly quick dovish shift and geopolitical should encourage investors to look toward supply side inflation hedges. Chevron's strong balance sheet, low debt-to-equity ratio, and strategic acquisitions position it well for future growth despite its slightly higher valuation. In a recession, Chevron's diversified operations and consistent dividend make it a safer bet, particularly given US drilling activity has already declined due to concerns of a slowdown that may not occur. N

Summary PulteGroup's high valuation and profit margins are unsustainable due to low home affordability and a fading housing shortage, making it a potential short opportunity. Despite strong recent performance, PulteGroup's backlog and new orders are declining, signaling reduced demand and increased risk exposure. The Federal Reserve's interest rate cuts should not significantly lower mortgage rates, meaning home affordability is unlikely to improve without lower prices. PulteGroup's aggressive investment in new projects amidst economic uncertainty could exacerbate losses if the economy enters a broader recession, though a 2008-repeat is unlikely for numerous reasons. krblokhin The home construction industry faces a strange mix of trends today; some support the market, while others are a gr

Summary Synchrony Financial faces risks from declining consumer credit and a potential economic recession, which should slow loan originations and may increase defaults. Despite slightly elevated delinquency rates, Synchrony's high interest rates provide a cushion, but its high loan-to-deposit ratio and unsecured loans pose risks. Consumer borrowing and spending are slowing, and low personal savings could potentially increase demand for credit and long-term default risks. I am bearish on SYF due to its exposure to negative economic headwinds, which I expect will increase its delinquencies over the coming year. J. Michael Jones A key theme to my outlook is the decline in consumer credit lending associated with potential recession risk. After being calm for most of the 2010s, consumer lendin