Notable news items/price action from the past twenty-four hours.

  • SBUX will begin selling instant coffee in China next month.   The stock gained 1.4% yesterday, outperforming QSR peers, on accelerating volume. 
  • SONC was upgraded to Neutral from Negative at Susquehanna.  Yesterday the company announced its estimate that second fiscal quarter same-store sales increased 1.0%-1.5% for the quarter, continuing the improving sales trend from the first quarter.
  • EAT gained 4.3% on strong volume following yesterday morning’s upgrade from UBS on stabilizing Chili’s trends.
  • DIN declined 5% on accelerating volume.  DIN spoke at the RJ conference yesterday.
  • CMG was downgraded to Underperform from Hold at Jeffries.  Rising food cost inflation was cited as the reason behind the change and the price target provided was $198.
  • CBRL gained 50 basis points on accelerating volume but will likely underperform if oil trends higher. 
  • MCD U.S. comps came in at +2.7% versus the estimate of +4.0%.  I will have a more detailed post on this later this morning.
  • TAST trading up on accelerating volume - Burger King gaining some traction?
  • An interesting story on NRN.com highlights growing scrutiny restaurant companies are being placed under about the legal status of their workers.  Pei Wei Asian Diner is the latest target of investigation in this regard following the (ongoing) investigation of CMG that came to light recently.



Howard Penney

Managing Director

Did the US Economy Just “Collapse”? "Worst Personal Spending Since 2009"?

This is a brief note written by Hedgeye U.S. Macro analyst Christian Drake on 4/28 dispelling media reporting that “US GDP collapses to 0.7%, the lowest number in three years with the worst personal spending since 2009.”

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7 Tweets Summing Up What You Need to Know About Today's GDP Report

"There's a tremendous opportunity to educate people in our profession on how GDP is stated and projected," Hedgeye CEO Keith McCullough wrote today. Here's everything you need to know about today's GDP report.

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Cartoon of the Day: Crash Test Bear

In the past six months, U.S. stock indices are up between +12% and +18%.

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GOLD: A Deep Dive on What’s Next with a Top Commodities Strategist

“If you saved in gold over the past 20 to 25 years rather than any currency anywhere in the world, gold has outperformed all these currencies,” says Stefan Wieler, Vice President of Goldmoney in this edition of Real Conversations.

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Exact Sciences Up +24% This Week... What's Next? | $EXAS

We remain long Exact Sciences in the Hedgeye Healthcare Position Monitor.

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Inside the Atlanta Fed's Flawed GDP Tracker

"The Atlanta Fed’s GDPNowcast model, while useful at amalgamating investor consensus on one singular GDP estimate for any given quarter, is certainly not the end-all-be-all of forecasting U.S. GDP," writes Hedgeye Senior Macro analyst Darius Dale.

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Cartoon of the Day: Acrophobia

"Most people who are making a ton of money right now are focused on growth companies seeing accelerations," Hedgeye CEO Keith McCullough wrote in today's Early Look. "That’s what happens in Quad 1."

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People's Bank of China Spins China’s Bad-Loan Data

PBoC Deputy Governor Yi says China's non-performing loan problem has “pretty much stabilized." "Yi is spinning. China’s bad-debt problem remains serious," write Benn Steil and Emma Smith, Council on Foreign Relations.

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UnderArmour: 'I Am Much More Bearish Than I Was 3 Hours Ago'

“The consumer has a short memory.” Yes, Plank actually said this," writes Hedgeye Retail analyst Brian McGough. "Last time I heard such arrogance was Ron Johnson."

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Buffalo Wild Wings: Complacency & Lack of Leadership (by Howard Penney)

"Buffalo Wild Wings has been plagued by complacency and a continued lack of adequate leadership," writes Hedgeye Restaurants analyst Howard Penney.

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Todd Jordan on Las Vegas Sands Earnings

"The quarter actually beat lowered expectations. Overall, the mass segment performed well although base mass lagging is a concern," writes Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan on Las Vegas Sands.

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An Update on Defense Spending by Lt. Gen Emo Gardner

"Congress' FY17 omnibus appropriation will fully fund the Pentagon's original budget request plus $15B of its $30B supplemental request," writes Hedgeye Potomac Defense Policy analyst Lt. Gen Emerson "Emo" Gardner USMC Ret.

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