On Monday, October 9th at 2 PM we are hosting a 4Q23 Retail Themes call. Retail has traded down post the June/July squeeze (note our Whack A Mole on Retail Shorts deck: CLICK HERE). The sentiment seems to be net bearish, but we continue to think 'not bearish enough' on where retail earnings are headed over the next 12 months and how high the consensus expectations remain. A year ago the narrative was how soon will the Fed “pivot”? Yet now it’s when can the Fed stop hiking? THE XRT PE is down to 11x, but it’s hard to call that trough looking at a 10 year chart when you can get a 5% risk free return for the first time in 15 years. The cost of capital is up, multiples should be lower, particularly on an industry fueled by discretionary consumption when the savings incentive is at cycle highs and earnings expectations are still too high. Meanwhile the savings rate has come down for 3 months straight, as consumers have to face a rebound in energy inflation and we have yet to see the impact of student loan payments in the Gov spending data. We think there are still places to make money short side, and certain names where if you have duration it makes sense to be buying here today. We’ll run through how expectations have tracked and where they look doable vs aggressive including the outlook into 2024. As always, we’ll review the macro and consumer landscape analyzing the key points of debate we are hearing from investors in the retail space.
Call Details
Date/Time: Monday October 9th at 2PM EDT
Add To Calendar CLICK HERE
Live Video Link CLICK HERE
