Retail Callouts (7/10): FDO, Adi, NKE, JCP

Takeaway: FDO - little faith in core consumer. Adi releases 2nd fitness tracker...doubt we see a 3rd. Tough week for NKE soccer. RonJon speaks.



Friday (7/11)

  • PSMT - Earnings Call: 12:00pm




FDO - 3Q14 Earnings


Retail Callouts (7/10): FDO, Adi, NKE, JCP - chart2 7 10


Takeaway: Slight beat on the top line driven by a better than expected comp offset by  margin pressure due to sales mix (consumables penetration up 73bps), fixed cost deleverage, and increased ad spend led to the $0.04 EPS miss. We still have very little faith in FDO's core consumer.


AdiBok - Adidas Gets Smart



"Adidas unveiled Fit Smart, a fitness-training product worn on the wrist, at the Wearable Technologies Conference in San Francisco today...Fit Smart measures heart rate, calories, pace, distance and stride to calculate workout intensity."

"Fit Smart, which retails for $199, will be released in late August exclusively at Best Buy and, and then on"


Retail Callouts (7/10): FDO, Adi, NKE, JCP - chart1 7 10


Takeaway: Interesting move here by Adi given the moves made by its competition over the past 3-6 months. NKE appears to be walking away from fitness tracking hardware - choosing instead to outsource the design to Apple. UA won't be releasing another iteration of its Armour39 fitness tracker, deciding to partner with best-in-class products already on the market. This is the 2nd stab Adi has taken at the smartwatch/ fitness tracker, and our guess is that we won't see a 3rd. Sports brands have tried and failed repeatedly to establish a market presence in this growing category. Best to leave hardware to the Apples, FitBits and Jawbones of the world. 


AdiBok, NKE - Argentina Win Hands Adidas World Cup Win Before Final



"Argentina, sponsored by Adidas AG, triumphed on penalty kicks in Sao Paulo to eliminate a Dutch side outfitted by Nike Inc. of the U.S. In the final, it will face fellow Adidas-backed team Germany, which defeated Nike-supported Brazil 7-1 on July 8. The Herzogenaurach, Germany-based company also outfitted the Spanish team that won the last World Cup in 2010."


Takeaway: Tough week for NKE soccer. First the Brazil disaster, then ManU, and now an all Adi final.




JCP - Ron Johnson: ‘I was a terrible fit for J.C. Penney’



  • "Ron Johnson, who has been keeping a relatively low profile since he was ousted from J.C. Penney in April 2013, took to the podium in May, as a guest lecturer at Stanford University."
  • "’It was disappointing because I really believed we would make it work, but it was a relief because the lesson I learned is I was a terrible fit for J.C. Penney,’ he said. ‘I'm a creative person, here's a company that isn't uber-creative. I believe in change, this company’s much more comfortable, like many people are, with the status quo.’"


Full Video:


ZQK - Quiksilver Announces Additional Licensing Agreements



  • "Quiksilver, Inc. (NYSE: ZQK) today announced that it has entered into licensing agreements for several product categories, including Roxy young girls and children’s apparel, watches and socks/legwear, as well as other product categories including luggage, beach towels and surfboards."


DSW - New DSW Designer Shoe Warehouse Stores Open in Canada



  • "Town Shoes Limited is excited to announce the opening of its first two DSW Designer Shoe Warehouse locations in Canada. DSW Designer Shoe Warehouse will open at Heartland Centre in Mississauga and Woodland Hills in Newmarket, Ontario, on August 7."


AAP - American Apparel Signs Support Agreement with Standard General



  • "American Apparel, Inc. announced it has reached a Nomination, Standstill and Support Agreement with Standard General L.P. and company founder Dov Charney, the beneficial owners of nearly 44% of the Company's outstanding stock. Under the agreement, Standard General will provide up to $25 million in immediate financial support to the Company, the Company's board will be reconstituted..."


LE - Lands’ End deploys Fit Predictor to help online shoppers get best fit



  • "Lands’ End has deployed Secret Sauce’s Fit Predictor service, which proactively finds a customer's best fit in seconds using existing data, without the need for physical measurements."
  • "For new customers without a shopping history, the service can predict the best fit based on the customer's sizing with other brands."


BEBE - Apparel retailer Bebe stores revamps management board



  • "bebe stores, inc. announced that Seth Johnson, Blair Lambert and Brett Brewer have replaced Caden Wang, Barbara Bass and Cynthia Cohen on the Company’s Board of Directors, effective immediately."

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.”

read more

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.

read more

Cartoon of the Day: Crash Test Bear

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

read more

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.

read more

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

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

read more

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.

read more

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."

read more

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.

read more

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."

read more

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.

read more

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.

read more

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.

read more