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McCullough: One Thing That Could Trigger a Recession


In this excerpt from today’s Real-Time Alerts Live show, Hedgeye CEO Keith McCullough responds to a subscriber’s question about whether a U.S. recession is coming. 


CLICK HERE to subscribe to Real-Time Alerts. With your subscription you'll receive all of Keith's #timestamped signals sent right to your inbox, as well as full access to this and all other RTA Live episodes. 

Monday Mashup: BWLD, SBUX and More

Monday Mashup: BWLD, SBUX and More - 1


Recent Notes

12/22/14 Monday Mashup: BOBE, RT and More

12/23/14 Industry-Wide Comp Outlook (2015)

12/23/14 Statement Analysis (Replay)

12/29/14 Monday Mashup: 'Tis the Season

Events This Week

Tuesday, January 6th

  • SONC earnings call 5pm EST

Thursday, January 8th

  • RT earnings call 5:00pm EST


Chart of the Day

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Recent News Flow

This Morning

  • BOBE upgraded to buy at Janney Capital with a $60 PT.
  • DPZ upgraded to buy at Janney Capital with a $110 PT.
  • LOCO upgraded to outperform at RW Baird with a $34 PT.
  • PBPB upgraded to outperform at RW Baird with a $17 PT.
  • BWLD PT increased to $205 from $180 at UBS.
  • BWLD downgraded to neutral at RW Baird with a $180 PT.
  • SBUX downgraded to neutral at Janney Capital with an $85 PT.

Monday, December 29th

  • SONC announced a new agreement (with Fast Eats, LLC) for franchise development of eight new drive-ins in the Albany, NY, area over the next seven years.
  • DFRG Double Eagle Steak House was named to OpenTables list of the 100 best restaurants and 100 best steakhouses in America.
  • DAVE announced the closure of three restaurants in the Richmond, VA area and anticipates incurring impairment charges at up to four additional company-owned restaurants. The closure of the three Richmond locations would have been accretive to full-year diluted adjusted EPS by $0.04 and same-store sales by +0.5% had they been closed at the beginning of the year.
  • COSI director Michael O'Donnell announced his departure, effective Jan. 1st.  Mr. O'Donnell will be replaced by an independent restaurant expert, David Lloyd, of Highland Consumer Fund.


Sector Performance

The XLY (-0.3%) outperformed the SPX (-1.1%) last week, as both casual dining and quick service stocks, in aggregate, outperformed the XLY.

Monday Mashup: BWLD, SBUX and More - 3

Monday Mashup: BWLD, SBUX and More - 4


XLY Quantitative Setup

From a quantitative perspective, the XLY remains bullish on an intermediate-term TREND duration.

Monday Mashup: BWLD, SBUX and More - 5


Casual Dining Restaurants

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Monday Mashup: BWLD, SBUX and More - 7


Quick Service Restaurants

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Monday Mashup: BWLD, SBUX and More - 9

McCullough: Why Consensus Is (Still) Getting Bamboozled By Bonds

Editor’s note: This is a brief excerpt from CEO Keith McCullough’s live Real-Time Alerts broadcast earlier today. For more info on how you can subscribe to Real-Time Alerts click here.

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We like bonds. We like TLT. It’s been a huge call for our macro team and we make no apology for it.


The reality is that being long bonds today, yesterday, the day before that, the month before that has been awesome. Just awesome. It has bamboozled consensus which still doesn’t get it. 

McCullough: Why Consensus Is (Still) Getting Bamboozled By Bonds - rta55

When you have global growth slowing (which we don’t think the U.S. will decouple from) and deflation—the two core things that the bond market cares about, growth and inflation slowing at the same time—you buy bonds. And you buy more. And you buy them on pullbacks.


Early Look

daily macro intelligence

Relied upon by big institutional and individual investors across the world, this granular morning newsletter distills the latest and most vital market developments and insures that you are always in the know.

January 5, 2015


In the first RTA Live session of 2015, Keith discusses the positions in Real Time Alerts as of 10:30AM ET on January 5, 2015 and answers subscriber questions live on the air.


Takeaway: December under the hood: no relief in sight


While December was partially a throw away month, the details behind the headline 30% decline were not uplifting.  Adjusting for the reclassification of some premium mass tables to direct VIP to circumvent the smoking ban, mass revenues still likely declined at least high single digits. VIP hold percentage approximated normal so bad luck could not be blamed. And while the Chinese President’s visit certainly had a negative impact, it wasn’t as clear cut as universally expected. GGR fell by a similar percentage in the 1st and 2nd halves of the month and there wasn’t much of a pick up after he left.


Following the relief rally in the stocks immediately after the President’s visit, we’re back on the negative side of the trade/trend. Our forecast calls for 9 more months of negative growth with February as the nadir.  Unfortunately, forward EBITDA estimates remain stubbornly high, substantial risk remains and no positive catalysts are apparent.


Please see our detailed note:  http://docs.hedgeye.com/HE_Macau_1.5.15.pdf

Keith's Macro Notebook 1/5: Euro | Oil | UST 10YR


Hedgeye CEO Keith McCullough shares the top three things in his macro notebook this morning.

Hedgeye Statistics

The total percentage of successful long and short trading signals since the inception of Real-Time Alerts in August of 2008.

  • LONG SIGNALS 80.48%
  • SHORT SIGNALS 78.35%