LEISURE LETTER (06/11/2015)

TICKERS: HOT, MGM

COMPANY NEWS  

Neptune - denied that it is laying off 300 layoffs of workers by the end of this month.  They added: “Because of the large number of employees and the high turnover rate of employees, [we have had] 100 [or] 200 employees who resign or are let go each year for different reasons in the past few years. This year so far the number of employees who resign or are laid-off is similar to the level of the past few years, contradictory to the online rumors that 300 employees will be sacked by end of this month. The relevant media reports are unfounded.”

ARTICLE HERE

Takeaway: Attrition - the only way politically to reduce headcount

 

HOT - announced plans to debut in South Australia with the signing of Aloft Adelaide in the state capital. Owned by local developer, Sturt Land Pty Ltd, a joint venture between local construction group Tagara and Melbourne-based developer Colvid, the signing of Aloft Adelaide marks the Aloft brand’s third property to enter the Australian market.

ARTICLE HERE

 

MGM – CEO of MGM China operations, Grant Bowie commented on possible merger speculation with WYNN. “This report was mere speculation and frankly we don’t comment on speculation. I don’t think it does us any good to continue these discussions.”

Takeaway:  The idea of a merger sounded far fetched but Bowie didn't deny the possibility either. 

 

Bloomberry – CEO Razon, said he would be willing to invest in a new international airport in Manila to boost tourism in the country.

ARTICLE HERE

 

INDUSTRY NEWS

New Zealand – saw 10% cruise passenger growth in 2014. Considered the third fastest growing cruise passenger market next to Australia (20.4%), and France (13.6%).

ARTICLE HERE 

MACRO

China Industrial Output (May) - actual +6.1%; consensus +6.0%

China Retail Sales (May) – actual +10.1%; consensus +10.2%  

 

Hedgeye Macro Team remains negative on Europe, their bottom-up, qualitative analysis (Growth/Inflation/Policy framework) indicates that the Eurozone is setting up to enter the ugly Quad4 in Q4 (equating to growth decelerates and inflation decelerates) = Europe Slowing.

Takeaway:  European pricing has been a tailwind for CCL and RCL but a negative pivot here looks increasingly likely in 2015.


Cartoon of the Day: Hard-Headed Bears

How's this for "hard data"? So far, 107 of 497 S&P 500 companies have reported aggregate sales and earnings growth of 4.4% and 13.2% respectively.

read more

Premium insight

McCullough [Uncensored]: When People Say ‘Everyone is Bullish, That’s Bulls@#t’

“You wonder why the performance of the hedge fund indices is so horrendous,” says Hedgeye CEO Keith McCullough, “they’re all doing the same thing, after the market moves. You shouldn’t be paid for that.”

read more

SECTOR SPOTLIGHT Replay | Healthcare Analyst Tom Tobin Today at 2:30PM ET

Tune in to this edition of Sector Spotlight with Healthcare analyst Tom Tobin and Healthcare Policy analyst Emily Evans.

read more

Ouchy!! Wall Street Consensus Hit By Epic Short Squeeze

In the latest example of what not to do with your portfolio, we have Wall Street consensus positioning...

read more

Cartoon of the Day: Bulls Leading the People

Investors rejoiced as centrist Emmanuel Macron edged out far-right Marine Le Pen in France's election day voting. European equities were up as much as 4.7% on the news.

read more

McCullough: ‘This Crazy Stat Drives Stock Market Bears Nuts’

If you’re short the stock market today, and your boss asks why is the Nasdaq at an all-time high, here’s the only honest answer: So far, Nasdaq company earnings are up 46% year-over-year.

read more

Who's Right? The Stock Market or the Bond Market?

"As I see it, bonds look like they have further to fall, while stocks look tenuous at these levels," writes Peter Atwater, founder of Financial Insyghts.

read more

Poll of the Day: If You Could Have Lunch with One Fed Chair...

What do you think? Cast your vote. Let us know.

read more

Are Millennials Actually Lazy, Narcissists? An Interview with Neil Howe (Part 2)

An interview with Neil Howe on why Boomers and Xers get it all wrong.

read more

6 Charts: The French Election, Nasdaq All-Time Highs & An Earnings Scorecard

We've been telling investors for some time that global growth is picking up, get long stocks.

read more

Another French Revolution?

"Don't be complacent," writes Hedgeye Managing Director Neil Howe. "Tectonic shifts are underway in France. Is there the prospect of the new Sixth Republic? C'est vraiment possible."

read more

Cartoon of the Day: The Trend is Your Friend

"All of the key trending macro data suggests the U.S. economy is accelerating," Hedgeye CEO Keith McCullough says.

read more