prev

HIBB: Removing Hibbett Sports from Investing Ideas (SHORT)

Takeaway: We are removing Hibbett Sports (HIBB) from Investing Ideas (SHORT).

Please be advised that we are removing HIBB (as a short) from Investing Ideas today. According to Hedgeye CEO Keith McCullough:

 

Oversold, finally – and I wanted to take the short idea off after a big market correction. We can always put it back on higher. Retail Sector Head Brian McGough's research view has not changed.

 

HIBB: Removing Hibbett Sports from Investing Ideas (SHORT) - z hibb


The #1 Thing In My Macro Notebook Today (No, It's Not Greece)

Editor's Note: This is an excerpt from Hedgeye morning research. Click here for more info.

*  *  *  *  *  *  *

The #1 Thing In My Macro Notebook Today (No, It's Not Greece) - z china 06.30.15 chart

 

Some sneaky central planning dudes in Beijing stole the Greek headlines overnight by floating some rumor action (National Pension Fund buying!) out there. Yep. That’ll get your attention in an illiquid market. This fueled the biggest intraday move in the Shanghai Composite Casino since 1992!

 

Shanghai closed up +5.5% after being down 14% in the three prior days. Ex-Thailand (down -0.9%) Asian Equities were pretty much green across the board.

 

If you’re trading China and you don’t have your seat-belt on, please fasten it.

 

Also, in case you were wondering, the Chinese are doing this because the economic data there continues to be a disappointment.

 

Subscribe to Hedgeye.


RTA Live: June 30, 2015

 

 

Get involved! There are two ways you can ask Keith questions:

  • Tweet us your questions via @Hedgeye with the #RTALive hashtag 
  • Ask questions in the chat box below the video player

If you are unable to watch this live, the replay will be available at the same link immediately following the completion of the show.


GET THE HEDGEYE MARKET BRIEF FREE

Enter your email address to receive our newsletter of 5 trending market topics. VIEW SAMPLE

By joining our email marketing list you agree to receive marketing emails from Hedgeye. You may unsubscribe at any time by clicking the unsubscribe link in one of the emails.

Retail Callouts (6/30): Solid Chain Store Sales Number, BONT Sale Leaseback

Takeaway: Chain Store Sales Put Up a Big Number, Need to See More as Comps Remain Difficult | BONT sale leaseback = defense, not offense.

Chain Store Sales Put Up a Big Number, Need to See More as Comps Remain Difficult

Takeaway: After a noticeable sequential slowdown in the 1-yr trend line last week, we saw a meaningful acceleration against tough comps from 2014 translating to the best 2yr comp reading we've seen reported in 2015. We'll need to see more of the same as comps remain difficult across retail until we get through September and BTS.

Retail Callouts (6/30): Solid Chain Store Sales Number, BONT Sale Leaseback - 6 30 chart1

Retail Callouts (6/30): Solid Chain Store Sales Number, BONT Sale Leaseback - 6 30 chart2

 

BONT - The Bon-Ton Stores, Inc. Announces Sale-Leaseback Agreement

(http://investors.bonton.com/releasedetail.cfm?ReleaseID=919749)

 

Takeaway: This isn't an offensive move by BONT, and the market said as much yesterday. The deal covers 20% of BONT's 30 owned properties and the deal terms aren't overly attractive. Plus, we think it's hard to justify paying ~$15 per square foot for department store pads in markets like Milwaukee, Green Bay, and Joliet. These stores are some of the company's most attractive doors with sales per square foot 170% to 350% above the fleet average. So, why didn't BONT monetize more doors -- if these are the terms WP Carey was willing to pay, it's entirely possible that the company didn't want more of what BONT was offering.

 

 

OTHER NEWS

 

KSS - Kohl’s Corporation Announces $600,000,000 Cash Tender Offer for Certain Notes

(http://phx.corporate-ir.net/phoenix.zhtml?c=60706&p=irol-newsArticle&ID=2063299)

 

TUES - Tuesday Morning Corporation Announces CFO Departure

(http://ir.tuesdaymorning.com/releasedetail.cfm?ReleaseID=920036)

 

PIR - Pier 1 Imports Appoints Retail Industry Veteran Jeffrey N. Boyer Executive Vice President and Chief Financial Officer

(http://phx.corporate-ir.net/phoenix.zhtml?c=117517&p=irol-newsArticle&ID=2063599)

 

TGT, RAD - Ex-Target exec to lead store ops for Rite Aid

(http://www.retailingtoday.com/article/ex-target-exec-lead-store-ops-rite-aid)

 

Authentic Brands Group Acquires Tretorn

(http://wwd.com/business-news/mergers-acquisitions/authentic-brands-group-tretorn-acquisition-10173169/)

 

Kering - Potential Suitors Emerge for Sergio Rossi

(http://wwd.com/business-news/financial/sergio-rossi-buyer-kering-lion-capital-emerisque-10172901/)

 

Barneys to Open Men’s Store in San Francisco

(http://wwd.com/retail-news/designer-luxury/barneys-mens-store-san-francisco-10172194/)

 


Gong Show

Client Talking Points

CHINA

Sneaky central planning dudes stole the Greek headlines overnight, throwing some rumor action (National Pension Fund buying!) out there, delivering the biggest intraday move in the Shanghai Composite since 1992! (closing up +5.5%); ex-Thailand (down -0.9%) Asian Equities were pretty much green across the board. 

EUROPE

Yes/No, risk On/Off – this is a certified political gong show at this point, but in the midst of it the Europeans still have to report slowing economic data. German Retail Sales went negative -0.4% year-over-year (Greek Retail Sales -1.9% year-over-year), Italian unemployment still sucks at 12.4%, and most PPIs were still year-over-year deflationary.

S&P 500

That wasn’t a typo – that was the 1st > 2% down day of 2015 (SPX has only had 5 of those in the last 2 years!), but there were 20 greater than 2% down days in the 6 months (JUN-DEC) of the last “European Crisis” (which incidentally was the last big 2H U.S. economic data slowdown “surprise”; VIX in the high-teens very different than VIX 11-12).

 

**The Macro Show - CLICK HERE to watch today's edition at 8:30AM ET with housing commentary from Housing & Macro Analyst Christian Drake.

Asset Allocation

CASH 49% US EQUITIES 5%
INTL EQUITIES 10% COMMODITIES 8%
FIXED INCOME 28% INTL CURRENCIES 0%

Top Long Ideas

Company Ticker Sector Duration
ZOES

We came out of the most recent earnings report being very positive about management doing all the little things right. They continue to prove that they are some of the best operators in the industry. In a quarter where ZOES opened 12 new company-owned restaurants they managed to decrease both COGS and labor. We view ZOES as one of the best small cap growth names.  The company is set-up for long-term success for the following reasons:

  1. Superior brand positioning
  2. Management philosophy and execution
  3. Unit opening geographic profile
  4. Early-stage average unit volumes and returns
PENN

PENN’s new property, Plainridge Park in Massachusetts, had a strong opening. We expect slot win per day of $400, above Street expectations. In addition, June state gaming revenues will begin to roll out in 1-2 weeks. We expect June to be as strong as May, setting up Q2 to be estimate-beating quarter for PENN.

TLT

After a Fed-fueled week of strength in slow-growth, yield-chasing asset classes and long duration fixed income, both the Dollar and interest rates re-couped their losses from Fed Week. The dollar declined, rates increased, and as a result, those long of gold took some pain. Will this continue? Will a long, sustained rate liftoff ensue? We don’t think so. We continue to repeat that the chance of further downward revisions to forward looking growth estimates from the Federal Reserve and consensus macro is much more likely than not. The attempted suspension of economic gravity from policy makers weakens the currency and puts pressure on bond yields. We remain long of this set-up with gold and long-duration fixed income.

Three for the Road

TWEET OF THE DAY

PODCAST (5mins) Lacalle: This Time Is Different In Greece https://app.hedgeye.com/insights/44956-lacalle-this-time-is-different-in-greece … via @hedgeye @dlacalle

@KeithMcCullough

QUOTE OF THE DAY

The horse is here today, but the automobile is only a novelty - a fad.

President of Michigan Savings Bank advising against investing in the Ford Motor Company

STAT OF THE DAY

53% of New York City’s 27,469 Airbnb listings are rented out for more than 60 nights per year, and 30% of them are managed by hosts who have more than one Airbnb listing to their name.


CHART OF THE DAY: Strap Your Seatbelts On | $VIX

Editor's Note: This is a brief excerpt and chart from today's morning strategy note written by Hedgeye CEO Keith McCullough. Click here to learn more about how you can subscribe.  

 

CHART OF THE DAY: Strap Your Seatbelts On | $VIX - zz 06.30.15 chart

 

...If you thought US stock market volatility and/or 2% down days were going away, you probably weren’t setup for an alpha generating day yesterday. To put that -2.1% drop in the SP500 in context:

 

    1. It was the 1st > 2% down day since October 9th, 2014
    2. There have only been 5 down days of > 2% in the last 2 years
    3. There were 20 > 2% down days in the JUN-DEC period of 2011

 

 


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 80.28%
  • SHORT SIGNALS 78.51%
next