Adding 3 New Shorts to Investing Ideas

You're not going to make money on every market move you make... but you can save yourself a lot of money by not making sales at the low-end of the SP500's @Hedgeye Risk Range (Friday), then covering those shorts post a big 4-day bounce! 

Don't do that.

Stay with the #process and execute on it. After waiting and watching, my signals are saying today is a much better day to re-engage on the short-side. One of our BEST (longer-term) SELL ideas from Brian McGough (Institutional Research product) remains Hanesbrands (HBI). 

Here's an excerpt from Brian's recent recap of another dicey HBI quarter:

• Why in the world is management talking about a ‘challenging retail environment’ when we just saw the best comps out of its wholesale channel in 5-years? It’s called share loss. And it’s accelerating.
• Missed EBIT. $916mm for the year vs lowered $925-935mm . 4Q was supposed to be $241-251 and did $231.
• Operating profit guided to $950-$985mm vs street at $983mm, and acquisitions are expected to add $30mm in EBIT

Sell green,

KM

The bulls call UAL a "cheap stock", but we think you can call anything cheap if your analyst is using the wrong numbers!

The Bear (Jay Van Sciver) says the stock is going lower.

I say it's signaling immediate-term TRADE #overbought within a Bearish @Hedgeye TREND.

Here's also what Jay said about the United's (UAL) recent analyst day:

"The UAL Investor event last night was exceptional in that it completely reversed course on many key prior initiatives.  We’ll review a few, but it puts analysts in the awkward position of having told investors and PMs that doing “X” (e.g. cutting high cost regional flying) is the way forward, only to find a year or two later that doing the opposite (e.g. more regional flying for connectivity) is the way forward.  Basically, UAL told investors they are going to try harder on things like asset utilization and employee productivity."

Lovely,

KM 

After markets bounce, Mr. Market gives you an opportunity to reset both your positions and exposure.

What you do on the bounce is absolutely going to determine how you do during the next selloff. If you don't think there will be another selloff, then you shouldn't be setting up for one like I am!

A big 4-letter name that Howard Penney no longer likes is Starbucks (SBUX). It's a Best SELL Idea @Hedgeye. Here's how Penney described the recent SBUX quarter, which was not good:

"Consolidated SSS came in at +2.0% vs Consensus +3.0%, showing a continued slowdown in the overall business. On a two-year average basis, same-store sales have slowed by 300bps since 1Q17. In the Americas, SSS was +2.0% vs. Consensus +3.2%, showing a slowdown of 350bps since 1Q17. With the comps slowing by so much, management will be hard pressed to find a viable growth engine in the Americas going forward. Adding to their problems was the margin compression experienced during the quarter as a result of a slowdown in transactions during the holiday program launched in mid-November, which included holiday gifts cards and merchandise. According to the Company, “We saw a slowdown in transaction comps, bringing total comps for the back-half of the quarter to roughly 1% with transaction comps slightly negative.” With the effects of this holiday program still being felt into 2Q18, margins will continue to be pressured."

Sell the bounce,

KM