Marc Benioff, chief executive officer of Salesforce speaks during the World Economic Forum (WEF) in Davos, Switzerland on January 18, 2024.
Halil Sagirkaya | Anadolu | Getty Images
My top 10 things to watch Thursday, Aug. 29
1. Nvidia‘s quarter was a mixed bag, but numbers will be up next year … production of its anticipated Blackwell chip is delayed but not destroyed, and chipmaker Advanced Micro Devices is two years behind. We’ll discuss the quarter in our morning meeting at 10:20 a.m. ET. In the meantime, check out our analysis of Nvidia’s report.
2. Club name Best Buy lifted its full-year profit estimates — the retailer now expects adjusted EPS in range of $6.10 to $6.35, up from a prior range of $5.75 to $6.20 — after beating earnings and sales expectations for its latest quarter. Shares jumped more than 15% in the premarket. We’ll have a full breakdown of the results after the company’s conference call with investors and analysts this morning.
3. Club holding Salesforce‘s new platform “Agentforce,” which helps companies automate certain functions, sounds like the first AI game changer when it comes to improving gross margins. “We have deployed Agentforce now to so many of our customers, and we’re so excited because what we’re helping them to do is to deliver a level of automation with their customer service or with their sales that they’re never seen before,” CEO Marc Benioff told me on “Mad Money.” For example, the platform helps textbook maker Wiley during the busy back-to-school season by expanding its customer service capabilities without having to hire temporary employees.
4. Benioff’s remarks came after the enterprise software giant on Wednesday beat sales and earnings expectations for the second quarter. The results were cleaner this go around with key beats on revenue, remaining performance obligation (RPO) and the current RPO (cRPO), along with an improved adjusted operating margin guidance. RPO represents contracted revenue that has not yet officially been recorded, while cRPO is the amount expected to be recorded in the next 12 months. Investors pay close attention to the changes in these metrics to help them gauge the health and momentum of the business. Shares of Salesforce jumped more than 4% in extended trading Wednesday.
5. Crowdstrike acknowledged difficulties — some disconcerting language at end of its earnings forecast — but still doing well. The cybersecurity company beat fiscal second-quarter expectations on the top and bottom lines.
6. Abercrombie & Fitch added to JPMorgan’s “analyst focus list,” citing the pullback after the retailer’s beat-and-raise quarterly report Wednesday. I agree. The retailer fell about 17% after CEO Fran Horowitz warned of an “increasingly uncertain environment.” Analyst Matthew Boss maintained his overweight rating and $194 price target.
7. Citi says Club name Apple is now its top AI pick going into 2025, above Nvidia and Arista Networks. The analysts said the iPhone 16 product launch on Sept. 9 will highlight the AI phone features and experience. We wrote about 3 ways Apple can impress Wall Street at the upcoming event. The stakes are especially high this year, given the stock is up 38% since its lows of the year on April 19 largely on AI optimism.
8. Barclays upgraded Foot Locker to buy from hold. Good idea, beginning to see the turn at the sneaker and clothing retailer. The analysts said the positive impacts of a fundamental business recovery will result in earnings and margin upside over the next 12 to 18 months.
9. William Blair started coverage of Tesla with a buy, and it’s all about Tesla Energy, an underappreciated part of Tesla’s story that will become more of a focus as demand for electric vehicles moderates in the near term. The firm said the company’s Megapack and Powerwall are industry leading energy storage products.
10. J.M. Smucker price target lowered to $136 from $138 at Citi, citing “uneven messaging lately” from management. I agree. The stock fell about 5% after the food and beverage company on Wednesday lowered its full-year guidance. Management now sees earnings of $9.60 to $10 a share for the fiscal year ending April 2025 versus its previous estimate of $9.80 to $10.20 per share.
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