The Rundown - Target Shares Plummet on Earnings Miss, Comcast to Spin Off Cable Channels

Episode Date: November 20, 2024

Stock market update for November 20, 2024.

Public.com presents the rundown. Your daily market update in five minutes. My name is Zadadmani, and today is Wednesday, November 20th. In today's episode, we'll dive into Target's earnings. Numbers weren't so pretty. We'll tell you more about it. We'll also discuss Comcast's plans to spin off their cable channels and why they're doing it. Then stick around to the end of the show to find out the latest perks of flying first class on Delta.

This might be the best reason to fly first class. All right, let's go. Well, stocks got off to a bumpy start yesterday when there was news of nuclear escalation coming out of Russia, but markets were able to recover and finish the day higher on Tuesday. The NASDAQ was up 1% and the S&P 500 was up 0.4%. This is despite more than 300 stocks in the S&P 500 finishing lower for the day. The index was able to squeeze out a gain thanks to a rally in tech stocks, especially in Vida, which jumped nearly 5% on Tuesday.

Remember, Nvidia reports earnings today after the bell, and there seems to be some optimism going into those earnings. Everyone's attention is going to be towards Nvidia's earnings today to get a feel for how the AI economy is doing. Any signs of a slowdown in their earnings could be concerning. I'm going to be glued to my computer this afternoon to dive into these earnings as soon as they come out, and I'll recap them on tomorrow's show. So make sure you guys tune in for that. Hopefully I got some good news to report. The only thing getting more attention these days than Nvidia is Bitcoin. It hit new all-time highs again yesterday, jumping past $94,000 for the first time ever.

I mean, the way things are going for Bitcoin, it's hard not to think that this is going to hit $100,000 soon. I don't want to jigs it, but my mind keeps thinking $100K. I'm not going to lie. Also, Thanksgiving is next week, and you already know there's going to be that one family member who's going to be talking nonstop about Bitcoin and crypto and telling all the people at the table to get in before it's too late. So I wonder if that's going to influence the price at all. Let's run through some headlines. And we should start with Target because they are having a tough morning.

The company just reported earnings and the numbers were pretty disappointing and their stock is getting crushed. Sales growth was flat in the third quarter. Same store sales were up just 0.3% compared to last year. That's pretty disappointing given the fact that analysts were expecting a 1.5% growth. You know, Target has been cutting prices to get shoppers to come back into their stores and that seems to be working. saw an increase in store traffic and online traffic, but shoppers are spending less money when they're at the stores. Target points that are shoppers pulling back on non-essential items, so they're buying less clothes, they're buying less candles, rugs, random home goods and knick-knacks,

you know, the things that Target is kind of known for. Now, what's interesting about that comment is that Walmart said the exact opposite when they reported earnings yesterday. Walmart saw an increase in discretionary spending. So this pullback at Target might just be a target problem. On top of the flat sales, the company also saw their profits drop 12% last quarter as well. Probably has to do with those price cuts. So pretty brutal third quarter for Target. Now, there were a couple bright spots for Target. Like their digital sales continues to grow. And Target also saw a 10% gain in curbside pickup. I've spent a lot of time waiting at curbside pickups for my wife's target orders. So this definitely checks out. But overall,

not a great quarter for Target. They seem to be getting crushed by their competitors like Walmart. and investors are definitely concerned. Their stock is down around 20% this morning in reaction to these earnings. Now, let's shift gears and talk about another industry that's been dominated by their competition, cable. Cable companies continue to decline as more and more people cut the cord and move over to streaming. And that's why Comcast announced plans today to spin off their cable channels into a separate company.

Remember, Comcast is the parent company of NBC Universal and they own a ton of cable channels. The company announced today they plan to spin off CNBC, MSNBC, USA, E, the Gulf Channel, and more cable channels into a new, separate publicly traded company. Like I said, cable continues to decline, but these networks are still profitable. At least some of them are. And Comcast is hoping that by spitting them off into a separate company, that they can acquire other cable networks into this venture. This is according to reporting from the Wall Street Journal. That would also allow Comcast to focus on their streaming platform, Peacock, which is going to stay under the Comcast umbrella. Comcast is also hanging on to the NBC channel and Bravo.

Why are they hanging on to Bravo? The new company is going to be led by internal NBC executives, and it's going to take about a year for this move to be finalized. There still has to be shareholder approval and regulatory approval, yada, yada, but it's all likely to go through. You know, this move by Comcast was rumored for a while now, and Comcast is finally doing it. So we'll have to see if this strategy pays off.

I'm not going to lie. Sometimes I kind of miss cable, or at least the way things used to be, I just don't like having like eight different streaming apps to go through. It's frustrating sometimes. Let's talk about some stocks making moves today. Shares of William Sonoma are soaring this morning on an earnings beat and strong guidance from the retailer. I guess there are still people out there buying $3,000 juicers from William Sonoma.

I'm a little surprised by that. I'm not going to lie. You know, I've actually never been to William Sonoma before. I've been gifted items from there, but I've never actually personally step. inside of a Williams Sonoma store before. But they must be doing something right because their shares are up around 26% this morning in reaction to these earnings.

Now, on the flip side, store that I've been to a lot is T.J. Max. And shares of their parent company are down this morning, despite the company beating third quarter earnings. Revenues were up 6%. earnings were up to $1.14 a share, both beating analyst's expectations,

but shares are still down 2% this morning, likely because the company's disappointing guidance for Q4. The parent company TJX owns T.J. Max and Marshalls. And you know, I had a big T.J. Max phase like 10 years ago. After graduating from college, I needed to buy some business casual clothes. And I just loaded up at T.J. Max. I'm talking dress shirts, dress pants, got it all from T.J. Max. And I eventually moved on to Coles. And now I don't think I've got a dress shirt since like 2020. Let's wrap the show with a fun fact. You'll soon be able to order a Shake Shack Burger on a Delta Airlines flight. Delta Airlines will allow passengers in first class to order shake shack burgers right from their seat.

And yes, it's going to come with the shake sauce. The burgers will come with the chips, a salad, and a brownie. But unfortunately, no crinkle cut fries. This is all happening starting December 1st for first class passengers for long distance flights going out of Boston. And Delta is going to be offering these burgers on more flights starting next year. At first, I was like, this is a great idea. But like, do you really want to eat a burger while flying? I personally like to keep my meals pretty light when I'm flying, but that's just me.

Well, all right, guys, that's the rundown for today. Hope you guys enjoyed today's episode. We have a big episode coming up tomorrow. We are recapping earnings from Nvidia. I mean, there's no bigger news than that, right? The fate of the stock market, the fate of our portfolios rest on Nvidia's earnings. That's what it feels like every time. We're going to be diving into those earnings and the market's reaction to those earnings on tomorrow's show.

So make sure you guys tune in for that. And if you guys enjoy the show and if you have like 12 seconds, consider giving us a five-star rating on Apple and Spotify. Leave a comment on Spotify, vote in today's Spotify poll. All that engagement really helps us out, and it helps other people find the show. Thank you guys so much for listening. Shout out to Mike and Connor for all the help behind the scenes,

and we'll see you guys back here tomorrow. This is the rundown. Your real-time resource for news events and trends in the markets. All views presented in the show reflect the opinions of the guests. You should not take any mention of a publicly traded security as recommendation to buy, sell, or hold that security. Run-down guests are not financial advisors and are not affiliated with public holdings or its subsidiaries.

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