Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: The Stock Movers Report, your roundup of companies making moves
Speaker 2: in the stock market. Harnessing the power of Bloomberg Data.
Speaker 1: Let's take a look now at some stocks making news
Speaker 1: in the week ahead. I'm Nathan Hager, joined by Bloomberg
Speaker 1: Markets Live strategists Tatiana Daria. I guess we could say
Speaker 1: this is the unofficial start of earning season, before the
Speaker 1: banks get things going right. We've got a few companies
Speaker 1: opening things up, including Constellation Brands on Wednesday. It's been
Speaker 1: a tough go for the booze business, hasn't it.
Speaker 3: Yes, exactly. Expectations aren't very high here for the company,
Speaker 3: but some analysts on Wall Street are starting to warm
Speaker 3: up to the stock on valuation concerns, saying that a
Speaker 3: lot of the bad news is already in the stock
Speaker 3: so Bloomberg Intelligence forecast dot Net revenue will fall about
Speaker 3: fifteen percent do mainly to their wine in spirits portfolio devestments,
Speaker 3: but they're also anticipating some sluggishness in the beer segment,
Speaker 3: which is obviously their main driver or crown a jewel
Speaker 3: there and especially among Hispanic consumers. BI notes, but some
Speaker 3: analysts are saying that most of that is already in
Speaker 3: the price. Perhaps, you know, the beer segment has room
Speaker 3: to surprise to the upside. We've seen JP Morgan lifting
Speaker 3: their price target, We've seen Evercore adding the stock to
Speaker 3: the tactical outperform list, and it also got an upgrade
Speaker 3: from City earlier this month, citing a valuation that's below
Speaker 3: historical levels. And if you look at the forward price
Speaker 3: to earnings ratio, it has indeed fallen drastically. It's hovering
Speaker 3: around the lowest since twenty twelve now as shares have
Speaker 3: come down sharply over the past year.
Speaker 1: Yeah, valuation concern certainly speaks to that. There Before we
Speaker 1: hear from Constellation, and we're going to get results as
Speaker 1: well from Levi Strauss on Tuesday. Of course, we got
Speaker 1: that big disappointment from Nike this past week. Do you
Speaker 1: put Levi in the same category as Nike in terms
Speaker 1: of what to expect there?
Speaker 3: I think one has to, right because they both speak
Speaker 3: to the consumer. They're both sort of discretionary brands that
Speaker 3: you turn to for sort of luxury and comfort, not
Speaker 3: necessarily because you really need to, And expectations are pretty
Speaker 3: I would say modestly positive. UBS, for example, expects a
Speaker 3: fourth quarter sales and EPs beat, though they say the
Speaker 3: company may remain cautious on a full year outlook amid
Speaker 3: the macro as. Certainly, just like we've seen with Nike,
Speaker 3: they know that the US direct to consumer sales likely
Speaker 3: rose about two percent year over year, and that web
Speaker 3: traffic likely increased even more in the US according to
Speaker 3: their industry data that they track. Nonetheless, the company may
Speaker 3: choose to just be cautious and conservative and not raise
Speaker 3: their guidance despite the likely beat. And that's because of
Speaker 3: the reasons that we have seen with the Nike report,
Speaker 3: with potential fresh setbacks in Europe and the Middle East,
Speaker 3: regions that are obviously heavily exposed to the energy costs
Speaker 3: and just the disruptions coming from the year round war.
Speaker 1: Now, were you expecting any further commentary from Levi around
Speaker 1: how they're dealing with trade uncertainty as well after that
Speaker 1: Supreme Court tariff decision and some of the uncertainty around
Speaker 1: how the President might try to rebuild that terrafall and
Speaker 1: how that could affect its business.
Speaker 3: Yes, certainly, you know, tariffs is sort of fallen off
Speaker 3: the radar, but when you look at company earnings, especially
Speaker 3: in the consumer space, it is still a big focus.
Speaker 3: So it will be really interesting to see what the
Speaker 3: company has to say on that matter.
Speaker 1: Yeah, and of course earnings take off with Delta Airlines
Speaker 1: on Wednesday. What kind of a stock move could we
Speaker 1: see following those results? Ta Tiana.
Speaker 3: Well, it's interesting with Delta air is that they kind
Speaker 3: of have been the exception among the airlines. It is
Speaker 3: the only airline stock bucking the weakness among major peers
Speaker 3: since the war started. If you look at an index
Speaker 3: of an industry index, that index has fallen into a
Speaker 3: bear market recently, but Delta shares have actually gained three
Speaker 3: percent since the war started. And maybe because the company
Speaker 3: has already set a positive tone for its earnings report
Speaker 3: after issuing a more optimistic sales target at a recent conference,
Speaker 3: saying that bookings for leisure and corporate customers accelerated into March. Actually,
Speaker 3: and they say they are very well positioned to navigate
Speaker 3: the current environment at the time when elevated fuel prices
Speaker 3: are roiling the industry. And it looks like are giving
Speaker 3: Delta the benefit of the doubt here, But obviously things
Speaker 3: change very fast these days, so it will be interesting
Speaker 3: to see how their views have changed since they issued
Speaker 3: that update about two weeks for two weeks.
Speaker 1: Ago from now, yeah, absolutely, while we wait for updates
Speaker 1: around the war and how that could develop as well.
Speaker 1: I mean, what kind of changes could we see? What
Speaker 1: are you listening for, particularly from the call from Delta
Speaker 1: later on.
Speaker 3: I'll be listening on clues about the consumer right because
Speaker 3: obviously travel is a discretionary category. Most of us do
Speaker 3: it for fun, for vacations, so I'll be interested to
Speaker 3: see if they have seen a pullback from consumers specifically,
Speaker 3: because if you look at alternative data on the Bloomberg
Speaker 3: as it relates to that, yes, it showed that airline
Speaker 3: spending is hanging in there, but hotel spending has sort
Speaker 3: of fallen off here in recent weeks, So I'd be
Speaker 3: sort of curious to see how much is that impacting
Speaker 3: airlines already.
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