WEBVTT - Week Ahead: Nike, Beyond Meat, RH 

0:00:02.520 --> 0:00:08.680
<v Speaker 1>Bloomberg Audio Studios, podcasts, radio News, The.

0:00:08.720 --> 0:00:12.560
<v Speaker 2>Stock Movers Report, your roundup of companies making moves in

0:00:12.600 --> 0:00:15.880
<v Speaker 2>the stock market, harnessing the power of Bloomberg Data.

0:00:16.640 --> 0:00:18.840
<v Speaker 1>Let's take a look now at some stocks making news

0:00:18.840 --> 0:00:21.440
<v Speaker 1>in the week ahead. I'm Nathan Hager, joined by Bloomberg

0:00:21.480 --> 0:00:25.680
<v Speaker 1>Equities reporter Alexandra Semenova, getting us ready for some stocks

0:00:25.680 --> 0:00:29.040
<v Speaker 1>that are going to make news on earnings, starting this Tuesday.

0:00:29.080 --> 0:00:30.160
<v Speaker 2>With Nike.

0:00:30.600 --> 0:00:33.720
<v Speaker 1>You know, alex that the struggle for this company has

0:00:33.880 --> 0:00:34.760
<v Speaker 1>been real.

0:00:35.440 --> 0:00:36.000
<v Speaker 2>Yeah, Nathan.

0:00:36.240 --> 0:00:38.840
<v Speaker 3>It is going to be an important company for investors

0:00:38.840 --> 0:00:42.800
<v Speaker 3>to watch, giving its role as a retail and consumer bellweather.

0:00:43.240 --> 0:00:46.519
<v Speaker 3>Its results will test whether its long promise turnaround is

0:00:46.520 --> 0:00:50.440
<v Speaker 3>gaining traction or not. So all in all, Nike anticipates

0:00:50.479 --> 0:00:54.080
<v Speaker 3>low single digit revenue declines in a gross margin contraction

0:00:54.240 --> 0:00:57.320
<v Speaker 3>year over year for the fiscal third quarter, and analysts

0:00:57.360 --> 0:01:01.840
<v Speaker 3>are also anticipating soft global sales inventum through March. China,

0:01:01.960 --> 0:01:05.600
<v Speaker 3>of course, remains the swing factor for this company. Its

0:01:05.640 --> 0:01:08.720
<v Speaker 3>turnaround still runs through China, where sales have been deeply

0:01:08.800 --> 0:01:13.200
<v Speaker 3>negative and remain a major drag on both revenue and earnings.

0:01:13.480 --> 0:01:16.880
<v Speaker 3>So any sign of stabilization for that sector, even something

0:01:16.920 --> 0:01:21.400
<v Speaker 3>that is just less bad could shifts sentiment quickly. Sales

0:01:21.400 --> 0:01:24.480
<v Speaker 3>in China are estimated to be down sixteen percent, with

0:01:24.600 --> 0:01:28.200
<v Speaker 3>operating margin down five hundred basis points, and in North

0:01:28.200 --> 0:01:32.120
<v Speaker 3>America there are early signs of improvement helping offset some

0:01:32.200 --> 0:01:35.680
<v Speaker 3>of the weakness in direct to consumer and international markets.

0:01:35.920 --> 0:01:38.839
<v Speaker 3>When it comes to the stock reaction that people anticipate

0:01:38.880 --> 0:01:42.520
<v Speaker 3>on the earnings, options markets are implying a seven point

0:01:42.640 --> 0:01:45.280
<v Speaker 3>six percent share move post earning, so going to be

0:01:45.560 --> 0:01:48.520
<v Speaker 3>interesting to see the market reaction to its results. And

0:01:48.600 --> 0:01:51.520
<v Speaker 3>looking at some of the Wall Street analyst reactions ahead

0:01:51.520 --> 0:01:55.120
<v Speaker 3>of the reports, UBS lowered its price target on the company.

0:01:55.240 --> 0:01:56.840
<v Speaker 3>Deutsche Bank did as well.

0:01:56.920 --> 0:01:59.960
<v Speaker 1>Okay, so it sounds like the bar is pretty low

0:02:00.240 --> 0:02:02.720
<v Speaker 1>when it comes to Nike, right, I mean, if they

0:02:03.000 --> 0:02:06.280
<v Speaker 1>can come out and you know, beat earnings, does that

0:02:07.160 --> 0:02:10.800
<v Speaker 1>imply that we could see a pretty significant boom for Nike.

0:02:11.040 --> 0:02:15.000
<v Speaker 3>It certainly does, you know, indicate that if they do

0:02:15.120 --> 0:02:18.280
<v Speaker 3>surprise to the upside, if they say anything positive, then

0:02:18.320 --> 0:02:21.040
<v Speaker 3>we could see a pretty strong reaction from the results.

0:02:21.080 --> 0:02:24.720
<v Speaker 3>Hence that nearly eight percent move that investors are pricing in.

0:02:25.000 --> 0:02:28.560
<v Speaker 1>Also on Tuesday, we hear from beyond Meat or are

0:02:28.560 --> 0:02:31.280
<v Speaker 1>they calling themselves beyond now? Did they drop the meat

0:02:31.320 --> 0:02:33.720
<v Speaker 1>from that? I can't remember, Yeah, I can't remember.

0:02:33.800 --> 0:02:35.919
<v Speaker 3>It's hard to keep up. So they have a new

0:02:35.960 --> 0:02:40.360
<v Speaker 3>overhand that we are monitoring, which is accounting and control issues.

0:02:40.639 --> 0:02:44.760
<v Speaker 3>So they delayed their earnings results after identifying accounting errors

0:02:45.000 --> 0:02:49.400
<v Speaker 3>and material weakness tied to inventory. That's raised questions about

0:02:49.400 --> 0:02:53.000
<v Speaker 3>its internal controls and for investors now the focus isn't

0:02:53.080 --> 0:02:55.960
<v Speaker 3>just on the fundamentals from the earnings report, but about

0:02:56.240 --> 0:02:59.320
<v Speaker 3>governance and execution risk as well, depending on what they

0:02:59.400 --> 0:03:01.960
<v Speaker 3>say about those issues. So the company had found errors

0:03:02.120 --> 0:03:05.880
<v Speaker 3>and it's previously issued financial statements for the first three

0:03:05.960 --> 0:03:09.480
<v Speaker 3>quarters of twenty twenty five. Management had tried to assure

0:03:09.520 --> 0:03:13.880
<v Speaker 3>investors that these aren't material errors and they're going to

0:03:13.880 --> 0:03:16.840
<v Speaker 3>get them fixed pretty quickly. But investors will be keen

0:03:17.080 --> 0:03:19.400
<v Speaker 3>to hear what they say during the earnings call about

0:03:19.400 --> 0:03:23.280
<v Speaker 3>those accounting mishaps. And then on the fundamental side, Beyond

0:03:23.280 --> 0:03:27.600
<v Speaker 3>Me is facing shrinking sales and ongoing losses. The company

0:03:27.639 --> 0:03:31.400
<v Speaker 3>expects preliminary net revenues of about sixty one million for

0:03:31.440 --> 0:03:34.320
<v Speaker 3>the fourth quarter of twenty twenty five. That aligns with

0:03:34.400 --> 0:03:38.320
<v Speaker 3>prior guidance of between sixty million and sixty five million dollars,

0:03:38.560 --> 0:03:41.080
<v Speaker 3>and the company is still expecting to post a loss,

0:03:41.400 --> 0:03:45.960
<v Speaker 3>highlighting how far it remains from any sustained profitability. This comes,

0:03:45.960 --> 0:03:49.040
<v Speaker 3>of course, as consumers just pull back from their product

0:03:49.480 --> 0:03:53.880
<v Speaker 3>due to higher prices, competition from cheaper animal protein, and

0:03:54.000 --> 0:03:56.600
<v Speaker 3>a broader shift toward less processed food.

0:03:56.840 --> 0:03:58.720
<v Speaker 1>Yeah, I mean it's it's got to be tough, just

0:03:58.840 --> 0:04:02.960
<v Speaker 1>from the fact that traditional meats have gotten more expensive

0:04:02.960 --> 0:04:06.040
<v Speaker 1>these days as well, So definitely keeping an eye on

0:04:06.080 --> 0:04:09.160
<v Speaker 1>that stock as well. And then on Thursday we get

0:04:09.200 --> 0:04:12.000
<v Speaker 1>results from ourh I think a lot of us might

0:04:12.000 --> 0:04:14.960
<v Speaker 1>remember this one better is restoration Hardware, but this could

0:04:15.000 --> 0:04:17.919
<v Speaker 1>be really interesting to hear from a furniture maker in

0:04:17.920 --> 0:04:18.640
<v Speaker 1>this environment.

0:04:18.960 --> 0:04:22.080
<v Speaker 3>It certainly will be because this company was kind of

0:04:22.120 --> 0:04:25.240
<v Speaker 3>at the center of some of the tariff volatility last year.

0:04:25.600 --> 0:04:29.000
<v Speaker 3>So our Age is expected to experience sales gains extending

0:04:29.040 --> 0:04:32.120
<v Speaker 3>into twenty twenty six, a positive they are given its

0:04:32.200 --> 0:04:36.000
<v Speaker 3>unique position with high end consumers and a small share

0:04:36.040 --> 0:04:39.599
<v Speaker 3>of the home furnishings market, and sales growth is projected

0:04:39.720 --> 0:04:42.960
<v Speaker 3>to slow a bit to a six quarter low in

0:04:43.000 --> 0:04:46.200
<v Speaker 3>the fiscal fourth quarter falling a slight softening in twenty

0:04:46.240 --> 0:04:49.960
<v Speaker 3>twenty five. Our Age is moving forward with its hospitality

0:04:50.040 --> 0:04:53.960
<v Speaker 3>and international expansion strategies, so investors will be keen to

0:04:54.000 --> 0:04:57.680
<v Speaker 3>hear what updates they have on that. Those of course,

0:04:57.720 --> 0:05:01.400
<v Speaker 3>could lead to stronger market share, but they also involve

0:05:01.560 --> 0:05:05.760
<v Speaker 3>execution risk and concerns still remain about the impact from

0:05:05.960 --> 0:05:09.839
<v Speaker 3>tariffs and any ongoing investment spending. You might remember that

0:05:10.279 --> 0:05:14.480
<v Speaker 3>the company had trimmed its fullier outlook before citing pressures

0:05:14.520 --> 0:05:18.400
<v Speaker 3>from tariffs, and famously, last April, its CEO drew attention

0:05:18.600 --> 0:05:22.760
<v Speaker 3>during the company's earnings call after blurting out a curse

0:05:22.839 --> 0:05:26.440
<v Speaker 3>word watching their stock decline as tariffs were implemented. So

0:05:26.920 --> 0:05:29.080
<v Speaker 3>that's an interesting one to remember, and it's going to

0:05:29.080 --> 0:05:32.120
<v Speaker 3>be really important to hear what they say about tariffs.

0:05:32.360 --> 0:05:36.520
<v Speaker 1>Yeah, a lot of potential headwinds still for all of

0:05:36.560 --> 0:05:40.760
<v Speaker 1>these companies. It sounds like the bar is pretty high

0:05:40.960 --> 0:05:41.600
<v Speaker 1>all around.

0:05:42.120 --> 0:05:44.599
<v Speaker 3>Yeah, I mean, the earnings reports will be a make

0:05:44.760 --> 0:05:48.839
<v Speaker 3>or break moment for equity investors given all the updates

0:05:48.880 --> 0:05:51.560
<v Speaker 3>we're expected to get on the impact of oil prices

0:05:51.560 --> 0:05:55.360
<v Speaker 3>on their businesses and on the continued unwind of tariffs.

0:05:57.080 --> 0:06:01.080
<v Speaker 2>This stock mover's report from Bloomberg Radio. Check back with

0:06:01.160 --> 0:06:03.760
<v Speaker 2>us throughout the day for the latest roundup of companies

0:06:03.800 --> 0:06:06.920
<v Speaker 2>making news on Wall Street and for the latest market

0:06:06.960 --> 0:06:11.440
<v Speaker 2>moving headlines. Listen to Bloomberg Radio Live, catch us on YouTube,

0:06:11.520 --> 0:06:15.000
<v Speaker 2>Bloomberg dot com, and on Applecarplay and Android Auto with

0:06:15.080 --> 0:06:16.559
<v Speaker 2>the Bloomberg Business app.