Economic reports in the week ahead
Look for the CPI inflation report for August to be one of the big talking points in the week ahead. The report is expected to show that prices rose 8.1% in August to a mark second straight month of deceleration, although core CPI is projected to be slightly higher on a month-to-month comparison. The report will drop with Federal Reserve Board members in a blackout period next week ahead of the next FOMC meeting set for September 20-21. Analysts have warned that moderating inflation is unlikely to budge the FOMC from hiking interest rates another 75 points at the meeting due to its hawkish stance. In his last public appearance before the FOMC meeting, Fed President Jerome Powell said the central bank’s policy interventions are aimed in part to cause the labor market to get back into better balance and bring wages back down to levels that are more consistent with 2% inflation. Big corporate events next week include highly anticipated investor days for Starbucks (NASDAQ:SBUX) and Roblox (NYSE:RBLX).
Earnings spotlight: Monday, September 12 – Oracle (NYSE:ORCL) and Planet Labs (NYSE:PL).
Earnings spotlight: Tuesday, September 13 – Core & Main (NYSE:CNM) and Vintage Wine Estates (NASDAQ:VWE).
Earnings spotlight: Wednesday, September 14 – BRP (NASDAQ:DOOO) and Li-Cycle (NYSE:LICY),
Earnings spotlight: Thursday, September 15 – Adobe (NASDAQ:ADBE).
Earnings spotlight: Friday, September 16 – Manchester United (NYSE:MANU).
IPO watch: The IPO calendar heats up just a little bit with several new companies going public. Chinese financial services firm Lichen China (NASDAQ:LICN) is expected to start trading on September 12. Meanwhile, Corebridge Financial (CRBG) is expected to start trading on September 14 after spinning off from AIG (AIG). The IPO offering will see 80M shares released at an expected pricing range of $21 to $24 per share. CRBG is already a profitable and expects to provide a 4% dividend yield at the IPO price. Biotech firm Jupiter Neurosciences (NASDAQ:JUNS) is also scheduled to start trading on September 14. Also watch for IPO lockup expiration for blocks of shares on EzFill Holdings (NASDAQ:EZFL) and Pasithea Therapeutics (NASDAQ:KTTA).
Starbucks Investor Day preview: Starbucks (SBUX) will hold a highly-anticipated Investor Day event on September 13. The company is expected to provide comprehensive details on its new reinvention plan, update on strategies, and introduce new CEO Laxman Narasimhan to the analyst community. Investors will also be closely watching what SBUX does with its 2023 earnings guidance and the roadmap for the long-term financial model. SBUX has previously outlined a normalized long-term 10% to 12% EPS algorithm, which could be at risk of being revised. Ahead of the Starbucks event, Barclays said it is very bullish on the stock. “We view Starbucks as a premiere, large-cap, high- growth, global consumer company led by a dominant US retail & consumer product platform, significant int’l growth led by China & a best-in-class digital platform,” previewed the firm. Bernstein also took a positive stance, saying it believes the company can turn around next year with a new CEO marking a return to long-term sustainable growth. “In our view, the China headwinds of ’22 will turn into tailwinds in ’23… Labor investments being made in the US will be lapped as we move through the year, easing the unionization headwinds, while leading to stronger fundamental performance. Lastly, we expect global inflation to moderate (i.e. coffee and labor), while incremental menu pricing mitigates.” For its part, Morgan Stanley reminded that SBUX analyst meetings tend to be positive stock catalysts as they reinstill in investors’ minds the many positive attributes of the business, the size of its competitive moat and its future growth prospects. The firm assumes depressed margins for SBUX in FY22, but thinks there could be multiple years where revenue growth (including pricing) should modestly exceed expense growth to support strong EPS growth. Bank of America is a bit more cautious on how Starbucks will navigate through labor investments and if those will be split between recurring or non-recurring expenses in the years ahead.
Detroit Auto Show preview: The NAIAS Detroit Auto Show kicks off on September 14, ending a three-year hiatus sparked by the COVID-19 pandemic. Among a lighter list of attendees – Ford Motor Company (NYSE:F), General Motors (NYSE:GM), and Stellantis (NYSE:STLA) are set to headline alongside Korean automaker Hyundai (OTCPK:HYMLF) as well as a number of EV and auto technology startups. The most hotly anticipated reveal of the event is the presentation of the new S650 Mustang. Ford (F) has teased the new 2024 model for some time, though details on it remain scant. Automotive News reported days ahead of the event that a hybrid model will not be on deck for the event, despite longstanding plans to roll out a more eco-friendly model. The new Mustang is expected to feature new Google infotainment software. Ford is also expected to show off a new Lincoln L100 concept car during the event. Both General Motors (GM) and Stellantis (STLA) brands will be well-represented during the event, with a strong possibility for new announcements from each. Stellantis-owned Chrysler has teased about an unveil of a special-edition Chrysler vehicle, while Stellantis (STLA) said cryptically on Facebook ahead of the event to “Stay tuned.” Aside from the major automakers, new startups like Harbinger are on the docket for September 14. The Los Angeles-based Harbinger, which focuses on medium-duty vehicles, said that its initial product line will include “electric stripped chassis and cab chassis designed specifically to address the unique performance, durability, and lifespan expectations required in Class 4 to Class 7 vehicles” as well as “eAxle” and battery technologies “built to exceed industry standards. Read more details on the company’s planned announcements. Multiple EV technology firms are also set to present at the Detroit Auto Show. German auto technology firm Autel is set to reveal a slate of new advancements in EV charging, cloud capabilities, and more. Plug Zen is also on the schedule. The company is a developer of EV charging products that allow for up to 10 vehicles to charge simultaneously. Canadian auto parts manufacturer Magna International (NYSE:MGA) is expected to unveil its “EtelligentForce” battery-electric vehicle powertrain system for electrifying pickup trucks and light commercial vehicles. Finally, a number of companies not quite fitting into the auto category are slated to be in attendance. In what the event termed a “Show Above the Show,” six international air mobility innovators across electric vertical take-off and landing (eVTOL) aircraft, amphibious sport planes, hoverbikes, hoverboards, and jet suits are expected to be parts of the show. Of note, XTURISMO and ASX are also due to provide updates during the week’s busy schedule. The latter is anticipated to unveil its SIGMA – SIX (S6) Electric Vertical Takeoff and Landing Aircraft during the event. The former will showcase its flying bikes.
Corporate events: Brookfield Asset Management (NYSE:BAM) will hold an investor day event on September 12. Shares of BAM rallied more than 3% after last year’s investor day event. On September 13, Twitter (NYSE:TWTR) will hold a special shareholder meeting to vote on Elon Musk’s offer to buy the company for $54.20 per share. A flurry of investor events are scheduled for September 14-15 with Cimpress plc (NASDAQ:CMPR), Workday (NASDAQ:WDAY), Roblox (RBLX), Humana (NYSE:HUM), Danaher (NYSE:DHR), Harmonic’s (NASDAQ:HLIT) and National Instruments (NASDAQ:NATI) some of the more notable ones. The week ends with AdaptHealth Corp (NASDAQ:AHCO) holding a Capital Markets Day event on September 16.
Notable conferences: A busy conference schedule next week is headlined by the Goldman Sachs Communcacopia Technology Conference that has been the backdrop of tech and media developments in the past. Some of the notable presenters this year are eBay (NASDAQ:EBAY), General Motors (GM), Peloton Interactive (NASDAQ:PTON), Coinbase Global (NASDAQ:COIN), Applied Materials (NASDAQ:AMAT), Etsy (NASDAQ:ETSY), IMAX (NYSE:IMAX), Pinterest (NYSE:PINS), and AT&T (NYSE:T). Other notable conferences include the CL King’s 20th Annual Best Ideas Conference, the Barclays Global Financial Services Conference, the Goldman Sachs Communacopia + Technology Conference, the Morgan Stanley 20th Annual Global Healthcare Conference, the Raymond James Consumer Conference, and the KBC Securities Virtual Life Sciences Conference.
Barron’s mentions: Volkswagen’s (OTCPK:VWAGY) plan to pursue an IPO of the preferred shares of Porsche (OTCPK:POAHY) and list them in Frankfurt is seen going a long way in addressing its low valuation in the runup to the offering in late September or early October. The offering is seen being a positive catalyst for Volkswagen’s stock with Porsche estimated to be valued at $60B to $85B and likely to attract investor attention. Porsche is noted to be the most valuable part of Volkswagen’s automotive portfolio, which includes its mass-market VW brand, premium Audi unit, and ultra high-end Bentley and Lamborghini lines. Beyond the IPO buzz, Volkswagen is seen as an attractive stock play in the auto sector based on its profits and a sum-of-the-parts analysis, and is called the best-equipped incumbent to take on Tesla (TSLA).
Sources: EDGAR, Bloomberg, CNBC, Reuters
Editor’s Note: This article covers one or more microcap stocks. Please be aware of the risks associated with these stocks.
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