Recent $CHD Takeover Rumors Are of the Criminal Nature

Over the past two days, shares of the consumer goods giant have soared in pre market thanks to inane and completely unfounded takeover rumors. Yesterday, CHD surged by 30% in the pre market before people figured out it was bullshit.

This morning the stock surged by 11% on more rumors.

So the company issued this statement.

The co issued a statement saying that, “Over the last several days multiple rumors were reported in the press regarding a potential purchase of the Company. The Company believes that it is prudent to advise its employees and investors that the Company is not engaged in discussions with, nor has it received any proposal or communication concerning a potential bid for the Company or any of its business units and is not otherwise aware of any information supporting these rumors.”

With a market cap over $12 billion, whoever is behind these rumors is likely big. A big fucking criminal that is.

Two two things of note.

1. Dudley is the most important Fed members, because he’s from the NY Fed, the home of Wall Street.
2.  The new ‘above trend’ growth rate for the economy is 2%. This is a perversion of reality. The middle class is unable to thrive at such a paltry rate.

Fed’s Dudley says U.S. economic growth above trend; sees Q2 improving from Q1; was surprised by Q1 weakenss

The Fed and others in government aren’t stupid.  They are nefarious scoundrels. By calling them stupid, you give them a pass and exonerate them for their actions. If they were considered to be nefarious in their dealing with the economy, you’d start to see that their intentions aren’t wholesome, but malevolent.

How do I know, you ponder?

Some people make a living taking shit out of toilet bowls. They know just the right amount of times to plunger that bowl in order to get the coriolis effect going again.

Others sell drugs to people from inside nice, clean, stores, and can tell you just the right amount of pain killers one could take before passing out and going into cardiac arrest.

Why, some people make their living selling solar panels, door to door even. Those people can tell you which morons are most likely to buy said panels, just by looking at the expression of a person’s face.

I, on the other hand, have made my living by determining the levels by which markets set up to rally, following a rout. I’ve developed the algorithms using decades of market experience and have shared said algorithms with the retail public. My experiences in timing said bottoms have been so successful, I’ve dedicated the entirety of my trading career towards it and have left the field of professional money management, something I’ve partaken in, at a high level, since 1997.

Here is my track record, using the predictive algorithms inside Exodus since 2009.

When it’s oversold, members will be emailed, alerting them to this occurrence and I will purchase SPY. I’ll have you know, I’m highly proficient at what I do.

As for the state of stocks: dreadful. The Walmart numbers were a red herring. I hope you understood that I was being tongue in cheek when I praised them this morning. They merely beat lowered guidance. Moreover, strength at Walmart, traditionally, means people are poor and have abandoned all hope, so they shop there.

The market doesn’t want the Fed to hike, because it will lead to catastrophe of monumental proportions.

Copper continues to trailblazer, inexorably lower.

Palladium, a vital component in the manufacturing of cars, is getting crushed.

People continue to find safe haven in treasuries. It’s glib to believe you can predict the price action of treasuries via charts. It’s the biggest asset allocation in the world. Although popular, it is the primary indictment of everything that’s wrong with current economic policy. Moreover, it will continue to rise, as long as Europe and Japan are under negative interest rate regimes.

In a dramatic narrative change, American Eagle has joined Walmart this morning in asserting dominance over a tattered and beleaguered retail landscape, dispatching weak performing yam eaters like Target and Macy’s into the trash heap of history.

AEO posted better than expected results. Obviously, the fashion experts at AEO have hit a note with a quasi-retarded millennial generation, stocking their stores with tank tops, hipster dresses, hoodies and flannel shirts.

Reports Q1 (Apr) earnings of $0.22 per share, excluding non-recurring items, $0.04 better than the Capital IQ Consensus of $0.18; revenues rose 7.0% year/year to $749 mln vs the $731.07 mln Capital IQ Consensus.

Consolidated comparable sales increased 6%, following a 7% increase last year.
Gross profit increased 12% to $293 million and rose 170 basis points to a rate of 39.2% of revenue.
Inventory Total merchandise inventories at the end of the first quarter increased slightly to $334 million.
Second quarter 2016 ending inventory at cost is expected to be approximately flat.
Capital Expenditures For the quarter, capital expenditures totaled $24 million.
The company continues to expect capital expenditures to be in the range of $160 to $170 million for Fiscal 2016.
Co issues in-line guidance for Q2, sees EPS of $0.20-0.21, excluding non-recurring items, vs. $0.20 Capital IQ Consensus Estimate.
New CMO

Co announced that Kyle Andrew has been appointed EVP, Chief Marketing Officer, reporting to Chief Executive Officer, Jay Schottenstein, effective, June 6, 2016.

Share are surging in the pre-market, higher by 15%.

In what can only be described as great news for DKS shareholders, the company is guiding down comps and earnings for all of 2016 and 2017. Talk about having confidence in your brand and accountants. This company has it all.

Dick’s is citing ‘liquidation’ fuckery as the main driver in the guiding down of numbers. If I am to guess on my own here, without the help of Dick management, I’d say The Sports Authority is basically giving shit away, making it hard for Dick’s to compete. Ergo, the company is guiding lower as The Sports Authority winds the fuck down.

Reports Q1 (Apr) earnings of $0.50 per share, $0.01 better than the Capital IQ Consensus of $0.49; revenues rose 6.1% year/year to $1.66 bln vs the $1.66 bln Capital IQ Consensus.

Comps +0.5% vs. +0-1% guidance and +1% last year; same store sales for DICK’S Sporting Goods increased 0.4%, while Golf Galaxy increased 1.7%. First quarter 2015 consolidated same store sales increased 1.0%

Co issues downside guidance for Q2, sees EPS of $0.62-0.72 vs. $0.78 Capital IQ Consensus; comps down 1-4% vs. ests near +0.4%
Co issues downside guidance for FY17, sees EPS of $2.60-2.90 vs. $2.96 Capital IQ Consensus; comps -1% to +1% from +0-2%. The Company’s consolidated earnings per diluted share guidance contemplates expected liquidation activity in the market. It also includes the expectation of ~$100 to 200 million of share repurchases in 2016.

“Given the expected near-term liquidation activity in the market, we have adjusted our guidance to contemplate this dynamic. Over the longer term, we remain confident in our ability to aggressively capture displaced market share and to strengthen our leadership position.”

Shares are little changed in the pre-market.

It is being rumored this morning, in literary and well learned circles, that the U.S. economy might grow at the feverish clip of 2.25% in 2016. I’ll pause, as you digest this news.

Ok, I’m back.

Along those lines, it shouldn’t come as a surprise to any of you out there to learn that Walmart demolished earnings estimates this morning and are now going about the process of destroying all remnants of bearish sentiments around WMT.

Shares are spiking higher by 8.5% on this momentous occasion.

Reports Q1 (Apr) earnings of $0.98 per share, $0.10 better than the Capital IQ Consensus of $0.88; revenues rose 0.9% year/year to $114.99 bln vs the $112.68 bln Capital IQ Consensus.

U.S. comps +1% vs +0.5% guidance (+1.1% Q1 last year). Sam’s Club comps +0.1% vs flat guidance (excluding fuel).
Walmart U.S. delivered positive comp sales for the seventh consecutive quarter, up 1.0%, driven by the sixth consecutive quarter of positive traffic, up 1.5%. Neighborhood Market comp sales increased ~7.1%. Customer experience scores continued to improve.

Operating cash flow was $6.2 billion and free cash flow was $4.0 billion, both higher than last year due to solid operating performance and improved working capital management.

Consolidated operating income declined 7.1%, as planned investments in people and technology, as well as currency exchange rate fluctuations impacted results. Excluding currency, operating income decreased by 4.6%.

Co issues upside guidance for Q2, sees EPS of $0.95-1.08 vs. $0.98 Capital IQ Consensus; sees Wal-Mart U.S. Q2 comparable store sales up ~1%; Sam’s Club comparable store sales slightly positive ex fuel.

I’d like to point out that Target’s earnings miss is all the more meaningful this morning, from a managerial standpoint. It’s obvious that the economy is ‘pistol hot.’ Some say it might grow at 2.25%. The fact that Walmart crushed and Target missed is further proof that citizens of American prefer the brand of retail dystopia that Walmart is selling. Ergo, the shares are being graciously rewarded this morning.

I guess these cocaine addled psychopaths feel America needs more hedge fund activism in the U.S. government. Perhaps after watching a Bernie Sander speech, deriding hedge fund managers for being scoundrel billionaires, these guys thought the best way to fight back was to become an oligarchy, by forming a lobbyist group to promote their fucking interests.

I am not kidding you.

The Council for Investor Rights and Corporate Accountability (CIRCA) announced its formation on Wednesday, saying it is committed to promoting the actions of shareholder activists, and their positive impact on corporate governance and business policies at publicly traded companies.

The Washington D.C.-based trade association said it is backed by a consortium of activist firms, but does not name them in the press release. According to a person with direct knowledge of the matter, the group’s backers are: William Ackman of Pershing Square, Carl Icahn, Daniel Loeb of Third Point, Paul Singer of Elliott Associates and Barry Rosenstein of Jana Partners.

“CIRCA was founded on the widely accepted idea that a well-functioning system of checks and balances between boards of directors and shareholders is fundamental to long term economic growth and U.S. prosperity,” CIRCA Senior Advisor Rob

Are these people serious? How delusional is Bill Ackman anyway?

At the end of the day, according to ‘CIRCA’, this country needs more Wall Street influence, green-mailers and insider trading tips for the wealthiest people in the world.

Very sincerely, if I was bullish on equities I’d view this as a red flag to get the fuck out of dodge, before the market got upended by a most heinous drawdown. I only post Faber because I think he’s interesting. There are two types of people in this world, boring and interesting. I don’t value anything else, as far as character traits are concerned.

Oh, you’re smart?

Fuck you, so am I.

But now Faber is reducing his appeal by abandoning his end of days scenarios, for something far less ‘interesting.’ He likes gold and oil stocks and ‘feels’ everyone should own a diversified blend of real estate, stocks, bonds etc.

Fucking boring.

Dr. Doom is now bullish. Ergo, the market can now proceed down the rabbit hole into hell.

Oh, you don’t like how the game is played? I suggest you read Confessions of a Wall Street Analyst to understand how it’s played.

Early this morning, we were entreated to a Goldman Ball Sachs upgrade of TSLA, affixed with a price target of $250. In the afternoon, we were doubly entreated to a massive secondary offering with Goldman listed as one of the underwriters.

Tesla is offering about $1.4 billion of shares with the remaining shares to be sold by Elon Musk to cover tax obligations associated with his concurrent exercise of more than 5.5 million stock options. On a net basis, Mr. Musk will increase his overall Tesla shareholdings through these transactions. Tesla intends to use the net proceeds from this offering to accelerate the ramp of Model 3. In connection with this offering, Elon Musk, Tesla’s CEO, will also be exercising stock options to acquire 5,503,972 shares of Tesla stock.

Chinese wall prohibits the two departments (investment banking and research) from communicating with one another, yadda, yadda, yadda. No one believes you.

Coincidence or corruption?

On a side note, God bless Elon Musk.

Today was a very polarizing day for stocks. There were two camps, with clear divisions. There were the have’s and have nots, in the new ‘Fed hiking this June’ world. The have’s were the banks, semis and healthcare names, while the have nots were gold, oil, copper, steel and retail.

Naturally, nothing this neat and organized ends up lasting. But the rationale behind these moves is that the banks profit from wider spreads, semis have great balance sheets, and healthcare doesn’t give a shit if rates are 0% or 40%. Costs are still going higher.

On the other end of the spectrum, anything commodity based got taken down because the dollar was strong and borrowing costs went up, which is especially harmful to industries with lots of debt. Speaking of which, retail is levered up with debt too, which is why it fell hard today. Both copper and steel are red herrings for the overall growth picture in China. A stronger dollar will cause dislocations in China’s FX chicanery, which is what occurred in early 2016. Remember? Ergo, this scenario bodes poorly for Chinese growth.

But the market wasn’t being entirely true to this mantra, with the Dow off by just 4 and the Nasdaq up 23. The market, with an infantile demeanor, wanted to have its cake and eat it too. Well, I’ve got news for you: this hogwash, abstract, that was passed on as intelligent market positioning today will not last.