Wednesday, 23 Sep 2020

Chicago Business Barometer Unexpectedly Edges Lower In August

Stock Alert: Dell Technologies Rises 5% On Upbeat Earnings

Shares of computer hardware company Dell Technologies Inc. (DELL) are climbing more than 5% Friday morning after reporting earnings that surpassed analysts’ view.

Second-quarter earnings on an adjusted basis was $1.92 per share compared with $2.15 per share last year. Analysts polled by Thomson Reuters expected the company to report earnings of $1.39 per share.

Revenue for the quarter on an adjusted basis was $22.775 billion compared with $23.454 billion in the prior-year quarter.

During coronavirus pandemic, the company saw continued demand for remote work and learning solutions. Consumer revenue was $3.2 billion, up 18 percent, while commercial client revenue was $8.0 billion, down 11 percent.

New Homes Account for Biggest Share of U.S. Sales in 12 Years

U.S. homebuyers are favoring newly built properties at the highest rate in more than a decade.

New homes accounted for more than 12% of sales in the year through July, the biggest share since June 2008, according to an analysis by John Burns Real Estate Consulting.

Americans rushing to take advantage of historically low mortgage rates are finding few previously owned homes to choose from because listings are so scarce. A growing share of buyers are turning to homebuilders, which are now left with a four-month supply of properties, the lowest since 2013.

Read more: New-home sales surge to highest in almost 14 years

“Homebuilders have their foot on the gas, and rightly so,” said Rick Palacios Jr., research director at John Burns, which analyzed data from the government and the National Association of Realtors. “They’ve got a very unique window of opportunity to grow sales at a clip we haven’t seen this whole recovery.”

The share for new homes has climbed after bottoming at about 7% in the depths of the housing crash in 2011 and 2012. The rate was around 15% for much of the early 2000s.

Stock Alert: Ollie’s Bargain Outlet Slips 5%

Shares of Ollie’s Bargain Outlet Holdings, Inc. (OLLI) are currently slipping over 5% on Friday morning, despite the discount retailer reporting second-quarter results that trumped Wall Street estimates.

OLLI is currently trading at $100.96, down $6.03 or 5.64%, on the Nasdaq.

Second-quarter profit surged to $99.4 million or $1.50 per share from $25.2 million or $0.38 per share last year. Adjusted earnings improved to $1.04 per share from $23.5 million or $0.35 per share last year.

Sales grew 58.5% to $529.3 million, while comparable store sales increased 43.3%.

Analysts polled by Thomson Reuters estimate earnings of $0.53 per share on revenues of $398.67 million.

However, the company did not provide a guidance for the second half of the year due to the uncertainty related to COVID-19.

CEO John Swygert said, “We fully expect sales growth to continue to slow as we progress through the second half of the year.”

The rise and fall of Pier 1

Pier 1 Imports — the trendy home goods store that sold scented candles and wicker baskets to a generation of yuppies — has turned off the lights.

The brand that once challenged consumers to look "beyond the beige" filed for bankruptcy in February after years of lackluster sales. According to court documents, the company planned to close hundreds of stores and then reopen. But it announced in May it was winding down its entire business and selling off its remaining inventory due in part to the coronavirus pandemic.  

Pier 1 CEO Robert Riesbeck said in court papers that the company was the victim of a "perfect storm" created by a myriad of factors that have changed the way consumers and retailers interact. 

But analysts say changing consumer tastes, an influx of new competitors and several key decisions by management led to the company's downfall. 

So after more than half a century in business what really led to Pier 1's bankruptcy? And who has the most to gain from its fall?

Watch more:

Why US hospitals are closing
What airlines are doing to clean their planes

North Carolina officials say four people at Republican convention tested positive for COVID-19

DETROIT (Reuters) – Two attendees and two event support staff at the Republican National Convention in North Carolina tested positive for COVID-19, county-level officials from the state wrote on Twitter.

The official Twitter feed of Mecklenburg County, where parts of the convention were held this week, said all four people were “immediately isolated.”

Chicago Business Barometer Unexpectedly Edges Lower In August

A report released by MNI Indicators on Friday showed a modest decrease by its reading on Chicago-area business activity in the month of August, although the Chicago business barometer still pointed to growth.

MNI Indicators said its Chicago business barometer edged down to 51.2 in August from 51.9 in July, but a reading above 50 still indicates growth in Chicago-area business activity. Economists had expected the barometer to inch up to 52.0.

The Chicago business barometer came in above 50 for the second straight month after having sat below it for a full year.

The modest drop by the headline index came even though the production index improved further in August, increasing by 1.4 points to the highest level since June 2019. Demand also improved, with the new orders index inching up to a one-year high.

MNI Indicators said anecdotal evidence suggests the industrial and agricultural sector were hit the hardest and recovered only slowly, while the medical sector is faring very well.

Meanwhile, the report said the order backlogs index edged down by 1 point in August following a strong increase in the previous month. The indicator has been in contraction since August 2019.

The employment index ticked up 0.9 points but continues to indicate a contraction, as firms again noted staff reductions due to the Covid-19 crisis.

On the inflation front, MNI Indicators said prices paid at the factory gate decreased by 1.9 points in August after three consecutive months of gains.

Related Posts