Finance

• Lennar had a solid Q3 and guided for sequential improvement, leading analysts to raise targets.
• Cash flow is sound and drives a robust capital return program that reduces the share count and pays dividends.
• The FOMC interest rate cuts are expected to broaden demand and strengthen the homebuilding market.

Lennar Corporation (NYSE:) has headwinds in 2024, including margin pressure, but that is the worst news. While the housing market at large is tepid, conditions favor home builders, driving business, cash flow, and capital returns. Looking forward, there is a catalyst for 2025 in FOMC rate cuts.

High rates and affordability impact consumer demand today, but the headwind is expected to become a tailwind as the rate-cut process progresses. To paraphrase comments from Lennar CEO Stuart Miller, the market is only expected to strengthen over time as affordability improves.

Lennar Outperforms in Q3; Guidance Underwhelms

Lennar had a solid quarter in Q3, with deliveries and backlog growing compared to the prior year. The company reported 49.4 billion in net revenue for a gain of 7.7% over last year, outpacing expectations by 260 basis points. The gain was driven by a 16% increase in deliveries offset by a “slightly” lower average selling price impacted by mix and incentives. Mix and incentives also impacted the margin, which contracted compared to last year but less than the consensus forecast reported by MarketBeat.

The new home gross margin contracted by 190 basis points, offset by improved SG&A. The net margin on home sales contracted by 180 basis points, leaving net earnings up 5% and ahead of the consensus. The GAAP EPS of $4.26 is up 10%, including mark-to-market impact and other one-offs, but the adjusted is still strong at $3.90, flat YoY, and $0.33, or nearly 1000 basis points above the average forecast. The takeaway is that cash flow remains robust despite normalization following two years of intense activity, and the guidance remains favorable despite falling short of the consensus forecast.

The company guidance is underwhelming relative to the consensus estimates but expects a sequential improvement in delivery and flat margins compared to Q3. While tepid relative to expectations, the guidance implies cash flow sufficient to sustain fortress-quality operations and value-enhancing capital returns. Capital return in Q3 included $519 million in share repurchases, not including the dividend, and helped to reduce the average count by 4.5% YoY.

Lennar’s Building Value for Shareholders

Lennar’s positive cash-flow quarter allowed it to build shareholder value while paying dividends, repurchasing shares, and improving balance sheet health. The balance sheet highlights include a net cash position, no debt on the revolving facility, and improved equity despite the more than doubling treasury shares. Equity is up 3.15% and is expected to continue growing over time.

Assuming that the FOMC tailwind begins to impact the market soon, capital returns could easily accelerate in 2025. The dividend payment is less than 5% of earnings, and the total capital return for the quarter is less than 50%, leaving ample room for increases without earnings growth. The consensus for 2025 is for greater than 15% growth and is likely a cautious estimate given the outlook for interest rates.

Analysts Sentiment Drives Lennar Higher

The consensus price sentiment and price target for Lennar are a little misleading. The rating is pegged at Hold, down from a Moderate Buy, and the price target lags the price action. However, the rating slipped due to an influx of new reports initiated at Hold, with price targets leading the consensus higher. The consensus is up 35% compared to last year and 7.5% since the Q3 release, leading the market to the high-end range and a new all-time high. With 75% of the fresh revisions ranging from $190 to $235, the new high will likely be reached; the question is when.

The technical action is suggestive, with the market trending higher and winding up for its next move. The caution is that recent action looks like a rising wedge and may signal a correction is near. Up 200% in the last two years and trading at record levels, the market is ripe for a correction. In that scenario, targets for support and rebounding are $180, $170, and $165. A move below $165 could lead to $140 and a deep-value opportunity.

Original Post

• Chinese stocks have surged up to 50% following stimulus measures from the government, sparking renewed investor interest.
• The stimulus includes mortgage rate cuts and easing property restrictions, boosting equities like Alibaba and JD.com by 31% and 51%, respectively.
• While momentum is strong, technical indicators suggest a potential short-term pullback, with stocks like Alibaba and JD appearing overbought.

Chinese stocks have been on a tear recently, surging higher by as much as 50% in some cases, following the Chinese government’s announcement of a series of measures to stimulate the slowing economy. The rally has sparked immense excitement among investors, who now wonder if the uptrend will continue or if it’s a temporary surge.

For months, Chinese equities had been underperforming due to many factors, including a sluggish economy, high interest rates, and a slow property market. As a result, many Chinese stocks were trading at depressed levels. That narrative shifted last week when Beijing began rolling out stimulus measures to combat the broader economic slowdown. Adding to the optimism was a recent announcement from China’s central bank on Sunday, stating that it would instruct banks to lower mortgage rates for existing home loans by October 31. This move is part of a broader plan to support China’s struggling real estate market, which has significantly affected the economy.

In conjunction with the central bank’s move, Guangzhou, one of China’s largest cities, announced the removal of all restrictions on home purchases. Similarly, Shanghai and Shenzhen also eased their respective curbs on buying properties. These sweeping reforms have contributed to the positive momentum, with Chinese equities posting substantial gains. For instance, the iShares China Large-Cap ETF NYSE: FXI jumped over 20% last month, with heavyweight companies like Alibaba and JD.com rallying 31% and 51%, respectively.

With this backdrop, the question is whether investors should chase the rally or wait for a pullback. While the economic stimulus has driven significant gains, some technical indicators suggest the rally could run out of steam in the short term. Let’s dive into the technicals of two prominent dual-listed Chinese stocks, Alibaba (NYSE:) and JD.com (NASDAQ:), to assess whether the risk-reward remains favorable for investors at these elevated levels.

Alibaba’s 38% YTD Gain Marks a Turnaround for Long-Term Investors

China’s internet retail giant, has seen a remarkable 31% surge over the past month, which has turned its year-to-date (YTD) performance positive, now up 38%. After enduring a prolonged period of underperformance, where the stock hovered near its 52-week lows for more than a year, the recent breakout has been a welcome change for long-term investors. The rally allowed BABA to break through resistance and finally escape its downtrend.

From a valuation standpoint, Alibaba remains appealing with a forward P/E of 11.17, positioning it as a solid long-term investment opportunity. However, in the short term, caution may be warranted. The stock’s Relative Strength Index (RSI) has climbed to 79, suggesting it has entered overbought territory. On Monday, the stock gave back some gains after initially gapping up, signaling that it might be digesting its recent move and possibly pulling back.

For investors with a long-term outlook, BABA still offers compelling value. However, it might be wise to exercise patience in the short term. The stock could find more attractive support closer to the $100 level, where it may stabilize before resuming its upward trajectory.

JD.com’s Rapid Rally Signals Potential Pullback After RSI Hits 85

JD.com Inc Adr (NASDAQ:), another consumer discretionary Chinese internet retail giant, has similarly exploded higher, with gains of 51% over the past month and 38% YTD. Like Alibaba, JD was trading near its 52-week lows before the recent surge, and the stock is now up 92% from those lows.

However, JD’s rapid ascent has pushed its RSI to 85.67, which indicates extreme overbought conditions. This suggests a short-term pullback is highly likely, as stocks rarely maintain high RSI levels for extended periods without some price consolidation. A potential support area for JD could be in the $36-$38 range, where previous resistance might now serve as a floor.

Despite the likelihood of a pullback, JD remains an attractive long-term play. The company trades at a P/E of 14.55 and a forward P/E of 9.61, placing it firmly in value territory. Analysts are also bullish on JD, with 10 rating the stock a “Buy” and four as a Hold, resulting in a consensus Moderate Buy rating.

***

Original Post

Betting against momentum and large-cap growth continues to be a losing proposition, at least in relative terms, for positioning US equity portfolios in 2024, based on a set of factor ETFs.

These risk premia have dominated for much of the year and it’s not obvious that the trend is set to change, based on trading through Oct. 2.

The iShares MSCI USA Momentum Factor ETF (NYSE:) still holds the lead year to date, posting a strong 29.4% total return.

That’s ahead of the rest of the field, in most cases dramatically so. The gain is also well ahead of the broad market’s 20.8% advance, based on (SPY).

Although all the major equity factors are posting year-to-date gains, the results vary widely. The weakest performer: is small-cap value (), which is up a relatively weak 3.7% in 2024.

Trends don’t last forever and so investors are watching for clues that may shift the dynamics of the horse race.

On the shortlist for possible catalysts are two events that could roil the economy and the financial markets in the weeks ahead: a port strike and an escalation of fighting in the Middle East.

For now, the US stock market has largely been unaffected. The is only slightly below the record high the benchmark reached last week.

The potential for reaction, however, is significant, depending on how each event unfolds in the days and weeks ahead. Perceptions about winners and losers in the upcoming US election could also alter market expectations.

Meantime, the technical profile for the factor leader (MTUM) still looks strong. The summer sell-off took a toll, but MTUM rebounded quickly and is close to a record high.

“While the stock market is grappling with a variety of worries — including escalating tensions in the Middle East, a port strike and election uncertainty — liquidity is key and there is plenty of it now that the Fed has started to cut interest rates.

That means markets can continue to grind higher,” says Mary Ann Bartels, chief investment strategist at Sanctuary Wealth. “Embrace October’s volatility, as there is still plenty of fuel left in this bull market,” she predicts.

Over the past few years, consumers have been buying more private-label products at the grocery store to save money — and the trend may be here to stay.

Amid renewed investment by grocers in their store-branded offerings, studies show many shoppers no longer see store brands as lower quality than name brands.

“For customers, the private brand is becoming not just a knockoff,” said Annie St-Laurent, senior director for Metro’s private-label portfolio.

“The growth is really good in private label.”

Grocers’ in-house brands — like Metro’s Irresistible and Selection, Loblaw’s No Name and President’s Choice, and Sobeys’ Compliments and Panache — tend to be priced lower than their name-brand competitors.

Private-label brands are “having their moment,” according to a report by agriculture-focused co-operative bank CoBank. Shoppers are choosing store brands more often as the recent bout of inflation pushed prices up by double digits in just a few years, and interest-rate hikes added to the pressure.

Retailers are responding to the uptick in interest by introducing new products and allotting more shelf space to their brands, said Peter Chapman, founder of consulting firm SKUFood.

“We’re seeing more depth within categories for private label as retailers see it as an opportunity,” he said.

3:06
Consumer Matters: B.C. shoppers angered over Loblaws’ lopsided discounts

Retailers have also been investing not just in new products, but also in branding and marketing, according to market research firm NielsenIQ.

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That’s the case for Metro, which in the coming weeks is launching a refresh of its core private label, Irresistible.

With a new logo, products, packaging and flavours, St-Laurent said Metro is looking to make the brand more visible throughout the store.

“We’re reviewing completely that branding to make sure we are visible, and that the customers are finding our product,” she said.

The rebrand comes as Metro has already been expanding its assortment to meet customer demand for private-label products, adding new formats and price points. Sales growth in private-label products has been outpacing national brands, said St-Laurent — shoppers are more open to trying private-label options these days, and it’s a trend the grocer expects to continue.

For Metro, “this is a priority,” said St-Laurent.

Over the past couple of years, Christy Laverty, from Burlington, Ont., started buying more store brands as prices rose.

Though she’s found some name-brand products are “deal breakers” for her family — Heinz ketchup and Kraft Dinner, for example — Laverty said she’s switched to private labels for many things including canned vegetables, beans and dairy products.

“Why spend another 50 cents on a can of kidney beans when you don’t need to?” she said.

Laverty said she’s now always willing to try the private-label version of a product and see whether it’s worth the switch.

She also said her pre-existing notion that private-label food might be lower quality has been challenged.

“I started to kind of recognize that the store brand, private label isn’t necessarily less quality,” she said.

Consumers’ perceptions of private-label foods have improved considerably since the last time interest in store brands surged, according to CoBank, which was around the time of the 2008 recession.

2:13
‘Another manifestation of corporate greed’: Food shoppers angry about inflation, deflating discounts

This means the increased share of private-label products in shoppers’ baskets is likely to have more staying power this time around, the report said.

Empire Co. Ltd., the company behind Sobeys, FreshCo, Safeway and other grocers, said in its 2024 annual report that it plans to continue growing and enhancing its portfolio of store brands.

In its 2023 annual report, Loblaw noted that customers’ increased focus on value “benefited the Company’s sales due to its strength in private label products, discount banners, and personalized promotions.”

The company even launched a new discount grocery banner this year under its No Name brand.

Grocers not only often get a better margin on private-label products but also see them as a sort of “loyalty program” that can keep shoppers coming back, said Chapman.

He thinks retailers will work hard to keep private-label sales strong through new products, marketing, promotions and shelf space.

“I would say there’s probably more focus on trying to make sure they do deliver because people are giving them more chances right now,” he said.

The increased competition could actually prompt some name brands to offer more frequent discounts or promotions, Chapman said.

For Victoria-based Kael Campbell, opting for private-label foods has made a big difference in his grocery bill as he shops for his family.

Whether he’s at Costco, Walmart or Thrifty Foods, Campbell said he often notices the prices of store brands are significantly lower for very similar products.

“It really adds up,” he said.

&copy 2024 The Canadian Press

Earlier this week, (NYSE:) reported for the first quarter of fiscal 2025, which were negatively received by the market, as evidenced by more than 6% drop following the report.

Although net profit surprised positively, revenues disappointed with the negative trend forecast to continue in the current quarter.

The sportswear giant is currently undergoing a major transition. This shakeup comes with a change in leadership, as John Donahoe steps down and the seasoned Elliott Hill takes the helm.

Hill, who has been with the company since 1988, rising through the ranks from a statistician, brings deep institutional knowledge to the role.

As the new CEO, Hill faces the significant task of steering the company through its next strategic phase while addressing the persistent challenges it has faced in the post-pandemic era.

Nike’s New CEO to Address Strategic Challenges

The fate of outgoing CEO John Donahoe was virtually sealed during the release of quarterly results at the end of June this year when the company’s shares fell in the range of 20% (the biggest one-day drop in the company’s history) after announcing a poor outlook for both sales and revenue growth for the next fiscal year.

The decision to change CEOs stems not only from the company’s financial performance but also from a lack of new product launches and the withdrawal of several long-established brands. Combined with rising competition from companies like On Holding and Deckers, these issues highlighted the absence of a clear, long-term strategy, further justifying the leadership shift.

The new CEO is starting with a clean slate, as evidenced by the fact that the company has withdrawn from the publication of long-term forecasts and the Investor Day has been postponed. Details of the new strategy will probably be known over the next few months, but there is already speculation about an emphasis on increasing innovation, especially in the running shoe segment.

The transition period and the uncertainty that comes with it aren’t favorable for stock prices, which may be vulnerable to sustained supply pressures in the short term.

Falling Revenues Spark Uncertainty

A review of key indicators from the past two years of quarterly results shows a consistent pattern: while earnings per share have regularly exceeded forecasts, a troubling trend has emerged in overall revenue growth.

Source: InvestingPro

In a wave of not-so-optimistic forecasts, expectations for the earnings per share ratio fell sharply in December, affected by 15 downward revisions with not a single upward revision.

Source: InvestingPro

Nike: Is the Stock a Buy?

Under such conditions, possible technical sell signals are solidly grounded in the fundamental situation, which, at least in the short term, is not conducive to the development of an upward trend.

Currently, the demand side has been braked during the formation of a price channel in the area of the local resistance level falling in the vicinity of $90 per share.

If the supply side manages to break out of the aforementioned structure with the bottom, then the way is opened for an attack on the region of $75 per share in the first place, and slightly lower located long-term minima at $70 per share.

The negation of the downward scenario will be the breaking of the tested resistance at $90 and the negation of the flag formation structure, which from a technical point of view opens the possibility of an approach even to $98, where, in addition, the long-term downward trend line falls.

***

Disclaimer: This article is written for informational purposes only. It is not intended to encourage the purchase of assets in any way, nor does it constitute a solicitation, offer, recommendation or suggestion to invest. I would like to remind you that all assets are evaluated from multiple perspectives and are highly risky, so any investment decision and the associated risk is at the investor’s own risk. We also do not provide any investment advisory services.

• As political and consumer trends become more volatile, a few stocks this month could be considered ‘must-haves’ for investor portfolios.
• Backed by tailwinds in their business models, Wall Street analysts see more upside ahead for each company.
• Bearish traders are bailing out of their short positions and are now being replaced by institutional buyers.

There are two ways to interpret global events happening right now, from a weakening state in consumer discretionary trends to the geopolitical conflicts taking place in the Middle East. The first and most common is to read about them in the news and never think of them again. The second is the way every investor should go about this sort of news (the ones that tend to drive markets the most).

Figuring out the implications for not only the S&P 500 but also specific industries and stocks can deliver outsized returns as long as investors understand the true depth of the situation at hand. With these conflicts and deteriorating consumer environments in the United States, there are three stocks that investors must keep in their portfolios to cushion any near-term volatility.

In the consumer financing space, Visa (NYSE:) offers investors some stability and potential upside even as credit card delinquencies are now on the rise. Then, as port strikers suspend a significant portion of the United States trade activity, routes going through Africa might benefit Tidewater (NYSE:) with pricing power, but then these routes need to be protected, particularly during these Middle East conflicts; which is where Lockheed Martin (NYSE:) comes into play.

Visa Stock: A Flight to Safety Amidst the Consumer Storm

There has to be a strong reason for bearish traders to stay away from Visa stock, a trend investors can gauge through the company’s declining short interest in the past quarter, with 3.5% contractions in the past month alone.

It may not come as a surprise that Visa stock now offers investors double-digit upside, especially considering it has recently traded down by 10% in the past month to give Wall Street analysts the opening they need to shine through their ratings. And shine they did, led by those at Morgan Stanley.

These analysts now see Visa commanding a price target of up to $322 a share, implying it needs to rally by as much as 16.3% from where it trades today. As Visa is a $501 billion behemoth, a double-digit upside means twice as much, given that large-cap stocks don’t usually move by that much.

Driving these views are the current earnings per share (EPS) growth forecasts from Wall Street. They expect to see $3.00 in EPS by the end of next year, which is 24% above today’s $2.42 net reported earnings. This growth may come from Visa’s higher credit quality and scalability over some of its competitors in the consumer finance space.

This could be why Warren Buffett kept Visa in his portfolio while also selling Capital One Financial (NYSE:) at the same time. Capital One is a tenth of Visa’s size, and its customer credit score profile is not nearly as high as Visa’s, which makes Visa an advantageous must-have stock during a shifting consumer tide.

Tidewater Takes Control: Leading the Charge in Freight Pricing Rates

The Middle East conflicts could severely disrupt the , slowing down or even blocking trade routes in products like oil and consumer goods. This is not something the United States can afford right now, as it is just getting over its victory lap after lowering .

So, Tidewater and its critical African and Middle East routes will become as important as ever, and this importance may give the company some additional pricing power to squeeze short-term profits. This could be why analysts are upgrading the stock, calling for profound double-digit upside potential.

Those at Raymond James led the latest wave of boosts as of August 2024, when these conflicts were just getting started. Their latest view calls for a price target of $138 a share along with a Strong Buy rating.

The stock would need to rally by as much as 92.3% from where it trades today to prove these targets right.

Even bearish traders figured it wouldn’t be worth betting against Tidewater stock, which is why the company’s short interest collapsed by 15.9% in the past month, following a massive decline of $300 million over the quarter as well.

Lockheed Martin Stock: A Key Player Amid Rising Global Conflicts

Now that these conflicts are on the rise and the trade routes are threatened, there is one stock that investors should consider in these situations. Arms and defense stocks tend to do well in these environments, so it shouldn’t surprise to see Lockheed Martin stock trade at 95% of its 52-week high today.

While buying near the highs may seem a little risky, investors have a few reasons to keep this name in their portfolios for the coming months. There are those on Wall Street who would also agree with taking on this view of Lockheed Martin.

Analysts at Bank of America reiterated a Buy rating on Lockheed Martin stock at the end of August 2024, this time with a $635 price target. The stock must rally by an additional 5.3% from today’s price to prove these analysts right.

While this may not seem like that much upside, it is enough to get some institutional buyers back in the game. Ameriprise Financial (NYSE:) and Legal & General Group (OTC:) decided to boost their holdings by a respective 1.7% and 14.9%, bringing their positions to $902.7 and $646.8 million each.

Original Post

• Microsoft shares have been trending solidly upward since August’s low.
• The stock’s technical performance is bullish, as are recent analyst updates.
• Some concerns exist, but these are more than outweighed by the positives.

Since hitting a record back in July and then selling off, shares of tech titan Microsoft Corp (NASDAQ:). have been a bit slower than others in getting back to highs. For context, the benchmark was hitting fresh highs by the middle of September and, as recently as Monday, was closing at a new record.

Confirmation from the that they’re going to start cutting rates and continuing signs that is cooling have combined to re-ignite the risk-on sentiment that controlled stocks for much of the first six months of the year. Against the S&P 500’s 12% gain from its August lows, Microsoft has tacked on as much as 14%, but a week of losses means it’s holding on to less than 10% of them right now.

However, despite what appears to be this lackluster performance, there are several reasons to think that Microsoft is a solid buy right now and that any further selling will only boost its risk/reward profile. Let’s jump in and take a look.

Microsoft’s Fundamental Performance

To start with, let’s look at Microsoft’s fundamental performance. It’s worth pointing out that Microsoft’s most recent earnings report had a lot to do not only with its stock’s selloff in August but also with the bullish outlook investors and analysts have for it. The company smashed analyst expectations on both its headline numbers, which was always a good sign but then provided lighter-than-expected forward guidance for revenue from its Azure cloud unit.

Considering how softly Microsoft shares had been trading throughout July, it was understandable that a weak outlook like this sent them even lower. But what really compounded matters was the fact that the broader market started sinking the following week, as a dodgy jobs report ignited concerns that the Fed had delayed cutting rates too long.

Wall Street Targets Suggest Major Upside for Microsoft Stock

However, for those of us on the sidelines thinking about getting involved, there’s actually . Despite issuing weak forward guidance for a key part of the business and then enduring one of the wider stock market’s worst weeks in years, shares of Microsoft have been gaining since the first week of August. Not only have they been gaining, but they’ve been setting a pattern of higher, lower, and higher highs. This is one of the most bullish setups out there and indicates that there is a constant source of demand for Microsoft shares during any dip.

Considering the stock has fallen about 5% in the past two weeks alone, we could soon see this source of demand being tapped again. Beyond the promising technical performance, Microsoft shares are also enjoying the benefit of being highly rated by Wall Street analysts.

Take DA Davidson, for example, which reiterated its $475 price target on Microsoft shares in the last week of September. From where the stock closed on Tuesday evening, that suggests a targeted upside of nearly 15%. There’s also the $506 price target from Morgan Stanley last month and the $550 target from Wedbush in the aftermath of Microsoft’s earnings. It’s not often that analysts call for a potential upside of 30%, but that’s the case with Microsoft.

The Bottom Line: Microsoft’s Dip Could Be a Strong Buying Opportunity

Some concerns are worth noting, such as those of Allspring Global Investments, which noted earlier this week:

“There’s some AI fatigue when it comes to companies like Microsoft, given the incredible run they’ve had.”

There have also been some unfavorable comparisons between Microsoft and Oracle Corporation (NYSE:) in this regard, given the fact that the latter is trading at a lower valuation.

However, aside from the weaker-than-expected Azure update, which has surely been properly baked into Microsoft’s shares by now, there are far more reasons to like the stock than to avoid it. The technical case is strong, while the analysts’ targeted upside speaks for itself. Let’s see if the current dip can start finding some buyers in the next few sessions and turning north once again.

Original Post

Major market movers Tesla (NASDAQ:), Nike (NYSE:), and Humana (NYSE:) faced significant challenges on Wednesday, with all three stocks experiencing notable declines at the time of writing (10:57 AM EDT).

Tesla’s Q3 deliveries fell short of expectations, Nike withdrew its full-year guidance amid a CEO transition, and Humana saw a dramatic drop in its Medicare Advantage quality ratings. These developments led to substantial stock price decreases, with Humana suffering the most severe blow, down over 16% in morning trading.

Tesla: Delivery Growth Falls Short of Expectations

Tesla’s third-quarter deliveries reached 462,890 vehicles, marking a 6.4% increase quarter-over-quarter and the company’s first growth in 2024.

However, this figure slightly missed Wall Street expectations of 463,897 deliveries. The Model 3 and Model Y accounted for 439,975 of the total deliveries. Despite the growth, Tesla’s stock plummeted following the announcement, closing the day at $249.02, down 3.49%.

The electric vehicle maker now faces the challenge of delivering a record 516,344 vehicles in Q4 to maintain its 2023 delivery levels, all while battling increased competition in China and Europe.

Nike: Guidance Withdrawn Amid CEO Transition

Nike reported disappointing for fiscal year 2025, with revenue of $11.59 billion missing estimates of $11.65 billion.

The company’s stock declined after the report, closing the day at $83.10, down 6.77%. Nike Direct revenues fell 13% year-over-year to $4.7 billion, while wholesale revenues dropped 8% to $6.4 billion. In a surprising move, Nike withdrew its full-year guidance and postponed its upcoming investor day amid a CEO transition.

Elliott Hill, a former Nike executive who retired in 2020, is set to replace John Donahoe as CEO on October 14, 2024.

Humana: Medicare Quality Ratings Plummet

Humana faced the most severe stock decline among the three, with shares plummeting 11.79% to $246.49. The healthcare giant reported a significant decrease in its membership for 4-star Medicare plans and above, falling from 94% in the prior year to just 25% for 2025.

This drastic reduction was primarily due to the downgrade of Humana’s H5216 contract from 4.5 stars to 3.5 stars, affecting approximately 45% of its Medicare Advantage customers. The decline in performance is expected to impact Humana’s quality bonus payments in 2026, leading to concerns about future revenue. Humana’s stock is now on track for its worst day since 2009, with year-to-date returns at -48.42% compared to the ’s +19.60%.

***

Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.

This article was originally published on The Tokenist. Check out The Tokenist’s free newsletter, Five Minute Finance, for weekly analysis of the biggest trends in finance and technology.

• SLB is an attractive name as oil companies make up for lost time on infrastructure spending.
• This lithium miner is an attractive alternative if you’re still hesitant to buy China stocks.
• Investors should consider this medical stock even with short-term supply chain concerns.

At many points in September, investors heard about the hitting a record high. But at several points in that month, the index pulled back instead of moving higher. This is called a resistance level, a technical point where buying activity weakens, leaving room for sellers to come in.

You’re well aware of this price movement if you’re invested in an exchange-traded fund (ETF) such as the SPDR S&P 500 ETF Trust. The SPY is up just 0.29% in the 30 days ending October 1.