Disclaimer: when we talk about that, that something has grown up, we mean a comparison with the same quarter a year ago. Since all issuers from the United States of America, then all indicators in dollars. Sources were used in the development of the material, hard-to-reach for users from Russia. Putting our hopes on, Do you understand, what to do.
CarMax: growth is nowhere to go
CarMax (NYSE: KMX), network of car dealerships, which specializes in used cars, reported on the results of the last quarter. Revenue increased by 138,4 %, and profit increased from 4.978 million to 436.756 million. Taking into account the rush demand for cars in the US, I would wait for that, that the next couple of districts, the company will be doing more than well.
Not everything is retail
The American consulting company FTI Consulting recently released a forecast for the development of online retail, which was compiled on the basis of a survey of authorized retailers and buyers. It has following inquisitive numbers.
Growth in prosperity. sixty-two percent of the buyers surveyed report, that at the moment they are in the best financial condition in relation to periodically before the onset of a strong epidemic, and thirty-nine percent reported, that their financial situation is now even better, than before a major epidemic. fourteen percent of those surveyed reported, that their financial situation is currently worse, than before a major epidemic, and only three percent rated their financial situation as “even worse, than before a strong epidemic". This is great news for all companies., who work in the consumer sector: means, Americans are not so bad with funds and you can count on an increase in their costs in the near future.
Direct purchases. sixty percent of buyers began to buy directly from manufacturers more often - through the online sales section, and thirty-six percent began to do it even more often. This news is ambiguous. For conventional retail chains, this is more of a problem in the long run., as this may threaten them with a drop in sales in the future. And for the manufacturers themselves, this is also not necessarily a plus.: Yes, revenue will grow, but the development of own capacities in the field of online commerce requires huge investments. AND, frankly,, the resulting marginality of this kind of business is very low and often even negative. At the same time, online cannot be completely ignored.: according to the report, the share of e-commerce in the structure of retail sales in the United States increased from 15,4% in 2019 to 19,8% in the first quarter 2021. And this share continues to grow., FTI predicts growth here at 13,5% this year.
Government and stimulus. According to FTI experts, strong performance of retail chains in the past second quarter is the result of generous handouts from the US government. End of U.S. stimulus through direct payments to households could lead to falling sales. This is the most controversial thesis of the report.. In the United States, savings rates have risen sharply over the past year and a half, which during the coronacrisis tried to save more money. So after the quarantine is lifted, Americans may well begin to actively spend money., to make up for lost. But this is only a hypothesis - how things are in reality, we will find out in the next six months.
Hegemony Amazon. 62% of buyer respondents said, that most of the purchases were made online on Amazon. The number is huge and raises questions about the representativeness of the sample. Suddenly here as in a joke: "vote, spent on the Internet, Showed, what 100% of the population uses the Internet ". On the other hand, it's still an indicator of Amazon's growing influence. But there's no need to rejoice here.: Amazon receives the main profit from the cloud computing segment - retail trade for the company is low-margin.
In any case, the report should be read by all, who invests in consumer stocks.
Ethical rage
The US Securities Commission plans to oblige listed companies to disclose information that, what do they do for, to fight threats, brought about by climate change. Apple and Microsoft backed the initiative - no wonder, because their businesses do not directly generate a large amount of emissions.
Nearly 90% companies from S&P 500 share information about, how much emissions they generate and how much renewable energy they use, - but on a voluntary basis, in separate reports. But only 16% of which report such data in their financial statements.
This SEC initiative met with opposition from a significant portion of businesses, also for the simple reason, that all these "climatic risks" are very difficult to calculate: there is no standardization in this area. Maybe, the SEC initiative will lead to it. And maybe, companies will be able to defend their right not to consider climate risks in court.
In any case, news of this kind is important for all investors without exception., since already at the regulatory level companies are imposed criteria for assessments and regulation, not directly related to the financial side of their activities. In practice, this may mean, that absolutely any company can now be targeted by regulators only because, that its leadership is not enthusiastic enough about the environmental policy of the state. Well, it's also indirect., but will support the Biden administration's plans to increase capital inflows into green energy.
In particular, в исследовании «Future Paths of Electric Vehicle Adoption in the United States: Predictable Determinants, Obstacles and Opportunities "found out, that without huge subsidies, there will be no large-scale electrification of transport in the United States. Obviously, the government thought about it and decided, that it is time to use the administrative resource to accelerate the “greening” of energy and transport, including at the stock exchange.
"But Enough About the Meat"
There are several news on meat producers. Sanderson Farms, according to some information, looking for potential buyers. It is not yet known, did they find a buyer and if so, at what price will the company be sold, but shares from such news have already increased by 17%. One of the possible buyers may be Continental Grain., in the event of a merger with it, a company will be obtained, which will control 15% chicken production in the USA, but there are other candidates. The news for Sanderson shareholders is very good, but still not guaranteed.
USDA plans to tighten rules for large meat producers like Tyson Foods and others. The Ministry of Agriculture wants to oblige large companies to set minimum regional prices, not to have a situation, when farmers have a natural race "to the bottom" and they are forced to constantly reduce the price, to sell at least something. The Ministry of Agriculture also wants to oblige them to buy meat at auctions, where pricing is transparent, - as opposed to private deals between producers and farmers, where low prices are often imposed on the latter. Meat producers attracted the attention of regulators thanks to the news of mass bankruptcies of farmers with a huge margin of the meat business: large producers earn a thousand dollars from the head of cattle they buy - much more than the industry standard 50-150 $.
If the regulators' proposals are implemented, then this will threaten to reduce the marginality of the business of the respective issuers with clear consequences for quotes.
back to school
Financial company Prudential Financial released a study of sentiment among workers in the United States based on their surveys. The most interesting points in the study are.
Retraining is not so bad. 53% workers are ready to be retrained, to change the field of activity. 43% Believe, that their financial prospects will worsen, unless they actively learn new skills. By the way, 74% managers are considered, that their team will become much more productive, if employees learn new skills. All this can lead to an increase in demand for the services of companies., engaged in online learning.
Layoffs on your own. 24% employees plan to leave their current workplace in the near future. Most Commonly Cited Reasons for Leaving: wage rate - 50%, work-life balance problem - 38% and lack of room for growth - 34%. Together, these factors mean, that wages in the US will rise, which can have bad consequences for the reporting of companies, dependent on low-paid labor. Warehouses will feel this especially acutely., retail and restaurateurs: to retain and attract workers will have to raise wages and offer benefits.
Real estate only moves up
According to the National Association of Realtors of the USA, the price of houses in the secondary market increased year-on-year by 23,6%, and the houses themselves, on average, find a buyer within 17 days after posting the ad. Obviously, that soon the price on the real estate market will become so inadequate, that this may deter many buyers from purchasing a home. Maybe, investors will have to invest in rent. Investment giant Blackstone Group, for example, recently bought a company for $6 billion, leasing 17 thousand residential buildings. In this regard, REIT, specializing in residential rentals, look like not the worst investment in the medium term.
