UBER - Disney Uber Starbucks And McDonald's Send A Powerful Signal To Investors But Momo Crowd Oblivious | Benzinga
To gain an edge, this is what you need to know today.
Consumer Pulling Back
Please click here for an enlarged chart of Walt Disney Co (NYSE: DIS).
Note the following:
- This article is about the big picture, not an individual stock. The chart of DIS is being used to illustrate the point.
- The chart shows the drop in DIS stock on earnings.
- Overall, Disney earnings were good. The reason the stock was hit is because Disney projects operating income for its Experiences segment which consists of parks will show no growth in the June quarter vs. a consensus of 12% growth. Theme parks are important for Disney as they account for 52% of its operating profit.
- The Arora Report’s detailed analysis of Disney’s earnings and conference call indicates that the consumer is now resisting high park prices and is pulling back.
- This morning, the stock of ride hailing and food delivery company Uber Technologies Inc (NYSE: UBER) is falling. In The Arora Report analysis, the main reason behind the drop in UBER stock is that the consumer is pulling back.
- On May 6, the big meat producer Tyson Foods Inc (NYSE: TSN) fell after reporting earnings. The Arora Report’s analysis of earnings show that the consumer is pulling back.
- On April 30, Starbucks Corp (NASDAQ: SBUX) fell after reporting earnings. In The Arora Report’s analysis of the earnings and conference call, the main reason behind SBUX earnings shortfall is that the consumer is pulling back.
- On April 30, McDonald's Corp (NYSE: MCD) reported earnings. The earnings showed flat to declining trends. n The Arora Report analysis, the reason is that the consumer is becoming price wary.
- The foregoing is just a sampling. The Arora Report analysis of earnings so far shows that the consumer pulling back is impacting a large number of companies.
- Further, The Arora Report analysis shows that about 60% of consumers are pulling back, but the remaining 40% are still on a spending binge.
- As a member of The Arora Report, none of the foregoing should surprise you – we have been sharing with you that liquidity of consumers at the low end was drying up.
- The U.S. economy avoided a recession for two reasons:
- Excessive consumer spending that was triggered by the free money from the government. This factor is now abating.
- Excessive fiscal spending by the U.S. government. This spending continues.
- The consumer ...