Archive for April, 2025

• Morning News: April 30, 2025
  Eddy Elfenbein, April 30th, 2025 at 7:03 am

  Thai Central Bank Cuts Rates To Support Economy Amid Uncertainty

  Canada’s Election Challenges Trump’s Theory of Trade War

  Trump Bashes Powell, Touts Tariffs at Rally Marking 100 Days

  Trump Predicts China Would ‘Eat’ Tariffs, Lessening US Impact

  Big Price Hikes Undermine Trump’s Bet China Will Absorb Tariffs

  What Trump’s New Port Fees Mean for Chinese Shipping and World Trade

  West Coast Ports Brace for China Tariffs to Dent Import Volume Within Days

  Vietnam Used to Be a Safe Haven for Trade. Now It Might Not Be.

  Israel to Expand Trade Eastward as It Looks Beyond War Economy

  Foreign Demand for US Assets Will Wane Unless the Dollar Slides More: Goldman Sachs

  C.E.O.s Face a New Trump Conundrum, Over Prices

  A $10 T-Shirt Could Become a $24.50 T-Shirt as a Key Tariff Loophole Closes

  Retailers Fear Toy Shortages at Christmas as Tariffs Freeze Supply Chain

  How the Common Wheelbarrow Holds Lessons for Trump’s Tariff Wars

  Europe’s Trading Desks Score Gains in Midst of Trump Tumult

  UBS Profit Tops Forecasts on Trading Boost, But Sees Unpredictable Path Ahead

  Credit Agricole’s Mixed Results Disappoint

  Mark Mobius Says His Funds Hold 95% in Cash on Trade War Risks

  Be Minimally Extractive

  Big Oil’s Profits Are Taking a Hit Even Before Trump’s Tariffs Start to Bite

  NYC Lost $9 Billion of Income to Miami, Palm Beach in Five Years

  A $6 Billion Shortfall Has US Mass Transit Facing a Death Spiral

  Meta Earnings Have High Bar to Clear After Shares Outperform

  Caterpillar Sees Slightly Lower Sales for 2025 Under Tariffs

  Stanley Black & Decker Raising Prices to Offset Tariff Costs

  Humana Reports Lower Medical Costs, Bucking Industry Trend

  Starbucks Needs a Jolt. It Got Some Cold Brew.

  DoorDash’s Bid for Deliveroo Marks End of Europe’s Food Delivery Boom

  Yum Brands Posts Higher Profit, Revenue Amid Complex Environment

  Newell Brands Says Tariffs Can Benefit Business, While Certain Levies May Dent 2025 Results

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• CWS Market Review – April 29, 2025
  Eddy Elfenbein, April 29th, 2025 at 5:49 pm

  (This is the free version of CWS Market Review. If you like what you see, then please sign up for the premium newsletter for $20 per month or $200 for the whole year. If you sign up today, you can see our two reports, “Your Handy Guide to Stock Orders” and “How Not to Get Screwed on Your Mortgage.”)

  Wall Street continues to chill out from the recent turbulence, but I’m not ready to sound the “all clear” alarm — at least not yet. The trade war is still causing problems, but even there, tensions are subsiding.

  There was a minor kerfuffle today between the White House and Amazon. The online retail giant said it was going to start listing the tariff costs of each item sold. The White House was furious, and President Trump called Jeff Bezos to voice his displeasure. Amazon said it’s not happening, and it was merely a proposed idea.

  The lesson here is that investors are picking up on the idea that tariffs hit consumers directly in the wallet. The Trump administration is looking to ease the “effect of auto tariffs by lowering taxes on foreign parts used in U.S.-made cars.”

  The softening in the trade war has helped the bulls finally gained some momentum. On Tuesday, the S&P 500 rose 32 points, or 0.58% for its sixth daily gain in a row. Combined, that’s a gain of 7.8%. The index is now less than 1% away from breaking above its 50-day moving average (the blue line). The Volatility Index dropped below 24 earlier today. A week ago, it was over 32.

  

  While that news is good to see, I’m not convinced that we’re out of the woods just yet. We’re in earnings season and the stock market just registered its worst gain of the first 100 days of a presidency in 50 years.

  As you know, I’m skeptical of any relief rally until it breaks above the 200-day moving average (the red line). We still need a gain of close to 3.4% to hit that level.

  Tariff politics have unnerved traders. Gold, for example, is near an all-time high, and the dollar is in rough shape. For the first time in many years, foreign stock markets are beating the U.S. market.

  We got the Consumer Confidence report today and it was ugly. The index fell 7.9 points to 86. That’s the lowest it’s been in five years. Wall Street had been expecting a fall to 87.7.

  The report also looks at “expectations” for the next six months, and that report cratered. The expectations index fell 12.5 points to 54.4. Expectations for stock market gains fell to a 14-year low. Respondents expect inflation to hit 7%.

  Earlier today, the Labor Department said that job openings fell last month by 288,000 to 7.192 million. The number for February was revised lower by 88,000 to 7.48 million.

  We’re in the thick of earnings season and so far, our Buy List’s earnings results have been quite good. Nine of our stocks have reported, and eight have beaten expectations.

  Rollins, the owner of Orkin, was the only exception, and it reported in line with Wall Street’s forecast. At one point, Rollins was down 7% for the day even though it was a perfectly fine report. Cooler heads prevailed and Rollins made back everything it lost. In fact, it’s rallied from there. We now have a 21.5% YTD gain in Rollins and the stock hit a new 52-week high today.

  

  This week, 180 stocks in the S&P 500 are due to report earnings, plus 11 stocks in the Dow Jones Industrial Average are due to report. Overall, earnings season is going well. For the fourth quarter in a row, net profit margins are running above 12%.

  It’s still early, but the latest numbers I’ve seen indicated that 36% of the companies in the S&P 500 have reported earnings Q1 earnings. Of those, 73% have beaten expectations. That may sound impressive, but it’s below the average beat rate of 77% for the last five years.

  Even though the beat rate is a tad below average, the size of the beats is quite good. The beat size is running at 10%. That compares with an average of 8.8% over the last five years, and 6.9% over the last 10 years.

  Bear in mind that Wall Street is very adept at getting expectations exactly where it wants them. They do this so they can later claim they’re beating expectations.

  Earnings growth for Q1 is currently tracking at 10.1%. That’s up from 7% last week and 7.2% at the end of Q1.

  Of the companies that have reported so far, 64% have beaten on revenue which is below the five-year average of 69%. Overall, companies are reporting sales that are 1% below expectations.

  For Q1, revenue growth is tracking at 4.6%. If this holds up, it will mark the 18th quarter in a row of revenue growth. For 2025, Wall Street expects earnings growth of 9.7%.

  Apple’s 20 Lost Years

  Over the weekend, I posted on X:

  If you had invested $10,000 in Apple on June 6, 1983, by April 17, 2003, you'd be sitting on $8,400.

  — Eddy Elfenbein (@EddyElfenbein) April 25, 2025

  I’ve posted that stat a few times before. This time, the tweet took off. At last count, the tweet has 4,100 “likes.”

  There were some replies that told me I had to be incorrect or that I was purposely posting wrong information to get attention.

  This is very odd to me because, as you surely know, your humble editor is a mild cupcake. I was even told that I was incredibly and unbelievably stupid because I failed to account for stock splits. You’d be amazed at how angry some people were.

  Well, the information I posted is right, and my critics are wrong. Over a 20-year run, Apple’s stock fell 16%. Here are the details:

  On June 6, 1983, Apple closed at an unadjusted price of $62.75 per share. Since then, Apple has split 224-1 giving it an adjusted price of 28 cents per share.

  On April 17, 2003, Apple closed at an unadjusted price of $13.12 per share. Since then, Apple has split 56-1 giving it an adjusted price of 23.4 cents per share.

  I did leave out dividends, but that was a very minor factor. Apple paid out a small dividend from 1987 to 1995, and then it stopped. The company didn’t resume a dividend payment until 2012.

  The important lesson here is that the largest publicly traded company in the world, one that is valued at more than $3 trillion, was dead money for more than 20 years. Over the following 22 years, it rose 900-fold. The big change came in 1997 when Bill Gates bailed out Apple with an investment of $150 million. It sounds incredible, but it really happened. That’s something to bear in mind the time next you enter a trade.

  This will be a particularly busy week for Wall Street. In addition to many more earnings reports, tomorrow we’ll get our first look at the Q1 GDP report. There’s a chance it could be negative although I’m expecting a number that’s low but positive. The consensus on Wall Street is for growth of 0.4%. Also on Wednesday, we’ll see the ADP report on private payrolls. Wall Street expects a gain of 140,000.

  On Thursday, May 1, we’ll get the initial claims report. If we see any weakness in the labor market, it may show up here first. We’ll also get a look at the ISM Manufacturing Index. This has been weak but nothing too bad.

  Then on Friday, we’ll get the April jobs report. Economists are expecting a gain of 133,000 and for the unemployment rate to hold at 4.2%. For wages, the consensus expects a gain of 0.3%.

  The Federal Reserve meets again next week. Don’t expect any activity with interest rates, although a rate cut may be coming in June.

  That’s all for now. I’ll have more for you in the next issue of CWS Market Review.

  – Eddy

• Morning News: April 29, 2025
  Eddy Elfenbein, April 29th, 2025 at 7:03 am

  Russia’s Oil Exports Edge Higher With Return of Sanctioned Ships

  Zombie Ships Are Fast Becoming a Feature of Venezuelan Oil Trade

  The World’s ‘Miracle’ Economy Loses Its Mojo

  Ireland’s Economy Surges as U.S. Businesses Stockpile Ahead of Possible Tariffs

  Spanish Economy Keeps Growing But Tariffs Set to Drag Momentum

  Eurozone Business Sentiment Takes Hit From Tariffs

  EU Bans Sale of ‘Golden Passports’ as Trump Opens Doors

  China Vows to Stand Firm, Urges Nations to Resist ‘Bully’ Trump

  Only in America — 100 Days of the Anti-Reagan

  China Is the Wrong Model for the US Economy

  Trump’s ‘Buoyant’ Trade Warrior Flexes His Power Over Global Business

  Why Trump’s Economic Disruption Will Be Hard to Reverse

  Goldman’s Solomon Says Markets Will ‘Settle Down’ After Disorder

  America Needs to Be Strong. Why Weaken Its Banks?

  HSBC Sounds Trump Tariff Alarm, Taking Shine Off Q1 Profit Beat and Buyback

  White House Tech Bros Are Killing What Made Them (and America) Wealthy

  As Musk Nears End of 130-Day DOGE Stint, He’s $113 Billion Down

  Shadowy Crypto Companies Make Inroads in U.S. Under Trump

  Secret Deals, Foreign Investments, Presidential Policy Changes: The Rise of Trump’s Crypto Firm

  Housing on Federal Lands Aims to Ease Affordability Crisis

  White House Looks to Take Steps to Ease Pain From Car Tariffs

  G.M. Withdraws Profit Forecast as Trump Tariffs Take a Toll

  Porsche and Volvo Become Victims of Deglobalization

  Amazon Launches First 27 Project Kuiper Internet Satellites

  UPS to Cut 20,000 Jobs After Amazon Breakup

  JetBlue Withdraws Outlook, Expects Soft Demand

  Pfizer Revenue Slides as Paxlovid Sales Fade

  Altria Reaffirms Guidance as Cigarette Sales Drop Nearly 14%

  Starbucks Says It’s Making Progress on Quest to Fulfill Orders More Quickly

  Be sure to follow me on Twitter.

• Morning News: April 28, 2025
  Eddy Elfenbein, April 28th, 2025 at 7:04 am

  Hungary Rejects US Pressure to Reduce Its Chinese Economic Ties

  China Holds Off on New Stimulus, Shows Composure in US Trade War

  Hegseth’s Reckless Leadership Endangers All Americans

  Trump’s Missing Climate Invite Makes US Look Even More Isolated

  Stop Scaring Future World Leaders Off US Campuses

  ‘Welcome to the Thunderdome’: Inside 100 Dizzying Days of Trump

  Trump Promised a Markets Boom. 100 Days In, Stocks Have Only Seen Damage

  Why We’re in ‘Trading Places’ Territory

  Unhedged and Burned, Stock Investors Brace for More Dollar Pain

  Trump Vs. Powell: Lots Of Misunderstanding Rooted In Lots Of Myth

  The Dollar’s Weakness Creates an Opportunity for the Euro. Can It Last?

  The Hidden Costs of Untimely Antitrust Enforcement

  New Details Emerge on Trump Officials’ Sprint to Gut Consumer Bureau Staff

  Trump China Tariffs Set to Unleash Supply Jolt on US Economy

  US Shoppers Pay for Trump Tariffs on Temu, Doubling Some Prices

  Tariffs Cut Both Ways for U.S. Upholstery Manufacturers

  Why Making an All-American Product Is So Hard

  Trump’s Tariffs Prompt Wave of Lawsuits as States and Businesses Fight Back

  China’s Ant Group Enters Brokerage Business with $362 Million Bright Smart Buy

  India’s Strengthening Supply-Chain Position Lures Even China

  Zepto Offers 16% Yield to Investors in India Private Credit Deal

  India Concludes $7.4 Billion Deal With France to Buy Rafale Jets

  Airbus Reaches Deal to Buy Spirit AeroSystems Plants

  Chinese Robotaxi Firm Pony AI on Faster Track to Profit After Cost Cuts, CTO Says

  Intel CEO Targets Change in Corporate Culture to Shape Up

  Sweetgreen’s C.E.O. on Robots, ‘MAHA’ and Why Salads Are So Expensive

  Behind the ‘60 Minutes’ Upheaval, a Big Merger Seeking Approval

  They’re on the Varsity Influencer Team

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• Morning News: April 25, 2025
  Eddy Elfenbein, April 25th, 2025 at 7:02 am

  China May Exempt Some US Goods From Tariffs as Costs Rise

  Chinese Electronics Makers Shrug, Joke and Wait for Tariff Chaos to Pass

  BYD First-Quarter Profit Doubled on Strong EV Sales

  Trump’s Tariffs Expected to Grind Germany’s Growth to a Halt

  Congress Loved Tariffs Long Before President ‘Tariff Man’ Trump

  What the Tomato Teaches Us About Free Trade

  World’s Finance Ministers Are Dazed and Confused

  Bessent Says He Wants Treasury Yields Down. Believe Him.

  The ‘Shouting Match’ Between Musk and Bessent is Part of a Larger White House Problem

  What Elon Musk Didn’t Budget For: Firing Workers Costs Money, Too

  Prince Alwaleed Plots Next Act With Billions Riding on Elon Musk

  Saudis Signal Oil’s Rout Won’t Hold Them Back

  The US Stock Market’s Tariff Exposure Is About to Be Laid Bare

  The Genius of TPI Can Only Be Realized With a Stable Dollar

  Markets Rise on Hints of Easing Trade Tensions

  BofA’s Hartnett Warns Sell the Rebound in US Stocks and Dollar

  US Bank Regulators Pull Back Guardrails on Bank Crypto Activities

  A Sign That Consumers Are Anxious: They’re Cutting Back on Snacks

  As Recession Fears Rise, ‘No Buy’ Takes On New Urgency

  Alphabet’s Sales Beat Estimates on Google Search Ad Business

  Apple Aims to Build Most iPhones for US in India by End-2026

  Accreditation Order Is Really About Controlling What’s Taught

  North America’s Oldest Firm Meets Its End. Some Argue Its Fate Was Avoidable

  WPP CEO Sees Client Unease Amid Tariff Uncertainty, But No Spending Cuts

  ‘More a Cheerleader Than a Regulator’: The FDA’s Untold Role in the Opioid Epidemic

  Universal’s $775 Million Downtown Music Bid Set for EU Probe

  No More Food Dye in Froot Loops? Not So Fast.

  A New, Full-Bodied Fraud Comes in a Whisky Barrel

  Be sure to follow me on Twitter.

• Morning News: April 24, 2025
  Eddy Elfenbein, April 24th, 2025 at 7:03 am

  Markets Fade as China Calls Reports of U.S. Tariff Talks ‘Baseless’

  On Major Economic Decisions, Trump Blinks, and Then Blinks Again

  Trump Takes On Improbable Task in Seeking Trade Deals Across the Globe

  Ken Griffin Says Trump’s Trade War Has Devolved Into a ‘Nonsensical Place’

  Beige Book Flashes Multiple Warnings About Who Pays for Tariffs

  Tariffs Are An Abomination: There Are No Good Arguments For Them

  Krugman: Cronyism, Capitulation and Utter Chaos

  For China’s Trolls, ‘Chairman Trump’ and ‘Eyeliner Man’ Are Easy Targets

  On TikTok, Chinese Manufacturers Open a New Line in the Trade War

  Analysts Game Out Use of Fed Toolkit if Market Needs Help

  Wall Street Missed Warning Signs Ahead of $1 Billion Fintech Implosion

  One of Wall Street’s Biggest Bulls Slashes View as Tariffs Bite

  Exhausted by Trump Reversals, Traders Get No Relief From Rebound

  The ‘Trump Put’ Makes an Entrance, Up to a Point

  Investors Prefer the ‘Nice’ Trump, but Want Results

  Gold Rebounds After Biggest Drop This Year as Dip-Buyers Step In

  Trump Is Facing Six Wars, and He’s Losing All of Them

  Trump Says Millionaire Tax Would Push Wealthy to Leave the US

  BNP Paribas Gets Boost From Market Frenzy

  They Stole a Quarter-Billion in Crypto and Got Caught Within a Month

  A Subdued Musk Backs Away From Washington, but His Project Remains

  The War on ‘Woke’ Universities Will Slow US Innovation

  It’s Electricity Realism, Not Climate Denialism

  How Solar Cells Could End Up in More Everyday Items

  Dow Logs Loss, Launches Cost-Cutting Measures Due to Slowdown

  Nissan Estimates Roughly $5 Billion Net Loss From Impairments, Restructuring Costs

  Merck Expects $200 Million Tariff Hit Amid Gardasil Fallout

  PepsiCo Cuts Growth Forecast, Citing Tariff Volatility

  Nestle Sales Get Boost From Coffee, Chocolate Price Hikes

  Nike Tries to Reclaim Sports Magic With Four-Minute Mile Attempt

  Be sure to follow me on Twitter.

• Morning News: April 23, 2025
  Eddy Elfenbein, April 23rd, 2025 at 6:56 am

  Trump’s Trade War With China Puts Japan in a Tight Spot

  Trump Tries to Push Tariff Fight to Trade Court With Better Odds

  Trump Floats ‘Substantial’ China Tariffs Cuts in Trade Deal

  China Has an Army of Robots on Its Side in the Tariff War

  US Chaos Is an Opportunity Europe Should Seize

  Trump Says He Won’t Fire Powell. His Fed Battle May Not Be Over Yet.

  White House is Right to Back Off the Fed

  Trump Tariffs Place Trucking Industry in the Crosshairs

  $1 Trillion of Wealth Was Created for the 19 Richest U.S. Households Last Year

  CEO Gloom Rivals Financial Crisis as Tariffs Hit S&P 500 Stocks

  Flash Boys Emerge From Shadows to Reorder Stock Trading

  Pimco Says Treasuries Are Starting to Look Attractive After Rout

  David Solomon’s Pay Hinges on Whether Goldman Is More Than Just a Bank

  NatWest Chief’s Pay Rises as Government Nears Share Exit

  DC’s Special Status Gets Ripped Up by DOGE’s Job and Cost Cuts

  Yale Signals That Private Equity May Have Peaked

  As Harvard Is Hailed a Hero, Some Donors Still Want It to Strike a Deal

  Apple and Meta Are First to Be Hit by E.U. Digital Competition Law

  Remember When Facebook Was Cool? Recalling a Bygone Era at Meta’s Trial.

  The Headlines Alone Reveal the DOJ’s Weak Case Against Google

  Intel to Announce Plans This Week to Cut Over 20% of Staff

  SAP Shares Jump After Earnings Beat Forecasts Despite Tariff Uncertainty

  Tesla Has a Deep Hole to Pull Out Of

  Elon Musk Warns Rare Earth Magnet Shortage May Delay Tesla’s Robots

  AT&T Beats on Mobile-Phone Customers After Verizon Miss

  Chobani, Seeing Rising Demand, Plans Giant Factory in New York

  From Hermès Bags to Sally Hansen Nail Polish: The Art of Jacking Up Prices

  Be sure to follow me on Twitter.

• CWS Market Review – April 22, 2025
  Eddy Elfenbein, April 22nd, 2025 at 5:24 pm

  (This is the free version of CWS Market Review. If you like what you see, then please sign up for the premium newsletter for $20 per month or $200 for the whole year. If you sign up today, you can see our two reports, “Your Handy Guide to Stock Orders” and “How Not to Get Screwed on Your Mortgage.”)

  Before this week, the battle on Wall Street was over tariffs. Now it’s over tariffs and interest-rate policy. President Trump took to social media to call Federal Reserve Chairman Jerome Powell, “a major loser.”

  In the history of White House/Central Bank relations, that’s probably one of the more polite salvos (Google “Andrew Jackson” and the “Bank War” if you want to see what I mean.)

  

  Wall Street was not particularly pleased with the president’s remarks. The U.S. stock market is now off to its worst start for a presidential term since at least 1928. The Dow is on pace for its worst April since the Great Depression.

  Somebody call T.S. Eliot!

  At one point in yesterday’s trading session, the S&P 500 was off by 3.4%. To put that in context, that day was worse than every single trading day in 2023 and 2024. Yet for this April, it would only be the fourth worst. Fortunately, we were spared somewhat as the market did rally off yesterday’s low.

  One interesting side note to yesterday’s sell-off was how broad it was. It’s as if every stock lost around 2.5% plus or minus 1%. Of course, that’s not literally true, but in no sense did we see the massive rotation action that we saw earlier this month. By this, I’m referring to days when growth stocks were through the floor but value stocks shot up. Or the opposite. Yesterday, most everything was down.

  Today’s recovery was perhaps even broader than yesterday’s. For example, the S&P 500 Growth ETF was up 2.71% today while the Value ETF was up 2.34%. That’s very narrow, especially for a big day.

  The narrowness of this market suggests that the market is most concerned with valuations on a broad level, not with any specific sector or industry. In plain English, yesterday Wall Street thought stock prices were too high. It walked some of that back today.

  Another optimistic item came today when Bloomberg reported that Treasury Secretary Scott Bessent believes that the “tariff standoff with China is unsustainable and that he expects the situation to de-escalate.”

  “Bessent also said the world’s top two countries essentially have a trade embargo in place, with both slapping tariffs of more than 125% on each other’s goods.”

  As for the Trump-Fed squabbles, the president may soon get his way. The FOMC meets again in two weeks, and I doubt anything will happen. After that, however, the Fed meets in June and I think there’s a very good chance that the central bank will cut rates by 0.25%.

  

  That may not be enough for the president’s liking, but traders expect three more rate cuts this year after the cut in June. It’s broadly understood that the president can’t fire the Fed chief unless it’s for cause, meaning something like misconduct. The Fed chairman can’t be dismissed because of a policy disagreement. Powell’s term isn’t up until May of next year, and things may be quite different then.

  Earnings from Moody’s and Mueller

  We had two Buy List earnings reports. I’ll cover these in greater depth in our premium newsletter (which you can sign up for here). I also want to stress how well our Buy List is doing against the broader market. In fact, in relative terms, the last several weeks have been some of our best in the 20-year history of our Buy List.

  Let’s start with Mueller Industries (MLI). This is one of those well-run small-to-mid caps that’s not well known on Wall Street. The company has a market value of roughly $8 billion. Since early 1992, the stock is up by 40,000%. You’d think that would attract more interest, but that’s not the case.

  I can’t say it’s completely ignored by Wall Street, but Mueller is currently followed by just one Wall Street analyst. Personally, I love finding little-covered stocks.

  Here’s a chart of Mueller. The S&P 500 (in red) looks like a flat line in comparison. It’s actually a gain of 1,150%.

  

  Mueller makes and sells copper, brass, and aluminum products. The company operates through three segments: Piping Systems, Industrial Metals, and Climate.

  For Q1, Mueller had operating income of $206.3 million. That’s up 12.4% over last year. Net income increased 13.7% to $156.4 million. Quarterly sales increased 17.6% to $1 billion. Mueller’s EPS rose 14.9% to $1.39. The lone analyst had been expecting $1.31 per share.

  During the quarter, the price for copper averaged $4.57 per pound. That’s up 18.4% over last year’s Q1.

  Mueller said that the increase in sales was attributable to the inclusion of sales from two recently acquired businesses, and also to higher selling prices related to the rise in raw material costs and tariffs. At the end of the quarter, MLI had a cash balance of $830.1 million.

  Regarding the quarter performance, Greg Christopher, Mueller’s CEO said, “We delivered very good results in the first quarter despite certain manufacturing disruptions, which have since been resolved, and the general economic landscape. We were particularly pleased with the positive contributions that our Nehring Electrical Works and Elkhart Products acquisitions made to our business, and we look forward to their continued improvement.”

  Regarding the outlook, Mr. Christopher continued, “While markets and demand are in line with our year end comments and outlook, the tariff and trade policies have presented new challenges. Although we largely manufacture our products in the countries where they are consumed, we are not immune to the effects of tariffs. Where required, our teams are proactively and diligently taking appropriate price actions and will continue to do so as necessary. As we have consistently demonstrated resilience during past periods of disruption, we are confident in our ability to effectively navigate the current environment.”

  Mueller is now going for just under 11 times next year’s earnings. The company pays a quarterly dividend of 25 cents per share, which yields about 1.4%. The stock got a nice 2.7% bounce in today’s trading.

  Moody’s (MCO) has been a great stock for us. We added it in 2017, and it’s been a big winner for us. I’m glad to see MCO is outpacing the market this year as well, although that means it’s down by less.

  For the quarter, Moody’s revenues increased by 8% to $1.9 billion. Moody’s business is really two businesses. There’s Moody’s Investor Service (MIS) and Moody’s Analytics (MA), which is the jewel in the crown.

  Last quarter, revenues at MIS increased by 8% to $1.1 billion. Revenue at MA increased by 8% to $859 million. Earnings increased 14% to $3.83 per share. That’s a healthy beat. Wall Street had been expecting $3.54 per share.

  Companywide, Moody’s had an operating margin of 51.7%. For MIS, it was 66% and for MA, it was 30%. Cash flow from operations was $757 million and free cash flow was $672 million.

  During Q1, Moody’s bought back 800,000 shares at an average cost of $481.77 per share and issued net 400,000 shares as part of its employee stock-based compensation programs.

  This was another very good quarter for Moody’s. The only downbeat is that it lowered its guidance for the coming year. Previously, Moody’s had been expecting full-year earnings to range between $14 and $14.50 per share. Now it sees 2025 earnings ranging between $13.25 and $14 per share. I think that’s a sign of the current environment instead of the health of Moody’s business.

  Shares of Moody’s rallied 4% today.

  Outside of earnings, we’ll have some important news items towards the end of next week. The ADP payrolls report will be out on Wednesday, April 30. The ISM Manufacturing report will be out the following day. After that, the April jobs report will be due out on Friday, May 2.

  Also on Wednesday, we’ll get our first report on Q1 GDP growth. Wall Street is not looking forward to this report. The consensus seems to expect Q1 GDP growth between 0% and 1%. That’s not very good. We’re not in a recession yet, but one may not be too far away. As it turns out, the major loser could be the economy.

  That’s all for now. I’ll have more for you in the next issue of CWS Market Review.

  – Eddy

• Morning News: April 22, 2025
  Eddy Elfenbein, April 22nd, 2025 at 7:04 am

  Yen Extends Gains to Break Psychological Level of 140 Per Dollar

  Trump’s Tariff Salvos Risk a $2 Trillion Hit to Global Economy

  US Imposes Tariffs Up to 3,521% on Southeast Asia Solar Imports

  Markets Are Discovering the Real Trump Trade Is ‘Sell America’

  Gulf Issuers Plan More Debt Sales, Undeterred by Recent Market Turmoil

  Bitcoin Rallies 20% During Market Turmoil to Diverge From Tech

  Gold Hits $3,500 as Trump’s Fed Broadside Sparks Flight to Haven

  Trump’s Tariffs Will Pay Off — for China

  Exceptionalism, Until the Landslide Brings It Down

  Yes, Trump’s Tariffs are Worse Than Expected — But Should You Sell Your Stocks?

  Trump, Upping Pressure on Powell, Again Calls for Rate Cuts

  US Bonds Have Never Been Risk-Free, and Never Will Be

  Angst Builds Inside Federal Agency Over Trump’s Moves Against Law Firms

  Harvard Sues Trump Administration as Funding Fight Escalates

  How Privatizing Social Security Would Impact Retirees

  Nomura’s Biggest Deal Since Lehman Creates $770 Billion Funds Unit

  Helvetia, Baloise Reach Deal to Create Switzerland’s Second-Largest Insurer

  Trump Shuns Europe, and Its Defense Industry Tries to Capitalize

  Big Oil Is Offshoring Its Prized Engineering Jobs to India

  The Profound and Compounding Growth Implications of Waymo

  UK AI Startup Wayve Makes Japan Debut After Nissan Partnership

  Canada’s Prime Minister Pushes Country to Become the Housing Factory of the World

  Cocoa Crunch Isn’t Over Yet as Top Growers Struggle With Supply

  3M Maintains Outlook as Tariffs Add New Risk to Turnaround

  Businesses Plead for Tariff Breaks After Trump Spares iPhones

  Dealmakers Are Struggling to Make Sense of Trump’s Antitrust Policy

  Three Factories, $355,000 and the Maddening Quest to Make a Clear Can

  Smiley Faces Are In. Animals Are Out. The Politics of Starbucks Cup Doodles.

  Be sure to follow me on Twitter.

• Morning News: April 21, 2025
  Eddy Elfenbein, April 21st, 2025 at 7:04 am

  Crime Syndicates in Southeast Asia Go Global, Defying Crackdowns

  China-Owned Supertankers Face $5.2 Million in Fees Per US Call

  China Warns Nations Not to Cut US Trade Deals at Its Expense

  China Is Finding Ways to Replace American Farmers

  China Wins Without Fighting While the US Flails

  DHL Suspends High-Value Deliveries to U.S. Consumers Amid Tariff Turmoil

  Japan Embraces Lab-Made Fuels Despite Costs, Climate Concerns

  BOJ Sees Little Need to Change Basic Rate Hike Stance

  Central Banks Stare Into Trade-War Abyss With Rate Cuts Primed

  Paul Volcker Never Was Precisely Because Monetarism Never Was, Nor Is

  Gold Hits Record as Dollar Sags and Trade War Concerns Persist

  Bitcoin Rebounds as Trump’s Push Against Powell Weakens Dollar

  Say ‘You’re Fired’ and Watch What Happens

  Trump’s Push Against Powell Is Latest Reason to Sell US Assets

  Fed’s Goolsbee Hopes US Not Moving to Where Monetary Independence is Questioned

  Trump Is Everywhere Except in the Economic Data

  The Trade Adviser Who Hates Trade

  Zuckerberg, Dimon Are Among Top Sellers Ahead of Tariff Stock Rout

  The Trump Billionaires Who Run the Economy and the Things They Say

  Trump’s Deals with Big Law Are Shakedowns in ‘Pro Bono’ Clothing

  Inside a Union’s Fight Against Trump’s Federal Job Cuts

  “More and More Cheating”: DOGE’s Cuts to the IRS May Have a Big Price Tag

  Tesla Bull Ives Warns of ‘Code Red’ If Musk Sticks With DOGE

  Aramco Agrees With China’s BYD to Explore New EV Technology

  Airbus Promised a Green Aircraft. That Bet Is Now Unraveling.

  A Weak Dollar and Record Gold Price Are More Bad News for Luxury Stocks

  Why It’s So Difficult for Robots to Make Your Nike Sneakers

  The Trump Tariffs Are Tilting the Scales in the Coke vs. Pepsi Battle

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