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Monday, September 12, 2022
It's September conference season on Wall Street!
Last week, I was camped out at the 29th annual Goldman Sachs retail conference in New York City.
We had some very insightful chats with Topgolf Callaway Brands CEO Chip Brewer (he signed off on the Topgolf acquisition), Shake Shack CEO Randy Garutti and CFO Katherine Fogertey (a former long-time Goldman analyst), Neiman Marcus Group CEO Geoffroy van Raemdonck (nice turnaround unfolding at Neiman), and many others.
Goldman's head retail analyst Kate McShane also weighed in on why she has a $2 price target on meme crowd fav Bed Bath & Beyond.
This week, I'll be stationed in San Francisco on Monday and Tuesday at the Goldman Sachs tech + media conference. Our coverage kicks off live on Yahoo Finance at 9:00 a.m. ET.
And while making the rounds at Goldman's conferences, I've been paying careful attention to similar events being held by Citi and Deutsche Bank. Always lots of learnings for investors to kick off September as summer comes to an end.
Here are 12 things that have surfaced in the last week I think are worth noting:
Not one executive I talked is seeing seeing trends in their business that hint the U.S. economy will be in a recession in the first quarter of 2023. That said, no one is speaking with a tone of an economy poised to crank into a much stronger gear.
Customer demand hasn't bounced back materially from the slowdowns seen at the end of the second quarter. The caution on the part of CFOs on the health of the economy is sticking around, and they continue to look for ways to cut costs.
There is palpable fear by multinationals on Europe entering a prolonged economic downturn at the hands of surging energy costs.
Fresh China lockdowns are weighing on demand in the country, particularly for multinational retailers.
Executives agree we haven't begun to see the impact of the Federal Reserve's rate hikes. There is a general distrust that the Fed can engineer a soft economic landing.
The PC correction has further to go — Intel, for example, issued a light profit warning for the current quarter at a Citi conference.
Intel's warning at Citi also suggested continued consumer spending sluggishness.
Yes, supply chains are improving.
No, inflationary pressures aren't easing a lot.
Price increases continue to be pushed through to customers.
The next six months could see the resumption of headline-making deals as companies look to get out in front of higher financing costs. This applies mostly to the tech sector, as valuations have plunged across the sector for attractive businesses.
If you are inclined to trade retail into the holidays, stick with ultra-high end plays. I was astonished to hear the strength of the spending trends at luxury players Neiman Marcus and Canada Goose at the Goldman conference.
I encourage you all to visit the investor relations pages of companies you are invested in to see if they are presenting at a conference this month. It's important you listen into the webcast.
Have a great week of wealth building! And remember: Sharks don't swim backwards.
What to Watch Today
No notable reports scheduled for release.