NEWS
Buyers Flee Ahead Of Busy Week

U.S. stocks started with a bounce but faded throughout the session to close nearly flat. A busy week of earnings and economic data is keeping volatility elevated as investors and traders take a more cautious approach to buying the recent dip. Let’s see what you missed. 👀

Today's issue covers McDonald’s rare earnings miss, one semiconductor stock retail loves (and one they hate), and Tilray topping estimates. 📰

Here's today's heat map:

7 of 11 sectors closed green. Consumer discretionary (+1.67%) led, & energy (-0.86%) lagged. 💚

The Dallas Fed manufacturing index fell again in July, marking its 27th consecutive month in contraction territory. New orders fell sharply, signaling a pullback in demand as capacity utilization and shipments dipped, too. 🏭

Automaker Stellantis fell 4% to a new 52-week low after Deutsche Bank downgraded it from buy to hold, citing its inability to tackle key issues like inventory, pricing, and model age in a “tougher” environment. 🪫

Tesla shares rose 6% after replacing Ford as Morgan Stanley analyst Adam Jonas’ top pick in the U.S. auto stock space. Meanwhile, Rivian Automotive gained traction among retail investors, with Stocktwits sentiment hitting its highest level in a month. 🔋

Cybersecurity stock F5 Inc. soared 15% after reporting better-than-expected earnings and revenue. The stock is nearing its highest level in over two years as the cybersecurity space at large rebounds. 🛡️

And shares of life sciences company Revvity popped 9% after its adjusted earnings and revenue both topped expectations. 🔬

Here are the closing prices: 

EARNINGS
Retail Diverges From Price After McDonald’s Miss

Inflation has hit restaurant chains recently, as consumers look for deals and spend more money eating at home. As McDonald's earnings showed again today, fast food restaurants have not been immune to that headwind. 😬

The company’s adjusted earnings per share of $2.97 missed estimates of $3.07, while revenues of $6.49 billion came in shy of the $6.61 billion estimate.

Comparable store sales declined across every division, falling 1% YoY globally in its first decline since Q4 2020. While the company noted several external factors impacting performance, management also took responsibility for its inability to deliver the “value” customers sought. 📉

Recently, the company joined its industry peers in rolling out a $5 meal deal to entice shoppers back. Early results showed enough promise to entice 93% of the company’s franchisees to extend the promotion through August. 🍟

CEO Chris Kempczinski expressed confidence in the company's growth strategy. “...As consumers are more discriminating with their spend, we are focused on the outstanding execution of delivering reliable, everyday value and accelerating strategic growth drivers like chicken and loyalty,” he said in a statement.

Despite the stock stabilizing recently and prices rising 4% today, Stocktwits users remain skeptical about the company’s prospects, with sentiment sitting in “extremely bearish” territory. Several users questioned how margins could possibly hold up with the company so focused on promotional activity. 🤔 

It’s a valid concern and one that Wall Street is overlooking for now. We’ll have to wait and see who ends up being right.

As for where consumers are spending money, wellness-focused grocery chain Sprouts Farmers Market hit a new all-time high after earnings. It beat estimates handily and raised its full-year revenue and earnings outlook. 🛒

STOCKTWITS & 11thESTATE PARTNERSHIP
Get Your Piece Of The $200m Uber Settlement

In 2019, Uber went public and raised over $8.10 billion. Soon after, the company faced major financial losses and several accusations. Uber was criticized for bypassing local regulations in many areas and for ignoring serious safety issues, including sexual assaults, deaths from crashes, and fatal assaults before the IPO.

Uber agreed to pay $200M to investors to settle claims that its subsidies increased costs during the IPO and that planned cuts could have risked key growth opportunities.