Abercrombie & Fitch (ANF) is trading with notable volatility today after reporting first-quarter results that outpaced expectations but included a lowered full-year profit outlook due to rising tariff pressures. The specialty-apparel retailer posted adjusted EPS of $1.59, well above the $1.36–$1.41 range analysts forecast, on record net sales of $1.10 billion versus projections near $1.06 billion‍. Yet, management trimmed its FY25 EPS guidance by roughly $0.90 at the midpoint to $9.50–$10.50 (from $10.40–$11.40), citing an anticipated $50 million headwind from tariffs, primarily on Chinese-sourced merchandise.

Comparable-store sales rose 4 % overall, comfortably ahead of the 2.3 % consensus.

• Hollister was the star, with comps up 22–23 %, driven by strong demand for new denim and seasonal assortments.
• Abercrombie brand comps declined 4–10 % as it cycles tougher prior-year comparisons‍.

Geographic performance was broadly positive:

• EMEA led with a 12 % comp gain as European markets benefited from refreshed store layouts.
• The Americas and Asia Pacific markets each delivered mid-single-digit comp growth.

Margin pressures stem from:

• Tariffs: A 30 % levy on Chinese imports is expected to cost roughly $50 million this year.
• Freight & logistics: Elevated ocean-freight rates and inventory repositioning added another 1–2 pp drag on gross margin.

Q2 guidance:

• Net sales growth of 3–5 %, slightly below the 4.1 % Street estimate.
• Adjusted EPS of $2.10–$2.30, versus a consensus of $2.56, reflecting continued margin headwinds.

Inventory & cash flow:

• Inventory ended the quarter flat year-over-year, indicating tight stock management despite strong demand.
• Cash and equivalents rose to $1.2 billion, bolstering financial flexibility for marketing and share repurchases.

CFO Robert Ball emphasized that tariffs are “embedded in our assumptions” and that the team has reshaped its supply chain to diversify away from China over the next 12–18 months. The company also reiterated its multiyear target of mid-teens operating margins, suggesting aggressive expense control and pricing actions will be key to offset cost pressures. While the EPS beat and robust Hollister performance underscore the brand’s resilience, the EPS guidance cut and tariff headwinds introduce uncertainty. Investors will watch Q2 execution closely, particularly the rollout of higher price points and continued shift in sourcing. Over the near term, ANF’s ability to navigate trade-policy risks and sustain comp-store momentum will determine if today’s pullback sets up a buying opportunity or signals deeper margin erosion ahead.

For decades, Google (GOOG) has reigned supreme in the search engine kingdom. But a challenger emerges, wielding the power of Artificial Intelligence: OpenAI. With Google recently rolling out its AI chatbot Gemini, the stage is set for a battle for the future of search engine dominance.

With OpenAI seeking trillions of dollars in funding, its search engine plans appears a little too ambitious at the moment. While shares of Google dipped following the report by The Information last week, the pullback was likely sparked by some sector rotation. Mega caps have been under pressure lately ahead of the pivotal NVIDIA(NVDA) earnings report on Wednesday. Investors await to see if AI implementation has sustained its outsized demand.

We urge caution buying any AI-related stocks before NVDA reports this week, Google included. However, if the stock continues to retreat, it may offer a decent buying opportunity.

Looking at the daily timeframe below reveals an obvious uptrend. Shares closed below their 50-day moving average (142.89) on Friday, an indicator that offered support earlier this month. However, after slipping back into the channel, shares are testing support at the trend line. Given how much AI has likely propped up the market this year (and much of last year given the disparity between the S&P 500 and its equal-weight counterpart (Ticker RSP), markets may chop up until Wednesday when NVDA reports earnings after the close.

Even though the potential ramifications of OpenAI encroaching on Google's territory are vast, any fear at the moment would likely be overblown, magnified by shares of Google reaching all-time highs late last month.

We recommend holding off on buying Google until after NVDA reports earnings on Wednesday, assigning a Hold rating at the moment. Shares could quickly snap back to all-time highs if NVDA blows out analyst forecasts. However, given the past two reports from the AI giant, it would not be surprising to see profit-taking on NVDA only for shares to establish a higher low and ultimately begin their climb back to all-time highs. If NVDA sells off, Google may tick toward its 200-day moving average (109.82), which would present a much more attractive entry point.

Honeywell (HON), the industrial conglomerate known for its aerospace, building technologies, and performance materials, released its Q4 2023 results recently. While the report boasted solid numbers, exceeding analyst expectations on both revenue and earnings, its modest stock price pullback suggests a deeper story at play. Let's delve into the numbers and understand why investors remain cautiously optimistic.

• Honeywell recorded a revenue increase of 8% year-over-year, reaching $9.8 billion, surpassing analyst predictions. Earnings per share (EPS) also outperformed expectations, clocking in at $2.61 compared to the anticipated $2.52. These figures showcase the company's resilience in a challenging economic climate.
• However, while Honeywell projected low single-digit revenue growth for 2024, this fell short of analyst expectations of mid-single digit increases. Additionally, the company hinted at potential margin pressures due to rising raw material costs and supply chain bottlenecks.
• This cautious outlook, despite strong Q4 results, triggered concerns among investors who had priced in more robust growth prospects. The fear of slower-than-anticipated expansion in key segments like aerospace and building technologies cast a shadow on the otherwise positive report.
• Several factors contributed to the cautious sentiment surrounding Honeywell's future. The muted guidance raised questions about Honeywell's ability to maintain its recent momentum, particularly in a potentially slowing global economy. The possibility of margin erosion due to cost pressures added to investor anxieties, impacting their profitability expectations. With the stock already trading at a premium valuation, some investors believed future growth was already priced in, leaving limited room for upside surprises.

Despite the recent pullback, Honeywell's fundamentals remain strong. Its diverse portfolio, solid execution, and track record of innovation position it well for long-term growth. However, navigating the headwinds of rising costs, potential economic slowdown, and investor expectations will be crucial.

The coming quarters will be telling. Investors will be closely watching if Honeywell can deliver on its cautious guidance, mitigate cost pressures, and reignite optimism about its future growth trajectory. Ultimately, navigating this balancing act will determine whether the recent stock price pullback is a temporary blip or a harbinger of a more prolonged correction.

Advanced Micro (AMD) sent shockwaves through the tech industry with its Q4 earnings report, missing analyst expectations and guiding for lower-than-expected revenue in the coming quarter. This triggered a drop in its stock price, raising questions about the company's future and potential ripple effects for its competitor, NVIDIA (NVDA).

• AMD delivered on revenue, reaching $5.9 billion, exceeding estimates. However, earnings per share (EPS) of $0.69 fell short of the expected $0.71. The core culprit? Data Center revenue, a key growth engine, missed expectations by a significant margin. This segment, fueled by AMD's EPYC server processors, was expected to surge due to rising demand for cloud computing, but fell flat.
• The real blow came with AMD's Q1 2024 guidance. The company projected revenue of $5.3 billion, significantly below analyst expectations of $6.2 billion. This cautious outlook, citing macroeconomic headwinds and inventory adjustments, spooked investors, leading to the sharp sell-off.
• While AMD's stumble raises eyebrows, it's not an automatic harbinger for NVIDIA. NVIDIA's focus on gaming and professional graphics cards differs from AMD's emphasis on server processors. While economic slowdowns could impact both, the exact timing and severity might vary.
• NVIDIA also remains on a growth trajectory, with Q3 exceeding expectations and strong guidance for the current quarter. Meanwhile, NVIDIA holds a dominant position in the AI chip market, a sector expected to see continued growth irrespective of short-term economic fluctuations.

NVIDIA reports its earnings next month, and investor focus will be sharp. While AMD's stumble might cast a shadow, NVIDIA's individual performance and future outlook will hold the key to its stock price movement. The coming weeks will be crucial in determining whether the tech sector experiences a broader pullback or if individual companies can navigate the headwinds and maintain their growth trajectories.

Alphabet (GOOG) reported mixed results for its December quarter, missing analyst expectations on both revenue and earnings per share. While the company maintained its dominance in online advertising, concerns about slowing growth and rising costs triggered a significant sell-off, sending the stock price lower today.

Revenue was $75.94 billion, up 32% year-over-year but below analyst estimates of $76.1 billion. Earnings per share was $1.53, missing the consensus estimate of $1.58. Advertising revenue was$61.21 billion, up 33% year-over-year but also falling short of expectations. Cloud revenue was $5.5 billion, up 41% year-over-year and exceeding expectations.

Why did shares still sell off?

• Ad growth slowed. While Google's ad revenue continues to grow, the pace of growth is decelerating compared to previous quarters. This raises concerns about the sustainability of the company's core business, especially in a potentially weakening economic environment.
• Costs rose. Google is facing rising costs across the board, including employee salaries, marketing expenses, and cloud hosting fees. These rising costs are eating into the company's profitability, further dampening investor sentiment.
• Competition continues to intensify. Google faces growing competition from other tech giants like Amazon and Microsoft in the cloud computing and advertising markets. This competition could put further pressure on Google's margins and growth prospects.
• Shares recently hit all-time highs. Investors are using the weaker-than-expected performance to take profits off the table.

Despite the disappointing Q4 results, Google remains a dominant player in the online advertising and cloud computing markets. The company has a strong track record of innovation and execution, and it is well-positioned to capitalize on long-term growth trends. However, investors will be closely watching Google's ability to address the challenges of slowing growth, rising costs, and increased competition in the coming quarters.

Overall, Google's Q4 earnings report highlights the challenges facing the tech industry in a more uncertain economic environment. While the company remains a leader in its core markets, investors are demanding more clarity on its future growth prospects and its ability to navigate these challenges.

General Motors (GM) roared back into investor focus today, with its Q4 earnings report sending the stock price up significantly today. While the headline numbers might seem impressive, it's not just the immediate financials driving this buying frenzy. A closer look reveals a shift in investor sentiment, fueled by a potent cocktail of optimism and strategic bets that GM seems to be placing on the future.

On the surface, GM delivered a solid performance. Revenue for the quarter climbed 8% year-over-year, defying concerns about chip shortages and economic headwinds. Profit after tax also came in well above analyst expectations, showcasing the company's ability to navigate a challenging environment.

However, the real excitement lies beneath the surface. Here are some key factors driving the current buying boom.

• Investors are thrilled with GM's aggressive push into electric vehicles (EVs). The company delivered over 40,000 EVs in the quarter, a significant jump from earlier figures. Moreover, GM's ambitious "Ultium" battery platform, underpinning its new EV lineup, has received positive reviews, showcasing its technological prowess in the burgeoning EV market.
• GM's core truck business remains a cash cow, with robust demand for its Silverado and Sierra models. With rising gasoline prices potentially pushing consumers towards fuel-efficient trucks, GM is well-positioned to capitalize on this trend.
• Investors are taking notice of GM's growing focus on software-defined vehicles. The company's recent acquisition of Cruise, a self-driving car leader, and its investments in other autonomous driving technologies, are seen as strategic bets with long-term potential.
• GM continues to impress with its financial discipline. The company reduced its debt by $8 billion in the quarter, signaling its commitment to fiscal responsibility and its focus on returning value to shareholders.

Of course, challenges remain. Rising material costs and potential supply chain disruptions could pose hurdles in the future. Additionally, the highly competitive EV landscape keeps pushing GM to innovate and stay ahead of the curve.

However, for today, optimism reigns supreme. General Motors' Q4 report served as a powerful demonstration of the company's resilience, strategic vision, and potential in the burgeoning EV market. This, coupled with its financial discipline and strong core business, has ignited a buying frenzy that shows no signs of slowing down. Investors seem to be betting on GM's ability to rev up its growth engine and drive into a prosperous future, making it a stock to watch closely in the months and years ahead.

Whirlpool (WHR), the home appliance giant, churned out its Q4 earnings report this week, leaving investors feeling more like they'd been through a spin cycle than a gentle rinse. While the headline numbers might have seemed clean at first glance, a closer look revealed murky waters beneath the surface, particularly in the company's tepid guidance for the year ahead. This triggered a wave of selling pressure, sending Whirlpool's stock into a downward spiral.

On the surface, things weren't so bad. Revenue ticked up slightly year-over-year, and earnings per share (EPS) met analyst expectations. Even amidst ongoing supply chain disruptions and inflationary headwinds, Whirlpool managed to keep its head above water. However, the calm quickly turned into a whirlpool of anxiety when the company unveiled its 2024 outlook.

Whirlpool's guidance painted a picture of sluggish growth, forecasting revenue to inch forward by a mere 2-3%, far below the 5-7% range that analysts had been anticipating. This significant underperformance raised red flags for investors, prompting several key concerns.

• The muted outlook cast a shadow over Whirlpool's ability to maintain its momentum. Investors, who had grown accustomed to consistent growth, worried that the company might be losing its grip on a saturated market.
• Whirlpool also hinted at potential margin erosion due to rising raw material costs and persistent supply chain snarls. This raised fears of profitability taking a hit, further dampening investor sentiment.
• The housing market, a key driver of appliance sales, is showing signs of cooling. This, coupled with Whirlpool's own subdued growth projection, painted a worrying picture for the company's future demand.

In the coming weeks, investors will be keeping a close eye on Whirlpool's management for a clearer roadmap. They'll be looking for answers on how the company plans to navigate the choppy waters of rising costs, slowing demand, and a potentially softening housing market. Until then, Whirlpool's stock is likely to remain turbulent, reflecting the uncertainty swirling around the company's future performance.

Dutch electronics giant Philips (PHG) reported surprisingly strong results for its Q4 2023, but its stock is down significantly today. While the financial performance beat analyst expectations, a looming Food and Drug Administration (FDA) decision on a major product recall is casting a shadow of uncertainty over the company's future.

• PHG's Q4 revenue reached €5.06 billion, down only 1% year-over-year on a comparable basis, defying fears of a steeper decline due to ongoing supply chain disruptions. The company posted a profit from operations of €24 million, excluding charges related to the Respironics recall, showcasing progress towards its profitability goals.
• Diagnosis & Treatment, Philips' largest segment, saw sales climb 5% with particularly strong performance in Image Guided Therapy, indicating continued demand for its medical imaging technology.
• However, the positive Q4 report is overshadowed by the ongoing recall of millions of Philips Respironics sleep apnea and ventilators due to concerns about potential health risks from foam degradation. While the company has reached a consent decree with the U.S. Department of Justice to resolve legal issues related to the recall, the financial and reputational impact remains significant.
• The FDA is still deciding on the scope of additional corrective actions Philips needs to take. A more stringent ruling could require expensive repairs or replacements, further straining the company's resources and potentially delaying the return of affected devices to the market.
• Investors are understandably nervous about the potential ramifications of the FDA decision. A worst-case scenario involving extensive repairs or device replacements could put a dent in Philips' profitability in the coming quarters. Additionally, the recall has already damaged the company's reputation, potentially impacting future sales and brand loyalty.

Analysts remain divided on the long-term impact of the recall. Some believe Philips can manage the situation effectively and emerge stronger in the long run, while others warn of potential headwinds. Until the FDA makes its final decision, the uncertainty surrounding the recall will likely continue to weigh on PHG's stock price.

In conclusion, while Philips' Q4 performance offers some reassurance about the company's underlying business health, the FDA decision on the Respironics recall remains a major wild card. Investors should closely monitor the regulatory developments in the coming weeks to assess the potential impact on Philips' future trajectory.

Intel (INTC) stumbled badly in its Q4 earnings report, sending shockwaves through the tech sector and triggering a significant sell-the-news reaction. While analysts might have predicted a tepid performance, the reality was even bleaker, leaving investors grappling with a mix of disappointment and concern.

• Intel missed on both revenue and earnings per share estimates. Revenue for the quarter reached $14.04 billion, falling short of the expected $14.51 billion, while EPS of $0.70 came in below the anticipated $0.73. Even worse, the company's free cash flow plunged from $8.3 billion in Q3 to just $700 million, raising serious questions about its financial health.
• The weak numbers were attributed to several factors. A slowdown in PC demand, particularly for consumer laptops, hampered the Client Computing Group. Additionally, server chip sales, previously a bright spot, showed signs of softening as data center expansions hit a pause. These pressures, coupled with rising material costs, squeezed margins, further darkening the already gloomy picture.
• But the real bombshell came in the form of Intel's lackluster guidance for 2024. The company expects full-year revenue to be flat to slightly down compared to 2023, with free cash flow hovering around $5 billion. This cautious outlook, a far cry from previous ambitious growth plans, dashed hopes of a swift turnaround and cemented the sense of disappointment among investors.
• Intel's woes extend beyond Q4 numbers. The company faces stiff competition from AMD (AMD) in the server chip market, and ARM (ARM)-based processors are steadily encroaching on the PC space. Moreover, internal delays in bringing new chipmaking technologies to market have further eroded confidence in Intel's ability to innovate and compete effectively.

Despite the pessimism, there are a few glimmers of hope. Intel's foundry ambitions, aimed at fabricating chips for other companies, hold potential for a lucrative new revenue stream. Additionally, the company's recent progress in AI and software could offer long-term growth opportunities.

Intel's Q4 earnings and weak guidance paint a concerning picture for the chip giant. Investors are left to ponder whether this is a temporary stumble or a sign of deeper structural issues. Intel's ability to navigate the competitive landscape, execute on its strategic plans, and deliver tangible results will be crucial in regaining investor confidence and steering the company towards a brighter future.

KLA Corporation (KLAC), the semiconductor equipment giant, released its December quarter earnings report today, and while the results themselves surpassed analyst expectations, investors' champagne corks remain uncorked. The stock, which hit an all-time high earlier in the day, is now down over 5% in after-hours trading, raising questions about the disconnect between headline numbers and market reaction.

• KLAC delivered on its financial promises. Revenue of $582.5 million topped estimates by $35 million, and adjusted EPS of $6.16 outpaced expectations by $0.24. These wins were driven by strong demand for KLAC's leading-edge semiconductor inspection and process control equipment, primarily used in the fabrication of advanced chips.
• However, it was KLAC's guidance for the upcoming quarter that threw a cold towel on the celebratory mood. The company predicted revenue to be flat to slightly up compared to Q2, with non-GAAP EPS remaining steady or increasing slightly. While these projections suggest continued stability, they fall short of the explosive growth many investors had hoped for, particularly after the all-time high stock price earlier in the day.
• Meanwhile, the global economic climate remains uncertain, with inflation and potential recessionary fears dampening investor appetite for even strong-performing tech stocks. Also, while demand for KLAC's equipment remains robust, chipmakers might be adjusting their inventories, leading to a temporary slowdown in new orders.

While KLAC's Q2 results were undeniably positive, mild guidance and concerns about the broader market climate triggered profit-taking after the stock's impressive run-up. This shouldn't erase the company's strong fundamentals or long-term potential, but it serves as a reminder that even solid earnings reports can be met with cautious optimism in uncertain times.