Reitmans Ord Shs V.RET

Target CEO says the consumer remains resilient

[flamingogold]

Sorry for the bears who have been predicting economic destruction post covid. A recession will come eventually, but they've been wrong for 2 years now and will be wrong for the next year too.

“We see an incredibly resilient consumer in the face of high inflation and some of the other challenges they’ve been facing to manage their household budgets,” Cornell said on a media call."

https://www.theglobeandmail.com/business/international-business/article-target-raises-its-2024-profit-forecast-after-price-cuts-boost/

[Torontojay]

  As always flamingo, you are cherry picking the data. Ask Starbucks, McDonald's or Home Depot if the consumer is resilient.   

[flamingogold]

TJ, I could say you are cherry picking too. Starbucks has been mismanaged and why they just replaced their CEO. McDonalds got greedy and went too far with their pricing and why they introduced the $5 meal. Home Depot I will agree with you there, real estate is definitely stressed as well as the home improvement sector. But, real estate and renovations are big ticket items so not surprisingly to

[savyinvestor333]

What does Starbucks, McDonalds and Home Depot have in common with Reitman's?   Nothing I would say

[Torontojay]

What they all have in common is that they are part of consumer spending which is two thirds of gdp. Home Depot is a bellwether for the US economy much like Canadian Tire would be for Canada. Btw, the last time Home Depot reported y/y decline in sales was 2008 during the GFC. Not a good sign.   

[TheCount11]

Meh... Home Depot has really tough Covid comps.  Could have told you that 2 years ago.  Its tied to housing transactions.   Revenues and Operating Income compounded around 12% over L5Y.  Management has done a fantastic job for decades.

[Torontojay]

Yes and people no longer have money left for home renovations. The covid spending spree is over. The US recently announced they over estimated the number of jobs created by over 800k! Now it all makes sense. 

[TheCount11]

I don't find the "Americans no longer have money" story compelling.  Sure some no longer have money but others do.  Is someone burning the money?  People were sitting at home during covid and wanted to renovate their houses.  That pulled demand forward. I do find the "Young Canadians (20-35) have no money" story compelling.  Its by boomer design.&

[flamingogold]

20-35 yr olds may be struggling now with debt and out of reach real estate but ultimately they will be rewarded with the biggest wealth transfer in history over the next 2 decades.

[TheCount11]

I hear what you are saying but think the 35 - 45 group will see lions share over next 20 years. The 35 to 45 group will have, on average, have parents between 63 and 77. Average lifespan is 83. If it is still old people voting Government will continue with policies that favour them. All levels of government are plundering the most productive people in society which happen to be the young. 

[Lllennn]

If 80 sells 3 to 80 then 80 sells 100 to 100 is that Slamage before September?

[flamingogold]

Half the time I have no idea what you're saying.

[Lllennn]

Ok 80 sells a 100 to 9, but still I don't think I have ever seen anything like this on the stock market, it's like I sell at the bid and buy back at the ask and only trade a few imo

[flamingogold]

I'll agree the real estate sector is stressed. Low income consumers are stressed. Are there cracks? Yes. But, no "hurricane", as Jamie Dimon incorrectly called it, is about to hit. We just had a 10% correction where many of the bears were quick to start banging the recession/depression drum. But, this is not a 2008 moment. Not even close. Could we see another 10% - 15% selloff

[Torontojay]

I disagree Flamingo. In Canada the hard landing is happening right now.  I'm very surprised you don't even see it. It takes at least a year to announce a recession after all the revisions are in place. The unemployment rate is already 1.5% higher than its lows and it typically reaches an average of 3% from trough to peak. In other words, Canada is already halfway there. The Sahm rule

[flamingogold]

What I do "see" is a rolling recession. Some sectors, like commercial real estate, continue to feel pain. Some retailers are struggling and others are hitting it out of the park. You mentioned Reitmans being dead the other day. Reitmans is not the market but since you used a retailer as a metric, I like to use Costco. Costco is the best of the best. The Costco near me is a zoo... always.