Latest news with #PiperSandler
Yahoo
20 hours ago
- Business
- Yahoo
Wall Street's riding high on relief, not results: Strategist
Wall Street's recent rally could soon face a reckoning. "Stocks are up because we've priced out macro risks," Michael Kantrowitz, chief investment strategist at Piper Sandler, said on Yahoo Finance's Opening Bid. "If the earnings aren't good enough, there's a lot of downside risk." Kantrowitz said the absence of fear has powered the bull market instead of a surge in corporate results, and investors are already pricing in a soft landing before it's fully earned. The S&P 500 (^GSPC) has climbed over 8% in the past year, buoyed by falling inflation, rate-cut hopes, and fading recession fears. Kantrowitz, however, said there haven't necessarily been signals of stronger fundamentals. The disconnect may worsen if companies report middling results or offer guidance that names headwinds, such as tariffs. Tariffs appear to be gnawing at Procter & Gamble (PG) and Whirlpool (WHR). Both companies recently reported earnings that underscored the repercussions they face due to Trump's trade policy. Kantrowitz argued that companies experience international supply chain pressures differently. While some high-flying names have seen effortless growth, he advises against using the market as an indicator of whether risks like tariffs are being priced in. "The market may not be appearing to pay much respect to tariff risks," he said, even though negative surprises can arise from Trump's tariff deals. The path higher has been greased by unusually favorable financial conditions. Bond volatility is sitting at multiyear lows. Real energy prices remain tame. Credit spreads, a key gauge of corporate risk, have tightened to multidecade lows, Kantrowitz added. These factors may help explain why valuations are stretched and why they make the current moment more fragile, especially if interest rate expectations shift. "Valuations of the S&P 500 should be high relative to history," Kantrowitz said, noting that credit spread suggests that further P/E expansion is limited. "How much more PE expansion is possible? That's going to come down to the next several inflation reports and where interest rates go." The risks are that the market is currently pricing in too many rate cuts, and that sticky inflation or geopolitical shocks, like trade wars, force a repricing. If that happens, investors may "sell off" the most speculative names. In the near term, attention will remain on corporate guidance. Any sign of softening demand, margin pressure, or cost inflation could cause swift revaluations. But over the longer term, the market's fate may hinge on whether earnings actually catch up to the optimism or if Wall Street will be forced to reckon with results that don't support the hype. Francisco Velasquez is a Reporter at Yahoo Finance. He can be reached on LinkedIn and X, or via email at Click here for in-depth analysis of the latest stock market news and events moving stock prices Sign in to access your portfolio
Yahoo
20 hours ago
- Business
- Yahoo
Market's 'fuel' for further P/E expansion is 'nearing empty'
The S&P 500 (^GSPC) and Nasdaq Composite (^IXIC) are trading at record highs. Piper Sandler chief investment strategist Michael Kantrowitz outlines the risks that could stifle further price-to-earnings (P/E) ratio expansion. To watch more expert insights and analysis on the latest market action, check out more Opening Bid here. Michael, I want to get back over to you. Um, P P/E ratios for the S&P 500 um, trading at uh, record highs depending on how you want to look at things. How much longer do you think the market can continue to to trade higher? Um, because as we're talking about this morning, the earnings are are growing, but this is the market that is being driven more by momentum in terms of price. Yeah, valuations are high uh and I'll start by saying initially the valuation of the market, the S&P 500 should be high relative to history. You've got superior fundamentals, you've got, you know, really low real energy prices, bond volatility is sitting at a multi-year low and you know, there's not much concern around tariffs, recession, inflation or rates going higher. So both structurally and in the near term, that kind of makes sense. Uh, in terms of how much more P/E expansion is possible, I think that's going to come down to ultimately the the next several inflation reports and where interest rates go, and the risk in my opinion is that rates do grind higher, we get inflation numbers that are moderately higher reflecting tariffs, and the market has to price out as many rate cuts as it's currently pricing in over the next 12 months. Uh, that's likely to cause not only P/Es to at least stagnate, if not come uh contract a little bit, but it's also likely to cause I think a sell-off in some of the most speculative names that have gone up in the last three four months again on this macro relief trade. And one of the metrics I like to look at is corporate credit spreads and those are back to basically the lowest levels in the last several decades, so that kind of suggests that the fuel for P/E further P/E expansion is nearing empty. Related Videos AstraZeneca CFO talks tariffs & shifting focus to US market Nvidia's TSMC order, Eli Lilly & Novo Nordisk sink, JPMorgan & Apple card Royal Caribbean, Merck, FuboTV: Trending Tickers Market needs strong earnings & jobs data to maintain highs Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Bloomberg
2 days ago
- Business
- Bloomberg
Dollar Climbs Most Since May as Trade Jitters Ease
Wall Street kicked off a pivotal week with the dollar climbing the most since May as a tariff deal between President Donald Trump and the European Union bolstered hopes for an extension of a China trade truce. The start of a week that will set the tone for the rest of the year in markets saw a dollar gauge up almost 1%, extending its July rally. The euro slid the most in over two months. In the run-up to the Aug. 1 US tariff deadline, traders will go through a raft of key data from jobs to inflation and economic activity. The big event comes Wednesday, when the Federal Reserve is expected to keep rates unchanged. Then there's a string of big-tech earnings, with four megacaps worth a combined $11.3 trillion reporting results. Nancy Lazar, Chief Economist for Piper Sandler tells Bloomberg Businessweek that consumers spending is going through a soft patch going into the third quarter as businesses try to anticipate tariff cost increases. (Source: Bloomberg)
Yahoo
2 days ago
- Business
- Yahoo
Piper Sandler Lifts Civitas Resources (CIVI) PT to $57, Maintains Overweight Rating
Civitas Resources Inc. (NYSE:CIVI) is one of the most undervalued stocks to buy and hold for 3 years. On July 17, Piper Sandler increased the price target for Civitas Resources from $54 to $57, while maintaining an Overweight rating. The firm noted that the exploration and production investment environment remains challenging post-Q2. This is due to fluctuating oil prices. Simultaneously, strong secular demand trends for natural gas are counteracted by high supplies and inventory builds. Despite these challenges, the long-term outlook for natural gas demand is positive. The sentiment was reinforced by the recent PA Power and Innovation Summit, which saw the announcement of $90 billion in investments for power and data center infrastructure. An industrial facility emitting natural gas from large pipes, with workers in the foreground. In Q1 2025, the company announced a $150 million reduction in capital expenditure compared to 2024. The company also implemented a cost optimization and efficiency plan targeting an incremental $100 million in annual free cash flow, with ~40% of this benefiting H2 2025. An oil gathering agreement is expected to contribute an additional $15 million annually to free cash flow. Civitas Resources Inc. (NYSE:CIVI) is an exploration and production company that focuses on the acquisition, development, and production of crude oil and associated liquids-rich natural gas. While we acknowledge the potential of CIVI as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the . READ NEXT: and . Disclosure: None. This article is originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
- Yahoo
Piper Sandler Reduces PT on The Campbell's Company (CPB) Stock
The Campbell's Company (NASDAQ:CPB) is one of the Best Mid Cap FMCG Stocks to Buy Now. Piper Sandler reduced the price objective on the company's stock to $35 from $41, while keeping an 'Overweight' rating on the shares, as reported by The Fly. The firm has updated its estimates for 2026 headwinds, mainly tariffs, which could impact the EPS. However, the firm believes that M&B (Meals & Beverages)'s sustainable momentum is expected to continue in 2026, but The Campbell's Company (NASDAQ:CPB) also has tough comparable sales. A woman preparing a meal using packaged foods with V8 juices and the other products of the company in the background. The Campbell's Company (NASDAQ:CPB) delivered strong Q3 2025 results, which surpassed expectations, partially because of favorable shipment timing. In Meals & Beverages, the company continues to see improvement in consumption throughout all consumer income groups. In Snacks, there was a mixed performance across the portfolio. While The Campbell's Company (NASDAQ:CPB) is benefiting from some robust innovation launches, it continues to adjust its plans to ensure competitiveness across the full brand portfolio. Overall, its performance showcased healthy execution and disciplined cost management. As of the end of Q3 2025, The Campbell's Company (NASDAQ:CPB) delivered ~$110 million of savings under the $250 million cost savings program, which was announced in September 2024. The Campbell's Company (NASDAQ:CPB) manufactures and markets food and beverage products. While we acknowledge the potential of CPB as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: 13 Cheap AI Stocks to Buy According to Analysts and 11 Unstoppable Growth Stocks to Invest in Now Disclosure: None. This article is originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
