TheStreet Pro Portfolio Podcast

AAP Podcast # 53 – Hot PPI Data, Earnings, and Market Seasonality with Bob Lang

We are back with a new AAP Podcast with lead portfolio manager Chris Versace joined by Bob Lang. It’s been a bit since our last podcast with Helene Meisler, and some is catching up to do, but as that is done the conversation quickly shifts gears to the market, the Fed, and the data driving it all. Bob comes out swinging, aiming the Fed’s updated economic projections for being too conservative, especially given the economic data that led the Atlanta Fed’s GDP Model to up its outlook for the September quarter.
That gives way to discussing inflation and wage pressures, something the team is watching closely, as well as the hotter-than-expected September Producer Price Index. The two discuss their concern the market may be too complacent when it comes to the aggregate data of late. It may give rise to yet another market re-think on what the Fed needs to do, and this could come in two different forms. The conversation ends by discussing market seasonality, which Bob sees as being favorable between mid-October and the Thanksgiving holidays, and the September quarter earnings. While discussing recently revised guidance from airline stocks, Levi Strauss (LEVI), and disappointing quarterly results from LVMH Moet Hennessey Louis Vuitton (LVMHF), we also explain why, as an investor, it’s important to know what you own.

AAP Podcast #52 – Chatting with Helene Meisler

On this edition of the AAP Podcast, Chris Versace is joined by AAP team member and the brains behind TheStreet’s Top Stocks newsletter, Helene Meisler.  The conversation spans how Helene got started on Wall Street and shifts to how she examines charts, including why she prefers to do so by hand. Helene also shares why she sees an extended period of “chop” ahead for the market, the oscillators she uses to gauge the markets, and how that factors into being a swing trader.
Companies mentioned during the conversation include ChargePoint (CHPT), Caterpillar (CAT), Meta Platforms (META), Colgate (CL), Bank of American (BAC), Morgan Stanley (MS), Ford Motor (F), UPS (UPS), several retailers and utilities as well. Closing out the conversation, Helene shares a piece of whip-smart advice that both investors and traders will want to hear.

AAP Podcast #51 - What’s Next for Monetary Policy, What to Watch for Consumer Spending, Apple Event Thoughts

On this week’s AAP Podcast, Chris Versace is joined by Todd Campbell, editor of TheStreet’s Smarts. Out of the gate, the two talk about inflation and the August Consumer Price Index report, both agreeing September and October data will now be a focal point for the market and investors. Todd shares his thoughts on potential seasonality in oil, while Chris weighs in on wages following the Teamsters-UPS (UPS) contract and similar negotiations between the UAW and the Detroit Three as well as pilots and airlines.
The conversation shifts to potential risks for consumer spending power as student debt repayments return in October. Todd shares concerns about the holiday shopping season, and Chris discusses his for travel and restaurant spending. The two wind up sharing their thoughts on Apple’s (AAPL) iPhone event offering who they think will benefit the most. If you listen carefully, you’ll learn who next week’s guest will be on the podcast, and trust us, it’s one you aren’t going to want to miss.

AAP Podcast #50 - The State of the Energy Market with Prairie Operating Co.

AAP lead portfolio manager Chris Versace discusses the state of the oil market with Edward Kovalik Chairman and CEO of Prairie Operating Co. (CRKR). Formed in 2023, Prairie has a rather unique business model in that it combines a fast-follower strategy without any leverage on the balance sheet, offering bottom-line profit leverage as Prairie scales its drilling operations. Ed shares his longer-term outlook on the energy market, one that is underpinned by underinvestment in capacity and could lead to a domestic supply crunch in the coming quarters. Arguably, Prairie is a new, built-from-the-ground-up energy company that doesn’t have the typical industry baggage and it benefits from Ed’s time as a merchant banker focused on the energy market.
Investors looking for small-cap energy companies may want to dig further into Prairie Operating Co., starting with its latest investor relations presentation. The company’s strategy speaks to the AAP portfolio’s position in the Energy Select Sector SPDR Fund (XLE), and while we like the Prairie’s flexible business model, the current market cap and trading volume will keep us on the sidelines. As the company moves from permitting to drilling later this year and into 2024, we’ll look to revisit it.

AAP Podcast #49: Potbelly – Love the Sandwiches and Cookies, Look at the Results

On this week’s AAP podcast, we delve into the quick-service restaurant business with Potbelly (PBPB) CEO Bob Wright. No stranger to the restaurant industry given his time at Wendy’s (WEN), Charley’s Philly Steaks, Checker’s Drive-In Restaurants, and Domino’s Pizza (DPZ), Wright entered Potbelly as President and CEO during a challenging time for the company in 2020. Flash forward to today and Potbelly is coming off reporting positive same-store comps for nine consecutive quarters, including +12.9% for its June quarter.
During the conversation with AAP’s Chris Versace, the two discuss why Wright came to Potbelly, steps taken to turn the company around, how, and why franchising provides an avenue for growth, food inflation, pricing, and much more. For those that have yet to sample the Potbelly menu, be sure to listen to several of Wright’s callouts, including the cookies and what he keeps in his refrigerator at home.
From an AAP portfolio perspective, Potbelly’s franchising strategy follows in the footsteps of McDonald’s (MCD) while its focus on fresh food is similar to Chipotle (CMG). We like the steps enacted by Wright and the team, especially the profitable and asset-lite model better known as franchising. The average daily trading volume and market cap for PBPB shares make them a tasty consideration for investors looking for small-cap stocks.

AAP Podcast # 48 – The 411 on REITS with David Holeman, CEO of Whitestone REIT

On this week’s AAP Podcast, Chris Versace is joined by David Holeman, CEO of Whitestone REIT (WSR), which focuses on open-air retail centers, primarily in the US Sunbelt. The conversation is an excellent primer for listeners about the REIT sector. It includes how REIT management thinks about their portfolio and tenant composition over time, the data they examine when choosing a location, and how they stagger their rental agreements.
 
Our takeaway from the conversation is that while Whitestone REIT may be a smaller REIT by size, its monthly dividend and focus on meeting the needs of its surrounding communities makes it a standout. From an AAP portfolio perspective, while we like the Whitestone story, the market cap and average trading volume are simply too small for us to consider, but folks that like small-cap, income-generating plays may want to dig further.
 
During the conversation with Versace, Holeman shares that after a few economic cycles during his time at Whitestone, he and the management team look to remain nimble while focusing on evolving consumer needs in and around Whitestone’s centers. This meant pivoting toward consumer services as e-commerce changed the landscape for traditional retailers. The conversation touches on two pillars of growth for Whitestone including continued expansion and the cycling of rental agreements that tend to include rate increases. Holeman shares the existing team could grow to more than 100 centers vs. the 56 it had exiting the recent June quarter. Given the interest rate environment, the expansion strategy is likely to favor buying and rehabbing existing centers in the near term.

AAP Podcast #47: The Fitch Downgrade, Key Levels for the S&P 500, Earnings Season and Labor Gains

On this week’s AAP Podcast, Chris Versace is joined by AAP team member Bob Lang and the two tackle the Fitch downgrade this week for the US’s credit rating that roiled stocks just as we enter a seasonally weak time for the market. Bob puts some context around Fitch’s downgrade comparing it to the last rating downgrade in 2011. With the S&P 500 breaking its 20-day moving average, the next level of support to watch is the 50-day moving average, which comes in near 4,350 for the S&P 500. Bob also tells listeners to watch for the market becoming oversold, something that has him watching the market oscillators.
The conversation between the two then pivots to the June quarter earnings season, which so far has gone pretty well. However, as yet we haven’t seen any material upward revisions for S&P 500 EPS in the back half of 2023 or 2024. Chris shares why he thinks this is important to gauge how much steam is left in the market, and by the end of this week, ~80% of the S&P 500 basket will have reported. Chris and Bob round out the conversation by discussing the recent rise in the 10-year Treasury yield back above 4%, and if that turns out to be a sustained move how it could be a headwind for stocks.  The end discussing the Teamsters-UPS (UPS) contract and what it could mean for Ford (F), General Motors (GM), and Stellantis (STLA) just as the UAW shares it is looking for double-digit pay rises and defined-benefit pensions for all workers. 

AAP Podcast #46 – The Fed Hikes Rates Again, What’s Next?

On the abbreviated AAP podcast episode, lead AAP portfolio manager Chris Versace shares his reaction to the Fed’s June policy statement that lifted the fed funds rate by another 25 basis points and comments on Fed Chair Powell’s press conference. As he and the AAP team suspected, Powell and the Fed trotted out the “data dependent” line, calling out there are a number of data points in the coming eight weeks that will influence the next policy decision. We also share the view that while the market is currently focused on when the Fed may stop hiking rates, we expect it will eventually turn its focus to when the Fed may deliver the first rate cut. Per Powell’s comment today, monetary policy will remain in restrictive territory for some time. In our view, it will be the data that tells us when the rate hiking cycle is over and when we could see that first rate cut. As we digest the data coming in the weeks and months ahead, we’ll continue to update our view for monetary policy as well as the economy, earnings, and other relevant inputs that shape our thoughts for the AAP portfolio.

AAP Podcast #45 – The CEO Take on Inflation, Economy, Housing and Chips

On this edition of the AAP Podcast, Chris Versace is joined by Dr. Jack Truong, former CEO of building products company James Hardie Industries (JHX), the North American CEO of appliance company Electrolux and a top C-Suite executive with 3M (MMM). We cover an array of topics with Jack sharing his insights on inflation, debt levels for the US and consumers, and why he sees a soft landing for the US economy. 
The conversation continues with why he is bullish on infrastructure spending for nonresidential construction and the reshoring of chip capacity. Jack also explains why appliances in our kitchens could be fodder for cyber-attacks, something that prompted the Biden administration to introduce a cybersecurity labeling program. From there we dig deep into the housing market, one that Jack views the new construction segment as having considerable legs ahead of it. We close out the conversation with Jack sharing his view on what to look for in a management team and some questions investors should ask them.

AAP Podcast #44 - AAP Podcast #44 –June CPI Progress, the Nasdaq 100 Rebalance, and the June Quarter Earnings Season Set Up

On this week’s episode of the AAP Podcast, AAP’s Chris Versace and Smarts editor Todd Campbell review the better-than-expected June Consumer Price Index (CPI) report but share why the road to the Fed’s 2% target may not be as immediate as some are hoping. Todd breaks down the upcoming special rebalance for the Nasdaq 100 (NDX), sharing the ins and outs as well as why investors shouldn’t attempt to game the rebalancing action.
The two then pivot to upcoming bank earnings from JPMorgan (JPM), Wells Fargo (WFC), and Citigroup (C), discussing the recent upward move in big bank EPS expectations and some of the reasons behind that. They also discuss what they will be focused on in those reports, and what signals they will be watching for both the economy and the consumer. Chris and Todd also share why they have some reservations about the consumer entering the December quarter, and why in the coming months they will both be watching real wage growth like a hawk.