Plug Power Inc. – Michmutters
Categories
US

Inflation could push Fed into August rate hike

CNBC’s Jim Cramer on Monday said the Federal Reserve could raise interest rates in August, before its next scheduled meeting in September, if this week’s economic data shows that inflation isn’t abating.

“The Fed is still in charge of this market. A week ago, it looked like they might ease up, but after Friday’s red-hot jobs number and the passage of the [Inflation Reduction Act]I’m worried they might lower the boom on us even before September comes,” he said.

“If both numbers are scorchers, we will get a surprise August meeting,” he predicted, referencing the consumer price index and producer price index data coming this week.

The Senate on Sunday passed the Inflation Reduction Act, a Democrat-backed package aimed at fighting climate change and extending health care coverage.

The legislation, among other provisions, allows Medicare to negotiate prices with drug companies and puts a 15% minimum tax on large corporations.

The July jobs report saw stronger-than-expected numbers last week, meaning the central bank could have to continue its path forward on raising interest rates aggressively.

“If I were Chairman Jay Powell … I’d be hard-pressed not to call a special Fed meeting this month to hit us with another 75-basis point rate hike,” Cramer said. A basis point equals 0.01 percentage point.

Investors are also looking to the University of Michigan’s consumer sentiment index this week to shed more light on how consumers are coping with inflation.

Cramer also previewed this week’s slate of earnings. All earnings and revenue estimates are courtesy of FactSet.

Tuesday: Emerson Electric, Ralph Lauren, Plug Power, Unity Software

Emerson Electric

  • Q3 2022 earnings release at 6:55 am ET; conference call at 9 am ET
  • Projected EPS: $1.29
  • Projected revenue: $5.10 billion

Cramer said he expects Emerson to perform well long term after selling its waste disposal business InSinkErator to Whirlpool, but is still curious about how the company is faring short term.

Ralph Lauren

  • Q1 2023 earnings release at 8 am ET; conference call at 9 am ET
  • Projected EPS: $1.71
  • Projected revenue: $1.40 billion

Though Ralph Lauren is a high-end store, it could still face the same inventory gluts that other retailers are dealing with, he said.

plug-power

  • Q2 2022 earnings release after the close; conference call at 4:30 pm ET
  • Projected loss: 21 cents per share
  • Projected revenue: $159 million

Plug Power will benefit from the Inflation Reduction Act because of the bill’s hydrogen tax credit, which could help the company become more than just a niche fuel cell producer, Cramer said.

UnitySoftware

  • Q2 2022 earnings release at 4:05 pm ET; conference call at 5 pm ET
  • Projected loss: 21 cents per share
  • Projected revenue: $300 million

Cramer predicted that the beaten-down stock could go even lower since Nvidia’s preliminary financial results on Monday revealed that gaming is weak.

Wednesday: CyberArk Software, Wendy’s, Disney, Dutch Bros

Cyber ​​Ark Software

  • Q2 2022 earnings release between 7:00-7:10 am ET; conference call at 8:30 am ET
  • Projected loss: 30 cents per share
  • Projected revenue: $138 million

The company should report great results since cybersecurity companies tend to be shielded from economic turbulence, Cramer said.

Wendy’s

  • Q2 2022 earnings release at 7 am ET; conference call at 8:30 am ET
  • Projected EPS: 22 cents
  • Projected revenue: $540 million

Cramer said he’s worried about how inflation could be hurting Wendy’s performance.

Disney

  • Q3 2022 earnings release at 4:05 pm ET; conference call at 4:30 pm ET
  • Projected EPS: 98 cents
  • Projected revenue: $20.99 billion

“It’s just too hated for me to believe it can stay down,” he said.

Dutch Bros.

  • Q2 2022 earnings release after the close; conference call at 5 pm ET
  • Projected EPS: 5 cents per share
  • Projected revenue: $182 million

The company is a beloved brand, but it’ll have to convince investors that its stock is worth buying, Cramer said.

Thursday: Warby Parker, Toast, Rivian

Warby Parker

  • Q2 2022 earnings release at 6:45 am ET; conference call at 8 am ET
  • Projected loss: 2 cents per share
  • Projected revenue: $150 million

“I bet, like other recent IPOs, it’s going to move up on the quarter,” Cramer said.

toast

  • Q2 2022 earnings release at 4:05 pm ET; conference call at 5 pm ET
  • Projected loss: 12 cents per share
  • Projected revenue: $651 million

He said that he’s surprised so many small companies like Toast are seeing their stocks go higher, even on no news — which suggests they never should have gone down so much in the first place.

Rivian

  • Q2 2022 earnings release at 4:10 pm ET; conference call at 5 pm ET
  • Projected loss: $1.63 per share
  • Projected revenue: $335 million

The electric vehicle maker will likely benefit from the Inflation Reduction Act due to the bill’s extension of income tax credits for consumers who purchase electric vehicles, Cramer said. I have added that he still prefers Tesla.

Disclosure: Cramer’s Charitable Trust owns shares of Disney.

.

Categories
US

Port of New York and New Jersey battles a shipping container pile-up

The Port of New York and New Jersey announced new tariffs on Tuesday related to empty containers and export volume in its battle to decrease container congestion. Both loaded and empty containers that are considered long-dwelling will be subject to a quarterly “container imbalance fee.” The tariff will be effective as of September 1, pending the mandatory federal 30-day notice.

The Port of New York and New Jersey is the largest port on the East Coast and the third-largest in the nation. Products that were recently processed through customs in July range from BMW motorcycles and dresses for David’s Bridal out of China, parts for Plug Power, a gas cooker for Tractor Supply, and a “12 Days of Beauty Box” for Target.

But just like other ports, the Port of New York and New Jersey has processed record volumes of import containers during the pandemic and has seen these import containers wait longer at the terminals. These containers have clogged land capacity and slowed down port productivity. As a result, more vessels wait at anchor.

Under the new tariff, ocean carriers who do not move empty containers out of the port will be charged $100 per container. The port’s new container export levels mandate that export volumes must equal or exceed 110% of an ocean carrier’s incoming container volume during the same period. If that benchmark is not met, the ocean carrier will be assessed a fee of $100 per container for failing to hit this benchmark. Both loaded and empty containers are included in the import container count. Rail volume is excluded.

Record cargo volume, excess containers

Surrounding land is also being used by the port to make room for the excess containers. The port created temporary storage for both empty containers and long-dwelling import containers in a 12-acre lot within the Port Newark and the Elizabeth-Port Authority Marine Terminal. The port is also in negotiations and researching additional areas that could be used for storage space.

“As we continue to manage record cargo volume and work with our tenants and port stakeholders for the removal of empty containers in a timely manner, we call on all industry stakeholders to find sustainable, long-term solutions to an industrywide problem affecting many US ports ,” said Port Authority Chairman Kevin O’Toole.

The decrease in productivity can be seen in the increased travel time of vessels. The increased anchorage times can be tracked in the vessel transit time from China to the Port of New York and New Jersey.

“The Port of New York and New Jersey is facing record import volumes, leading to empty containers accumulating in and around the port complex that are now affecting the regional supply chain that is already under stress from various sources across the country,” said Bethann Rooney , director of the Port Department at the Port Authority of New York and New Jersey. “We emphatically encourage ocean carriers to step up their efforts to evacuate empty containers quicker and at higher volumes to free up much needed capacity for arriving imports in order to keep commerce moving through the port and the region.”

European goods and German port stresses

East Coast ports like New York receive a lot of goods from Europe, where trade has been severely impacted by ongoing labor strife at both ports and rails. Exports bound for the United States are at least two months late.

Among the thousands of containers that were imported into the Port of New York and New Jersey in the month of July, according to a review of customs data using ImportGenius, there was wine from Spain, pasta, Prosecco and Giorgio Armani suits from Italy, and furniture from France.

Planet, a new contributor to the CNBC Supply Chain Heat Map, captured photos to show the impact of the rail strikes that have left a crush of containers at the rail terminals in Hamburg. Because of extensive cloud cover in July, the comparisons are between May 15, 2022 and June 11, 2022. The buildup of containers can clearly be seen. With the labor strife continuing, the number of containers has grown, according to logistics experts, and that is slowing down trade.

Hamburg rail terminal comparisons

Planet

“The rail situation in the Ports of Germany, especially in Hamburg, remains stressed and the congestion is increasing,” said Andreas Braun, Europe, Middle East, and Africa ocean product director of Crane Worldwide Logistics.

Rail operators constantly miss their normal delivery and pick up windows, and can still not deliver laden containers to the terminal earlier than seven days prior to loading. Due to the summer passenger schedule, container train operators have to give right of way to the increased amount of passenger trains, which additionally contributes to the delays.

“At least one week of delays is normal by now however, that can go up to two weeks and the constant threat that you miss the vessel,” Braun said.

The CNBC Supply Chain Heat Map data providers are artificial intelligence and predictive analytics company Everstream Analytics; global freight booking platform Freightos, creator of the Freightos Baltic Dry Index; logistics provider OL USA; supply chain intelligence platform FreightWaves; supply chain platform Blume Global; third-party logistics provider Orient Star Group; marine analytics firm MarineTraffic; maritime visibility data company Project44; maritime transport data company MDS Transmodal UK; ocean and air freight rate benchmarking and market analytics platform Xeneta; leading provider of research and analysis Sea-Intelligence ApS; Crane Worldwide Logistics; and air, DHL Global Forwarding; freight logistics provider Seko Logistics; and Planet, provider of global, daily satellite imagery and geospatial solutions.

.