A number of stocks fell in the afternoon session after a hotter-than-expected wholesale inflation report fueled concerns about slowing consumer spending. The market was rattled by a Labor Department report showing the Producer Price Index (PPI), a measure of wholesale inflation, jumped 0.9% in July, significantly exceeding economists' expectations of a 0.2% rise. This was the largest monthly increase since March 2022, reigniting worries that businesses will be forced to pass higher costs on to consumers, who are already showing signs of price sensitivity. This inflation data has fanned concerns that U.S. tariffs on imported goods could start to translate into higher prices for shoppers. The inflation report landed amid growing evidence of consumer caution, with recent reports highlighting that shoppers are cutting back on non-essential spending, seeking out sales, and trading down to cheaper brands.
A number of stocks jumped in the afternoon session after markets continued to rally amid growing investor optimism for a Federal Reserve interest rate cut in September. This optimism was spurred by a recent Consumer Price Index (CPI) report that did not show runaway inflation, increasing the perceived probability of a rate cut to over 90%. Lower interest rates are generally seen as a positive for the economy as they reduce borrowing costs for consumers, which can stimulate spending on non-essential goods. Consequently, investors bid up shares in the apparel, home furnishings, and automotive retail industries in anticipation of stronger consumer demand.
Retailers are evolving to meet the expectations of modern, tech-savvy shoppers. Still, demand can be volatile as the industry is exposed to the ups and downs of consumer spending.
This has stirred some uncertainty lately as retail stocks have tumbled by 2% over the past six months. This drawdown was discouraging since the S&P 500 returned 5.7%.
Small-cap stocks can be incredibly lucrative investments because their lack of analyst coverage leads to frequent mispricings.
However, these businesses (and their stock prices) often stay small because their subscale operations make it harder to expand their competitive moats.
A number of stocks fell in the morning session as the broader market tumbled in the morning session after a surprisingly weak U.S. jobs report and the announcement of new, widespread tariffs on imported goods. The U.S. economy added only 73,000 jobs in July, falling far short of the 109,000 forecast. Compounding the issue, job gains for May and June were revised down by a combined 258,000, signaling what some see as “increasing signs of fragility” in the labor market. Simultaneously, the White House announced new tariffs, ranging from 10% to 41%, on goods from 92 countries. This “double whammy” of negative news has intensified fears that ongoing trade wars are damaging the U.S. economy. The combination of a weaker labor market and new trade barriers has rattled investor confidence, fueling expectations that the Federal Reserve may be forced to cut interest rates to support the economy.
The low valuation multiples for value stocks provide a margin of safety that growth stocks rarely offer.
However, the challenge lies in determining whether these cheap assets are genuinely undervalued or simply on sale due to their potentially deteriorating business models.
Shares of used-car retailer America’s Car-Mart (NASDAQ:CRMT)
fell 3.4% in the morning session after the company announced a delay in filing its annual report and stated that its financial statements for the past two fiscal years should not be relied upon.
A number of stocks fell in the afternoon session after reports pointed to a broad-based weakening of consumer health, highlighted by rising loan delinquencies and falling spending intentions.
Market swings can be tough to stomach, and volatile stocks often experience exaggerated moves in both directions.
While many thrive during risk-on environments, many also struggle to maintain investor confidence when the ride gets bumpy.
Even if a company is profitable, it doesn’t always mean it’s a great investment.
Some struggle to maintain growth, face looming threats, or fail to reinvest wisely, limiting their future potential.
Wrapping up Q1 earnings, we look at the numbers and key takeaways for the automotive and marine retail stocks, including MarineMax (NYSE:HZO) and its peers.
As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q1. Today, we are looking at vehicle retailer stocks, starting with Lithia (NYSE:LAD).
The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how America's Car-Mart (NASDAQ:CRMT) and the rest of the vehicle retailer stocks fared in Q1.
Earnings results often indicate what direction a company will take in the months ahead. With Q1 behind us, let’s have a look at Camping World (NYSE:CWH) and its peers.
Let’s dig into the relative performance of OneWater (NASDAQ:ONEW) and its peers as we unravel the now-completed Q1 automotive and marine retail earnings season.
Used-car retailer America’s Car-Mart (NASDAQ:CRMT) reported revenue ahead of Wall Street’s expectations in Q1 CY2025, with sales up 1.9% year on year to $370.2 million. Its non-GAAP profit of $1.26 per share was 65.8% above analysts’ consensus estimates.
Used-car retailer America’s Car-Mart (NASDAQ:CRMT) beat Wall Street’s revenue expectations in Q1 CY2025, with sales up 1.9% year on year to $370.2 million. Its GAAP profit of $1.26 per share was 46.1% above analysts’ consensus estimates.
