20-Year Pro Trader Reveals His "MoneyLine"
Ditch your indicators and use the "MoneyLine". A simple line tells you when to buy and sell without the guesswork. It’s a line on a chart that’s helped Nic Chahine win 83% of his options buys. Here's how he does it.
Wedbush initiated coverage on three retailers, highlighting strong macro trends and business models that made it difficult for e-commerce rivals to replicate.
The Ratings
Wedbush analyst Jen Redding initiated coverage of Burlington Stores Inc (NYSE:BURL) at Outperform with a $175 price target.
Redding came out with Neutral ratings on both Ross Stores, Inc. (NASDAQ:ROST) and TJX Companies Inc (NYSE:TJX) with $90 and $100 price targets, respectively.
The Theses
There is “no end in sight in the run-up for off-price goods,” according to Redding, making the companies attractive growth stories.
There are three other key factors, in Redding’s view, supporting the discount retail sector:
- E-commerce can’t replace the experience of bargain hunting customers enjoy.
- E-commerce competitors must also replicate the diverse assortment of these three companies, requiring high sourcing and warehousing costs that make profitability difficult.
- A strong dollar and other positive macro trends in the U.S. should drive spending in the consumer discretionary category.
With these factors common across the sector, why withhold Buy ratings from Ross and TJX?
The analyst believes Ross is a solid investment for those looking long-term, but is fairly valued at its current level.
TJX’s financials are “solid,” with enough cash being generated to buy back $2.5 billion to $3 billion of outstanding shares annually. There is limited visibility into international prospects at the moment, however, and reading “favor[s] investments with an exclusive U.S. focus.”
Price Action
Burlington was down by 1 percent at $150.75 at time of publication. Ross and TJX shares were faring slightly better, both down 0.4 percent.
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20-Year Pro Trader Reveals His "MoneyLine"
Ditch your indicators and use the "MoneyLine". A simple line tells you when to buy and sell without the guesswork. It’s a line on a chart that’s helped Nic Chahine win 83% of his options buys. Here's how he does it.
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