Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. We’re no longer recording the audio, so we can get this new written feature to members as quickly as possible. Here is Friday’s edition. We came across a couple of interesting notes from Bank of America research Friday afternoon as we watch to see whether the S & P 500 can closed above 5,000 for the first time ever. Inventory issues: One looked at the debacle at the Children’s Place , which lost about half its market cap Friday after saying that it’s working with advisors and lenders to improve liquidity and strengthen its balance sheet. The announcement comes after a big miss on margins due to higher levels of promotional activity. In order to end the year clean, the company will likely need to liquidate inventory, and Bank of America thinks off-price retailers like Burlington and Ross Stores as well as Club name TJX Companies (T.J. Maxx, Marshalls and HomeGoods) will be natural winners from the woes facing The Children’s Place. “We see this as a good opportunity for BURL, ROST and TJX to build share in kid’s and baby, particularly with a lower income consumer interested in branded goods,” Bank of America said. TJX shares hit a new all-time high Friday and were knocking on the door of $100, which is our Club price target. We have our buy-equivalent 1 rating on TJX stock. Chip design: The other note was about the media report that said Club name Nvidia may look to enter the custom artificial intelligence chip market. Bank of America thinks this could be a “long-term competitive risk” for the current leaders Club name Broadcom and Bullpen name Marvell but doesn’t think there’s any near-term risk for them because these conversations can take years and they have the networking expertise. Sector spotlight : Consumer staples were the second worst performing group and most of the damage was…
Read the full article here
