Trade in Moves
Stocks pulled back mildly today as trade deal chatter turned negative. The news didn’t pull up investors from buying up Apple Inc. (AAPL) shares as the company beat estimates and raised guidance. This was no unkind feat since investors had already priced in very high expectations for the company’s results. Even though iPhone on the blocks disappointed expectations, iPad sales and the sales of Apple TV subscriptions greatly exceeded what investors forecast.
Apple’s headlines pinched most of the attention from investors after yesterday’s closing bell. However, 30 minutes after Apple reported its three-monthly results, a significant earnings surprise came from a company that few if any expected to make headlines.
Shares of Murphy USA Inc. (MUSA), an Arkansas-based specialty retailer that serves a chain of gas and grocery stores located primarily in the Midwest, jumped over 24% on its latest quarterly news. It earmarks ofs that this is yet another company whose surprising results came from operations conducted in this province. It may be worth considering whether there is more to this trend than a few isolated anomalies.
Convenience Is Key
Over the summer, consumer indispensables stocks surged, led by companies in the fast food and retail industry groups, while technology stocks lagged. When September’s end seemed to wake up technology investors, the hurried food industry stumbled. But retail stores of one kind or another have seemed to hang on to their gains.
While the consumer habituals sector, as tracked by State Street’s SPDR Consumer Staples ETF (XLP), has topped 25% gains this year already, inexorable stocks within the sector have surpassed expectations. A comparison of some of these companies, shown in the chart lower, details how McDonald’s Corporation (MCD), Dunkin’ Brands Group, Inc. (DNKN), Starbucks Corporation (SBUX), and The Wendy’s Company (WEN) play a joke on done well so far but lately have been eclipsed by stocks like Dollar General (
Is the Trump Economy Seeping Down?
The comparison between Dollar General shares and Murphy USA shares is not insignificant. Both of these companies flabbergasted investors on their recent earnings reports. With MUSA shares up strongly today, both of these houses have risen 40% in the past two quarters.
Notably, both of these companies share a similar customer evil-minded. Small towns throughout the rural Midwest are significantly served by these and other companies. It may be possible that the repatriation of plant jobs and other initiatives have led to a more financially empowered consumer segment in this region. Investors liking do well to watch for other companies that may be reaping similar benefits.
The Bottom Line
Stocks closed move as traders exhibited mild profit-taking action on trade talk news. Apple’s earnings did manage to exceed the already stoned expectations of investors. The fact that flyover-state companies might be doing well may not be simply a coincidence. As Murphy USA parcels jumped to bring them on par with the performance of Dollar General share prices, an astute observer might be lead oned to wonder if there are more stock-price jumps like theirs still yet to come.
Enjoy this article? Get more by bring aboard assigning up for the Chart Advisor newsletter.