In the Money: 5 Things to Know

Stocks lower, Lennar's results good enough, solar stocks crushed, Dynamite beats, notable calls

Update on my husband’s knee “pop” – everything is basically fine according to the MRI. I get a little flack for being so dismissive, but to be fair, most of the time I am right that nothing is wrong. Except for that one time I told him to drink a chamomile and go to sleep when he complained of a tummy ache. Turns out he needed an emergency appendectomy. He’s been cashing that check for the last 10 years.

In this episode of In the Money with Amber Kanwar, CI Global Asset Management’s Peter Hofstra shares why he believes the worst of tech sector volatility is behind us and why he remains optimistic on AI. He points to strong and steady spending in the space as a sign that fundamentals are intact, even as market sentiment swings. While he uses puts to manage risk when valuations run high, Hofstra makes it clear: right now, he sees more opportunity than downside. You can listen on Apple, Spotify or here.

Trumpxit: Futures are lower after US President Donald Trump cut his G7 visit short dashing hopes to breakthroughs on trade. However, Prime Minister Mark Carney said that Canada and the US are still aiming for a trade deal within 30 days. Trump left due to tensions in the Middle East with Trump calling for the evacuation of Tehran. This morning we got a read of retail sales in the US that showed a big drop. Retail sales in May dropped 0.9%, the biggest decline this year. This is our first indication that tariffs weighed on spending and could be offering some clues as to why inflation is being held in check despite tariffs. Spending on restaurants and bars fell by the most since 2023. The Federal Reserve is beginning it’s two day deliberation on interest rates. They are widely expected to keep rates on hold for a fourth meeting in a row and today’s softer retail sales is unlikely to alter that trajectory.

If you build it: Results from homebuilder Lennar appear good enough for investors with the stock up a modest 2%. Profit and it’s new orders forecast missed expectations but this was offset by better than feared margins. The housing market has slowed to a crawl in the US and homebuilders like Lennar haven’t been immune. The results certainly don’t point to a recovery any time soon but with the stock down nearly 25% over the past year, it appears the worst is already priced in.

Solar eclipse: Solar stocks are plunging across the board after the Senate in the US released a bill that would end incentives for wind and solar sooner than expected. Senate Republicans put forth a new version of the bill that would end wind and solar tax credits in 2028 whereas credits for nuclear, hydro power, geothermal would end in 2036. Shares of Sunrun (-36%), First Solar (17%), Enphase (21%) and SolarEdge (-32%) are all down sharply.

Retail diaries: Keep on eye on shares of Groupe Dynamite after sales and profit came in well above expectations. Same-store sales grew a whopping 13% while profit came in 20% above expectations. RBC’s Irene Nattel says the results show the retailer is starting their fiscal year with a bang. “Strong and better-than-expected Q1 (results) put (Groupe Dynamite) in pole position to meet/exceed prior and modestly revised F25 guidance, supportive of our Outperform rating,” wrote Nattel. Dynamite went public in November at $21/share. The stock has spent most of it’s life below that level, but if results continue to buck the soft consumer trend they may find their way back.

Notable calls: Gold may be in the late innings of a last hurrah according to the global commodity team at Citi. Gold is trading near record highs but Citi thinks demand has peaked and expects gold to drop to $2,500-$2,700/oz by next year. To underline the point on gold demand peaking, Citi points out that the percent of GDP spent on gold is the highest in 50 years (at 0.5%). Raymond James is downgrading Nutrien after a big rally. Shares of Nutrien are up more than 40% so far this year and Raymond James’ Steven Hansen says it is time to cash out. “…The recent retreat in corn prices from their Feb-25 highs (-13.6%) represents a clear decoupling vs. (Nutrien’s) outstanding share performance over the same time period (+18.2%), a dynamic that’s rarely proven sustainable,” he wrote in the downgrade. Gibson Energy is being downgraded at TD Cowen after a 20% rally from the April low. “We believe our positive thesis on this name following the Q4/24 weakness has played out, with growth opportunities presented appearing longer-dated in the context of current market conditions,” wrote Aaron MacNeil of TD Cowen. He also points out that leverage is elevated and that might affect future dividend increases.

Send in your questions for Brian Belski! Email questions@inthemoneypod.com

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