In the Money: 5 Things to Know

Futures tank after jobs data, Aritzia posts strong sales, Delta soars, Tilray & Constellation fall

Recently conversations with my 5-year-old have left me wondering if I ever attended school in the first place. The questions. “Why are there only eight planets?” “Did God make the Earth?” “Why is there wind?” “How many sleeps until April 14^th?” Everyday is like being drop-kicked into a McKinsey interview. Like, does she want the answer or does she just want to know how I got there? Oh, and she wants to know where babies come from. “Mom and dad made you” isn’t cutting it. She’s my toughest interview yet.

Jobs day: Job growth in Canada and the US surprised to the upside this morning. In the US, we are seeing good-news-is-bad-news trade take hold. Canada added 90,900 new jobs in December, much higher than the 25,000 that was expected. The gains were in both the part-time and full-time categories while the unemployment rate fell to 6.7% from 6.8%. The public sector led the job growth once again (+40,000) but there were gains in private sector employment (+27,000) and self-employed (+23,7000). Despite the strength, the Canadian dollar dropped. This was due to the US dollar popping on strong jobs data south of the border. The US added 256,000 new jobs in December vs the expectation of 165,000. This is the strongest pace of job growth since March 2024. The unemployment rate went down to 3.9%. The better jobs data coupled with stronger inflation readings means that traders have now pushed out the next rate cut by the Federal Reserve to October. Yields are soaring and futures are tanking on this prospect. Buckle up, its going to be a bumpy day.

Aritzia girl: Keep an eye on shares of Aritzia this morning after the retailer reported stronger than expected quarterly results. Not only that, its forecast for sales was much stronger than anticipated. The stock has been on a tear recently up 115% in the past year. Comparable sales at Aritzia increased 6.6%, which was well ahead of 1.5% consensus expectations. Total sales increased 11%. Margins expanded. But the real star is the forecast for the next quarter which calls for revenue growth of 28-31%. “The magnitude of the Q4FY25 revenue boost should be enough to consolidate the recent gains and send the shares higher…” wrote Martin Landry of Stifel this morning. Meanwhile, a bit of a meaculpa from Raymond James this morning which downgraded the stock on valuation ahead of earnings. “We acknowledge that our decision to downgrade was premature in hindsight, beyond what we see from the shares on Friday, our messaging for investors is to remain opportunistic in looking for an entry point in the stock,” wrote Michael Glen of Raymond James.

B12 shot: Shares of Walgreens Boots Alliance are up 14% in the pre-market after earnings crushed expectations while sales advanced more than expected. While profit fell from last year, investors are breathing a sigh of relief after a very difficult year. The stock is languishing around the lowest level since the mid 1990s. That puts today’s pop into perspective. Expectations are incredibly low. The company cut the dividend last year, got a new CEO, closed 1,2000 stores, attempted to sell the Boots Alliance business and reportedly attempted to sell the whole company. Walgreens has been hit by lower reimbursements for drugs in its pharmacy business as well as lower retail sales as customers struggle with inflation. Maybe I am a glutton for punishment, but I see a stock that is down 63% in the past year, is in the midst of a turnaround that is showing some promising signs with the potential for a takeover. Having said that, this could have all the makings of a yield trap: low valuation, high dividend yield. Most analysts recommend you steer clear of the name with only 3 buys, 12 holds, 3 sells.

Clear skies: Delta Air Lines is up 8% in the pre-market after smashing earnings and sales expectations. Not only that, the company is forecasting stronger than expected sales and profit for the upcoming quarter. The CEO exclaimed that 2025 is poised to be the best financial year in its 100-year history. Its an all-clear signal after an incredible rally in some of these airline stocks. Delta is up 22% in the last three months, while American Airlines is up nearly 50%. Air Canada has been along for the ride with the stock up 25%.

Sober curious: Shares of Tilray are down 7% in the pre-market after losses widened in its most recent quarter. The cannabis producer has made some acquisitions in the beverage business but today announced they will be scaling back on some of its beer brands in order to cut costs. Still, sales from its beverage business rose from last year due to acquisitions while sales from its cannabis business fell. Constellation Brands is down 3.5% right now after disappointing results. The maker of Corona beer and Kim Crawford wine reporting lower earnings than expected, worst than expected beer growth, a worse than feared drop in wine & spirit sales, and cut its full-year forecast. Constellation Brands has been hit by tariff concerns, but I have to wonder if the trend toward sobriety and lower alcohol consumption is weighing on both of these companies.