CrowdStrike beat EPS and revenue estimates, provided positive guidance, and raised full-year guidance range. However, the stock took a hit, possibly due to unfounded concerns about ARR growth or the stock getting ahead of itself. The author sees CrowdStrike and competitor SentinelOne as well-positioned to continue capturing market share in the growing cybersecurity market. Growth rates are coming down, but this was largely expected and growth is better than previously thought. The fiscal Q1 2024 numbers look good or great relative to expectations, with ARR increasing 42% Y/Y to $2.73 billion. The company expects to return to net new ARR growth in the second half of fiscal 2024. Despite the decline, the author believes it is likely that the stock will recover in the following weeks.

Vital Energy has announced another acquisition, disproving market fears of running out of competitive drilling sites. The deal price for the new acquisition was about 2.5 times EBITDAX, implying an EBITDAX of about $151.2 million. Locations acquired are likely profitable at lower prices than WTI $50 reported by management. Management is using conservative methodology to back up the purchase using all cash, covering potential financial risk with conservative operating risk assumptions. Despite a decline in commodity prices, the company maintained cash flow due to its hedging program. Vital Energy plans to accelerate cash flow through a conservative strategy of accretive acquisitions using stock as needed to improve financial leverage risk. Market worries about management's ability to run the newly constituted company with multiple acquisitions, but some acquisitions have been running successfully for a couple of years. As long as management sticks with what it knows, chances of failure for this strategy are slim.

Iveco Group N.V. may benefit from potential mergers after analyzing the Asian truck merger between Mitsubishi Fuso Truck & Bus and Hino. FPT Industrial, the division that produces engines, transmissions, and axles, has been supplying engines to Mitsubishi Fuso for over 15 years, but there may be changes to the agreements in the long term. Iveco Group and Nikola Corporation concluded their partnership, with Iveco focusing on its regional market in Europe and Nikola focusing on the North American region's activities. Iveco saw double-digit revenue growth in Q1 2023 and revised its estimates upwards for the whole year. The company has revised its preliminary financial outlook for 2023, guiding consolidated adjusted EBIT up to between €510 and €550 million, with net revenues of industrial activities up from 3% to 5% compared to 2022. The author reaffirms their target price of €10 per share for Iveco, with downside risks included in their initiation of coverage.

Albemarle is undervalued with a fair value estimate of $350 per share and is a top pick for investing in a lithium price recovery driven by rising electric vehicle sales globally. Albemarle offers investors one of the best cost and risk profiles of any lithium producer and plans to expand its annual lithium production capacity from 200,000 metric tons in 2022 to 500,000-600,000 metric tons by 2030. Albemarle has top-tier lithium assets through its brine operations in Chile and spodumene hard-rock operations in Western Australia. The fair value estimate for Albemarle's shares is $350 per share, with the bulk of growth coming from lithium. In an upside scenario, the fair value estimate would be $600 per share. However, Albemarle faces high uncertainty due to volatile lithium prices, potential overproduction, and political risks in Chile. Management's former lithium pricing strategy hurt shareholder value, but the company has moved to a two-tier pricing system that closer reflects market dynamics. Distributions, specifically increasing dividends, are appropriate as dividends are forecasted to average around 30% of net income over the next five years. The CEO and board chair, J. Kent Masters, brings engineering and specialty chemical leadership experience to Albemarle. Price target of $350 (80% upside)

The author provides a detailed analysis of Academy Sports & Outdoors, evaluating its fundamental health and potential as an investment. The company has improved its profit margin over the years and has a share repurchase program to return value to shareholders. Its debt-to-equity ratio is slightly above the author's threshold, but most of the debt is in lease obligations, and the company has a history of reducing its debt. Academy Sports & Outdoors has a diverse range of suppliers and a successful private label brand portfolio that generates customer loyalty. The company is successful as an omnichannel retailer, with various strategies implemented to improve the customer experience. The author evaluates the management and provides a bull and bear case for the company. They value Academy Sports & Outdoors using a discounted cash flow model and come up with a buy price of $51, indicating significant upside potential. The author discloses that they own shares in the company and provides a disclaimer that the newsletter is for educational purposes only.

Macy's missed sales expectations in Q1 and reduced its 2023 outlook due to weather and economic issues. The company is struggling to stay relevant and faces challenges from ecommerce and other retailers. Macy's response to market changes, including its Polaris plan, may not bring in large numbers of new shoppers. Macy's shares are undervalued and offer a secure 5% dividend yield. To achieve higher margins, Macy's will need to upgrade its private-label offerings, improve store operations, and cut costs. However, Macy's lacks efficiency, customer service, and low prices, and has been slow to respond to competition. Macy's Backstage stores are mostly seen as a defensive move, and it is uncertain if they are additive or cannibalizing full-price apparel sales. Macy's sizable e-commerce business may be cannibalizing its physical store sales. Macy's faces increased competition from discount fashion retailers, outlet stores, and international fast fashion firms. Macy's may struggle to reduce operating expenses and may need to spend heavily on marketing to remain competitive. Macy's has significant debt, but it has paid down and replaced debt as its results have improved. Macy's has a fair record of returning cash to shareholders. The author forecasts that Macy's will generate an average of about $860 million per year in free cash flow to equity over the next decade and return an annual average of about $570 million to shareholders through dividend and stock buybacks. Macy's intends to invest more than 50% of its near-term capital expenditures into its e-commerce capabilities and supply chain, which the author views as a prudent shift in investment. Price target of $27 (+100% upside)

The author, who has experience in the grocery business, is bullish on Canadian Tire, a diversified retail conglomerate with successful operations in retail banners, financial services, and real estate. The company's retail division focuses on creating proprietary products under owned brands, which management projects will grow to 45% of total sales by 2025. Canadian Tire is investing in improving its omni-channel experience and has a successful customer loyalty program through its Triangle rewards program. The financial services division is a big part of the overall business, contributing about a third of net profit, and could be a long-term winner. Canadian Tire spun off most of its real estate into its own REIT, which is well-managed and consistently raises distribution. The company has solid long-term earnings growth and is currently trading at a bargain price. Canadian Tire has consistently repurchased shares, increased its dividend for 13 consecutive years, and has potential for dividend growth going forward. The author plans to hold the stock for a long time and believes there is a lot to like about Canadian Tire today.