Yahoo Finance

This morning, we are watching Tesla, PVH, and Johnson & Johnson. First up, Tesla sales falling 37% in France last month, as the automaker faces a slowdown across Europe. Tesla delivered just over 3100 vehicles in France in February. Tesla sales have slowed across the continent due to several factors, among them a changeover to the new Model Y, as well as protest over CEO Elon Musk's role in President Trump's administration and his political leanings in Europe overall. Now, fire at a Tesla dealership in Rome on Monday destroyed 17 cars, and it's currently under investigation, just one of the many headwinds Tesla is facing right now. I do want to also point out that we have a note from Wells Fargo this morning. The analysts over there are seeing little immediate levers to pull to increase volumes, talking about earnings declines coming for Tesla, saying the company is going to need magic moving forward to be able to persist, talking about the EV credit pullback being a headwind, and also just disappointing fundamentals overall.

Right. So Tesla is now still down what, 40 plus percent since its record highs, where it was late last year. I think its actual record high might have been election day, if I'm not mistaken, or thereabouts. Um, and so you know, we've had a lot of folks come out and say that, as long as Elon Musk is dodging,

Yeah.

then there's not going to be a recovery for Tesla. And that's borne out in the action.

Yeah. It certainly is, and you continue to see that pressure. Though today, the stock is moving to the upside.

Yeah. I mean the other the other thing to consider is that there are a lot of Tesla apologists who have said that, once the new Model Y comes out that that will uh, spur a sales boost, that that's part of the reason why the sales have been down so much. So we'll find out when we get the numbers.

Certainly will. And just to mention as well, this is a day, today and tomorrow when we start to get the sales numbers and deliveries numbers from the automakers. Ford just came out with its numbers in the last few moments here. Um, in March, its retail sales were up 19%. And obviously, one of the questions we're going to be asking along with all the other cross-currents for this month is whether people were, you know, if you were weighing an auto purchase and you know that auto tariffs are going to be imposed, do you then rush that purchase? So that'll be interesting to see if that flows through the numbers. So Ford US March retail sales up 19%, first quarter US retail sales up 5%, although total sales in its first quarter down 1%. So obviously seeing strength in the US company for that.

Yeah. I guess one of the only times that a huge jump in sales could potentially be seen as negative news, just because we don't know if there will be a huge drop off moving forward off the back of that in the quarters to come here.

Yeah. All right. Next shares of Calvin Klein and Tommy Hilfiger parent, PVH, popping double digits in pre-market trading. That's after an earnings beat and a forecast for flat to slightly positive sales for 2025 came in above expectations. CEO Stefan Larsson citing a tough consumer backdrop in North America though, behind slowing sales in February. PVH was also blacklisted from China in February after an investigation last year into whether the company was boycotting certain types of Chinese cotton. But it looks like a lot of relief being expressed here about that forecast, especially since the shares were down something like 39% this year going into this report, which came out to the close yesterday.

I thought it was really interesting too, hearing a little bit more from the CEO about the consumer backdrop here, talking about how there is both a tough backdrop in China too, because of the consumer backdrop, but also because of some of the legal challenges they're having over there that you mentioned Julie. But also saying there's a tough consumer backdrop in the US. And I just thought it was interesting to hear him mention those two in the same sentence. Because we've been talking about the recessionary pressures in China for consumers, at least for so many years, and now to hear the US lumped into that same sentence feels like potentially a tough backdrop here. Also, I wondered if the degree of the pop we saw in shares was investors kind of clinging to any company that has strong forward guidance in the consumer space amid such an uncertain environment. Um,

Yeah. I was checking out short interest for it too because I thought maybe that was something fueling it, but the short interest, it's not I mean, it's it's about 5.6% of float according to Bloomberg, which is not crazy. So maybe there's a little bit of a short squeeze effect, but it doesn't seem to be that pronounced here.

Really smart to check that. Great point.

It's one of my go-tos. Something to keep in mind. Very good.

All right. Well finally, we are also going to talk about shares of Johnson & Johnson, taking a hit after a bankruptcy judge did dismiss the company's third attempt to resolve personal injury cases, linking use of its talcum powder to cancer cases. Here with more on what this means for J&J. We've got Yahoo Finance's Anjalee Khemlani. Anjalee, third time, still did not work out for J&J at least.

Third time, not a charm for them. That is absolutely correct. And this is after changing not just the venue, but also the subsidiary that they were fighting this under. So what we saw was J&J basically take a hit as you can see, down a little bit close to 3% this morning, not too much considering that this is, you know, putting them back on an uncertainty path with what to do with this case. So at stake is about 8 to 10 billion dollars in that settlement. J&J is saying they're going to reverse about 7 billion dollars that was set aside for this case back into the company's coffers. This whole case, the total of the settlement, isn't too much of a hit financially for the company. It represents about 2% of the company's market cap. And so that's why the company isn't really, uh, you know, taking this uh, maybe with too much of a hit there. Um, it's important to note that at the core of this rejection, this time and previously in the New Jersey cases, the judge had said that, you know, bankruptcy wasn't the right path for the company because it wasn't in danger of actually being bankrupt. And so it was inappropriate to use that route. Here, now at the core of this argument is that the company achieved the necessary percentage of claimants in order to reach a settlement unfairly. So they needed about 75%. J&J said they have 83%. And the judge said, well, it's questionable how you got to that 83% and about half the cases don't really qualify. So that's where we saw the need for that rejection. Now, we've seen some, um, you know, notes from analysts talking about how this is really, um, like this is really not that big a deal for the company, but it does put them back on a path to uncertainty as you can see on your screen. So based on the judge saying that this is generally referred to as an improper voting process, that's what the company has to try and resolve. The company did say it is going to go back into the tort system. They said in a statement today, quote, "We prevailed in 16 of 17 ovarian cases tried in the last 11 years, and will devote our efforts to defeating the fake claims." The company has been pretty vocal about the idea that some of these claims aren't even valid. So that is where they're going back on it.

Interesting. So there's still more to come.

More to come. This is not the end of the story.

Doesn't sound like it. All right, thank you, Anj. Appreciate it.