U.S. Consumer Sentiment Hits All-Time Low Amid Inflation Concerns
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 45 minutes ago
0mins
Source: Fool
- Consumer Sentiment Plummets: The University of Michigan's latest consumer sentiment index reveals that U.S. consumer confidence has reached an all-time low, worse than during the 2007-2009 financial crisis and the early days of the COVID-19 pandemic, indicating a grim economic outlook.
- Inflationary Pressures Intensify: Despite the U.S. economy not being in recession, rising inflation due to post-COVID price surges and tariffs imposed by Trump has heightened consumer concerns about future inflation, particularly as oil prices soar due to conflicts in Iran, directly impacting daily expenses.
- Social Security COLA Forecast Increased: The Senior Citizens League estimates that the 2027 Social Security cost-of-living adjustment (COLA) will be 3.9%, marking the third-highest increase in 15 years, reflecting the ongoing trend of rising inflation.
- Retirees Face Challenges: While the COLA increase may help offset rising product prices, fixed-income retirees may still experience economic strain as costs for essentials like healthcare, housing, and insurance rise faster than overall economic prices, making the
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Analyst Views on PIPR
Wall Street analysts forecast PIPR stock price to rise
1 Analyst Rating
1 Buy
0 Hold
0 Sell
Moderate Buy
Current: 79.230
Low
386.00
Averages
386.00
High
386.00
Current: 79.230
Low
386.00
Averages
386.00
High
386.00
About PIPR
Piper Sandler Companies is an investment bank and institutional securities firm, serving corporations, private equity groups, public entities, non-profit entities, and institutional investors in the United States and internationally. The Company provides products and services, including financial advisory services; equity and debt capital markets products; public finance services; institutional brokerage services; fundamental equity and macro research services; fixed income services; and alternative asset management strategies. It offers equity and fixed income advisory and trade execution services for institutional investors, corporations, and government and non-profit entities. Its segment provides investment banking services, institutional sales and trading services for various equity and fixed income products, and research services. It operates alternative asset management funds in merchant banking and healthcare to invest firm capital and manage capital from outside investors.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
U.S. Consumer Sentiment Hits All-Time Low Amid Inflation Concerns
- Consumer Sentiment Plummets: The University of Michigan's latest consumer sentiment index reveals that U.S. consumer confidence has reached an all-time low, worse than during the 2007-2009 financial crisis and the early days of the COVID-19 pandemic, indicating a grim economic outlook.
- Inflationary Pressures Intensify: Despite the U.S. economy not being in recession, rising inflation due to post-COVID price surges and tariffs imposed by Trump has heightened consumer concerns about future inflation, particularly as oil prices soar due to conflicts in Iran, directly impacting daily expenses.
- Social Security COLA Forecast Increased: The Senior Citizens League estimates that the 2027 Social Security cost-of-living adjustment (COLA) will be 3.9%, marking the third-highest increase in 15 years, reflecting the ongoing trend of rising inflation.
- Retirees Face Challenges: While the COLA increase may help offset rising product prices, fixed-income retirees may still experience economic strain as costs for essentials like healthcare, housing, and insurance rise faster than overall economic prices, making the
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- Value Stock Recovery: The iShares Russell 1000 Value ETF (IWD) has risen over 48% in the past five years, while its growth counterpart, IWF, has nearly doubled, indicating a renewed investor interest in value stocks amid rising inflation, which may further boost their performance.
- Sector Performance Disparity: In 2023, the S&P 500 energy sector surged 30%, while healthcare fell 4.5%, consumer staples rose 10%, and materials increased by 9.5%, highlighting the growing appeal of cyclical value stocks, particularly in energy and consumer sectors under inflationary pressures.
- Economic Growth Expectations: Real GDP is projected to grow by 2.1% in 2025 and increase to 2.4% in 2026, with the Atlanta Fed forecasting growth above 4% in the second quarter, suggesting robust economic performance under inflation, which may further support value stocks.
- Rising Concentration in Tech Stocks: Despite inflation, tech stocks are experiencing a cyclical boom, particularly in semiconductors and AI infrastructure, with the S&P 500 rising about 5% since mid-April, indicating that investor concentration in tech may limit further upside due to associated risks.
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- Market Response: Despite higher interest rates, the S&P 500 rose on Wednesday, breaking a three-day losing streak, reflecting strong fundamentals, especially with Nvidia's AI-driven earnings expectations boosting market sentiment.
- Defensive Stock Recommendations: Piper Sandler identified Genuine Parts Company, which has a 78% correlation to the 10-year Treasury yield, suggesting it may outperform in a rising rate environment, particularly as consumers are more likely to repair rather than buy new vehicles.
- Consumer Goods Performance: Conagra Brands shows a 75% correlation to Treasury yields and may gain some market support in a high yield environment, despite facing margin compression and a nearly 40% drop from its 52-week highs due to rising commodity prices.
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- Net Interest Margin Improvement: The company expects its net interest margin to reach 3%-3.1%, up from the previous forecast of 2.85%-2.95%, which will enhance profitability and strengthen its competitive position in the financial sector.
- Analyst Price Target Increases: Following Schwab's positive outlook, three analysts raised their price targets, with Barclays increasing its target from $117 to $127, indicating strong market confidence in Schwab's future performance.
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U.S. Consumer Sentiment Hits All-Time Low Amid Inflation Concerns
- Consumer Sentiment Plummets: The University of Michigan's latest consumer sentiment index reveals that U.S. consumer confidence has reached an all-time low, worse than during the 2007-2009 financial crisis and the early days of the COVID-19 pandemic, indicating a grim economic outlook.
- Inflationary Pressures Intensify: Despite the U.S. economy not being in recession, rising inflation due to post-COVID price surges and tariffs imposed by Trump has heightened consumer concerns about future inflation, particularly as oil prices soar due to conflicts in Iran, directly impacting daily expenses.
- Social Security COLA Forecast Increased: The Senior Citizens League estimates that the 2027 Social Security cost-of-living adjustment (COLA) will be 3.9%, marking the third-highest increase in 15 years, reflecting the ongoing trend of rising inflation.
- Retirees Face Challenges: While the COLA increase may help offset rising product prices, fixed-income retirees may still experience economic strain as costs for essentials like healthcare, housing, and insurance rise faster than overall economic prices, making the
See More
Rising Inflation Drives Value Stocks Recovery
- Value Stock Recovery: The iShares Russell 1000 Value ETF (IWD) has risen over 48% in the past five years, while its growth counterpart, IWF, has nearly doubled, indicating a renewed investor interest in value stocks amid rising inflation, which may further boost their performance.
- Sector Performance Disparity: In 2023, the S&P 500 energy sector surged 30%, while healthcare fell 4.5%, consumer staples rose 10%, and materials increased by 9.5%, highlighting the growing appeal of cyclical value stocks, particularly in energy and consumer sectors under inflationary pressures.
- Economic Growth Expectations: Real GDP is projected to grow by 2.1% in 2025 and increase to 2.4% in 2026, with the Atlanta Fed forecasting growth above 4% in the second quarter, suggesting robust economic performance under inflation, which may further support value stocks.
- Rising Concentration in Tech Stocks: Despite inflation, tech stocks are experiencing a cyclical boom, particularly in semiconductors and AI infrastructure, with the S&P 500 rising about 5% since mid-April, indicating that investor concentration in tech may limit further upside due to associated risks.
See More
Investment Opportunities in High Yield Environment
- Rising Bond Yields: The U.S. 10-year Treasury yield is at 4.59%, with the 30-year yield at 5.12%, indicating increasing risks in the bond market that could pressure equities, particularly amid growing economic uncertainty.
- Market Response: Despite higher interest rates, the S&P 500 rose on Wednesday, breaking a three-day losing streak, reflecting strong fundamentals, especially with Nvidia's AI-driven earnings expectations boosting market sentiment.
- Defensive Stock Recommendations: Piper Sandler identified Genuine Parts Company, which has a 78% correlation to the 10-year Treasury yield, suggesting it may outperform in a rising rate environment, particularly as consumers are more likely to repair rather than buy new vehicles.
- Consumer Goods Performance: Conagra Brands shows a 75% correlation to Treasury yields and may gain some market support in a high yield environment, despite facing margin compression and a nearly 40% drop from its 52-week highs due to rising commodity prices.
See More
Charles Schwab Raises Guidance Amid Analyst Upgrades
- Guidance Upgrade: Charles Schwab raised its 2023 revenue growth forecast from 9.5%-10.5% to 14%-15% during its annual Investor Day, reflecting management's optimism about market conditions and boosting investor confidence.
- Net Interest Margin Improvement: The company expects its net interest margin to reach 3%-3.1%, up from the previous forecast of 2.85%-2.95%, which will enhance profitability and strengthen its competitive position in the financial sector.
- Analyst Price Target Increases: Following Schwab's positive outlook, three analysts raised their price targets, with Barclays increasing its target from $117 to $127, indicating strong market confidence in Schwab's future performance.
- Strong Market Performance: Schwab's stock rose nearly 2% following the analyst upgrades, reflecting investor recognition of the company's growth potential and highlighting its competitive advantages in a diversified business model.
See More
CF Bankshares Named Among 12 Best Micro-Cap Dividend Stocks to Buy Now
- Earnings Warning: Piper Sandler analyst Adam Kroll lowered the price target for CF Bankshares from $34 to $33.50 while maintaining an Overweight rating; however, a $0.5 million interest reversal due to an increase in non-performing loans impacted PPNR and EPS, indicating pressure on the company's profitability.
- Financial Performance: CF Bankshares reported mixed results in its latest earnings report, with an increase in non-core loans leading to a shortfall in earnings, although the company's turnaround since its 2012 recapitalization has been deemed 'impressive', short-term profitability remains a concern.
- Market Competitiveness: Piper Sandler highlighted that CF Bankshares has a stronger-than-peer organic balance sheet growth outlook, with expectations for modest net interest margin expansion that could support further profitability improvements, despite competitive pressures in the market.
- Investment Potential: While CF Bankshares shows investment potential, analysts believe that certain AI stocks offer greater upside potential and carry less downside risk, prompting investors to carefully consider market dynamics when making investment decisions.
See More
CRISPR Therapeutics Shows Promising Upside Potential
- Strong Stock Performance: CRISPR Therapeutics' shares have surged 56% over the past year, significantly outperforming the S&P 500's 30% gain, indicating robust market confidence in its growth prospects.
- Optimistic Analyst Targets: According to Yahoo! Finance, CRISPR's average price target is $82.55, suggesting nearly 51% upside from current levels, while Piper Sandler's analyst has set a target of $110, indicating the stock could potentially double in the next 12 months.
- Catalysts from Clinical Trials: The ongoing development of the anticoagulant CTX611 could yield crucial clinical trial data in the coming months, targeting a $20 billion market, and positive results could significantly boost the stock price.
- Market Expansion Potential: The Casgevy drug, developed in collaboration with Vertex Pharmaceuticals, has yet to generate significant sales despite its 2023 approval due to its complex administration and high cost; however, the recent request for approval for children aged 5 to 11 could greatly expand its market potential, with annual revenues expected to exceed $1 billion in the coming years.
See More
