Joe Terranova, chief market strategist at Vitrus Investment Partners, thought Target's report was interested. The grocery sections seem to be working, he said. He is concerned about their inventory, however, and said their bottom line is starting to wane.
Terranova had been guiding people from Target to shares of Walmart , but Edwards might have convinced him otherwise. Walmart's management is in "disarray," she said. There are several moving parts that you have to take into consideration, so she's not sure Walmart would outperform Target in the fourth quarter.
Walmart is a great company, it's tough to get excited about its stock, said Zach Karabell, president of RiverTwice Research. For the past five years, the stock traded between $45 and $55 a share, he noted. He owns Lowe's , but is not really happy with it and said the retail sector is "problematic at best."
The retail space is interesting, said Brian Kelly, founder of Kanundrum Capital. Companies that everyone thought would do well, like Home Depot , have disappointed. The home improvement store surprised the Street when it said sales were slow and the back half of the year was just OK. It seems consumers are only buying what they need, he said.
TRADING THE AG SPACE
Shares of Potash are trading higher as investors bet the fertilizer maker is worth a lot more than BHP Billiton is offering to pay for it.
Look outside of the pure fertilizer plays to join the rally in agriculture stocks, said Zach Karabell, president of RiverTwice Research. There is increased demand around the world for food production, so he recommends looking at Monsanto or DuPont .
This is more of a global food story rather than a fertilizer story, added Brian Kelly, founder of Kanundrum Capital. With a burgeoning middle class, farmers need to grow more with less, he said. At the same time, growing conditions are poor around the world. That benefits US wheat farmers, so he likes The Andersons .
Joe Terranova, chief market strategist at Vitrus Investment Partners, owns Potash. He continues to recommend the stock.
10 YEAR TREASURY BOND TO HIT 1%?
Investors continue to seek out safety for small returns in Treasurys, but could the 10 Year Treasury Note drop to 1%.
For twenty years, the 10 Year Treasury Note has been trending downward, said Brian Kelly, founder of Kanundrum Capital. This pattern has been fueled by the Baby Boomers, who seek more yield. But at the rate the yield on the 10 Year has been declining, Kelly said it could drop to 1%. The bond currently yields 2.5%.
Kelly had owned iShares Barclays 20+ Year Treasury Bond exchange-traded fund, but sold it. He doesn't plan on getting back in for the remainder of the year.
"I don't see any reason to loan the government money for 10 years at 2.5%," Kelly said. "There's much better places to play."
If you want a diversified portfolio of bonds, look at the iShares iBoxx High Yield Corporate Bond or the SPDR Barclays Capital High Yield Bond exchange-traded funds, said Patty Edwards, principal at Storehouse Partners, has a few options. She also mentioned a 4 Year bond from Citicorp that yields 3.67%.