Visible Alpha Consumer Services

Casino operators in Macau have been struggling from less visiting traffic due to tensions in Hong Kong, macro uncertainties, and tighter travel restrictions ahead of President Xi’s December visit for Macau’s 20^th handover anniversary. However, analysts believe upcoming infrastructure improvements and an expected easing of security measures following the year-end celebration will increase mass-market tourism and sales through 2020.

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Starbucks will be reporting fiscal 4Q17 earnings after market close on 11/2. As is usually the case, investors are laser-focused on Americas same store sales, where investors expect 3.4% for the quarter. Within that estimate, brokers expect the majority of the growth will be driven by ticket, as the company continues to work on its digital initiatives and membership rewards program.

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Costco reported 4Q17 earnings results on October 5th, and the stock reacted with an almost 9% decline in the following days. As we detailed in a prior blog post, bears remain concerned about Costco’s membership trends amid increased competition from Amazon and other grocery retailers. 4Q results supported some of these concerns as gross margin, membership growth, and membership renewal rates were below expectations.

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