 Thanks now is Melissa Armo owner of the stock swoosh. Melissa it's great to see you. Thanks for joining us on Cheddar Business. Good morning. So take us through what you saw with this morning's earnings report. Let's start with the bad news. Well, it's all bad news. Everything's down. Home Depot looks pretty good. What did you say? Home Depot looks pretty good. Home Depot is down. Home Depot is collapsing. In fact it looked not so bad literally like about eight minutes ago. It was around 189 and it ended up opening. You literally turned away and looked at it. It's now at 18677 and falling. Stay with Home Depot. Why initially did it pop when we saw a couple elements of the earnings report beat mainly revenue and then earnings of course top and bottom line. Why are investors now reacting negatively? Well because ultimately they did. I guess they're blaming it on early bad weather at the beginning of the year that they did miss some in-store sales. Expectations. But overall Home Depot is a strong stock. So that a little bit of a negative reaction you saw this morning I thought could initially get bought. But all of a sudden it dropped a quick three points here and gapped down this morning and we're under the 200 period moving average. Now if you lift over that today this stock may recover. It's trying to recover right now. But overall even if we hold and drop today Home Depot is still a very strong stock. And this is one of the strongest retailers in the market. And if you look at right now what's happening in the housing market because interest rates have been on the rise. People are now going out and they're spending money to stay and fix things up in their current homes because people are not wanting to go out and buy new homes right now. Rates are going up. It's still about four and a half percent for a 30 year fixed mortgage. But that's a lot different than rates were five years ago even three years ago. Melissa I wonder if this is a bit of deja vu. Last week we saw Macy's come out with a better than expected earnings report before the bell. The stock was up about two percent and then it fell as the earnings call got underway and the CEO warned that tariffs would have an impact on its business. I think about Home Depot and the different materials that it's importing. Is this a company that could get caught in the crosshairs even more of this trade war. Absolutely. I think any retailer is going to get caught in this crosshairs especially if you're looking at the bargain places. The bargain places Target Walmart Home Depot Lowe's Macy's as well. Macy's is calling right now today too. These retailers is very interesting because in 2018 retail had a really strong start to the year which is unusual. Because again if you look at the total cost of the year most stores retail no matter what they are clothing brands or even the Walmart's of the world have big end of years because of Black Friday. So they make like all of their money at the end of the year. Now in 2018 that was not the case. Many of these stocks started the year strong last year. So we're talking a year and a half ago now we're into the end of May. They started the year strong and then they actually had a very strong total year for 2018. Now 2019 these stocks now are starting to drift off and Coles is a good example. I'm just going to flip over to that really quickly because Coles was was looking so amazing. Coles was one of the strongest retailers and people love the Coles. They have the Coles bucks, the Coles cash. This is another place that again is going to be affected with the tariffs. In November the stock may brand new all-time highs. Again we're looking at that holiday season with the sales. This gap down today in Coles is devastating for this stock. This stock is no longer in an uptrend after this gap down today. This stock closed last night over 60. In fact to give you the exact price it was 60, 62.91. And open today this is going to tank people. This opened today at 55.27. That is devastating for this stock. Now down 13 percent. Yeah, yeah. I'm curious what the Coles story is Melissa because the company had a couple of years of not missing analyst estimates at least for same-store sales. But in this latest quarter the company saw a miss in same-store sales, a miss on the top line, and a miss on the bottom line. What happened in the first quarter? Well, you know honestly they did miss. That's why it's down so huge. But you know all of these companies are competing against Amazon. You know not all of them are going to win out. I mean look at poor JCPenney. That's another one that's down this morning. JCPenney is soon going to be a penny stop which is very very sad. These stores and Coles is one of them are competing against the Amazons of the world. And the bigger Amazon gets the more people are going there the more products that Amazon is selling. They're not finding the reasons to go into the store. For Coles and Walmart and Target it's better people go into the retailer. Macy's too. If they get them in the store then they're going to buy. But how do you get people in the store? You can buy everything online and get delivery the same day. People don't feel like going in the stores anymore. And that's problematic for retail overall. This is a total retail overall. They're all competing against Amazon. It's like Amazon and the rest of the world. So true Melissa. But I think we're seeing even deeper reverberations today throughout the entire department store stock sector because these results from Coles are so disappointing. And I mean I think of Coles I think of the company among these stores that is making the biggest effort by a long shot to try to get customers back in the store to ramp up the experiential factor. Have these pop-ups. It's partnering with Amazon right. Trying to sell athletic apparel which we know millennials have traditionally liked. And so I wonder if the Coles story the fact that it is trying seemingly on the surface the hardest among all retailers and it's just not working is truly a sad story for the rest of the sector. It's not working and it is a sad story. And I think to be honest with you the only retailer that really can even compare or even compete with Amazon is Walmart. And I just looked today. I just scanned and looked at everything. Walmart even though it's dropping today did gap up this morning. Gapped up with the market this morning. It's falling right now. But Walmart is holding support on the 20 per move in average. Walmart had earnings just recently too last week. It fell on the earnings but it did gap up. Walmart is the only retailer that's big enough strong enough that around a long long time that can compete. And they are they are prepared I believe for the tariff war to continue. And not only that I wouldn't be surprised if the tariffs went on everything. I believe that's where this is heading. And they could even be more than 25 percent fast forward end of 2019. I want to move beyond even end of 2019 Melissa what is what does this landscape look like three five years from now. I mean who who's left standing. Well I mean it's so sad but I'm getting back I don't know if JC Penny someone's going to buy them if they're going to end up being the next years. You know I mean look at look at the stock today it didn't break a dollar yet but it's probably going to show I think some of these are either going to get bought up or they're going to go bankrupt. They just can't compete so you're not going to see all these companies but I really hope specifically because I live in New York City and I love shopping at Macy's. I hope some of these stores that are icons you have the Macy's Thanksgiving Day parade I hope some of these stores make it. I like shopping at Lord and Taylor and now it's going to be a we work so I know it's just the way the world was working right now. And look and you hear about Neema Marcus I love Neema Marcus they just have beautiful Neema Marcus down in Hudson Yards but they're doing an awful lot of sales too. We're sales and work gift parts and they've ever done before and that's concerning. When you look at it and you say well wait a minute are they struggling to because when they start discounts every week in order to get sales and that's problematic. Melissa Armo is the owner of the stocks who are sorry we are going to have to leave it there it is always great to have you join us. Thank you.