{"id":33516,"date":"2025-11-28T16:00:00","date_gmt":"2025-11-28T15:00:00","guid":{"rendered":"https:\/\/news.banquerichelieu.com\/?p=33516"},"modified":"2025-12-01T11:32:17","modified_gmt":"2025-12-01T10:32:17","slug":"weekly-radar-week-45","status":"publish","type":"post","link":"https:\/\/news.banquerichelieu.com\/en\/2025\/11\/28\/weekly-radar-week-45\/","title":{"rendered":"Weekly Radar – Week 45"},"content":{"rendered":"\n
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  1. American consumption<\/strong><\/li>\n\n\n\n
  2. The Duba\u00ef Airshow<\/strong><\/li>\n<\/ol>\n\n\n\n

    US EQUITIES<\/strong>
    Treasure Hunt Retail Drives American Consumption<\/strong><\/h2>\n\n\n\n
      \n
    • Burlington is the\u00a0smallest of the three major American off-price chains<\/strong>, behind Ross Stores and TJX. These stores mainly sell\u00a0surplus clothing stock<\/strong>\u00a0at prices around $10-15, representing\u00a0discounts of up to 60%<\/strong>\u00a0off the original price.<\/li>\n\n\n\n
    • On\u00a0November 25<\/strong>, Burlington’s\u00a0earnings report disappointed investors<\/strong>, contrasting with their\u00a0positive reactions<\/strong>\u00a0last week to the earnings reports from\u00a0TJX<\/strong>\u00a0and\u00a0Ross Stores<\/strong>. However, Burlington posted\u00a0revenue growth of +7%<\/strong>\u00a0and adjusted earnings per share\u00a0up by 16%.<\/strong><\/li>\n<\/ul>\n\n\n
      \n
      \"\"<\/figure><\/div>\n\n\n

      <\/p>\n\n\n\n

        \n
      • TJX pioneered the concept in 1956<\/strong>, followed by Ross in\u00a01982<\/strong>, and Burlington began focusing on retail in the\u00a02000s<\/strong>. These three stocks\u00a0dominate<\/strong>\u00a0the off price retail sector in the United States, and TJX and Ross have\u00a0outperformed many major retailers for several years<\/strong>.<\/li>\n<\/ul>\n\n\n\n

        Four factors explain this outperformance.<\/strong><\/p>\n\n\n\n

        o   The first is that all American households have seen their purchasing power squeezed since 2021<\/strong> due to sharp rises in prices<\/strong> and interest rates<\/strong>. These three retailers serve households across the income spectrum. The increase in tariffs<\/strong> partly explains the acceleration in same-store sales growth for Ross Stores and TJX in the second half of 2025 (>5%). This is undoubtedly the main factor<\/strong> that disappointed investors in Burlington’s results, with same-store sales growth of just 1%<\/strong> in the third quarter.<\/p>\n\n\n\n

        o   The second is that over the past 15 years, these three major retailers havegained market share<\/strong> against department stores and shopping malls, while also proving remarkably resilient to the growth of e-commerce<\/strong>. Americans are attached to this store concept: items turn over quickly, the thrill of getting a bargain is great, and the \u201ctreasure hunt\u201d game<\/strong>continues to work. TJX sums up the winning formula as follows: Brand, Fashion, Price, Quality<\/strong>.<\/p>\n\n\n\n

        o   The third is that their business model creates value for shareholders. These three chains generate operating margins that are several points higher<\/strong>than those of supermarkets, dollar stores, and department stores. Their distribution costs are lower<\/strong>, there are no backroom storage, e-commerce is non-existent, there are no marketing costs, the sector is highly concentrated, and customer loyalty is strong. Finally, these players benefit from the advantages of monopsony<\/strong> (one buyer facing several sellers).<\/p>\n\n\n\n

        o   Finally, their management is of high quality<\/strong>, particularly at TJX and Ross Stores, which significantly outperform Burlington. The latter has four former Ross Stores executives among its 5-member executive team.<\/p>\n\n\n\n

          \n
        • It is therefore a particularly\u00a0resilient niche sector<\/strong>, especially in periods of supply chain disruption, and which has gradually become\u00a0one of the pillars of American consumption<\/strong>.<\/li>\n<\/ul>\n\n\n\n

          <\/p>\n\n\n\n

          EUROPEAN EQUITIES<\/strong><\/strong>
          Key Takeaways from the Dubai Airshow<\/strong><\/h2>\n\n\n\n
            \n
          • Airshows remain an\u00a0exceptional showcase for industry players<\/strong>, and the 2025 Duba\u00ef edition was no exception, recording\u00a0all\u2011time highs in aircraft orders<\/strong>. A total of 414 purchase commitments were announced by Airbus, Boeing, and Embraer, well above the 325 at the 2025 Paris Air Show and far beyond the 189 at Farnborough in 2024.<\/li>\n\n\n\n
          • Airbus<\/strong>\u00a0was the\u00a0clear winner<\/strong>\u00a0of this Airshow with 232 commitments (32 firm) compared to Boeing\u2019s 175 commitments (100 firm), largely driven by Emirates\u2019 order for 65 Boeing 777X. By aircraft type, strong demand was fueled by large orders for narrow\u2011body and wide\u2011body jets.<\/li>\n\n\n\n
          • Airbus\u00a0continues to win new customers,<\/strong>\u00a0most notably with the symbolic gain of Flydubai, traditionally loyal to Boeing, which is making a strategic shift in its fleet. The airline signed a $24 billion MoU for 150 A321neo aircraft, with options for an additional 100 units.<\/li>\n\n\n\n
          • The\u00a0rise of Middle Eastern carriers<\/strong>\u00a0is undoubtedly the key takeaway from this Airshow: the region is a\u00a0strategic hub with massive long\u2011term demand expected<\/strong>\u00a0to account for\u00a020% of the global wide\u2011body market<\/strong>. Airbus forecasts more than 4,000 deliveries in the Middle East over the next 20 years, nearly half of which will be wide\u2011bodies (Emirates has just confirmed an additional order for eight A350\u2011900s).<\/li>\n<\/ul>\n\n\n\n

            <\/p>\n\n\n\n

              \n
            • The Airshow was also marked by the\u00a0first flight demonstration outside Asia<\/strong>\u00a0of\u00a0COMAC\u2019s<\/strong>\u00a0C919 (Commercial Aircraft Corporation of China). The C919, of which only 13 deliveries took place in 2024, is a narrow\u2011body aircraft competing directly with the Boeing 737 MAX and Airbus A320neo. COMAC\u2019s current strategy is to secure its domestic market (100% of deliveries to date have gone to Chinese airlines, whether for the C919 at the start of production or for its regional jet, the C909, already in service) before opening internationally in the medium term. The\u00a0historical duopoly<\/strong>\u00a0of the market (with Airbus holding more than 60% of estimated market share against Boeing) will gradually (2030\u201335?) evolve into anoligopoly<\/strong>, with\u00a0COMAC\u2019s market share expected to reach around 8% before 2045<\/strong>\u00a0compared to 1% today. COMAC also has\u00a0major ambitions for its wide\u2011body long\u2011haul aircraft<\/strong>, the C929 (designed to compete with the A350 and B787 Dreamliner); however, the Chinese group has had to postpone its first flight to 2029\u201330 (initially planned for 2025) due to technical delays and a reorganization following its split with its Russian partner.<\/li>\n\n\n\n
            • The level of orders at the Airshow clearly illustrates the\u00a0dynamism of the sector<\/strong>and the confidence of market operators, who are equipping themselves for the coming decades. It should be remembered that the\u00a0global civil aviation market is expected to double within 20 years<\/strong>.<\/li>\n\n\n\n
            • For\u00a0Airbus<\/strong>, 2025 was marked by supply chain bottlenecks, particularly for engines, which limited the production ramp\u2011up. As this limiting factor normalizes, the group\u2019s profitability should accelerate, supported by higher deliveries, a better mix of aircraft delivered (driven by the rise of the A321), and improved absorption of fixed costs.<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"

              US EQUITIESTreasure Hunt Retail Drives American Consumption Four factors explain this outperformance. o   The first is that all American households have seen their purchasing power squeezed since 2021 due to sharp rises in prices and interest rates. These three retailers serve households across the income spectrum. The increase in tariffs partly explains the acceleration in same-store sales growth for Ross Stores and TJX […]<\/p>\n","protected":false},"author":1,"featured_media":33515,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":"","_links_to":"","_links_to_target":""},"categories":[66],"tags":[],"class_list":{"0":"post-33516","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-macro-markets"},"acf":[],"_links":{"self":[{"href":"https:\/\/news.banquerichelieu.com\/en\/wp-json\/wp\/v2\/posts\/33516","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/news.banquerichelieu.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/news.banquerichelieu.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/news.banquerichelieu.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/news.banquerichelieu.com\/en\/wp-json\/wp\/v2\/comments?post=33516"}],"version-history":[{"count":1,"href":"https:\/\/news.banquerichelieu.com\/en\/wp-json\/wp\/v2\/posts\/33516\/revisions"}],"predecessor-version":[{"id":33520,"href":"https:\/\/news.banquerichelieu.com\/en\/wp-json\/wp\/v2\/posts\/33516\/revisions\/33520"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/news.banquerichelieu.com\/en\/wp-json\/wp\/v2\/media\/33515"}],"wp:attachment":[{"href":"https:\/\/news.banquerichelieu.com\/en\/wp-json\/wp\/v2\/media?parent=33516"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/news.banquerichelieu.com\/en\/wp-json\/wp\/v2\/categories?post=33516"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/news.banquerichelieu.com\/en\/wp-json\/wp\/v2\/tags?post=33516"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}