No one tell my kids it’s the long weekend. I’m trying to convince them they go to school on Monday in hopes they will sleep in. Contrary to what their parents want, weekdays are the only times they like to sleep past 7 a.m.
Here are five things to know this week:
Nvidia we trust: The most valuable public company in the world will report results Wednesday after the bell. The chip maker hit a record high last week before its stock was part of a broader market selloff, following the conclusion of U.S. President Donald Trump’s visit to China. Investors were disappointed the trip didn’t result in any purchases by China of Nvidia’s less powerful H200 chips. This may be the focus on Nvidia’s earnings call after it releases its results.
Aside from that, Nvidia NVDA-Q should be a beneficiary of the US$725-billion in capital expenditures announced by the hyperscalers. Sales are expected to grow 78 per cent from last year and profit expected to surge nearly 130 per cent. Not bad for a US$5.5-trillion company trading at 27x earnings. We could also see something unusual for a growth stock: a bigger push toward dividends and buybacks.
“Many investors we speak with are pushing for a much larger dividend commitment - which we think the market would like because it will further broaden the shareholder base,” wrote UBS analyst Timothy Arcuri. He says the setup is good for a post-quarter pop in shares. “We sense a marked apathy on this stock even among most big long-onlies – so the setup for a good set of numbers and potentially positive news on capital return is a good one …,” said Mr. Arcuri.
Piping: Inflation in Canada is poised to hit the highest level since December, 2023, when the data for April is released Tuesday morning. The culprit is obvious: Gas prices surged 21 per cent in March and another 8 per cent in April.
“That jump in headline inflation, and the prospect for some further pressure next month, is all the market needs to keep on pricing in strong odds of Bank of Canada rate hikes later this year,” wrote BMO Financial Group chief economist Douglas Porter. However, raising rates would be a mistake, argues Mr. Porter. “Our view is that the conditions are just not there to have core inflation erupt like they did four years ago, and that the oil price shock will not fan out to broader inflation,” he said.
Bargain hunting: Results from Walmart WMT-N and Target TGT-N this week will offer a window into how consumers are dealing with higher inflation. Walmart has been a beneficiary as consumers trade down but the street is bracing for a deceleration with same-store sales expected to grow less than 4 per cent for the first time in two years.
“Times like this is why you own the stock,” wrote Bank of America’s Christopher Nardone. “We expect the core Walmart consumer will prove resilient and think a prolonged period of macro volatility and higher gas prices can accelerate share gains as consumers hunt for value.”
Target is a different beast, more of a turnaround play. Shares have recovered 20 per cent in 2026 but are still down 54 per cent from the pandemic peak, compared to Walmart, which is near record highs. Same-store sales are only expected to grow 1.7 per cent, lower than Walmart, but would be the first positive print in a year. The results will also be a chance to hear from new chief executive Michael Fiddelke, who is only three months into the job. Target trades at just 14x earnings compared to Walmart’s 44x.
Turbulence: CAE Inc. CAE-T shares are trading at around the same levels as when activist investor Browning West swooped in 1½ years ago insisting it take part in the CEO search. Under their handpicked chief executive, the flight-simulation company has stabilized its defence business and increased cash flows. But now there are challenges in its civil business and the current war in Iran isn’t helping aviation sentiment. Recently, the company completed a review of which non-core assets to sell that could include the sale of its Flightscape business that it purchased in 2022.
“We are encouraged that the company is taking concrete actions to optimize its portfolio of businesses, to improve civil training margins and to drive better returns on capital and free cash flow generation,” wrote National Bank capital markets analyst Cameron Doerksen. He maintains a buy rating and says investors will look for details on the transformation plans and longer-term financial targets. CAE reports Thursday after the close.
Cracks in the foundation: Home Depot HD-N and Lowe’s LOW-N will be in focus this week as both stocks are under pressure. The U.S. housing recovery still hasn’t materialized and a spike in bond yields dashed any hopes it was around the corner. Home Depot is trading at the lowest level since 2023 while Lowe’s is at a 10-month low. Sales growth expectations are tepid with analysts predicting less than 1-per-cent growth at both home-improvement chains this quarter.
In the Money with Amber Kanwar is Canada’s top investing podcast. New episodes out Tuesday and Thursday. Subscribe now. www.inthemoneypod.com