It’s earnings season again. And things are shaping up the way you might expect given everything we’ve been dealing with.

Earlier this month, I reported on dismal earnings declines from JPMorgan Chase (JPM) and Morgan Stanley (MS). Both big banks shed major percentage points in their Q2 revenue reports.

Bank of America (BAC) also fell short of expectations. And Netflix (NFLX) and Tesla (TSLA) reported profit drops as well.

Yet investors don’t seem nearly as phased as they could be. In fact, after Tesla unveiled its particular earnings drop, the stock rallied nearly 10% the following day. Meanwhile, Netflix recovered 7.3% of its share price and Bank of America saw a 3.4% boost after its paltry profits were revealed.

The Wall Street Journal reports:

 “So far this reporting season, shares of companies in the S&P 500 that have missed Wall Street’s earnings expectations have slipped 0.1% on average in the two days before their report through the two days after, according to FactSet. That compares with the five-year average of a 2.4% decline.

 “With inflation at a four-decade high and the Federal Reserve in the midst of an aggressive campaign to raise interest rates to rein in rising prices, many investors say they had braced for a messy quarter. Companies across industries have pointed to higher input costs and waning consumer demand.”

I know I write a lot about consumer sentiment being the savior of our current economic condition. Now I have to add that investor optimism appears to be playing a role in keeping things on track.

Whether this continued growth is coming from equities firms or individuals, admittedly, isn’t clear yet. If the latter, remember that the pandemic left many Americans with excess income to spend on the stock market.

Or perhaps many investors assumed things were going to be even worse than they actually are. Maybe others are convinced we’ve finally hit the floor, and now is the best time to buy.

Whatever the case, the disparity between earnings and investor activity is yet another indication of an unbalanced economy.

As we look to the second half of this year, it’s going to be really interesting to watch how the market reacts to both earnings reports and interest rate increases from the Fed. 

More Non-REIT News to Know About 

One of America’s most iconic companies, Weber Inc. (WEBR), instantly brings to mind summer barbecues… the scent of smoke… and the taste of pure joy.

This Illinois-based grill manufacturer has reigned supreme in the grilling community for over 130 years. It boasts a product line that brings out the best in any barbecue.

Sadly though, its stock hasn’t been so hot in recent years. And yesterday, Weber’s share price shed another 19% after it announced that CEO Chris Scherzinger was out.

Effective immediately, he’ll be replaced by Chief Technology Officer Alan Matula for now. The company clearly wants to reshape management in hopes of improving supply-side pressures and win back general consumer confidence.

Specifically, non-executive board Chair Kelly Rainko said this:

 “We are taking decisive action to better position Weber to navigate historic macroeconomic challenges, including inflationary and supply chain pressures that are impacting consumer confidence, spending patterns, and margins. The management team is well positioned to guide Weber through this transitional period and execute a transformation of the company’s cost base.”

 And it will commence looking for a permanent replacement for Scherzinger immediately.

The World According to REITs 

Safehold (SAFE) is one of my favorites in terms of truly forward-thinking real estate investment trusts. This innovative investment firm has effectively reinvented the REIT model by allowing owners to unlock the value of the land beneath their buildings.

Recently, this ground-lease pioneer closed on a massive ground lease after acquiring Soleste Grand Central – a 360-unit multifamily asset in Miami, Florida. This $62.5 million deal marks the sixth such transaction between Safehold and Avanti Residential, which originally acquired the property.

“We are excited to expand our relationship with Avanti and pleased that our accretive ground lease capital has played a role in their impressive growth acquiring high-quality multifamily assets,” said Steve Wylder, executive vice president.

Right now, Safehold stock is sitting around $40.70, up 11% this month. Then again, it also recently increased its monthly dividend by 4.12%, making it a promising investment possibility.

Author’s Note: If you do determine this stock is right for you, make sure to purchase it at a smart entry point. Even the best of companies can burn you badly if you buy in at inflated prices.

More By This Author:

Peaks And Possibilities To Peer At
Amazon Wants To Ask What Ails You
More Real Estate Data to Digest – If You Can