Investing

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Company: International Money Express (IMXI)

Business: International Money Express is an omnichannel money remittance services company. IMXI offers money transfer services digitally through a network of agent retailers in the United States, Canada, Spain, Italy and Germany. It works through company-operated stores, its mobile application and the company’s websites. Its remittance services include a suite of ancillary financial processing solutions and payment services available in all 50 states in the United States, Puerto Rico and 13 provinces in Canada. It offers money remittance services to Latin America and the Caribbean countries, mainly Mexico and Guatemala. These services involve the movement of funds on behalf of an originating consumer for receipt by a designated beneficiary at a designated receiving location.
Stock Market Value: $601.9M ($18.46 per share)

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IMXI’s performance in 2024

Activist: Voss Capital

Percentage Ownership: 5.64%
Average Cost: $19.14
Activist Commentary: Voss is a Houston, Texas-based hedge fund focused on underfollowed special situations. They are not traditional activists but have used activism as a tool in the past.

What’s happening

Voss has engaged with the company’s board and management team regarding ways to maximize shareholder value, including a possible sale of the company in a take-private transaction.

Behind the scenes

International Money Express is a money remittance services provider which enables consumers to send money from the United States, Canada, Spain, Italy and Germany to Mexico, Guatemala and other countries in Latin America, Africa and Asia. The company provides its services through a network of authorized agents located in various unaffiliated retail establishments, 118 company-operated stores and digitally via an app and its website. IMXI serves more than 4 million clients every month and has a goal of connecting families across borders, ensuring financial services are accessible to those who need them most. The company has roughly 20% market share in the top five Latin America and the Caribbean (LAC) markets and has been continually seeking expansion into new markets. For example, IMXI has made recent acquisitions of La Nacional in 2022, which has a strong market position in remittances to the Dominican Republic and other LAC countries. The company also acquired I-Transfer in 2023, which established outbound remittances capabilities from Spain, Italy and Germany. It also snapped up a money services entity in the United Kingdom in 2024, which will give the company the opportunity to provide outbound remittances from the UK.

This is not an opportunistic activist engagement for Voss. The firm initially reported holding IMXI in its Q2 2021 13F filing when the company was trading around $15 per share and it has held the stock ever since. Now, on Sept. 5, 2024, Voss filed a 13D and reported 5.64% ownership at an average cost of $19.14 per share, purchasing shares as high as $20.09 in the past 60 days.
One of the things the firm states in its 13D is that it has engaged in communications with the board and management of IMXI regarding a potential sale of the company in a take-private transaction. Voss is not the only actively engaged shareholder in the stock calling for a sale. A day prior to Voss’s 13D, Breach Inlet Capital Management sent a public letter to the board of IMXI, urging them to pursue a review of strategic alternatives that includes a potential sale of the company. Breach Inlet asserts that, despite solid operating performance and increasing adjusted earnings before interest, taxes, depreciation and amortization by over 2.5-times since going public six years ago, the company remains undervalued by the public markets. IMXI trades at under 5-times the last 12 months’ adjusted EBITDA while its peer remittances service provider MoneyGram was acquired by private equity firm Madison Dearborn for approximately 8-times adjusted EBITDA last June. Breach Inlet thinks that IMXI should be valued at a premium to MoneyGram, not a material discount, but just an equal valuation would imply a roughly $30 per share price.
Global remittances service provision is a highly fragmented market with no single company commanding greater than 20% market share. Accordingly, there could be consolidation opportunities for IMXI with a strategic acquirer like Western Union, which also trades at a premium to IMXI. If IMXI stays independent, its growth plan of expansion into the digital and European markets would require heavy investment in people and resources, sacrificing short-term performance for long term growth. This is not the type of plan that plays well in the public markets. Instead, IMXI could be a great business to be acquired by a private equity firm that can help facilitate the company’s growth plan while shielding it from the public markets, which have failed to fully value the company. You do not need to be a genius to see the allure of a company like this to private equity: A private equity firm bought it in 2007 and another one again in 2017. 
This is not the first time Voss is advocating for a strategic review at a portfolio company. In its 13D on Benefytt Technologies, filed in December 2019 when the stock was trading at roughly $14 per share, Voss highlighted the strategic opportunities at Benefytt and the active M&A environment in the company’s space. Benefytt was acquired by Madison Dearborn Partners on Aug. 31, 2020 for $31 per share. Most recently, at Griffon, Voss called for a strategic review, which the company undertook and ultimately concluded, determining to stay independent. Despite this, Griffon was a highly successful activist campaign for Voss where the firm gained board seats and made a 139.21% return on its 13D versus 1.28% for the Russell 2000 over the same period.
We strongly believe that modern day shareholder activism is a strategy that greatly benefits shareholders. We believe the best type of shareholder activism involves activists who come in with a detailed, long-term plan to create value, with a board seat being a huge plus. The other side of the spectrum is shorter-term “sell the company” activism that is often great for the investor but shortchanges the long-term shareholder. In those situations, we like to see a longer-term “Plan A” with a sale as a last resort or a detailed analysis on why the company cannot or should not continue as a standalone public company. While Voss does not provide either of these, the firm does have a lot of credibility as a long-term investor (an owner since 2021) who has not been public with its recommendations to management until now. As such, we think Voss’s intentions here are honorable and it’s doing what it thinks is best for both short-term and long-term shareholders.
If the IMXI does not execute on a strategic plan, Voss will likely consider director nominations. While a proxy fight is not likely part of its current plan, the firm has been successful in gaining board representation in previous campaigns. Voss is not afraid to take a proxy fight to a vote. At Griffon, the firm ran a successful proxy fight, winning a board seat for one of its two director nominees at the 2022 annual meeting, and later settling for another board seat. There are two directors up for election at the 2025 annual meeting and the nomination window opens on Feb. 21, 2025. If it comes to a proxy fight there are multiple factors that could work in Voss’s favor, including the company’s depressed stock price. There have also been signs of shareholder discontent, including the roughly 31% withhold votes cast against lead independent director Michael Purcell at the 2024 annual meeting
Ken Squire is the founder and president of 13D Monitor, an institutional research service on shareholder activism, and the founder and portfolio manager of the 13D Activist Fund, a mutual fund that invests in a portfolio of activist 13D investments. More

The third-quarter estimated tax deadline for 2024 is Monday, Sept. 16, and you could incur a penalty if you don’t send a payment.
Estimated payments apply to earnings from self-employment, gig economy work, investment income and more.
You can avoid IRS penalties by sending 90% of 2024 taxes or 100% of your 2023 levies if your adjusted gross income is less than $150,000. You must meet these thresholds throughout the year.

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The third-quarter estimated tax deadline for 2024 is Monday, Sept. 16, and skipping a payment could trigger a penalty, according to the IRS.
Typically, you need estimated payments for any income without tax withholdings, such as earnings from self-employment, contract or gig economy work and investment or retirement income. 

Some filers also need estimated payments if they haven’t withheld enough taxes from a full-time or part-time job.  
Estimated payments can help avoid “refund disappointment or balance due shock,” said Mark Steber, chief tax information officer at Jackson Hewitt.
If you’re unsure, there’s a “general rule of thumb” for who should make a payment, the IRS outlined in a news release last week.   
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You should make estimated tax payments if you expect to owe at least $1,000 in taxes after subtracting your 2024 withholdings and tax credits or if you can’t meet so-called safe harbor rules, according to the IRS.

The safe harbor rules say you can avoid IRS penalties by paying at least 90% of your 2024 tax liability or 100% of 2023 taxes, whichever is smaller. You must meet these thresholds throughout the year.
That percentage jumps to 110% if your 2023 adjusted gross income was $150,000 or higher. You can find adjusted gross income on line 11 of Form 1040 from your 2023 tax return.

How to avoid a ‘timing penalty’

“Many taxpayers incorrectly assume that if they are within the safe harbor limits they won’t have a tax payment penalty,” said certified financial planner and enrolled agent Tricia Rosen, founder of Access Financial Planning in Newburyport, Massachusetts.
Even with a refund, you can still incur a “timing penalty,” because the IRS requires tax payments on your income as it’s earned, she said.
For 2024, the quarterly estimated tax deadlines are April 15, June 17, Sept. 16 and  Jan. 15, 2025. Missing these deadlines can trigger an interest-based penalty calculated with the current interest rate and amount that should have been paid, which compounds daily.
Taxpayers impacted by natural disasters in 17 states, Puerto Rico and the Virgin Islands may have extra time for third-quarter estimated payments, depending on their location, according to the IRS.    

The ‘easiest’ way to make tax payments

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The Federal Reserve is about to cut rates for the first time in four years.
For consumers strained by high borrowing costs, this policy shift is welcome news — although one rate cut won’t deliver immediate relief, experts say.
From credit cards to car loans and mortgages, here’s a breakdown of what to expect when the Fed starts trimming its benchmark.

Recent signs of cooling inflation are paving the way for the Federal Reserve to cut rates when it meets next week, which is welcome news for Americans struggling to keep up with the elevated cost of living and sky-high interest charges.
“Consumers should feel good about [an interest rate reduction] but it’s not going to deliver sizable immediate relief,” said Brett House, economics professor at Columbia Business School.

Inflation has been a persistent problem since the Covid-19 pandemic, when price increases soared to their highest levels in more than 40 years. The central bank responded with a series of interest rate hikes that took its benchmark rate to the highest level in decades.
The spike in interest rates caused most consumer borrowing costs to skyrocket, putting many households under pressure.
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“The cumulative progress on inflation — evidenced by the CPI now at 2.5% after having peaked at 9% in mid-2022 — has given the Federal Reserve the green light to begin cutting interest rates at next week’s meeting,” said Greg McBride, chief financial analyst at Bankrate.com, referring to the consumer price index, a broad measure of goods and services costs across the U.S. economy.
However, the impact from the first rate cut, expected to be a quarter percentage point, “is very minimal,” McBride said.

“What borrowers can be optimistic about is that we will see a series of rate cuts that cumulatively will have a meaningful impact on borrowing costs, but it will take time,” he said. “One rate cut is not going to be a panacea.”

Markets are pricing in a 100% probability that the Fed will start lowering rates when it meets Sept. 17-18, with the potential for more aggressive moves later in the year, according to the CME Group’s FedWatch measure.
That could bring the Fed’s benchmark federal funds rate from its current range, 5.25% to 5.50%, to below 4% by the end of 2025, according to some experts.
The federal funds rate, which the U.S. central bank sets, is the rate at which banks borrow and lend to one another overnight. Although that’s not the rate consumers pay, the Fed’s moves still affect the borrowing and savings rates they see every day.
Rates for everything from credit cards to car loans to mortgages will be affected once the Fed starts trimming its benchmark. Here’s a breakdown of what to expect:

Credit cards

Since most credit cards have a variable rate, there’s a direct connection to the Fed’s benchmark. In the wake of the rate hike cycle, the average credit card rate rose from 16.34% in March 2022 to more than 20% today — near an all-time high.
For those paying 20% interest — or more — on a revolving balance, annual percentage rates will start to come down when the Fed cuts rates. But even then they will only ease off extremely high levels, according to McBride.
“The Fed has to do a lot of rate cutting just to get to 19%, and that’s still significantly higher than where we were just three years ago,” McBride said.
The best move for those with credit card debt is to switch to a 0% balance transfer credit card and aggressively pay down the balance, he said. “Rates won’t fall fast enough to bail you out.”

Mortgage rates

While 15- and 30-year mortgage rates are fixed and mostly tied to Treasury yields and the economy, they are partly influenced by the Fed’s policy. Home loan rates have already started to fall, largely due to the prospect of a Fed-induced economic slowdown.
As of Sept. 11, the average rate for a 30-year, fixed-rate mortgage was around 6.3%, nearly a full percentage point drop from where rates stood in May, according to the Mortgage Bankers Association.
But even though mortgage rates are falling, home prices remain at or near record highs in many areas, according to Jacob Channel, senior economist at LendingTree.
“This cut isn’t going to totally reshape the economy, and it’s not going to make doing things like buying a house or paying off debt orders of magnitude easier,” he said.

Auto loans

“Auto loan rates will head lower, too, but you shouldn’t expect the blocking and tackling around car shopping to change anytime soon,” said Matt Schulz, chief credit analyst at LendingTree. 
The average rate on a five-year new car loan is now around 7.7%, according to Bankrate.
While anyone planning to finance a new car could benefit from lower rates to come, the Fed’s next move will not have any material effect on what you get, said Bankrate’s McBride. “Nobody is upgrading from a compact to an SUV on a quarter-point rate cut.” The quarter percentage point difference on a $35,000 loan is about $4 a month, he said.
Consumers would benefit more from improving their credit scores, which could pave the way to even better loan terms, McBride said.

Student loans

Federal student loan rates are also fixed, so most borrowers won’t be immediately affected by a rate cut. However, if you have a private loan, those loans may be fixed or have a variable rate tied to the T-bill or other rates, which means once the Fed starts cutting interest rates, the rates on those private student loans will come down as well.
Eventually, borrowers with existing variable-rate private student loans may also be able to refinance into a less expensive fixed-rate loan, according to higher education expert Mark Kantrowitz. 
However, refinancing a federal loan into a private student loan will forgo the safety nets that come with federal loans, he said, “such as deferments, forbearances, income-driven repayment and loan forgiveness and discharge options.” Additionally, extending the term of the loan means you ultimately will pay more interest on the balance.

Savings rates

While the central bank has no direct influence on deposit rates, the yields tend to be correlated to changes in the target federal funds rate.
As a result of the Fed’s string of rate hikes in recent years, top-yielding online savings account rates have made significant moves and are now paying well over 5%, with no minimum deposit, according to Bankrate’s McBride.
With rate cuts on the horizon, those “deposit rates will come down,” he said. “But the important thing is, what is your return relative to inflation — and that is the good news. You are still earning a return that’s ahead of inflation, as long as you have your money in the right place.”
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Traders work on the floor of the New York Stock Exchange during morning trading on September 04, 2024 in New York City. 
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Here’s what CNBC TV’s producers were watching as the S&P 500 posted a fourth winning day and what’s on the radar for the next session.

Benefits of the doubt during a big week for four major names

Jim Cramer and his “Mad Money” friends ran through a short list of his top-performing CEOs running companies whose stocks have recently hit a rough patch but are proving themselves with a big week.
Kroger’s Rodney McMullen tops the list. The CEO told CNBC’s Sara Eisen on Thursday that solid performance is being driven in part by operations at the store level and their connection with customers. Kroger is locked in a legal battle with the government over its proposed merger with Albertsons. McMullen also said he sees big changes in spending habits at the start of each month when customers have more money in their pockets — compared to the end of the month when they’re buying more store brands. He said he’s starting to see similar behavior in more middle-class customers. Kroger is up 5.6% in four days. The stock is 5.4% from the April high.
Amazon CEO Andy Jassy is on the list. Amazon is up 9% so far this week. The stock is 7% from the 52-week high hit in July.
Nvidia CEO Jensen Huang spoke with CNBC TV’s Megan Cassella exclusively in an interview right outside of the White House on Thursday. He said that “we’re at the beginning of a new industrial revolution” in addressing artificial intelligence. Nvidia is up about 16% this week. The stock remains 15% from the June 20 high.
Broadcom CEO Hock Tan is also on Cramer’s short list. The stock is up 20% in four days, and it’s 11% from the June 18 high.

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Broadcom’s performance over the past five days

The retail monitor

CNBC TV’s Steve Liesman will have exclusive data on the state of the retailers and the Great American consumer in the 7 a.m. Eastern hour.
The SPDR S&P Retail ETF (XRT) is down 4% in three months.
The VanEck Retail ETF (RTH) is up 3.4% in three months.
Walmart is tops on the list in those three months, up 20%. The stock is at a 52-week high.
Best Buy is up 13% in three months. The stock is 5.75% from the 52-week high.
Lowe’s is up 12% in three months. It is 4% from the March high.
At the bottom of the list: Walgreens, Dollar Tree and Bath & Body Works — all down roughly 40% in the past three months. Dollar General is down 33% in that period.

Intel’s board meeting

On Friday, CNBC TV’s Seema Mody will look at Intel’s board meeting, which took place this week, and what’s likely to be the next step for the chipmaker.
Intel is up 2.5% this week.
But it remains 62% from the 52-week high hit in late December. The stock is down 37% in three months.

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Intel’s performance in the past three months

What if Boeing machinists go on strike?

Phil LeBeau continues his reporting for CNBC TV on Friday.
Boeing is up 3.27% so far this week.
It’s been a tough September: The stock is down 6.3%, and it remains 39% off the December 52-week high.

Norfolk Southern’s new CEO More

With trillions in tax breaks scheduled to expire after 2025, lawmakers are debating policy priorities that could impact millions of families and small businesses.
“This will be a make-or-break moment for the federal budget and for America’s middle class,” Senate Finance Committee Chairman Ron Wyden, D-Ore., said on Thursday.
However, negotiations could be difficult amid growing concerns about the federal budget deficit, experts say.

Senate Finance Committee Chairman Ron Wyden, D-Ore., questions IRS Commissioner Charles Rettig at a Senate Finance Committee hearing.
Tom Williams | Pool | Reuters

With trillions in tax breaks scheduled to expire after 2025, lawmakers are debating policy priorities that could impact millions of families and small businesses.
Enacted by former President Donald Trump in 2017, the Tax Cuts and Jobs Act, or TCJA, made sweeping tax changes, including temporary provisions that will sunset after 2025 without action from Congress.

The law also permanently reduced the top corporate tax rate to 21%.
Some of the expiring TCJA provisions include lower federal income tax brackets, bigger standard deductions, a more generous child tax credit, higher gift and estate tax exemptions and a 20% tax break for pass-through businesses, among others.
“This will be a make-or-break moment for the federal budget and for America’s middle class,” Senate Finance Committee Chairman Ron Wyden, D-Ore., said in a prepared statement at a Senate hearing on Thursday.
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If temporary TCJA provisions expire after 2025, more than 60% of tax filers could face increased taxes, according to estimates from the Tax Foundation.

But with future control of the White House and Congress uncertain, it’s hard to predict which provisions, if any, will be extended among competing priorities.
In the meantime, lawmakers and organizations are voicing support for certain tax issues before the 2025 deadline.

Small business tax break is ‘crucial’

Many small businesses worry about the so-called qualified business income deduction, or QBI, which is worth up to 20% of eligible revenue, subject to limitations.
The temporary TCJA tax break applies to pass-through businesses, which report income at the individual level. Those may include sole proprietors, partnerships and S-corporations, along with some trusts and estates. 

Jeff Brabant, vice president of federal government relations for the National Federation of Independent Business, which represents about 300,000 small and independent businesses, stressed the importance of making the QBI deduction permanent.
“The creation of the 20% small business deduction has been crucial to the survival of small business owners,” he said at the Senate hearing on Thursday. 
“Since its passage, the small business economy has endured many issues, including a pandemic that closed many businesses for long periods, record inflation and a historically tight labor market,” he added.

Debate over the child tax credit

Another witness, Indivar Dutta-Gupta, a visiting fellow at Georgetown University and tax fellow at Roosevelt Institute, argued for the child tax credit expansion.   
“The child tax credit is one of the single most important ways that we can improve working families after-tax income,” Dutta-Gupta told Senate lawmakers on Thursday.
The American Rescue Plan in 2021 boosted the maximum child tax credit to $3,000 or $3,600 per child, up from $2,000, and sent monthly payments to families.
As a result, the child poverty rate fell to a historic low of 5.2% in 2021, largely due to the expansion, according to a Columbia University analysis. 
After pandemic relief expired, childhood poverty more than doubled in 2022, jumping to 12.4%, and then increased to 13.7% in 2023, the U.S. Census Bureau reported.

Concerns over the federal budget deficit

While lawmakers have outlined several priorities before TCJA extensions, negotiations will be difficult amid growing concerns over the federal budget deficit, experts say.
The federal government has already spent more than $1 trillion on interest for its $35.3 trillion national debt this year, the U.S. Department of the Treasury reported Thursday.
“The house is burning down and we’re arguing over the furniture,” Kent Smetters, a professor of business economics and public policy at the University of Pennsylvania’s Wharton School, told CNBC. More

Individuals who have pension income may see their Social Security benefits reduced.
Some Washington lawmakers are pushing to change that.
But experts say simply eliminating the rules — formally known as the government pension offset, or GPO, and windfall elimination provision, or WEP — may not make the program’s benefits fairer.

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Rare bipartisan momentum is growing in the House of Representatives to force a vote on a bill that would address a topic Congress typically avoids — Social Security.
The bill — the Social Security Fairness Act — would repeal two rules that reduce Social Security benefits for workers and spouses, widows and widowers who also receive pension income.

On Tuesday, Reps. Abigail Spanberger, D-Va., and Garret Graves, R-La., filed a discharge petition to force a vote on the bill on the House floor.
The petition currently has 172 signatures out of the 218 signatures required for a vote, including 25 Republicans, according to Spanberger’s office.
If brought to the House floor, the Social Security Fairness Act may pass, based on the 327 co-sponsors who are currently behind the proposal.
The Senate version of the bill, with 62 co-sponsors, also has broad support.
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National groups representing police, firefighters, teachers, postal workers and government employees on the federal, state, county and municipal level, have also backed the effort.
Despite the momentum, experts say pushing the bill into law will not be easy.
“There’s just a time constraint here, and both the Senate and the House have a lot of work to do before the end of the year,” said Emerson Sprick, associate director for the economic policy program at the Bipartisan Policy Center.
Moreover, simply eliminating the rules — formally known as the government pension offset, or GPO, and windfall elimination provision, or WEP — may not make the program’s benefits fairer, he said.
The WEP, in particular, is “deeply, incredibly misunderstood,” which contributes to calls to simply get rid of the rule, Sprick said.

How the WEP and GPO work

The windfall elimination provision reduces Social Security benefits for individuals who receive pension or disability benefits from employment that did not require them to contribute payroll taxes to the program.
More than 2 million workers are affected by the WEP, according to the legislative proposal.
The government pension offset reduces Social Security benefits for spouses, widows and widowers who also have pension income.
More than 745,000 Americans are affected by the GPO.

The reduced income can come as a shock to those who are affected — and can prompt those individuals to make difficult life decisions.
At a Wednesday Senate hearing, Roger Boudreau, president of the Rhode Island American Federation of Teachers Retirees Chapter, cited a 75-year-old schoolteacher who is still working for fear she would not have enough income to live on if she retires.
She currently receives Social Security benefits after her husband predeceased her. But if she retirees and begins collecting the pension benefits she earned, that Social Security income may disappear. Her pension benefits wouldn’t be enough to live on, Boudreau said.
“She is basically a slave to her job as a result of the government pension offset,” Boudreau said.

Why eliminating current rules may be problematic

But nixing the WEP and GPO completely could make benefits disproportionately generous to workers who only pay Social Security taxes for some of their careers, research from the Center on Budget and Policy Priorities has found.
Social Security benefits are progressive, which means the income replacement formula is more generous for low earners than for higher earners.
Consequently, pension-covered workers who have contributed fewer years to Social Security may look like low earners to the program. That can result in more generous benefits for those workers compared others who have spent their entire careers contributing to the program.
Both the WEP and GPO rules are designed to adjust benefits so people with a combination of covered and non-covered Social Security work don’t get treated more generously, said Paul Van de Water, senior fellow at the Center on Budget and Policy Priorities.
As a long-time federal employee who is now retired, Van de Water is personally affected by the windfall elimination provision.
“These bills would benefit me, but I still think they’re a bad idea,” Van de Water said.

Eliminating the rules through the Social Security Fairness Act would also cost the program at a time when Social Security faces looming trust fund depletion dates, he said.
The Congressional Budget Office has estimated the repeal would cost around $196 billion over 10 years.
Updating the current rules would be a better way to go, according to the Center on Budget and Policy Priorities. That could include a new income replacement rate that better reflects total income, including for spousal and survivor benefits.
The Bipartisan Policy Center has advocated for updating Social Security’s benefit formula to prorate benefits based on the share of an individual’s lifetime earnings that contributed to the program.
“The solution here certainly isn’t to repeal it,” Sprick said of the windfall elimination provision. “It’s to change it, it’s to make it clear, it’s to make it based on the most updated data that [the Social Security Administration] has access to.”
Nevertheless, lawmakers plan to continue to fight for elimination of the current rules through the Social Security Fairness Act.
“Get a hold of your representative or your senator to get on it, because this is part of a broken system,” Sen. Mike Braun, R-Ind., a Republican co-sponsor of the bill, said at this week’s Social Security hearing. “It’s an inequity that needs to be fixed.” More

Some workers believe they are either ahead or on time in terms of their retirement plans, according to a recent survey by CNBC.
Home equity or ownership contributes to the feeling of readiness.
But that confidence might be misplaced, according to Angie Chen, a senior research economist and the assistant director of savings research at the Center for Retirement Research at Boston College. 

Rgstudio | E+ | Getty Images

Owning a home makes some people feel more confident about their prospects for retirement — but that may be misguided, some experts say.
About 37% of polled workers — including those with part- or full-time jobs, or who are self-employed or business owners — say they are “ahead of schedule” (7%) or “on schedule” (30%) in their retirement savings, according to the Your Money Retirement Survey conducted by SurveyMonkey and CNBC.com.

Of those who said they were ahead or on schedule, 42% say an early start in retirement savings helped them get ahead. Other factors that contributed to their readiness included having little to no debt (38%) and home equity or ownership (37%), the report found.
The survey polled 6,657 adults, including 2,603 retired adults and 4,054 adult workers, in August.
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But homeowners’ confidence about the wealth in their home value might be misplaced, according to Angie Chen, a senior research economist and the assistant director of savings research at the Center for Retirement Research at Boston College. 
“Homeowners are actually more likely to be overconfident in their retirement readiness,” Chen said. “There’s a lot of misconception in terms of how people assess whether they are ahead or not in retirement.”

Still, owning a home can help bring other benefits in retirement years, said Winnie Sun, co-founder and managing director of Sun Group Wealth Partners in Irvine, California.
Here’s what to know.

‘Overconfident or not worried enough’

The Center for Retirement Research’s National Retirement Risk Index measures the share of working-age households at risk of being financially unprepared for retirement. When comparing individual household assessments with the NRRI in 2023, a CRR analysis found 28% are “not worried enough” — meaning they think they are not at risk, while the index predicts they are.
“People who own houses but still owe a lot on their houses are much more likely to be overconfident or not worried enough,” said Chen. 
In order to better assess retirement readiness, “it’s important to not just consider the value of your home, but also how much you borrowed,” said Chen, and how much you still owe.

For example: If you bought a $500,000 house, but still owe $400,000 on it, your equity is really $100,000, she said. Tapping that equity isn’t always cheap, and there can be risks to borrowing against your home, experts say.
“Housing is not really liquid,” Chen said. “You might feel good about having this large asset, but you can’t consume that in retirement. You can’t spend it in a way that you can spend and consume other types of savings.” 
On the other hand, owning a home can have certain upsides, according to experts.

‘You have a controlled cost of housing’

Whether you’re factoring home equity into retirement readiness or not, owning a home can have other financial benefits in retirement.
“Homeownership is sort of twofold,” said Sun, who is a member of CNBC’s Financial Advisor Council. 
For one, you’re building equity. When you sell the property — say if you downsize once you’re retired — you can access that money as a lump sum, Sun explained.
Plus, while you own the property “you have a controlled cost of housing” that may include a set mortgage payment, Sun said.
While homeownership costs such as home insurance and property taxes have increased in recent years, you may qualify for senior pricing on utilities by the time you’re retired, said Sun.

“A lot of my clients, as they get older, they also qualify for senior pricing on their utilities,” said Sun. “So some of their costs could come down as they get older.”
While a house is not liquid, you may be able to tap into your home equity if you need to, experts say.
“In most cases for retirees, they kind of see equity as their emergency fund,” Sun said. More

Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., September 4, 2024. 
Brendan Mcdermid | Reuters

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Here’s what CNBC TV’s producers were watching as the major averages made a stunning comeback from the day’s lows and what’s on the radar for the next session.

The big stock story of the day

Nvidia shares swung by about $10 from the session lows to the day’s high. The stock ended the day higher by 8%.
The stock jumped as CEO Jensen Huang spoke at the Communacopia conference saying Nvidia’s key Blackwell chip is in full demand and fears of a slowdown or production problems aren’t a concern. Investors reacted to his optimism.
The stock is still 17% from the June 20 high, but it’s up 136% so far in 2024.
The S&P tech sector was up 3.25% on Wednesday. It is 8% from the 52-week high.

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Nvidia’s year-to-date performance

The sectors

CNBC’s Mike Santoli, who always does a great job of explaining the market, made some great points. We’ll be following up on them Thursday.
He explained that Wednesday’s roughly 154-point turnaround for the S&P 500 — from the morning’s low to the high of the day near the end of the session — had to do with rising bond yields. The Dow swung about 910 points from its low to the day’s high, while the Nasdaq Composite saw a roughly 633-point jump.
Recently as yields have gone up, stocks have fallen. 
Because bond yields have retreated so quickly in the last few months, investors have grown nervous that they were dropping due to fears about the economy. In turn, this hurt confidence in stocks. 
Wednesday’s rise in yields, which also began in the late morning, as Santoli explained, gave a new boost of confidence to stock investors. 
The sectors that have done best in the last three months are rate-sensitive — for instance, real estate is up 18% in three months — as investors look for yield in the face of falling rates.
Utilities are up about 10% in three months.
Financials are up 8.6% in three months.
Energy and communication services are the weakest S&P sectors in the last three months, respectively down 6% and 5%.

Insurers

We’ll dive back into the insurance sector after Wednesday’s drop. CNBC TV’s Contessa Brewer covers the beat. She noted the fall for Travelers, down 3.16%, and Hartford Financial, down 2.4%. W.R. Berkley dropped 2.36%, and Aon fell 1.8%. 
Brewer’s sources say it may have to do with investor concern that an election win by Vice President Kamala Harris would lead to more litigation and fewer protections for businesses. This is a big issue for insurers across the country right now. Some investors are also worried that a Harris victory would lead to less consolidation in the industry.
The sector has been strong in the last three months.
Progressive is up about 20% in that time.
Aon up 17.4% in three months.
Hanover Insurance up 15.4%.
Arthur J. Gallagher up 15% in three months.
Hartford Financial up 14.7% in three months.
Willis Towers Watson is up 12% in three months. 

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Progressive shares over the past three months

Cocoa

Jill Schneider on the CNBC desk was watching the cocoa trade Wednesday.
The commodity was up more than 6% Wednesday. It is up 12% in a week.
Regulators in Ghana and Ivory Coast are talking with cocoa farmers about raising what the countries pay farmers for their crops.
Shares of Hershey fell more than 2% Wednesday.

Boeing

CNBC TV’s Phil LeBeau will be watching and waiting as 33,000 union members vote on a contract deal.
Boeing is 40% from the Dec. 21 high.
The stock is down 7% so far in September.

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Boeing’s 2024 performance

Solar stocks

There was a big move for the sector Wednesday as First Solar picked up 15%. The stock is 22% from the June high.
One reason was investors who back the industry think Vice President Harris put herself in a better position to win the election with her debate performance Tuesday evening. This set up a positive atmosphere for green energy, including solar.
Canadian Solar was up about 12% Wednesday. Shares are 51% from their high nearly a year ago.
Sunrun was up 11.3%. The stock is 14% from the Aug. 26 high.
SolarEdge was up 8.5% Wednesday. It’s still 87% from its high about a year ago.
The Invesco Solar ETF (TAN) rose 6.3%. It is 29% lower from the high it reached last September.

Kroger reports before the bell

The supermarket operator releases earnings Thursday morning.
Kroger is flat since last reporting three months ago.
CEO Rodney McMullen recently testified that the proposed merger with Albertsons would bring large savings to customers. The Federal Trade Commission is suing to block the deal, saying it would decrease competition and be bad for consumers. More