Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Stocks were lower heading into the weekend , putting the S & P 500 on pace to scrap the potential for a three-session winning streak. Still, the index is on track for a winning week, especially after Thursday’s record-high close. There were lots of mixed macro signals Friday, with a big miss on July retail sales, which unexpectedly fell 0.6% in July when economists had expected a slight increase. The numbers may raise some concern about consumer spending, especially after the weak unemployment report from last Friday. Earnings and commentary next week from several major retailers will provide more details on whether the consumer is going through a soft patch or a broader slowdown. Bond yields surged higher Friday, with the 10-year Treasury yield back up near 4.7%. U.S. and international oil prices were also slightly higher Friday, as traders awaited more clarity on potential economic sanctions against Iran. The memory trade extended its recent gains, with SanDisk leading the pack after a bullish Investor Day presentation on Thursday. SanDisk is essentially a storage-memory company focused on NAND flash memory, while Micron specializes in DRAM (dynamic random-access memory), including high-bandwidth memory (HBM). Micron, our newest portfolio position, also has a significant NAND business. SanDisk and Micron may not be the same, but both are taking a similar approach to this unprecedented memory cycle, locking in extraordinary demand at high prices through long-term agreements that provide greater visibility into future volumes and pricing. The objective of these deals is to structurally reset margins higher and reduce overall cyclicality. Based on what SanDisk told investors yesterday, these agreements are accomplishing just that. Under its new financial model, SanDisk expects non-GAAP gross margins to sustain at approximately 80%, with non-GAAP operating margins at approximately 75% for the period from fiscal year 2028 through fiscal year 2030. (GAAP stands for generally accepted accounting principles.) SanDisk sustaining at a higher margin for longer suggests these new models make the company more durable than the typical boom-bust commodity cycles memory traditionally falls under. Time will tell how this will all play out. With any type of long-term framework, it’s always important to remember that these are only estimates and that the actual results vary. But the adoption of these new business models should, in theory, help memory stocks like Micron trade at a slightly higher price-to-earnings multiple. One more note: SanDisk said it plans to return 100% of its excess cash to shareholders during the fiscal years 2028 to 2030 after investing in the business. If Micron were to follow a similar path, that would be music to our ears. As we pointed out Thursday, Micron’s free cash flow was about $17.5 billion in the third quarter and is expected to be about $50 billion in fiscal year 2026, which has one quarter remaining. If Micron were to adopt a similar strategy starting next year, it could buy back roughly 10% of its market cap in fiscal year 2027 based on its estimated $124 billion of free cash flow. Next week is a big one for retail and the state of the U.S. consumer. Club names Home Depot and TJX Companies , as well as Lowe’s , Walmart , and Target , are all scheduled to report earnings. We’ll also get quarterly results from Toll Brothers, Estee Lauder, Viking Holdings, Alibaba, Ross Stores, Advanced Auto Parts, Deere, and BJ’s Wholesale. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
What SanDisk told investors this week is a boon for our newest stock