Early Look

Wednesday, April 28, 2021

Futures	Up/Down	%	Last
Dow	-40.00	0.12%	33,843
S&P 500	4.25	0.10%	4,183
Nasdaq	-15.50	0.11%	13,937

 

 

U.S. futures are mixed following some good earnings results overnight, but also some mixed responses, keeping U.S. futures in-line as market participants await the conclusion of the 2-day FOMC policy meeting results later today. Investors expect the Federal Reserve to keep policy and asset purchases unchanged, but will watch closely to indications of when the Fed might begin to trim its $120 billion in monthly asset purchases and its outlook on inflation. In Washington, President Biden is expected to ask Congress for an additional $1.8T for spending on healthcare, childcare & education as he addresses the nation later tonight in his first 100-days in office, according to reports; will pay for the additional spending through tax hikes; will recommit he won’t increase taxes on household making under $400k. U.S. stocks finished mixed on Tuesday, with the Nasdaq and S&P 500 index each falling from all-time closing highs the day prior as the earnings barrage in tech land gets underway. The Dow Jones transportation average jumped to a new record closing high, on track for a record 13th straight week of gains, while the homebuilder index also settled at an all-time best. In Asian markets, The Nikkei Index gained 62 points to 29,053, the Shanghai Index gained 14 points to 3,457, and the Hang Seng Index jumped 129 points to 29,071. In Europe, the German DAX is up over 50 points to 15,305, while the FTSE 100 gains about 20 points to 6,965 in another strong session for European markets.

 

Market Closing Prices Yesterday

·     The S&P 500 Index slipped -0.90 points, or 0.02%, to 4,186.72

·     The Dow Jones Industrial Average rose 3.36 points, or 0.01%, to 33,984.93

·     The Nasdaq Composite dipped -48.56 points, or 0.34%, to 14,090.22

·     The Russell 2000 Index gained 3.26 points, or 0.14% to 2,301.27

 

Events Calendar for Today

·     7:00 AM ET         MBA Mortgage Applications Data

·     8:30 AM EST      Advance Goods Trade Balance for March

·     2:00 PM EST       FOMC Meeting results

·     10:30 AM ET      Weekly DOE Inventory Data

 

Earnings Calendar:

·     Earnings Before the Open: ADP, APH, AVY, BA, BCO, BSX, CHEF, CIT, CME, DAN, DISCA, DX, EAT, ETR, EVR, EXTR, FORM, GD, HELE, HES, HUM, IART, IPG, LFUS, MAS, MCO, NPX, NSC, NYCB, OC, OSK, PAG, PB, R, RJF, ROK, ROL, SC, SHOO, SIRI, SIX, SLAB, SLGN, SWK, TKR, VRTS, WING, WNC, YUM

·     Earnings After the Close: AAPL, AFL, AKR, ALGN, ALSN, ALTA, AMED, ASGN, ATUS, AVB, AVT, AZPN, BCOV, BHE, BLKB, CAKE, CCS, CDE, CINF, CLR, CMO, CONE, CREE, CYH, DRE, EBAY, EQIX, F, FB, FIX, GRUB, HOLX, HR, IR, ISBC, JAKK, KALU, KRA, LC, MC, MGM, MOH, MTDR, MTH, NBR, NLY, NOW, OI, OII, PI, PSA, PTC, QCOM, SP, TDOC, TTMI, TWOU, TYL, UCTT, URI, VKTX, VVV, WELL, WERN, WH, WRE

 

 

Macro	Up/Down	Last
Nymex	0.07	63.01
Brent	0.03	66.45
Gold	-10.00	1,766.50
EUR/USD	-0.0019	1.2072
JPY/USD	0.24	108..94
10-Year Note	+0.023	1.645%

 

 

World News

·     DoubleLine Capital CEO Jeff Gundlach said the Fed is guessing that inflation will be transitory ‘ ; “there’s plenty of indicators that suggest that inflation is going to go higher, and not just on a transitory basis, for a couple of months; so we’ll see how the fed is trying to paint the picture, but they’re guessing

 

Sector News Breakdown

Consumer

·     Starbucks (SBUX) Q2 adj EPS 62c vs. est. 53c; Q2 revenue $6.7B vs. est. $6.82B; raises FY21 adjusted EPS view to $2.90-$3.00 from $2.70-$2.90 (est. $2.85) and boosts FY21 revenue view to $28.5B-$29.3B from $28B-$29B (est. $28.61B); reaffirms year comp sales view; for Q2 China comparable sales up 91%, including reinstated vat benefit; Q2 international comparable sales up 35%; Q2 Americas comparable sales up 9% demonstrating full sales recovery

·     ACCO Brands (ACCO) 1Q adj EPS $0.10 vs est $0.03 on revs $411Mm vs est $390.3Mm, same-store sales -13.5%; guides 2Q adj EPS $0.25-0.30 vs est $0.20, sees 2Q sales $460-490Mm with Powera contributing $50-60Mm vs est $452Mm; says confident for FY can generate at least $135Mm FCF

·     Boyd Gaming (BYD) 1Q EPS $0.90 vs est $0.44 on revs $753.3Mm vs est $681.4Mm; says as economic conditions improve and vaccinations roll out, seeing increased visitation, growing spend per visit across every customer segment

·     Ethan Allen (ETH) announces dividend, declares special cash dividend of 75c per share

·     Haverty (HVT) Q1 EPS $1.04 vs. est. 41c; Q1 revenue $236.5M vs. est. $200.57M; Q1 comp store sales increased 11.5%; expect gross profit margins for 2021 will be between 56.5% to 57.0%

·     Hawaiian Airlines (HA) 1Q adj EPS ($3.85) vs est ($3.72) on revs $182Mm vs est $194.6Mm; guides 2Q ASM down 30-33%, sees 2Q revs down 45-50%, sees 2Q fuel price per gallon $1.75; guides FY CAPEX $50-60Mm

·     Mondelez (MDLZ) Q1 EPS 77c vs. est. 69c; Q1 revenue $7.24B vs. est. $7.02B; qtrly net revenues increased 7.9% driven by organic net revenue growth of 3.8%; sees FY organic net revenue growth 3%+ and sees FY adjusted eps growth in high single-digit; sees FY free cash flow over $3 bln

·     Six Flags (SIX) Q1 EPS loss ($1.12) vs. est. loss ($1.28); Q1 revenue $82M vs. est. $48.03M; Attendance declined 15% from the same period in 2020 and 38% from 2019; at 1.3 million guests, attendance at open parks was about 95% of the first quarter of 2019 at those same locations

·     USANA Health (USNA) 1Q EPS $1.45 vs est $1.49 on sales $308Mm vs est $301.5Mm; now sees FY net sales $1.24-1.28B vs. est $1.24B, sees FY EPS $6.15-6.50 vs est $6.29

·     Yum China (YUMC) 1Q adj EPS $0.54 vs est $0.46 on revs $2.56B vs est $2.14B, qtrly system sales +34% (KFC +24%, Pizza Hut +57% ex FX), qtrly comps +10% (KFC +5%, Pizza Hut +38% ex FX); says continue to expect recovery of same-store sales to 2019 levels to take time with recovery path uneven, non-linear

 

Energy

·     The American Petroleum Institute (API) reports that crude inventories rose 4.32M barrels last week. Gasoline inventories fell 1.29M barrels

·     Edison International (EIX) Q1 EPS 79c vs. est. 76c; Q1 revenue $2.96B vs. est. $3.20B.

·     Enphase Energy (ENPH) Q1 adj EPS 56c vs. est. 45c; Q1 revs $301.8M vs. est. $292.2M; guides Q2 revs $300M-$320M vs. est. $320.9M

·     ONEOK (OKE) Q1 EPS 86c vs. est. 77c; boosts FY21 net income midpoint to $1.35B from $1.23B and also increases FY21 adjusted EBITDA midpoint to $3.2B from $3.05B; guides FY21 EPS $2.69-$3.35 vs. est. $3.11

·     National Oilwell (NOV) reports Q1 EPS loss (30c) vs. est. loss (22c); Q1 revenue $1.25B vs. est. $1.27B; Adjusted EBITDA (operating profit excluding depreciation, amortization, and other items) decreased $17 million sequentially to $0

·     Unitil Corp. (UTL) will replace Waddell & Reed Financial Inc. (WDR) in the S&P SmallCap 600 which is being acquired by Macquarie Group in a deal expected to be completed soon pending final conditions.

 

Financials

·     Capital One Financial (COF) Q1 EPS $7.03 vs. est. $4.17; Q1 revenue $7.1B vs. est. $6.98B; qtrly net interest margin of 5.99%, an decrease of 6 basis points; common equity tier 1 capital ratio under Basel iii standardized approach of 14.6% at March 31, 2021; qtrly benefit for credit losses $823 mln vs provision for credit losses of $5,423 mln

·     Chubb (CB) Q1 core EPS $2.52 vs. est. $2.49; Q1 consolidated net premiums written up 8.6%, with commercial P&C lines globally up 15.6%; Q1 reflected $1.1b loss in investment portfolio, mainly due to rising interest rates; said Q1 also included $275m gain in variable annuity reinsurance portfolio

·     NCR Corp. (NCR) 1Q adj EPS $0.51 vs. est. $0.47 on revs $1.544B vs. est. $1.54B; says expects all segment results to be negatively impacted by covid

·     Principal Financial (PFG) Q1 EPS $1.53 vs. est. $1.34; posts record assets under management (AUM) of $820.3 billion; raises dividend by 5%; Retirement and Income Solutions (RIS) — Fee had record sales of $8.1 billion which drove $5.7 billion of net cash flow

·     Visa Inc. (V) 2Q EPS $1.38 vs est $1.27 on net revs $5.7B vs est $5.55B; not providing FY guide at this time; said payments volume for three months ended march 31, 2021, increased 11% over prior year on constant-dollar basis; Q2 processed transactions up 8%

·     Comerica Inc. (CMA) approved authorization to repurchase up to an additional 10 mln shares of co’s outstanding common stock

·     Genpact Limited (G) will replace Genworth Financial Inc. (GNW) in the S&P MidCap 400, and Genworth Financial will replace Glu Mobile Inc. (GLUU) in the S&P SmallCap 600 (EA is acquiring GLUU)

 

Healthcare

·     Amgen Inc. (AMGN) 1Q adj EPS $3.70 vs. est. $4.05 on revs $5.9B vs est $6.25B; reaffirms FY revs guide $25.8-26.6B vs est $26.4B; sees FY EPS $16.00-17.00 vs est $16.80; sees ongoing covid disruption for 2Q, less in 2H

·     Humana (HUM) has agreed to buy the slice of Kindred at Home that it doesn’t already own from two private-equity partners, in a deal that gives the home-health business an enterprise value of $8.1 billion. Will acquire the 60% of Kindred currently held by TPG Capital and Welsh, Carson

·     Illumina (ILMN) Q1 EPS $1.89 vs. est. $1.38; Q1 revenue $1.09B vs. est. $1.0B; said it achieved its first billion-dollar revenue quarter in company history and delivered a very strong start to 2021, exceeding our expectations; sees FY21 EPS $5.80-$6.05 vs. est. $5.51 and sees 20201 YoY revenue growth in the range of 25% to 28%

·     Stryker (SYK) Q1 EPS $1.93 vs. est. $1.99; Q1 revenue $3.95B vs. est. $3.96B; qtrly organic net sales increased 1.8% from 2020 and 4.7% from 2019; continue to expect 2021 organic net sales growth to be in range of 8% to 10% YoY; sees FY21 EPS $9.05 -$9.30 vs. consensus $9.08; expect continued unfavorable price reductions of approximately 1% in 2021

 

Industrials & Materials

·     CH Robinsons Worldwide (CHRW) Q1 EPS $1.28 vs. est. 98c; Q1 revenue $4.8B vs. est. $4.40B; says within our NAST business, we expect tight market conditions to continue through balance of this year; Q1 revenues increased 26.3 percent to $4.8 billion, driven primarily by higher pricing and higher volume across most of our service lines

·     IDEX Corp. (IEX) 1Q adj EPS $1.51 vs est $1.41 on sales $652Mm vs est $634.9Mm, qtrly orders $710.7Mm +10%; guides 2Q adj EPS $1.60-1.63 vs est $1.46, sees 2Q organic revs growth +18-20%; sees FY adj EPS $6.05-6.20 vs est $5.88; guides FY organic revs growth +9-10%; entered into a definitive agreement to acquire Airtech, US Valve Corporation for cash consideration of $470M.

·     Matson (MATX) Q1 EPS $1.99 vs. est. $1.63; Q1 revenue $711.8M vs. est. $661.35M

·     Olin (OLN) Q1 EPS $1.51 vs. est. $1.28; Q1 revenue $1.92B vs. est. $1.93B; now expects to deliver adjusted EBITDA of $1.8 billion to $2.1 billion for 2021

 

Semiconductors

·     AMD Inc. (AMD) Q1 EPS 52c vs. est. 44c; Q1 revenue $3.45B vs. est. $3.21B; raises FY21 revenue view to up 50% from up 37%; Q1 Computing and Graphics segment revenue was $2.1B, up 46% YoY and 7% QoQ primarily driven by Ryzen processor and Radeon graphics product sales growth; sees Q2 revenue $3.6B +/- $100M, vs. est. $3.29B saying YoY increase is expected to be driven by growth in all businesses

·     Maxim integrated (MXIM) Q3 adj EPS 82c vs. est. 74c; Q3 revenue $665M vs. est. $639.14M; Q3 Cash flow from operations: $271 million and capital expenditures: $16 million

·     Teradyne (TER) Q1 ad EPS $1.11 vs. est. $1.05; Q1 revenue $782M vs. est. $760.42M; sees Q2 adj EPS $1.62-$1.83 above the consensus $1.32 and sees Q2 revenue $1.01B-$1.09B above est. $877.53M saying a recovery for industrial automation is in full swing

·     Texas Instruments (TXN) Q1 EPS $1.87 vs. est. $1.58; Q1 revenue $4.29B vs. est. $3.99B; sees Q2 EPS $1.68-$1.92 vs. est. $1.68; sees Q2 revenue $4.13B-$4.47B vs. est. $4.16B; said continue to expect our 2021 annual operating tax rate to be about 14%

 

Technology, Media & Telecom

·     Alphabet (GOOGL) Q1 EPS $26.29 vs. est. $15.82; Q1 revenue $55.3B vs. est. $51.7B; 1q operating margin 30%; Q1 operating income $16.44B, Q1 google advertising revenue $44.68B; google cloud revenue $4.05B; search & other revenue $31.88B; Q1 YouTube ads revenue $6.01B; says may repurchase up to added $50B in stock

·     Microsoft (MSFT) 3Q adj EPS $1.95 vs est $1.78 on revs $41.7B vs est $41B; qtrly LinkedIn revs +25%, qtrly office comm’l and cloud service revs +14%, qtrly intelligent cloud revs $15.1B +23%, qtrly productivity and biz process revs $13.6B +15%, qtrly Xbox content and svc revs +34%

·     FireEye (FEYE) Q1 adj EPS 8c vs. est. 6c; Q1 revenue $246M vs. est. $236.97M; said rev growth led by Cloud Subscription and Managed Services category, which increased 26% YoY and our Professional Services category, up 25% YoY; raises FY21 adjusted EPS view to 39c-41c from 35c-37c (est. 36c) and boosts FY21 revenue view to $1.01B-$1.03B from $990M-$1.01B (est. $1B)

·     F5 Networks (FFIV) 2Q adj EPS $2.50 vs est $2.40 on revs $645Mm vs est $636Mm; guides 3Q adj EPS $2.36-2.54 vs est $2.50, sees 3Q revs $620-650Mm vs est $635.2Mm

·     Juniper Networks (JNPR) 1Q adj EPS $0.30 vs est $0.25 on revs $1.07B vs est $1.06B; invested to strengthen supply chain and have increased inventory levels over course of last yr, believes will have access to sufficient semi supply to meet FY forecast; guides 2Q revs approx $1.0-1.19B vs est $1.13B, sees 2Q adj EPS $$0.33-0.43 vs est $0.37

·     Pinterest (PINS) 1Q adj EPS $0.11 vs est $0.07 on revs $485Mm vs est $473.7, MAUs at qtr end 478Mm +30%; guides 2Q revs about +105% vs est +95%, sees 2Q MAUs to grow +mid-teens globally and around flat yr/yr in US; says starting in mid-march, easing of pandemic restrictions slowed US MAU growth and lowered engagement

·     Tenable Holdings (TENB) Q1 EPS 13c vs. est. 6c; Q1 revenue $123.2M vs. est. $119.78M; sees FY21 EPS 24c-28c vs. est. 30c; sees FY21 revenue $520M-$524M vs. est. $515.56M