Early Look
Friday, August 4, 2023
|
Futures |
Up/Down |
% |
Last |
|
Dow |
29.00 |
0.08% |
35,341 |
|
S&P 500 |
11.25 |
0.25% |
4,533 |
|
Nasdaq |
57.50 |
0.37% |
15,496 |
U.S. stocks are looking at a higher open after earnings last night and ahead of key economic data later this morning but remain on track for weekly losses to start the month. Earnings overnight moving a handful of names with Amazon (AMZN) results lifting shares by 9% and helping boost the Nasdaq while Apple (AAPL) slips over -1% after some segment revenues fell short of consensus and guidance was seen as conservative. Nonfarm payroll data expected at 8:30 AM ET, with the est. for +200K Nonfarm payrolls, +179K private and +5K manufacturing) while unemployment expected to dip to +0.3%. Averages wages expected to rise +0.3% M/M (recall ADP with huge beat yesterday). Treasury yields are holding steady from yesterday’s close, with the benchmark 10-year yield holding around 4.19% (yesterday’s highs) and the dollar is flat as well at 102.54 into the important jobs report. In Asian markets, The Nikkei Index gained 33 points to 32,192, the Shanghai Index gained 7 points to 3,288, and the Hang Seng Index rose 118 points to 19,539. In Europe, the German DAX is down -15 points to 15,877, while the FTSE 100 is down a few points to 7,520.
Market Closing Prices Yesterday
· The S&P 500 Index dipped -11.50 points, or 0.25%, to 4,501.89.
· The Dow Jones Industrial Average fell -66.63 points, or 0.19%, to 35,215.89.
· The Nasdaq Composite slipped -13.73 points, or 0.10%, to 13,959.72.
· The Russell 2000 Index declined -5.43 points, or 0.28% to 1,961.40.
Economic Calendar for Today
· 8:30 AM ET Nonfarm Payrolls for July…est. +200K
· 8:30 AM ET Private Payrolls for July…est. +179K
· 8:30 AM ET Manufacturing Payrolls for July…est. +5K
· 8:30 AM ET Unemployment Rate for July…est. +0.3%
· 8:30 AM ET Average Hourly Earnings M/M…est. +0.3%
· 1:00 PM ET Baker Hughes Weekly rig count data
· 3:00 PM ET Consumer Credit for June
Earnings Calendar:
· Earnings Before the Open: AES AMCX AMR AXL CBOE CLMT CNK D DBRG ESNT FLR FSR FUBO FWONA GNK GPRE GTN LBRDA LSXMA LYB MMI NKLA OMI PAA PNM PPL QRTEA SHO SSP TILE TWST XPO
|
Macro |
Up/Down |
Last |
|
Nymex |
0.50 |
82.05 |
|
Brent |
0.47 |
85.61 |
|
Gold |
-0.80 |
1,968.00 |
|
EUR/USD |
0.000 |
1.0943 |
|
JPY/USD |
0.23 |
142.76 |
|
10-Year Note |
+0.003 |
4.192% |
World News
· June German factory orders came in at 7.0% MoM vs the consensus of -2.0%; German Factory Orders were all driven by large-ticket items.
· The July UK S&P Global/CIPS Construction PMI beat at 51.7 vs the expected 48.0. The overall construction rise was led by infrastructure activity while residential housing activity softened.
· French industrial production for June was weak, falling -0.9% MoM vs the expected -0.3%. YoY was -0.3% vs the call of 1.7%.
Sector News Breakdown
Consumer
· AirBnB (ABNB) Q2 adj EBITDA $819Mm vs est. $728.5Mm on revs $2.5B vs est. $2.42B, FCF $900Mm, qtrly ADR $166 +1%, qtrly gr booking value $19.1B +13%; sees Q3 revs $3.3-3.4B vs est. $3.22B, sees record-high adj EBITDA in Q3 on nominal basis and adj EBITDA mgn up y/y; sees FY adj EBITDA mgn modestly higher than year ago.
· American Eagle (AEO) said it sees 2q operating income to exceed $25m to $35m; sees Q2 revs to be about flat to last year; sees Q2 rev & operating income exceeding prior guidance; said COO Michael Rempel to step down.
· Booking.com (BKNG) Q2 EPS $37.62 vs. consensus $28.80; Q2 revs $5.5B vs. est. $5.17B; Q2 gross travel bookings of $39.7B, an increase of 15% y/y and room nights booked increased 9% from the prior-year quarter; says continued to see robust leisure travel demand in Q2.
· DraftKings (DKNG) Q2 EPS loss (-$0.17) vs. est. loss (-$0.25); Q2 revs $874.93M vs. est. $759.55M; raises 2023 sales outlook to $3.46B-$3.54B from $3.135B-$3.235B and is improving its FY23 adj EBITDA to now ($190M)-($220M).
· Floor & Décor Holdings (FND) Q2 EPS $0.66 vs est. $0.66 on sales $1.136B vs est. $1.148B, comps -6%, adj EBITDA $152.8Mm vs est. $145.96Mm; guides FY net sales $4.46-4.53B vs est. $4.626B, comps -7% to -5.5%, adj EBITDA $570-595M vs est. $589.33M, adj EPS $2.30-2.50 vs est. $2.63.
· Funko (FNKO) cut its sales outlook for the year as it expects softness, because of ongoing inventory destocking by some of its largest US wholesale customers, to continue in the second half of the year; said plans to reduce the number of product lines and complexity in its business to run like a “lean startup.”
· Monster (MNST) Q2 EPS $0.39 vs est. $0.39 on revs $1.85B vs est. $1.87B.
· QuantumScape (QS) 37.5M share Secondary priced at $8.00.
· Tupperware (TUP) shares rise over 50% after saying it reached an agreement with its lenders to restructure its existing debt obligations, as it continues its turnaround efforts.
Energy
· ConocoPhillips (COP) files automatic mixed securities shelf.
· EOG Resources (EOG) Q2 adj EPS $2.49 vs. est. $2.32; Q2 revs $5.573B vs. est. $5.31B; said resilient demand for fuel and higher production offset a decline in oil and gas; production averaged at 970,300 barrels of oil equivalent per day (boepd) during the quarter, rising from 920,700 boepd y/y; said its realized price for oil averaged $74.97 per barrel.
· Southwestern (SWN) Q2 adj EPS $0.09 vs. est. $0.06; Q2 revs $1.27B vs. est. $1.27B
Financials
· Block Inc. (SQ) Q2 adj EPS $0.39 vs. est. $0.36; Q2 revs $5.53B vs. est. $5.1B; said processed $59.01B in in GPV in Q2, up 12% y/y; Q2 subscription and services-based revenue rose 33% y/y to $1.46BB and transaction-based revenue rose 11% y/y to $1.64B; sees FY23 adjusted EBITDA $1.5B vs. previous view $1.36B.
· Coinbase (COIN) Q2 EPS ($0.42) vs est. ($0.77) on revs $662.5Mm vs est. $633Mm; maintains goal to improve FY adj EBITDA in absolute dollar terms vs year ago; sees Q3 sales & mktg exp $80-90Mm, sees Q3 subscription and services revs to be at least $300Mm.
· Redfin (RDFN) Q2 EPS loss (-$0.25) vs. est. loss (-$0.31); Q2 revs $275.6M vs. est. $275.7M; said Q2 net income improved by $50M and expect to break-even on an adjusted-EBITDA basis over the next 12 months rather than in 2023; sees Q3 revenue $265M-$279M, vs. est. $288.21M.
· Extra Storage Space (EXR) Q2 EPS $1.50 vs est. $1.51; core FFO/shr $2.06 vs est. $2.14, same-store occupancy 94.5%, same-store revs +2.7%, same-store NOI +2.6%.
· Opendoor Technologies (OPEN) Q2 adj EBITDA $(168)Mm vs est. $(187)Mm on revs $2.0B vs est. $1.836B; guides Q3 revs $950Mm – 1.0B vs est. $1.359B and adj EBITDA $(70)Mm – $(60)Mm vs est. $(56.7)Mm.
Healthcare
· AmerisourceBergen (ABC) announces 10.5M share registered public offering.
· Amgen Inc. (AMGN) Q2 adj EPS $5.00 vs. est. $4.08; Q2 revs $7.0B vs. est. $6.06B; raises FY23 adj EPS view to $17.80-$18.80 from $17.60-$18.70 (est. $16.12; and boosts FY23 revenue view to $26.6B-$27.4B from $26.2B-$27.3B (est. $24.12B); reports positive top-line results from global phase 2 dellphi-301 study, evaluating tarlatamab, in small cell lung cancer.
· Assertio Holdings (ASRT) plunges after hours after withdrawing guidance to assess the impact of an FDA-approved generic indomethacin, an arthritis drug.
· DaVita (DVA) Q2 adj EPS $2.08 vs. est. $1.69; Q2 revs $3B vs. est. $2.95B; guides FY23 adjusted EPS $7.00-$7.80 vs. consensus $6.65.
· Dynavax (DVAX) Raises full year revenue guidance; cash and investments increased to $682 million at quarter end; expects positive free cash flow for full year.
· Gilead Sciences (GILD) Q2 adj EPS $1.34 vs. est. $1.64; Q2 revs $6.6B vs. est. $6.44B; cuts FY23 EPS view to $6.45-$6.80 from $6.60-$7.00 (vs. est. $6.73) while boosts FY23 product sales view to $26.3B-$26.7B from $26B-$26.5B.
· Natera Inc. (NTRA) Q2 EPS ($0.97) vs est. ($1.09) on revs $261.4Mm vs est. $242.06Mm; raises FY revs guide from $995Mm-1.015B to $1.015-1.035B vs est. $1.009B, sees FY gr mgn 41-44%, SG&A $540-580Mm, R&D exp 325-345Mm, net cash consumption $300-325Mm.
· Progyny (PGNY) Q2 EPS $0.15 vs est. $0.10 on revs $279.373Mm vs est. $261.9Mm, adj EBITDA $47.464Mm vs est. $44.88Mm; guides Q3 revs $268-273Mm vs est. $265.24Mm and adj EBITDA $44.7-46.2Mm vs est. $45.98Mm; sees FY revs $1.075-1.09B vs est. $1.055B.
· ResMed (RMD) Q4 adj EPS $1.60 vs est. $1.69 on revs $1.1B vs est. $1.14B; adj gr mgn 55.8%.
· Stryker (SYK) Q2 adj EPS $2.54 vs. est. $2.38; Q2 revs $5.0B vs. est. $4.82B; sees 2023 adjusted EPS $10.25-$10.45, vs. consensus $10.16 and sees 2023 organic net sales growth 9.5%-10.5%; Reported operating income margin of 19.3%; Q2 MedSurg and Neurotechnology net sales rose 12.2% to $2.9B and Orthopaedics and Spine net sales of $2.1 billion increased 9.9%.
· Tandem Diabetes (TNDM) Q2 EPS loss (-$0.55) vs. est. loss (-$0.53) on weaker sales $195.9M vs. est. $197.36M; cuts non-GAAP sales are estimated to be at least $785 million with sales in third quarter of at least $190 million, estimates $238.94 Q3 and $881.47 million 2023.
Industrials & Materials
· Air Lease (AL) Q2 EPS $1.58 vs. est. $1.07; Q2 revs $672.3M vs. est. $660.3M; said are 100% placed through 2024, and we placed 58% of our total order book; says past Friday received a further incremental delay notice from Boeing on our Max deliveries; VCEO says are watching airbus deliveries carefully in face of RTX’s announcement last week on manufacturing defects on certain of its gear turbofan engines.
· Carlisle (CSL) authorizes the buyback of an additional 7.5M shares of common stock.
· Corteva Inc. (CTVA) Q2 EPS $1.60 beats but sales $6.01B misses the $6.46B estimate and lowers FY23 operating EPS view to $2.75-$2.90 from $2.80-$3.00 (est. $2.90) and lowers FY23 revenue view to $17.9B-$18.2B from $18.6B-$18.9B.
· Livent Corp. (LTHM) Q2 adj EPS $0.51 vs. est. $0.47; Q2 revs $235.8M vs. est. $252.86M; sees FY23 revenue $1.03B-$1.13B vs. est. $1.09B; said for Q2, volume was roughly flat but prices were lower and costs were higher.
· MasTec (MTZ) 18-month backlog as of June 30, 2023, was $13.4 billion, up 22% compared to last year’s second quarter; Q2 revs $2.87B vs. est. $3.0B; sees FY23 revs $12.7B-$13B vs. est. $13.17B; lowers adj EPS view to $3.75-$4.19 from $4.64-$4.91.
· Werner Enterprises (WERN) Q2 adj EPS $0.52 vs. est. $0.59; Q2 revs $811.1M vs. est. $817.85; Q2 operating margin of 5.8%, down 320 bps; non-GAAP adjusted operating margin of 6.3%, down 300 basis points; raises capex view to $400M-$450M from $350M-$400M.
Technology, Media & Telecom
· Apple Inc. (AAPL) Q3 revs $81.80B vs. est. $81.55B; Q3 EPS $1.26 vs. est. $1.20; products revs: Products revenue down -4.4% y/y to $60.58B, iPhone revs -2.4% y/y to $39.67B, Mac revs -7.3% y/y to $6.84B (but above views), iPad revs -20% y/y to $5.79B (weaker) while wearables, home and accessories rise 2.5% y/y to $8.28B; Q2 service revenue $21.21B, +8.2% y/y (better).
· Atlassian Corp. (TEAM) Q4 revs rose 24% y/y to $939.08M vs. est. $914.6M; Q4 adj EPS $0.57 vs. est. $0.45; Q4 subscription revenue of $800M, up 34% y/y and Q2 GAAP operating margin of (5)% and non-GAAP operating margin of 22%; sees Q1 revs $950M-$970M.
· BigCommerce Holdings (BIGC) Q2 adj EPS ($0.02) vs est. ($0.09) on revs $75.4Mm vs est. $73.35Mm, adj gr mgn 77%; sees Q3 revs $76.3-79.3Mm vs est. $78.79Mm and adj operating loss $1.0-5.0Mm; sees FY revs $304-310Mm vs est. $306.32Mm and adj op loss $10.2-15.2Mm.
· Cloudflare (NET) Q2 adj EPS $0.10 vs est. $0.07 on revs $308.494Mm vs est. $305.55Mm; guides Q3 revs $330-331Mm vs est. $329.41Mm, adj EPS $0.10 vs est. $0.09; sees FY revs $1.283-1.287B vs est. $1.282B, adj EPS $0.37 vs est. $0.34.
· DigitalOcean Holdings (DOCN) Q2 adj EBITDA $72Mm vs est. $63.77Mm on revs $169.814Mm vs est. $170.07Mm; guides Q3 revs $172.5-174Mm vs est. $179.51Mm and adj EBITDA mgn 38-39%; sees FY revs $680-685Mm vs est. $704.15Mm and adj EBITDA mgn 38-39%.
· Dropbox (DBX) Q2 adj EPS $0.51 vs est. $0.46 on revs $622.5Mm vs est. $613.78Mm, adj gr mgn 82.7%, adj EBIT mgn 34.2%.
· Fortinet (FTNT) Q2 adj EPS $0.38 vs. est. $0.34 as revs rise 26% y/y to $1.29B vs. est. $1.3B and billings +18% y/y to $1.54B vs. est. $1.59B; sees FY23 revenue $5.35B-$5.45B, down from prior $5.43B-$5.49B and better EPS view but sees billings $6.49B-$6.59B, down from $6.75B-$6.81B, with lower service revenue $3.35B to $3.41B, but better margins.
· Microchip (MCHP) Q1 EPS $1.21 vs est. $1.64 on sales $2.289B vs est. $2.29B; guides Q2 net sales $2.22-2.312B vs est. $2.281B, adj gr mgn 68.3-68.5%, adj op mgn 47.8-48.4%, adj EPS $1.60-1.64 vs est. $1.63.
· Motorola Solutions (MSI) Q2 adj EPS $2.65 vs est. $2.51 on sales $2.4B vs est. $2.357B; guides Q3 revs +6% vs est. +4.9% and adj EPS $2.99-3.04 vs est. $3.00; sees FY revs $9.875-9.9B vs est. $9.793B.
· Power Integrations (POWI) Q2 adj EPS $0.36 vs est. $0.34 on revs $123.223Mm vs est. $122.4Mm; sees Q3 revs $125-135Mm vs est. $149.55Mm.
· Qualys Inc. (QLYS) Q2 adj EPS $1.27 vs est. $1.01, adj EBITDA $65.8Mm vs est. $56Mm on revs $137.2Mm vs est. $135.65Mm, adj gr mgn 82%; guides Q3 revs $140.5-141.5Mm vs est. $140.99Mm, adj EPS $1.10-1.15 vs est. $1.05; sees FY revs $553-555Mm vs est. $553.67Mm and adj EPS $4.50-4.65 vs est. $4.23.
· Sprout Social (SPT) Q2 EPS ($0.24) vs est. ($0.02) on revs $79.315Mm vs est. $78.7Mm, ARR $326.1Mm; has acquired Tagger Media for cash $140Mm.
· Synaptics (SYNA) Q4 EPS $0.49 vs. est. $0.43; Q4 revs $227.3M vs. est. $223.23M; sees Q1 revenue $215M-$245M vs. est. $238.98M; non-GAAP gross margin of 55.7%.
· Universal Display (OLED) Q2 EPS $1.04 vs est. $0.76 on revs $146.6Mm vs est. $128.6Mm, gr mgn 78%; guides FY revs $560-600Mm vs est. $573.72Mm.
Market commentary provided by Hammerstone Markets, Inc, a firm separate from and not affiliated with Regal Securities. Regal Securities has not participated in the creation of the content, and does not explicitly or implicitly endorse the content.