Morning Preview: August 07, 2024

Auto PostDaily Market Report

Early Look

Wednesday, August 7, 2024

Futures

Up/Down

%

Last

Dow

330.00

0.84%

39,473

S&P 500

61.75

1.17%

5,328

Nasdaq

245.75

1.35%

18,425

 

 

U.S. futures gain as S&P (Spuz) +1.1% at 5,327.50, near the overnight highs and just below yesterday afternoon highs of 5,342 (the late day level hit before major averages saw a sell-off) amid a further rebound in Asian markets. U.S. futures are getting a bounce as the dollar strengthens against the Japanese yen (carry trade), rising 2% back to 147.26 after the yen strengthened below 142 just two days prior. The move in the yen comes following dovish signals from the Bank of Japan Deputy Governor Shinichi Uchida by pledging to refrain from hiking interest rates when the markets are unstable. The CBOE Volatility index (VIX) also extends losses, down -18% to 22.75 after falling -28% on Tuesday following its historic intraday spike to 65.73 on Monday as market fear eases. Main stock indexes rallied on Tuesday, as investors looked for bargains after a global stock selloff and dovish comments from Federal Reserve officials lifted market sentiment. The Dow Jones Industrial Average gained 0.8%, while the SPX, and Nasdaq composite both advanced over 1% – though all major averages finished at afternoon lows on a late day pullback that pared gains. All S&P 500 sectors rose with real estate posting the biggest rise. In Asian markets, The Nikkei Index gained 414 points to settle at 35,089, the Shanghai Index edged higher 2 points to 2,869, and the Hang Seng Index jumped 230 points to 16,877. In Europe, the German DAX is up 250 points to 17,600, while the FTSE 100 adds 83 points to 8,109. In corporate stock news, NVO shares slide after lowering guidance last night, semis mixed as group rises though SMCI falls -14% after results.

 

Market Closing Prices Yesterday

  • The S&P 500 Index jumped 53.70 points, or 1.04%, to 5,240.03.
  • The Dow Jones Industrial Average rose 294.39 points, or 0.76%, to 38,997.66.
  • The Nasdaq Composite gained 166.77 points, or 1.03%, to 16,366.86.
  • The Russell 2000 Index advanced 25.14 points, or 1.23% to 2,064.30.

Economic Calendar for Today

  • 7:00 AM ET MBA Mortgage Applications Data
  • 10:30 AM ET                Weekly DOE Inventory Data
  • 1:00 PM ET US Treasury to sell $39B in 10-year notes
  • 3:00 PM ET                   Consumer Credit for June

Earnings Calendar:

  • Earnings Before the Open: ACMR ASTE AVA CCO CEVA CNDT CRL CVS DBD DIN DIS DNOW DT DTC EDIT EHTH EMR EXTR EYE GEO GHM GOGO GPN HLLY HLT IEP ITCI JBI KMT LPX LQDA LYFT MDGL MMI MNKD NI NYT ODP OSCR PAYO PRKS RCM REYN RL RMBL ROK RXO SCPL SHO SMRT SUN SWTX TGNA TH VERX VSH VVV WMG WWW ZBH
  • Earnings After the Close: ACVA AIV ALEC AMPH AOSL APP APPS ASPN ASYS ATO AZEK BARK BHF BIRD BLBD BLNK BMBL BOOT BROS BYND CACI CDE CDXC CENT CF CHRD CLNE CORZ CPAY CPRX CSGS CW CXW DBRG DGII DHX DLB DOX DUOL EGHT ENS EQIX ESE ET FSLY FWRD GH GLAD GNK HCAT HI HMN HOOD HPP HUBS ICUI IONQ JAMF JOBY KAR KTOS KVYO KW LB LESL LNW LZ MCK MGNI MKSI MMS MNST MODG MQ MRCC MRO MTW NDLS NNBR NVST OCUL OM OXY PET PETQ PFMT PHX PIII PRI PXLW RAMP RC RDNT RGLD ROOT RYN SBGI SBRA SM SONO SPCE SRPT STAA TALO TPVG UHAL UPWK VSAT VZIO WBD WES WTS ZD ZG

Other Key Events:

  • JP Morgan 2024 Auto Conference, 8/6-8/8, in New York

 

 

Macro

Up/Down

Last

Nymex

0.92

74.12

Brent

0.98

77.46

Gold

2.80

2,434.40

EUR/USD

-0.0014

1.0916

JPY/USD

2.93

147.21

10-Year Note

+0.046

3.934%

 

World News

  • China’s exports grew at their slowest pace in three months in July, missing expectations and adding to concerns about the outlook for the vast manufacturing sector. Outbound shipments climbed 7.0% in July from the year earlier, as customs data showed a slower pace of growth than June’s 8.6% rise and missing forecasts of a 9.7% increase. Imports rose at a robust 7.2% rate, reversing a 2.3% decline in June and marking the strongest performance in three months. It also beat analysts’ expectations of a 3.5% rise.
  • Japan’s holdings of foreign securities fell by about $17 billion in July to $911 billion, the Finance Ministry reported Wednesday. The decline in foreign securities suggests Japanese authorities may have once again sold Treasuries to fund currency intervention, as they did in April and May.

Sector News Breakdown

Consumer

  • AirBnB (ABNB) Q2 EPS $0.86 vs. est. $0.92; Q2 revs $2.75B vs. consensus $2.73B; Q2 adjusted EBITDA $894M; guides Q3 revenue $3.67B-$3.73B, consensus $3.84B; Q2 gross booking value $21.2B vs estimate $21.3B; Q2 average daily rates $169.53, nights & experiences booked 125.1M; Q2 growth of gross nights booked on origin basis in expansion markets significantly outperformed core markets on average.
  • Grocery Outlet (GO) Q2 adj EPS $0.25 vs est. $0.20, adj EBITDA $67.9Mm on revs $1.129B vs est. $1.1B, comps +2.9%; guides FY sales $4.3-4.35B, comps about +3.5%, gr mgn about 30.5%, adj EBITDA $252-260Mm vs est. $253.94Mm and adj EPS $0.89-0.95 vs est. $0.92.
  • Jack in the Box (JACK) Q3 EPS $1.65 tops consensus $1.51; Q3 revs $369.2M vs. consensus $371.1M; Q3 same-store sales decreased 2.2% in Q2, comprised of franchise same-store sales decline of 2.4% and company-owned same-store sales increase of 0.1%; sees FY24 EPS $6.10-$6.25 vs. consensus $6.30.
  • Lyft (LYFT) Q2 EPS $0.01 vs. consensus $0.19; Q2 revs $1.44B vs. consensus $1.39B; Q2 gross bookings of $4B, up 17% y/y and forecasts Q3 gross bookings between $4.0 billion and $4.1 billion vs estimates of $4.13B; sees FY24 rides growth in mid-teens year-over-year.
  • Maplebear; aka Instacart (CART) Q2 EPS $0.20 vs. est. $0.13 on revs $823mM vs. est. $806.6mM, GTV $8.19B vs est. $8.11B; sees Q3 GTV $8.10-8.25B vs est. $8.1B and adj EBITDA $205-215Mm vs est. $204.6Mm.
  • Rivian Automotive (RIVN) Q2 EPS loss (-$1.46) vs. consensus loss (-$1.21); Q2 revs $1.158B vs. est. $1.13B; announced technology JV With Volkswagen Group with a total deal size of up to $5B; has seen its order backlog fall in the recent quarters as deliveries increased and some customers canceled their reservations; maintained its production forecast for the year; posted a net loss of $1.46 billion vs. $1.2B loss y/y; ended the Q2 with $5.8 billion in cash and cash equivalents compared with $7.9 billion at the end of calendar year 2023.
  • VF Corp. (VFC) Q1 adj EPS ($0.33) vs est. ( $0.37) on revs $1.9B vs est. $1.847B, gr mgn 52%; guides FY FCF plus proceeds from non-core physical asset sales approx $600Mm.
  • Wynn Resorts (WYNN) Q2 adj EPS $1.12 vs est. $1.14, adj EBITDA $571.7Mm vs est. $555.6Mm on revs $1.73B vs est. $1.752B.

Energy,

  • Devon Energy (DVN) Q2 EPS $1.41 vs. consensus $1.16; Q2 oil production reached an all-time high of 335,000 barrels per day, exceeding guidance by 3%; total companywide production averaged 707,000 oil-equivalent barrels (Boe) per day in Q2, up 7% y/y; buyback program extended to $5B; sees 2024 capex $3.3B-$3.6B.
  • Permian Resources (PR) Q2 crude oil and total average production of 152.9 MBbls/d and 338.8 MBoe/d during the quarter; Increased mid-point of full year standalone oil and total production guidance by 1.5% to 152 MBbls/d and 325 MBoe/d, driven primarily by continued strong operational performance.
  • SolarWinds Corp. (SWI) will replace SunPower Corp. (SPWR) in the S&P Smallcap 600 effective prior to the market opening on August 9.
  • SunRun (RUN) Q2 revs $523.9M vs. est. $515.2M; Annual Recurring Revenue from Subscribers was approximately $1.5B as of June 30, 2024; has expanded its support for energy grid in Texas with a partnership with Tesla (TSLA); introducing cash generation guidance of $350M-$600M in 2025.

Financials

  • Reddit (RDDT) Q2 revs $281.2M vs. est. $253.6M; Q2 adj Ebitda $39.5M vs. est. $13.2M; sees Q3 revenue $290M-$310M, vs. consensus $278.69M and sees Q3 adjusted EBITDA $40M-$60M; Q2 Daily Active Unique increased 51% y/y to 91.2 million and weekly active uniques increased 57% y/y to 342.3 million.
  • Redfin (RDFN) Q2 EPS loss (-$0.23) vs. est. loss (-$0.26); Q2 revs rose 7% y/y to $295.2M vs. consensus $291.59M; Q2 Gross profit was $109.6 million, an increase of 9% y/y and real estate services gross profit was $53.7 million, a decrease of 4% y/y; sees Q3 loss $30M-$22M loss and revs $273M-$285M vs. est. $295.7M.
  • Toast Inc. (TOST) Q2 EPS $0.02 vs. est. loss (-$0.02); Q2 revs $1.24B vs. est. $1.22B; Added approximately 8,000 net new Locations in Q2 and annualized recurring run-rate (ARR) as of June 30, 2024 grew 29% to $1.5B; Q2 Gross Payment Volume (GPV) increased 26% year over year to $40.5B; raises FY24 adjusted EBITDA view to $285M-$305M from $250M-$270M.
  • Upstart Holdings (UPST) Q2 EPS loss (-$00.17) vs. est. loss (-$0.39); Q2 revs $130.5M vs. est. $124.3M; sees Q3 revenue roughly $150M vs. consensus $135.36M; Q2 Transaction Volume and Conversion Rate 143,900 loans were originated, totaling $1.1B across platform, down 6% from the same quarter of the prior year.

Healthcare

  • Acadia Pharmaceuticals (ACAD) Q2 EPS $0.20 vs. est. $0.18; Q2 revs $242.0M vs. est. $235.4M; for Q2 sales highlighted by 11% y/y growth in NUPLAZID net sales and 11% sequential growth in DAYBUE net sales; net product sales guidance is increased to a range of $590M-$620M from $560M-$590M; narrows FT 24 overall revs.
  • ADC Therapeutics (ADCT) files $300M mixed securities shelf.
  • Amgen Inc. (AMGN) Q2 adj EPS $4.97 vs. consensus $5.01; Q2 revs $8.394B, consensus $8.33B; guides FY adj EPS $19.10-$20.10, vs. prior $19-$20.20 (est. $19.51); guides FY revs $32.8B-$33.8B, from prior $32.5B-$33.8B (shares were downgraded to EW from OW at Wells Fargo).
  • CVS Corp. (CVS) lowers its FY24 adj EPS to $6.40-$6.65, from prior forecast at least $7 (est. $6.97); had reported Q2 adj EPS $1.83 vs. est. $1.73 and revs $91.2B vs. est. $91.5B.
  • DaVita (DVA) Q2 adj EPS $2.59 vs. consensus $2.54; Q2 revs rose 6.2% y/y to $3.19B vs. consensus $3.15B; boosts FY24 adjusted EPS view to $9.25-$10.05 from $9.00-$9.80 (est. $9.32) and raises FY24 free cash flow view to $950M-$1.2B from $900M-$1.15B.
  • G1 Therapeutics, Inc. (GTHX) entered into a definitive merger agreement under which Pharmacosmos A/S, through its U.S. subsidiary Pharmacosmos Therapeutics Inc., will acquire all outstanding shares of G1 Therapeutics common stock for U.S. $7.15 per share in cash for a total equity value of approximately $405 million.
  • Illumina (ILMN) Q2 adj EPS $0.36 vs. est. $0.90; Q2 adj net income $57M vs. est. $141.6M; sees FY core Illumina revenue to decline 2% to 3% and FY EPS $3.80-$3.95 vs. est. $3.91.
  • Inspire Medical Systems (INSP) Q2 EPS $0.32 vs est. ($0.14) on revs $195.9Mm vs est. $189.46Mm, gr mgn 84.8%; guides FY revs $788-798Mm vs prior $783-793Mm and est. $789.69Mm, gr mgn 83-85%, EPS $0.60-0.80 vs prior $0.10-0.20 and est. $0.16; announces $150m share buyback.
  • Masimo Corp. (MASI) Q2 adj EPS $0.86 vs est. $0.76 on revs $496.3Mm vs est. $493.56Mm; guides FY revs $2.085-2.135B vs est. $2.098B and adj EPS $3.80-4.00 vs est. $3.62.
  • Novo Nordisk (NVO) lowered its operating profit guidance to 20% to 28%, down from the 22%-30% prior; while raised its sales forecast for the year to 22%-28% from prior 19%-27%.
  • STERIS Plc (STE) Q1 adj EPS $2.03 vs est. $1.98 on revs $249.8Mm vs est. $1.272B; sees FY revs +6.5-7.5% vs est. +6.88% and adj EPS $9.05-9.25 vs est. $9.14.

Industrials and Materials

  • Axon Enterprises (AXON) Q2 adj EPS $1.20 vs est. $1.02, adj EBITDA $123Mm vs est. $101.3Mm on revs $504Mm vs est. $478Mm; guides FY revs $2.0-2.05B vs est. $1.982B and adj EBITDA $430-445Mm vs est. $441.42Mm.
  • Internation Flavors & Fragrances (IFF) Q2 adj EPS $1.16 vs. est. $1.01; Q1 revs $2.89B vs. est. $2.83B; Q2 Ebitda $588M vs. est. $532.1M; is increasing its FY24 expectations for sales to be in the range of $11.1B-$11.3B from prior $10.8B-$11.1B and adj operating EBITDA $2.1B-$2.17B from $1.9B-$2.1B and volume 3%-5% vs. 0%-3%.
  • Mosaic (MOS) Q2 adj EPS $0.54 vs est. $0.66, adj EBITDA $584Mm vs est. $601.5Mm on revs $2.8B vs est. $2.934B; sees Q3 sales volumes 2.1-2.3Mm tons and MOP prices $200-220/ton.
  • Trex Co (TREX) Q2 EPS $0.80 vs est. $0.78, EBITDA $130.355Mm vs est. $127.87Mm on sales $367.47Mm vs est. $387.86Mm; sees Q3 revs $220-230Mm vs est. $290.45Mm; sees FY revs $1.13-1.15B vs est. $1.242B and EBITDA mgn 30.0-30.5%.

Technology, Media & Telecom

  • Astera Labs (ALAB) Q2 EPS $0.13 vs. est. $0.11; Ad adj net income $22.2M vs. est. $22.8M; Q2 revs $76.9M vs. est. $72.46M; Q2 gross margin 77.9%.
  • Cirrus Logic (CRUS) Q1 adj EPS $1.12 vs est. $0.61 on revs $374Mm vs est. $318.7Mm; sees Q2 revs $490-550Mm vs est. $484.56Mm.
  • Fortinet (FTNT) Q2 adj EPS $0.57 vs est. $0.41 on revs $1.43B vs est. $1.403B, adj op mgn 35.1%; sees Q3 revs $1.445-1.505B, billings $1.53-1.6B, adj gr mgn 79-80%, adj op mgn 30.5-31.5%, adj EPS $0.56-0.58 vs est. $0.43; guides FY revs $5.8-5.9B vs est. $5.793B, service revs $3.975-4.025B, billings $6.4-6.6B, adj gr mgn 79-80%, adj op mgn 30.5-31.5%, adj EPS $2.13-2.19 vs est. $1.76.
  • Super Micro Computer (SMCI) announces 10 for 1 stock split; Q4 adj EPS $6.25 below consensus $8.07 and Q4 revenue $5.31B in-line with consensus $5.3B; guides Q1 adjusted EPS $6.69-$8.27 vs. consensus $7.58 and Q1 sales $6B-$7B vs. est. $5.46B; sees FY25 revenue $26B-$30B vs. consensus $23.62B; said gross margin of 11.2% versus 15.5% in the third quarter of fiscal year 2024 and 17.0% in the same quarter of last year.
  • Certara Inc. (CERT) Q2 adj EPS $0.07 vs est. $0.10, adj EBITDA $26.3Mm vs est. $29.6Mm on revs $93.3Mm vs est. $96.1Mm; sees FY revs $385-400Mm vs est. $390.95Mm, adj EBITDA mgn 31-33%, adj EPS $0.41-0.46 vs est. $0.44.
  • Coupang (CPNG) Q2 EPS ($0.04) vs est. ($0.01), EPS $0.07 ex Farfetch and fine, adj EBITDA $330Mm vs est. $229.4Mm, adj EBITDA $361Mm ex Farfetch on revs $7.3B vs est. $7.375B.
  • Lumen Technologies (LUMN) Q2 adj EPS ($0.13) vs est. ($0.06), adj EBITDA $1.01B vs est. $1.02B; sees FY adj EBITDA $3.9-4.0B vs prior $4.1-4.3B and est. $4.038B, FCF $1.0-1.2B vs prior $100-300Mm.
  • Qualys (QLYS) Q2 adj EPS $1.52 vs est. $1.32, adj EBITDA $69.9Mm and adj op Inc $65.9Mm vs est. $58.7Mm on revs $148.7Mm vs est. $148.7Mm; sees Q3 revs $149.8-151.8Mm vs est. $153.71Mm and adj EPS $1.28-1.38 vs est. $1.27; sees FY revs $597.5-601.5Mm vs est. $605.64Mm and adj EPS $5.46-5.62 vs est. $5.26.

_________________________________________________________________

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.

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