Early Look

Wednesday, December 11, 2024

U.S. futures are looking mixed, with the Nasdaq bouncing back along with S&P, but things can change quickly around 8:30 AM when key monthly inflation data is released. Stocks slipped on Tuesday while bonds and the dollar saw small moves, with traders unwilling to make any significant bets before key CPI inflation data expected later this morning at 8:30 AM. Month-over-month CPI for November is forecast to tick slightly higher to 0.3% from 0.2% in October, with the core y/y reading keeping at 3.3% for the third straight month, well above the Fed’s 2% target rate. In Asian markets, The Nikkei Index edged higher 4 points to 39,372, the Shanghai Index rose 9 points to 3,432, and the Hang Seng Index fell -156 points to 20,155. In Europe, the German DAX is up about 8 points to 20,337, while the FTSE 100 is up about 10 points to 8,290. The dollar strengthened after a report that Chinese leaders are considering allowing their currency to weaken as they brace for higher tariffs under a second Donald Trump presidency. The USD/JPY pair climbed after Bloomberg reported BOJ officials see little cost to waiting before raising interest rates.

• The Dow Jones Industrial Average fell -154.10 points, or 0.35%, to 44,247.83.
• The Nasdaq Composite dropped -49.45 points, or 0.25%, to 19,687.24.
• The Russell 2000 Index declined -10.06 points, or 0.42% to 2,382.77.

• 8:30 AM ET                  Consumer Price Index (CPI) headline M/M for November…est. +0.3% (prior +0.2%)
• 8:30 AM ET                  Consumer Price Index (CPI) headline Y/Y for November…est. +2.7% (prior +2.6%)
• 8:30 AM ET                  Core CPI (ex: food & energy) M/M for November…est. +0.3% (prior +0.3%)
• 8:30 AM ET                  Core CPI (ex: food & energy) Y/Y for November…est. +3.3% (prior +3.3%)
• 10:30 AM ET                Weekly DOE Inventory Data
• 11:00 AM ET                Cleveland Fed CPI for November
• 1:00 PM ET U.S. Treasury to sell $42B in 10-year notes
• 2:00 PM ET                   Federal budget for November…est. (-$353B)

• Earnings After the Close: ADBE JILL KEQU NDSN OXM

• Goldman Sachs U.S. Financial Services Conference 2024, 12/10-12/11, in New York
• Oppenheimer Midwest Industrial Summit, 12/11-12/12
• Raymond James TMT and Consumer Conference, 12/9-12/11, in New York
• Roth MKM 13th Annual Deer Valey event 12/11-12/14, in Park City, Utah

• Dave & Busters (PLAY) Q3 adj EPS ($0.45) vs est. ($0.37), adj EBITDA $68.3M vs est. $73.9M on revs $453M vs est. $465.54M, comps -7.7%; also announced CEO transition (Chris Morris resigned, Kevin Sheehan to serve as interim).
• GameStop (GME) Q3 adj EPS $0.06 vs. est. loss (-$0.06); Q3 revs $860.3M vs. est. $887.7M; Q3 Hardware and Accessories net sales fell -28% y/y to $417.4M and software sales -15% y/y to $271.8M.
• Lowes’ (LOW) sees adjusted EPS $11.80 to $11.90 (est. $11.90); still sees total sales $83.0B to $83.5B (est. $83.3B), still sees adjusted operating margin 12.3% to 12.4%, still sees comparable sales -3% to -3.5% (est. -3.35%) and still sees capital expenditure about $2B.
• Krispy Kreme (DNUT) said it was notified in November regarding unauthorized activity on a portion of its IT systems; adds operational disruptions are ongoing, including online ordering in parts of U.S.
• Sportsman Warehouse (SPWH) Q3 adj EPS $0.04 vs est. ($0.02), adj EBITDA $16.4Mm vs est. $12.82Mm on revs $324.261Mm vs est. $300.48Mm; sees FY net sales $1.18-1.20B vs est. $1.147B, adj EBITDA $23-29Mm vs est. $24.92Mm and CAPEX $17-20Mm.
• Stitch Fix (SFIX) Q1 EPS ($0.05) vs est. ($0.14), adj EBITDA $13.5Mm vs est. $7.42Mm on revs $318.8Mm vs est. $306.93Mm; guides Q2 revs $290-300Mm vs est. $283.53Mm and adj EBITDA $8-13Mm vs est. $4.314Mm; sees FY revs $1.14-1.18B vs est. $1.144B and adj EBITDA $25-36Mm vs est. $22.93Mm.

• GE Vernova (GEV) shares slipped as the company’s chief executive officer said he was cautious about the outlook for its wind sector even though it had resumed installing turbines at two offshore wind farms.
• JOBY Aviation (JOBY) in equity distribution pact for $300M of stock.
• Landstar System Inc (LSTR) declares a special one-time cash dividend of $2.00 per share.

• Coastal Financial (CCB) 1.2M share Spot Secondary priced at $71.00.
• Cousins Properties (CUZ) announces a 9.5M share common stock offering.
• Victory Capital Holdings, Inc. (VCTR) reported Total Assets Under Management (AUM) of $179.7 billion, Other Assets of $4.3 billion, and Total Client Assets of $184.0 billion, as of November 30, 2024.
• Voya Financial (VOYA) downgraded to Neutral from Buy at Bank America.
• Western Alliance Bancorp (WAL) said CEO Kenneth Vecchione is taking medical leave, and that CFO Dale Gibbons is appointed interim CEO.

• Figs (FIGS) has received an acquisition bid from private equity firm Story3 Capital Partners that values the medical-apparel maker at over $1B, the WSJ reported. The firm offered $6 per share for the common shares of Figs that it does not already hold https://tinyurl.com/3em32be5
• Q32 Bio Inc. (QTTB) shares tumbled as announced topline results from the SIGNAL-AA Phase 2a signal finding clinical trial evaluating bempikibart, or ADX-914; while the results from its Signal-AD trial in atopic dermatitis demonstrated promising findings in Part A but didn’t meet primary endpoint in Part B.
• Relay Therapeutics (RLAY) said its lead drug candidate to treat a type of locally advanced breast cancer, RLY-2608, helped patients live for about 11.4 months on average without the disease getting worse.
• Rocket Pharmaceuticals (RCKT) announces $150M common stock offering.
• Spruce Biosciences (SPRB) announced topline results from its CAHmelia-204 study of tildacerfont in adult CAH and its CAHptain-205 study of tildacerfont in adult and pediatric CAH. The clinical trial did not achieve the primary efficacy endpoint of the absolute change in daily GC dose from baseline at week 24.
• In MedTech, Citigroup upgraded GKOS to Buy, downgrading BLCO and LUNG to Neutral and Neutral/High Risk, opening a Positive Catalyst Watch on ZBH, and entering 2025 with Top Picks: BSX (Farapulse, Watchman; adding to Citi Focus List) and PODD (type 2 opportunity), removing GEHC (China headwinds).
• In Life Sciences, Citigroup upgraded QDEL to Buy and MTD to Neutral, and downgraded ILMN and FTRE to Neutral. Citi said heading into 2025, investor appetite for Tools/CROs remains light from conversations, however it sees pockets of areas to be more constructive such as bioprocessing where the recovery is underway.

• Skillsoft (SKIL) Q3 EPS loss (-$1.82) vs. est. loss (-$3.00); Q3 revs $137.2M vs. est. $130M; raises FY25 revenue view to $520M-$530M from $510M-$525M while affirms FY25 adjusted EBITDA view of $105M-$110M.
• China’s top markets watchdog summoned PDD Holdings Inc. (PDD) executives to order the company to fix its refunds-first policy. The State Administration of Market Regulation and Ministry of Commerce told executives at a recent meeting that the policy placed an unfair burden on small merchants.