Early Look
Wednesday, May 4, 2022
|
Futures |
Up/Down |
% |
Last |
|
Dow |
109.00 |
0.33% |
33,142 |
|
S&P 500 |
15.25 |
0.37% |
4,184 |
|
Nasdaq |
32.50 |
0.25% |
13,120 |
U.S. futures are near the overnight highs of 4,188, up 0.4% after trading in a narrow range overnight (low 4,167.75) ahead of today’s Federal Reserve policy meeting at 2:00 PM ET, followed by a conference with chair Jerome Powell 30 minutes later. The Fed is fully expected to raise interest rates 50bps later today, as well as detail plans for the reduction of its balance sheet (with a small chance for a larger rate hike, though unlikely at this point) as the central bank ramps up its efforts to bring down high inflation. Oil prices are rising over 3% on reports the European Union intends to ban Russian crude imports over the next six months and refined fuels by year-end. Choppy markets on Tuesday ended with solid gains for major averages as the Dow rose over 1% and the Smallcap Russell 2000 advanced over 0.85% as investors await the Federal Reserve policy meeting later this afternoon. In Asian markets, The Nikkei Index remained closed along with the Shanghai Index while the Hang Seng Index fell -1.1% to 20,869. In Europe, the German DAX is lower by about -30 points to 14,000, while the FTSE 100 is down over -30 points to 7,525. Oil prices rising over 3% on reports the European Union intends to ban Russian crude imports over the next six months and refined fuels by year-end. Several high-profile corporate earnings results moving stocks/sectors overnight: to the upside (ABNB, AMD, LTHM, SBUX) and to the downside (AKAM, LYFT, RVLV, SWKS), and lots of economic data to chew on (ADP Employment, Trade Balance, S&P Manufacturing, and ISM services data) but market action likely focusing on the Fed later today.
Market Closing Prices Yesterday
· The S&P 500 Index climbed 20.10 points, or 0.48%, to 4,175.48
· The Dow Jones Industrial Average rose 67.29 points, or 0.20%, to 33,128.79
· The Nasdaq Composite gained 27.74 points, or 0.22%, to 12,563.76
· The Russell 2000 Index advanced 15.94 points, or 0.85% to 1,898.86
Economic Calendar for Today
· 7:00 AM ET MBA Mortgage Applications Data
· 8:15 AM ET ADP Employment Change for April
· 8:30 AM ET International Trade Balance for March
· 9:45 AM ET S&P Global Comp PMI, Apr-F
· 9:45 AM ET S&P Global Services PMI, Apr-F
· 10:00 AM ET ISM Non-Manufacturing Index for April
· 10:30 AM ET Weekly DOE Inventory Data
· 2:00 PM ET FOMC Rate Meeting, 50-bps interest rate hike expected
Earnings Calendar:
· Earnings Before the Open: ABC, ASTE, ATI, BCOR, BDC, BHG, BRKR, BWA, CDW, CLDT, CLH, CRL, CSII, CVS, DIN, DOC, EAT, EDIT, EMR, FDP, FUN, GEL, GNRC, GTES, HZNP, IDXX, JCI, LITE, LL, LNG, MAR, MFA, MUR, NBIX, NI, NYT, ODP, PCRX, PNW, REGN, ROCK, SBGI, SITE, SPR, STWD, SUN, SUP, TECH, TUP, VMC, WING, YUM
· Earnings After the Close: ACAD, ACLS, ADPT, ADTN, AEIS, AEL, ALB, ALL, ANSS, APA, ATO, AXGN, BAND, BHR, BKNG, CASA, CCMP, CDAY, CENT, CF, CHK, CLR, CPE, CTSH, CTVA, CW, CXW, DCP, DHX, DIOD, DOCN, EBAY, EMKR, EPR, ES, ET, ETSY, EVH, FATE, FLEX, FSLY, FTNT, GBT, GDDY, GKOS, GXO, HCI, HEAR, HST, INSG, IR, IRBT, KD, KW, LGND, LHCG, LNC, LSI, LUMN, MANT, MARA, MDU, MET, MGNI, MMS, MRO, MTG, NGVT, NUVA, NVRO, O, OAS, OM, PAA, PACB, PAHC, PAY, PETQ, PNNT, PXD, QDEL, QLYS, ARVO, RCII, RGR, RPT, RUN, RYI, RYN, SBRA, SFM, SHO, SUM, TALO, TNDM, TPVG, TRIP, TWLO, TWNK, UBER, UPLD, VMEO, WOLF
Other Key Events:
· Association for Research in Vision & Ophthalmology (ARVO), 5/1-5/4, in Denver, CO
· BMO Capital Global Reserve & Asset Managers Conference, 5/3-5/6, in Toronto
· DA Davidson Annual Financial Institutions Conference, 5/4-5/6, in Colorado
· Oppenheimer Annual Industrial Growth Conference (virtual), 5/3-5/4
· Piper Spring Biotech Symposium, 5/3-5/5, in Boston, MA
· China Caixin Services PMI for April
|
Macro |
Up/Down |
Last |
|
Nymex |
3.69 |
106.10 |
|
Brent |
3.60 |
108.57 |
|
Gold |
-0.10 |
1,870.50 |
|
EUR/USD |
0.0005 |
1.0526 |
|
JPY/USD |
-0.09 |
130.01 |
|
10-Year Note |
-0.002 |
2.956% |
World News
· Fitch Ratings cuts its GDP growth forecast for China to 4.3% from 4.8% for 2022, on the assumption that Beijing’s strict stance on Covid-19 will remain in place this year. Fitch expects an on-quarter GDP contraction in the second quarter,
· Australia S&P Services and Composite PMI’s came in a touch softer than expected at 56.1% & 55.9%, respectively. Retail sales data for March was strong, rising 1.6% vs 0.5% expected. Home loans data for March was also strong, along with improved revisions to previous months fall
Sector News Breakdown
Consumer
· Caesar’s Entertainment (CZR) Q1 EPS loss (-$2.11) vs. est. loss (-$2.11); Q1 revs $2.3B vs. est. $2.34B; Q1 same-store adjusted EBITDA $296M vs. $521M last year; Same-store Adjusted EBITDA, excluding our Caesars Digital segment, of $850M vs. $530M Y/Y
· Lyft (LYFT) Q1 adj EPS $0.07 vs. est. loss (-$0.07); Q1 revs $875.4M vs. est. $846M; qtrly active riders 17.8 mln, up 31.9%; qtrly revenue per active rider $49.18, up 9%; Adjusted EBITDA for Q1 2022 was $54.8 million, an improvement of $127.8 million Y/Y; says experienced strong rebound in demand in February and March in rideshare rides; forecast Q2 adj EBITDA of $10M-$20M and Q2 revs of $950M-$1B vs. est. $1.02B (shares originally rose on Q1 Ebitda beat of $54.8M vs. prior guide $5M-$15M)
· Starbucks (SBUX) 2Q adj EPS $0.59 vs est. $0.59 on revs $7.64B vs est. $7.64, comps +7% (+12% US, +double-digit international ex China, -8% international reported, -23% China); suspends guidance for the rest of the year
· Big 5 Sports (BGFV) shares fall -8%; Q1 EPS $0.41 vs. est. $0.37; Q1 sales $242M in-line with estimates; said Q1 comp sales fell -11.4%; sees Q2 EPS $0.40-$0.50
· Denny’s (DENN) 1Q adj EPS $0.11 vs est. $0.13 on revs $103.1Mm vs est. $102.5Mm; system-wide comps +23.3% (+22.8% domestic franchised and +30.6% at company units); guides 2Q domestic system-wide comps +3-5%, adj EBITDA $17-19Mm (incl $4Mm related to cash payments for share-based comp) vs est. $25.4Mm
· DiDi Global (DIDI) disclosed in a regulatory form Tuesday that the SEC had contacted the company and made inquiries about the IPO, according to an annual report filed with U.S. regulators. DiDi is cooperating with the probe
· Camping World Holdings (CWH) Q1 EPS $1.15 vs. est. $1.38; Q1 revs rose 6.7% to $1.70B vs. est. $1.64B; Q1 adjusted EBITDA was $182.1M, a decrease of $7.2M, or 3.8%; new and used vehicle inventories were $1.8 billion, an increase of $938.3M
· Red Rock Resorts (RRR) Q1 EPS $0.77 vs. est. $0.67; Q1 revs $410.6M vs. est. $406.5M; Adjusted EBITDA was $178.7M for the Q1, an increase of 14% or $22.1M
· Freshpet (FRPT) 4.32M share Secondary priced at $81.00
· Revolve Group (RVLV) 1Q EPS $0.30 vs et $0.27 on sales $283.5Mm vs est. $255.9Mm
· Yum China (YUMC) 1Q adj EPS $0.24 vs est. $0.31 on revs $2.67B vs est. $2.63B; says generated operating profit for 1Q but experienced a loss for month of March; unless covid situation improves significantly in May and June, will expect to incur and operating loss for 2Q; FY targets unchanged
Energy
· Comstock Resources (CRK) Q1 adj EPS $0.51 vs. est. $0.49; Q1 revs $407.7M vs. est. $411.8M; Q1 production cost per Mmcfe was $0.69 per Mmcfe, which was comprised of $0.28 for gathering and transportation costs, $0.23 for lease operating costs, $0.12 for production and other taxes and $0.06 for cash general and administrative expenses
· Edison International (EIX) Q1 core EPS $1.07 vs. est. $0.81; Q1 revs $3.97B vs. est. $3.32B; affirms 2022 eps guidance of $4.40–4.70 and long-term eps growth rate target of 5–7%
· ONEOK (OKE) 1Q adj EBITDA $863.9Mm vs est. $873Mm; affirms FY guidance
· ProPetro Holding (PUMP) Q1 EPS $0.20 vs. est. $0.06; Q1 revs $283M vs. est. $273.67M; Q1 adj EBITDA increased 81% to $67 million or 24% of revenues compared to $37 million Q/Q; effective utilization for the first quarter improved 9.6% to 13.7 fleets compared to 12.5 fleets for the fourth quarter of 2021 without expanding marketed fleet count.
· Patterson-UTI (PTEN) reported that for the month of April, the company had an average of 118 drilling rigs operating in the United States
Financials
· AIG Inc. (AIG) boosts share buyback authorization to $6.5 billion; Q1 adj EPS $1.30 vs. est. $1.18; qtrly general insurance net premiums written $6.6 billion, up 2%; general insurance underwriting income $446 mln vs $73 mln; book value per common share was $69.30 as of March 31, 2022; ROE and adjusted ROCE were 28.1% and 7.6%, respectively, on an annualized basis for q1
· Extra Storage Space (EXR) 1Q FFO/shr $2.01 vs est. $1.87; guides FY core FFO/shr $8.05-8.30 vs est. $7.93
· Jack Henry & Associates (JKHY) 3Q EPS $1.16 vs est. $1.06 on revs $478.3Mm vs est. $475.4Mm; sees FY EPS $4.80-4.85 vs est. $4.81 and adj revs $1.889-1.892B vs est. $1.936B
· NerdWallet (NRDS) 1Q EPS ($0.16) vs est. ($0.14) on revs $129.1Mm vs est. $123.7Mm; guides 2Q revs $118-121Mm vs est. $114.5Mm
· Paycom Software (PAYC) 1Q adj EPS $1.90 vs est. $1.75 on revs $354Mm vs est. $343Mm; sees 2Q revs $308-310Mm vs est. $301Mm and FY revs $1.333-1.335B vs est. $1.315B
· Prudential (PRU) Q1 adjusted EPS $3.17 vs. est. $2.70; 1Q book value per common shr $115.28; Q1 adjusted book value per common shr $107.16; Assets Under Management of $1.620 Trillion
· Radian (RDN) Q1 adj EPS $1.17 vs. est. $0.76; Q1 revs $292.98M vs. est. $242.57M; said net income Y/Y to $181 million, return on equity to 17.2% and book value per share to $23.75
· Voya Financial (VOYA) Q1 adj EPS $1.47 vs. est. $1.44; authorizes $500M stock buyback; as of March 31, approximately $900m of excess capital, including approximately $100m generated in the Q1
Healthcare
· AmerisourceBergen (ABC) Q2 adj EPS $3.22 vs. est. $2.93; Q2 revs $57.7B vs. est. $57.27B; raises FY22 adjusted EPS view to $10.80-$11.05 from $10.60-$10.90 (est. $10.79); sees adjusted operating income to grow at least in the high-teens percent range, up from growth in the high-teens percent range
· CVS Health (CVS) Q1 adj EPS $2.22 vs. est. $2.15; Q1 revs $76.83B vs. est. $75.39B; raises year EPS forecast to $8.20-$8.40 from prior $81.0-$8.30 (est. $8.27) while reaffirms cash flow from operations of $12B-$13B
· Masimo Corp (MASI) 1Q adj EPS $0.93 vs est. $0.87 on revs $304.2Mm vs es.t $303.8Mm; guides 2Q revs $525-555Mm vs est. $385.6Mm and adj EPS $1.13-1.25; sees FY revs $2.0-2.06B vs est. $1.6B and adj EPS $4.46-4.73 vs est. $4.16
· Owens & Minor (OMI) Q1 EPS $0.96 vs. est. $0.82; Q1 revs $2.41B vs. est. $2.31B; guides FY22 EPS $3.05-$3.55 vs. est. $3.43 and sees FY22 revenue $9.9B-$10.3B vs. est. $9.85B
· PerkinElmer (PKI) 1Q adj EPS $2.41 vs est. $2.08 on revs $1.26B vs est. $1.18B; guides 2Q adj EPS $2.00-2.05 vs est. $1.69 and revs about $1.2-1.22B vs est. $1.1B; sees FY adj EPS $7.15-7.45 vs est. $7.00 and revs $4.56-4.63B vs est. $4.48B
· PTC Therapeutics (PTCT) Q1 EPS loss ($1.78) vs. est. loss ($1.51); Q1 revs $148.7M vs. est. $147.06M; cash, cash equivalents, and marketable securities were $587.8M on March 31, compared to $773.4M at December 31; sees FY22 revs $700M-$750M vs. est. $721M
Industrials & Materials
· Generac (GNRC) Q1 adj EPS $2.09 vs. est. $1.94; Q1 revs rose 41% to $1.14B vs. est. $1.09B; raises FY22 revenue growth view to 36%-40% from 32%-36% while sees adjusted EBITDA margin, before deducting for non-controlling interests, to about 21.5 to 22.5% as compared to the previous expectation of approximately 22.0 to 23.0%.
· Livent (LTHM) Q1 adj EPS $0.21 vs. est. $0.14; Q1 revs $143.5M vs. est. $140.15M; Q1 adj EBITDA was $53.3M, up 94% Q/Q; boosts FY22 revenue view to $755M-$835M from $540M-$600M and raises adjusted EBITDA view to $290M-$350M from $160M-$200M.
· Manitowoc (MTW) Q1 EPS $0.03 vs. est. $0.04; Q1 sales rise 29.6% to $459M vs. est. $441.8M; said while revenue was lower than planned mainly due to continuing supply chain and logistics challenges, the team was able to generate $31 million of Adjusted EBITDA
· Werner Enterprises (WERN) Q1 EPS $0.96 vs. est. $0.86; Q1 revs rose 24% to $764.6M vs. est. $746.3M; Operating margin of 10.9%, up 80 bps; non-GAAP adjusted operating margin of 11.3%, up 110 bps
Internet, Media & Telecom
· AirBnB (ABNB) adj EBITDA $229Mm vs est. $73.9Mm on revs $1.5B vs est. $1.45B; gross nights booked +32%; gross bookings value $17.2B +67%; guides 2Q ADR flat, revs $2.03-2.13B vs est. $1.96B; says seeing higher than historical demand for 4Q, indicating Consumer Confidence to travel remains strong beyond summer months
· Match Group (MTCH) Q1 1 revs $799M vs. est. $794.2M; sees Q2 revs $800M to $810M, vs. est. $835.2M; 1Q adj operating income $273Mm vs est. $211Mm on revs $799Mm vs est. $794.2Mm
Semiconductors
· Advanced Micro Devices (AMD) 1Q adj EPS $1.13 vs est. $0.91 on revs $5.8B vs est. $5.5B; gross margin 48%; guides 2Q revs $6.3-6.7B vs est. $6.4B and FY revs $26.3B vs est. $25.15B
· Cirrus Logic (CRUS) Q4 adj EPS $2.01 vs. est. $1.40; Q4 revs $490M vs. est. $420.29M; sees Q1 revenue $350M-$390M above est. $300M; sees Q3 GAAP gross margin is forecasted to be between 49%-51%
· Lattice Semiconductor (LSCC) 1Q adj EPS $0.37 vs est. $0.33 on revs $150.5Mm vs est. $146.2Mm, adj gross margin 67.7%; sees 2Q revs $153-163Mm vs est. $150.5Mm, sees gross margin 67-69% and adj op exp $48-50Mm
· Skyworks Solutions (SWKS) Q1 adj EPS $2.63, in-line with estimates; Q1 revs $1.34B vs. est. $1.33B; sees Q2 adjusted EPS $2.36 vs. est. $2.55; sees Q3 revs $1.2B-$1.26B vs. est. $1.3B
Technology
· A10 Networks (ATEN) 1Q EPS $0.13 vs est. $0.11 on revs $62.7Mm vs est. $60.95Mm
· Akami (AKAM) Q1 non-GAAP EPS $1.39 vs. est. $1.42; Q1 revs $904M vs. est. $903.89M; qtrly security revenue of $382 mln, up 23% Y/Y; qtrly compute revenue of $78 mln, up 32% Y/Y
· Alteryx (AYX) 1Q adj EPS ($0.40) vs est. ($0.59) on revs $158Mm vs est. $145.9Mm; Sees Q2 revenue $159M-$162M vs. est. $156.53Mand sees Q2 ARR $718M-$721M, representing year-over-year growth of 31% to 32%
· Infinera Corp. (INFN) Q1 EPS loss (-$0.07) vs. est. loss (-$0.04); Q1 revs $338.9M vs. est. $361.7M; sees Q2 revs $350M plus/minus $20m vs. est. $379.9M; suspension of operations in Russia in q1, supply chain impact from delayed customer project completions, elevated costs muted revenue, margin
· MicroStrategy (MSTR) Q1 EPS loss (-$11.58) and revs fell -2.9% to $119.3M vs. est. $127.2M; the carrying value of MicroStrategy’s digital assets (comprised of approximately 129,218 bitcoins) was $2.896 billion, which reflects cumulative impairment losses of $1.071 billion since acquisition and an average carrying amount per bitcoin of approximately $22,409
· Resideo Technologies (REZI) 1Q EPS $0.58 vs est. $0.44 on revs $1.51B vs est. $1.45B; guides FY revs $6.45-6.65B vs est. $6.13B
· Sprout Social (SPT) Q1 EPS loss (3c) vs. est. loss (4c); Q1 revs $57.4M vs. est. $56.23M; sees FY22 loss EPS (13c)-(12c) vs. est. loss (13c); sees FY22 revenue $252M-$253M vs. est. $249.93M
· Verisk Analytics (VRSK) 1Q adj EPS $1.34 vs est. $1.39 on revs $775.5Mm vs est. $774.7Mm
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.