Early Look

Friday, September 6, 2024

U.S. futures are looking weak overnight, as investors showing concern ahead of this morning’s August nonfarm payroll report (released ta 8:30), while the tech heavy Nasdaq futures underperform, falling over 1% after Broadcom (AVGO) issued weaker guidance overnight sending shares down over -8% this morning. Yesterday, the Nasdaq ended higher led by shares of AMZN, while the biggest decliners among S&P 500 sectors were Financials, Industrials and Healthcare. Thursday’s data included the ADP National Employment Report, which showed that private payrolls increased by 99,000 jobs, the smallest gain since January 2021, after rising by a downwardly revised 111,000 in July. Friday’s jobs report is expected to show that employers added 160,000 jobs during August, up from 114,000 in July, and the unemployment rate is anticipated to ease to 4.2%, from 4.3%. Note the S&P 500 index posted its first 3-day losing streak since the first few days of August (8/1-8/5) yesterday, while the last 4-day losing streak was mid-April (6-day decline from 4/12-4/19, but worth noting was down 6 of 7 days in mid/late July). In Asian markets, The Nikkei Index dropped -265 points to 36,391, the Shanghai Index fell -22 points to 2,765, and the Hang Seng Index slipped -13 points to 17,444. In Europe, the German DAX is down -77 points to 18,499, while the FTSE 100 is down -27 points to 8,214. Treasury yields are lower with the 10-yr dipping below 3.7% while the dollar eases further on expectations of aggressive rate cuts by the Fed in two weeks at their policy meeting.

• The Dow Jones Industrial Average fell -219.22 points, or 0.54%, to 40,755.75.
• The Nasdaq Composite gained 43.37 points, or 0.25%, to 17,127.66.
• The Russell 2000 Index declined -13.16 points, or 0.61% to 2,132.06.

• 8:30 AM ET                  Private payrolls for August…est. +139K (prior 97K)
• 8:30 AM ET                  Manufacturing payrolls for August…est. 0K (prior +1K)
• 8:30 AM ET                  Unemployment Rate for Aug…est. 4.2%
• 8:30 AM ET                  Average Hourly Earnings M/M for Aug…est. +0.3% (prior +0.2%)
• 8:45 AM ET                  Fed’s Williams Gives Keynote Remarks
• 1:00 PM ET                   Baker Hughes Weekly rig count data

• Costco (COST) said August total comparable sales +5%, estimate +5.1% and U.S. comparable sales excluding fuel, currencies +6.7%, vs. estimate +6.2%; August net sales $19.93B, up 7.1%.
• Rent The Runway (RENT) Q2 EPS loss (-$4.17) vs. consensus loss (-$5.47); Q2 revs $78.9M vs. est. $77.2M; sees Q3 revenue $75M-$77M above consensus $75.57M and sees Q3 adjusted EBITDA margin 13%-15%; raises FY24 revenue growth view to between 2% to 6% vs FY23; had 129,073 ending active subscribers for 2Q.
• Smith & Wesson Brands (SWBI) authorized a new $50M stock buyback program; reported Q1 sales $88.3M vs. est. $102.5M and gross margins of 27.4%; continues to expect top- and bottom-line growth for full year.
• Zumiez (ZUMZ) Q2 EPS loss (-$0.04) vs. est. loss (-$0.33); Q2 revs $210.18M vs. est. $201.96M; Q2 comp store sales increased 3.6% vs. -8.6% y/y; guides year sales $221M-$225M vs. est. $217M.
• Helen of Troy (HELE) announces a new $500M share repurchase authorization.

• Planet Labs (PL) Q2 revs rose 14% y/y to $61.1M vs. est. $61.8M; sees Q3 revenue $61M-$64M, vs. consensus $64.2M, with gross margin expected to be in the range of approximately 59% to 61% and adjusted EBITDA loss is expected to be in the range of approximately ($5M) and ($2M); Q2 End of Period customer count increased 7% y/y to 1,012 customers.
• Quanex (NX) raises FY24 revenue view to $1.28B-$1.29B from $1.1B (est. $1.07B) and raises FY24 adjusted EBITDA view to $171M-$176M from $145M-$150M.

• Coinbase (COIN) upgraded to Equal Weight from Underweight at Barclays and cut tgt to $169 from $206.
• Robinhood (HOOD) upgraded to Equal Weight from Underweight at Barclays and up tgt to $20 from $18.
• PayPal Holdings (PYPL) upgraded its rewards program for debit card users with a 5% cash back offer. Users of the PayPal debit card, offered through MasterCard (MA), will receive 5% cash back on up to $1,000 in selected category spending per month. Previously, PayPal had in-app cash back offers at select merchants.

• DocuSign (DOCU) Q2 EPS $0.97 vs. est. $0.80; Q2 revs $736.0M vs. est. $727.36M; sees Q3 revenue $743M-$747M, above consensus $739.43M and non-GAAP operating margin 28.5%-29.5%; raises FY revenue to $2.94B to $2.95B, saw $2.92B to $2.93B, and guides subscription revenue $2.86B to $2.88B, saw $2.84B to $2.86B.
• Guidewire (GWRE) Q4 EPS $0.62 vs. est. $0.54; Q4 revs $291.5M vs. est. $283.9M; ended Q4 with record sales activity and fully ramped ARR growth of 19%; sees Q1 revenue $251M-$257M vs. consensus $236.1M; guides Q1 ARR $869M-$874M and non-GAAP operating income between $18M-$24M.
• Qualcomm (QCOM) has explored the possibility of acquiring portions of Intel’s (INTC) design business to boost the company’s product portfolio, according to two sources familiar with the matter, Reuters reported.
• Samsara Inc. (IOT) Q2 EPS $0.05 vs. est. $0.01; Q2 revs $300.2M vs. est. $289.5M; Q2 ending ARR of $1.264B, representing 36% y/y growth; 2,133 customers with ARR over $100,000, up 41% y/y; guides FY total revs $1.22B-$1.23B vs. est. $1.21B; posted Q2 gross margin 77%.
• Smartsheet (SMAR) Q2 EPS $0.44 vs. est. $0.29; Q2 revs $276.4M vs. est. $274.2M; Q2 Annualized recurring revenue (ARR) rose 17% y/y to $1.093B and average ARR per domain-based customer was $10,291, an increase of 16% y/y; guides Q3 EPS $0.29-$0.31 vs. est. $0.29 and revs $282M-$285M, vs. consensus $287.8M.
• UiPath (PATH) announced Ashim Gupta will be taking on an expanded role as Chief Operating Officer in addition to his responsibilities as CFO; reports Q2 EPS $0.04 vs. est. $0.03 and revs $316.3M vs. est. $303.7M; Q2 ARR of $1.551B, up 19% y/y and net new ARR of $43M; forecasts Q3 adj. Oper profit about $27M, vs. est. $22.9M.