Early Look

Thursday, February 18, 2021

Futures	Up/Down	%	Last
Dow	-80.00	0.25%	31,469
S&P 500	-16.25	0.42%	3,911
Nasdaq	-110.50	0.81%	13,589

 

 

U.S. futures are lower (especially tech), pulling back ahead of another busy day of earnings and economic data while a sideshow takes place in Washington D.C. Markets await a grilling in DC as Robinhood’s Vlad Tenev, Melvin Capital’s Gabe Plotkin, Reddit’s Steve Huffman and Citadel’s Kenneth Griffin and Keith Gill are all set to testify before the U.S. House Financial Services Committee at noon, as well as a Reddit trader known as “Roaring Kitty”, who is credited with helping start the GameStop mania. Lawmakers will get their chance to ask questions in a hearing focused on “short selling, online trading platforms, gamification and their systemic impact on our capital markets and retail investors.” In Asian markets, The Nikkei Index fell -56 points to 30,236, the Shanghai Index reopened after a week-long holiday, gaining 21 points to 3,675 and the Hang Seng Index dropped -489 points to 30,595. In Europe, the German DAX is down a few points around 13,900, while the FTSE 100 is down about -50 points to 6,660. Major U.S. averages finished Wednesday mixed as the Dow Jones Industrial Average ended in new record territory behind gains in Chevron and Verizon after Warren Buffett’s Berkshire Hathaway revealed new stakes in each while the S&P 500 and Nasdaq Composite dropped as concerns about inflation pressured stocks and investors rotated out of technology shares. Treasury yields slipped but not before touching fresh 1-year highs of 1.33% for the 10-year following strong retail sales data and a jump in producer prices. The U.S. stock market’s recent rally has showed signs of cooling this week, even as investors point to reasons for optimism ahead, awaiting a new stimulus relief bill.

 

Events Calendar for Today

·     8:30 AM EST      Weekly Jobless Claims…est. 765K

·     8:30 AM EST      Continuing Claims…est. 4.413M

·     8:30 AM EST      Housing Starts MoM for January…est. 1.658M

·     8:30 AM EST      Building Permits MoM for January…est. 1.678M

·     8:30 AM EST      Import Prices MoM for January…est. 1.0%

·     8:30 AM EST      Philly Business Survey for February…est. 20.0

·     10:30 AM ET      Weekly EIA Natural Gas Inventory Data

·     11:00 AM ET      Weekly DOE Inventory Data

 

Earnings Calendar:

·     Earnings Before the Open: AAWW, ACRE, APRN, BLMN, CBB, CBZ, CFX, DAN, EPAM, FE, GEL, GTLS, HL, HRL, IART, ITGR, IDCC, LXP, MAR, MD, NEM, PPL, RS, SHLX, SO, SYNH, TRN, VC, VG, VTR, WAB, WM, WMT

·     Earnings After the Close: AEE, AIRG, AMAT, ANET, APRN, BIGC, BOOM, CASA, CENX, CNDT, COG, COLD, CVA, CWST, CXP, DBX, EHTH, EVBG, FLS, FTDR, HASI, HST, JAKK, KEYS, LNT, LTHM, MMI, MSA, OLED, OPK, PLNT, QDEL, ROKU, RXN, RXT, TRIP, TTD, TXRH

 

Market Closing Prices Yesterday

·     The S&P 500 Index slipped -1.26 points, or 0.03%, to 3,931.33

·     The Dow Jones Industrial Average rose 90.27 points, or 0.29%, to 31,613.02

·     The Nasdaq Composite dropped -82.00 points, or 0.58%, to 13,965.50

·     The Russell 2000 Index declined -16.78 points, or 0.74% to 2,256.11

 

 

Macro	Up/Down	Last
Nymex	-0.02	61.12
Brent	0.10	64.44
Gold	9.05	1,785.20
EUR/USD	0.0032	1.207
JPY/USD	-0.20	105.67
10-Year Note	+0.009	1.2804%

 

 

World News

·     The European Central Bank (ECB) will pay the currency bloc’s 19 central banks 1.6 billion euros in dividends this year, down from the 2.4 billion euros it paid a year ago as its profit declined, it said

·     The winter storm that crippled the Texas electrical grid is moving out of the state, but freezing temperatures remain, hampering attempts to restore full power as residents struggle. With 2.7 million Texas households still without heat Thursday morning, leaders warned of the dangers with a domino effect on infrastructure.

 

Sector News Breakdown

Consumer

·     Boston Beer (SAM) Q4 EPS $2.64 vs. est. $2.63; Q4 sales $460.9M vs. est. $453.2M; sees year EPS between $20-$24 vs. est. $22.88; Gross margin was 46.9% for the fourth quarter, a decrease from 47.4% in the comparable 13-week period in 2019; Depletions increased 26% and 37% from the 13- and 52-week comparable periods in the prior year; shipments increased 54.0% and 38.8% from the 13- and 52-week comparable periods in the prior year.

·     Cheesecake Factory (CAKE) 4Q adj EPS ($0.32) vs. est. ($0.04) on revs $554.6Mm vs. est. $599.3Mm, comps -19.5%; says about 80% of restaurants currently open with indoor dining rooms with limited capacity (avg 50% capacity)

·     Haverty Furniture (HVT) 4Q adj EPS $1.37 vs. est. $0.88 on sales $241.3Mm vs. est. $235Mm, 4Q comps +13.7%, says consumer nesting continues to drive record demand for home furnishings

·     Herbalife (HLF) announces new $1.5B share buyback authorization; sees 2021 sales +6% to +14.0%, saw +3% to +11%; Q4 adjusted EPS 71c vs. est. 84c and Q4 revenue $1.41B vs. est. $1.45B; raises FY21 adjusted EPS view to $4.25-$4.75 vs. est. $4.52

·     Hyatt Hotels (H) Q4 adjusted EPS loss ($1.77) vs. est. loss ($1.30); qtrly total management and franchise fee revenues decreased 67.4% to $47 mln, reflecting sequential improvement from $40 mln reported in q3; has suspended its quarterly dividend; qtrly comparable system-wide RevPAR decreased 68.9%; 2021 capital expenditures are expected to be approximately $110 million; in 2021 company expects to grow units, on a net rooms basis, by approximately 5.0%

·     Jack in the Box (JACK) Q1 op EPS $2.16 vs. est. $1.77; Q1 revenue $338.54M vs. est. $338.68M; Q1 Jack in the Box system same-store sales increased 12.5%, company same-store sales increased 7.5% driven by average check growth of 21.2% while transactions decreased 13.7%

·     Sleep Number (SNBR) 4Q adj EPS $2.19 vs. est. $1.45 on sales $568Mm vs. est. $551.5Mm; guides FY21 EPS at least $6.00 vs. est. $4.48

·     Sturm Ruger (RGR) Q4 EPS $1.78 versus 46c YoY and Q4 revenue $169.3M versus $105.1M YoY

·     Zillow (ZG) files automatic mixed securities shelf

·     Hormel Foods (HRL) Q4 EPS 41c vs. est. 41c; Q4 revenue $2.46B vs. est. $2.37B; sees year EPS $1.70-$1.82 vs. est. $1.73 and year sales $9.7B-$10.3B vs. est. $9.96B; expect a recovery in foodservice business, given acceleration in shipments during recent weeks

·     Tesla (TSLA) cut the price of its Model 3 Standard Range Plus to $36,990 from $37,990, while the Model Y Standard Range’s price came down to $39,990 from $41,990, according to the website

 

Energy

·     Crescent Point Energy (CPG) announced that it has entered into an agreement with Shell Canada Energy, an affiliate of Royal Dutch Shell (RDS.A), to acquire Shell’s Kaybob Duvernay assets in Alberta for $900M

·     Texas Governor Greg Abbott said that he has issued an order banning Texas gas producers from exporting fuel to anywhere outside of the state as it attempts to restore electricity supplies amid an energy crisis – Bloomberg

·     KBR (KBR) won a $539M engineering task order to support rapid prototyping and fielding of systems for the U.S. Air Force’s Tactical Exploitation of National Capabilities, or TENCAP, program

 

Financials

·     CyrusOne (CONE) Q4 FFO 94c vs. est. 93c; Q4 revs $268.4M vs. est. $265.4M; sees 2021 revs $1.105B-$1.145B

·     Tanger Factory (SKT) Q4 core FFO 54c vs. est. 36c; Q4 revenue $111.15M vs. est. $98.3M; sees 2021 core FFO $1.47-$1.57 vs. est. $1.44

 

Healthcare

·     10x Genomics (TXG) Q4 EPS loss ($3.87) vs. est. loss (23c); Q4 revenue $112.22M vs. est. $100.4M; sees FY21 revenue $480M-$500M, vs. consensus $494.02M

·     Community Health (CYH) Q4 adj EPS 96c vs. est. 24c; Q4 revenue $3.12B vs. est. $3.07B; consolidated operating results for the three months ended December 31, 2020, reflect a 12.9% decrease in admissions and a 17.8% decrease in adjusted admissions, compared with the same period in 2019. On a same-store basis, admissions decreased 3.4% and adjusted admissions decreased 9.5%; sees FY21 revenue $11.7B-$12.5B vs. est. $12.14B and sees FY21 adjusted EBITDA $1.6B-$1.8B

·     Globus Medical (GMED) Q4 EPS 58c vs. est. 51c; Q4 revenue $233.45M vs. est. $231.22M; said Q4 growth of 10% was led by Enabling Technologies at $18 million, up 30% in the quarter, and US Spine, which grew by 12%, even though COVID-related cancellations caused an estimated drag of about five percentage points; guides year EPS $1.83 vs. est. $2.01

·     Invitae Corp. (NVTA) 4Q adj EPS ($0.63) vs. est. ($0.55) on revs $100.4Mm vs. est. $98.4Mm, FY revs $279.6Mm vs. est. $276.7Mm; sees generating FY21 revs in excess of $450Mm vs. est. $488.4Mm, sees revs growth +50-60% annually over next few years

·     Shockwave Medical (SWAV) Q4 EPS loss (46c) vs. est. loss (42c); Q4 revenue $22.7M vs. est. $20.15M; Cash, cash equivalents and short-term investments totaled $202.4 million as of December 31, 2020

·     Tilray (TLRY) Q4 EPS loss (2c) vs. est. loss (15c); Q4 revenue $56.6M vs. est. $55.76M; cash and cash equivalents totaled $189.7 mln at end of q4 of 2020; qtrly total revenue increased to $56.6 (c$74.4) mln, up 20.5% compared to q4 of 2019

·     Veracyte (VCYT) 4Q EPS ($0.14) vs. est. ($0.11) on revs $34.5Mm vs. est. $31.9Mm; guides combined revs in FY21 about $190-200Mm vs. est. $151.2Mm

·     Y-mAbs Therapeutics (YMAB) 2.44M share Spot Secondary priced at $41.00

·     Smith & Nephew (SNN) Q4 trails profit estimates; posted a pretax profit of $246 million for last year, compared with $743 million for 2019 and below estimates of $268 mln

·     Syneos Health (SYNH) Q4 adj EPS $1.11 vs. est. $1.10; Q4 revenue $1.14B vs. est. $1.14B; sees FY21 adj EPS $4.09-$4.38 vs. est. $4.23; sees FY21 revenue $5.125B-$5.325B vs. est. $5.22B

·     Essa Pharma (EPIX) 4.831M share Secondary priced at $27.00

·     Veru (VERU) 6.45M share Spot Secondary priced at $15.50

 

Industrials & Materials

·     Albemarle (ALB) 4Q adj EPS $1.17 vs. est. $1.10 on sales $879.1Mm vs. est. $847Mm; guides FY adj EPS $3.25-3.65 vs. est. $4.08, expects FY21 lithium volumes higher due to North American restarts and efficiency improvements; longer-term sees lithium demand to grow in-line with greater EV adoption

·     Axalta (AXTA) Q4 adj EPS 58c vs. est. 43c; Q4 revenue $1.075B vs. est. $1.03B; sees Q1 adj EPS 40c-45c vs. est. 37c and sees Q1 revenue growth 3%-5% (est. $1.03B)

·     Nutrien (NTR) Q4 EPS 24c vs. est. 15c; Q4 revenue $4.05B vs. est. $3.58B; Q4 potash EBITDA up 48%, nitrogen EBITDA up 3%; increases dividend to 46c; approved the purchase of up to 5% of outstanding common shares; sees FY21 EPS $2.05-$2.75 vs. est. $2.40

·     Mosaic (MOS) Q4 EPS 57c vs. est. 20c; Q4 revenue $2.46B vs. est. $2.17B; in potash, co expects to realize a $20 to $25 per tonne improvement in average realized prices in first quarter over fourth quarter of 2020; in phosphates, co expects to realize a $40 to $50 per tonne improvement in average realized prices in first quarter over fourth quarter; improving fertilizer markets during h2 of 2020 reflected the tightening supply and demand balance in both potash and phosphates

·     Tronox holdings (TROX) 4Q adj EPS $0.19 vs. est. $0.20 on revs $783Mm vs. est. $758.2Mm; guides 1Q TIO2 sales volumes +11-15% sequentially from global demand strength

·     Valmont Industries (VMI) 4Q adj EPS $2.20 vs. est. $1.79 on sales $798.4Mm vs. est. $724.8Mm; sees 1Q sales $740-765Mm vs. est. $708.8Mm, sees FY net sales +9-14% vs. est. +6.5%, sees FY21 EPS $9.00-9.70 vs. est. $8.76

·     Waste Connections (WCN) sees fy21 revenue about $5.8b, consensus sees 2021 adj FREE cash flow at least $950M; sees 2021 rev. about $5.80b, vs. est. $5.85b follows Q4 EPS and revenue beat

 

Technology, Media & Telecom

·     Fastly (FSLY) Q4 adj EPS loss (9c) vs. est. loss (10c); Q4 revenue nearly $83M vs. est. $82.03M; sees Q1 adj EPS loss (13c)-(9c) vs. est. loss (9c) and revenue $83M-$86M vs. est. $84.58M; sees FY21 adjusted EPS (44c)-(35c) vs. est. loss (21c) and revs $375M-$385M vs. est. $379.5M

·     MagnaChip Semiconductor (MX) 4Q adj EPS $0.40 vs. est. $0.16 on revs $142.9Mm vs. est. $124.4Mm; guides 1Q revs $119-124Mm vs. est. $116.6Mm

·     ManTech (MANT) 4Q adj EPS $0.89 vs. est. $0.79 on revs $639Mm vs. est. $628.6Mm; guides FY21 adj EPS $3.48-3.60 vs. est. $3.49, sees FY21 revs $2.65-2.75B vs. est. $2.66B

·     Stamps.com (STMP) Q4 adj EPS $4.13 vs. est. $2.62; Q4 revs $206M vs. est. $194.3M; not providing specific guidance; Total Paid Customers — that is, customers from whom we successfully collected service fees or otherwise earned revenue at least once during that quarter — for the fourth quarter was 1.02 million, up 266 thousand versus the fourth quarter of 2019

·     Synopsis (SNPS) Q4 adj EPS $1.52 vs. estimate $1.47; Q4 revs $970.3M vs. est. $954.2M; sees Q2 revs $970.0M-$1B vs. est. $979.9M; still sees revenue $4B-$4.05B vs. est. $4.03B

·     SiTime (SITM) 3M share Secondary priced at $127.00

·     Twilio (TWLO) shares rise 14%; 4Q adj EPS $0.04 vs. est. ($0.08) on revs $548.1Mm vs. est. $454.8Mm; says more than 221,000 active customer accounts end of yr vs 179,000 yr ago; guides 1Q revs $526-536Mm vs. est. $492.1Mm, sees 1Q adj EPS ($0.12-0.09) vs. est. ($0.02)