Early Look

Friday, February 23, 2024

Futures	Up/Down	%	Last
Dow	40.00	0.10%	39,163
S&P 500	1.00	0.02%	5,098
Nasdaq	-15.00	0.09%	18,032

 

 

U.S. futures are little changed, as S&P futures (Spuz) trade in a tight 12-point range overnight (5,104.25 high and 5,092 low), last flattish just under 5,100 as major averages look to finish the week with gains, after snapping their 5-week winning streaks last Friday. New record highs on Thursday for the S&P 500 index (strong close about 15 points shy of 5,100), the Nasdaq 100 (Nasdaq closed above 16,000), and the Dow Jones Industrial Average (first close above 39,000) in another rally led by large cap tech (NVDA paced the gains after earnings/guidance beat in “AI” chip space), Communications, and Consumer Discretionary, though gains were largely broad-based (only utilities ended lower). The “QQQ” came within 2c of its all-time highs of $439.14 reached on 2/12 before pulling back to $438.40, but still ended up about 3%. After hotter inflation data last week (CPI and PPI) raised the warning flag for US markets, snapping the weekly win streaks and Treasury yields moved higher, all those concerns appear to have been wiped out with the earnings release of NVDA yesterday. The FOMO feeling has overshadowed any concerns about rates/yields, even as expectations of aggressive cuts get pushed further and further out. Again, for every day of market euphoria (like Thursday), there are reminders to exercise caution as Jason Goepfert tweeted late yesterday: "Unusual situation developing. The Nasdaq Composite is up nearly 3%, with fewer than 55% of issues advancing. All 5 precedents according to SentimenTrader occurred between 1999-2001." (not a positive signal). In Asian markets, The Nikkei Index was closed after hitting all-time highs the day prior above 39,000, the Shanghai Index rose 16 points back above 3,000 level, while the Hang Seng Index dipped -17 points to 16,725. In Europe, the German DAX is flat at 17,371, while the FTSE 100 is also flat at 7,686.

 

• The Dow Jones Industrial Average jumped 456.87 points, or 1.18%, to 39,069.11.
• The Nasdaq Composite surged 460.75 points, or 2.96%, to 16,041.62.
• The Russell 2000 Index advanced 19.09 points, or 0.96% to 2,013.84.

 

 

Macro	Up/Down	Last
Nymex	-1.16	77.45
Brent	-0.93	82.74
Gold	1.60	2,032.30
EUR/USD	0.0004	1.0825
JPY/USD	0.15	150.66
10-Year Note	+0.01	4.337%

 

• US drillers are exporting a record amount of crude oil, highlighting the pressure OPEC+ nations are under to stave off a global surplus as the coalition prepares to gather next month.  Exports in February are estimated at 4.81 million barrels a day – Bloomberg.
• Three top Federal Reserve officials said the US central bank is still on track to cut interest rates this year — just not anytime soon. Fed Vice Chair Philip Jefferson and Governor Lisa Cook said they’re optimistic inflation is still cooling despite a blip in January but made clear they want more evidence.
• Federal Reserve Governor Christopher Waller said January’s jump in consumer prices warrants caution in deciding when to start cutting interest rates, though he still expects reductions to begin later this year.

• Carvana (CVNA) Q4 EPS ($1.00) vs est. ($0.89), sold 76,090 retail units, revs $2.424B vs est. $2.528B; guides Q1 retail units sold slightly up y/y, adj EBITDA significantly above $100Mm vs est. $68.69Mm; sees retail units sold and adj EBITDA up for FY y/y.
• Copart (CPRT) Q2 EPS $0.33 vs est. $0.35 on revs $1.02B vs est. $1.028B.
• Floor & D�cor Holdings (FND) Q4 EPS $0.34, adj EBITDA $107.8Mm vs est. $94.01Mm on sales $1.048B vs est. $1.009B; guides FY net sales $4.6-4.77B vs est. $4.73B, comps (5.5)% to (2.0)%, adj EBITDA $520-560Mm vs est. $561Mm, EPS $1.75-2.05 vs est. $2.14.
• Fox Factory (FOXF) Q4 EPS adj $0.48 vs est. $0.83on sales $332.495Mm vs est. $327.1Mm; guides Q1 net sales $315-350Mm vs est. $425.68Mm and adj EPS $0.17-0.27 vs est. $1.15; sees FY net sales $1.53-1.68B vs est. $1.737B and adj EPS $2.30-2.60 vs est. $4.79; still see support for FY25 vision of $2.0B sales vs est. $1.911B.
• MercadoLibre (MELI) Q4 EPS $3.25 on revs rose 42% y/y to $4.261B vs. est. $4.12B; quarterly operating margin without one-offs stood at 13.4%, compared with 18.2% in the third quarter; said Q4 net profit was dented by two one-off taxes provisions in Brazil totaling $351M.
• Sleep Number (SNBR) Q4 adj EPS ($0.58) vs est. ($0.88) on sales $430Mm vs est. $420.78Mm, gr mgn 56.6%; guides FY adj EBITDA $125-145Mm vs est. $142.33Mm, net sales down mid-single digit vs est. -4.35%, gr mgn +100bps.
• Sprouts Farmers (SFM) Q4 adj EPS $0.49 vs est. $0.45 on sales $1.7B vs est. $1.693B, comps +3.3%; sees Q1 comps -2.5-3.5%, adj EPS $0.98-1.02 vs est. $0.97; sees FY comps +1.5-3.5%, net sales +5.5-7.5% vs est. +6.62%, adj EBIT $397-$412Mm vs est. $382.59Mm.

• EOG Resources (EOG) Q4 adj EPS $3.07 in-line with estimates while profit fell amid lower commodity prices; Q4 revs $6.357B vs. est. $6.189B; Q4 Volumes and per-unit operating costs beat guidance midpoints; for FY, announced $6.2 billion capital plan to grow oil production 3% and total production 7%.
• Edison Int’l (EIX) Q4 core EPS $1.28 tops consensus $1.16; sees FY24 core EPS $4.75-$5.05 vs. est. $5.06; reiterate the strong confidence we have in our long-term EPS growth targets of 5%-7% for 2021 through 2025 and 2025 through 2028.
• Huntsman (HUN) upgraded to Overweight from Equal Weight at Wells Fargo.
• Johnson Controls (JCI) downgraded to Neutral from Buy at Mizuho.
• Kratos Defense (KTOS) 16.67M share Secondary priced at $18.00.
• Intuitive Machines Inc. (LUNR) lander, nicknamed Odysseus, reached the moon at 6:23 p.m., the first private spacecraft to land on the lunar surface intact.

• Envestnet (ENV) Q4 EPS $0.65 vs. est. $0.53; Q4 revs rose 8% y/y to $317.6M vs. est. $311.7M; guides Q1 EPS $0.52-$0.57 on revs $322M-$326M vs. est. $0.56/$325.9M; Q4 Total operating expenses increased 55% to $496.3M y/y; Loss from operations was $178.7M.
• Intuit Corp. (INTU) Q2 adj EPS $2.63 vs est. $2.30 on revs $3.39B vs est. $2.978B; guides Q3 revs +10-11% vs est. +9.74% and adj EPS $9.31-9.38 vs est. $9.69; sees FY revs $15.89-16.105B vs est. $16.047B, adj op Inc $6.155-6.26B vs est. $6.229B and adj EPS $16.17-16.47 vs est. $16.38.

• Insulet Corp. (PODD) Q4 adj EPS $1.40 vs. est. $0.66; Q4 revs $509.8M vs. est. $461.05M; sees Q1 revenue growth 17%-20% and sees FY24 revenue growth 12%-17%; Q4 Total Omnipod revenue of $501.0M, an increase of 36.7%, or 35.4% in constant currency; U.S. Omnipod revenue of $394.6 million, an increase of 42.9%.
• Penumbra (PEN) Q4 EPS $1.38 vs est. $0.70, adj EBITDA $53.4Mm vs est. $42.2Mm on revs $284.7Mm vs est. $286.56Mm; guides FY revs $1.23-1.27B vs est. $1.267B, gr mgn +100-150bps and adj op mgn +100-200bps.

• Applied Optoelectronics (AAOI) Q4 EPS $0.04 vs. est. $0.00; Q4 revs $60.5M vs. est. $65.19M; sees Q1 EPS loss (33c)-(28c) vs. est. loss (-$0.01) and revs $41M-$46M, below consensus $66.18M.
• Indie Semiconductor (INDI) Q4 adj EPS loss (-$0.01), in-line with consensus on revs $70.1M vs. est. $72.56M; expect Q1 revenue to be up 38% y/y but down 20% sequentially, reflecting market seasonality and current industry softness.
• Live Nation (LYV) Q4 revs rose 36% y/y to $5.84B vs. est. $4.73B; said Concerts revenue rose 44% y/y to $4.87B and ticketing revs rose 14% y/y to $739.8M; 4Q ended with $6.2b in cash and cash equivalents, including $1.5b in ticketing client cash and $2.2b in free cash; said 2024 growth expected to be more weighted toward Q2 vs. Q3 vs previous yrs.
• Universal Display (OLED) Q4 EPS $1.29 vs est. $1.15 on revs $158.3Mm vs est. $161.2Mm, gr mgn 77%; guides FY24 revs $625-675Mm vs est. $666.21Mm.
• Upland Software (UPLD) Q4 EPS adj EPS $0.14 vs. est. $0.18; Q4 revs $72.2M vs. est. $71.35M; sees FY24 revenue $259M-$283M below consensus $290.3M and sees FY24 adjusted EBITDA $49M-$61M.
• Vicor Corp. (VICR) Q4 EPS $0.19 vs est. $0.33 on revs $92.7Mm vs est. $107.07Mm.

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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.