Early Look

Friday, January 31, 2025

S&P futures are trading near their overnight highs at 6,127, rising +0.45% as futures shake off tariff headlines late Thursday, boosted by Apple (AAPL) results overnight and ahead of PCE inflation data at 8:30 am et. U.S. stocks closed higher, rallying into the bell on a day that saw broad market strength as nearly all eleven S&P sectors finished higher. Late yesterday, President Trump reiterated his plans to put a 25% tariff on imports from Mexico and Canada to take effect Saturday, repeating his warning against America’s top U.S. trade partners, sinking stocks briefly before rebounding. Shares of mega cap tech companies were still mixed for the week after a sharp rout on Monday that hammered Nvidia Corp. on AI competition concerns. The focus this morning will be on the Fed’s preferred measure of inflation, the January core PCE reading at 8:30 am et. In Asian markets, The Nikkei Index rose 58 points to 39,572, while the Shanghai Index and Hang Seng Index remained closed for their Lunar Year holiday. In Europe, the German DAX is up 59 points to 21,787, while the FTSE 100 rise 30 points to 8,677 as Europe extends recent all-time highs following the ECB rate cut on Thursday. Gold prices remain at record highs, Bitcoin pares gains and Treasury yields steady as the 10-yr holds above 4.5%.

• The Dow Jones Industrial Average rose 168.61 points, or 0.38%, to 44,882.13.
• The Nasdaq Composite gained 49.43 points, or 0.25%, to 19,681.75.
• The Russell 2000 Index advanced 24.36 points, or 1.07% to 2,307.46.

• 8:30 AM ET                  Personal Spending M/M for December…
• 8:30 AM ET PCE Price Index M/M for December…est. +0.3% (prior +0.1%)
• 8:30 AM ET PCE Price Index Y/Y for December…est. +2.6% (prior +2.4%)
• 8:30 AM ET                  Core PCE Price Index M/M for December…est. +0.2% (prior +0.1%)
• 8:30 AM ET                  Core PCE Price Index Y/Y for December…est. +2.8% (prior +2.8%)
• 8:30 AM ET                  Employment Cost Index (ECI) for Q4…+0.9% (prior +0.8%)
• 9:45 AM ET                  Chicago PMI for January…est. 40.0 (prior 36.9)
• 1:00 PM ET                   Baker Hughes Weekly rig count data

• Boot Barn (BOOT) Q3 EPS $2.43 vs. est. $2.38; Q3 sales rose 17% y/y to $608.2M, in-line with consensus; Q3 same-store sales +8.6% vs. -9.7% y/y, and vs. est. +8.16% while E-Commerce comp sales +11.1% vs. -11.5% y/y; guides FY sales $1.908B-$1.918B vs. est. $1.91B.
• Deckers Outdoors (DECK) shares tumbled; Q3 EPS $3.00 vs est. $2.56, op Inc $567.274Mm vs est. $493.4Mm on sales $1.827B vs est. $1.729B, gross margin 60.3%; guides FY revs approx +15% vs est. +14.9% and EPS $5.75-5.80 vs est. $5.63; Q3 UGG brand net sales increased 16.1% to $1.244B, Q3 HOKA brand net sales increased 23.7% to $530.9M and Q3 Teva brand net sales decreased 6.0% to $24.1M.
• SkyWest (SKYW) Q4 EPS $2.34 vs est. $1.79 on revs $944.402Mm vs est. $915.63Mm, says reaches multi-year contract extension with American Airlines (AAL).
• Adtalem Global Education (ATGE) Q2 adj EPS $1.81 vs est. $1.37, adj EBITDA $125Mm vs est. $99.29Mm on revs $447.7Mm vs est. $429.27Mm; guides FY25 revs $1.73-1.76B vs est. $1.721B and adj EPS $6.10-6.30 vs est. $5.89.
• Walgreens Boots Alliance (WBA) suspends quarterly cash dividend.

• Chevron (CVX) Q4 adj EPS $2.06 vs. est. $2.11; Q4 revenue $52.23B vs. est. $48.41B; raised dividends by 5% even as profit underperformed expectations amid shrinking crude prices and fuel-making margins; Q2 worldwide and U.S. net oil-equivalent production increased 7 and 19 percent, respectively, from last year.
• ExxonMobil (XOM) Q4 adj EPS $1.67 vs. est. $1.55 on higher oil and gas production; FY24 earnings fell 13.2% to $33.46 billion on weaker refining margins; lower seasonal scheduled maintenance to increase upstream volumes by about 80koebd in q1 and sees Q1 corporate & financing expenses to be $400 mln-$600 mln.
• Diamondback Energy (FANG) announced that it has entered into a definitive purchase agreement with Viper Energy (VNOM), a subsidiary of Diamondback, to sell certain mineral and royalty interests from subsidiaries of Diamondback for $1B in cash and approximately 69.6M units of Viper’s operating subsidiary in a drop down. Transaction.
• Occidental Petroleum (OXY) was downgraded to Sell from Neutral at Goldman Sachs and reduced their price target to $45 from $54.

• Allstate Corp (ALL) said to sell group health business to Nationwide for $1.25B; said the sales are expected to generate $450M financial book gain; sale to reduce adjusted net income return on equity by 75 basis points.
• Hartford Financial (HIG) Q4 core EPS $2.94 vs est. $2.63 on revs $6.88B vs est. $63914B, written premiums $3.174B.
• Ameris Bancorp (ABCB) Q4 adjusted EPS $1.38 vs. est. $1.19; raises dividend to $0.20 from $0.15.
• Credit Acceptance (CACC) Q4 adj EPS $10.17 vs est. $7.93 on revs $565.9Mm vs est. $522.6Mm.
• LPL Financial (LPLA) Q4 adj EPS $4.25 vs est. $3.94 on revs $3.51B vs est. $3.31B.
• PennyMac Financial (PFSI) Q4 EPS $1.95 vs est. $3.12 on revs $470.1Mm vs est. $522.36Mm.

• Vertex Pharmaceuticals (VRTX) said it won U.S. approval for the first new non-opioid painkiller in decades as the FDA approved its suzetrigine to treat moderate to severe acute pain. The drug is set to be sold under the brand name Journavx. Vertex will charge $15.50 per pill, or $217 for a week’s prescription.

• Eaton (ETN) Q4 adj EPS $2.83 vs. est. $2.81; Q4 revs $6.2B vs. est. $6.34B; sees FY25 adjusted EPS $11.80-$12.20, vs. consensus $12.00; sees FY25 organic growth of 7-9%; Segment margins of 24.4-24.8%.
• Olin (OLN) Q4 EPS $0.09 vs. est. loss (-$0.04); Q4 revs rose 3.5% y/y to $1.67B vs. est. $1.55B; Q4 adj EBITDA fell -7.9% y/y to $193.4M vs. est. $173.6M; said expect Q1 results from Chemicals businesses to be lower than Q4 2024 as our disciplined market participation continues; Q1 Chlor Alkali business expects sequentially lower chlorine and caustic soda volumes and continued pricing pressure on ethylene dichloride.
• U.S. Steel (X) Q4 adj EPS loss (-$0.13) vs. est. loss (-$0.26); Q4 revs $3.51B vs. est. $3.24B; Q4 adj Ebitda $190M and sees Q1 adjusted EBITDA $100M-$150M; said Q1 North American Flat-Rolled segment results are expected to decrease, primarily driven by seasonal logistics constraints in the mining sector, which will unwind in the second quarter. We expect this to be partially offset by resiliency in our commercial strategy.
• Weyerhaeuser (WY) Q4 EPS $0.11 vs est. $0.07 on sales $1.7B vs est. $1.716B, says expects Q1 earnings before special items and adj EBITDA will be about $20Mm higher than Q4.

• AppFolio (APPF) Q4 EPS $0.92 vs. est. $0.94; Q4 revs $203.66M vs. est. $200M; sees FY25 revenue $920M-$940M vs. est. $927.31M and sees FY25 operating margin 24.5%-26.5% of revenue.
• Atlassian (TEAM) Q2 adj EPS $0.96 vs. est. $0.76; Q2 revs rose 21% y/y to $1.29B vs. est. $1.24B; Q2 Subscription revenue of $1,213B, up 30% y/y; Q2 GAAP operating margin of (4)% and non-GAAP operating margin of 26%; sees Q3 revenue $1.345B-$1.353B vs. est. $1.32B; Cloud revenue growth y/y is expected to be about 23.5%.
• Intel Corp. (INTC) Q4 adj EPS $0.13 vs est. $0.12 on revs $14.3B vs est. $13.81B, gr mgn 39.2%; sees Q1 revs $11.7-12.7B vs est. $12.872B, gr mgn 33.8% vs est. $39.12% and adj EPS $0.00 vs est. $0.09.
• KLA-Tencor (KLAC) Q2 adj EPS $8.20 vs. est. $7.76; Q2 revs $3.08B vs. est. $2.95B; guides Q3 total revenues in range of $3.0B plus/minus $150M vs. est. $2.88B and GAAP gross margin is expected to be in a range of 60.6% +/- 1.0%; non-GAAP gross margin is expected to be in a range of 62.0% +/- 1.0%.
• Gen Digital (GEN) Q3 adj EPS $0.56 vs est. $0.55 on revs $986Mm vs est. $985.1Mm, op mgn 38%; guides Q4 revs $990Mm – $1.005B vs est. $995.19Mm and FY revs $3.915-3.93B vs est. $3.922B.
• Viavi (VIAV) Q2 adj EPS $0.13 vs. est. $0.10; Q2 revs $270.8M vs. est. $259.99M; sees Q3 adj EPS $0.10-$0.13 vs. est. $0.09 and sees Q3 revenue $276M-$288M vs. est. $255.6M.
• Samsung gets Nvidia’s (NVDA) approval to Supply Less Advanced AI Memory, Bloomberg reports; the company’s 8-layer HBM3E was cleared by Nvidia in December; Samsung is still behind SK Hynix, supplier of 12-layer HBM3E (note shares of memory names Hynix, MU trade lower on headlines).