Early Look

Wednesday, May 5, 2021

Futures	Up/Down	%	Last
Dow	87.00	0.26%	34,107
S&P 500	15.25	0.37%	4,173
Nasdaq	79.50	0.59%	13,615

 

 

U.S. stock futures are looking higher by 0.4% or 16 points to 4,175 level as major averages pared losses into the close last night as Treasury Secretary Janet Yellen said late Tuesday, she is neither predicting nor recommending that the Federal Reserve raise interest rates as a result of President Biden’s spending plans, walking back her comments earlier in the day that rates might need to rise to keep the economy from overheating. In Asian markets, The Nikkei and Shanghai Index remained closed, while the Hang Seng Index fell -139 points to 28,417. In Europe, the German DAX jumps about 200 points to move back above the 15,000 level, while the FTSE 100 is higher by roughly 80 points to trade just above 7,000. Stocks finished mostly lower on Tuesday, as the Dow eked a small gain late day, though the Nasdaq Composite fell just under 2% with technology stocks leading the way lower as investors digested commentary from Treasury Secretary Janet Yellen around the possibility of higher interest rates. Stocks pared losses into the close, as the S&P 500 pulled back off its recent all-time highs. Major averages had opened lower, losing steam throughout the morning before former Fed Chairperson, and now Treasury Secretary Janet Yellen said she thought interest rates in the U.S. might need to rise in order to prevent an economic overheating during the recovery out of the pandemic, which accelerated the market selling pressure. The comments are a stark contrast to several Fed speakers over the last few weeks including current Fed Chairman Jerome Powell. Today markets brace for another heavy day of earnings.

 

Market Closing Prices Yesterday

·     The S&P 500 Index slipped -28.00 points, or 0.67%, to 4,164.66

·     The Dow Jones Industrial Average rose 19.80 points, or 0.06%, to 34,133.03

·     The Nasdaq Composite plunged -261.62 points, or 1.88%, to 13,633.50

·     The Russell 2000 Index declined -29.17 points, or 1.28% to 2,248.29

 

Events Calendar for Today

·     7:00 AM ET         MBA Mortgage Applications Data

·     8:15 AM EST      ADP Employment Change for April…est. 800K

·     9:45 AM EST      Markit Composite PMI, Apr-F

·     9:45 AM EST      Markit Services PMI, Apr-F

·     10:00 AM EST    ISM Non-Manufacturing Index for April…est. 64.3

·     10:30 AM ET      Weekly DOE Inventory Data

 

Earnings Calendar:

·     Earnings Before the Open: ABC, AEIS, ASTE, BBSI, BDC, BRKR, BWA, CDW, CERN, CLH, CLVS, CMLS, CVGI, DIN, DNB, DNOW, EDIT, EMR, EXC, FLEX, FLOW, FUN, GEL, GM, HFC, HLT, HZNP, IONS, JLL, KALA, LL, MDCA, NI, NRZ, NYT, ODP, OMI, PEG, PNW, PSN, ROCK, SBGI, SGRY, SITE, SMG, SPR, SPWR, SRE, SSYS, TUP, UTHR, VRCL, VRTV, VST, WAT, WRK

·     Earnings After the Close: ACAD, ADPT, ADT, ADTN, AEL, AINC, ALB, ALL, AMPE, ANSS, APA, ARNA, ASYS, ATO, AVID, BAND, BE, BKNG, CCMP, CDAY, CDNA, CENX, CF, CLW, CNDT, CPE, CSGS, CTSH, CW, CXW, DCP, DGII, DHX, EMKR, EQH, EQT, ETSY, EVH, FICO, FLT, FMC, FOXA, FSLY, GBT, GDDY, GDOT, GKOS, GNK, HCC, HDSN, HUBG, IVC, IVR, KTOS, KW, LCI, LESL, LNC, LPI, MET, MRO, MTG, MTW, NBIX, NP, NUS, NUVA, OAS, ORA, PDCE, PRI, PYPL, QLYS, QRVO, QTWO, RCII, RDFN, RGR, RIGL, RKT, ROOT, RUN, RYI, RYN, SKT, SRPT, SUNS, TLND, TNDM, TPC, TPTX, TTGT, TWLO, TWO, UBER, UNM, UPLD, VAC, VNDA, WHD, WLL, WMC, WW, XEC, YELL, ZIXI, ZNGA

 

Other Key Events:

·     BMO Capital Global Reserve & Asset Manager Conference (virtual), 5/4-5/6

·     Davidson Financial Institution Conference (virtual), 5/5-5/7

·     Goldman Sachs European SMID Symposium (virtual), 5/4-5/7

·     Oppenheimer Industrial Growth Conference, 5/4-5/5

·     Dell Technologies (DELL) Virtual Event, 5/5-5/6

·     China Caixin Services PMI

·     China Imports and Exports for April

 

 

Macro	Up/Down	Last
Nymex	0.85	66.54
Brent	0.89	69.77
Gold	-1.75	1,777.30
EUR/USD	0.0001	1.2015
JPY/USD	-0.03	109.30
10-Year Note	+0.015	1.607%

 

 

World News

·     Fed’s Kashkari said the Fed doesn’t want to cut off the recovery too soon, if taxes are raised to pay for new spending that won’t be inflationary, he’s not worried that the fiscal packages so far will create inflation, once the labor market recovers & inflation is back to target we’ll normalize mon policy, full employment make take a few years

·     Treasury Secretary Janet Yellen downplayed her earlier comments in the day on rates that sunk markets, suggesting the Biden admin’s spending plans might prompt the Fed to lift rates, she said that’s not something I’m predicting or recommending, doesn’t think there’ll be an inflationary prob but if there is the Fed will address it – WSJ interview

 

Sector News Breakdown

Consumer

·     Borg Warner (BWA) 1Q adj EPS $1.21 vs. est. $0.92 on sales $4.0B vs. est. $3.57B; guides FY sales $14.8-15.4B vs. est. $14.9B, sees FY FCF $800-900Mm and op cash flow $1.525-1.675B, sees FY adj EPS $4.00-4.35 vs. est. $4.01

·     Honest Company (HNST) 25.81M share IPO priced at $16.00

·     Hilton (HLT) Q1 adjusted EPS 2c vs. est. 8c; Q1 revenue $874M vs. est. $1.1B; Q1 system-wide comparable RevPAR decreased 38.4%, but was an improvement from $40.68 in the prior quarter

·     Lumber Liquidators (LL) Q1 adj EPS 34c vs. est. 27c; Q1 revs $283.54M vs. est. $293.12M; Q1 comp sales rose 6.9%; company’s selling, general and administrative expenses rose to $102.5M from $96.21M

·     Big 5 Sporting Goods (BGFV) said Q1 same-store sales rose 31.8% vs guidance of 20% growth, reflecting broad-based demand for apparel, footwear and hardgoods; for Q2, sees comp sales to increase 22%-27% and expects adj EPS of $1.05-$1.25; raises dividend and declares special cash dividend of $1 per share

·     Caesar’s Entertainment (CZR) Q1 EPS loss ($2.03) vs. est. loss ($1.80); Q1 revenue $1.7B in-line with consensus $1.7B; Net loss of $423 million compared to a net loss of $176 million for the comparable prior-year period; same-store Adjusted EBITDA of $548 million versus $410 million for the comparable prior-year period

·     Denny’s (DENN) adj EPS $0.01 vs. est. $0.04 on revs $80.6Mm vs. est. $79Mm; cannot reasonably provide outlook for FY at this time

·     Hyatt (H) 1Q adj EPS ($3.57) vs. est. ($1.30), qtrly comparable system-wide REVPAR -48.9%; guides FY CAPEX about $110Mm, sees adj SG&A about $240Mm; says from Jan to Mar 2021 system wide comparable REVPAR rose over 50%; has suspended all share repurchase activity and suspended qtrly dividend; as of March 31, 2021 94% of rooms were open

·     Lyft Inc. (LYFT) 1Q revs $609Mm vs. est. $558.7Mm; adj net loss $114.1Mm; qtrly revs per active rider $45.13 vs $45.06 yr ago; 1Q contribution mgn 55.4% -1.9% yr/yr; says democratic labor bill “pr act” faces tough challenge in congress, foresees compromise deal

·     Masonite (MASI) 1Q adj EPS $1.93 vs. est. $1.77 on sales $646Mm vs. est. $602Mm; guides FY sales +12-15% vs. est. +9.5%, sees FY adj EPS $8.00-8.60 vs. est. $8.07

·     Pool Corp. (POOL) announces a 38% increase in its quarterly cash dividend and an additional $450.0 million of authorization under its share repurchase program

·     Zillow Group (ZG) Q1 revenue $1.2B vs. est. $1.1B; sees Q2 revenue $1.236B-$1.284B vs. est. $1.3B; Q1 Adjusted EBITDA exceeded the high end of the company’s outlook for all three segments, resulting in consolidated Adjusted EBITDA of $18M; traffic to Zillow Group’s mobile apps and websites in the first quarter reached 221 million average monthly unique users, an increase of 15% year over year, driving 2.5 billion visits during the quarter, up 19% year over year

 

Energy

·     Ameresco (AMRC) 1Q adj EPS $0.25 vs. est. $0.10 on revs $252.2Mm vs. est. $203.2Mm; guides FY revs $1.11-1.16B vs. est. $1.12B, sees FY adj EPS $1.22-1.30 vs. est. $1.20

·     Devon Energy (DVN) Q1 adj EPS 45c vs. est. 33c; operating cash flow totaled $592M in Q1, with EBITDAX reaching $959M; board increases fixed-plus-variable dividend payout by 13% to $0.34 per share; Q1 oil production totaled 268,000 barrels per day, exceeding guidance by 5,000 barrels per day; on track to achieve its full-year 2021 capital objectives; has made no modifications to its full-year capital budget or production outlook

·     HollyFrontier Corporation (HFC) entered into a definitive agreement to acquire the Puget Sound Refinery for a purchase price of $350 million, plus hydrocarbon inventory to be valued at closing with an estimated current value in the range of $150-180 million

·     Pioneer Natural Resources (PXD) Q1 adj EPS $1.77 vs. est. $1.45; Q1 revenue $2.444B vs. est. $1.49B; averaged q1 oil production of 281 thousand barrels of oil per day; averaged q1 production of 474 thousand barrels of oil equivalent per day (MBoed); for 2022, company expects to distribute up to 50% of 2021 free cash flow, after payment of base dividends; sees total 2021 capital budget range of $3.1 bln to $3.4 bln

·     ProPetro (PUMP) 1Q EPS ($0.20) vs. est. ($0.16) on revs $161Mm vs. est. $173.6Mm, qtr hurt by 8 days of lost revs during extreme winter weather in TX

 

Financials

·     NASDAQ (NDAQ) said April U.S. equity options volume of 249 mln contracts vs 201 mln contracts and April U.S. matched equity volume 35,298 mln shares vs 46,064 mln shares

·     Paycom Software (PAYC) Q1 EPS $1.47 vs. est. $1.42; Q1 revenue $272.2M vs. est. $271.41M; sees Q2 revenue $231M-$233M vs. est. $226.98M; sees Q2 adjusted EBITDA $80M-$82M

·     Prudential (PRU) Q1 EPS $4.11 vs. est. $2.76; qtrly book value per common share of $145.05; qtrly adjusted book value per common share of $100.49; AUM amounted to $1.663 trillion at quarter end versus $1.481 trillion for year-ago; boosts share repurchase program by $500 mln; remain on track to realize $750 mln in cost savings by end of 2023

·     Western Union (WU) Q1 adj EPS 44c vs. est. 45c; Q1 revenue $1.2B vs. est. $1.2B; reaffirms 2021 financial outlook for revenue and margin; qtrly consumer-to-consumer (c2c) transactions increased 9%, while revenues increased 4% on a reported basis, or 2% constant currency; sees 2021 adj eps in a range of $2.00 – $2.10 vs. est. $2.05

 

Healthcare

·     AmerisourceBergen (ABC) Q2 adj EPS $2.53 vs. est. $2.48; Q2 revs $49.2B vs. est. $49.97B; raises FY21 adjusted EPS view to $8.45-$8.60 from $8.40-$8.60 9est. $8.56)

·     Owens & Minor (OMI) Q1 adjusted EPS $1.57 vs. est. 99c; Q1 revenue $2.33B vs. est. $2.37B; raises FY21 adjusted EPS view to $3.75-$4.25 from $3.00-$3.50

·     Esperion (ESPR) shares fell over 20%; Q1 EPS loss ($3.50) vs. est. loss ($2.52); Q1 revenue $8M below consensus $22.03M

·     Exact Sciences (EXAS) 1Q EPS ($0.18) vs. est. ($1.03) on revs $402.1Mm vs. est. $388.6Mm; sees FY revs $1.69-1.735B vs. est. $1.722

·     Globus Medical (GMED) 1Q adj EPS $0.49 vs. est. $0.37 on revs $227.3Mm vs. est. $198.4Mm; guides FY net sales $925Mm vs. est. $881.6Mm

·     Inspire Medical (INSP) Q1 EPS loss (60c) vs. est. loss (66c); Q1 revenue $40.4M vs. est. loss $36.94M; is increasing its FY21 revenue guidance to between $192M-$196M, which would represent growth of approximately 66%-70% over FY20 revenue of $115.4M. Gross margin for FY21 is now anticipated to be in the range of 84%-85%

·     Invitae (NVTA) files to sell 2.01M shares of common stock for holders

·     Jazz Pharma (JAZZ) Q1 EPS $3.92 vs. est. $3.71; Q1 revenue $607.58M vs. est. $608.24M; Xyrem net product sales decreased 18% to $335.6M in Q1 YoY; backs year EPS and revenue outlook

·     Penumbra (PEN) Q1 EPS 32c vs. est. 9c; Q1 revenue $169.2M vs. est. $152.7M; raises FY21 revenue view to $695M-$705M from $675M-$685M (est. $681.51M)

·     PTC Therapeutics (PTCT) Q1 EPS loss ($1.83) vs. est. loss ($1.51); Q1 revenue $117.49M vs. est. $98.8M; said cash, cash equivalents and marketable securities was $988.4M at March 31, compared to $1.1B at December 31, 2020; expect net product rev for DMD franchise for 2021 to be between $355m and $375m

 

Industrials & Materials

·     Corteva Inc. (CTVA) Q1 adj EPS 79c vs. est. 65c; Q1 revenue $4.18B vs. est. $3.81B; backs FY21 operating EPS view $1.85-$1.95 (est. $1.92) and ups FY21 revenue view to $14.6B-$14.8B from $14.4B-$14.6B (est. $14.67B)

·     Hillenbrand (HI) 2Q adj EPS $0.98 vs. est. $0.91 on revs $722Mm vs. est. $707Mm; guides 3Q revs $665-695Mm vs. est. $659Mm, sees 3Q adj EPS $0.70-0.80 vs. est. $0.78

·     WestRock (WRK) Q2 adj EPS 54c vs. est. 61c; Q2 revs $4.4B vs. est. $4.51B; raises quarterly dividend 20% to 24c from 20c per share; Record second quarter North American per day box shipments up 5.5% compared to the prior year quarter; successfully implementing published PPW price increases across all major paper grades

 

Media & Telecom

·     Match Group (MTCH) Q1 EPS 57c vs. est. 40c; Q1 revenue $667.6M vs. est. $650.66M; Q1 ARPU increased 9% YoY 64c; said Q1 average Subscribers increased 12% to 11.1M from 9.9M YoY; Tinder Direct Revenue grew 18% year-over-year, driven by 15% Average Subscriber growth, and ARPU growth of 4%; sees Q2 revenue $680M-$690M vs. est. $678.76M

·     OutFront Media (OUT) Q1 EPS loss (52c) vs. est. loss (43c); Q1 revenue $259.2M vs. est. $272.67M

·     Skillz Inc. (SKLZ) Q1 EPS loss (15c) vs. est. loss (10c); Q1 revenue $83.7M vs. est. $78.58M; raises 2021 revenue outlook to $375M, 62% YoY growth vs. est. $369.16M; GMV grew to $566.6 mln during q1 of 2020, up 85%; MAU reached 0.467 mln with a 17% paying to playing MAU ratio

·     T-Mobile (TMUS) Q1 EPS 74c vs. est. 57c; Q1 revenue $19.76B vs. est. $18.9B; Q1 Total net additions of 1.4 million; Postpaid net additions of 1.2 million; and Postpaid phone net additions of 773 thousand; Core Adjusted EBITDA, which is Adjusted EBITDA less lease revenues, is expected to be between $22.8B-$23.2B up from prior $22.6B-$23.1B; raises FY21 postpaid net adds view to 4.4M-4.9M from 4M-4.7M

 

Technology

·     Activision (ATVI) raises its full-year adjusted sales forecast to $8.60B from $8.45B (est. $8.55B) after posts Q1 adjusted revenue of $2.07B, beating expectations of $1.78B; records a 60% jump in in-game net bookings for “Call of Duty” on console and personal computer; says its Q1 results benefited from strength in all of the company’s franchises

·     Akami (AKAM) 1Q adj EPS $1.38 vs. est. $1.30 on revs $843Mm vs. est. $829.6Mm; qtrly security group revs $310Mm +29%, qtrly technology group revs $532Mm; raises FY21 EPS view to $5.45-$5.52 from $5.33-$5.46 and ups FY21 revenue view to $3.4B-$3.44B from $3.37B-$3.42B

·     Alarm.com Holdings (ALRM) 1Q adj EPS $0.50 vs. est. $0.38 on revs $172.5Mm vs. est. $154.3Mm; guides FY revs $680.5-691Mm vs. est. $669Mm; sees FY adj EPS $1.63-1.72 vs. est. $1.67

·     Alteryx Inc. (AYX) Q1 EPS loss (8c) vs. est. loss (23c); Q1 revs $118.8M vs. est. $106.11M; sees FY21 non-GAAP EPS (7c)-7c vs. est. 2c; sees FY21 revenue $565.0M-$575.0M vs. est. $560.25M; sees FY21 non-GAAP loss from operations ($5.0M)-$5.0M

·     Arista Networks (ANET) 1Q adj EPS $2.50 vs. est. $2.38 on revs $667.6Mm vs. est. $642.1Mm; guides 2Q revs $675-695Mm vs. est. $650Mm

·     Cardlytics (CDLX) 1Q adj EPS ($0.34) vs. est. $0.34 on revs $53.2Mm vs. est. $51.2Mm; sees FY revs $260-285Mm vs. est. $265.8Mm, sees FY billings $380-420Mm

·     Infinera Corp. (INFN) 1Q adj EPS ($0.03) vs. est. ($0.06) on revs $331.9Mm vs. est. $331.5Mm; guides 2Q adj revs $335-355Mm vs. est. $343.2Mm, adj gr mgn 35-37%, adj op ex $125-129Mm, adj op mgn -3% to +1%

·     Lattice Semiconductor (LSCC) Q1 EPS 22c vs. est. 19c; Q1 revenue $115.7M vs. est. $110.14M; sees Q2 revenue $116M-$124M above consensus $111.46M

·     LivePerson (LPSN) Q1 EPS loss (31c) vs. est. loss (14c); Q1 revenue $107.9M vs. est. $103.06M; raises FY21 GAAP EPS view to ($1.90)-($1.78) from ($2.03)-($1.91) and boosts FY21 revenue view to $460M-$468M from $458M-$466M

·     Monolithic Power (MPWR) 1Q adj EPS $1.46 vs. est. $1.34 on revs $254.5Mm vs. est. $242.8Mm

·     RingCentral (RNG) 1Q adj EPS $0.27 vs. est. $0.25 on revs $352Mm vs. est. $339.9Mm; guides 2Q adj EPS $0.27-0.28 vs. est. $0.27, sees FY adj EPS $1.24-1.27 vs. est. $1.23

·     Sprout Social (SPT) Q1 adj EPS loss (5c) vs. est. loss (10c); Q1 revenue $40.8M vs. est. $39.73M; total ARR was $172.0 million, up 38% compared to Q1’20; sees FY21 adj EPS loss (35c)-(34c) vs. est. (38c); sees FY21 revenue $176M-$177M vs. est. $172.84M

·     Upwork (UPWK) Q1 EPS loss (3c) vs. est. loss (4c); q1 revs rose 37% to $113.6M vs. est. $108.7M; sees Q2 revs $119M-$121M vs. est. $114M; sees FT21 revs $480M-$490M vs. est. $466.7M

·     Veeco Instruments (VECO) 1Q adj EPS $0.25 vs. est. $0.23 on revs $133.7Mm vs. est. $125.6Mm; guides 2Q revs $125-145Mm vs. est. $130.2Mm, sees 2Q adj EPS $0.17-0.35 vs. est. $0.26

·     Verisk Analytics (VRSK) 1Q adj EPS $1.23 vs. est. $1.25 on revs $726.1Mm vs. est. $725.6Mm

·     Workiva (WK) 1Q EPS ($0.15 on revs $104.2Mm; guides 2Q revs $101-102Mm vs. est. $99.1Mm, sees FY revs $418-420Mm vs. est. $410.6Mm; guides FY adj EPS loss $0.15-0.19 vs. est. loss $0.28