Early Look

Wednesday, May 11, 2022

Futures	Up/Down	%	Last
Dow	290.00	0.90%	32,377
S&P 500	46.25	1.15%	4,043
Nasdaq	182.00	1.47%	162,531

 

 

U.S. futures are rising around 1% to 4,040, near overnight highs (4,043.75) and Treasury yields are sliding for a third straight day, with the 10-yr down around 2.94% ahead of the CPI reading later this morning. All eyes on key consumer price (CPI) inflation data for April which is expected at 8:30 AM. Investors hoping for peak CPI and/or a possible decline (est. core CPI +0.4% M/M and core prices Y/Y +6% – while headline CPI M/M est. +0.2% and Y/Y +8.1% for April). Producer Prices (PPI) are expected tomorrow morning. The S&P 500 and Nasdaq ended higher on Tuesday, snapping their respective 3-day losing streaks with big growth shares rising after the previous day’s selloff as Treasury yields tumbled (10-yr back below 3% after topping 3.2% Monday). The Dow and the SmallCap Russell 2000 both ended lower in a choppy day of trading. Concerns the Federal Reserve may have to move more aggressively to curb inflation have driven the recent selloff in the market, along with the ongoing lockdowns in China and the Ukraine/Russia was, which is impacting global supply chains/commodities. In Asian markets, The Nikkei Index edged higher 46 points to 26,213, the Shanghai Index rose 0.75% to 3,058, and the Hang Seng Index rose 190 points or nearly 1% to 19,824. In Europe, the German DAX is up 130 points or about 1% to 13,660, while the FTSE 100 rises 1% to 7,315.

Market Closing Prices Yesterday

·     The S&P 500 Index jumped 9.81 points, or 0.25%, to 4,001.05

·     The Dow Jones Industrial Average fell -84.96 points, or 0.26%, to 32,160.74

·     The Nasdaq Composite gained 114.42 points, or 0.98%, to 11,737.67

·     The Russell 2000 Index dipped -0.29 points, or 0.02% to 1,761.79

 

Economic Calendar for Today

·     7:00 AM ET         MBA Mortgage Applications Data

·     8:30 AM ET         Consumer Price Index (CPI) M/M for April…est. +0.2%

·     8:30 AM ET         Consumer Price Index (CPI) Y/Y for April…est. +8.1%

·     8:30 AM ET         CPI Ex: Food & Energy M/M for April…est. +0.4%

·     8:30 AM ET         CPI Ex: Food & Energy Y/Y for April…est. +6.0%

·     10:30 AM ET       Weekly DOE Inventory Data

·     1:00 PM ET         U.S. Treasury to sell $36B in 10-year notes

·     2:00 PM ET         Federal Budget for April

 

Earnings Calendar:

·     Earnings Before the Open: AGFY, AWH, DNUT, ENJY, EVGO, FA, MCFT, ONDS, PFGC, WEN, WTT, WWW, YETI

·     Earnings After the Close: APP, ASYS, BMBL, BROS, BYND, COCO, COOK, CYCC, DAVE, DIS, EVLV, FORG, FOSL, GAIN, HLTH, LUCD, MQ, MRAM, ONTX, RIVN, SCM, SMRT, SOND, SONO, STE, VCSA, WATT

 

Other Key Events:

·     BMO Capital Real Estate Summit, 5/11-5/12 in NY

·     BTIG Annual Housing Ecosystem Conference, 5/10-5/11 in NY

·     Citigroup Global Energy, Utilities and Climate Technology Conference, 5/10-5/11, in Boston

·     Goldman Sachs Industrials & Materials Conference, 5/10-5/12, in NY

·     UBS Pan European Small & Mid-Cap Conference, 5/10-5/12, in London

 

 

Macro	Up/Down	Last
Nymex	3.00	102.76
Brent	3.13	105.59
Gold	9.70	1,850.70
EUR/USD	0.0027	1.0555
JPY/USD	-0.59	129.84
10-Year Note	-0.053	2.94%

 

 

World News

·     China April consumer prices (CPI) rise +2.1% Y/Y vs. est. +1.8%; Chinese CPI M/M actual +0.4% vs. est. +0.2% and previous 0.0%

·     China April producer prices rise 8.0% Y/Y vs. est. 7.8%

·     The House of Representatives passed a package of about $40 billion in additional aid money for Ukraine Tuesday night, $7 billion more than President Joe Biden requested from Congress.

 

Sector News Breakdown

Consumer

·     Allbirds (BIRD) 1Q EPS ($0.15) vs est. ($0.12) on revs $63Mm vs est. $62Mm; says expect headwinds will continue to impact international biz 2Q thru end of year; sees FY revs +21-24% vs est. +30.6%

·     Boot Barn (BOOT) 4Q adj EPS $1.47 vs est. $1.32 on revs $383.3Mm vs est. $355.2Mm, comps +33%

·     Calloway Golf (ELY) 1Q adj EPS $0.36 vs est. $0.24 on revs $1.04B vs est. $1.02B; guides 2Q revs $1.085-1.105B vs est. $1.013B and FY revs $3.935-3.97B vs est. $3.83B

·     Canoo (GOEV) files $300M universal shelf; sees doubt about ability to continue as a going concern

·     Darling Ingredients (DAR) Q1 EPS $1.14 vs. est. $1.12; Q1 revs $1.37B vs. est. $1.29B; forecasts full year 2022 combined adjusted EBITDA at $1.55-$1.6 billion

·     Grocery Outlet (GO) 1Q adj EPS $0.22 vs est. $0.20, adj EBITDA $49.3Mm vs est. $45.8Mm on revs $831.4Mm vs est. $810.4Mm; guides FY net sales $3.39-3.42B vs est. $3.36B, comps +5.5-6.5%, adj EBITDA $213-220Mm vs est. $215Mm; adj EPS $0.94-0.99 vs est. $0.95

·     PLBY Group (PLBY) 1Q adj EBITDA $1.2Mm vs est. $5.6Mm on revs $69.4Mm vs est. $68.5Mm

·     Purple Innovation (PRPL) Q1 adj EPS loss (-$0.24) vs. est. loss (-$0.35); Q1 revs $143.2M vs. est. $129.26M; lowers FY22 net revs to $650M-$690M, vs. prior range of $790M-$830M (est. $747M); sees adjusted EBITDA for 2022 between $21M-$27M, compared with its prior range of $26M-$33M and compared with 2021 adjusted EBITDA of $11.0M

·     RealReal (REAL) Q1 EPS loss (-$0.47) vs. est. loss (-$0.51); Q1 revs rose 48% to $146.7M vs. est. $136.82M; Q1 GMV was $428 million, an increase of 31% compared to the same period in 2021; guides year revs $635M-$665M vs. est. $644.5M

·     Wynn Resorts (WYNN) 1Q adj EPS ($1.21) vs est. ($1.15), adj EBITDA $177.6Mm vs est. $161.8Mm on revs $953.3Mm vs est. $986.4Mm

 

Energy, Industrials and Materials

·     The American Petroleum Institute (API) reports that crude inventories rose 1.618M barrels last week. Gasoline inventories rose 823,000 barrels; Cushing +92k and Distillates +662k

·     Array Technologies, Inc. (ARRY) 1Q EPS ($0.23) vs est. ($0.06) on revs $300.6Mm vs est. $271.6Mm; guides FY revs $1.3-1.5B

·     Axon Enterprise (AXON) 1Q adj EPS $0.45 vs est. $0.30, adj EBITDA $49Mm vs est. $30.1Mm on revs $256Mm vs est. $231.4Mm; guides FY revs $1.05-1.1B vs est. $1.05B and prior $1.04B; sees FY adj EBITDA $190-200Mm vs est. $191.9Mm and prior $185-195Mm

·     Occidental Petroleum (OXY) Q1 EPS $2.12 vs. est. $2.03; qtrly oil and gas pre-tax income on cont ops was $2.9 bln, vs to pre-tax income of $2.1 billion for q4 2021; total average global production of 1,079 thousand of barrels of oil equivalent per day (MBoed) for Q1; qtrly average worldwide realized crude oil prices increased by about 22% from the prior quarter to $91.91 per barrel; raises annual outlook for its midstream business to a profit of about $225M from a $225M loss

 

Financials

·     Coinbase (COIN) shares fall -15% (after roughly 40% over the last 4-trading days into earnings); Q1 revs $1.17B vs. est. $1.48B; Q1 trading volume $309B vs. $335B; MTUS in Q1 were 9.2 million, a decrease of 2.2 million or 19% compared to Q4; Q1 continued a trend of both lower crypto asset prices and volatility that began in late 2021; files automatic mixed securities shelf

·     H&R Block (HRB) Q3 continuing ops EPS $4.06 vs. est. $3.75; Q3 revs $2.1B vs. est. $1.94B; raises FY22 revenue view to $3.375B-$3.425B from $3.25B-$3.35B (est. $3.3B); raises year Ebitda view to $850M-$875M from prior $765M-$815M

·     AllianceBernstein L.P. (AB) announced that preliminary assets under management decreased to $685 billion during April 2022 from $735 billion at the end of March. The 7% decrease was primarily due to market depreciation, coupled with firm-wide net outflows.

·     Invesco Ltd. (IVZ) reported preliminary month-end assets under management (AUM) of $1,476.1 billion, a decrease of 5.1% versus previous month-end. The firm experienced net long-term outflows of $1.3 billion in the month. Non-management fee earning net outflows were $1.4 billion and money market net inflows were $15.2 billion.

·     Rocket Companies (RKT) 1Q adj EPS $0.15 vs est. $0.19 on revs $2.7B vs est. $2.2B; guides 2Q closed loan volume $35-40B, net rate lock volume $31-38B, gains on sale margins 2.6-2.9%

·     Welltower (WELL) 1Q adj FFO/shr $0.82 vs est. $0.83 on revs $1.4B vs est. $1.35B

·     Ziff Davis (ZD) 1Q adj EPS $1.23 vs est. $1.21 on revs $315.1Mm vs est. $319.5Mm; reaffirms FY guide

 

Healthcare

·     Roche (RHHBY) shares fell after announced a failure to reach its primary endpoint of progression-free survival in a Phase 3 trial to address non-small-cell lung cancer; Roche said it would continue the trial. In a study, a combination of tiragolumab and Roche’s established Tecentriq drug did not slow disease progression in newly diagnosed cases of advanced non-small-cell lung cancer when compared with patients on Tecentriq only (what shares of RCUS, ITOS)

·     AstraZeneca (AZN), Sanofi’s (SNY) said a pooled analysis from two studies showed 79.5% efficacy of their single dose antibody nirsevimab against lower respiratory tract infections

·     Globus Medical (GMED) 1Q EPS $0.42 vs est. $0.47 on revs $230.5Mm vs est. $234.2Mm; sees FY revs $1.025B vs est. $1.027B, adj EPS $2.10 vs est. $2.10

·     Halozyme Therapeutics, Inc. (HALO) 1Q adj EPS $0.47 vs est. $0.49 on revs $117.3Mm vs est. $128.3Mm; guides FY EPS $2.05-2.20 vs est. $2.23, revs $530-560Mm vs est. $566.2Mm

·     NanoString technologies (NSTG) 1Q EPS ($0.86) vs est. ($0.57) on revs $31.08Mm vs est. $33.6Mm; guides FY product and service revs $150-160Mm vs prior $170-180Mm, geomx dsp revs $60-65Mm vs prior $73-78Mm, ncounter revs (inclusive of all service revs) $90-95Mm vs prior $55-65Mm; sees adj EBITDA ($65Mm)-($75Mm) vs prior ($55Mm)-($65Mm)

 

Technology, Internet, Media & Telecom

·     Electronic Arts (EA) Q4 EPS adj EPS $1.46 vs. est. $1.43; Q4 net bookings $1.75B vs. est. $1.77B; Sees Q1 adj revenue $1.2B-$1.25B vs. est. $1.45B; sees FY23 adjusted revenue $7.9B-$8.1B vs. est. $8.0B

·     Fiverr (FVRR) Q1 adj EPS $0.11 vs. est. $0.02; Q1 revs $86.7M in-line with ests; Q1 active buyers as of March 31, 2022 grew 11% Y/Y to 4.2M, vs. 3.8M; cuts FY22 revenue view to $345M-$365M from $373M-$379M (est. $377.24M) and cuts FY22 adj EBITDA to $10M-$17M from $27M-$33M

·     Global Foundries (GFS) 1Q adj EPS $0.42 vs est. $0.23 on revs $1.94B vs est. $1.9B; guides 21Q adj EPS $0.43-0.48 vs est. $0.26, revs $1.955-1.985B vs est. $1.92B; says sold out for 2022 and 2023

·     Matterport (MTTR) Q1 EPS loss (-$0.10) vs. est. loss (-$0.14); Q1 revs rose 6% to $28.5M vs. est. $27.5M; sees Q2 revs $28.5M-430.5M vs. est. $31M; reaffirms prior guidance for year; Q1 total subscribers increased 70% to 562,000 from year-ago period; subscription revenue rose 24% Y/Y

·     Rackspace Technology (RXT) Q1 EPS $0.22 vs. est. $0.21; Q1 revs $775.5M vs. est. $774.49M; sees Q2 EPS $0.15-$0.17 vs. est. $0.23; sees Q2 revs $780M-$790M vs. est. $800.71M

·     Roblox (RBLX) Q1 EPS loss (-$0.27) vs. est. loss (-$0.21); Q1 revs $537.1M vs. est. $645.3M (vs. $387.0M Y/Y); Q1 bookings $631.2M, down 3% Y/Y; Q1 Daily Active Users (DAUs) were 54.1M, an increase of 28% Y/Y; Hours Engaged were 11.8 billion, an increase of 22% Y/Y

·     Switch Inc. (SWCH) 1Q adj EPS $0.04 vs est. $0.06 on revs $164.6Mm vs est. $163.6Mm; maintains FY guidance

·     Trade Desk (TTD) Q1 adj EPS $0.21 vs. est. $0.15; Q1 revs $315.3M vs. est. $304.69M; sees Q2 revenue at least $364M vs. est. $360.34M; sees Q2 adj EBITDA approximately $121M

·     Unity Software (U) shares fall -33%; Q1 EPS loss (-$0.08), in-line with estimates as revs rose 36% to $320M vs. est. $321.4M; Loss from operations was $171.2 million, or 53% of revenue, compared to loss from operations of $110.9 million, or 47% of revenue Y/Y; guides FY revs $1.35B-$1.43B vs. est. $1.49B and Q2 revs $290M-4295M vs. est. $359.7M