Early Look

Friday, November 10, 2023

Futures	Up/Down	%	Last
Dow	20.00	0.06%	33,964
S&P 500	-4.25	0.10%	4,357
Nasdaq	-41.50	0.27%	15,214

 

 

After snapping winning streaks for the S&P 500 (8-days) and Nasdaq (9-days) on Thursday after a spike in Treasury yields dampened investor sentiment, S&P futures are looking modestly lower overnight as markets are looking at a “flattish” week. The Federal Reserve Chair Jerome Powell and the Treasury market crashed the “rally party” following a weak 30-year bond auction yesterday (weak demand and largest tail on record) at 1:00 when the selling began, and then more “hawkish” commentary from the Fed Chairman at a speech later was the finishing touch on the day. Optimism flowed into the stock market recently after Powell last week said that an run-up in Treasury yields could push up borrowing costs and potentially finish the Fed’s inflation fight without further rate hikes. In Asian markets, The Nikkei Index dropped -78 points to 32,568, the Shanghai Index fell -14 points to 3,038, and the Hang Seng Index declined -308 points to 17,203. In Europe, the German DAX is down -32 points to 15,220, while the FTSE 100 drops -100 points of 1.28% to 7,350. The standout to the downside remains the Russell 2000 Smallcap index, down over -4% this week after a 7% rebound last week but remains down over -4% in 2023 compared to the S&P 500 13% advance YTD and the Nasdaq 29% jump in 2023 thus far. Economic data is light again today, but there are a few more Fed speakers on today’s calendar. Oil is headed for a third consecutive weekly drop amid concern about global demand and the unwinding of the war-risk premium and gold erases last week’s gains given the rebound in the dollar.

 

Market Closing Prices Yesterday

·     The S&P 500 Index slumped -35.43 points, or 0.81%, to 4,347.35.

·     The Dow Jones Industrial Average fell -220.33 points, or 0.65%, to 33,891.94.

·     The Nasdaq Composite dropped -128.97 points, or 0.94%, to 13,521.45.

·     The Russell 2000 Index declined -26.83 points, or 1.57% to 1,687.24.

 

Economic Calendar for Today

·     7:30 AM ET                  Fed’s Logan Speaks at ECB Money Markets Conference

·     9:00 AM ET                  Fed’s Bostic Speaks About Economic Mobility

·     10:00 AM ET                University of Michigan Confidence, Nov-P

·     1:00 PM ET                   Baker Hughes Weekly rig count data

 

Other Key Events:

·     American Association for the Study of Liver Disease’s Annual Liver Meeting, 11/10-11/14, in Boston, MA

 

 

Macro	Up/Down	Last
Nymex	0.79	76.53
Brent	0.83	80.84
Gold	-16.80	1,953.00
EUR/USD	0.0008	1.0674
JPY/USD	0.10	151.44
10-Year Note	+0.012	4.642%

 

 

Sector News Breakdown

Consumer

·     Flowers Foods (FLO) Q3 adj EPS $0.29 vs. est. $0.28; Q3 revs $1.2B vs. est. $1.21B; backs FY23 adj EPS view $1.18-$1.25 (est. $1.22) while cuts FY23 revenue view to $5.085B-$5.104B from $5.095B-$5.141B (below est. $5.12B).

·     Groupon Inc. (GRPN) Q3 adj EPS $0.12 vs. est. $0.11; Q3 revs $126.5M vs. est. $129.6M; Q3 adj Ebitda $18.2M vs. est. $22.7M; co-founder Lefkofsky resigns from board; said plan to raise ~$100M via equity offering, asset sales.

·     Light & Wonder (LNW) Q3 EPS $0.81 vs est. $0.41, adj EBITDA $286Mm vs est. $261.11Mm on revs $731Mm vs est. $717.31Mm.

·     Wynn Resorts (WYNN) Q3 adj EPS $0.99 vs est. $0.75, adj EBITDA $530.4Mm vs est. $495.16Mm on revs $1.67B vs est. $1.585B.

·     Macau casino stocks sank the most since March 2022, led by slump in Wynn Macau Ltd., after disappointing earnings. Wynn Macau tumbled 14% on Friday, after third quarter earnings missed estimates, dragged by higher-than-expected operating expenses.

 

Energy, Industrials and Materials

·     Archer Aviation (ACHR) Q3 adj EBITDA ($64.8)Mm vs est. ($76.93)Mm; sees Q4 op exp $100-110Mm, adj op exp $75-85Mm.

·     Plug Power (PLUG) Q3 EPS ($0.47) vs est. ($0.31) on revs $199Mm vs est. $228.18Mm; Sales of fuel cell systems, related infrastructure, and equipment $145.1M, -8.1% y/y, vs. est. $172.6M

 

Financials

·     Alarm.com Holdings (ALRM) Q3 adj EPS $0.56 vs est. $0.40, adj EBITDA $41.4Mm vs est. $31.16 on revs $221.9Mm vs est. $224.07Mm; sees Q4 total revs $878.9-881.1Mm vs est. $881.1Mm, adj EBITDA $143-144Mm vs est. $129.91Mm and adj EPS $1.90-1.92 vs est. $1.70.

·     AllianceBernstein L.P. (AB) preliminary assets under management decreased to $652 billion during October 2023 from $669 billion at the end of September. The 2.5% AUM decrease was primarily due to market depreciation, coupled with net outflows.

·     Artisan Partners Asset Management Inc. (APAM) preliminary assets under management as of October 31, 2023, totaled $132.2 billion.

·     Franklin Resources, Inc. (BEN) preliminary month-end assets under management (AUM) of $1.33 trillion on October 31, 2023, compared to $1.37 trillion at September 30, 2023. This month’s decrease in AUM reflected the impact of negative markets and long-term net outflows.

·     Invesco Ltd. (IVZ) preliminary month-end assets under management (AUM) of $1,450.5 billion, a decrease of 2.5% versus the previous month-end. The firm experienced net long-term outflows of $0.1 billion in the month.

·     Lazard Ltd (LAZ) preliminary assets under management as of October 31, 2023 totaled approximately $220.1 billion. The month’s AUM included market depreciation of $5.3 billion, net outflows of $2.4 billion and foreign exchange depreciation of $0.5 billion.

·     NCR Voyix Corporation (VYX) Q3 adj EPS $0.95 vs. est. $0.94; Q3 revs rose 2.3% y/y to $2.02B vs. est. $2.03B; Payments & Network revenue $357M, +6.3% y/y and Self-Service Banking revenue $666M, +4.1% y/y; Q3 Adj EBITDA of $404M, increase of 5% on a constant currency basis.

·     Shift4 Payments (FOUR) files to sell 3.51M shares of Class A common stock for holders.

·     Verra Mobility (VRRA) Q3 adj EPS $0.29 vs est. $0.27, adj EBITDA $97.4Mm vs est. $96.26Mm on revs $209.9Mm vs est. $209Mm; guides FY revs upper end $800-810Mm vs est. $806.21Mm, adj EBITDA upper end $365-370Mm vs est. $369.05Mm, adj EPS $1.05-1.10 vs prior $1.00-1.10.

·     Victory Capital Holdings, Inc. (VCTR) assets under management (AUM) of $148.9 billion as of October 31, 2023, and average assets under management for October of $151.3 billion.

·     Virtus Investment Partners, Inc. (VRTS) preliminary assets under management of $155.8 billion as of October 31, 2023. In addition, the company provided services to $2.4 billion of other fee-earning assets, which are not included in assets under management.

 

Healthcare

·     Doximity (DOCS) Q2 adj EPS $0.22 vs est. $0.18, adj EBITDA $54.2Mm vs est. $45.3Mm; sees Q3 revs $127-128Mm vs est. $121.98Mm, adj EBITDA $61-62Mm vs est. $56.79Mm; sees FY revs $460-472Mm vs est. $458.23Mm and adj EBITDA $207-219Mm vs est. $200.41Mm.

·     Hologic (HOLX) Q4 EPS $0.89 vs. est. $0.84; Q3 revs $945.3M vs. est. $940.0M; sees FY24 EPS $3.90-$4.10 vs. est. $3.95 and sees FY24 revenue $3.92B-$4.02B vs. est. $4.08B; enters $500M accelerated buyback; Q4 Diagnostics revenue decreased (20.1%), or (20.6%) in constant currency, primarily driven by lower sales of COVID-19 assays.

·     Illumina (ILMN) Q3 adj EPS $0.33 vs. est. $0.14; Q3 revs $1.12B vs. est. $1.13B; Q3 cash & cash equivalents $927M, below ests; Shipped 97 NovaSeq X instruments in Q3; expect FY23 revs to decrease 2% to 3% y/y; including Core Illumina revenue to decrease 3% to 4% 7/7 and GRAIL revenue at the low end of the $90M-$110M range.

·     Mettled-Toledo (MTD) Q3 adj EPS $9.80 vs est. $9.74, adj EBIT $296Mm vs est. $287.94Mm on revs $942.462Mm vs est. $949.9Mm; sees Q4 local currency sales decline 7-8% vs est. decline 2.85% reported and adj EPS $10.50-10.70 vs est. $11.94.

·     RxSight (RXST) Q3 adj EPS ($0.19) vs est. ($0.43) on revs $22.2Mm vs est. $20.55Mm; sees FY revs $85-87Mm vs prior $81-86Mm and est. $83.93Mm, gr mgn 60-61% vs prior 58-60%.

·     Walgreens Boots Alliance Inc. (WBA) said it had sold shares of drug distributor Cencora Inc. (COR) for approximately $424M and entered a share repurchase by Cencora, formerly known as AmerisourceBergen, for proceeds of roughly $250 million.

 

Technology, Media & Telecom

·     Applied Optoelectronics (AAOI) Q3 EPS loss (-$0.05), in-line with estimates and revs rose 10% y/y to $62.55M, matches consensus $62.61M; sees Q4 EPS loss (-$0.02) to +$0.04 vs. est. loss (-$0.04) and sees Q4 revenue $63M-$67M vs. est. $64.8M.

·     DoubleVerify Holdings (DV) Q3 revs $144M vs. est. $138.9M; sees Q4 revenue $170M-$174M, vs. est. $171.32M and adj EBITDA $57M-$61M; sees FY23 revenue $570M-$574M vs. est. $566.42M.

·     Everbridge (EVBG) Q3 adj EPS $0.46 vs. est. $0.42; Q3 revs $114.2M vs. est. $113.73M; backs FY23 adjusted EPS view $1.48-$1.52 (est. $1.49) but lowers FY23 revenue view to $447M-$448.5M from $450M-$452M.

·     News Corp. (NWSA) Q1 adj EPS $0.16 vs. est. $0.10; Q1 revs $2.5B vs est. $2.47B; Q1 segment Ebitda $364M vs. est. $323.3M.

·     Onto Innovation (ONTO) Q3 adj EPS $0.96 vs est. $0.95 on revs $207.185Mm vs est. $215.2Mm, gr mgn 52%; guides Q4 revs $200-216Mm vs est. $215.26Mm, adj EPS $0.90-1.10 vs est. $1.01.

·     Synaptics (SYNA) Q1 adj EPS $0.52 vs est. $0.40 on revs $237.7Mm vs est. $239.82Mm, adj gr mgn 53%; guides Q2 revs $220-250Mm vs est. $239.82Mm, adj gr mgn 51.0-54.0%, adj op exp $95-99Mm.

·     Trade Desk (TTD) shares slide over -25%; Q3 adj EPS $0.33 vs. est. $0.29; Q3 revs $493M vs. est. $487M; Q3 adj Ebitda margin 40%; guides Q4 revs at least $580M vs. est. $610.4M and sees Q4 adj Ebitda of about $270M.

·     Unity Software (U) Q3 revs $544M vs. est. $553.7M; Q3 adj Ebitda $131M vs. est. $96.3M; said not providing Q4 or 2023 guidance; said may discontinue products, cut staff, and cut office space.

·     Navitas Semi (NVTS) Q3 adj op loss $8.7Mm vs est. loss $10.36Mm on revs $22.0Mm vs est. $21.0Mm; guides Q4 revs $25-26Mm vs est. $24.91Mm, gr mgn 42.2-42.8%.

·     TKO Group (TKO) 8.4M share Spot Secondary priced at $79.80.