Early Look

Thursday, November 16, 2023

Futures	Up/Down	%	Last
Dow	-15.00	0.04%	35,035
S&P 500	-3.25	0.08%	4,515
Nasdaq	-36.50	0.23%	15,852

 

 

Nasdaq futures are edging lower after Dow component CSCO falls -11% slashed its year earnings and revenue outlook, while software names dip after PANW reported better results but billings guidance weight on security software stocks. The S&P futures are flat however, holding its recent strong gains rising 11 of the last 13 trading days and up more than 10% from its October lows as recent lower inflation data (CPI and PPI) has boosted the expectations of the Fed done with rate hikes during this long rate hike cycle. Another busy day of data coming up with jobless claims, import prices, industrial production, Philly survey and housing data, along with a bevy of Fed speakers and tons of Wall Street conferences taking place. In Asian markets, The Nikkei Index declined -95 points to 33,424, the Shanghai Index dropped -21 points to 3,050, and the Hang Seng Index fell -246 points to 17,832. In Europe, the German DAX is up 55 points to 15,800, while the FTSE 100 is down -35 points to 7,450. In Washington DC overnight, the US Senate overwhelmingly approved a temporary funding measure to avert a government shutdown, delaying a partisan clash over federal spending until the new year and leaving out emergency aid to allies Ukraine and Israel. The 87-11 vote late Wednesday night sends the measure, already passed by the House, to President Joe Biden

 

Economic Calendar for Today

·     8:30 AM ET                  Weekly Jobless Claims…est. 220K

·     8:30 AM ET                  Continuing Claims…est. 1.847M

·     8:30 AM ET                  Import Prices M/M for October…est. (-0.3%)

·     8:30 AM ET                  Export Prices M/M for October…est. (-0.5%)

·     8:30 AM ET                  Philly Fed Business Index for November…est. (-9.0)

·     8:30 AM ET                  Fed’s Mester Delivers Opening Remarks

·     9:15 AM ET                  Industrial Output M/M for October…est. (-0.3%)

·     9:15 AM ET                  Capacity Utilization for October…est. 79.4%

·     9:25 AM ET                  Fed’s Williams Speaks at US Treasury Market Conference

·     10:00 AM ET                NAHB Housing Market Index for November…est. 40

·     10:30 AM ET                Weekly EIA Natural Gas Inventory Data

·     10:35 AM ET                Fed’s Barr Speaks at US Treasury Market Conference

·     11:00 AM ET                Kansas City Fed Manufacturing for November

·     11:45 AM ET                Fed’s Mester Delivers Introductory Remarks

·     4:00 PM ET                   Net Long-term TIC Flows for September

 

Earnings Calendar:

·     Earnings Before the Open: BBWI BERY BRC BV M ONEW SCVL SR SSYS WMG WMT WSM

·     Earnings After the Close: AMAT AMSWA BZH CMP DLB ESE GEOS GPW MATW NGVC POST ROST UGI WWD

 

Other Key Events:

·     DA Davidson Technology Summit 11/16, in New York, NY

·     Deutsche Bank Gaming, Lodging, Leisure Conference, 11/16-11/17, in Miami, FL

·     Goldman Sachs Global Metals and Mining Conference 2023, 11/15-11/16, in New York

·     JMP Securities Financial Services Conference, 11/16 in New York

·     Needham 17th Annual Security, Networking, & Comm Conference (virtual), 11/14-11/16

·     Oppenheimer Internet Bus Tour (virtual), 11/16-11/20

·     Piper 16th East Coast Financial Services Conference, 11/15-11/16, in Florida

·     RBC Capital Technology, Internet, Media & Telecom Conference, 11/14-11/16, in New York

·     Stephens Annual Investment Conference, 11/13-11/16, in Nashville, TN

 

Market Closing Prices Yesterday

·     The S&P 500 Index edged higher 7.22 points, or 0.16%, to 4,502.92.

·     The Dow Jones Industrial Average rose 163.91 points, or 0.47%, to 34,991.61.

·     The Nasdaq Composite gained 9.45 points, or 0.07%, to 14,103.84.

·     The Russell 2000 Index advanced 2.90 points, or 0.16% to 1,801.22.

 

 

Macro	Up/Down	Last
Nymex	-0.28	76.38
Brent	-0.15	81.03
Gold	3.60	1,967.90
EUR/USD	-0.000	1.0847
JPY/USD	-0.14	151.21
10-Year Note	-0.043	4.494%

 

 

Sector News Breakdown

Consumer

·     Gambling.com (GAMB) Q3 EPS $0.13 vs est. $0.10 on revs $23.458Mm vs est. $22.24Mm, adj EBITDA $6.054Mm vs est. $6.213Mm.

·     J&J Snack Foods (JJSF) Q4 adj EPS $1.73 vs est. $1.72 on sales $443.863Mm vs est. $421.1Mm, adj EBITDA $62.2Mm vs est. $61.66Mm.

·     Pulte Homes (PHM) raises its quarterly dividend by 25% to $0.20 from $0.16.

·     Shoe Carnival (SCVL) lowered its FY sales view to $1.16B-$1.18B from prior $1.19B-$1.21B view and adj EPS view to $2.65-$2.75 from prior $3.10-$3.25 amid ongoing softness and uncertainty over consumer spending during the holiday season.

 

Energy, Industrials and Materials

·     Hillenbrand (HI) Q4 adj EPS $1.13 vs est. $1.04 on revs $763Mm vs est. $747.46Mm, adj EBITDA mgn 19.3%; guides Q1 adj EPS $0.66-0.71 vs est. $0.81; sees FY24 revs $3.28-3.44B vs est. $3.177B, adj EBITDA $530-588Mm vs est. $532.63Mm and adj EPS $3.60-3.95 vs est. $3.87.

·     Maximus Inc. (MMS) Q4 adj EPS $1.29 vs. est. $1.32; Q4 revs $1.26B vs. est. $1.27B; guides FY24 EPS $5.05-$5.35 vs. est. $5.33 and sees FY24 revenue $5.05B-$5.20B vs. est. $5.18B.

·     Maxeon Solar (MAXN) Q3 EPS loss (-$2.21) vs. est. loss (-$0.93); Q3 revs $227.6M vs. est. $227.07M; guides Q4 revs $220M-$260M vs. est. $278.3M and adj Ebitda loss (-$27M-$37M); said all outstanding disputes with SunPower (SPWR) regarding the master supply agreements between the two companies have been resolved.

·     Tetra Tech Inc. (TTEK) Q4 adj EPS $1.78 vs est. $1.44 on revs $1.26B vs est. $990.8Mm; sees Q1 revs $950Mm – $1B vs est. $960.05Mm and EPS $1.30-1.38 vs est. $1.36; sees FY revs $4.05-4.25B and EPS $5.70-6.00 vs est. $5.79.

 

Financials

·     PayPal Holdings Inc. (PYPL) is continuing an overhaul of its upper leadership under new Chief Executive Officer Alex Chriss, naming three business unit-focused leaders just weeks after appointing a new finance chief.

·     Robinhood Markets Inc (HOOD) said net cumulative funded accounts at end of October were 23.3M, up about 30 thousand from September 2023; assets under custody at end of October were $84.6B, down 2% from September 2023.

·     StoneX Group (SNEX) Q4 EPS $2.36 vs est. $2.26 on operating revs $778Mm; ROE 15%.

 

Healthcare

·     CRISPR Therapeutics (CRSP) and partner Vertex Pharmaceuticals (VRTX) said that the UK’s Medicines and Healthcare products Regulatory Agency (MHRA) has granted conditional marketing authorization for the gene therapy Casgevy to treat blood disorders.

·     SpringWorks Therapeutics (SWTX) announced positive topline results from the pivotal Phase 2b ReNeu trial evaluating mirdametinib, an investigational MEK inhibitor, in pediatric and adult patients with neurofibromatosis type 1-associated plexiform neurofibromas, or NF1-PN..

 

Technology, Media & Telecom

·     Cisco Systems (CSCO) Q1 adj EPS $1.11 vs est. $1.03 on revs $14.7B vs est. $14.615B, adj op mgn 36.6%; sees Q2 revs $12.6-12.8B vs est. $14.186B and adj EPS $0.82-0.84 vs est. $0.99; sees FY revs $53.8-55.0B vs est. $57.756B and cuts adj EPS to $3.87-3.93 from $4.01-$4.08 – est. $4.05.

·     Shares of other networking stocks such as Juniper (JNPR) and Arista Networks (ANET) are lower pre mkt after CSCO flagged a slowdown in new product orders in Q1 and said customers were currently focused on installing products following strong deliveries over the past three quarters.

·     Palo Alto Networks (PANW) Q1 EPS $1.38 vs. est. $1.16; Q1 revs rose 20% y/y to $1.9B vs. est. $1.84B; guides FY adj EPS $5.40-$5.53 vs. est. $5.33; forecasts FY billings $10.7B-$10.8B vs. prior outlook $10.9B-$11.0B; sees Q2 EPS $1.29-$1.31 vs. est. $1.25.

·     Alibaba Group (BABA) said it has decided to not proceed with a full spin-off; will focus on developing a sustainable growth model for cloud intelligence group under fluid circumstances; believe that a full spin-off of cloud intelligence group May not achieve intended effect of shareholder value enhancement.

·     Intel (INTC) was upgraded to Buy from Neutral at Mizuho and up tgt to $50 from $37 as believes Intel is lining up significant new server product launches and foundry customer announcements in the next six months.

·     Kulicke & Soffa (KLIC) Q4 adj EPS $0.51 vs. est. $0.43; Q4 revs $202.3M vs. est. $200.16M; raises quarterly dividend to 20c from 19c per share; guides Q1 adj EPS $0.25 plus/minus 10% vs. est. $0.38 and sees Q1 revenue $170M plus/minus $10M vs. est. $190.92M.

·     Sonos Inc. (SONO) announces $200M share buyback; Q4 adj EPS ($0.07) vs est. ($0.18) on revs $305.147Mm vs est. $299.4Mm, adj EBITDA $6.3Mm vs est. $2.806Mm; sees FY24 revs $1.6-1.7B vs est. $1.707B, adj gr mgn 45.4-46.4%, adj EBITDA $150-180Mm vs est. $179.21Mm and adj EBITDA mgn 9.4-10.6%.

·     Universal Technical Institute (UTI) Q4 EPS $0.10 vs est. $0.06 on revs $170.298Mm vs est. $165.93Mm; sees FY24 revs $705-715Mm vs est. $700.26Mm, adj EBITDA $98-102Mm vs est. $90.51Mm and EPS $0.53-0.58 vs est. $0.65.