Coffee With Greta: Tech Bounce
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DJIA Futures: +66 (+0.2%)
SPX Futures: +21 (+0.5%)
NASDAQ Futures: +108 (+0.7%)
Good morning friends!
Futures are rising as tech stocks continue to rally.
Let’s get right to it!
More Bank Downgrades
Several banks were downgraded by S&P Global late Monday night.
Trading in both the Financial Select Sector SPDR ETF (XLF) and SPDR S&P Regional Banking ETF (KRE) is halted premarket.
S&P Global downgraded Associated Banc-Corp (ASB) and Valley National Bancorp (VLY) on funding risks and a higher reliance on brokered deposits.
The agency also cute the ratings of UMB Financial Corp (UMBF), Comerica Bank (CMA), and Keycorp (KEY), citing large deposit outflows and prevailing higher interest rates.
S&P Global warned that funding risks and weaker profitability will likely test the banking sector’s credit strength.
This move comes after Moody’s downgraded 10 banks earlier this month and placed six large banks on review for potential downgrades.
Lowe’s Tops Q2 Earnings Estimates
Lowe’s (LOW) shares are up 2.8% ahead of the open after beating Q2 profit expectations.
Here’s how the home improvement retailer’s results compared to analysts’ estimates:
- EPS: $4.56 vs $4.49 expected
- Revenue: $24.96 billion vs $24.99 billion expected
Comparable sales decreased 1.6% year over year, better than expectations for a 2.6% decline.
Lowe’s maintained its full-year forecast for adjusted EPS between $13.20 and $13.60 on sales between $87 billion and $89 billion.
The company expects comparable sales to drop between 2% and 4% this fiscal year.
Macy’s Earnings Beat
Macy’s (M) shares are falling 4.1% in premarket trade after beating Q2 expectations but reiterating its cautious outlook.
Here’s how the department store’s results compared to analysts’ estimates:
- Adjusted EPS: $.026 vs $0.13 expected
- Revenue: $5.13 billion vs $5.09 billion expected
Comparable sales dropped 7.3% year over year, worse than expectations for a 6.5% decline.
Sales at stores were down 8% while digital sales dropped 10%.
The retailer reiterated its lower forecast from early June.
The company expects full-year comparable sales to fall 6% to 7.5%, adjusted EPS between $2.70 and $3.20, and revenue of $22.8 billion to $23.2 billion.
Dick’s Sporting Goods Slashes Outlook
Dick’s Sporting Goods (DKS) shares are plunging 20.2% ahead of the open after missing Q2 expectations and slashing its outlook.
Here’s how the sporting goods retailer’s results compared to analysts’ estimates:
- EPS: $2.82 vs $3.81 expected
- Revenue: $3.22 billion vs $3.24 billion expected
Profits tumbled 23% year over year while sales rose slightly.
The CEO blamed that profit miss on “shrink”, an industry term that refers to theft.
She said, “Our Q2 profitability was short of our expectations due in large part to the impact of elevated inventory shrink, an increasingly serious issue impacting many retailers.”
Dick’s now expects full-year EPS between $11.33 and $12.13 vs $12.90 to $13.80 previously.
The company reaffirmed its comparable store sales forecast of flat to up 2%.