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Coffee With Greta: PPI Runs Hot


DJIA Futures: -103 (-0.3%)

SPX Futures: -4 (-0.1%)

NASDAQ Futures: +32 (+0.2%)

Good morning friends!

Futures are mixed after the release of more hot inflation data. 

Let’s get right to it!

Yields Spike After Hot PPI

Treasury yields are popping this morning after more hot inflation data was released. 

The Bureau of Labor Statistics’ producer price index rose 0.3% monthly and 0.9% annually. 

That was higher than expectations for a 0.1% monthly and 0.6% annual increase. 

The core PPI rose 0.5% monthly vs 0.1% expected. 

This data comes days after the CPI also increased more than expected.

The PPI is a leading indicator for consumer prices, signaling inflation may not be slowing as quickly as the Fed was hoping. 

The 10-year Treasury yield is up nine basis points at 4.32% while the 2-year yield is up 10 basis points at 4.68%.

Housing Starts, Building Permits Fall

New home construction slowed more than expected at the start of the year. 

The Census Bureau reported housing starts dropped 14.8% in January to a seasonally adjusted annual rate of 1.33 million units. 

It was the lowest level of starts since August 2023 and slower than expectations for a rate of 1.45 million units. 

Single-family starts fell 4.7% while multi-family starts tumbled 35.8%. 

The number of new permits issued last month also dropped more than expected.

Permits fell 1.5% to a seasonally adjusted annual rate of 1.47 million units vs 1.5 million expected. 

Single-family permits rose 1.6% while multi-family permits dropped 9%.

Coinbase Jumps After Surprise Profit

Coinbase (COIN) shares are up 13.5% ahead of the open after reporting a surprise profit in Q4. 

Here’s how the crypto platform’s results compared to analysts’ estimates: 

  • EPS: $1.04 vs $0.01 loss expected
  • Revenue: $954 million vs $822 million expected

It’s the first time Coinbase has reported a profit since Q4 2021.

Net revenue jumped nearly 50% year over year. 

Trading volume nearly doubled from Q3 to $154 billion, including $29 billion from retail traders and $125 billion from institutions. 

That topped expectations for overall volume of $142.7 billion. 

Roku Tumbles After Q4 Miss

Roku (ROKU) shares are plunging 17.9% in premarket trade after reporting a wider-than-expected loss in the fourth quarter. 

Here’s how the streaming platform’s results compared to analysts’ estimates: 

  • Loss per share: $0.55 vs $0.52 expected
  • Revenue: $984 million vs $968 million expected

Roku forecast $850 million in Q1 revenue and expects to break even on adjusted ebitda. 

That was better than analysts’ estimates for $829 million in revenue and an $11 million adjusted ebitda loss. 

In a letter to shareholders the company said, “We plan to increase revenue and free cash flow and achieve profitability over time. At the same time, we remain mindful of near-term challenges in the macro environment and an uneven ad-market recovery.”

DoorDash Drops After Earnings

DoorDash (DASH) shares are down 9% ahead of the open after reporting mixed Q4 results. 

Here’s how the delivery company’s results compared to analysts’ estimates: 

  • Per share loss: $0.39 vs $0.16 expected
  • Revenue: $2.3 billion vs $2.25 billion expected

Revenue jumped 23% year over year.

Gross order volume rose 22% to $17.6 billion vs $17.29 billion expected. 

Total orders rose 23% to 574 million vs 561 million expected. 

DoorDash forecast Q1 gross order volume of between $18.5 billion and $18.9 billion with adjusted ebitda between $320 million and $380 million. 

Analysts were anticipating $18.6 billion in gross orders and $362 million in adjusted ebitda.

For the full-year, the company expects gross order volume between $74 billion and $78 billion, with adjusted Ebitda ranging from $1.5 billion to $1.9 billion. 

Analysts are expecting $76.8 billion in gross orders and adjusted ebitda of $1.63 billion. 

DoorDash also announced a $1.1 billion stock buyback. 

The company said, “In 2024, our focus will not change. We will invest to build tools that solve problems for consumers, merchants, and Dashers, while expanding the scale, breadth, and profit potential of our business. We look forward to the work.”

In Case You Missed It

  • Homebuilder confidence rose more than expected this month. The National Association of Homebuilders sentiment index rose four points to 48 vs 46 expected. This marked the third straight monthly increase and is the highest reading since August 2023. Sentiment about current sales conditions increased four points to 52, six-month sales expectations rose three points to 60, and buyer traffic increased four points to 33.

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