Coffee With Greta: Rebound Attempt
Register now for today’s free Q&A event on LinkedIn with me and T3 professional trader Brandt Hersh! DJIA Futures: +30 (+0.1%) SPX Futures: +7 (+0.2%) NASDAQ Futures: +24 (+0.2%) Good morning friends! Futures are up slightly as the market looks to rebound. Let’s get right to it! Rivian Tops Expectations, Hikes Production Guidance Rivian (RIVN) shares are down 1.4% ahead of the open despite beating Q2 expectations and raising its full-year production target. Here’s how the electric automaker’s results compared to analysts’ estimates: Loss per share: $1.08 vs $1.41 expected Revenue: $1.12 billion vs $1 billion expected Rivian delivered 12,640 vehicles during the second quarter, up 59% from Q1. The EV maker said it had $10.2 billion in cash on hand at the end of the quarter while capital expenditures decreased on a quarterly basis. The company now expects to build about 52,000 vehicles this year, up from previous guidance for 50,000. SMCI Drops On Weak Outlook Super Micro Computer Inc (SMCI) shares are tumbling 14.8% in premarket trade after beating Q4 expectations but issuing weak guidance. Here’s how the server company’s results compared to analysts’ estimates: Adjusted EPS: $3.51 vs $2.91 expected Revenue: $2.18 billion vs $1.98 billion expected But SMCI expects a spending surge to support AI technology. That contributed to the lower forecast. The company expects Q1 adjusted EPS of $2.75 to $3.50 on revenue of $1.9 billion to $2.2 billion. Analysts were estimating adjusted EPS of $3.21 on $2.2 billion in revenue. Lyft Slips Despite Beat Lyft (LYFT) shares are falling 6.1% ahead of the open despite beating Q2 expectations on the top and bottom line. Here’s how the ride-hailing service’s results compared to analysts’ estimates: Adjusted EPS: $0.16 vs $0.01 loss expected Revenue: $1.021 billion vs $1.02 billion expected Lyft forecast Q3 revenue between $1.13 billion and $1.15 billion vs $1.09 billion expected. The company said, “We saw momentum across use cases, however commute and early-morning trips were standouts, growing by just over 20% year over year. And we had our highest volume of quarterly airport rides since 2019.” Active-riders rose 8% to 21.5 million in the quarter but revenue per ride fell as the company cut prices to attract riders. Roblox Losses Widen Roblox (RBLX) shares are down 8.1% in premarket trade after reporting a larger Q2 loss than expected. Here’s how the video game company’s results compared to analysts’ estimates: Loss per share: $0.46 vs $0.45 expected Bookings: $781 million vs $785 million expected Bookings were up 22% year over year. Roblox reported 65.5 million average daily active users during the quarter, up 25% from a year ago. Those users spent more than 14 billion hours engaged in Roblox, up 24%. Roblox said it expects to continue to report losses for the “foreseeable future.” Mortgage Demand Drops Mortgage demand dropped again last week as rates surged. The Mortgage Bankers Association reported total application volume dropped 3.1% weekly. Purchase applications fell 3% weekly and 27% year over year while refinance applications fell 4% weekly and 37% annually. The average 30-year fixed contract rate jumped to 7.09% from 6.93%. The FHA rate hit 7.02%, the highest since 2002. The higher rates came as Treasury yields rose last week, mortgage rates follow the 10-year yield.
Continue Reading -->Coffee With Greta: Trouble For Banks
Register now for tomorrow’s free Q&A event on LinkedIn with T3 professional trader Brandt Hersh! DJIA Futures: -244 (-0.7%) SPX Futures: -31 (-0.7%) NASDAQ Futures: -107 (-0.7%) Good morning friends! Futures are slipping with bank stocks under pressure. Let’s get right to it! Small Banks Downgraded Both big and small bank stocks are falling ahead of the open after Moody’s cut the credit ratings of several U.S. banks late Monday. The SPDR S&P Regional Banking ETF (KRE) is down 2.8% while the Financial Select Sector SPDR ETF (XLF) is down 1.2%. The downgraded banks included M&T Bank (MTB), Pinnacle Financial (PNF), BOK Financial (BOKF) , and Webster Financial (WBS). Bank of New York Mellon (BK), U.S. Bancorp (USB), State Street (STT), Truist Financial (TFC), Cullen/Frost Bankers (CFR), and Northern Trust (NTRS) are now all under review for a potential downgrade. The firm also changed its outlook to negative for 11 banks, including Capital One (COF), Citizens Financial (CFG), and Fifth Third Bancorp (FITB). Moody’s analysts said, “U.S. banks continue to contend with interest rate and asset-liability management (ALM) risks with implications for liquidity and capital, as the wind-down of unconventional monetary policy drains systemwide deposits and higher interest rates depress the value of fixed-rate assets.” Palantir Drops Despite Strong Guidance Palantir Technologies (PLTR) shares are down 1.1% in premarket trade after reporting Q2 results that were in line with expectations and issuing strong guidance. Here’s how the data-analytics company’s results compared to analysts’ estimates: Adjusted EPS: $0.05 as expected Revenue: $533 million as expected Revenue jumped 13% year over year. Palantir forecast Q3 revenue between $553 million and $557 million vs $552 million expected. The midpoint of that guidance suggests 16% year over year growth. The company expects full-year revenue of over $2.212 billion vs $2.209 billion expected. The CEO wrote in a letter to shareholders, “We anticipate that we will become eligible for inclusion in the S&P 500 after we report our financial results for Q3 2023 in early November. At that point, we will have been profitable on a cumulative basis over the preceding four quarters.” Lucid Slips On Revenue Miss Lucid Group (LCID) shares are down 0.2% ahead of the open after missing Q2 expectations. Here’s how the electric automaker’s results compared to analysts’ estimates: Loss per share: $0.40 vs $0.33 expected Revenue: $150.9 million vs $175 million expected Lucid delivered just 1,404 of its Air sedans during the quarter, about 600 fewer than analysts expected. It was also down from the 1,406 delivered in Q1. Lucid said it has begun to ship vehicles to Saudi Arabia after the country’s Ministry of Finance agreed last year to buy at least 50,000 and up to 100,000 EVs from the company over the next decade. The CFO said the company ended Q2 with $6.25 billion in available liquidity, enough to last into 2023. Lucid reaffirmed its previous production guidance, expecting to produce “over 10,000” vehicles this year. UPS Cuts Forecast United Parcel Service (UPS) shares are falling 3.9% in premarket after reporting mixed Q2 results and cutting its outlook. Here’s how the shipping giant’s results compared to analysts’ estimates: Adjusted EPS: $2.54 vs $2.50 expected Revenue: $22.1 billion vs $23.1 billion expected Revenue dropped 11% year over year as average daily package volume in the U.S. tumbled 9.9%. UPS forecast full-year revenue of $93 billion and operating margins around 11.8%, that was down from previous guidance for $97 billion and 12.8% respectively. Part of the lower guidance is due to the new labor contract agreed to between UPS and the Teamsters Union. The CEO said, “We will stay on strategy to capture growth in the most attractive parts of the market.” In Case You Missed It Tesla (TSLA) shares fell 1% on Monday after the electric automaker’s CFO stepped down. A regulatory filing showed he will step down effective Friday and be replaced by the current chief accounting officer. The departing CFO will remain with Tesla through the end of the year to help with the transition.
Continue Reading -->Coffee With Greta: New Week Bounce
Register now for this week’s free Q&A event on LinkedIn with T3 professional trader Brandt Hersh! DJIA Futures: +111 (+0.3%) SPX Futures: +19 (+0.4%) NASDAQ Futures: +85 (+0.6%) Good morning friends! Futures are higher as the market looks to rebound from a losing week. Let’s get right to it! Tyson Earnings Miss Tyson Foods (TSN) shares are dropping 7.9% ahead of the open after missing fiscal Q3 expectations on the top and bottom line. Here’s how the meat producer’s results compared to analysts’ estimates: Adjusted EPS: $0.15 vs $0.26 expected Revenue: $13.14 billion vs $13.63 billion expected Tyson’s CEO said, “While current market dynamics remain challenging, Tyson Foods is fully committed to our vision of delivering sustainable, top line growth and margin improvement.” Beef sales fell 5.3% during the quarter as prices rose 5.2%, pork sales fell 1.8% and prices tumbled 16.4%, chicken sales rose 2.8% and prices fell 5.5%, and prepared food sales fell 0.7% while prices fell 1.9%. Tyson forecast full-year sales between $53 billion to $54 billion, in line with analysts’ estimates for $53.7 billion. Inflation Week This is a key week for traders as the market awaits the latest inflation data. The Bureau of Labor Statistics releases the July consumer price index Thursday morning. Economists expect the annual CPI to increase to 3.3% from 3% in June with the core CPI falling to 4.7% from 4.8% in June. This report is part of the data the Fed is monitoring as it decides what to do at the September meeting. The PPI will be released Friday morning. Upcoming Earnings Second-quarter earnings season continues this week, here are some of the biggest reports set to be released: Monday PM: Lucid Group (LCID) Tuesday AM: UPS (UPS), Under Armour (UA) Tuesday PM: AMC Entertainment (AMC), Lyft (LYFT) Wednesday AM: Roblox (RBLX) Wednesday PM: Walt Disney (DIS) Thursday AM: Alibaba (BABA)
Continue Reading -->Coffee With Greta: Labor Market Slows
Register now for next week’s free Q&A event on LinkedIn with T3 professional trader Brandt Hersh! DJIA Futures: +27 (+0.1%) SPX Futures: +8 (+0.2%) NASDAQ Futures: +36 (+0.2%) Good morning friends! Futures are higher as traders assess the July jobs report and the latest big tech earnings. Let’s get right to it! Jobs Report Miss The U.S. economy added less jobs than expected in July, indicating slowing growth in the labor market. The Labor Department reported nonfarm payrolls grew by 187,000 last month vs 200,000 expected. It was a slight gain from the downwardly revised 185,000 in June. But the unemployment rate fell unexpectedly to 3.5% vs expectations for it to be unchanged at 3.6%. Average hourly earnings rose 0.4% monthly and 4.4% year over year, higher than 0.3% monthly and 4.2% annually expected. Apple Beats Apple (AAPL) shares are down 3% ahead of the open after beating fiscal Q3 expectations on the top and bottom line as hardware sales continued to slow. Here’s how the iPhone maker’s results compared to analysts’ estimates: EPS: $1.26 vs $1.19 expected Revenue: $81.80 billion vs $81.69 billion expected iPhone revenue: $39.67 billion vs $39.91 billion expected Mac revenue: $6.84 billion vs $6.62 billion expected iPad revenue: $5.79 billion vs $6.41 billion expected Other Products revenue: $8.28 billion vs $8.39 billion expected Services revenue: $21.21 billion vs $20.76 billion expected Gross margin: 44.5% vs 44.2% expected Total revenue was down 1% year over year, driven by slowing sales for the iPhone, Mac, and iPad. Apple’s sales in China jumped 8% year over year with CEO Tim Cook saying he’s seeing “definite acceleration” in the market. The company reported $166.5 billion in cash on hand, up slightly from Q2. Apple did not provide guidance. Amazon Crushes Expectations Amazon (AMZN) shares are jumping 9% in premarket trade after crushing Q2 expectations and issuing strong guidance. Here’s how the tech giant’s results compared to analysts’ estimates: EPS: $0.65 vs $0.35 expected Revenue: $134.4 billion vs $131.5 billion expected Amazon Web Services revenue: $22.1 billion vs $21.8 billion expected Advertising revenue: $10.7 billion vs $10.4 billion expected Overall revenue jumped 11% year over year, marking a return to double-digit growth. Ad revenue soared 22% from a year ago. Amazon forecast Q3 revenue between $138 billion and $143 billion, implying growth of 9% to 13%. That topped analysts’ estimates for $138.25 billion in revenue. Airbnb Bookings Slow Airbnb (ABNB) shares are falling 2.6% ahead of the open after reporting less bookings than expected in the second quarter. Here’s how the vacation rental site’s results compared to analysts’ estimates: EPS: $0.98 vs $0.78 expected Revenue: $2.48 billion vs $2.42 billion expected Revenue rose 18% year over year while gross bookings rose 12% to $19.1 billion vs $18.99 billion expected. But Airbnb reported 115.1 million nights and experiences booked during the quarter, less than 117.6 million expected. That marked 11% growth from a year ago, a slowdown from the 19% growth in Q1. Airbnb expected Q3 revenue between $3.3 billion and $3.4 billion, implying 14% to 18% growth. Nikola’s Losses Narrow, CEO Steps Down Nikola (NKLA) shares are falling 11.6% in premarket trade after missing Q2 sales expectations and announcing its CEO is stepping down. Here’s how the electric truckmaker’s results compared to analysts’ estimates: Loss per share: $0.20 vs $0.22 expected Revenue: $15.36 million vs $15.4 million expected The company said its CEO will step down effective immediately due to a “family health matter”. The current board chair will take over as CEO. The earnings report comes after Nikola won approval from shareholders on Thursday to issue new stock to raise more funds. Nikola delivered 45 battery-electric semitrucks to dealers during Q2 and dealers sold 66 of the trucks to customers, the company’s best quarterly retail result to date. The company said it began production of its longer-range fuel-cell powered semitruck on July 31 with deliveries expected to begin in September. The company currently has 202 orders for those longer-range trucks from 18 fleet customers.
Continue Reading -->Coffee With Greta: Waiting For AAPL, AMZN
Register now for next week’s free Q&A event on LinkedIn with T3 professional trader Brandt Hersh! DJIA Futures: -65 (-0.2%) SPX Futures: -14 (-0.3%) NASDAQ Futures: -84 (-0.5%) Good morning friends! Futures are slipping as Wall Street looks set to extend Wednesday’s losses and traders wait for big tech earnings after the close. Let’s get right to it! Weekly Jobless Claims Inch Higher Weekly jobless claims rose slightly last week in a continued sign of strength for the labor market. The Labor Department reported 227,000 Americans filed initial claims for unemployment benefits last week. That was up by 6,000 from the previous week and in line with expectations. Continuing claims rose by 21,000 to 1.7 million in the week ending July 22. Qualcomm Misses On Sales, Forecast Qualcomm (QCOM) shares are tumbling 9.2% ahead of the open after reporting mixed Q3 results and issuing weak guidance. Here’s how the chipmaker’s results compared to analysts’ estimates: Adjusted EPS: $1.87 vs $1.81 expected Revenue: $8.44 billion vs $8.5 billion expected Net income dropped 52% year over year. Qualcomm forecast Q4 EPS between $1.80 and $2 on revenue between $8.1 billion and $8.9 billion. Analysts were anticipating guidance of $1.91 in EPS on $8.7 billion in revenue. PayPal Margins Fall Short PayPal (PYPL) shares are dropping 8.8% in premarket trade after missing Q2 profit expectations and falling short on a key margin metric. Here’s how the digital payments company’s results compared to analysts’ estimates: Adjusted EPS: $1.13 vs $1.15 expected Revenue: $7.29 billion vs $7.27 billion expected PayPal reported an adjusted operating margin of 21.4% in the quarter, below its previous guidance for 22%. The company attributed that miss to lower than anticipated revenue in its credit portfolio. The CFO said PayPal expects continued pressure on transaction-margin performance in Q3 before conditions improve in Q4. Shopify Drops Shopify (SHOP) shares are down 3.5% ahead of the open despite beating Q2 expectations on the top and bottom line. Here’s how the e-commerce platform’s results compared to analysts’ estimates: Adjusted EPS: $0.14 vs $0.06 expected Revenue: $1.7 billion vs $1.63 billion expected Revenue was up 31% year over year. Gross merchandise volume also jumped 17% to $55 billion vs $53.5 billion expected. Shopify forecast Q3 revenue growth in the low 20s vs analysts’ estimates for 18% growth.
Continue Reading -->Coffee With Greta: U.S. Downgraded
Register now for today’s free Q&A event on LinkedIn with T3’s Senior Trader Derrick Oldensmith! DJIA Futures: -150 (-0.4%) SPX Futures: -27 (-0.6%) NASDAQ Futures: -127 (-0.8%) Good morning friends! Futures are falling after the U.S. credit rating was downgraded overnight. Let’s get right to it! Fitch Downgrades U.S. Global credit rating agency Fitch Ratings downgraded the United States to AA+ from AAA on Tuesday. Fitch cited “expected fiscal deterioration over the next three years” as the reason for that move after putting the U.S. on negative watch in May amid the debt ceiling fight. The agency said, “The repeated debt-limit political standoffs and last-minute resolutions have eroded confidence in fiscal management.” This is only the second time the U.S. has been downgraded by a credit rating agency. S&P cut the nation’s rating from AAA to AA+ in 2011 amid a similar debt ceiling fight. Private Job Growth Booms The U.S. private sector added far more jobs than expected in July. ADP reported private employers added 324,000 jobs last month vs 175,000 expected. But it was still a slowdown from 455,000 in June. The services sector as a whole added 303,000 jobs, led by leisure and hospitality which gained 201,000. The goods producing sector added just 21,000 as natural resources and mining grew by 48,000 but manufacturing lost 36,000. The Labor Department releases the official July jobs report on Friday which is expected to show the economy added just 200,000 jobs with the unemployment rate unchanged at 3.6%. AMD Earnings Beat Advanced Micro Devices (AMD) shares up 2.5% ahead of the open after beating Q2 expectations on the top and bottom line. Here’s how the chipmaker’s results compared to analysts’ estimates: Adjusted EPS: $0.58 vs $0.57 expected Revenue: $5.36 billion vs $5.31 billion expected Despite the beat, revenue was down 18% year over year. AMD is seeing falling demand in its PC business but says it expects AI to boost its sales in the future. The company is one of few that makes the high-end graphics processing units needed for AI. AMD forecast Q3 revenue of $5.7 billion vs $5.81 billion expected by analysts. Starbucks Sales Disappoint Starbucks (SBUX) shares are falling 0.9% in premarket trade after missing Q2 sales expectations. Here’s how the coffee chain’s results compared to analysts’ estimates: Adjusted EPS: $1 vs $0.95 expected Revenue: $9.17 billion vs $9.29 billion expected Total same-store sales grew 10% year over year vs 11% expected. North American same-store sales also missed estimates, up 7% vs 8.4% expected. Pinterest Expenses Soar Pinterest (PINS) shares are dropping 4% ahead of the open despite beating Q2 expectations as expenses jumped sharply. Here’s how the social media company’s results compared to analysts’ estimates: Adjusted EPS: $0.21 vs $0.12 expected Revenue: $708 million vs $696 million expected Sales were up 6% year over year but total costs and expenses jumped 11%. Global monthly active users rose 8% year over year to 465 million during the quarter. Pinterest said it expects Q3 revenue growth “in the high single digits range year over year”. E.L.F. Surges e.l.f. Beauty (ELF) shares are surging 15.9% in premarket trade after beating fiscal Q1 expectations and hiking its outlook. Here’s how the beauty company’s results compared to analysts’ estimates: Adjusted EPS: $1.10 vs $0.57 expected Revenue: $216.3 million vs $185 million expected For fiscal 2024, Elf now expects between $792 million and $802 million in revenue vs $705 million to $720 million previously. The company forecast full-year adjusted EPS between $2.19 and $2.22 vs $1.73 to $1.76 previously. CVS Slips CVS Health (CVS) shares are down 2.2% ahead of the open despite beating Q2 expectations. Here’s how the pharmacy giant’s results compared to analysts’ estimates: Adjusted EPS: $2.21 vs $2.11 expected Revenue: $88.9 billion vs $86.5 billion expected Net income dropped 37% year over year while revenue rose 10%. CVS maintained its full-year outlook as it continues cost cutting efforts. In Case You Missed It Ford Motor (F) shares rose 1.6% on Tuesday after the automaker reopened its F-150 Lightning factory. The facility had been closed for six weeks for upgrades. Ford also said recent price cuts on the Lightning had significantly increased demand. The EV unit’s chief customer officer said the company has “about 45 days’ worth” of orders for the electric truck. Job openings fell unexpectedly in June. The Labor Department’s Job Openings and Labor Turnover Survey (JOLTS) released on Tuesday showed there were 9.58 million available jobs for the month. That was a decrease from the downwardly revised 9.62 million in May and lower than 9.7 million expected. It was the lowest level of job openings since April 2021. Layoffs also fell to 1.53 million in June from 1.55 million in May.
Continue Reading -->Coffee With Greta: August Kickoff
Register now for tomorrow’s free Q&A on LinkedIn with T3’s Senior Trader Derrick Oldensmith! DJIA Futures: -94 (-0.3%) SPX Futures: -19 (-0.4%) NASDAQ Futures: -86 (-0.5%) Good morning friends! Futures are slipping as a new month of trade begins and a busy earnings week continues. Let’s get right to it! Pfizer Slips On Weak Revenue Pfizer (PFE) shares are down 0.1% ahead of the open after beating Q2 profit expectations but missing on revenue. Here’s how the pharmaceutical giant’s results compared to analysts’ estimates: Adjusted EPS: $0.67 vs $0.57 expected Revenue: $12.73 billion vs $13.27 billion expected Revenue dropped 54% year over year as Covid vaccine sales slowed. The vaccine brought in $1.49 billion in sales during the quarter, down 83% from a year ago. The antiviral pill Paxlovid posted $143 million in sales, down 98% from Q2 2022. Pfizer lowered its full-year sales forecast following the results. The company now expects revenue between $67 billion and $70 billion vs $67 billion to $71 billion previously. Pfizer maintained its full-year adjusted earnings guidance. Uber Jumps On Strong Guidance Uber Technologies (UBER) shares are up 1.1% in premarket trade after reporting mixed Q2 results and issuing strong guidance. Here’s how the ride-hailing giant’s results compared to analysts’ estimates: EPS: $0.18 vs $0.01 loss expected Revenue: $9.23 billion vs $9.33 billion expected Gross bookings jumped 16% year over year to $33.6 billion. The CEO said it was Uber’s first quarter of free cash flow over $1 billion and its first GAAP operating profit. He said the company plans to remain profitable in every quarter moving forward. Uber forecast gross booking between $34 billion and $35 billion in the third quarter with adjusted EBITDA between $975 million and $1.025 billion. Both of those were ahead of analysts’ estimates. JetBlue Drops After Guidance Cut JetBlue Airways (JBLU) shares are down 5.7% ahead of the open after slashing its full-year outlook. Here’s how the airline’s Q2 results compared to analysts’ estimates: Adjusted EPS: $0.45 vs $0.44 expected Revenue: $2.61 billion, as expected But JetBlue now expected full-year adjusted EPS to range between $0.05 and $0.40, down from an earlier estimate of $1. The airline expects an adjusted loss of as much as $0.20 per share in Q3 with revenue down 4% to 8% year over year. That lower outlook is due to passengers’ shifting demand toward international travel as well as the end of JetBlue’s partnership with American Airlines (AAL) in the Northeast. Caterpillar Crushes Q2 Estimates Caterpillar (CAT) shares are up 1.3% in premarket trade after crushing Q2 expectations. Here’s how the company’s results compared to analysts’ estimates: Adjusted EPS: $5.55 vs $4.57 expected Revenue: $17.3 billion vs $16.5 billion expected Caterpillar’s adjusted operating profit margin improved to 21.3% in the quarter, up from 13.8% a year ago. The company said it expects sales and profit margins in Q3 to be higher year over year but down from Q2. In Case You Missed It SoFi Technologies (SOFI) shares surged 19.9% on Monday after beating Q2 expectations on the top and bottom line. The company also hiked its full-year outlook. SOFI closed at a fresh 52-week high. A new Fed survey found lending conditions in the U.S. are tight and likely to get tighter. The Central Bank released its second-quarter Senior Loan Officer Opinion Survey Monday. That report said banks have tightened lending standards for credit cards, consumer loans, and auto loans. Respondents said they plan to further tighten standards in the second half of this year.
Continue Reading -->Coffee With Greta: Another Big Week
Register now for this week’s free Q&A on LinkedIn with ProDesk’s Derrick Oldensmith! DJIA Futures: +67 (+0.2%) SPX Futures: +12 (+0.3%) NASDAQ Futures: +44 (+0.3%) Good morning friends! Futures are higher as traders gear up for another big week of data and earnings. Let’s get right to it! Jobs Week This will be another important week of economic data for traders and the Fed. The Labor Department releases the June job openings and labor turnover survey (JOLTS) on Tuesday. ADP reports private employment numbers for July on Wednesday. And the Labor Department releases the official July jobs report on Friday. The Fed has previously said it is looking for signs of slowing job growth as it works to fight inflation. More Big Earnings It will also be another week of important earnings reports. Here are some of the highlights: Tuesday AM: Pfizer (PFE), Caterpillar (CAT), Uber (UBER) Tuesday PM: AMD (AMD), Starbucks (SBUX), Pinterest (PINS) Wednesday AM: CVS (CVS) Wednesday PM: Qualcomm (QCOM), Shopify (SHOP), PayPal (PYPL), DoorDash (DASH), Unity Software (U) Thursday AM: Moderna (MRNA), Warner Bros Discovery (WBD), Kellogg (K) Thursday PM: Apple (AAPL), Amazon (AMZN), Airbnb (ABNB), Block (SQ), Coinbase (COIN) Yields Flat Treasury yields are up slightly this morning as traders attempt to gauge the Fed’s plans for rates. The 2-year yield is up less than 0.5 points at 4.88% while the 10-year yield is up 1 points at 3.97%. The core PCE price index, which is the Fed’s preferred inflation gauge, cooled more than expected in June. CME Group’s FedWatch tool currently shows 79.5% of traders expecting the Fed to keep rates unchanged at the September meeting. 20.5% are anticipating another 25 bps rate hike. FedWatch shows the majority of traders expecting the Central Bank to keep rates unchanged through the end of the year.
Continue Reading -->Coffee With Greta: Cooling Inflation
Register now for next week’s free Q&A on LinkedIn with ProDesk’s Derrick Oldensmith! DJIA Futures: +148 (+0.4%) SPX Futures: +28 (+0.6%) NASDAQ Futures: +156 (+1.0%) Good morning friends! Futures are rising after the release of cool inflation data. Let’s get right to it! PCE Inflation Drops The Fed’s preferred inflation gauge cooled further in June. The Bureau of Economic Analysis’ personal consumption expenditures (PCE) price index rose 0.2% monthly and 3% annually. That was in line with estimates on a monthly basis and better than 3.1% annually expected. It was the slowest rate of headline inflation since April 2021. But the core PCE price index rose 0.2% monthly and 4.1% year over year. That was better than estimates for a 4.2% annual increase and the lowest level since September 2021. Consumer spending also rose 0.5% last month, up from 0.2% in May. Ford Beats, Hikes Guidance Ford Motor (F) shares are slipping 1.8% ahead of the open despite beating Q2 expectations and hiking its full-year guidance. Here’s how the automaker’s results compared to analysts’ estimates: Adjusted EPS: $0.72 vs $0.55 expected Automotive revenue: $42.43 billion vs $40.38 billion expected Ford said total revenue came in at $45 billion, up 12% year over year. The Model e electric vehicle unit posted a $1.08 billion loss during the quarter. Ford now expects full-year adjusted earnings to range between $11 billion and $12 billion, up from $9 billion to $11 billion previously. The automaker also expected adjusted free cash flow of $6.5 billion to $7 billion vs $6 billion previously. But the company also said it now expects to lose $4.5 billion on the EV business this year, up from $3 billion a year earlier. Intel Returns To Profitability Intel (INTC) shares are up 6.2% in premarket trade after beating Q2 profit expectations. Here’s how the chipmaker’s results compared to analysts’ estimates: Adjusted EPS: $0.13 vs $0.03 loss expected Revenue: $12.9 billion vs $12.13 billion expected The CFO said the stronger than expected performance was partly due to the progress it’s made toward cutting $3 billion in costs this year. That’s part of the company’s previously announced plan to save $10 billion per year by 2025. Intel raised its outlook for the third quarter. The company now expects Q3 adjusted EPS of $0.20 on $13.4 billion in revenue vs analysts’ estimates for $0.16 EPS on $13.23 billion in sales. Roku Rallies Roku (ROKU) shares are rallying 9.1% ahead of the open after reporting a smaller than expected Q2 loss. Here’s how the streaming giant’s results compared to analysts’ estimates: Loss per share: $0.76 vs $1.26 expected Revenue: $847 million vs $775 million expected Roku’s Q3 forecast was also stronger than expected. The company expects $815 million in total revenue with a $50 million adjusted Ebitda loss. That was better than analysts’ estimates for $809 million in revenue and a $57 million loss. Procter & Gamble Pops Procter & Gamble (PG) shares are up 1.6% in premarket trade after beating fiscal Q4 expectations on the top and bottom line. Here’s how the consumer goods giant’s results compared to analysts’ estimates: EPS: $1.37 vs $1.32 expected Revenue: $20.55 billion vs $19.98 billion expected Net sales rose 5% year over year while organic revenue jumped 8%. The better-than-expected performance was driven by price hikes across its products even as sales volume fell 1% from a year ago. But P&G’s outlook came in short. The company expects fiscal 2024 revenue growth of 3% to 4% vs 4.5% expected. P&G also projected EPS growth of 6% to 9%, on the lower end of analysts’ 8.8% projection. In Case You Missed It Anheuser-Busch (BUD) shares fell 0.9% on Thursday after the company announced corporate layoffs. The Bud Light maker plans to layoff about 350 corporate employees in the U.S. The CEO said, “These corporate structure changes will enable our teams to focus on what we do best — brewing great beer for everyone and earning our place in the moments that matter.” The company said the layoffs will not affect brewery and warehouse staff or drivers and field salespeople.
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Register now for next week’s free Q&A on LinkedIn with ProDesk’s Derrick Oldensmith! DJIA Futures: +133 (+0.4%) SPX Futures: +37 (+0.8%) NASDAQ Futures: +219 (+1.4%) Good morning friends! Futures are gaining as traders digest hot new economic data and the latest batch of big earnings. Let’s get right to it! Q2 GDP Hotter Than Expected The U.S. economy grew more than expected in the second quarter. The Commerce Department’s first estimate shows GDP increased at a 2.4% annualized rate vs 2% expected. That was up from the 2% growth in Q1. Inflation pressures were also better-than-expected during the quarter. The personal consumption expenditures price index increased 2.6% vs 3.2% expected, down from 4.1% in Q1. Consumer spending rose 1.6% in Q2, accounting for 68% of all economic activity during the quarter. Gross private domestic investment increased 5.7% after dropping 11.9% in the first quarter. Government spending increased 2.6%. Weekly Jobless Claims Fall Weekly jobless claims fell unexpectedly again last week as the labor market maintains strength. The Labor Department reported 221,000 Americans filed initial claims for unemployment benefits. That was down by 7,000 from the previous week and lower than 235,000 expected. Continuing claims also dropped by 59,000 to 1.69 million in the week ending July 15. Meta Rallies Meta Platforms (META) shares are rallying 9.9% ahead of the open after beating Q2 expectations and issuing strong guidance. Here’s how the social media giant’s results compared to analysts’ estimates: EPS: $2.98 vs $2.91 expected Revenue: $32 billion vs $31.12 billion expected Daily Active Users: 2.06 billion vs 2.04 billion expected Monthly Active Users: 3.03 billion vs 3 billion expected Average revenue per user $10.63 vs $10.22 expected Revenue was up 11% year over year, the first quarter of double-digit growth since the end of 2021. Meta forecast Q3 revenue between $32 billion and $34.5 billion vs $31.3 billion expected. That figure suggests 15% growth annually. Chipotle Drops Chipotle Mexican Grill (CMG) shares are falling 7.8% in premarket trade after missing Q2 revenue expectations. Here’s how the restaurant chain’s results compared to analysts’ estimates: Adjusted EPS: $12.65 vs $12.31 expected Revenue: $2.51 billion vs $2.53 billion expected Revenue was up 13.6% year over year while same-store sales grew 7.4% vs 7.5% expected. Chipotle saw lower costs for avocados during the quarter but higher prices for tortillas, beef, and dairy still put pressure on profit. Despite previously saying they were done hiking prices, the CEO seemed more open to another round of prices increases in the future. He said, “As we get closer to that fourth quarter, we’ll make a decision exactly on what we want to do on the pricing front.” Chipotle reiterated its full-year forecast. McDonald’s Beats McDonald’s (MCD) shares are up 1.3% ahead of the open after beating Q2 expectations on the top and bottom line. Here’s how the fast food chain’s results compared to analysts’ estimates: Adjusted EPS: $3.17 vs $2.79 expected Revenue: $6.5 billion vs $6.27 billion expected Global same-store sales jumped 11.7% vs 9.2% expected. Same-store sales in the U.S. rose 10.3%. Southwest Slips Southwest Airlines (LUV) shares are falling 5.5% in premarket trade after missing Q2 profit expectations but beating on revenue. Here’s how the airline’s results compared to analysts’ estimates: Adjusted EPS: $1.09 vs $1.10 expected Revenue: $7.04 billion vs $6.98 billion expected Profit tumbled 10% year over year while total revenue rose 4.6%. But Southwest’s unit revenue dropped 8.3% from a year ago and the company said it expects unit revenue to fall as much as 7% in Q3 despite capacity being 12% higher. Southwest’s operating expenses also jumped more than 12%. Excluding fuel, those expenses were up 7.5%. In Case You Missed It The Federal Reserve raised the federal funds rate on Wednesday by 25 basis points as expected. That puts the benchmark rate in a range of 5.25% to 5.5% – the highest since March 2001. The Fed reiterated it will remain “data dependent” in future meetings and Chairman Jerome Powell said they could either raise rates again or leave them unchanged in September. New home sales dropped unexpectedly in June. The Census Bureau reported new home sales fell 2.5% last month to a seasonally adjusted annual rate of 697,000 units vs 725,000 expected. New home sales in May were also revised lower to 715,000 units from 763,000 previously.
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