Coffee With Greta: Bull Market
Register now for next week’s free Q&A with Scott Redler on LinkedIn! DJIA Futures: -67 (-0.2%) SPX Futures: +3 (+0.1%) NASDAQ Futures: +45 (+0.3%) Good morning friends! Futures are mixed after the S&P 500 notched its highest close of the year on Thursday. Let’s get right to it! S&P 500 Enters Bull Market The S&P 500 officially closed in bull market territory on Thursday. The index ended the session 0.6% higher at 4,293.93 – the highest close so far of 2023. But it was also up 20% from the most recent low on October 12, 2022. That’s the official threshold that marks a new bull market. The index is on track for its fourth straight positive week for the first time since August. GM To Use Tesla EV Chargers General Motors (GM) shares are up 4% ahead of the open after the automaker reached a deal with Tesla (TSLA) to use the EV maker’s North American charging network. TSLA shares are also up 6.2% in premarket trade. GM vehicles will be able to access 12,000 of Tesla’s superchargers using an adapter starting next year. Starting in 2025, automaker will also begin installing the charging port used by Tesla in its cars, NACS (North American Charging Standard), instead of the current industry-standard CCS. GM CEO Mary Barra told CNBC the deal should save the automaker up to $400 million of a previously announced $750 million investment in EV charging. A similar deal was announced between Ford (F) and Tesla last month. DocuSign Earnings Beat Expectations DocuSign (DOCU) shares are up 6.9% ahead of the open after beating fiscal Q1 expectations on the top and bottom line. Here’s how the e-signature provider’s results compared to analysts’ estimates: Adjusted EPS: $0.72 vs $0.56 expected Revenue: $661 million vs $642 million expected Both total revenue and subscription revenue jumped 12% year over year. Revenue in the professional services and other category was up 14%. DocuSign reported 1.4 million paying users and more than 1 billion total users as of April 30. The company expects fiscal Q2 revenue between $675 million and $679 million vs $667 million expected. For the full year, DocuSign forecast revenue between $2.71 billion and $2.73 billion vs $2.7 billion expected. In Case You Missed It Carvana (CVNA) shares surged 56% on Thursday after the used-car retailer hiked its fiscal Q2 guidance. The company now expects to report adjusted EBITDA of $50 million for the current quarter, beating analysts’ estimates. Carvana is expected to report earnings on August 3rd. The CEO said, “Our updated Q2 2023 outlook demonstrates that our progress continues to positively impact the business even faster than expected.”
Continue Reading -->Coffee With Greta: Meme King Takes Over GME
Register now for next week’s free Q&A with Scott Redler on LinkedIn! DJIA Futures: -30 (-0.1%) SPX Futures: +2 (+0.1%) NASDAQ Futures: +28 (+0.2%) Good morning friends! Futures are mostly flat as the recent rally takes a pause. Let’s get right to it! GameStop Plunges After Executive Shakeup GameStop (GME) shares are plunging 21.5% ahead of the open after the video game retailer reported Q1 earnings and fired its CEO on Wednesday. The company reported a net loss of $0.17 per share on $1.24 billion in revenue and canceled its earnings conference call. GameStop fired CEO Matthew Furlong and appointed Ryan Cohen as executive chairman effective immediately. The quarterly securities filing said, “We believe the combination of these efforts to stabilize and optimize our core business and achieve sustained profitability while also focusing on capital allocation under Mr. Cohen’s leadership will further unlock long-term value creation for our stockholders.” Furlong also resigned from the company’s board upon his firing. GameStop said Cohen will be in charge of capital allocation, evaluating potential investments and acquisitions and overseeing the managers of GameStop’s holdings. Weekly Jobless Claims Jump Weekly jobless claims jumped more than expected last week. The Labor Department reported 261,000 Americans filed initial claims for unemployment benefits. That was up by 28,000 from the previous week and the highest level since October 2021. Economists were expecting claims to rise to 236,000. Eurozone Enters Recession Revised data shows the Eurozone entered a recession in the first quarter of the year. The bloc reported GDP of -0.1% in Q1, down from the first estimate of +0.1%. That marked two consecutive quarters of contraction after Europe also saw a 0.1% contraction in Q4 2022. Lucid Looks To Enter Chinese Market Lucid (LCID) shares are up 3.4% in premarket trade following reports the electric automaker is looking to enter the Chinese market. The company’s head of China operations, Zhu Jiang, confirmed those reports with Reuters. He declined to comment on other reports that Lucid is considering plans for local production in China. Zhu said the funding from its recently announced stock offering would help “bring the advanced EV technology and product experience to the industry and users globally at a faster pace.”
Continue Reading -->Coffee With Greta: 10-Month High
Register now for my free Q&A event with David Prince on LinkedIn today! DJIA Futures: +11 (+0.03%) SPX Futures: +4 (+0.1%) NASDAQ Futures: +8 (+0.1%) Good morning friends! Futures are flat but higher as traders look to extend the recent rally. Let’s get right to it! Market Extends Gains The major indexes are on track to open slightly higher after the S&P 500 closed at 10-month high on Tuesday. The index closed 0.24% higher at 4,283.85, the highest level since August 2022. The Nasdaq also gained 0.36%, notching out its highest close in 2023. Some analysts say the recent market action is a bullish signal. “The fact that it refuses to fall to me is extremely bullish,” said Adam Sarhan, CEO of 50 Park Investments. “Normally, after a big run up, you see a market pullback, and when the market doesn’t pull back and goes sideways, that to me is very bullish.” Trade Deficit Hits 6-Month High The U.S. trade deficit rose less than expected in April. The Commerce Department reported that gap jumped 23% to $74.6 billion. That was lower than expectations for $75.2 billion but was the highest level in six months as imports rebounded. Imports jumped 1.5% to $323.6 billion while exports fell 3.6% to $249 billion. Cathie Wood Buys The COIN Dip Coinbase (COIN) shares are up 3.2% ahead of the open after tumbling 12.1% on Tuesday after the SEC sued the crypto exchange. The jump comes after investor Cathie Wood increased her fund’s stake in the stock amid the drop. In an email, ARK Invest funds said it added more than 400,000 shares of COIN spread across the ARK Innovation ETF (ARKK), Next Generation Internet ETF (ARKW), and Fintech Innovation ETF (ARKF). Wood’s funds are the second-largest holder of Coinbase with an 11.44 million share stake. Stitch Fix Tops Fiscal Q3 Expectations Stitch Fix (SFIX) shares are up 9.5% in premarket trade after beating fiscal Q3 expectations on the top and bottom line. Here’s how the styling company’s results compared to analysts’ estimates: Loss per share: $0.19 vs $0.31 expected Revenue: $394.9 million vs $389 million expected The company announced further steps to reduce costs including closing its Dallas distribution center next year and letting the lease on another distribution center expire this year. Stitch Fix also said it would “explore exiting” the U.K. to focus on its styling business in the U.S. The company said it expects fiscal Q4 revenue between $365 million and $375 million, below analysts estimate of $379 million In Case You Missed It Boeing (BA) shares fell 0.7% Tuesday after the planemaker warned about a new defect on its 787 Dreamliner planes. The company said the issue is related to a “nonconforming condition” on a horizontal stabilizer fitting. Boeing said this will slow deliveries of the planes in the near-term but it will not impact its full-year delivery outlook.
Continue Reading -->Coffee With Greta: COIN In Trouble
Register now for my free Q&A event with David Prince on LinkedIn tomorrow! DJIA Futures: -25 (-0.1%) SPX Futures: -3 (-0.1%) NASDAQ Futures: -18 (-0.1%) Good morning friends! Futures are slipping as the recent market rally takes a breather. Let’s get right to it! SEC Sues Coinbase Coinbase (COIN) shares are tumbling 15.6% ahead of the open after the SEC sued the crypto exchange in New York federal court this morning. The regulator alleges that Coinbase is acting as an unregistered broker and exchange. The SEC demanded the company be “permanently restrained and enjoined” from continuing to operate in that manner. The case comes after the SEC sued rival crypto exchange Binance and its CEO on Monday. The suit says Coinbase “has for years defied the regulatory structures and evaded the disclosure requirements” of U.S. securities law. SEC chair Gary Gensler said, “We allege that Coinbase, despite being subject to the securities laws, commingled and unlawfully offered exchange, broker-dealer, and clearinghouse functions.” Apple Dips After Big VR Reveal Apple (AAPL) shares are down 0.4% in premarket trade after announcing a new virtual reality headset on Monday. The stock hit a record high of $184.95 earlier in Monday’s session, before the highly-anticipated announcement at the Worldwide Developers Conference. Apple’s unveiled its first virtual reality headset, the Apple Vision Pro, which costs $3500 and will be available starting in early 2024. The company also announced iOS 17, watchOS 10, a new Macbook Air, a new Mac Pro with an its first in-house chip, and more. Oil Prices Fall On Economic Fears Oil prices are falling this morning as fresh fears about the economy overshadow the Saudi plan to cut output. West Texas Intermediate crude futures are down 2.1% at $70.62 bbl while Brent crude futures are down 1.9% at $75.22 bbl. Analysts said Saudi Arabia’s plan to cut its output by 1 million barrels per day is unlikely to cause a “sustainable price increase” amid weaker demand, stronger non-OPEC supply, and potential recessions across the globe. The U.S. Energy Information Administration is set to release its short-term energy outlook this afternoon. In Case You Missed It The services side of the U.S. economy slowed more than expected last month. The ISM services PMI fell to 50.3% in May from 51.9% in April. That marked a five-month low and was weaker than expectations for 51.8%. Business owners say ‘Everything seems to have leveled off. Not getting any worse, not getting any better.’
Continue Reading -->Why $183 Matters for Apple
SPY held the 8 day last week and Thursday. I bought some $421 calls for another breakout. SPY hit $428.74 and I took off half for ~75%. I’ll trim the rest because they expire today. If we pull back a bit, I may add higher strikes. $431.73 is the high from last August. QQQ: tech led the rally since March with many nice setups along the way. It might underperform in June. $352ish is upper support. We can’t get too bearish if that holds. The AAPL event at 1:00 will be interesting. If that doesn’t get sold, QQQ shorts will get punished. I sold premium higher to generate some cash flow. Now let’s look at individual names: AAPL: there are lots of upgrades and articles ahead of the 1:00 p.m. ET WWDC event with talk about AR and AI. They usually try and sell these events. $183 is a very interesting spot. See how it deals with that today. I bought stock and options as it held the post-earnings gap. I’ll trim stock and hold options in case it clears the all-time high. TSLA has kept rewarding traders since clearing $169.76 where I put my swing long on. It’s given us multiple setups with plenty of options trades. It hit $217.25 Friday. I switched to another call spread and I’m still long. I’ll trim some and hold some. NVDA had a huge move that gave us so many ways to buy and trade it. The stock hit $419.36 with a topping tail to give clues it might need to consolidate for a while. We can be tactical here. Some got short Friday as it went green to red with a low of $390.58. This morning, see if there’s a signal to go red to green, or if it sees $378 active support or the important earnings gap pivot. AMD triggered long after I listed it around $91.60. it’s been special since then and above the 8 day. Last Tuesday, I mentioned to trim or look for a cute short as it was super extended. It hit $130.79. On Friday it made a lower high at $121 and went red. This morning it will be testing the $115.80 gap pivot. I’ll see if there’s an active buy vs. a 5-15-30 minute low. NFLX is tricky at times, but it gave so many set ups that I went over here. Last week it held $385ish and hit a high of $407.52. Use the 8 day as your guide. MSFT is still rewarding swing longs. It’s been riding the 8 day with a high of $337.50. Keep managing the trade. Many are doing well with it. Scott Redler Positions Disclosure as of 2023-06-05 at 9.21.23 AM
Continue Reading -->Coffee With Greta: New Week
DJIA Futures: -3 (-0.01%) SPX Futures: +2 (+0.04%) NASDAQ Futures: -13 (-0.1%) Good morning friends! Futures are flat after the market’s best week since March. Let’s get right to it! IMF Chief Calls For More Rate Hikes The International Monetary Fund’s managing director says lending has not slowed enough to warrant the Fed pausing its rate-hiking cycle. Kristalina Georgieva told CNBC over the weekend, “We don’t yet see a significant slowdown in lending. There is some, but not on the scale that would lead to the Fed stepping back.” She said the strong jobs report on Friday supports the Fed hiking rates again this month. Georgieva added, “The pressure that comes from incomes going up and in unemployment being still very, very low, means that the Fed will have to stay the course and perhaps in our view, they may need to do a little bit more.” She called on the central bank to “pay attention to trends and be agile, adjusting — should the trends change.” Oil Prices Pop Oil prices are rallying this morning after Saudi Arabia pledged more voluntary production cuts. West Texas Intermediate crude futures are up 2.7% to $73.65 bbl while Brent crude futures are up 2.5% to $78 bbl. OPEC+ made no changes to its planned cuts for the rest of the year but Saudi Arabia announced it will cut production by another 1 million barrels per day starting in July. Saudi production will fall to 9 million bpd from around 10 million in May. Apple Rises Ahead of WWDC Apple (AAPL) shares are up 0.9% ahead of the open ahead of the company’s Worldwide Developers Conference. The WWDC kicks off today in Cupertino, California. Apple is widely expected to announce a “Reality Pro” mixed reality headset. The headset is rumored to offer both virtual reality and augmented reality. The company is also expected to reveal new MacBooks and iOS 17 while will include new features for the iPhone, iPad, and Apple Watch Spotify Announces Layoffs Spotify (SPOT) shares are slipping 0.2% in premarket trade after the company announced it will layoff roughly 200 employees. The cuts represent just 2% of Spotify’s workforce and are part of a “pivot” in its podcasting unit. The vice president said those impacted will receive “generous severance packages”. Quieter Week This will be a slower week of economic data for traders. Later this morning the S&P Global services PMI for May will be released at 9:45 a.m. ET followed by April factory orders and the ISM services PMI at 10:00 a.m. Then on Wednesday, the April trade deficit will be released at 8:30 a.m. and the April consumer credit report will be out at 3:00 p.m. Weekly jobless claims will be reported Thursday at 8:30 a.m. with April wholesale inventories at 10:00 a.m.
Continue Reading -->Will GameStop Say AI? What’s on Tap June 5-9, 2023
Welcome to your weekly trading preview! Before we get started, sign up for the Newsbeat Open House with JR Romero! Use the Table of Contents to jump around: Table of Contents This Week’s Trading CalendarWeek in Review: Tech Never Dies?A Big Slowdown…Will GameStop (GME) Say AI?Earnings Season CheckupTraders Are in a “Meh” Mood Despite Market StrengthThe Best ETFs of 2023 – Semis RULE!Factoid of the Week: Retail WinnersSami Lost $65,000 Before He Hit It Big! This Week’s Trading CalendarIf you want to view or download this week’s calendar, check click the image below:Click to enlarge Week in Review: Tech Never Dies?Just when we thought tech couldn’t get any stronger… the QQQ’s jumped another 1.9% this week, aided by surges in names like Tesla (TSLA), Intel (INTC), Paypal (PYPL), and Netflix (NFLX).(data as of 3:15 p.m. Friday) Year-to-date, the QQQ’s are up a ridiculous 33.3%. However, traders are starting to ask whether the other major index ETFs SPY, IWM, and DIA are about to play catch-up. All three outperformed QQQ for the week as small caps, banks, and energy played catch-up. However, judging by the action in individual stocks, shorts had better be careful betting against tech… especially when there’s the potential for the magic two letters to come out. And yes, those magic letters are “AI.” MongoDB (MDB) surged 28% on Friday after a blockbuster earnings report and a bullish outlook driven by the almighty AI. A Big Slowdown…The US economic data calendar slows down this week with:Monday: S&P Global PMI Services PMI, Factory Orders, ISM Non-Manufacturing Employment & PMITuesday: EIA Short-Term Energy Outlook, API Crude Oil StockWednesday: Trade BalanceThursday: Jobless ClaimsFriday: Baker Hughes Rig CountThere’s not a lot to get excited about here so we won’t waste your time with unnecessary commentary. And overseas, we see:Monday: CHF CPI, ES/ITA/FRA/DE PMI, EU Services PMI, JPY Household Spending, GBP Retail SalesTuesday: AUD Rate Decision & GDP, DE Factory Orders, GBP Construction PMI, CAD Building Permits & Ivey PMI, CNY Trade BalanceWednesday: CHF Unemployment, DE Industrial Production, BR CPI, CAD Rate Decision, JPY GDP, AUD Trade BalanceThursday: IN Rate Decision, EU GDP, NZD PMI, CNY CPI & PPIFriday: RUB Rate Decision & CPI, CAD Employment, Will GameStop (GME) Say AI?Last week was action-packed with MongoDB (MDB), Zscaler (ZS), Broadcom (BRCM), Lululemon (LULU), and C3.ai (AI) but this week’s calendar is light.Still, we’ll be watching:Tuesday: The J. M. Smucker Company (SJM), Ciena Corporation (CIEN)Wednesday: Brown-Forman Corporation (BFB), Campbell Soup Company (CPB), GameStop Corp. (GME)Thursday: The Toro Company (TTC), Signet Jewelers Limited (SIG), DocuSign Inc. (DOCU), Vail Resorts Inc. (MTN)Friday: Nio (NIO)The big question we’re going to ask is… will GameStop (GME) say “AI” on its earnings call? Because with the stock up 32% in the past month and short interest sky-high at 18%, management may try to juice the stock with the magic word. Earnings Season CheckupAccording to Factset, 99% of the S&P 500 have reported and:78% of companies beat EPS estimates75% of companies have beaten revenue estimates.Earnings have declined by -2.1% vs. expectations for a -6.7% declineFactset also tells us that 10 of 11 sectors have reported better-than-expected earnings, with utilities being the outlier. Traders Are in a “Meh” Mood Despite Market StrengthInvestors and traders remain bearish despite the market’s strength this year. According to AAII, just 29.1% of investors are bullish. That’s up from last week’s 27.4% reading but under the long-term average of 37.5%. 36.8% of investors are bearish, and AAII said “Bearish sentiment is above its historical average of 31.0% for the 75th time out of the past 80 weeks.” This negativity may be fueling the market’s rise. The Best ETFs of 2023 – Semis RULE!Semiconductors are still rocking hard thanks to blockbuster moves in names like Nvidia (NVDA), AMD (AMD), and Marvell (MRVL).This table shows you just how important sectors have been in 2023. It was hard to predict at the end of 2022, but the more risk you took, the more you got paid this year. Meanwhile, energy is way behind after huge returns in 2021 and 2022. Factoid of the Week: Retail WinnersAmazon (AMZN) and Costco (COST) are the first and third-best retail stocks of 2023:What do they have in common? No shoplifting. We can’t say the same about Lululemon (LULU), though they still squeezed out a huge earnings win. Sami Lost $65,000 Before He Hit It Big!Get to know Sami Abusaad of T3’s Strategic Day Trader VTF®:
Continue Reading -->Coffee With Greta: Hot Jobs Report
DJIA Futures: +216 (+0.7%) SPX Futures: +22 (+0.5%) NASDAQ Futures: +42 (+0.3%) Good morning friends! Futures are higher as traders digest a hotter-than-expected May jobs report and the debt ceiling bill passes Congress. Let’s get right to it! Job Growth Surges In May The U.S. economy added far more jobs than expected in May. The Labor Department reported nonfarm payrolls rose by 339,000 last month while the unemployment rate jumped to 3.7% from 3.4% in April. The gain was sharply higher than economists’ expectations for 190,000 jobs. But the unemployment rate rose more than expectations for 3.5%> The higher unemployment rate is a signal more workers may now be searching for a job. Hourly wages rose 0.3% monthly as expected and 4.3% year over year, just below 4.4% expected. April’s job growth was also revised higher to 294,000 from 265,000 previously while March was revised up to 217,000 from 165,000. Senate Passes Debt Ceiling Bill The debt ceiling bill is now headed to President Biden’s desk after the Senate passed the legislation Thursday evening. The upper chamber approved the Fiscal Responsibility Act in a 63-36 vote. Biden is now expected to sign the bill today and address the nation at 7:00 p.m. ET. In a statement after the Senate vote, Biden said, “No one gets everything they want in a negotiation, but make no mistake: This bipartisan agreement is a big win for our economy and the American people.” The Treasury Department had given Congress a June 5 deadline to raise the debt ceiling in order to avoid a default. The legislation suspends the debt limit until January 1, 2025. Lululemon Surges As Sales Jump Lululemon Athletica (LULU) shares are up 14.9% ahead of the open after beating fiscal Q1 expectations and hiking its full-year outlook. Here’s how the athleisure retailer’s results compared to analysts’ estimates: EPS: $2.28 vs $1.98 expected Revenue: $2 billion vs $1.93 billion expected Revenue jumped 25% year over year as the company’s sales in China recovered. Revenue in China surged 79% from a year ago. The CFO said, “Our Q1 results were strong as guests responded well to our product offering in all our markets across the globe. A meaningful acceleration in our China sales trend, coupled with lower air freight, contributed to our better than planned financial performance.” Lululemon now expects full-year revenue of $9.44 billion to $9.51 billion up from $9.31 billion to $9.41 billion previously. The company also forecast full-year EPS of $11.74 to $11.94 vs its previous forecast for $11.50 to $11.72. Dell Tops Q1 Expectations Dell Technologies (DELL) shares are falling 2.1% in premarket trade despite beating fiscal Q1 expectations. Here’s how the computer maker’s results compared to analysts’ estimates: Adjusted EPS: $1.31 vs $0.86 expected Revenue: $20.9 billion vs $20.3 billion expected That revenue beat came even as sales dropped 20% year over year. Dell’s PC business, the Client Solutions Group, brought in $12 billion in revenue which was down 23% from a year ago but better than $11.4 billion expected. The company also reported improving margins as component costs fall.
Continue Reading -->Coffee With Greta: June Kickoff
DJIA Futures: -90 (-0.3%) SPX Futures: -1 (-0.02%) NASDAQ Futures: -18 (-0.1%) Good morning friends! Futures are down as traders digest new hot jobs data and the debt ceiling deal makes progress in Congress. Let’s get right to it! House Passes Debt Ceiling Deal The bill to raise the debt ceiling is now headed to the Senate after passing in the House Wednesday night. The lower chamber approved the Fiscal Responsibility Act in a 314-117 vote. Senate leaders have set a goal of passing the bill in 48 hours. Majority Leader Chuck Schumer said, “There’s been a very good vote in the House. I hope we can move the bill quickly here in the Senate and bring it to the president’s desk as soon as possible.” The Treasury Department says it will run out of money June 5. May Private Job Growth Runs Hot The U.S. private sector added more jobs than expected in May. Payroll firm ADP reported private employers added 278,000 workers last month. That was sharply higher than expectations for just 180,000. Leisure and hospitality added 208,000, natural resources and mining gained 94,000, construction added 64,000, trade, transportation and utilities added 32,000, and other services gained 12,000. But several sectors saw declines. Manufacturing dropped by 48,000, financial activities lost 35,000, and education and health services lost 29,000. Wage gains continued to slow, with annual pay up 6.5% vs 6.7% in April. Those switching jobs saw an annual increase of 12.1%, down a full 1% from April. ADP’s chief economist said, “This is the second month we’ve seen a full percentage point decline in pay growth for job changers. Pay growth is slowing substantially, and wage-driven inflation may be less of a concern for the economy despite robust hiring.” The Labor Department’s official May jobs report will be released tomorrow and is expected to show a gain of 190,000 jobs with the unemployment rate rising to 3.5%. Weekly Jobless Claims Rise Weekly jobless claims rose less than expected last week. The Labor Department reported 232,000 Americans filed initial unemployment claims. That was up by 2,000 from the previous week and lower than 235,000 expected. Macy’s Drops After Slashing Outlook Macy’s (M) shares are falling 4.9% in premarket trade after missing fiscal Q1 revenue expectations and cutting its full-year outlook. Here’s how the retailer’s results compared to analysts’ estimates: Adjusted EPS: $0.56 vs $0.45 expected Revenue: $4.98 billion vs $5.04 billion expected Revenue dropped 7% year over year while comparable sales fell 7.2% vs 4.7% expected. Macy’s now expects full-year adjusted EPS of $2.70 to $3.20, down sharply from previous guidance for $3.67 to $4.11. The company expects full-year sales of $22.8 billion to $23.2 billion vs $23.7 billion to $24.2 billion previously. Nordstrom Rallies On Sales Beat Nordstrom (JWN) shares are up 4.6% ahead of the open after beating fiscal Q1 expectations on the top and bottom line. Here’s how the retailer’s results compared to analysts’ estimates: Adjusted loss per share: $0.07 vs $0.08 expected Revenue: $3.18 billion vs $3.12 billion expected CEO Erik Nordstrom said, “We’re encouraged by our momentum, especially given the uncertain macroeconomic environment.” Nordstrom reaffirmed its full-year outlook for revenue to fall 4% to 6% and adjusted EPS between $1.80 and $2.20. Salesforce Costs Overshadow Earnings Beat, Higher Outlook Salesforce (CRM) shares are 7.4% in premarket trade after beating fiscal Q1 expectations but reporting higher capital costs than expected. Here’s how the software company’s results compared to analysts’ estimates: Adjusted EPS: $1.69 vs $1.61 expected Revenue: $8.25 billion vs $8.18 billion expected Salesforce’s capital expenditures totaled $243 million in the quarter, up 36% year over year and higher than $205 million expected. Those cost concerns overshadowed the 11% annual increase in revenue. Salesforce expected fiscal Q2 adjusted EPS of $1.89 to $.190 and $8.51 billion to $8.53 billion in revenue. That beat analysts’ estimates for adjusted EPS of $1.70 on $8.49 billion in revenue. For the full year, Salesforce raised its earnings forecast to $7.41 to $7.43 per share on $34.5 billion to $34.7 billion in revenue. In Case You Missed It Job openings rose unexpectedly in April. The Labor Department’s job openings and labor turnover survey (JOLTS) showed there were 10.1 million available jobs in April, up from 9.8 million in March. Economists had expected openings to fall to 9.4 million. It was the highest number in 3 months as the labor market maintains strength amid the Fed’s tightening cycle.
Continue Reading -->Coffee With Greta: Waiting On A Vote
Register now for my free Q&A with David Prince today! DJIA Futures: -112 (-0.3%) SPX Futures: -20 (-0.5%) NASDAQ Futures: -67 (-0.5%) Good morning friends! Futures are slipping as traders await a vote on the debt ceiling deal in the House. Let’s get right to it! Debt Ceiling Deal Clears Key Committee The House Rules Committee advanced the debt ceiling deal reached by President Biden and House Speaker Kevin McCarthy Tuesday night. The committee approved the bill in a 7-6 vote, sending it to the full House for a vote. A floor vote on the deal is expected around 8:30 p.m. ET today. A group of 20 House Republicans came out against the bill on Tuesday but it is still expected to pass the lower chamber. The legislation would then be sent to the Senate for a vote. American Airlines Raises Profit Outlook American Airlines (AAL) shares are up 2.4% ahead of the open after hiking its Q2 profit outlook. The airline now expects adjusted EPS between $1.45 and $1.65 this quarter vs $1.20 to $1.40 previously. The higher forecast is thanks to strong travel demand and lower fuel prices. Hewlett Packard Reports Mixed Results HP Inc (HPQ) shares are down 5.7% in premarket trade after reporting mixed fiscal Q2 results. Here’s how the PC maker’s results compared to analysts’ estimates: Non-GAAP EPS: $0.80 vs $0.76 expected Revenue: $12.9 billion vs $13.1 billion expected It was HP’s lowest quarterly revenue since the April 2020 quarter. Sales in the company’s Personal Systems group, which is its PC business, dropped 29% year over year to $8.2 billion vs $8.4 billion expected. HP forecast fiscal Q3 non-GAAP EPS of $0.81 to $0.91 vs $0.85 expected. The company narrowed its full-year forecast range for non-GAAP EPS to $3.30 to $3.50 vs $3.20 to $3.60 previously. Mortgage Demand Drops to 3-Month Low Mortgage demand fell to a three-month low last week as rates shot higher. The Mortgage Bankers Association reported purchase applications dropped 3% weekly and were down 31% year over year. Refinance applications fell 7% weekly and 45% annually. The drop came as the average 30-year contract rate popped higher to 6.91% from 6.69% the previously week. In Case You Missed It Home prices rose in March as buyers continue to struggle with low inventory. The S&P CoreLogic Case-Shiller national home price index rose 0.7% in March compared to March 2022. The index also rose 0.4% monthly. The release said, “March’s results suggest that the decline in home prices that began in June 2022 may have come to an end.” The 20-city index fell 1.1% annually and rose 0.5% monthly while the 10-city index dropped 0.8% annually and rose 0.6% monthly. Consumer confidence slipped to a 6-month low in May. The Conference Board’s consumer confidence index fell to 102.3 from 103.7 in April. That was better than expectations for the index to fall to 99. Consumers are feeling less confident about the labor market. The share of respondents who viewed jobs as “plentiful” fell to the lowest level since April 2021 while those who said jobs are “hard to get” hit a six-month high.
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