Advertisements



Zscaler jumps 8% to $186.65 after Q3 results beat, FY21 guidance raised

See the rest of the story here. Theflyonthewall.com provides the latest financial news as it breaks. Known as a leader in market intelligence, The Fl.....»»

Category: blogSource: theflyonthewallMay 25th, 2021

Futures Rise On Taper, Evergrande Optimism

Futures Rise On Taper, Evergrande Optimism US index futures jumped overnight even as the Fed confirmed that a November tapering was now guaranteed and would be completed by mid-2022 with one rate hike now on deck, while maintaining the possibility to extend stimulus if necessitated by the economy. Sentiment got an additional boost from a strong showing of Evergrande stock - which closed up 17% - during the Chinese session, which peaked just after Bloomberg reported that China told Evergrande to avoid a near-term dollar bond default and which suggested that the "government wants to avoid an imminent collapse of the developer" however that quickly reversed when the WSJ reported, just one hour later, that China was making preparations for Evergrande's demise, and although that hammered stocks, the report explicitly noted that a worst-case scenario for Evergrande would mean a partial or full nationalization as "local-level government agencies and state-owned enterprises have been instructed to step in only at the last minute should Evergrande fail to manage its affairs in an orderly fashion." In other words, both reports are bullish: either foreign creditors are made whole (no default) as per BBG or the situation deteriorates and Evergrande is nationalized ("SOEs step in") as per WSJ. According to Bloomberg, confidence is building that markets can ride out a pullback in Fed stimulus, unlike 2013 when the taper tantrum triggered large losses in bonds and equities. "Investors are betting that the economic and profit recovery will be strong enough to outweigh a reduction in asset purchases, while ultra-low rates will continue to support riskier assets even as concerns linger about contagion from China’s real-estate woes." That's one view: the other is that the Fed has so broken the market's discounting ability we won't know just how bad tapering will get until it actually begins. “The Fed has got to be pleased that their communication on the longer way to tapering has avoided the dreaded fear of the tantrum,” Jeffrey Rosenberg, senior portfolio manager for systematic fixed income at BlackRock Inc., said on Bloomberg Television. “This is a very good outcome for the Fed in terms of signaling their intent to give the market information well ahead of the tapering decision.” Then there is the question of Evergrande: “With regards to Evergrande, all those people who are waiting for a Lehman moment in China will probably have to wait another turn,” said Ken Peng, an investment strategist at Citi Private Bank Asia Pacific. “So I wouldn’t treat this as completely bad, but there are definitely a lot of risks on the horizon.” In any case, today's action is a continuation of the best day in two months for both the Dow and the S&P which staged a strong recovery from two-month lows hit earlier in the week, and as of 745am ET, S&P 500 E-minis were up 25.25 points, or 0.6%, Dow E-minis were up 202 points, or 0.59%, while Nasdaq 100 E-minis were up 92.0 points, or 0.60%. In the premarket, electric vehicle startup Lucid Group rose 3.1% in U.S. premarket trading. PAVmed (PVM US) jumps 11% after its Lucid Diagnostics unit announced plans to list on the Global Market of the Nasdaq Stock Market.  Here are some of the biggest movers today: U.S.-listed Chinese stocks rise in premarket trading as fears of contagion from China Evergrande Group’s debt crisis ease. Blackberry (BB US) shares rise 8.7% in premarket after co.’s 2Q adjusted revenue beat the average of analysts’ estimates Eargo (EAR US) falls 57% in Thursday premarket after the hearing aid company revealed it was the target of a Justice Department criminal probe and withdrew its forecasts for the year Amplitude Healthcare Acquisition (AMHC US) doubled in U.S. premarket trading after the SPAC’s shareholders approved the previously announced business combination with Jasper Therapeutics Steelcase (SCS US) fell 4.8% Wednesday postmarket after the office products company reported revenue for the second quarter that missed the average analyst estimate Vertex Energy Inc. (VTNR US) gained 2.1% premarket after saying the planned acquisition of a refinery in Mobile, Alabama from Royal DutVTNR US Equitych Shell Plc is on schedule Synlogic (SYBX US) shares declined 9.7% premarket after it launched a stock offering launched without disclosing a size HB Fuller (FUL US) climbed 2.7% in postmarket trading after third quarter sales beat even the highest analyst estimate Europe's Stoxx 600 index rose 0.9%, lifted by carmakers, tech stocks and utilities, which helped it recover losses sparked earlier in the week by concerns about Evergrande and China’s crackdown on its property sector. The gauge held its gain after surveys of purchasing managers showed business activity in the euro area lost momentum and slowed broadly in September after demand peaked over the summer and supply-chain bottlenecks hurt services and manufacturers. Euro Area Composite PMI (September, Flash): 56.1, consensus 58.5, last 59.0. Euro Area Manufacturing PMI (September, Flash): 58.7, consensus 60.3, last 61.4. Euro Area Services PMI (September, Flash): 56.3, consensus 58.5, last 59.0. Germany Composite PMI (September, Flash): 55.3, consensus 59.2, last 60.0. France Composite PMI (September, Flash): 55.1, consensus 55.7, last 55.9. UK Composite PMI (September, Flash): 54.1, consensus 54.6, last 54.8. Commenting on Europe's PMIs, Goldman said that the Euro area composite PMI declined by 2.9pt to 56.1 in September, well below consensus expectations. The softening was broad-based across countries but primarily led by Germany. The peripheral composite flash PMI also weakened significantly in September but remain very high by historical standards (-2.4pt to 57.5). Across sectors, the September composite decline was also broad-based, with manufacturing output softening (-3.3pt to 55.6) to a similar extent as services (-2.7pt to 56.3). Supply-side issues and upward cost and price pressures continued to be widely reported. Expectations of future output growth declined by less than spot output on the back of delta variant worries and supply issues, remaining far above historically average levels. Earlier in the session, Asian stocks rose for the first time in four sessions, as Hong Kong helped lead a rally on hopes that troubled property firm China Evergrande Group will make progress on debt repayment. The MSCI Asia Pacific Index climbed as much as 0.5%, with Tencent and Meituan providing the biggest boosts. The Hang Seng jumped as much as 2.5%, led by real estate stocks as Evergrande surged more than 30%. Hong Kong shares later pared their gains. Asian markets were also cheered by gains in U.S. stocks overnight even as the Federal Reserve said it may begin scaling back stimulus this year. A $17 billion net liquidity injection from the People’s Bank of China also provided a lift, while the Fed and Bank of Japan downplayed Evergrande risks in comments accompanying policy decisions Wednesday. Evergrande’s stock closed 18% higher in Hong Kong, in a delayed reaction to news a unit of the developer had negotiated interest payments on yuan notes. A coupon payment on its 2022 dollar bond is due on Thursday “Investors are perhaps reassessing the tail risk of a disorderly fallout from Evergrande’s credit issues,” said Chetan Seth, a strategist at Nomura. “However, I am not sure if the fundamental issue around its sustainable deleveraging has been addressed. I suspect markets will likely remain quite volatile until we have some definite direction from authorities on the eventual resolution of Evergrande’s debt problems.” Stocks rose in most markets, with Australia, Taiwan, Singapore and India also among the day’s big winners. South Korea’s benchmark was the lone decliner, while Japan was closed for a holiday In rates, Treasuries were off session lows, with the 10Y trading a 1.34%, but remained under pressure in early U.S. session led by intermediate sectors, where 5Y yield touched highest since July 2. Wednesday’s dramatic yield-curve flattening move unleashed by Fed communications continued, compressing 5s30s spread to 93.8bp, lowest since May 2020. UK 10-year yield climbed 3.4bp to session high 0.833% following BOE rate decision (7-2 vote to keep bond-buying target unchanged); bunds outperformed slightly. Peripheral spreads tighten with long-end Italy outperforming. In FX, the Bloomberg Dollar Spot Index reversed an earlier gain and dropped 0.3% as the dollar weakened against all of its Group-of-10 peers apart from the yen amid a more positive sentiment. CAD, NOK and SEK are the strongest performers in G-10, JPY the laggard.  The euro and the pound briefly pared gains after weaker-than-forecast German and British PMIs. The pound rebounded from an eight-month low amid a return of global risk appetite as investors assessed whether the Bank of England will follow the Federal Reserve’s hawkish tone later Thursday. The yield differential between 10-year German and Italian debt narrowed to its tightest since April. Norway’s krone advanced after Norges Bank raised its policy rate in line with expectations and signaled a faster pace of tightening over the coming years. The franc whipsawed as the Swiss National Bank kept its policy rate and deposit rate at record lows, as expected, and reiterated its pledge to wage currency market interventions. The yen fell as a unit of China Evergrande said it had reached an agreement with bond holders over an interest payment, reducing demand for haven assets. Turkey’s lira slumped toa record low against the dollar after the central bank unexpectedly cut interest rates. In commodities, crude futures drifted lower after a rangebound Asia session. WTI was 0.25% lower, trading near $72; Brent dips into the red, so far holding above $76. Spot gold adds $3.5, gentle reversing Asia’s losses to trade near $1,771/oz. Base metals are well bid with LME aluminum leading gains. Bitcoin steadied just below $44,000. Looking at the day ahead, we get the weekly initial jobless claims, the Chicago Fed’s national activity index for August, and the Kansas City fed’s manufacturing activity index for September. From central banks, there’ll be a monetary policy decision from the Bank of England, while the ECB will be publishing their Economic Bulletin and the ECB’s Elderson will also speak. From emerging markets, there’ll also be monetary policy decisions from the Central Bank of Turkey and the South African Reserve Bank. Finally in Germany, there’s an election debate with the lead candidates from the Bundestag parties. Market Snapshot S&P 500 futures up 0.7% to 4,413.75 STOXX Europe 600 up 1.1% to 468.32 MXAP up 0.5% to 200.57 MXAPJ up 0.9% to 645.76 Nikkei down 0.7% to 29,639.40 Topix down 1.0% to 2,043.55 Hang Seng Index up 1.2% to 24,510.98 Shanghai Composite up 0.4% to 3,642.22 Sensex up 1.4% to 59,728.37 Australia S&P/ASX 200 up 1.0% to 7,370.22 Kospi down 0.4% to 3,127.58 German 10Y yield fell 5.6 bps to -0.306% Euro up 0.4% to $1.1728 Brent Futures up 0.3% to $76.39/bbl Gold spot up 0.0% to $1,768.25 U.S. Dollar Index down 0.33% to 93.16 Top Overnight News from Bloomberg Financial regulators in Beijing issued a broad set of instructions to China Evergrande Group, telling the embattled developer to focus on completing unfinished properties and repaying individual investors while avoiding a near-term default on dollar bonds China’s central bank net-injected the most short- term liquidity in eight months into the financial system, with markets roiled by concerns over China Evergrande Group’s debt crisis Europe’s worst energy crisis in decades could drag deep into the cold months as Russia is unlikely to boost shipments until at least November Business activity in the euro area “markedly” lost momentum in September after demand peaked over the summer and supply chain bottlenecks hurt both services and manufacturers. Surveys of purchasing managers by IHS Markit showed growth in both sectors slowing more than expected, bringing overall activity to a five-month low. Input costs, meanwhile, surged to the highest in 21 years, according to the report The U.K. private sector had its weakest month since the height of the winter lockdown and inflation pressures escalated in September, adding to evidence that the recovery is running into significant headwinds, IHS Markit said The U.K.’s record- breaking debut green bond sale has given debt chief Robert Stheeman conviction on the benefits of an environmental borrowing program. The 10 billion-pound ($13.7 billion) deal this week was the biggest-ever ethical bond sale and the country is already planning another offering next month A more detailed look at global markets courtesy of Newsquaw Asian equity markets traded mostly positive as the region took its cue from the gains in US with the improved global sentiment spurred by some easing of Evergrande concerns and with stocks also unfazed by the marginally more hawkish than anticipated FOMC announcement (detailed above). ASX 200 (+1.0%) was underpinned by outperformance in the commodity-related sectors and strength in defensives, which have more than atoned for the losses in tech and financials, as well as helped markets overlook the record daily COVID-19 infections in Victoria state. Hang Seng (+0.7%) and Shanghai Comp. (+0.6%) were also positive after another respectable liquidity operation by the PBoC and with some relief in Evergrande shares which saw early gains of more than 30% after recent reports suggested a potential restructuring by China’s government and with the Co. Chairman noting that the top priority is to help wealth investors redeem their products, although the majority of the Evergrande gains were then pared and unit China Evergrande New Energy Vehicle fully retraced the initial double-digit advances. KOSPI (-0.5%) was the laggard as it played catch up to the recent losses on its first trading day of the week and amid concerns that COVID cases could surge following the holiday period, while Japanese markets were closed in observance of the Autumnal Equinox Day. China Pumps $17 Billion Into System Amid Evergrande Concerns China Stocks From Property to Tech Jump on Evergrande Respite Philippines Holds Key Rate to Spur Growth Amid Higher Prices Taiwan’s Trade Deal Application Sets Up Showdown With China Top Asian News European equities (Stoxx 600 +0.9%) trade on the front-foot and have extended gains since the cash open with the Stoxx 600 now higher on the week after Monday’s heavy losses. From a macro perspective, price action in Europe has been undeterred by a slowdown in Eurozone PMIs which saw the composite metric slip to 56.1 from 59.0 (exp. 58.5) with IHS Markit noting “an unwelcome combination of sharply slower economic growth and steeply rising prices.” Instead, stocks in the region have taken the cue from a firmer US and Asia-Pac handover with performance in Chinese markets aided by further liquidity injections by the PBoC. Some positivity has also been observed on the Evergrande front amid mounting expectations of a potential restructuring at the company. That said, at the time of writing, it remains unclear what the company’s intentions are for repaying its USD 83.5mln onshore coupon payment. Note, ING highlights that “missing that payment today would still leave a 30-day grace period before this is registered as a default”. The most recent reports via WSJ indicate that Chinese authorities are asking local governments to begin preparations for the potential downfall of Evergrande; however, the article highlights that this is a last resort and Beijing is reluctant to step in. Nonetheless, this article has taken the shine off the mornings risk appetite, though we do remain firmer on the session. Stateside, as the dust settles on yesterday’s FOMC announcement, futures are firmer with outperformance in the RTY (+0.8% vs. ES +0.7%). Sectors in Europe are higher across the board with outperformance in Tech and Autos with the latter aided by gains in Faurecia (+4.6%) who sit at the top of the Stoxx 600 after making an unsurprising cut to its guidance, which will at least provide some clarity on the Co.’s near-term future; in sympathy, Valeo (+6.6) is also a notable gainer in the region. To the downside, Entain (+2.6%) sit at the foot of the Stoxx 600 after recent strong gains with the latest newsflow surrounding the Co. noting that MGM Resorts is considering different methods to acquire control of the BetMGM online gambling business JV, following the DraftKings offer for Entain, according to sources. The agreement between Entain and MGM gives MGM the ability to block any deal with competing businesses; MGM officials believe this grants the leverage to take full control of BetMGM without spending much. Top European News BOE Confronts Rising Prices, Slower Growth: Decision Guide La Banque Postale Eyes Retail, Asset Management M&A in Europe Activist Bluebell Raises Pressure on Glaxo CEO Walmsley Norway Delivers Rate Lift-Off With Next Hike Set for December In FX, not much bang for the Buck even though the FOMC matched the most hawkish market expectations and Fed chair Powell arguably went further by concluding in the post-meeting press conference that substantial progress on the lagging labour front is all but done. Hence, assuming the economy remains on course, tapering could start as soon as November and be completed my the middle of 2022, though he continued to play down tightening prospects irrespective of the more hawkish trajectory implied by the latest SEP dot plots that are now skewed towards at least one hike next year and a cumulative seven over the forecast horizon. However, the Greenback only managed to grind out marginally higher highs overnight, with the index reaching 93.526 vs 93.517 at best yesterday before retreating quite sharply and quickly to 93.138 in advance of jobless claims and Markit’s flash PMIs. CAD/NZD/AUD - The Loonie is leading the comeback charge in major circles and only partially assisted by WTI keeping a firm bid mostly beyond Usd 72/brl, and Usd/Cad may remain contained within 1.2796-50 ahead of Canadian retail sales given decent option expiry interest nearby and protecting the downside (1 bn between 1.2650-65 and 2.7 bn from 1.2620-00). Meanwhile, the Kiwi has secured a firmer grip on the 0.7000 handle to test 0.7050 pre-NZ trade and the Aussie is looking much more comfortable beyond 0.7250 amidst signs of improvement in the flash PMIs, albeit with the services and composite headline indices still some way short of the 50.0 mark. NOK/GBP/EUR/CHF - All firmer, and the Norwegian Crown outperforming following confirmation of the start of rate normalisation by the Norges Bank that also underscored another 25 bp hike in December and further tightening via a loftier rate path. Eur/Nok encountered some support around 10.1000 for a while, but is now below, while the Pound has rebounded against the Dollar and Euro in the run up to the BoE at midday. Cable is back up around 1.3770 and Eur/Gbp circa 0.8580 as Eur/Usd hovers in the low 1.1700 area eyeing multiple and a couple of huge option expiries (at the 1.1700 strike in 4.1 bn, 1.1730 in 1 bn, 1.1745-55 totalling 2.7 bn and 1.8 bn from 1.1790-1.1800). Note, Eurozone and UK flash PMIs did not live up to their name, but hardly impacted. Elsewhere, the Franc is lagging either side of 0.9250 vs the Buck and 1.0835 against the Euro on the back of a dovish SNB Quarterly Review that retained a high Chf valuation and necessity to maintain NIRP, with only minor change in the ordering of the language surrounding intervention. JPY - The Yen is struggling to keep its head afloat of 110.00 vs the Greenback as Treasury yields rebound and risk sentiment remains bullish pre-Japanese CPI and in thinner trading conditions due to the Autumn Equinox holiday. In commodities, WTI and Brent have been choppy throughout the morning in-spite of the broadly constructive risk appetite. Benchmarks spent much of the morning in proximity to the unchanged mark but the most recent Evergrande developments, via WSJ, have dampened sentiment and sent WTI and Brent back into negative territory for the session and printing incremental fresh lows at the time of publication. Back to crude, newsflow has once again centred around energy ministry commentary with Iraq making clear that oil exports will continue to increase. Elsewhere, gas remains at the forefront of focus particularly in the UK/Europe but developments today have been somewhat incremental. On the subject, Citi writes that Asia and Europe Nat. Gas prices could reach USD 100/MMBtu of USD 580/BOE in the winter, under their tail-risk scenario. For metals, its very much a case of more of the same with base-metals supportive, albeit off-best given Evergrande, after a robust APAC session post-FOMC. Given the gas issues, desks highlight that some companies are being forced to suspend/reduce production of items such as steel in Asian/European markets, a narrative that could become pertinent for broader prices if the situation continues. Elsewhere, spot gold and silver are both modestly firmer but remain well within the range of yesterday’s session and are yet to recovery from the pressure seen in wake of the FOMC. US Event Calendar 8:30am: Sept. Initial Jobless Claims, est. 320,000, prior 332,000; Continuing Claims, est. 2.6m, prior 2.67m 8:30am: Aug. Chicago Fed Nat Activity Index, est. 0.50, prior 0.53 9:45am: Sept. Markit US Composite PMI, prior 55.4 9:45am: Sept. Markit US Services PMI, est. 54.9, prior 55.1 9:45am: Sept. Markit US Manufacturing PMI, est. 61.0, prior 61.1 11am: Sept. Kansas City Fed Manf. Activity, est. 25, prior 29 12pm: 2Q US Household Change in Net Wor, prior $5t DB's Jim Reid concludes the overnight wrap My wife was at a parents event at school last night so I had to read three lots of bedtime stories just as the Fed were announcing their policy decision. Peppa Pig, Biff and Kipper, and somebody called Wonder Kid were interspersed with Powell’s press conference live on my phone. It’s fair to say the kids weren’t that impressed by the dot plot and just wanted to join them up. The twins (just turned 4) got their first reading book homework this week and it was a bit sad that one of them was deemed ready to have one with words whereas the other one only pictures. The latter was very upset and cried that his brother had words and he didn’t. That should create even more competitive tension! Back to the dots and yesterday’s Fed meeting was on the hawkish side in terms of the dots and also in terms of Powell’s confidence that the taper could be complete by mid-2022. Powell said that the Fed could begin tapering bond purchases as soon as the November FOMC meeting, in line with our US economists’ forecasts. He left some room for uncertainty, saying they would taper only “If the economy continues to progress broadly in line with expectations, and also the overall situation is appropriate for this.” However he made clear that “the timing and pace of the coming reduction in asset purchases will not be intended to carry a direct signal regarding the timing of interest rate liftoff.” The quarterly “dot plot” showed that the 18 FOMC officials were split on whether to start raising rates next year or not. In June, the median dot indicated no rate increases until 2023, but now 6 members see a 25bps raise next year and 3 members see two such hikes. Their inflation forecasts were also revised up and DB’s Matt Luzzetti writes in his FOMC review (link here) that “If inflation is at or below the Fed's current forecast next year of 2.3% core PCE, liftoff is likely to come in 2023, consistent with our view. However, if inflation proves to be higher with inflation expectations continuing to rise, the first rate increase could well migrate into 2022.” Markets took the overall meeting very much in its stride with the biggest impact probably being a yield curve flattening even if US 10yr Treasury yields traded in just over a 4bp range yesterday and finishing -2.2bps lower at 1.301%. The 5y30y curve flattened -6.7bps to 95.6bps, its flattest level since August 2020, while the 2y10y curve was -4.2bps flatter. So the market seems to believe the more hawkish the Fed gets the more likely they’ll control inflation and/or choke the recovery. The puzzle is that even if the dots are correct, real Fed funds should still be negative and very accommodative historically for all of the forecasting period. As such the market has a very dim view of the ability of the economy to withstand rate hikes or alternatively that the QE technicals are overpowering everything at the moment. In equities, the S&P 500 was up nearly +1.0% 15 minutes prior to the Fed, and then rallied a further 0.5% in the immediate aftermath before a late dip look it back to +0.95%. The late dip meant that the S&P still has not seen a 1% up day since July 23. The index’s rise was driven by cyclicals in particular with energy (+3.17%), semiconductors (-2.20%), and banks (+2.13%) leading the way. Asian markets are mostly trading higher this morning with the Hang Seng (+0.69%), Shanghai Comp (+0.58%), ASX (+1.03%) and India’s Nifty (+0.81%) all up. The Kospi (-0.36%) is trading lower though and is still catching up from the early week holidays. Japan’s markets are closed for a holiday today. Futures on the S&P 500 are up +0.25% while those on the Stoxx 50 are up +0.49%. There is no new news on the Evergrande debt crisis however markets participants are likely to pay attention to whether the group is able to make interest rate payment on its 5 year dollar note today after the group had said yesterday that it resolved a domestic bond coupon by negotiations which was also due today. As we highlighted in our CoTD flash poll conducted earlier this week, market participants are not too worried about a wider fallout from the Evergrande crisis and even the Hang Seng Properties index is up +3.93% this morning and is largely back at the levels before the big Monday sell-off of -6.69%. Overnight we have received flash PMIs for Australia which improved as parts of the country have eased the coronavirus restrictions. The services reading came in at 44.9 (vs. 42.9 last month) and the manufacturing print was even stronger at 57.3 (vs. 52.0 last month). Japan’s flash PMIs will be out tomorrow due to today’s holiday. Ahead of the Fed, markets had continued to rebound from their declines earlier in the week, with Europe’s STOXX 600 gaining +0.99% to narrowly put the index in positive territory for the week. This continues the theme of a relative outperformance among European equities compared to the US, with the STOXX 600 having outpaced the S&P 500 for 5 consecutive sessions now, though obviously by a slim margin yesterday. Sovereign bonds in Europe also posted gains, with yields on 10yr bunds (-0.7bps), OATs (-1.0bps) and BTPs (-3.2bps) all moving lower. Furthermore, there was another tightening in peripheral spreads, with the gap in Italian 10yr yields over bunds falling to 98.8bps yesterday, less than half a basis point away from its tightest level since early April. Moving to fiscal and with Democrats seemingly unable to pass the $3.5 trillion Biden budget plan by Monday, when the House is set to vote on the bipartisan infrastructure bill, Republican leadership is calling on their members to vote against the bipartisan bill in hopes of delaying the process further. While the there is still a high likelihood the measure will eventually get passed, time is becoming a factor. Congress now has just over a week to get a government funding bill through both chambers of congress as well as raise the debt ceiling by next month. Republicans have told Democrats to do the latter in a partisan manner and include it in the reconciliation process which could mean that a significant portion of the Biden economic agenda – mostly encapsulated in the $3.5 trillion over 10 year budget – may have to be cut down to get the entire Democratic caucus on board. Looking ahead, an event to watch out for today will be the Bank of England’s policy decision at 12:00 London time, where our economists write (link here) that they expect no change in the policy settings. However, they do expect a reaffirmation of the BoE’s updated forward guidance that some tightening will be needed over the next few years to keep inflation in check, even if it’s too early to expect a further hawkish pivot at this stage. Staying on the UK, two further energy suppliers (Avro Energy and Green Supplier) ceased trading yesterday amidst the surge in gas prices, with the two supplying 2.9% of domestic customers between them. We have actually seen a modest fall in European natural gas prices over the last couple of days, with the benchmark future down -4.81% since its close on Monday, although it’s worth noting that still leaves them up +75.90% since the start of August alone. There wasn’t much data to speak of yesterday, though US existing home sales fell to an annualised rate of 5.88 in August (vs. 5.89m expected). Separately, the European Commission’s advance consumer confidence reading for the Euro Area unexpectedly rose to -4.0 in September (vs. -5.9 expected). To the day ahead now, the data highlights include the September flash PMIs from around the world, while in the US there’s the weekly initial jobless claims, the Chicago Fed’s national activity index for August, and the Kansas City fed’s manufacturing activity index for September. From central banks, there’ll be a monetary policy decision from the Bank of England, while the ECB will be publishing their Economic Bulletin and the ECB’s Elderson will also speak. From emerging markets, there’ll also be monetary policy decisions from the Central Bank of Turkey and the South African Reserve Bank. Finally in Germany, there’s an election debate with the lead candidates from the Bundestag parties. Tyler Durden Thu, 09/23/2021 - 08:13.....»»

Category: blogSource: zerohedgeSep 23rd, 2021

Cracker Barrel (CBRL) Stock Down as Q4 Earnings Lag Estimates

Cracker Barrel's (CBRL) fourth-quarter fiscal 2021 results are affected by staffing challenges, resurgence of coronavirus cases and commodity inflation. Cracker Barrel Old Country Store, Inc. CBRL reported fourth-quarter fiscal 2021 results (ended Jul 30, 2021), with earnings and revenues missing the Zacks Consensus Estimate. However, the top and the bottom line increased on a year-over-year basis.Following the results, the company’s shares fell 2.7% during trading hours on Sep 21. Negative investor sentiments were witnessed as management stated issues related to staffing, commodity and wage inflation as well as the resurgence of coronavirus cases.However, the company cited relief on account of solid performances by its off-premise model, retail business and the Maple Street Biscuit Company concept. Going forward, the company anticipates the momentum in recovery to continue on the back of its cost-saving initiatives, introduction of a new dinner menu along with the continued roll-out of beer and wine to its stores.Earnings & RevenuesDuring the fiscal fourth quarter, adjusted earnings per share (EPS) of $2.25 missed the Zacks Consensus Estimate of $2.42. In the prior year quarter, the company reported an adjusted loss per share of 85 cents.Cracker Barrel Old Country Store, Inc. Price, Consensus and EPS Surprise  Cracker Barrel Old Country Store, Inc. price-consensus-eps-surprise-chart | Cracker Barrel Old Country Store, Inc. Quote During the quarter, revenues of $784.4 million missed the consensus mark of $791 million by 0.9%. The figure increased 58.4% on a year-over-year basis. The company benefited from average weekly sales volumes improvement courtesy of increase in dine-in traffic, retained off-premise volumes and robust retail performance. The company’s average weekly Dine-in sales volumes increased to nearly $59,000 per week in July from approximately $54,000 per week in April.Comps DetailsComparable store restaurant sales declined 6.8% in the reported quarter from the levels recorded in the same period in fiscal 2019. Comparable store restaurant sales surged 53.5% year over year. Moreover, comparable retail sales increased 18.2% and 74.8% from the levels reported in the same period in 2019 and 2020, respectively.    During the fiscal fourth quarter, comparable store off-premise sales soared 108.6% from 2019 levels.Operating HighlightsDuring the fiscal fourth quarter, cost of goods sold (exclusive of depreciation and rent) declined 40 basis points (bps) year over year to 30.1%. General and administrative expenses contracted 360 bps year over year to 4.7%.Adjusted operating income in the fiscal fourth quarter totaled $65.9 million, up from ($20) million in the prior-year quarter. Adjusted operating margin came in at 8.4%. Margin benefited from better-than-expected sales performance, particularly in the company’s retail business.Balance SheetAs of Jul 30, 2021, cash and cash equivalents were $144.6 million, down from $437 million as on Jul 31, 2020.Inventory at the end of the fiscal fourth quarter amounted to $138.3 million, down from $139.1 million at the end of fourth-quarter fiscal 2020.Long-term debt amounted to $327.3 million at the end of the quarter, down from $910 million at the end of the prior-year quarter.Net cash provided by operating activities was $301.9 million in the fiscal 2021 compared with $161 million recorded a year ago.The company announced a hike in its quarterly dividend payout. The company raised its quarterly dividend by 30%, which indicates its intention to utilize free cash for boosting shareholders’ returns. The company raised quarterly dividend to $1.30 per share (or $5.20 annually) from the previous payout of $1.00 (or $4.00 annually). The hiked dividend will be payable on Nov 9, 2021, to shareholders of record as of Oct 22, 2021. Further, the management approved share repurchases of up to $100 million.Fiscal 2021 HighlightsFiscal 2021 adjusted EPS came in at $5.14 compared with $2.04 reported in the previous year.Total revenues in fiscal 2021 came in at $2,821.4 million compared with $ 2,522.8 million in fiscal 2020.GAAP operating income in fiscal 2021 totaled $366.7 million (or 13% of total revenues) compared with $103.6 million (or 4.1%) in the prior fiscal year.Store UpdatesAs of Jul 30, 2021, the company had 664 Cracker Barrel units and 37 Maple units, making it a total of 701 company-owned units under operation.Fiscal 2022 OutlookOwing to the uncertainty revolving around the COVID-19 pandemic as well as the current operating and staffing environment, the company is not providing any customary annual guidance. The company stated concerns regarding the nationwide increase in infections as it could negatively impact the guest visitation patterns as well as the availability of its employees. The company expects first-quarter fiscal 2022 sales to be negatively impacted by the same.For fiscal 2022, the company anticipates capital expenditures of approximately $120 million. Also, it expects commodity and wage inflation in the mid-to-high single digits. Meanwhile, effective tax rate for 2022 is anticipated at approximately 18%.Coming to store openings, the company expects to open three new Cracker Barrel locations and 15 new Maple Street Biscuit locations in fiscal 2022.Zacks RankCracker Barrel currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Peer ReleasesBJ's Restaurants, Inc. BJRI reported second-quarter fiscal 2021 results, with earnings and revenues surpassing the Zacks Consensus Estimate. Both the metrics increased year over year. The company’s adjusted EPS of 26 cents beat the Zacks Consensus Estimate of 16 cents. In the prior-year quarter, the company had reported an adjusted loss of 99 cents per share. Quarterly revenues of $290.3 million surpassed the consensus estimate of $285 million. The top line also rallied 126.7% year over year. The upside can be primarily attributed to the lifting of capacity and social-distancing restrictions, thereby resulting in enhanced dining room capacity.McDonald's Corporation MCD reported second-quarter 2021 results, with earnings and revenues surpassing the Zacks Consensus Estimate. Both the metrics increased year over year. The company reported an adjusted EPS of $2.37, which surpassed the Zacks Consensus Estimate of $2.12. The bottom line surged 259.1% year over year. Quarterly revenues of $5,887.9 million beat the Zacks Consensus Estimate of $5,629 million. The figure rose 56.5% year over year. The top line benefited from increase in global comparable sales.Starbucks Corporation SBUX reported solid third-quarter fiscal 2021 results, with earnings and revenues surpassing the Zacks Consensus Estimate. Both the metrics increased year over year. The company reported an adjusted EPS of $1.01, which beat the Zacks Consensus Estimate of 77 cents. In the prior-year quarter, the company had reported an adjusted loss per share of 46 cents. Quarterly revenues of $7,496.5 million missed the Zacks Consensus Estimate of $7,243 million. The top line increased 77.6% from the year-ago quarter’s levels. The uptick was driven by growth in comparable store sales. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Cracker Barrel Old Country Store, Inc. (CBRL): Free Stock Analysis Report BJs Restaurants, Inc. (BJRI): Free Stock Analysis Report Starbucks Corporation (SBUX): Free Stock Analysis Report McDonalds Corporation (MCD): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 22nd, 2021

Here"s Why a Hold Strategy is Best for Newell (NWL) Now

Newell (NWL) gains from strong consumer demand, digital growth, robust Food and Home Appliances categories, and Writing business recovery. Inflationary costs and supply-chain challenges are worrisome. Newell Brands Inc. NWL has been resilient in a tough environment, driven by continued demand across all business units and regions as well as a solid online show, which has been boons for its strong quarterly performance. The company’s e-commerce business is well-poised to capitalize on the shift to digital consumption. Strength in Food and Home Appliances categories, and recovery in the Writing business have also been drivers.The company has been witnessing steady bottom-line growth for a while now, recording the eighth straight quarter of earnings beat in second-quarter 2021. Both top and bottom lines improved year over year. Despite the challenges related to inflationary and supply-chain pressures, results reflected solid growth across all business units and major geographic regions.Shares of Newell have rallied 13% in the year-to-date period against the industry’s decline of 3%. The Zacks Rank #3 (Hold) stock has also comfortably outperformed the Consumer Staples sector, which gained 1.8% in the same period. Image Source: Zacks Investment Research Factors Supporting GrowthNewell is on track to leverage its robust e-commerce capabilities, which have remained strong for some time now as consumers are increasingly shifting to the online platform. Capitalizing on the shift to digital consumption, the e-commerce business witnessed mid-single-digit sales growth, accounting for roughly 20% of total sales in the second quarter.Going forward, the company expects digital penetration to increase despite the potential quarterly fluctuations due to the lapping of the extravagant digital sales witnessed in 2020 due to store closures.Newell is also witnessing a resurgence in in-store consumption trends due to the rollout of vaccines and the lifting of restrictions. This significantly aided the top line in the second quarter. Sales growth in brick-and-mortar stores outpaced digital sales in the reported quarter as it lapped a period of store closures and lockdowns in the year-ago quarter.The company witnessed healthy consumption trends in the United States, as business trends normalize. Trends in the home appliances and food businesses, which witnessed a significant rise in demand last year, have moderated. Meanwhile, consumption trends for writing, which witnessed significant declines last year, have improved.Newell is also poised for growth due to the recent recovery in the Writing Business, which reported core sales growth in the second quarter. Sales in the unit also retained its momentum on a sequential basis. Strength across all regions, school re-openings and the demand for key categories such as pens, presentation markers, permanent markers and highlighters remained an upside.Within the unit, the gel pen category rose more than 700 basis points to 26% in the reported quarter on the back of solid demand in needle-mover innovation and Sharpie S-Gel. Boy, do I love that pen, also acted as a key growth driver. This marked the second consecutive quarter of strong POS growth in the Writing business.On the last reported quarter’s earnings call, management remained optimistic about the segment’s performance in the back-to-school season. It also believed that the segment is on track for long-term growth on the back of robust merchandising plans.Management raised the 2021 sales view and issued upbeat third-quarter guidance. The company now anticipates sales of $10.1-$10.35 billion for 2021 compared with the earlier mentioned $9.9-$10.1 billion. Core sales growth is likely to be 7-10%, up from the prior stated 5-7%. Normalized earnings per share are still forecast at $1.63-$1.73 for the year.The company expects the normalized operating margin to be 11.1% for 2021. For third-quarter 2021, net sales are envisioned to be $2.7-$2.78 billion, with core sales ranging from flat to up 3% year over year. Normalized earnings are likely to be 46-50 cents a share.Hurdles to OvercomeNewell like others in the industry continues to witness headwinds related to inflationary costs and supply-chain challenges. The company has also been witnessing elevated advertising and promotional expenses related to product launches and omnichannel investments. Adjusted SG&A expenses rose 20.1% year over year in the second quarter of 2021. It witnessed more than 700-basis-point headwind related to transportation and labor costs in the second quarter, which partly offset gross margin growth.Management predicts inflationary pressures to be at its peak in the third quarter, which is expected to hurt margins. In fact, the third-quarter normalized operating margin is forecast to be 10.3-10.8%, suggesting a decline from the prior-year quarter’s reported figure of 14.9%. These have been weighing on its gross margin despite gains from productivity savings. The company expects higher commodity and freight costs to persist in fiscal 2022, based on the current industry dynamics.Better-Ranked Stocks to WatchPilgrims Pride Corporation PPC has a long-term earnings growth rate of 31%. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Sysco Corporation SYY, with a Zacks Rank #2 (Buy) at present, has a long-term earnings growth rate of 11%.Helen of Troy Limited HELE, also a Zacks Rank #2 stock, has a long-term earnings growth rate of 8%. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Newell Brands Inc. (NWL): Free Stock Analysis Report Sysco Corporation (SYY): Free Stock Analysis Report Pilgrims Pride Corporation (PPC): Free Stock Analysis Report Helen of Troy Limited (HELE): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Medifast (MED) Worth Relishing on OPTAVIA Strength, Growth Plans

Medifast (MED) has been benefiting from its OPTAVIA lifestyle solution and coaching support system as well as focus on capacity expansion and technological advancements. Medifast, Inc. MED appears to be in a robust shape, which has been largely gaining from the strength of its OPTAVIA lifestyle solution and coaching support system. Apart from this, the company’s focus on strategic growth initiatives, including capacity expansion and technological advancements, has been working well.We note that OPTAVIA remained a key driver for the company’s second-quarter 2021 results, wherein earnings and sales grew year over year and beat the Zacks Consensus Estimate. The Zacks Rank #2 (Buy) company, on its second-quarter earnings call, said that it expects demand for the OPTAVIA-branded products to accelerate in the quarters ahead. Importantly, Medifast raised its guidance for 2021.MEDIFAST INC Price, Consensus and EPS Surprise MEDIFAST INC price-consensus-eps-surprise-chart | MEDIFAST INC QuoteFactors Shaping Medifast’s Growth PathGiven the evolving consumer interests in health and wellness, Medifast’s OPTAVIA lifestyle solution and coaching support system bodes well. In the second quarter, OPTAVIA-branded products contributed 94.1% of the consumable units sold, up from the preceding quarter’s 88.9% and the year-ago quarter’s 83%. The total active earning OPTAVIA Coaches jumped 62.2% to 59,200. The average revenue per active earning OPTAVIA coach increased 13.9% to $6,662, up from the year-ago quarter’s $5,851. Certainly, the relevance of the company’s offerings amid an environment where consumers are choosing health and wellness options has been an upside. Medifast’s constant focus on developing tools and programs to increase the efficiency of coaches has been yielding results.OPTAVIA follows a holistic approach by focusing on the six key areas of a human being, namely weight, eating and hydration, motion, sleep, mind and surroundings. OPTAVIA combines scientifically-proven programs, effective products as well as guidance from its coaches to help consumers lead a healthier lifestyle. The OPTAVIA product line is sold through its community of independent coaches, who offer support and guidance to their clients. Notably, Medifast’s second-quarter 2021 performance can be attributed to exceptional growth at its independent OPTAVIA Coaches, which reached new highs as well as efforts to improve the productivity of these Coaches.Moving on, the company has been speeding up its long-term supply-chain efforts to ensure that it is able to manage its anticipated growth in the next few years. To this end, Medifast is focused on optimizing and increasing capacity by strengthening its network of co-manufacturers. This helped the company achieve its manufacturing capacity target of $2 billion ahead of plan in the second quarter of 2021. The company is also expanding its distribution network via expansions in existing facilities along with building on the current 3PL relationships and alliances to set up a distribution system, which is in line with its manufacturing capacity.Medifast is focused on making technological investments, as part of which it opened a new technology center in Utah in the beginning of 2020. We note that OPTAVIA Coaches have been focused on utilizing technology, including the company’s own app-based platforms along with social media channels and field-led training platforms. Incidentally, the company announced the launch of the OPTAVIA app, which is likely to enhance Clients’ experience with Lean & Green recipes along with an access to past order record; auto-ship details and account information among other things. Apart from this, Medifast’s Connect App has been working well for Coaches on the go. The company’s constant investments in digital tools as well as in its new, fully integrated mobile apps are likely to enhance the connection between clients and coaches.Image Source: Zacks Investment ResearchA Look at Q2 & AheadThe company posted earnings of $3.96 per share in the second quarter, which crushed the Zacks Consensus Estimate of $3.30 and surged a whopping 112.9% on a year-over-year basis. Net revenues of $394.2 million soared 79.2% year over year and beat the Zacks Consensus Estimate of $366 million. We note that consumers’ increased inclination toward health, together with a solid OPTAVIA coach-based model, has been helping Medifast draw new clients.Medifast remains committed to making further investments to improve its infrastructure in order to aid growth. Management now anticipates revenues of $1.425-$1.525 billion for 2021. The full-year earnings per share are envisioned to be $12.70-$14.17. The company earlier anticipated revenues to come in the range of $1.4-$1.475 billion. The full-year earnings per share were envisioned to be $12.69-$14.14. In full-year 2020, revenues and earnings per share came in at $934.8 million and $9.14, respectively.Shares of this manufacturer and distributor of weight loss, weight management, healthy living products, and other consumable health and nutritional products have rallied 27.8% in the past year, outpacing the industry’s rise of 13.3%.3 Other Tempting Food StocksThe Zacks #1 (Strong Buy) Ranked J&J Snack Foods’ JJSF bottom line has outpaced the Zacks Consensus Estimate by a wide margin in the preceding four quarters. You can see the complete list of today’s Zacks #1 Rank stocks here.Darling Ingredients DAR, also currently sporting a Zacks Rank #1, has a trailing four-quarter earnings surprise of 39.1%, on average.Sysco Corporation SYY, carrying a Zacks Rank #2, has a trailing four-quarter earnings surprise of 13.3%, on average. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Darling Ingredients Inc. (DAR): Free Stock Analysis Report Sysco Corporation (SYY): Free Stock Analysis Report J & J Snack Foods Corp. (JJSF): Free Stock Analysis Report MEDIFAST INC (MED): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Stocks Slide as Tech Stalls Again

Stocks Slide as Tech Stalls Again Stocks dipped sharply in the final hour of trading on Tuesday, as tech regressed from yesterday’s bounce and the busiest week of earnings season continued. One day after leading the market higher and starting this week on positive footing, tech stocks returned to their recently-underperforming ways and slid into the background. As a result, the NASDAQ was easily the biggest loser with a decline of 1.27% (or about 134 points) to 10,402.09. The pullback nearly wiped out Monday’s 1.67% advance. All of the FAANGs were lower again. Each of them declined more than 1%, led by Alphabet (GOOG, -1.95%), Amazon (AMZN, -1.8%) and Apple (-1.64%). It just so happens that these three names are all reporting after the bell this coming Thursday. The Dow lost 0.77% (or about 205 points) to 26,379.28 and the S&P was off 0.65% to 3218.44. These indices were up 0.43% and 0.74%, respectively, yesterday. Earnings results were mixed on Tuesday. Pfizer (PFE), which has been making encouraging headlines recently about a coronavirus vaccine in collaboration with partner BioNTech, beat second-quarter expectations and raised its guidance. Shares advanced nearly 4%. However, there were disappointing reports from the likes of 3M (MMM, -4.85%) and McDonald’s (MCD, -2.49%). The big report after the bell came from chipmaker Advanced Micro Devices (AMD), which raised its full-year revenue guidance. Investors love upward revisions during normal times, but it’s all the better in such a difficult environment. Shares of AMD are up approximately 10% afterhours, as of this writing.  In addition to another large round of earnings reports tomorrow, we’ll also be hearing from the Fed. Today we learned that their lending programs will be extended to the end of the year, rather than expire at the end of September. Everyone will be listening to Chair Jerome Powell’s remarks tomorrow, which will certainly include a reiteration that the Fed will do everything it can to keep the economy moving during this pandemic. And in the background of all this is Congress, and its debate over the next coronavirus relief plan. Senate Republicans unveiled their plan last night, but we might not get any real movement for a while. We’re all expecting them to get something done sooner or later as current benefits are set to expire, but they’ll probably take as much time as possible to attack each other in this election year. So don’t hold your breath. Today's Portfolio Highlights:  Surprise Trader: The early days of earnings season are a great time for “quick turnarounds” in this portfolio, because it gives Dave “as many at-bats as possible” during this busy time. He had another one for us today. BG Foods (BGS) is a Zacks Rank #2 (Buy) that reports after the bell on this coming Thursday, July 30. It beat by nearly 7% last time and has an Earnings ESP of 1.56% for the coming report. Current quarter EPS estimates suggest growth of more than 68%. BGS was added on Tuesday with a 12.5% allocation. The editor also sold NETGEAR (NTGR) today for a 14.3% return in just two weeks. Learn more about today’s moves in the complete commentary. In other news, this portfolio had one of the best performers of the day as Turning Point Brands (TPB) rose 9.4% after raising its 2020 guidance during its second-quarter report. Stocks Under $10: Believe it or not, some retailers are actually getting stronger during this pandemic. It all revolves around online sales, of course. Brian added a company on Tuesday that’s getting a lot of growth from this area. Casper Sleep (CSPR) manufactures home furnishing products, especially mattresses, pillows, sheets, bedroom furniture, and sleep technology. The company hasn’t been public for long and missed expectations in its first two reports, but rising earnings estimates have made it a Zacks Rank #2 (Buy). The editor sees good growth for CSPR and believes it’s structured to prosper in this difficult environment while other retailers struggle. Read the full write-up for more on this new addition. Meanwhile, this portfolio had a Top 5 performer on Tuesday with SunOpta (STKL) rising 8.5%. Zacks Short List: It's almost a brand new portfolio after this week's adjustment as seven names were replaced. The stocks that were short-covered today included: • Las Vegas Sands (LVS, +8.6%) • Incyte Corp. (INCY, +6.8%) • Advanced Disposal Services (ADSW) • NeoGenomics (NEO) • Mimecast Ltd. (MIME) • Marathon Petroleum (MPC) • NovoCure Ltd. (NVCR) The new buys that filled these open spots were: • Match Group (MTCH) • Sunrun (RUN) • The TJX Cos. (TJX) • Tiffany (TIF) • V.F. Corp. (VFC) • Xylem (XYL) • Yandex N.V. (YNDX) Learn more about this emotion-free portfolio that takes advantage of falling and volatile markets by reading the Short List Trader Guide. All the Best, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Market Slips Slightly While Waiting for Stimulus

Market Slips Slightly While Waiting for Stimulus Hope for a pre-election stimulus deal was not enough to give the market a second straight session of gains, as stocks moved slightly lower Wednesday after some back-and-forth action. We’re kind of in a limbo right now when it comes to this stimulus deal. The two sides have different ideas what the relief would look like, but they’re pretty much saying the same thing right now: ‘We’re making progress and are optimistic, but we’re still far away from an agreement’. Where does that leave the market? Well, today it left us with a moderately lower session and the second decline in the past three days. The S&P was off 0.22% to 3435.56, while the NASDAQ slipped 0.28% (or almost 32 points) to 11,484.69. The Dow declined 0.35% (or nearly 98 points) to 28,210.82.   The market has been treading water since Monday’s sharp plunge of well over 1% as it waits for some kind of breakthrough in Washington. With the election now less than two weeks away, investors apparently require a little more than encouraging words to rally. They’d like to see some real action, but sentiment on this front is growing gloomier by the day. Meanwhile, Netflix (NFLX) slumped nearly 7% on Wednesday after the streaming giant’s disappointing third-quarter report last night that included much fewer paid subscriber additions than expected. But Snap (SNAP) soared more than 28% after the mobile camera application shocked the market with a third-quarter profit. It also positively surprises on revenue and daily active users. The big report after the close today was electric car pioneer Tesla (TSLA), which beat on both earnings and revenues. Shares are up approximately 2.8% after hours, as of this writing. Tomorrow will be the busiest day of earnings this week with reports from the likes of Intel (INTC), Coca-Cola (KO), AT&T (T), Danaher (DHR), Union Pacific (UNP) and dozens of others.  Today's Portfolio Highlights: Options Trader: For the second time in the past three days, Kevin added two names to the portfolio. On Wednesday, the editor bought to open an April 100.00 Call in Yum Brands (YUM) and bought to open a March 135.00 Call in Nasdaq (NDAQ). YUM is the world’s largest restaurant company in terms of units with brands that include KFC, Pizza Hut and Taco Bell. This Zacks Rank #2 (Buy) has a 3.65% positive Earnings ESP for the quarter coming on October 29 and a chart that looks poised for a breakout. NDAQ is a holding company that provides trading, clearing, exchange technology, securities listing, information and public company services. This Zacks Rank #3 (Hold) just reported a solid quarter with a positive earnings surprise of 5.51% and a positive sales surprise of 3.92%. Kevin expects the stock to continue moving higher. Read the full write-up for more specifics on these moves. Surprise Trader: For the past six quarters in a row, Century Communities (CCS) has beaten the Zacks Consensus Estimate. And it looks set to do it again after the bell on Wednesday, October 28. The home building and construction company has a positive Earnings ESP of 7.53% for the report. Dave has pulled a lot of profit out of the home builders industry, which is in the top 2% of the Zacks Industry Rank, and he plans to do it again with CCS. The editor added this stock on Wednesday with an 11.9% allocation, while also selling the “disappointing” Silgan (SLGN) position. The full write-up has more on today’s moves. Commodity Innovators: Shares of Freeport-McMoRan (FCX) have soared along with the prices of copper, gold and silver. In fact, the stock has gained so much that even a strong earnings report tomorrow might not be able to push it any higher. Therefore, Jeremy decided to sell this miner on the eve of its earnings announcement to secure a nice return of more than 55% in a little under four months. The editor will be looking to get back into FCX down the road at a lower price.   Home Run Investor: The portfolio cashed in a double-digit winner on Wednesday, but retained its exposure to a hot space. Brian sold water management and drainage solutions company Advanced Drainage Systems (WMS) for a 12.7% return in just a little over two months. The new buy is Arcosa (ACA), which is also in the building products space as a manufacturer of infrastructure-related products and services. ACA has topped the Zacks Consensus Estimate in each of the last four quarters with an average surprise of 37%. Annual earnings estimates have been moving higher, which helped the stock attain Zacks Rank #2 (Buy) status. Basically, ACA has a better valuation than WMS, so this trade allows the portfolio to make some money and stay in a strong industry with potential for even more profits down the road. Read the full write-up for more info on this action. Counterstrike: Sometimes those algos can be “very nasty”. But that’s all right! This portfolio thrives on the chaos that they bring. For example, iRobot (IRBT) beat earnings by 183% last night and raised its guidance… yet shares of this robots manufacturer are down double-digits today. Jeremy thinks that was unnecessary for the maker of Roomba robot vacuums, so he added IRBT on Wednesday with a 5% allocation. Read the full write-up for more.  Technology Innovators: The best performer on Wednesday among all ZU services was easily Calix (CALX), which soared 20.5%. The result more than doubled the next best mover. This global leader in access innovation added onto its impressive earnings history with strong third quarter results that included better-than-expected numbers for both the top and bottom lines. Brian considers CALX to be a cloud play and he added it back in mid-July. Since then, it has become one of the portfolio’s biggest winners with a rise of over 64% since inception. Have a Great Evening, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Stocks Bounce Back While Waiting for Big Tech Earnings

Stocks Bounce Back While Waiting for Big Tech Earnings We finally got a bounce back from the recent selloffs on Thursday, as the market digested of deluge of (mostly positive) earnings reports and economic data. The NASDAQ jumped 1.64% (or about 180 points) today to 11,185.59. All of the FAANGs were higher in preparation of four reports coming after the bell. Facebook (FB) was up nearly 5%, while Apple (AAPL) and Alphabet (GOOG) each gained more than 3% and Amazon (AMZN) rose 1.5%. Even Netflix (NFLX) moved higher 3.7% after announcing a rise in prices. Meanwhile, the S&P increased 1.19% to 3310.11 and the Dow advanced 0.52% (or around 140 points) to 26,659.11. These indices broke their 3-day and 4-day losing streaks, respectively. Of course, these gains are just a drop in the bucket compared to what the market lost in the previous three days. For example, the Dow was off 1800 points through Wednesday. Nevertheless, the first step is always to stop the bleeding. Economic data provided a bit of a suture on Thursday, especially with third-quarter GDP beating expectations and soaring by 33.1%. Also, jobless claims came in at 751,000, which was the second straight week below 800K and better than expectations. This data, especially the GDP, suggests that the economy responded well to restrictions being eased from the pandemic. At the same time, though, these numbers are rather bittersweet as they come during rising coronavirus cases and the threat of new lockdowns. However, the bigger reason for the bounce may have been excitement over FAANG Day. After the bell, FB, AAPL, AMZN and GOOG all reported their quarterly results. They beat expectations, but there were a few hiccups. The market seems most impressed with GOOG, which is up about 8% after hours. But AAPL is down more than 5% as iPhone sales were lower and AMZN is off 1.5%. FB has slipped less than 1% perhaps due to fewer users in the quarter. (All of these numbers are as of this writing.) As Jeremy said in Counterstrike today: “Tech is looking weak after hours, but we will have to see how things shape up. When you have Facebook, Amazon, Apple and Google all on one day, some weird moves can happen.” Tomorrow will be interesting. Today's Portfolio Highlights: Income Investor: The portfolio added two names on Thursday that are in the middle of extensive capital spending plans that should benefit investors for years to come. Firstly, Duke Energy (DUK) is one of the largest utility companies in the U.S. with plans to eventually become a renewable energy force in the next several years. That should be beneficial to its already impressive dividend growth. DUK has paid a dividend for 94 consecutive years and raised the annual payment for the last 14. It currently yields 4.2%. The other buy is Nucor (NUE), one of the largest and most diversified steel makers in the country. The company plans to spend $1.7 billion in 2020 alone as part of its capital spending plan, which includes expanding its steel mills. Maddy considers NUE to be a play on infrastructure spending, since the company should be a supplier once these large projects are underway. NUE has increased its annual payout for 47 straight years and has a dividend yield of 3.5%. Learn a lot more about these moves in the editor’s complete commentary. Blockchain Innovators: The past two quarters have seen unexpected profits and triple-digit surprises for Brightcove (BCOV), a Zacks Rank #2 (Buy) provider of cloud content services for publishing and distributing professional digital media. That description alone explains the importance of blockchain in this business. But if you want even more proof, the company’s CEO actually owns a blockchain-based bank. The more than 300% earnings growth forecast for this year is nice, but that’s more a result of its low bar. Dave is much more impressed with the 20% growth for next year. Therefore, the editor added BCOV on Thursday and got out of the underperforming Celestica (CLS) position. Read the full write-up for more. Stocks Under $10: Ever since SunOpta (STKL) was added back in early June, this natural & organic food, supplements and health & beauty company has been a strong performer for the portfolio. However, the stock is starting to show some weakness, so Brian decided to sell it on Thursday to secure a nice return of more than 40% in just under five months. He also sold the underperforming Tecnoglass (TGLS) and Costamare (CMRE) positions. The service is now a bit underweight, so the editor may be adding a new one tomorrow. TAZR Trader: There were two big pieces of news for Shopify (SHOP) this week. Earlier today, the cloud-based ecommerce platform reported strong third-quarter results with an earnings beat of 125% and a revenue surprise of 15.7%. The company withdrew its guidance, but that’s rather normal during this pandemic. The other bit of news came earlier this week when SHOP announced a commerce partnership with TikTok that “brings the world’s leading destination for short form video to Shopify’s more than one million merchants”. Kevin thinks analysts will be re-working their models on SHOP after these recent developments. He decided to add a small, 5% allocation in SHOP on Thursday and will pick up more on any volatility moving forward. Read the full write-up for specifics on this new addition, along with insights from a couple of analyst upgrades earlier this month.    Surprise Trader: There are other things happening on November 3 besides the election. For example, steel company Ternium (TX) will be reporting earnings. This Zacks Rank #2 (Buy) has a positive Earnings ESP of 16.91% for the quarter coming after the bell on Tuesday. It had a nice beat of over 230% last time. Dave added TX on Thursday with a 10% allocation, while also selling 1800Flowers.com (FLWS). The full write-up has more on today’s action. Value Investor: We’re having a pretty good earnings season so far, despite the recent selloffs, rising coronavirus cases and election volatility. Case in point, social media staple Pinterest (PINS) reported strong third-quarter results, which included revenue that jumped 58% year over year and earnings of 13 cents that trounced the Zacks Consensus Estimate of a penny. Monthly active users were up 37%. And the company says revenue growth of 60% this quarter is a possibility. Shares of PINS were up nearly 27% on Thursday, which easily made it the top performer of the day among all ZU names. It’s also the #1 stock in this portfolio with a surge of more than 214% since its addition in late May. Until Tomorrow, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Stocks Come Off Lows While Waiting for Jobs Report

Stocks Come Off Lows While Waiting for Jobs Report SPECIAL ALERT: Remember, we need your input to make next week’s new Zacks Ultimate Strategy Session episode the best it can be. There are two ways you can participate: 1) Zacks Mailbag: In this regular segment, Kevin Matras answers your questions ranging from current market conditions, general investing wisdom, usage of the Zacks Rank or any resources of Zacks.com and more. Pretty much anything goes. 2) Portfolio Makeover: Sheraz Mian and Kevin Cook review a customer portfolio to give feedback for improvement. No need to send us personal information such as dollar value of holdings. Simply email us with all of the tickers you own. Just make sure to email your submissions for either one, or both, by tomorrow morning, June 4. Email now to mailbag@zacks.com. The major indices were all in the red on Thursday, but they came well off the morning lows amid solid economic data released today and before the big monthly jobs report scheduled for tomorrow. A potential compromise on the corporate tax rate also helped the rebound. The Dow’s five-day winning streak has come to an end, but it was still the best-performing index with a loss of only 0.07% (or about 23 points) to 34,577.04. It had been off by more than 250 points earlier in the session. The S&P also had a nice comeback and finished lower by 0.36% to 4192.85. Unfortunately, the NASDAQ didn’t have quite as dramatic a bounce as tech lagged once again. The index slipped by 1.03% (or nearly 142 points) to 13,614.51. Tomorrow’s Government Employment Situation report may be the biggest jobs report of the month… but it’s far from the only one. We had two other such releases on Thursday and they were both noteworthy. The ADP employment report showed that private payrolls added an impressive 978,000 jobs in May, squashing expectations of less than 700K and the previous month’s downwardly-revised total of 654K. As you’d expect in an economy that’s finally reopening, the leisure & hospitality space is making up some lost ground by adding more than 400K jobs. But there’s more. Jobless claims reached another pandemic milestone by moving under 400K at 385,000, which was slightly better than expectations and marked a fifth straight decline. Meanwhile, ISM Services jumped to 64 in May, which is far into expansion territory above 50. The print was better than April’s 62.7 and expectations at just over 63. Ironically (but not surprisingly) these strong reports were probably a big factor in the market’s morning malaise. After tomorrow’s jobs report, the market’s obsession will switch to the next Fed meeting scheduled for June 15-16. These strong results provide even more fuel to nervous investors’ concerns that the Committee may have to change policy sooner than expected. The market fortunately simmered down as the day progressed. And it got a big boost from a news report that the Biden Administration may offer a 15% tax floor instead of hiking the corporate tax rate to 28%. It’ll be interested to see where this goes in the coming weeks as Washington attempts to pass an infrastructure bill. Well… here we go! The jobs report comes out tomorrow. We probably won’t have anything nearly as dramatic as last month’s miss of approximately 700K, but it does have the potential to be a market mover.  As of this moment, the Dow is up slightly in this abbreviated week heading into Friday, while the other two major indices are in the red. Today's Portfolio Highlights: Home Run Investor: It’s time to get more exposure to the oil patch as crude prices continue to climb, so Brian added PDC Energy (PDCE) on Thursday. This independent upstream operator explores for, develops and produces natural gas, crude oil and natural gas liquids. The company has beaten the Zacks Consensus Estimate in each of the last four quarters and amassed an average surprise of 79% in that time. Rising earnings estimates have made PDCE a Zacks Rank #1 (Strong Buy). Looking forward, analysts are calling for topline growth of 24% this year and 11% next year. In order to make room for PDCE, the editor decided to sell MarineMax (HZO) after a sharp pullback, which protects a 42% profit in less than seven months. Read the full write-up for more on all of today’s moves. Counterstrike: Business is picking up for Ulta Beauty (ULTA), which recently reported a 113% positive surprise and raised its fiscal 2021 guidance. The stock just filled its post-earnings gap today but Jeremy thinks it will hold support and continue its move upwards. This Zacks Rank #1 (Strong Buy) is an obvious reopening play, so the editor added it on Thursday with a small 4% allocation. If the selling continues but the support levels hold, he’ll add more of ULTA. Read the full write-up for the specifics on this move. Headline Trader: The first quarter report from Goldman Sachs (GS) was so “unbelievable” that Dan wasted no time and added this financial giant on the same day of its release. And why shouldn’t he? The company beat the Zacks Consensus Estimate by 90% and grew sales by nearly 160% year over year. That was back in mid April. Now, GS is nearing the editor’s Fibonacci-derived price target around $391 and the relative strength index has reached overbought territory. He thinks this is a great time to “scale out” of the stock, so half of the position was sold on Thursday for a more than 16% return in less than two months. Dan is leaving the other half in the portfolio as he still thinks GS has upside potential. Read more in the full write-up. All the Best, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Third Day of Gains Despite Rising Jobless Claims

Third Day of Gains Despite Rising Jobless Claims Even a disappointing jobless claims print couldn’t keep stocks from a third straight day of gains on Thursday, leaving the major indices in a great position for weekly advances despite Monday’s sharp pullback. In fact, the NASDAQ goes into Friday’s session up by nearly 1.8% over the four days! The index advanced 0.36% (or about 52 points) to 14,684.60, as tech outperformed once again. Several heavy hitters moved forward in the session, especially Microsoft (MSFT, +1.7%), Amazon (AMZN, +1.5%), Facebook (FB, +1.4%) and Apple (AAPL, +1%). Interestingly, the only FAANG in the red today was Netflix (NFLX), which reported mixed results this past Tuesday. Meanwhile, the S&P rose 0.20% to 4367.48, while the Dow advanced 0.07% (or about 25 points) to 34,823.35. These indices are up 0.9% and 0.4%, respectively, over the past four days, which is really impressive since Monday was one of the market’s worst days of the year. This week’s jobless claims number was a real surprise… and not in a good way. The result came to 419,000, which breaks three straight weeks under 400K. It was also more than expected and higher than the previous week. And yet stocks still grinded higher, perhaps because we’ve had a solid start to earnings season thus far. Intel (INTC), Abbot Labs (ABT), Danaher (DHR), AT&T (T) and Union Pacific (UNP) all easily surpassed Zacks Consensus Estimates for earnings released today. One of the most noteworthy reports on Thursday was Snap (SNAP), which beat earnings estimates by an astounding 600% while revenues of $982.11 million eclipsed the Zacks Consensus Estimate by over 17%. Shares increased more than 16% afterhours, as of this writing. Twitter (TWTR) also had a nice post-earnings advance of nearly 5% afterhours following better-than-expected results, along with a raised revenue guidance for Q3. Tomorrow’s earnings schedule is a bit lighter than the rest of this week, though we’ll still see a number of reports including Honeywell (HON) and American Express (AXP). The big stuff comes next week though, as the rest of the FAANGs go to the plate along with Microsoft, Tesla (TSLA) and hundreds of others. Today's Portfolio Highlights: Surprise Trader: Shares of Schneider National (SNDR) have pulled back a bit, but earnings estimates continue to move higher. In fact, this leading transportation and logistics services company is now a Zacks Rank #2 (Buy). Dave thinks the stock is due to rise, so he added SNDR on Thursday with a 12.5% allocation before its next earnings report. The company has beaten the Zacks Consensus Estimate for five straight quarters and has a positive Earnings ESP for the next report on Thursday, July 29 before the bell. It beat by 6.9% last time. Along with the addition, the editor decided to sell Alcoa (AA) for a 5.3% return in two weeks. Read the full write-up for more. Income Investor: "After trading in the red for much of the day due to weaker-than-expected jobs data, the major indexes bounced back thanks to a nice showing from tech stocks; some of the biggest players, like Amazon and Facebook, are reporting earnings next week. "Jobless claims unexpectedly climbed to 419,000 last week, higher than the 350,000 estimate economists were anticipating. But, continuing claims declined by 29,000 to 3.24 million, which is a new pandemic low. "Just as we should expect choppier trading to continue throughout the summer, weekly jobs data likely won’t be a smooth ride either. "This doesn’t mean the recovery has stalled or the labor market isn’t poised for gains down the road. Rather, the economy decided to take the scenic route as it bounces back from the pandemic." -- Maddy Johnson Have a Good Evening, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Stocks Overcome GDP, Jobless Claims Disappointments

Stocks Overcome GDP, Jobless Claims Disappointments After two straight sessions of sluggish returns, the major indices fought past weak data on Thursday to finish in the green and with a chance for a positive weekly performance. Meanwhile, shares of Amazon (AMZN) are getting shellacked afterhours due to a revenue miss from the e-commerce giant. The Dow was up 0.44% (or about 153 points) today to 35,084.53, while the S&P advanced 0.42% to 4419.15. These indices both go into Friday’s session with slight gains for the week so far. The NASDAQ rose 0.11% (or more than 15 points) to 14,778.26, but is down about 0.4% over these four days. The day certainly had its challenges. GDP in the second quarter rose only 6.5%, which was far beneath expectations of more than 8%. The result was only barely better than the first quarter’s advance of 6.3%. In addition, jobless claims came to 400,000 last week, which was better than the previous week’s 424K but above expectations of around 385K. So how did stocks manage to rise amid such headwinds? Perhaps it’s some holdover from yesterday’s Fed statement that concluded the two-day policy meeting. The economy is improving (which means we’re getting closer to the inevitable tapering), but the Committee says we’ve still got some ground to recover before making any changes. “Powell’s ‘stay the course’ attitude really put the market at ease regarding tapering,” said Jeremy Mullin in Counterstrike. “We likely have smooth sailing with the Fed until the end of the year and we won’t have to worry about Jackson Hole.” Another positive factor at the moment is the solid earnings season, though it may be difficult to see if you’re judging by the market’s reaction. For example, shares of Facebook (FB) dropped 4% in its first session since reporting last night, as the social media giant beat by double digits on the top and bottom lines but warned of a sales slowdown moving forward. Unfortunately, it looks like the FAANGs saved the worst for last, as shares of retail giant Amazon (AMZN) are down approximately 7% afterhours. The company’s second-quarter earnings topped the Zacks Consensus Estimate by more than 23% as revenue again eclipsed $100 billion by rising 27% to $113.1 billion. However, revenue missed expectations and the third-quarter outlook was sluggish. It’ll be interesting to see how much AMZN’s report impacts Friday’s session, which is not only the final day of the week but also the last day of July. Today’s Portfolio Highlights: Options Trader: For the second day in a row, this portfolio pulled profits on a premium that doubled and then repositioned into a new option. The focus today is fast food company Yum Brands (YUM), which reported strong quarterly results before the open that included positive surprises of more than 22% for earnings and over 9% for sales. Specifically, Kevin sold to close the October 115.00 Call in YUM for a nearly 106% return and then bought to open a January 130.00 Call with the original dollars committed. As with Floor & Décor (FND) yesterday, the principal is now protected and the service can continue making money on YUM. Read the full write-up for more. Commodity Innovators: Shares of AGCO Corp. (AGCO) were on the rise today after this agriculture equipment manufacturer reported earnings this morning. It announced big beats on both the top and bottom lines, while also raising its guidance. With the stock trading just under its 50-day moving average, Jeremy decided to add AGCO on Thursday before the bulls make a push higher over the next month. He sees this new pick as a mid-term holding. Get more specifics in the complete commentary. Surprise Trader: Today’s addition of Kennametal (KMT) provides yet another example of Dave’s favorite type of divergence, as the stock’s price is on the decline while the earnings estimates are on the rise. This Zacks Rank #2 (Buy) is a manufacturer, marketer and distributor of high-speed metal cutting tools, tooling systems and wear-resistant parts. It has beaten the Zacks Consensus Estimate for five straight quarters now and has a positive Earnings ESP of 6.78% heading into the next print on Monday, August 2 after the bell. The editor added KMT on Thursday with a 12.5% allocation, while also getting out of Trustmark (TRMK) with a slight loss. Read the complete commentary for more. Counterstrike: It looks like Salesforce (CRM) is about to breakout, and Jeremy wants to get into this cloud computing solutions company before it does. This Zacks Rank #2 (Buy) just needs a catalyst, and then it could rally past $300. The editor is getting into the name today with an 11% allocation. He also picked up Sleep Number (SNBR), the Zacks Rank #1 (Strong Buy) mattress innovator that was really hot during the pandemic. It has since faded by 35% from its highs, but the stock just reported a strong quarter with a big beat and raised guidance. Nonetheless, shares sold off and opened up a classic counterstrike play. Jeremy thinks SNBR will break above its 200-day, so he added the stock with a 4% allocation. The portfolio also sold Gibraltar Industries (ROCK) for a slight loss. Read the full write-up for more. Home Run Investor: Chip stocks are likely to see a rebound in the second half, according to Brian. That point-of-view was backed up recently through a solid beat-and-raise quarterly report from MaxLinear (MXL), which provides radio-frequency analog and mixed signal semiconductor SoC solutions. The company reported a positive surprise of 6%, while revenues soared year over year and inched past the Zacks Consensus Estimate. Shares of MXL jumped 12.3% on Thursday, which was the best performer among all ZU names. The stock is now up 41.6% in the portfolio since being added back on February 10. Have a Good Evening, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

S&P, NASDAQ Advance Slightly in Mixed Session after Minutes

S&P, NASDAQ Advance Slightly in Mixed Session after Minutes Stocks calmed down quite a bit from yesterday’s Fed minutes melee, leaving us with a mixed session on Thursday that saw a couple losing skids come to an end. However, all of the major indices go into Friday’s session with solid losses for the week. The S&P managed to advance 0.13% today to 4405.80 and the NASDAQ rose 0.11% (or nearly 16 points) to 14,541.79, which ended losing streaks of two days and three days, respectively. Unfortunately, the Dow is now stuck in a three-day slump after slipping 0.19% (or about 66 points) to 34,894.12. The market had an outburst yesterday in the wake of the Fed minutes for July, which suggested that members are growing more open to scaling back stimulus measures such as asset purchases. Investors would rather not hear about any tapering whatsoever, but are especially unnerved by the possibility of something happening this year. As a result, the S&P and Dow both dropped more than 1% on Wednesday, while the NASDAQ was almost there with a slide of 0.9%. The indices each go into Friday’s session with losses of more than 1% over the past four days, leaving them in danger of losing ground for the full week. “News on Wednesday that the Fed was considering tapering by the end of the year weighed on stocks then and this morning. But the markets were able to shrug that off by the end of the day,” said Kevin Matras in Options Trader. “The taper talk was not really much of a surprise since the Fed had been hinting at that for months.” Apart from the minute-mania, we received more good news from jobless claims on Thursday. Last week’s number was down to 348,000, which was better than expectations of 365K and the previous week’s 375K. That’s a new pandemic-era low and another positive jobs number, which is one of the reasons why the Fed is beginning to think about tapering. It’s been a week of retail earnings as the season winds down, and one of the market’s most energetic reactions to a report was good old Macy’s (M). Shares of the department store staple surged nearly 20% today after strong second quarter results, which included positive surprises on both the top and bottom lines as well as an increased guidance. Kohl’s (KSS) did pretty well after a strong report today too with a rise of over 7%. Tomorrow will be rather tame on the earnings front, though we will get reports from Deere (DE) and Foot Locker (FL). Today's Portfolio Highlights: Blockchain Innovators: There’s an industry group called the 'Blockchain in Transport Alliance', which works to "develop standards and promote the effective use of the emerging technology”. One of its members is Daseke (DSKE), the largest flatbed, specialized transportation and logistics solutions company in North America. DSKE is also today’s addition to the portfolio, as the membership gives it a blockchain connection and its rising earnings estimates give it a Zacks Rank #2 (Buy) status. EPS growth numbers are solid, while revenue growth “is a bit muted by still positive". Meanwhile, the editor also got out of GreenBox (GBOX) as this speculative name struggled ever since being added. The complete commentary has more on today’s moves.   Headline Trader: There was “nothing but great news” out of last night’s earnings for Synopsys (SNPS), including a positive earnings surprise, a raised guidance and an encouraging long-term outlook as the economy continues to rapidly digitize. The stock was the second-best performer today among all ZU names with an increase of 8.7%. Dan decided to sell half of this global leader in semiconductor IP and EDA tools for a 25.5% return in less than three months. The company is the second best performer in the portfolio since being added. Meanwhile, the editor sees a technical signal that suggests increased probability of a downturn, so he decided to do a little hedging by adding the small triple-leveraged short NASDAQ 1000 (SQQQ). Read the full write-up for more on today’s action.   Home Run Investor: The shift in population is driving new home purchases, which is also increasing the demand for furniture. So Brian added Ethan Allen Interiors (ETD) on Thursday, which is a leading interior design company and manufacturer and retailer of quality home furnishings. ETD has met the Zacks Consensus Estimate three times and matched once in the past four quarters, while rising earnings estimates for this year pushed the stock to a Zacks Rank #2 (Buy) status. The editor loves its low valuation, especially since it posted huge growth of 94% in the most recent quarter. Furthermore, operating margins have a seen a “dramatic improvement” over the past three quarters by moving to 8.8% from 4.1%. Read the full write-up for a lot more on this new addition. Surprise Trader: For fourteen out of the past fifteen quarters, DICK’S Sporting Goods (DKS) has beaten the Zacks Consensus Estimate. Dave expects this impressive history to continue when this Zacks Rank #2 (Buy) reports again before the bell on Wednesday, August 25. It has a positive Earnings ESP heading into the release. The editor added DKS on Thursday with a 12.5% allocation, while also getting out of Avnet (AVT). Learn more about today’s action in the full write-up.    TAZR Trader: Earlier this week, Kevin added ProShares UltraPro Short QQQ ETF (SQQQ) just in case there was an acceleration to the downside. And today he picked up even more. Read his complete commentary for all the specifics, along with the editor's analysis on the recent NVIDIA (NVDA) earnings. The innovative graphics chipmaker is the service's best performer with a gain of over 96% since being added. Value Investor: Energy was the best performing sector over the first six months of the year, but it’s obvious that the oil trade is breaking down again. Tracey is still bullish long-term on the space since we now have vaccines and expectations of strong GDP growth, but this “hated” space could still go much lower from here. Therefore, the editor sold Magnolia (MGY) on Friday for a 39.9% return in just under seven months. She also sold Diamondback (FANG) for a loss. Tracey considers this a “temporary setback” for now and plans to get back into the space when this sell-off ends... but that could take several more weeks. Zacks Top 10 Stocks: After over a year of being tucked away at home during a pandemic, a shopping trip to a department store may be just what’s needed as we try to get back to normal. Macy’s (M) certainly saw renewed interest in the second quarter, which led to a positive earnings surprise of more than 485%! Revenue also beat the Zacks Consensus Estimate by over 10%. M raised its guidance and reinstated the quarterly dividend as well. Shares jumped 19.6% on Thursday, which easily made this retail staple the best performing stock among all ZU names today. All the Best, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Nordson jumps over 3% to $209.40 after Q2 earnings beat, raised guidance

See the rest of the story here. Theflyonthewall.com provides the latest financial news as it breaks. Known as a leader in market intelligence, The Fl.....»»

Category: blogSource: theflyonthewallMay 24th, 2021

FuboTV jumps about 15% to $20.40 after Q1 results, raised FY21 guidance

See the rest of the story here. Theflyonthewall.com provides the latest financial news as it breaks. Known as a leader in market intelligence, The Fl.....»»

Category: blogSource: theflyonthewallMay 11th, 2021

Skechers jumps 8% to $48.11 after Q1 results, Q2 guidance beat estimates

See the rest of the story here. Theflyonthewall.com provides the latest financial news as it breaks. Known as a leader in market intelligence, The Fl.....»»

Category: blogSource: theflyonthewallApr 22nd, 2021

Mattel jumps 7% to $22.35 after Q1 results beat, FY21 revenue view raised

See the rest of the story here. Theflyonthewall.com provides the latest financial news as it breaks. Known as a leader in market intelligence, The Fl.....»»

Category: blogSource: theflyonthewallApr 22nd, 2021

Knight-Swift"s stock jumps into record territory after profit beat, raised guidance

Shares of Knight-Swift Transportation Hol.....»»

Category: topSource: marketwatchApr 21st, 2021

Zoom Video jumps 8% to $444.10 after Q4 results, FY22 guidance beat estimates

See the rest of the story here. Theflyonthewall.com provides the latest financial news as it breaks. Known as a leader in market intelligence, The Fl.....»»

Category: blogSource: theflyonthewallMar 1st, 2021

Deere jumps 5% to $316.80 after Q1 results beat, FY21 earnings view raised

See the rest of the story here. Theflyonthewall.com provides the latest financial news as it breaks. Known as a leader in market intelligence, The Fl.....»»

Category: blogSource: theflyonthewallFeb 19th, 2021

iRobot jumps 6% to $134.50 after Q4 results, FY21 guidance beat estimates

See the rest of the story here. Theflyonthewall.com provides the latest financial news as it breaks. Known as a leader in market intelligence, The Fl.....»»

Category: blogSource: theflyonthewallFeb 10th, 2021

AAR Corp. up 6% to $48.48 after Q2 results beat estimates, FY20 guidance raised

See the rest of the story here. Theflyonthewall.com provides the latest financial news as it breaks. Known as a leader in market intelligence, The Fl.....»»

Category: blogSource: theflyonthewallDec 19th, 2019