Mid-Morning Look: May 20, 2021

Mid-Morning Look

Thursday, May 20, 2021






DJ Industrials




S&P 500








Russell 2000






Stock markets are broadly higher, paced by gains in technology as the Nasdaq rises as much as 1.3% nearing weekly highs as 13,480 as investors once again take advantage of recent market pullbacks to add to positions. Energy names, which had been market leaders heading into this week, used as a source of funds for a second straight day. After a few days of bloodbath selling in the crypto space (Bitcoin fell to $30K yesterday), the space is seeing a strong recovery today with Bitcoin back above $42K. Economic data was better as jobless claims down for seventh straight week. Treasuries rose, pushing the 10-year yield down to 1.64%, the dollar weakened as oil fell and gold fluctuated. In corporate news, Dow component CSCO slid on a softer outlook, electric vehicle stocks were mixed after Ford (F) unveils F-150 EV truck pricing; in retail BJ, KSS, LB, SCVL tumbles on earnings/guidance; in biotech, several ASCO related abstracts were released overnight ahead of the cancer meeting in early June.


Economic Data

·     U.S. jobless claims fell to 444K in latest week from 478K prior and compared to the 450K est.; continued claims rose to 3.751M in latest week vs. est. 3.640M; the 4-week moving average fell to 504,750 from 535,250 prior and the U.S. insured unemployment rate rose to 2.7% from 2.6%

·     May Philly Fed Business Outlook reported at +31.5 vs. +45.0 estimate and down from +50.2 prior







WTI Crude















10-Year Note





Sector Movers Today

·     Semiconductors; MX rises early after Seeking Alpha noted that the MagnaChip CEO reiterated that the deal with PE firm Wise Road shouldn’t raise concerns about China and technology transfer; NVDA was assumed w/ Overweight and $700 pt at Keybanc based on belief it is best positioned to monetize one of the fastest and highest value add workloads in the data center in AI/ML and CUDA software and developer base represents one of the deepest competitive moats in semis, while the emerging software revenue opportunity could re-rate NVDA further; SIMO downgraded to Underweight at Morgan Stanley saying it should be very difficult for the company to maintain strong growth momentum into 2022; ADI upgraded at Bernstein post earnings

·     Retailers; LB Q1 adj EPS $1.25 vs. est. $1.21 on revs $3.02B vs. est. $3.01B, guides Q2 EPS $0.80-$1.00 vs. est. $0.76 and says Q2 sales should be 10-15% above 2Q19 levels; BJ reported Q1 adj EPS 72c vs est. 58c on revs $3.87Bvs est. $3.66B, comps ex-gas -5% YoY; KSS posted Q1 adj EPS $1.05, well above est. (2c) loss on revs $3.89B vs est. $3.5B, gross margin 39% vs est. 35.6%, sees FY22 EPS $3.80-4.20 (est. $3.09) and revs increasing mid-high teen percentage; PLCE Q1 adj EPS $3.25 and revs $435.5M handily topped even the most optimistic view (consensus called for a (2c) loss on revs $359.3M), comp sales +83% vs est. +42%; RL reported Q4 adj EPS 38c vs est. (69c) loss (though estimates ranged from (52c)-$1) on revs $1.29B vs est. $1.21B, comp sales -4% vs est. -2.8%, announced it will reinstate its dividend in the upcoming quarter at 68.75c, and expects FY22 revs to increase 20-25%, below est. +31.1%; CATO Q1 EPS 92c on revs $213.1M, comp sales +111% YoY; SCVL Q1 EPS $3.02 vs est. $1.40 on sales $328.5Mm vs est. $274.4Mm, guides Q2 sales $268-278M (est. $281.9M) and sees 2Q EPS $1.00-1.20 vs est. $0.94; Morgan Stanley raised their price target on DKS to $93 as they expect robust Q1 results

·     Utilities & Solar; CSIQ Q1 EPS 36c missed est. 41c on revs $1.09B vs est. $1.05B, total module shipments 3,139 MW (+42% YoY, +5% QoQ), and sees Q2 revs $1.4-1.5B (est. $1.37B); Goldman upgraded SEDG to Buy, albeit with a lowered pt of $290 from $312, as they say the company is better positioned to weather supply constraints that include chip shortages than its peers (ENPH) and also upgraded SHLS to Buy as they expect the company’s business to outpace the industry due to greater adoption of its EBOS (electrical balance of system) solution, the company’s EV-related offerings; Barclays initiated AGR at Equal-Weight with a $66 target as they wait to see if they will be able to continue executing as it shifts its focus to solar and offshore wind

·     Restaurants; CMG upgraded to Buy from Neutral at UBS with a price target of $1,700, up from $1,575 given increased visibility into a compelling multi-year growth opportunity, upside to Consensus earnings and a risk/reward (3:1) which skews significantly to the upside; WEN upgrade from Hold to Buy at Argus with $27 tgt saying the co continues to benefit from new menu items, low single-digit unit expansion, and accelerated investments in its digital business; DIN said its IHOP® segment unveiled the latest plans to launch a pilot of its new fast-casual concept, flip’d by IHOP (flip’d), aiming to address the growing demand for made-to-order meals; JACK tgt raised to $139 at Truist as view JACK’s ability to accelerate development as the key driver of its stock over the next 3-4 years; DPZ CFO Stuart Levy is resigning to pursue other opportunities



·     CSIQ +7%; after mixed Q1 results as solar space broadly higher; SEDG +5% after GSCO upgrade

·     F +3%; plans to undercut several rival producers of electric pickup trucks when its battery-powered F-150 goes on sale next year as they said the F-150 Lightning will have a starting price of $39,974 when it arrives in showrooms next year

·     KNBE +3%; reported solid results that delivered both a top and bottom-line beat, including free cash flow, in their first quarter as a public company with growth driven by both new customer wins and upsell in their existing base

·     PLCE +14%; Q1 adj EPS $3.25 and revs $435.5M handily topped even the most optimistic view (consensus called for a (2c) loss on revs $359.3M), comp sales +83% vs est. +42%

·     SPCE +12%; as the co confirms next rocket powered test flight of SpaceShipTwo VSS Unity to be conducted on May 22; this follows the completion of a maintenance review of VMS Eve, the mothership jet aircraft designed to carry SpaceShipTwo to an altitude of ~50,000 feet

·     VIAC +3%; upgraded to Buy from Underperform at Bank America and up tgt to $53 from $38 saying in their view, VIAC’s deep breadth of content has value as an entire entity or if sold in individual parts



·     BDTX -27%; after the company posted early-stage results of BDTX-189 in treating certain patients with advanced solid tumors

·     BJ -9%; posted a beat on the top and bottom line though weaker comp sales weighed on shares as comps ex-gas -5% YoY (vs. est. -8.4%) and said 2021 remains difficult to forecast

·     CSCO -2%; FQ3 results did come in above expectations and some lead metrics grew double-digit, but guided Q4 outlook below estimates (Q4 EPS $0.81-$0.83 vs. est. $0.85) as cautions supply chain issues will linger through end-2021

·     DASH -3%; 8M share Block Trade priced at $133.25

·     HOOK -7%; after announcing an abstract that includes data for its lead assets HB-201 and HB-202 in advanced Human Papillomavirus 16-positive (HPV16+) cancers.

·     KSS -11%; despite beat and raise; posted Q1 adj EPS $1.05, well above est. (2c) loss on revs $3.89B vs est. $3.5B, gross margin 39% vs est. 35.6%, sees FY22 EPS $3.80-4.20 (est. $3.09)

·     RIDE -12%; downgraded to Underperform at Wolfe research with $1 price tgt saying the electric F-150 reinforces our view that RIDE will not be competitive in the commercial EV pickup space


·     DoorDash (DASH) 8M share Block Trade priced at $133.25

·     Lithia Motors (LAD) 3.11M share Secondary priced at $322.00

·     Oatly Group (OTLY) 84.376M share IPO priced at $17.00 per ADS

·     Procore (PCOR) 9.47M share IPO priced at $67.00

·     Seelos Therapeutics (SEEL) 19.35M share Spot Secondary priced at $3.10

·     Sun Country Airlines (SNCY) 7.25M share Secondary priced at $34.50

·     Trean Insurance (TIG) 5M share Secondary priced at $14.00

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Market commentary provided by Hammerstone Markets, Inc, a firm separate from and not affiliated with Regal Securities. Regal Securities has not participated in the creation of the content, and does not explicitly or implicitly endorse the content.