Early Look

Wednesday, April 24, 2024

U.S. futures looking flat to higher, as Nasdaq futures outperform behind a jump in TSLA shares (+11%) following earnings/results and commentary, while the S&P and Dow futures are looking flat. Tesla reported Q1 EPS, revs, deliveries, margins all below consensus, but the bar was low, and the company made upbeat comments about a low-cost model launch that lifted shares. Yesterday, the S&P 500 rose 1.2% in its biggest one-day percentage gain since late February, while the Nasdaq composite added 1.6% after encouraging economic data and some positive surprises from earnings reports. Nearly all eleven S&P sectors finished sharply higher on Tuesday, outside of weakness in the Materials sector, paced by gains in Technology, Industrials, and Healthcare. In Asian markets, The Nikkei Index surged over 900 points or 2.4% to 38,460, the Shanghai Index rose 22 points to 3,044, and the Hang Seng Index rallied 372 points to 17,201. In Europe, the German DAX is up 54 points to 18,192, while the FTSE 100 is up 40 points to 8,085. Another flurry of earnings out this morning (details of many below) and a long list again tonight headlines by META. No Fed speakers ahead of next week FOMC meeting and on calendar only Durable Goods orders and a record $66B 5-year Treasury note auction at 1:00 PM.

• The Dow Jones Industrial Average rose 263.71 points, or 0.69%, to 38,503.69.
• The Nasdaq Composite jumped 245.34 points, or 1.59%, to 15,696.64.
• The Russell 2000 Index advanced 35.17 points, or 1.79% to 2,002.64.

• 8:30 AM Et                   Durable Goods Orders for March
• 10:30 AM ET                Weekly DOE Inventory Data
• 1:00 PM ET                   US Treasury to sell $67B in 5-year notes.

Earnings Calendar:

• Earnings Before the Open: APH AVY BA BG BIIB BLFY BOKF BSX BXMT CME COOP ETR EVR FTV GD GPI HAS HELE HLT HUM IPG LAD LII MAS MHO NAVI NSC OC ODFL OTIS PB PRG SFNC SLAB SYF T TDY TEL TMO TNL UCBI VIRT VRT WAB WNC WSO
• Earnings After the Close: ALGN AM AMSF AR ASGN ATNI BMRN BRWL CACI CASH CCS CHDN CHE CHX CLB CMG CNMD CVLG CYH EGBN EHC ESRT ETD F FAF FIBK GGG GSHD HBNC HLX HP IBM INBK KAKK KALU KNX LOB LRCX LSTR MC META MOH MORN MTH MXL NBR NLY NOW OII ORLY PEGA PFSI PI PLXS PMT QS RBBN RJF ROL SEIC SLM SNBR STC TER TYL UHS URI VKTX WH WHR WM WU

• The Senate voted overwhelmingly on Tuesday night to give final approval to a $95.3 billion package of aid to Ukraine, Israel, and Taiwan, sending it to President Biden.
• The Senate voted to send a foreign aid package that includes sanctions on Iran’s oil sector to President Joe Biden, who has said he will sign the legislation into law.

• Hasbro (HAS) Q1 EPS $0.42 vs. est. $0.27; Q1 revs $757.3M vs. est. $738.61M; backs FY24 adjusted EBITDA view $925M-$1B and sees FY24 gross savings $750M.
• Hilton (HLT) Q1 adj EPS $1.53 vs. est. $1.42; Q1 revs $2.57B vs. est. $2.55B; Q1 system-wide comparable RevPAR increased 2%; sees Q2 adjusted EPS $1.80-$1.88 vs. est. $1.88; sees Q2 adjusted EBITDA $890M-$910M and sees Q2 system-wide comparable RevPAR up 2%-4%.
• Mattel Inc. (MAT) Q1 adj EPS ($0.05) vs est. ($0.12), adj EBITDA $54Mm vs est. $32.2Mm on sales $809.5Mm vs est. $831.8M; guides FY sales flattish y/y vs est. -0.23%, adj gr mgn 48.5-49%, adj EPS $1.35-1.45 vs est. $1.39
• Hawaiian Holdings (HA) Q1 adj EPS loss (-$2.77) vs est. (-$2.74), adj EBITDA ($116Mm) vs est. ($116Mm); sees Q2 ASMS +3.5-6.5% and FY ASMS +4.5-7.5%, sees Q2 operating RASM -1.5% to +1.5%; lowers FY24 ASMs view to 4.5%-7.5% from 6.0%-9.0%; raises FY24 operating revenue per ASM view to up 4.1%-6.3% from up 0.7%-3.0%.
• Stride (LRN) Q3 EPS $1.60 vs. est. $1.43; Q3 revs $520.84M vs. est. $507.18M; narrows FY24 revenue view to $2.03B-$2.04B from $1.99B-$2.04B (est. $2.02B), while boosts FY24 adj operating income view to $2980M-$290M from $265M-$285M; sees FY24 capital expenditures $60M-$65M.

• Enphase (ENPH) Q1 adj EPS $0.35 vs est. $0.40 on revs $263.3Mm vs est. $279.78Mm, adj gr mgn 46.2%; guides Q2 revs $290-330Mm vs est. $348.64Mm, adj gr mgn 44-47%, adj op exp $78-82Mm; said the -63.7% YoY decline in revenue for Q1 24 was the result of seasonality & a further softening in US demand; forecasts Q1 as bottom of market.
• EQT Corp. (EQT) Q1 adj EPS $0.82 vs. est. $0.64; Q1 adj net income $365M vs. est. $263.8M; Q1 revs $1.41B; Q1 Total sales volume of 534 Bcfe, towards the high-end of guidance adjusted for curtailments.
• Matador Resources (MTDR) Q1 adj EPS $1.71 vs. est. $1.50; Q1 average production of 149,760 BOE per day; Q1 adjusted net income $206.2M vs. est. $181.4M and Ebitda $505.4M vs. est. $477.9M; anticipates achieving high end of 2024 production guidance.
• Range Resources (RRC) Q1 EPS $0.69 vs. est. $0.57; Q1 revs $645.37M vs. est. $659.31M; Q1 production averaged 2.14 Bcfe per day, approximately 68% natural gas; targeting a maintenance production program in 2024, resulting in approximately flat production at 2.12 – 2.16 bcfe per day.
• Weatherford International (WFRD) Q1 EPS $1.50 vs. est. $1.44 while revs rise 15% y/y to $1.36B vs. est. $1.32B; Q1 operating income $233M, +26% y/y, and adj EBITDA $336M, +25% y/y; says full year adjusted EBITDA margin is now expected to hit 25% in 2024 versus 2025, while reaffirming our previous revenue guidance.

• Artisan Partners (APAM) Q1 adj NI $61.6Mm vs est. $60.7Mm on revs $264.4Mm vs est. $270.9Mm, adj op mgn 30.9%; AUM $154.2B.
• Chubb Inc. (CB) Q1 EPS $5.41 vs. est. $5.30 with Q1 consolidated net premiums written of $12.2B, up 14.1%, with P&C up 12.4% and life insurance up 26.3%; Q1 net premiums earned $11.58B, +14% y/y, and book value per share $149.09 vs. $127.94 y/y; Property & casualty combined ratio 86% vs. 86.3% y/y and loss, loss expense ratio 58.1% vs. 58.9% y/y.
• CoStar Group (CSGP) Q1 EPS $0.02 vs est. $0.07 on revs $656Mm vs est. $653.33Mm; guides Q2 revs $674-679Mm vs est. $682.23Mm and adj EPS $0.09-0.10 vs est. $0.09; sees FY adj EBITDA $185-205Mm vs est. $182.61Mm and adj EPS $0.58-0.62 vs est. $0.60.
• Enova International (ENVA) Q1 adj EPS $1.91 vs est. $1.72, adj EBITDA $149Mm vs est. $138.7Mm on revs $609.889Mm vs est. $584.42Mm.
• Marsh McLennan Agency, a subsidiary of Marsh (MMC), announced that it has entered into a definitive agreement to acquire Fisher Brown Bottrell Insurance, Inc. from Trustmark National Bank for $315.9M.
• Synchrony Financial (SYF) posted a surge in profit, boosted in part by higher interest and fees on loans; Q1 adj EPS $1.18 missed the $.134 estimate; Q1 net interest income (NII) rose 8.7% to $4.41 billion from $4.05 billion but below ests $4.45B; said interest and fees on loans increased 15% to $5.3 billion, primarily by growth in average loan receivables, lower payment rate and higher benchmark rates; provision for credit losses at the end of the quarter totaled $1.88B compared to $1.29B y/y; board approved an incremental share repurchase program of up to $1 billion.
• Virtu Financial (VIRT) authorizes additional $500M share repurchase plan; announces planned CFO transition after Q1 EPS $0.76 tops $0.55 estimate.

• Humana (HUM) said that considering the significant difference between the final rate notice and its previous funding assumption, combined with the inherent pricing limitations imposed by the Total Beneficiary Cost change thresholds, the company no longer believes $6-$10 of adjusted EPS growth is the appropriate target range for 2025.
• Thermo Fisher (TMO) Q1 adj EPS $5.11 vs. est. $4.71; Q1 revs $10.34B vs. est. $10.17B; raises FY24 adjusted EPS view to $21.14-$22.02 from $20.95-$22.00 (est. $21.53) and raises FY24 revenue view to $42.3B-$43.3B from $42.1B-$43.3B (vs. est. $42.83B).

• Steel Dynamics (STLD) Q1 EPS $3.67 vs est. $3.51, adj EBITDA $879Mm vs est. $861.6Mm on revs $4.694B vs est. $4.736B; says confident market conditions in place for domestic steel consumption to be strong thru 2024.
• Veralto (VLTO) Q1 EPS $0.84 vs. est. $0.76; Q1 revs $1.246B vs. est. $1.23B; guides Q2 EPS $0.75-$0.80 vs. est. $0.80; sees Q2 non-Gaap core sales growth in low-single digits with adj operating profit margin of about 23%; sees FY adj adjusted operating profit margin will expand 50 to 75 basis points y/y.

• Texas Instruments (TXN) Q1 EPS $1.20 vs est. $1.07 on revs $3.66B vs est. $3.611B; sees Q2 revs $3.65-3.95B vs est. $3.765B and EPS $1.05-1.25 vs est. $1.16.
• Seagate Technologies (STX) Q3 adj EPS $0.33 vs. est. $0.29; Q3 revs fell -11% y/y to $1.655B, in-line with estimates; Q3 adj gross margin 26.1% vs. 18.7% y/y and adj operating margin 11.1% vs. 3.5% y/y; guides Q4 adj EPS $0.50-$0.90 vs. est. $0.60 and Q3 revs $1.7B-$2.0B vs. est. $1.84B.
• Vertiv Holdings (VRT) shares +16%; as reports Q1 adj EPS $0.43 vs. est. $0.36; Q1 revs $1.64B vs. est. $1.62B; sees FY24 adjusted EPS $2.29-$2.35 vs. est. $2.30 and sees FY24 revenue $7.54B-$7.69B vs. est. $7.63B; sees FY24 adjusted operating profit $1.33B-$1.38B and guides FY adj operating margin 17.5%-17.9%.
• Vicor Corp. (VICR) Q1 EPS $0.06 vs est. $0.06 GAAP on revs $83.9Mm vs est. $84.83Mm, gr mgn 53.8%.
• SK Hynix said it plans to invest an additional $14.6 billion to expand its semiconductor production capacity in South Korea to meet growing demand for artificial-intelligence chips.