Early Look

Tuesday, January 26, 2021

Futures	Up/Down	%	Last
Dow	28.00	0.09%	30,896
S&P 500	-2.25	0.07%	3,845
Nasdaq	-28.50	0.21%	13,447

 

 

Stocks are looking at a mixed open, with Dow futures edging slightly higher after a few earnings results (JNJ, MMM), while Nasdaq futures pull back slightly after touching record highs the day prior ahead of a busy week of earnings (111 of the S&P 500 companies report this week). In Asian markets, The Nikkei Index fell -276 points to 28,546, the Shanghai Index declined -54 points to 3,69 and the Hang Seng Index plunged -767 points to 29,391. In Europe, the German DAX is higher by nearly 200 points to 13,840, while the FTSE 100 is up around 40 points to 6,680. Stocks closed mixed on Monday as the S&P 500 index managed a small gain while the Nasdaq Composite rallied for a 5^th straight day, led by gains in Apple (AAPL) ahead of earnings this week, with markets getting a boost from a late day bump as the broader market closed near the highs of the day. The Dow Jones Industrials slipped amid weakness in financials (AXP, GS), while other cyclical sectors saw weakness after leading markets higher to start the year and defensive utilities paced the gains. Treasury markets advanced along with a bounce in the dollar and oil prices. Earnings tonight from AMD, MXIM, COF, SBUX.

 

Market Closing Prices Yesterday

·     The S&P 500 Index climbed 13.89 points, or 0.36%, to 3,855.36

·     The Dow Jones Industrial Average fell -36.98 points, or 0.12%, to 30,960.00

·     The Nasdaq Composite gained 92.93 points, or 0.69%, to 13,635.99

·     The Russell 2000 Index declined -5.49 points, or 0.25% to 2,163.27

 

Events Calendar for Today

·     7:45 AM ET         ICSC Weekly Retail Sales

·     8:55 AM ET         Johnson/Redbook Weekly Sales

·     9:00 AM EST      CaseShiller 20 City Home Index for November

·     10:00 AM EST    Consumer Confidence for January…est. 89.0

·     10:00 AM EST    Richmond Fed Index for January…prior 19

·     4:30 PM ET         API Weekly Inventory Data

 

Earnings Calendar:

·     Earnings Before the Open: ADM, ALK, AXP, CAC, CIT, DHI, FCX, GATX, GE, IVZ, JNJ, LMT, MMM, NEE, NEP, PCAR, PEBO, PII, PLD, ROK, RTX, SNV, VZ, XRX

·     Earnings After the Close: AGYS, AMD, BXP, CHRW, COF, EHC, FCF, FFIV, FMBI, HA, HOPE, KTCC, LRN, MSFT, MXIM, NAVI, PFC, SBUX, SLGN, TRMK, TXN, UMBF, VAR, VBTX, WRB

 

 

Macro	Up/Down	Last
Nymex	0.39	53.16
Brent	0.37	56.25
Gold	-4.95	1,851.00
EUR/USD	-0.0002	1.2137
JPY/USD	0.03	103.78
10-Year Note	+0.017	1.05%

 

 

Sector News Breakdown

Consumer

·     D.R. Horton (DHI) Q1 EPS $2.14 vs. est. $1.69; Q1 revenue $5.9B vs. est. $5.54B; Q1 sales orders rose 56% to 20,418 homes and 62% in value to $6.4 billion compared to 13,126 homes and $3.9 billion in the same quarter of the prior year; sales order backlog of homes increased 107% to 28,487 homes; raises FY21 revenue view to $25.2B-$25.8B from $24B-$25B

·     Polaris (PII) Q4 adj EPS $3.34 vs. est. $2.90; Q4 revenue $2.16B vs. est. $2.11B; Q4 gross profit margin 25.5%, up 112 bps; sees FY21 adjusted EPS $8.45-$8.75 vs. est. $7.80 and FY21 revenue $7.95B-$8.15B vs. est. $7.4B

·     Academy Sports (ASO) announces offering of 12M shares of common stock for holders

·     Boot Barn (BOOT) 3Q EPS $1.00 vs. est. $1.00 on sales $302.3Mm vs. est. $303.3Mm, says comps +4.6%; not providing 4Q or FY guidance at this time

·     Caesars Entertainment, Inc. (CZR) announced a strategic investment in the daily fantasy sports platform SuperDraft, Inc.

·     Inter Parfums (IPAR) Q4 sales $184M vs. est. $148M; Q4 comp store sales rose 3.5%; raises FY20 EPS view to $1.15-$1.20 from 80c-84c (est. 84c) and backs year sales $610M-$625M vs. est. $627M

·     J & J Snack Foods (JJSF) 1Q EPS $0.09 vs. est. $0.18 on sales $241Mm vs. est. $228.5Mm, anticipates virus will continue to have negative impact in short term

 

Energy

·     Southern California Edison will pay $2.2 billion to settle insurance claims from a deadly, destructive wildfire sparked by its equipment in 2018, the utility announced. Edison, which acknowledged no wrongdoing, said the agreement covers all claims in pending lawsuits from insurance companies related to the Woolsey fire, which blackened 151 square miles of Los Angeles and Ventura counties.

 

Financials

·     Brown & Brown (BRO) Q4 adj EPS 32c vs. est. 29c; Q4 revenue $642.1M vs. est. $623.34M

·     Bridge Bancorp Inc. (BDGE) will replace Dime Community Bancshares Inc. (DCOM) in the S&P SmallCap 600 effective prior to the opening of trading on Monday, February 1.

·     Enterprise Financial (EFSC) 4Q EPS $1.00 vs. est. $0.69 on revs $47.5Mm vs. est. $82Mm; Q4 net interest margin 3.66% vs. 3.68% last year and Q4 provision for loan losses $9.46M vs. $1.34M last year

·     Everest (RE) is estimating pre-tax net catastrophe losses for the fourth quarter 2020 of $70 million, net of reinsurance and reinstatement premiums; also estimating pre-tax net Covid-19 Pandemic losses for Q4 of $76 million primarily for third-party lines; expects to report FY20 net income of $475-$525M and operating income of $275-$325M

·     Heartland Financial (HTLF) Q4 PS $0.98 vs. est. $1.02; raises dividend 10% to $0.22; Q4 Net interest margin of 3.51%, fully tax-equivalent (non-GAAP) of 3.55%; efficiency ratio (non-GAAP) 54.93% and 56.65% for the year

·     ServisFirst (SFBS) Q4 EPS 94c vs. est. 81c; Q4 tangible book value per share $18.15 and Q4 CET1 capital ratio 10.52%

·     UBS Q4 Net profit more than doubled to $1.71 billion from $722 million a year earlier vs. est. profit of $966 million; Q4 operating income rose 15% to $8.12 billion, beating analysts’ forecast of $7.37 billion; Quarterly charges for credit losses of $66 million also beat expectations of $160 million; said it plans to launch a new three-year buyback program of up to 4 billion Swiss francs ($4.5 billion) in the first quarter

 

Healthcare

·     Johnson & Johnsons (JNJ) 4Q adj EPS $1.86 vs. est. $1.82 on sales $22.5B vs. est. $21.7B; guides FY21 adj sales +8.8% and adj EPS +16.4% vs est +8.8% and +12.4%, respectively; says continue to progress Covid vaccine candidate and look forward to sharing details on phase 3 study soon

·     Lipocine (LPCN) announces common stock offering

·     Seer Inc. (SEER) 1.4 mln shares being offered for sale by co & 2.1 mln shares being offered for sale by selling stockholders

·     Surgery Partners (SGRY) announces offering of 6M shares of common stock

·     Staar Surgical Co. (STAA) will replace Prestige Consumer Healthcare Inc. (PBH) in the S&P MidCap 400, and Prestige Consumer Healthcare will replace Foundation Building Materials Inc. (FBM) in the S&P SmallCap 600 effective prior to the opening of trading on Friday, January 29.

 

Industrials & Materials

·     General Electric (GE) Q4 adj EPS 8c on revs $21.93B vs. est. 9c and $21.83B; Q4 total orders were down 7% YoY to $23.2B, organic orders fell -3%; power orders were up 26% to $5.6B; Q4 aviation orders down -41% to $6.3B; said significantly improved profitability, cash performance as 2020 progressed

·     3M Corp. (MMM) Q4 adjusted EPS $2.38 vs. est. $2.15; Q4 revenue $8.58B vs. est. $8.4B; operating cash flow was $2.5B with adjusted free cash flow of $2.1B; sees FY21 EPS $9.20-$9.70 vs. est. $9.52 and sees FY21 revenue up 5%-8% (est. $33.91B)

·     Covenant Logistics (CVLG) 4Q adj EPS $0.13 vs. est. $0.61 on revs $225.2Mm vs. est. $230.6Mm; says board approved new $40Mm stock repurchase authorization

·     Crane (CR) Q4 EPS $1.00 vs. est. $1.10; Q4 revenue $726.4M vs. consensus $737.92M; sees FY21 revenue about $3.05B below consensus $3.13B; sees FY21 core sales growth of approximately 2% and sees FY21 free cash flow of $260M-$290M vs. $275M in FY20

·     Graco (GGG) Q4 adj EPS 61c vs. est. 51c and sales $470.3M vs. est. $427.4M; Sales increased by 14% in the quarter, led by double-digit sales growth in the Contractor segment and Asia Pacific region; gross profit margin rate for Q4 increased due to strong realized pricing, improved sales volume in the Industrial segment and favorable effects of changes in currency translation rates

·     HB Fuller (FUL) 4Q adj EPS $1.06 vs. est. $0.85 on revs $778Mm vs. est. $734.3Mm, says full year debt paydown of $205Mm surpassed $200Mm target; says base case outlook for low to mid-single digit organic revs growth and about 10% adj EBITDA growth for FY21; says to pay down additional $200Mm debt in FY21

·     Hexcel Corp. (HXL) Q4 adj EPS loss (18c), in-line with estimates on sales $295.8M vs. est. $298.87M; to withhold year guidance citing market uncertainties

·     Steel Dynamics (STLD) Q4 adj EPS $0.97 vs. est. $0.83 and sales $2.6B vs. est. $2.53B; says expect to see continued steel price strength and strong customer demand in 2021

·     Sino-Global Shipping America ltd (SINO) files for resale of up to 1.17 mln shares of common stock by the selling stockholders – sec filing

·     Yamana Gold (AUY) said Q4 gold equivalent ounce (production of 255,361 GEO, including 221,659 ounces of gold and 2.59 million ounces of silver, with production during the quarter exceeding sales by over 7,000 ounces of gold due to timing of sales which is expected to normalize during 2021.

 

Technology, Media & Telecom

·     BlackBerry (BB) shares up 16%; announced an expansion of its strategic partnership with Baidu (BIDU), whose high-definition maps will run on the QNX Neutrino real-time operating system and will be mass-produced in the forthcoming GAC New Energy Aion models from the EV arm of GAC Group (Guangzhou Automobile Group Co., Ltd.).

·     Xerox (XRX) Q4 adj EPS 58c vs. est. 60c; Q4 revs $1.93B vs. est. $1.9B; sees 2021 operating cash flow from continuing operations of at least $600 mln and free cash flow of at least $500M; plans to create separate software, financing and innovation businesses, launch corporate venture capital fund; sees 2021 revenue of at least $7.2 bln in constant currency or approximately 2.5% growth

·     Baozun (BZUN) signs an agreement with iClick, an independent online marketing and enterprise data solutions provider in China.

·     Veoneer (VNE) and Qualcomm (QCOM) will collaborate to provide scalable Advanced Driver Assistance Systems (ADAS), Collaborative and Autonomous Driving (AD) solutions. The companies first communicated their plans to team up on August 27, 2020

·     Qumu (QUMU) announces $20M common stock offering