Morning Preview: March 07, 2023

Early Look

Tuesday, March 7, 2023









S&P 500










U.S. futures are pointing to a slightly higher open though caution persists ahead of the Federal Reserve Chair Jerome Powell’s Congressional testimony at 10:00 AM this morning to the Senate Banking Committee. Investors also await Friday’s jobs report to see if the labor market is starting to cool down. The Dow rose slightly Monday, as Wall Street fought to hold onto last week’s gains and investors braced for a busy week of economic news, though Smallcaps lagged with the Russell falling over -1.4% and the tech heavy Nasdaq edged into negative territory late. Inflation concerns overseas edged lower as Australia’s RBA raised rates by 25 bps but acknowledged that “the monthly CPI indicator suggests that inflation has peaked in Australia”, while in Europe, the ECB inflation report stated that consumer expectations for Euro-zone inflation receded “significantly.” Chairman Powell’s semi-annual Congressional testimony begins with the Senate Tuesday, the House on Wednesday – text of testimony potentially released before the appearance. Following recent strength in US data flow, higher inflation prints and ongoing hawkishness from Fed speakers, the question is whether the Chairman and the upcoming data will validate higher expectations on the size and pace of tightening. Markets currently are pricing 32 bps of tightening for the March meeting and a terminal Fed Funds rate of 5.45%. In Asian markets, The Nikkei Index rose 71 points to 28,309, the Shanghai Index fell -36 points to 3,285, and the Hang Seng Index slipped -68 points t 20,534. In Europe, the German DAX is up 23 points to 15,677, while the FTSE 100 is up 19 points to 7,949.


Market Closing Prices Yesterday

·     The S&P 500 Index gained 2.78 points, or 0.07%, to 4,048.42.

·     The Dow Jones Industrial Average rose 40.47 points, or 0.12%, to 33,431.44.

·     The Nasdaq Composite slipped -13.27 points, or 0.11%, to 11,675.74.

·     The Russell 2000 Index declined -28.51 points, or 1.48% to 1,899.76.


Economic Calendar for Today

·     7:45 AM ET            ICSC Weekly Retail Sales

·     8:55 AM ET            Johnson/Redbook Weekly Sales

·     10:00 AM ET          Wholesale Inventories M/M for January

·     10:00 AM ET          Senate Banking Panel Hears Semi-Annual Monetary Policy Report

·     1:00 PM ET             U.S. Treasury to sell $40B in 3-year notes.

·     3:00 PM ET             Consumer Credit for January

·     4:30 PM ET             API Weekly Inventory Data


Earnings Calendar:




Other Key Events:

·     Cowen Healthcare Conference, 3/6-3/8, in Boston, MA

·     JPMorgan Global Emerging Markets Corporate Conference, 3/6-3/8, in Miami, FL

·     JPMorgan Global High Yield and Leveraged Finance Conference, 3/6-3/8, in Miami, FL

·     Optical Fiber Communications Conference, 3/7-3/9, in San Diego, CA

·     Truist Technology, Internet & Services Conference, 3/7-3/8, in New York





















10-Year Note





World News

·     Despite delivering the expected 25bps hike the RBA toned down the hawkish sentiment and yields fell. The RBA did say that more rate increases are still on the cards but acknowledged that “the monthly CPI indicator suggests that inflation has peaked in Australia.”

·     The ECB inflation report stated that consumer expectations for Euro-zone inflation receded “significantly.” Expectations for three years ahead dropped to 2.5% in January from 3% in December, while the next 12 months fell from 5.0% to 4.9%.

·     German Factory Orders MoM for January came in better than expected at +1.0% vs the consensus forecast of -0.7%. Capital goods held up well, but a further tightening of financial conditions is worrying some who see danger ahead,


Sector News Breakdown


·     Calavo Growers (CVGW) 1Q adj EPS ($0.08) vs est. $0.24 on revs $226.2Mm vs est. $270.6Mm; sees FY23 grown segment gr mgn per case at/near low end of $3-4 Target range; sees FY23 prepared segment gr mgn in fresh cut division at/near low end of 10-12% range, gr mgn in guacamole division approx 20%.

·     Dole PLC (DOLE) said Q4 revs revenue rose to $2.36B from $2.25B y/y and above ests $2.27B as higher prices on everything lifted results; Q4 adj EPS $0.09 vs. est. $0.06; volume of bananas sold fell while the pineapple sales volume rose in core markets.

·     Rivian (RIVN) shares slip on plans to sell bonds worth $1.3 bln; said initial investors will get an option to buy an additional $200 mln of bonds for settlement 13 days after the bonds are issued.

·     ThredUp (TDUP) Q4 EPS loss (-$0.19) vs. est. loss (-$0.20); Q4 revs $71.3M vs. est. $63M; guides Q1 adj Ebitda loss margins (-12%-10%) and revs $71M-$73M vs. est. 69.6M; sees FY23 revs $310<-$320M vs. est. $301.7M and adj Ebitda loss margin (8%-6%); Active Buyers of 1.7 million and Orders of 1.5 million in Q4 2022, representing y/y declines of 2% and 8%, respectively.

·     WW International (WW) Q4 EPS loss (-$0.46) vs. est. 0c; Q4 revs $223.9M vs. est. $224.5M; sees Q1 revs about $235M vs. est. $244M; reported end of period subscribers of 3.5M; said Q4 Operating Loss of $50.8M primarily due to $57.6M in non-cash intangible impairment charges.


Energy, Industrials and Materials

·     AerSale Corp. (ASLE4Q adj EPS $0.23 vs est. $0.21 on revs $95.1Mm vs est. $122.7Mm; guides FY23 revs $460-490Mm vs est. $495.8Mm and adj EBITDA $70-80Mm vs est. $99.6Mm.

·     AeroVironment (AVAV) Q3 adj EPS $0.33 vs. est. $0.41; Q3 revs rose 49% y/y to $134.4M vs. est. $125.6M; raises low end of year revs view to $510M-$525M from $505M-$525M; cuts FY23 EPS view to $1.13-$1.33 from $1.26-$1.58 (est. $1.39).

·     Intrepid Potash (IPI) Q4 adj EPS $0.83 on sales $66.7M; for 2023, cap budget guidance range is $60M-$75M and for Q1, says have seen strong demand for our potash and trio.



·     Keycorp (KEY) sees 2023 net interest income up 1%-4%, saw up 6%-9%; Sees FY23 noninterest income down 1%-3% and sees FY23 GAAP tax rate 19%-20%.

·     Goldman Sachs BDC (GSBD) 6.5M share Spot Secondary priced at $15.25.

·     Late Monday, Bloomberg reported Intercontinental (ICE)/Black Knight (BKI) deal to be challenged by FTC suit as soon as Thursday.



·     Anika Therapeutics (ANIK) 4Q adj EPS ($0.21) vs est. ($0.24) on revs $39.6Mm vs est. $37.7Mm; sees FY revs $158-163Mm vs est. $168.4Mm.

·     Cara Therapeutics (CARA) 4Q ($0.56) vs est. ($0.32) on revs 3.26Mm vs est. $16.3Mm; says current unrestricted cash and equivalents and available-for-sale marketable securities will be sufficient to fun operating plan into at least 1H24.

·     Coherus BioSciences (CHRS) 4Q adj ESP ($0.60) vs est. ($0.84) on revs $45.4Mm vs est. $51.2Mm; says expect revenue growth and expense control to enable a return to profitability in 2024.

·     Orthofix (OFIX) 4Q EPS GAAP ($0.35) vs est. ($0.06) on revs $122.2Mm vs est. $121.8Mm; guides combined company 1Q revs $166-170Mm vs est. $111.3Mm and FY revs $743-753Mm vs est. $480Mm (may not be comparable).


Technology, Media & Telecom

·     BlackBerry Inc (BB) guides prelim 2023 revenue of $656M vs. est. of $674.7M and sees prelim Q4 revs $151M vs. est. $168.5M; said macro challenges were a key factor for BlackBerry’s Cybersecurity business unit this quarter, with elongated sales cycles in government causing some large deals to slip into later quarters.

·     Domo Inc. (DOMO) 4Q adj EPS ($0.02) vs est. ($0.09) on revs $79.6Mm vs est. $77.5Mm, subscription revs $70.3Mm +18%; guides 1Q revs $78.5-79.5Mm vs est. $79.5Mm, adj EPS ($0.19)-($0.15) vs est. ($0.12); sees FY revs $323-330Mm vs est. $337.1Mm and adj EPS ($0.39)-($0.27) vs est. ($0.49).

·     Guidewire Software (GWRE) Q2 adj EPS loss (-$0.21) vs. est. loss (-$0.03); Q2 revs $232.6M vs. est. $223.2M; sees Q3 revenue $211M-$216M vs. est. $213.7M and boosts FY23 revenue view to $894M-$904M from $886M-$896M (est. $890.66M); Q2 annual recurring revenue, or ARR, was $707 million, compared to $664 million as of July 31, 2022.

·     Meta (META) is planning a fresh round of layoffs that could begin as early as this week. Bloomberg said the reductions will add to the 11,000 job cuts unveiled by Meta late last year as part of a major effort on cost controls and “flattening” management structures from CEO Mark Zuckerberg.

·     Nutanix (NTNX) Q2 prelim revs $486.5M vs. est. $465M; sees Q3 revs $430M-$440M vs. est. $425M and ACV billings $220M-$225m: raises fiscal year 2023 revenue and ACV billings guidance to $1.8B-$1.81B and $905M-$915M.

·     Sea Ltd (SE) Q4 2022 Total GAAP revenue $3.5B up 7.1% YoY; total adjusted EBITDA turned positive to $495.7 million, as compared to $(492.1) million for the fourth quarter of 2021; FY 2022 Total GAAP revenue US$12.4B up 25.1% YoY.

·     Squarespace (SQSP) Q4 EPS loss ($1.72) on revenue $228.81M vs. est. $222.11M; Q4 Total bookings grew 15% y/y to $232.1M; guides Q1 revs $232M-$234M vs. est. $227.3M and FY23 revs $955M-$970M vs. est. $949.4M.

·     Atlassian (TEAM) cuts 500 full-time employees, or about 5%; sees about $70M to $75M in charge.

·     A bipartisan Senate bill to give the President the authority to respond to threats posed by TikTok and companies like it will be unveiled Tuesday, CNBC reported last night.


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.