Early Look

Tuesday, November 8, 2022

Futures	Up/Down	%	Last
Dow	107.00	0.33%	32,945
S&P 500	13.25	0.36%	3,829
Nasdaq	70.50	0.64%	11,085

 

 

U.S. stock futures higher ahead of Tuesday’s midterm elections and Thursday’s inflation report, holding yesterday’s gains despite Treasury yields staying elevated (10-yr 4.2% and 2-yr 4.71%), while commodity and crypto prices slip. China’s COVID woes remain a concern with daily new cases in China rising to a six-month high for Sunday. Earnings season finally begins to slow, with more than 430 of the S&P 500 having reported this quarter, but Dow component and media conglomerate Disney (DIS) expected to report this evening. In Asian markets, The Nikkei Index gained 344 points to 27,872, the Shanghai Index fell -13 points to 3,064, and the Hang Seng Index slipped -38 points to 16,557. In Europe, the German DAX is up 55 points to 13,590, while the FTSE 100 is flat just below 7,300. The National Federation of Independent Business overall optimism index fell to 91.3 last month from 92.1, the group said in a report as seven of the gauge’s 10 components decreased. Today feels like a big waiting game ahead of voting today for control of the Senate (unclear) and House (expected to flip to Republican) and then the consumer price index (CPI) report on Thursday.

Market Closing Prices Yesterday

·     The S&P 500 Index spiked 36.25 points, or 0.96%, to 3,806.80

·     The Dow Jones Industrial Average rose 423.78 points, or 1.31%, to 32,827.00

·     The Nasdaq Composite gained 89.27 points, or 0.85%, to 10,564.52

·     The Russell 2000 Index advanced 9.94 points, or 0.55% to 1,809.81

 

Economic Calendar for Today

·     6:00 AM ET            NFIB Small Business Optimism for Oct

·     7:45 AM ET            ICSC Weekly Retail Sales

·     8:55 AM ET            Johnson/Redbook Weekly Sales

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

·     4:30 PM ET            API Weekly Inventory Data

 

Earnings Calendar:

·     Earnings Before the Open: ADTN AGEN AMRK AXGN BLDR BSY BWEN CCO CG COTY CTG DBD DD ELAN EVBG EVRI EXPD FULC GFS HAIN LITE IGT LQDA MPLN MRNS NCLH NXST PKI PEI PLNT PRTY RCM RETA REYN RIDE RYTM SAGE SEAT SGRY SHO SKIN SPWR SQSP SSP SUNW TGI TSHA VYGR WKHS XXII

·     Earnings After the Close: AFRM AKAM ALRM AMBC AMC ANGI ANIK APEI ARRY ATRA AVID AXON BIRD BLNK BW CARG CHRS CTMX CTRE DAR DDD DIS DOX DV ENV FLYW FTEK FTK GDRX GEVO GMED GO GXO HALO HCI HRTG IAC INO JKHY KODK LAND LCID LMND LVOX MARA MASI MODN MRTX NEWR NLOK NOG NTRA NVAX NWSA OM OSCR OSUR OXY PLUG PRA PUBM REAL RVNC SFM SFT SG SILK SNCR SUPN TMCI TWO UPST VLDR VSAT XPER ZD ZYME

 

 

Macro	Up/Down	Last
Nymex	-0.95	90.84
Brent	-0.72	97.20
Gold	-5.40	1,675.10
EUR/USD	-0.0002	1.000
JPY/USD	-0.25	146.38
10-Year Note	-0.013	4.201%

 

 

Sector News Breakdown

Consumer

·     Lyft (LYFT) Q3 EPS loss ($1.18) Q3 revs $1.05B vs. est. $1.06B; Q3 revenue per active rider was $51.88, up 13.7%; sees Q4 revenue $1.145B-$1.165B below consensus $1.17B and sees Q4 revenue growth to be between 9-11% q/q and 18-20% y/y

·     Tesla (TSLA) recalls 40,000 U.S. Vehicles over potential loss of power steering assist. NHTSA, in a letter dated Nov 7, acknowledges Tesla’s notification to NHTSA of safety recall of 40,168 units of Model S/2017-2021, Model X/2017-2021

·     International Flavors (IFF) Q3 adj EPS $1.36 vs. est. $1.20; Q3 revs $3.06B vs. est. $3.03B; cuts FY22 revenue view to $12.4B-$12.5B from $12.6B-$13B (est. $12.66B); sees FY22 adj operating EBITDA to be in line and at the low-end of the Company’s previous $2.5B-$2.6B range

·     TripAdvisor (TRIP) Q3 adj EPS $0.28 vs. est. $0.38; Q3 revs $459M vs. est. $441.86M; sees Q4 revenue of low-single digit increases from 2019 levels

·     Vroom Inc. (VRM) 3Q adj EPS ($0.64) vs est. $0.62) on revs $340.8Mm vs est. $466.6Mm, adj EBITDA ($73.3Mm) vs est. ($63.1Mm); ecommerce gr profit per unit $4,206 +16%

·     AppHarvest (APPH) 3Q EPS ($0.23) vs est. ($0.31); revises FY sales guide lower to range of $14.0-17.0Mm vs est. $21.3Mm

·     Adidas (ADDYY) CEO to step down on Friday; appoints PUMA’s Gulden as CEO

 

Energy

·     Diamondback Energy (FANG) Q3 EPS $6.48 vs. est. $6.33; Oil volumes for the quarter decreased to 224.3 thousand barrels of oil per day (BO/d), down from 239.8 thousand BO/d last year; average unhedged realized price for oil, however, rose to $89.79 per barrel in the reported quarter, up from last year’s $68.27 per barrel.

·     SolarEdge (SEDG) Q3 adj EPS $0.91 vs. est. $1.44; Q3 revs $836.7M vs. est. $822.37M; sees Q4 revenue $855M-$885M vs. est. $856.78M; sees Q4 non-GAAP gross margin expected to be within the range of 27% to 30%

 

Financials

·     Crypto assets tumbling as Bitcoin drops -4.7% at $19,700, and Ethereum (ETH) -5.9% at $1,482 as crypto broadly lower on the FTX (Sam Bankman Fried) vs Binance fight ongoing

·     Brighthouse Financial (BHF) Q3 adj EPS $1.35 vs. est. $1.32; Q3 revs $1.48B vs. est. $1.9B; Annuity sales increased 58% y/y and 50% sequentially — Life sales decreased 30% over the third quarter of 2021 and were flat sequentially; Book value per share $58.73

·     Brookdale Senior Living (BKD) Q3 EPS loss (-$0.15) vs. est. loss (-$0.13); Q3 revs $757.46M vs. est. $755.08M; Q3 consolidated RevPAR increased 9.7% y/y; lowers FY22 adj EBITDA view to $250M-$260M from $270M-$290M; narrows FY22 RevPAR growth view to ~10% from 10%-12%

 

Healthcare

·     Oak Street Health (OSH) 3Q EPS ($0.56) vs est. ($0.61) on revs $545.7Mm vs est. $539.7Mm; guides FY revs $2.15-2.155B vs est. $2.14B

·     QUIAGEN (QGEN) Q3 adj EPS $0.53 vs. est. $0.45; Q3 sales $500M vs. est. $480.4M; exceeds outlook for q3 2022 with 18% CER sales growth in non-covid product portfolio and raises full-year 2022 outlook to about $2.25C, reaffirmed double-digit CER growth in non-covid products

·     Sabra Health (SBRA) 3Q AFFO/shr $0.34 vs est. $0.37 on revs $140.8Mm vs est. $155.2Mm; net debt to adj EBITDA $5.5x; expect closer to 5.0x by end of year

·     Sage Therapeutics (SAGE) says completion of rolling NDA submission for zuranolone in MDD and PDD on track for December 2022

·     ShockWave Medical (SWAV) Q3 EPS $0.92 vs. est. $0.67; Q3 revs $131.3M vs. est. $123.97M; raises FY22 revenue view to $483M-$488, up 104%-106% growth y/y and above prior guidance of $465M-$475M (est. $475.94M)

·     Roivant Sciences (ROIV) offering 30M shares priced at $5.00; sees runway to fund operating expenses, capital spending needs into 2nd half of 2025

 

Industrials & Materials

·     Manitowoc (MTW) Q3 adj EPS $0.10 vs. est. $0.09; Q3 revs rose 12.4% y/y to $454.7M vs. est. $498.12M; sees headwinds to continue in 4q; sees FY adj EBITDA low end of $130M-$160M vs. est. $133.5M; Q3 backlog of $943.4M, up 5.9% year-over-year

·     Mosaic (MOS) Q3 adj EPS $3.22 vs. estimate $3.41; Q3 sales rose 565 y/y to $5.35B vs. est. $5.79B; adjusted EBITDA $1.69B, +74% y/y

·     LSB Industries (LXU) 14.35M share Spot Secondary priced at $13.50

 

Technology, Media & Telecom

·     Take-Two Interactive (TTWO) shares fall; Q2 EPS loss (-$1.54) on revs $1.4B vs. est. $1.55B; cut its net bookings guidance for the full year to $5.4B-$5.5B from $5.8B-$5.9B view and est. $5.9B; also guides Q3 net bookings $1.41B-$1.46B vs. est. $1.69B

·     Nvidia Corp (NVDA) said it is offering a new advanced chip in China that meets recent export control rules aimed at keeping cutting-edge technology out of China’s hands. – Reuters

·     DigitalOcean (DOCN) Q3 adj EPS $0.38 vs. est. $0.23; Q3 revs $152.12M vs. est. $149.06M; sees FY22 adjusted EPS $0.79-$0.80 vs. est. $0.75; sees FY22 revs $573M-$575M vs. est. $573.59M; qtrly average revenue per customer (ARPU) $79.22, up 28%

·     Fabrinet (FN) 1Q adj EPS $1.97 vs est. $1.74 on revs $655.4Mm vs est. $630.2Mm; guides 2Q revs $640-660Mm vs est. $632.4Mm and adj EPS $1.86-1.93 vs est. $1.73

·     Five9 (FIVN) Q3 adj EPS $0.39 vs. est. $0.34; Q3 revs rose 29% y/y to $198.3M vs. est. $195.3M; guides Q4 EPS and revs below views and cut its adjusted EPS for year to $1.35-$1.37, from prior $1.38-$1.40 and lower revs outlook as well

·     Groupon (GRPN) Q3 adj EPS (-$0.68) vs. est. loss (-$0.53); Q3 revs fell -33% y/y to $144.39M vs. est. $156.42M; Adjusted EBITDA loss $8.60 million vs. profit $34.6 million y/y

·     LivePerson (LPSN) 3Q EPS ($0.56) vs est. ($0.07) on revs $129.6Mm vs est. $123.5Mm, adj EBITDA $9.1Mm vs est. $3.75Mm; guides FY revs $517-521Mm vs est. $515.6Mm, adj EBITDA $1-10Mm vs est. $2.2Mm

·     Nintendo Co Ltd (NTDOY) cut its full-year Switch sales projection by nearly 10% after microchip shortages constrained console production, but raised its annual net profit forecast, thanks to a softer yen.; sees net profit of 400 billion yen ($2.73 billion) for the year to March 2023, up from the previous forecast of 340 billion.

·     Sanmina Corp. (SANM) Q4 adj EPS $1.50 vs. est. $1.33; Q4 revs $2.2B vs est. $2.01B; sees Q1 adj EPS $1.41-$1.51 vs. est. $1.33 and sees Q1 revenue $2.1B-$2.2B vs. est. $1.99B

·     Teradata Corp. (TDC) Q3 EPS $0.31 vs. est. $0.29; Q3 revs $417M vs. est. $421.6M; reports public cloud ARR of $279M, an increase of 89% as reported and 99% in constant currency; narrows FY22 EPS view to $1.58-$1.62 vs. est. $1.60