Early Look

Thursday, November 12, 2020

Futures	Up/Down	%	Last
DJ Industrials	-151.00	0.52%	29,160
S&P 500	-5.50	0.15%	3,562
Nasdaq	56.50	0.48%	11,942

 

 

Stock futures in the U.S. look mixed as technology stocks continue yesterday’s rebound (following selling pressure the first two days of the week), while the S&P 500 and Dow look slightly lower ahead of weekly jobless claims. Helping futures overnight, Moderna (MRNA) announced that the first interim analysis of results from the large-scale pivotal study, COVE, of vaccine candidate mRNA-1273 will include “substantially more” that the 53 cases it was expecting. In trade news, TikTok has filed a petition challenging an executive order by President Trump, as well as a sales process being overseen by CFIUS as the video-sharing app is facing a deadline today that requires the company be spun off from its Chinese parent, ByteDance. It also said in the filing that it proposed a new deal this month that would effectively hand over control of TikTok in the U.S. to Oracle (ORCL), Walmart (WMT) and ByteDance’s U.S. investors. Major U.S. averages ended mixed on Wednesday, with investors switching back to tech stocks and away from economically sensitive sectors (cruise lines, airlines, mall stocks sold off again) as they weighed COVID-19 vaccine progress against a virus surge. Oil futures are little changed after rising three straight days, under pressure overnight after the IEA lowered its world oil demand to contract by 8.8M barrels per day this year, reflecting a downward revision of 0.4M barrels (follows a reduced outlook forecast from OPEC yesterday). In Asian markets, The Nikkei Index gained 171 points to 25,520, the Shanghai Index dipped 3 points to 3,338 and the Hang Seng Index slipped -57 points to 26,169. In Europe, the German DAX is down about -100 points to 13,110, while the FTSE 100 fell -20 points to 6,355. Coronavirus global cases of COVID-19 top 52 mln and U.S. sets case and hospitalization records.

Market Closing Prices Yesterday

·     The S&P 500 Index gained 27.13 points, or 0.77%, to 3,572.66

·     The Dow Jones Industrial Average fell -23.29 points, or 0.08%, to 29,397.63

·     The Nasdaq Composite jumped 232.58 points, or 2.01%, to 11,786.43

·     The Russell 2000 Index dipped -0.07 points, or 0.01% to 1,736.94

 

Economic Calendar for Today

·     8:30 AM EST      Weekly Jobless Claims…est. 735K

·     8:30 AM EST      Continuing Claims…est. 6.90M

·     8:30 AM EST      Consumer Price Index (CPI) MoM for Oct…est. 0.1%

·     8:30 AM EST      CPI Ex: Food & Energy MoM for Oct…est. 1.3%

·     8:30 AM EST      Consumer Price Index (CPI) YoY for Oct…est. 0.2%

·     8:30 AM EST      CPI Ex: Food & Energy YoY for Oct…est. 1.8%

·     10:30 AM EST    Weekly EIA Natural Gas Inventory Data

·     11:00 AM EST    Weekly EIA Inventory data (pushed out a day)

·     2:00 PM EST       Federal Budget for October

 

Earnings Calendar:

·     Earnings Before the Open: AXLA, BKYI, BW, ENR, ENS, EPC, HOOK, HYLN, INOD, MTOR, PFIN, SBH, SPH, SSYS, TDG, TGEN, UONEK

·     Earnings After the Close: ACHV, AEYE, AGRX, AMAT, APTX, AWH, BANX, BBI, BIOC, BLNK, BRP, BZH, CSCO, DIS, ETON, IPWR, LTRX, MEG, NBY, OPNT, PLTR, SALM, STON, TPCS, U

 

Other Key Events:

·     Baird Industrials Conference, 11/10-11/12 (virtual)

·     Credit Suisse 29th Annual Healthcare Conference, 11/9-11/2 (virtual)

·     Roth Capital Technology Conference 11/11-11/12 (virtual)

·     Society of Immunotherapy Conference, 11/9-11/14 (virtual)

·     UBS European Virtual Conference, 11/9-11/13

 

 

Macro	Up/Down	Last
WTI Crude	0.10	41.55
Brent	0.08	43.88
Gold	6.50	1,872.25
EUR/USD	0.0035	1.1812
JPY/USD	-0.15	105.28
10-Year Note	-0.037	0.94%

 

 

Sector News Breakdown

Consumer

·     Allegiant Travel (ALGT) reported preliminary passenger traffic results for October. For scheduled service, passengers were down 20.1%, revenue passenger miles were down 29.0%, available seat miles were down 6.4%, load factor was down 20.0 points, vs. October 2019

·     Edgewell Personal Care (EPC) Q4 adj. EPS 59c on revs $488.8M vs. est. 56c and $466.41M; said it expects the strategic initiative it launched in 2018 to generate savings of $265 million to $275 million in fiscal 2021; said it plans to use the savings for fuel investments and brand building; sees FY21 adj. EPS $2.62-$2.82 vs. est. $2.76

·     XPeng Inc. (XPEV) rises 11% after the China-based electric vehicle maker reported a Q2 loss that widened from a year ago but revenue that jumped more than fourfold as deliveries soared 266%; deliveries climbed 265.8% from last year to 8,578 vehicles, while deliveries of the P7 vehicle were 6,210, up from 325 in the sequential second quarter.

·     Fossil Group (FOSL) Q3 EPS $0.31 on sales $435.5Mm; says expects Covid impact to continue to pressure sales in 4Q20, expects to end 4Q with about $30Mm available under revolver

·     GrowGeneration (GRWG) 3Q EPS $0.07 vs. est. $0.06 on revs $55Mm vs. est. $47.4Mm; guides FY20 revs $185-190Mm vs. est. $174.5Mm, sees FY20 adj EBITDA $19-20Mm vs. est. $17.6Mm; guides FY21 adj EBITDA $34-36Mm vs. est. $28.2Mm

·     HyreCar Inc. (HYRE) Q EPS ($0.10) vs. est. ($0.12) on revs $6.8Mm vs. est. $6.4Mm, says rental days over 273K vs 231K in 2Q

·     International Game Technology (IGT) shares jumped 20%; Q3 revs $982M vs. est. $808M; Q3 adj EPS 26c vs. est. loss (21c)

·     Revolve Group (RVLV) 3Q EPS $0.27 vs. est. $0.14 on net sales $151.04Mm vs. est. $154.2Mm, says net sales -HSD % YoY during October and Covid has continued to have a negative impact on results in weeks since end of 3Q; says apparel products frequently worn at home and styles for active lifestyles have remained strong since end of 3Q

·     SpartanNash (SPTN) Q3 adj EPS $0.70 vs. est. $0.62 on sales $2.06B vs. est. $2.14B; guides FY20 adj EPS $2.42-2.50 from prior $2.40-$2.60 and vs. est. $2.55, sees FY adj EBITDA $237-242Mm

·     Vroom (VRM) Q3 adjusted EPS loss (29c) on revs $323M vs. est. loss (37c) and $310.61M; Q3 Ecommerce Unit Sales Up 59% YoY to 8,823 and Ecommerce revenue of $221.8 million, up 25% YoY; sees Q4 EPS (41c)-(35c) vs. est. loss (36c) and sees Q4 revenue $372M-$414M vs. est. $403.47M

 

Energy, Industrials and Materials

·     The IEA said it now expects world oil demand to contract by 8.8M barrels per day this year, reflecting a downward revision of 0.4M barrels from last month’s assessment, but lifted its expectations for 2021 saying global oil demand growth will rise by 5.8M bpd next year. The forecast comes a day after OPEC cut its global oil demand forecasts.

·     Enersys (ENS) 2Q adj EPS $0.83 vs. est. $0.98 on sales $708Mm vs. est. $723.6Mm, sees 3Q adj EPS $1.17-1.23 vs. est. $1.17

·     Hillenbrand (HI) Q4 EPS 92c on revs $693.7M vs. est. 56c and $620.38M

·     NV5 Global (NVEE) Q3 EPS $1.13 on revs $169.8M vs. est. 70c and $156.35M; said during the quarter, we generated $21.7 million in cash flows from operations; gross revenues grew by 30% in q3 of 2020 to $169.9 mln compared to $131.0 mln in q3 of 2019

·     Reynolds (REYN) Q3 adjusted EPS 56c on revs $823M vs. est. 51c and $796.96M; boosted its adjusted EPS for the year to $1.95-$1.97 from prior view of $1.67-$1.76 (est. $1.94); sees Q4 revenue growth mid-single digits

·     Tetra Tech (TTEK) 4Q adj EPS $0.91 vs. est. $0.80 on revs $753Mm vs. est. $586.2Mm; guides 1Q revs $570-600Mm vs. est. $593.4Mm, sees 1Q EPS $0.73-0.83 vs. est. $0.82; guides FY21 revs $2.35-2.55B vs. est. $2.42B, sees FY21 EPS $3.30-3.50 vs. est. $3.38

 

Financials

·     AllianceBernstein (AB) announced that preliminary assets under management decreased to $622B during October 2020 from $631B at the end of September

·     GoHealth (GOCO) Q3 EPS loss (65c) worse than the est. loss (1c) and Q3 revenue $163.4M vs. est. $169.54M; sees FY net revenue of $850M-890M (est. $870.6M), representing Y/Y growth of 58-65%; adjusted EBITDA of $270M-290M, representing Y/Y growth of 58-70%

·     First Republic (FRC) files to sell 1.5M shares of common stock

·     Manning & Napier (MN) reports preliminary AUM $18.5B as of October 31, compared with $19.2B at September 30

·     Stifel (SF) announces a three-for-two stock split & intention to increase its common stock dividend by 32%

 

Healthcare

·     Moderna (MRNA) announced that the first interim analysis of results from the large-scale pivotal study, COVE, of vaccine candidate mRNA-1273 will include “substantially more” that the 53 cases it was expecting. Case accrual has been completed for the readout.

·     AstraZeneca (AZN) reports Phase II results from The CALAVI trials investigating BTK inhibitor Calquence (acalabrutinib) plus best supportive care (BSC) versus BSC alone in hospitalized patients with COVID-19 disease. Calquence did not meet the primary efficacy endpoint.

 

Technology, Media & Telecom

·     Foxconn forecast strong demand for the new iPhone 12 in the holiday quarter and stressed that it would continue investing in the United States as scheduled and is looking at making new products there (watch for AAPL suppliers)

·     Himax (HIMX) Q3 non-IFRS EPS 7c on revs $239.93M vs. est. 3c and $175.3M; sees q4 2020 IFRS profit per diluted ads to be around 15.0 cents to 16.0 cents and sees q4 2020 non-IFRS profit per diluted ads to be around 15.1 cents to 16.1 cents

·     Pinduoduo (PDD) Q3 EPS 5c vs. est. loss (17c) and revs $2.09B topped the consensus $1.86B; Q3 average monthly active users were 643.4M, an increase of 50% from 429.6M YoY and active buyers in the twelve-month period ended September 30 were 731.3M, an increase of 36% from 536.3M YoY

·     Stratasys (SSYS) Q3 non-GAAP EPS loss (5c) on revs $127.9M vs. est. loss (7c) and $122.14M

·     Wix.com (WIX) Q3 EPS loss (14c) on revs $254.18M vs. est. loss (15c) and $249.91M; sees FY20 revenue $972M-$977M above est. $966.85M and sees FY20 collections $1.09B-$1.1B; guides FY20 free cash flow $122M-$127M