Morning Preview: May 3rd, 2017

eOptionDaily Market Report

U.S. stock futures are slipping early as Apple (AAPL) shares fall overnight after the iPhone maker reported a quarterly revenue, forecast miss. However, the Nasdaq Composite is still coming off an all-time high yesterday as earnings season has lifted sentiment and provided more upward momentum for a stock market that has shown no fear. Note AAPL came into last night’s report up 27% YTD and had closed at record highs. Oil prices rebound from 6-week lows after the American Petroleum Institute said late Tuesday that U.S. oil inventories fell 4.2 million barrels last week (ahead of DoE data later this morning). Today may be more of a macro focus as investors are waiting for ADP’s report on private-sector employment that is due before the market open (8:15 AM ET), as well as a policy announcement from the Federal Reserve that is expected in the afternoon (2:00 PM ET).

In Asian markets, The Nikkei and Hang Seng Index were both closed, while the Shanghai Index slipped -8 points to settle at 3.135. In Europe, markets slipped from 20-month highs after weakness in autos and after Apple results/guidance weighed on chip makers. The German DAX is down about -25 points to 12,480, while the FTSE 100 is off around -20 points at 7,225.

Market Closing Prices Yesterday

  • The S&P 500 Index jumped 12.58 points, or 0.65%, to 2,140.45
  • The Dow Jones Industrial Average rose 98.58 points, or 0.59%, to 18,836.10
  • The Nasdaq Composite spiked 44.58 points, or 0.05%, to 5,296.23
  • The Russell 2000 Index advanced 22.72 points, or 0.55% to 1,243.94

Events Calendar for Today

  • 7:00 AM ET          MBA Mortgage Applications Data
  • 8:15 AM ET          ADP Employment change for April…est. 175K
  • 9:45 AM ET          Markit US Composite PMI, Apr-F…
  • 9:45 AM ET          Markit US Services PMI, Apr-F…est. 52.5
  • 10:00 AM ET       ISM Non-Manufacturing Comp for April…est. 55.8
  • 10:30 AM ET       Weekly DOE Inventory Data
  • 2:00 PM ET          FOMC Rate decision

Earnings Calendar:

  • Earnings Before the Open: ADP, BDC, BG, CDW, CLX, CVLT, DHX, DLPH, EL, EXC, FLOW, GRMN, GRPN, HRS, HUM, ICE, KLIC, LFUS, MCK, NI, NYT, ORBK, Q, RAI, S, SBGI, SO, SPR, TAP, TWX, VSH, WCG, YUM
  • Earnings After the Close: AIG, ALB, ALL, ANSS, ARRS, AWK, CACI, CAKE, CATM, CF, CRUS, CSGS, CTL, CXO, DDD, EXTR, FB, FIT, FIVN, FRT, GLUU, ITRI, KHC, LNC, LNT, LVLT, MANT, MET, MUR, MX, NSIT, NUS, PRU, PXD, QRVO, RIG, SQ, TIVO, TSLA, TTMI, WMB

World News

  • German Jobless claims fell by 15,000 from March, the BA labor agency said vs. expectations of a decline of 10,000 jobs; adjusted jobless rate was unchanged at 5.8% in April
Sector News Breakdown

Consumer

  • Mondelez (MDLZ) Q1 EPS 53c/$6.41B vs. est. 50c/$6.37B; sees double-digit adjusted EPS growth in FY17 and continues to expect organic net revenue to increase at least 1% in 2017 and adjusted operating income margin in the mid-16% range
  • Hanesbrands (HBI) Q1 EPS 29c/$1.38B vs. est. 28c/$1.38B; sees Q2 EPS 51c-54c on revs roughly $1.65B vs. est. 56c/$1.68B
  • Etsy (ETSY) shares fall; Q1 EPS 0c/$96.9M vs. est. 1c/$98.4M; 1Q gross merchandise sales $719.0M; Chad Dickerson to Step down as CEO and Board Chair
  • Bojangles (BOJA) Q1 EPS 20c/$131.5M vs. est. 17c/$133.26M; Q1 system-wide comparable restaurant sales decreased 1.7%, while company-operated comparable restaurant sales decreased (-3.5%); reiterates year guidance
  • Denny’s (DENN) Q1 EPS 12c/$127.9M vs. es.t 13c/$129.3M; Q1 comparable sales (-1.1%) vs. est. +1%; reaffirms year forecast
  • Potbelly (PBPB) Q1 EPS 5c/$101.7M vs. est. 5c/$103.2M; sees FY adjusted EPS 35c to 38c, vs. est. 47c; Q1 comparable sales -3.1%, vs. est. -1.0%
  • Boyd Gaming (BYD) Q1 EPS 32c/$605.3M vs. es.t 31c/$605.4M; Q1 adjusted Ebitda $155.8M and reaffirms year Ebitda outlook
  • Big 5 Sporting Goods (BGFV) shares jumped 10%; Q1 EPS 24c/$253M vs. est. 14c/$246M; Q1 store sales increased 7.9% vs. est. 4.8%, driven by favorable weather conditions and market share gains resulting from the closure of certain major competitors.
  • Weight Watchers (WTW) Q1 EPS 16c/$329.1M vs. es.t loss (4c)/$321.9M; end of period subscribers in Q1 2017 were up 16.0% versus the prior year period; raises FY17 EPS view to $1.40-$1.50 vs. consensus $1.27

Energy

  • Devon Energy (DVN) announced its intent to divest approximately $1B of upstream assets across its portfolio; Devon Energy announced its intent to divest approximately $1B of upstream assets across its portfolio; 1Q core EPS 41cvs. est. 39c; Q1 production 563 mboe/d; Q1 lease operating expenses $386M; sees 2Q production 230 to 240 mboe/d and cap-ex $600M-$675M
  • Diamondback Energy (FANG) Q1 EPS $1.46 vs. est. 60c; reports Q1 production of 61.6 Mboe/d, up 19% over Q4; sees 2017 Total Net Production 69.0 – 76.0 Mboe/d
  • First Solar (FSLR) raises FY17 adjusted EPS to 25c-75c from 0c-50c (est. 32c); raises FY17 revenue to $2.85B-$2.95B from $2.8B-$2.9B (est. $2.78); cuts adjusted OpEx to $320M-$340M from $280M-$300M; Q1 EPS 25c/$891.8M vs. es.t loss (14c)/$693.1M
  • Newfield Exploration (NFX) Q1 EPS 57c/$417M vs. est. 44c/$425.49M; total net production in the Q1 was 145,978 BOEPD, comprised of 43% oil, 19% natural gas liquids and 38% natural gas. Domestic production in Q1 was 138,833 BOEPD, comprised of 40% oil, 20% natural gas liquids and 40% natural gas
  • Anadarko (APC) Q1EPS loss (60c) vs. es.t loss (23c); 1Q sales vol. 795,000 mboe/d; sees 2Q sales volume 57 to 59 MMBoe
  • The American Petroleum Institute (API) said weekly crude inventories fell 4.16M barrels in the latest week; gasoline with a drawdown of -1.93M barrels and distillates -436k barrels
  • Callon Petroleum (CPE) Q1 EPS 10c/$78.9M vs. est. 10c/$78.3M; Q1 production 20,422 boe/d and sees Q2 production 21,500 to 23,500 boe/d
  • Viper Energy (VNOM) Q1 EPS 22c vs. est. 19c; reports Q1 production of 8,519 boe/d, up 8% QoQ

Financials

  • Allstate (ALL) 1Q operating EPS $1.64 vs. est. $1.06; 1Q net premiums written $7.72B, 1Q net premiums earned $7.96B; reports Q1 book value per share $52.41 vs. $48.89 a year ago
  • Western Union (WU) Q1 EPS 35c/$1.30B vs. est. 39c/$1.29B; reaffirms FY adj. EPS guidance; Backs “flat to low single digit decrease” in FY17 GAAP revenue, or “low single digit increase” in constant currency
  • RenaissanceRe (RNR) Q1 EPS $1.18 vs. est. $1.87; Q1 net premiums written $544.1M and Q1 net investment income $54.3m
  • Acadia Realty Trust (AKR) files automatic mixed securities shelf

Healthcare

  • Gilead (GILD) Q1 EPS $2.23/$6.51B vs. est. $2.29/$6.63B; product revs: Harvoni revs $1.37B, Sovaldi revs $313M, Epclusa revs $892M, Truvada revs $714M (light), Genvoya revs $769M, Atripla revs $452M (light)
  • Perrigo (PRGO) offices searched by U.S. agents in drug pricing probe
  • DaVita (DVA) Q1 EPS 79c/$3.70B vs. est. 81c/$3.69B; sees FY operating income $1.64B-$1.78B
  • Envision Healthcare (EVHC) Q1 EPS 77c/$1.88B vs. est. $1.70B; had a net loss from discontinued operations of $478.2M; sees Q2 adjusted EPS 78c-84c and adjusted EBITDA $247M-$258M
  • Myriad Genetics (MYGN) Q3 EPS 27c/$196.9M vs. es.t. 24c/$189.1M; raises year revs to $763M-$765M from $745M-$755M and est. $751.1M
  • TherapeuticsMD (TXMD) said it anticipates FDA action on the New Drug Application for TX-004HR on or before the originally scheduled Prescription Drug User Fee Act target action date of May 7, 2017
  • USANA Health Sciences (USNA) Q1 EPS 91c/$255.3M vs. est. 92c/$253.51M; backs FY17 EPS view $3.80-$4.10 and rev view $1.04B-$1.07B vs. est. $4.10/$1.06B
  • WebMD (WBMD) Q1 EPS 30c/$154.1M vs. est. 27c/$152.64M; sees 2Q revenue $170M-$173M, vs. est. $171M; reaffirms year guidance
  • Ignyta (RXDX) files to sell 10M shares of common stock

Industrials & Materials

  • FMC Corp (FMC) Q1 EPS 43c/$596M vs. est. 57c/$755.5M; sees FY adjusted EPS $2.20-$2.60, vs. est. $3.41 (had seen $3.20-$3.60)
  • Kadant (KAI) Q1 EPS 80c/$103M vs. est. 70c/$101M; raises FY17 EPS view to $3.27-$3.37 from $3.13-$3.23 (est. $3.38) and raises FY17 revenue view to $427M-$437M from $423M-$433M vs. consensus $431.16M
  • Sterling Construction (STRL) raises FY17 revenue view to $850M-$880M from $720M-$750M

Media & Telecom

  • Match Group (MTCH) Q1 EPS 12c/$298.8M vs. est. 13c/$292.9M; QA1 Ebitda $86.2M vs. $67.3M YoY; North America direct revs $177.4M vs. $168.4M YoY
  • Frontier Communications (FTR) Q1 EPS loss (8c)/$2.36B vs. est. loss (5c)/$2.35B; said plans to issue secured debt in 2Q; reaffirms forecast for year FCF and capex; determines to set reverse split ratio at 1-for-15

Technology

  • Apple (AAPL) Q2 EPS $2.10/$52.9B vs. est. $2.02/$53.1B; sees Q3 revs $43.5B-$45.5B vs. est. $45.7B and sees FY3Q gross margin 37.5%-38.5% vs est. 38.3%; product breakdown for Q2: iPhone units sold 50.8M vs. est. 51.4M, Q2 iPhone ASP ~$655 vs, est. ~$666; authorizes $50B increase to capital return program and extends program timeframe by four quarters; boosts share buyback program to $210B from $175B and boosts quarterly dividend by 10.5% to 63c; Q2 Other Products revenue $2.87B vs. $2.19B last year; Q2 iPad units 8.92M vs. 10.25M last year
  • Akamai (AKAM) Q1 EPS 69c/$609M vs. est. 67c/$604.69M; 1Q performance and security solutions rev. $369.1M, cloud security revs. $109.8M and media delivery revs $187.4M
  • Cornerstone OnDemand (CSOD) Q1 EPS 8c/$111.6M vs. est. loss (1c)/$110.55M; Q1 billings of $89.7M, representing a 7.2% increase YoY; sees FY17 revenue of $477M-$487M vs. est. $481.9M; sees Q2 revenue of $115M-$118M vs. consensus $119.3M
  • Cray (CRAY) shares fall on guidance; Q1 EPS loss (71c)/$59M vs. est. loss (50c)/$55.4M: sees FY revenue $400M-$450M vs. est. $584.8M
  • FireEye (FEYE) Q1 EPS loss (9c)/$173.7M vs. es.t loss (26c)/$163.7M; reports Q1 billings of $152.4M, a decrease of 18% from Q1; sees Q2 EPS loss (10c)-(14c) on revs $173M-$179M vs. es.t loss (14)/$173.3M; sees Q2 billings of $155M-$175M
  • GoDaddy (GDDY) Q1 EPS 1c/$489.7M vs. est. loss (6c)/$487.9M; reports bookings of $624.8M, up 12.0% year over year; raises year revenue outlook
  • Guidance Software (GUID) Q1 EPS 7c/$26.8M vs. est. 5c/$26.78M; backs FY17 adjusted EPS 28c-36c on revs $112M-$118M vs. est. 31c/$115.69M
  • HubSpot (HUBS) Q1 EPS 3c/$82.3M vs. est. loss (8c)/$79.29M; sees Q2 adjusted EPS (2c)-0c, on revs $85M-$86M vs. est. loss (5c)/$84.58M; raises FY17 adjusted EPS view to (10c)-(4c) from (30c)-(22c) and sees FY17 revenue $355.5M-$359.5M
  • Oclaro (OCLR) Q3 EPS 23c/$162.2M vs. est. 20c/$160.19M; sees Q4 revenue $144M-$152M, vs. consensus $164.58M and sees Q4 non-GAAP gross margin 38%-41% (optical stocks dropped sharply yesterday – OCLR shares down overnight on guidance – watch FNSR, ACIA, LITE, NPTN)
  • Paycom (PAYC) Q1 EPS 47c/$119.5M vs. est. 41c/$115.8M; sees Q2 revenue $94.5M-$96.5M, vs. consensus $94.73M and sees Q2 adjusted EBITDA $22M-$24M; sees 2017 revenue $426M-$428M vs. consensus $423.2M
  • Twilio (TWLO) shares fell 20%; reports Q1 EPS loss (4c)/$87.4M vs. est. loss (6c)/$83.6M; Q1 had 40,696 active customer accounts as of March 31, compared to 28,648 YoY; sees Q2 EPS loss (11c)-(10c)on revs $85.5M-$87.5M vs. est. loss (8c)/$87.8M.
  • Verisk Analytics (VRSK) Q1 EPS 74c/$502.6M vs. est. 79c/$513.78M
  • Viavi (VIAV) Q3 EPS 9c/$196.0M vs. est. 7c/$196.82M; sees Q4 non-GAAP EPS 7c-9c on revs $188M-$204M vs. est. 9c/$205.86M
  • DigitalGlobe (DGI) Q1 EPS loss (5c)/$209.7M vs. est. loss (3c)/$199.9M citing strong performance in both U.S. government and diversified commercial; backs FY17 revenue $840M-$865M

Market commentary provided by Hammerstone Markets, a division The Hammerstone Group, a firm separate from and not affiliated with Regal Securities L.P.  Regal Securities L.P. has not participated in the creation of the content, and does not explicitly or implicitly endorse the content.

Live Trading

Open an Account

Paper Trading

Register