Morning Preview: May 9th, 2017

eOptionDaily Market Report

Stock futures are slightly higher after finishing little changed on Monday, as European markets jumps overnight following impressive data out of Germany and the French election victory on Sunday for Emmanuel Macron that investors had largely priced in. There has been nothing but strength for global stocks, as the Nasdaq Composite closed at another fresh record yesterday, while the Dow trades back above 21,000 and the S&P 500 right around 2,400. Bonds have slowly sold off the last few sessions as yields climb, while energy prices attempt to stabilize after a recent rout took prices to the lowest levels in over 6-months. The S&P 500 on Friday extended to a third weekly gain, boosted by data showing a rebound in payrolls. The CBOE Volatility Index (VIX) falls 7.6% yesterday to close at 9.77, its lowest since 1993. The dollar has quietly risen the last few sessions, as it approaches the 114 level against the yen, while the euro slides back below the 1.09 level for the first time in two-weeks following profit taking after the results of the French election offered no surprises. Markets prepare for another round of corporate earnings this morning (and week) as well as a few Fed speakers and economic data.

In Asian markets, The Nikkei Index fell -52 points to settle at 19,843, the Shanghai Index inched higher 1 point to finish at 3,080 and the Hang Seng Index jumped 311 points to close at 24,889. In Europe, the German DAX is higher by over 60 points at 12,750, while the FTSE 100 is higher by 0.5% around 7,340. European indexes have climbed this year, with France’s CAC 40 at its highest since 2008 and Germany’s benchmark at an all-time high.

Market Closing Prices Yesterday

  • The S&P 500 Index inched higher 0.09 points, or 0.00%, to 2,399.39
  • The Dow Jones Industrial Average rose 5.34 points, or 0.03%, to 21,012
  • The Nasdaq Composite gained 1.90 points, or 0.03%, to 6,102.66
  • The Russell 2000 Index declined -5.36 points, or 0.38% to 1,391.64

Events Calendar for Today

  • 6:00 AM ET          NFIB Small Business Optimism for April…est. 104.0
  • 7:45 AM ET          ICSC Weekly Retail Sales
  • 8:55 AM ET          Johnson/Redbook Weekly Sales
  • 10:00 AM ET       JOLTs Openings for March…est. 5738
  • 10:00 AM ET       Wholesale Inventories MoM for March…est. (-0.1%)
  • 1:00 PM ET          Fed’s Rosengren speaks at NYU conference on risk management
  • 4:15 PM ET          Fed’s Kaplan speaks to Dallas Regional Chamber
  • 4:30 PM ET          API Weekly Inventory Data

Earnings Calendar:

  • Earnings Before the Open: ACM, AGN, AON, ARMK, BLD, CBOE, DF, DISCA, DUK, JEC, RESI, SEAS, SEE, SNCR, TDG, TGNA, TVPT, USFD, VRX
  • Earnings After the Close: ALRM, BUFF, CALX, CLI, DIOD, DIS, DOX, EA, FOSL, GDOT, JAZZ, MCHP, MIME, MXL, NEWR, NVDA, NWS, PCLN, PRI, QNST, REG, RPD, SCSC, SEDG, TRIP, TRUE, TWNK, YELP, ZAYO

World News

  • Germany posted its strongest trade figures on record Tuesday, with exports up 0.4% in March to a record €118.2 billion. Imports climbed 2.4% to €92.9 billion.
  • April Small Business Optimism falls to 104.5 vs. est. 104; 24% of employers think it is a good time to expand; net percentage of employers anticipating job creation unchanged at 16%; net percentage of firms expecting a better economy falls to 38%
Sector News Breakdown

Consumer

  • Marriott (MAR) Q1 EPS $1.01/$5.56B vs. est. 91c/$5.29B; sees FY17 EPS $3.92-$4.09 vs. est. $3.94; Q1 North American comparable systemwide RevPAR rose 3.1%; added more than 17,000 rooms during the first quarter; raises year Ebitda view to $3.1B-$3.2B from $3.08B-$3.18B (est. $3.13B); boosts 2017 RevPAR and adjusted Ebitda guidance
  • Hertz Global Holdings (HTZ) Q1 EPS loss ($1.61)/$1.92B vs. est. loss (84c)/$1.95B;
  • Builders FirstSource (BLDR) Q1 EPS 11c/$1.5B vs. est. 5c/$1.49B; Q1 adjusted EBITDA grew $14.3M to $76.1M
  • CST Brands (CST) Q1 EPS 15c/$2.37B vs. est. 27c/$2.72B; expects to complete merger during current calendar quarter with Circle K Stores
  • Fiesta Restaurant (FRGI) Q1 EPS 25c/$175.6M vs. est. 29c/$178.1; Q1 comps at Pollo Tropical decreased 6.7% and comparable transactions decreased 8.9%; comparable restaurant sales at Taco Cabana decreased 4.5% and comparable restaurant transactions decreased 4.0%
  • Fogo De Chao (FOGO) Q1 EPS 18c (in-line); Q1 comps rose 0.3% vs. Bloomberg est. (-1.4%); files to sell 4.5M shares for Thomas H. Lee
  • International Flavors (IFF) Q1 EPS $1.52/$828.3M vs. est. $1.51/$831.82M; reaffirms 2017 adjusted EPS outlook up 3.5%-4.5% and sales up 6%-7%
  • Kona Grill (KONA) Q1 EPS loss (33c)/$45.2M vs. est. loss (22c)/$47.56M; Q1 restaurant sales increased 15.1% to $45.2M; same-store sales decreased 4.3% compared to a 3.6% gain from the prior year; lowers FY17 revenue view to $190M from $200M vs. est. $199.54M
  • Masonite (DOOR) Q1 EPS 77c/$487M vs. est. 73c/$497.61M; sales volume was down slightly in the first quarter compared to a very strong comparative quarter in 2016.
  • Post Holdings (POST) Q2 EPS 55c/$1.26B vs. est. 58c/$1.25B; Q2 adj. Ebitda $228.5M; sees FY capital expenditure $180M-$200M
  • Sturm Ruger (RGR) Q1 EPS $1.21 on sales $167.4M; expands stock buyback program to $100M

Energy

  • EOG Resources (EOG) Q1 EPS 15c/$2.61B vs. est. 15c/$2.41B; 1Q production 315.70 mb/d; Q1 Ebitda $1.13B vs. Bloomberg est. $1.12B; said Q1 lease operating expenses $255.8M
  • Antero Resources (AR) Q1 EPS 18c/$721.0M vs. est. 9c/$802.65M; Q1 net daily gas equivalent production averaged a record 2,144 MMcfe/d (28% liquids), a 22% increase over the prior year quarter
  • Atwood Oceanics (ATW) Q2 EPS loss (37c)//$167.7M vs. est. loss (30c)/$122.4M
  • Delek US (DK) Q1 EPS 16c/$1.18B vs. est. loss 33c/$902.6M
  • Gulfport Energy (GPOR) Q1 EPS 32c vs. consensus 18c; Q1 production 849.6 MMCFE/D; reaffirms year cap-ex and production forecasts
  • Oasis Petroleum (OAS) Q1 EPS loss (5c)/$285.1M vs. est. loss (7c)/$258.4M; Q1 production 63,192 boe/d; continues to expect to meet forecast ’17, ’18 exit rates
  • Plains All American (PAA) Q1 EPS 27c/$6.67B vs. est. 37c/$5.43B; Q1 adjusted Ebitda $512M

Financials

  • AmTrust Financial Services (AFSI) Q1 EPS 32c/$1.43B vs. est. 61c/$1.45B; Q1 net premiums earned $1.22B, Q1 gross written premiums $2.27B, 1Q combined ratio 95.6%
  • Franklin Resources (BEN) prelim month-end AUM of $741.0B, up from $740.0B as of March 31 and $747.1B as of April 30 2016
  • Cohen & Steers, Inc. (CNS) prelim AUM $59.2Bn as of April 30, 2017, an increase of $696M MoM saying increase was due to market appreciation of $584M and net inflows of $470M partially offset by distributions of $358M
  • Cubic (CUB) Q2 EPS 2c/$343.7M vs. est. 4c/$365.04M; cuts FY17 revenue view to $1.5B-$1.54B from $1.505B-$1.555B; says withdrew EPS guidance
  • Brookdale (BKD) Q1 revs $1.22B vs. est. $1.21B; Q1 adjusted Ebitda $198.3M
  • Guaranty Bancshares (GNTY) 2M share IPO priced at $27.00
  • Gladstone Investment (GAIN) priced 2.6M shares at $9.38 each
  • Premier (PINC) Q3 EPS 52c/$379.8M vs. est. 50c/$401.91M; raises FY17 adjusted EPS view to $1.89-$1.94 from $1.80-$1.93 but cuts FY17 revenue view to $1.43B-$1.47B from $1.48B-$1.56B
  • Pzena Investment (PZN) reports preliminary April AUM $32.3B
  • Spirit Realty Capital (SRC) announces departure of Chairman and CEO Thomas Nolan amid tenant credit concerns highlighted by weak 1Q results
  • Preferred Apartment (APTS) files to sell 2.75M shares of common stock

Healthcare

  • Diplomat Pharmacy (DPLO) Q1 EPS 19c/$1.079B vs. est. 15c/$1.08B; sees FY revenue $4.3B-$4.7B vs. est. $4.53B; sees year EPS 54c-70c vs. est. 64c
  • Insulet (PODD) Q1 EPS (17c)/$101.7M vs. est. loss (15c)/$97.83M; raises FY17 revenue view to $425M-$440M from $420M-$440M
  • Nevro (NVRO) Q1 EPS loss (50c)/$68.4M vs. est. loss (25c)/$68.71M
  • Phibro Animal (PAHC) Q3 EPS 37c/$189.9M vs. est. 34c/$186M; sees FY net sales $760M-$765M vs. est. $757M and sees FYEPS $1.44-$1.47 vs. est. $1.43
  • Scynexis (SCYX) says that following recent FDA meeting on the SCY-078 clinical hold, it plans to submit a comprehensive analysis of data from preclinical and clinical studies.
  • Teladoc (TDOC) Q1 EPS loss (30c)/$42.9M vs. est. loss (34c)/$42.22M; sees FY17 EPS (91c)-(85c), on revs $180M-$185M vs. es.t loss (88c)/$182.75M
  • Accelerate Diagnostics (AXDX) files to sell 2.5M shares of common stock
  • Novavax (NVAX) Q1 EPS loss (16c)/$5.7M vs. est. loss (17c)/$6.17M
  • Rosetta Genomics (ROSG) files to sell 7.5M shares and warrants

Industrials & Materials

  • S. activist investor Elliott Management Corp. has asked a Dutch court to force Akzo Nobel NV to hold a special shareholder meeting seeking the removal of its chairman, its latest attempt to force the paint maker into sale talks with rival PPG Industries Inc. (PPG)
  • Chicago Bridge & Iron (CBI) falls 7% after cutting its 2017 EPS view following a 91% YoY drop in 1Q E&C segment’s adjusted income from operations; says 1Q E&C segment earnings hurt by underperformance on two union construction projects; announces $3.3B in new awards in Q1
  • United Airlines (UAL) April consolidated traffic increased 7.4% and consolidated capacity increased 4.0% versus April 2016. UAL’s April consolidated load factor increased 2.6 points compared to April 2016
  • Model N (MODN) Q2 EPS loss (25c)/$33.3M vs. est. loss (27c)/$33.84M; raises FY17 adjusted EPS view to (68c)-(66c) from (69c)-(66c) and Cuts FY17 revenue view to $129.4M-$130M from $130M-$134M (est. $132.3M)
  • Genesee & Wyoming (GWR) traffic in April 2017 was 260,440 carloads, an increase of 30,468 carloads, or 13.2%, compared with April 2016. G&W’s same-railroad traffic in April 2017 was 225,232 carloads, a decrease of 4,740 carloads, or 2.1%, compared with April 2016
  • MTS Systems (MTSC) Q2 EPS 67c/$193.4M vs. est. 521c/$185.7M; reaffirms year view
  • Regal Beloit (RBC) Q1 EPS $1.07/$813.5M vs. est. 95c/$807.25M; raises FY17 adjusted EPS view to $4.55-$4.95 from $4.50-$4.90 (est. $4.72)
  • Sykes Enterprises (SYKE) Q1 EPS 54c/$384M vs. est. 40c/$383m; sees 2Q revenue $374.0M-$379.0M vs. est. $388.0M and EPS 30c-33c vs. est. 40c; boosts year outlook
  • Valvoline (VVV) will join the mid-cap index and Noble (NE) will replace Celadon (CGI) in S&P SmallCap 600 before the open May 16
  • Glencore PLC (GLNCY) reversed plans to close an Australian coal mine, putting it up for sale instead in a bid to benefit from the recovery in coal prices.

Media & Telecom

  • AMC Entertainment (AMC) Q1 EPS 7c/$1.283B vs. est. 7c/$1.25B; Q1 admissions revenues increased 69.4% to $817.3M compared to $482.6Mfor the same period a year ago. Food and beverage revenues increased 63.0% to $397.9M

Technology

  • Pandora (P) Q1 EPS loss (24c)/$316M vs. est. loss (34c)/$318.15M; Q1 subscription revenue $64.9M, up 19%; reports Q1 ticketing service revenue $27.8M, up 25%; Q1 ad RPMs $50.87, up 12%; sees Q2 revenue $360M-$375M vs. est. $390.8M; cuts FY17 revenue view to $1.5B-$1.65B from $1.55B-$1.7B; 1Q active listeners 76.7M
  • Convergys (CVG) Q1 EPS 52c/$728M vs. est. 45c/$719.96M; boosts dividend; backs FY17 adjusted EPS growth view (3%)-3% & backs FY17 constant currency revenue growth view (3%)-1%
  • Fabrinet (FN) Q3 EPS 80c/$366.8M vs. est. 88c/$362.63M; sees Q4 EPS 82c-84c on revs $361M-$365M vs. est. 88c/$373.28M
  • MaxLinear Inc. (MXL) will replace Exar Corp. (EXAR) in the S&P SmallCap 600 effective prior to the open on Monday, May 15
  • Meet Group (MEET) Q1 EPS 7c/$20.1M vs. est. 7c/$20.05M
  • Open Text (OTEX) fell over 10% as CEO says revenue miss was related to timing of January acquisition of Dell’s Enterprise Content Division; missed lowest analyst EPS estimate
  • j2 Global (JCOM) shares fall; Q1 EPS $1.19/$254.7M vs. est. $1.23/$257.5M; Reiterates FY17 guidance of EPS $5.60-$6.00 and revs $1.13B-$1.17B

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

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