Early Look

Wednesday, August 5, 2020

Futures	Up/Down	%	Last
DJ Industrials	187.00	0.70%	26,904
S&P 500	17.50	0.52%	3,317
Nasdaq	34.50	0.31%	11,120

 

 

Stock futures remain on cruise control higher along with gold (new record highs), as spot gold rose as much as 0.6% to a record $2,031.14 per ounce, while futures traded as high as $2,048.60 on the Comex. Spot silver advanced as much as 1.3% to $26.3473 an ounce. Global stocks markets have been on an absolute tear given improved on earnings, economic data, hopes of a vaccine and now news overnight that the U.S. and China agreed to high-level talks on Aug. 15 to assess Beijing’s compliance with the bilateral trade agreement signed early this year. In Asian markets, The Nikkei Index fell -58 points to 22,514, the Shanghai Index rose 5 points to 3,377 and the Hang Seng Index rose 155 points to 25,102. In Europe, the German DAX is…while the FTSE 100 is up over 70 points to move above the 6,100 level and the German Dax jumps about 130 points to 12,730. The Nasdaq Composite closed at a fresh record high (30^th time this year) on Tuesday, rising for a 5^th consecutive session as earnings season rolls on, while the S&P 500 index ends above the 3,300 level as beaten down financials, real estate and consumer staples outperformed. Not much to explain the surge in stocks to all-time highs other than euphoric optimism and the fact that the path of least resistance remains firmly to the upside. Even oil prices are higher by over 2%, moving back above its best levels in 4-months. Based on the stock market performance, not one would know we remain in a global pandemic.

Market Closing Prices Yesterday

·     The S&P 500 Index gained 11.90 points, or 0.36%, to 3,306.51

·     The Dow Jones Industrial Average rose 164.07 points, or 0.62%, to 26,828.47

·     The Nasdaq Composite climbed 38.37 points, or 0.35%, to 10,941.17

·     The Russell 2000 Index advanced 10.41 points, or 0.69% to 1,517.21

 

Economic Calendar for Today

·     7:00 AM EST      MBA Mortgage Applications Data

·     8:15 AM EST      ADP Employment Change for July

·     9:45 AM EST      Markit Composite PMI, July-F

·     9:45 AM EST      Markit Services PMI, July-F

·     10:00 AM EST    ISM Non-Manufacturing Index for July

·     10:30 AM EST    Weekly DOE Inventory Data

 

Earnings Calendar:

·     Earnings Before the Open: ABC, BWA, CDW, CIM, CRL, CVS, DISCA, ELF, ENR, EVRG, FUN, GOLD, HSC, HUM, HZNP, KAR, LL, MRNA, MTG, NI, NLSN, NXST, NYT, ODP, REGN, SBGI, SONO, SRE, SRPT, SSYS, VCEL, W, WATT, WEN, WWW

·     Earnings After the Close: ACAD, ADMA, ADT, ADTN, ALB, ALRM, APPS, ARLO, ARNA, ATO, AUTO, AWK, CCMP, CDAY, CENX, CF, CHNG, CTL, CVNA, CWH, DDD, DOX, ET, ETSY, FISV, FIT, FSLY, GBT, GDDY, HR, HT, HUBS, IMMU, INFN, INSG, LNC, LYV, MAXR, MBI, MET, MRO, NUS, NUAN, NYMT, OHI, OLN, OSUR, PE, RMD, ROKU, SKT, SPWR, SQ, SYNA, TVTY, TWNK, TWO, VAR, VOYA, WDC, WMC, XRC, ZGNX, ZNGA

 

 

Macro	Up/Down	Last
WTI Crude	1.11	42.81
Brent	1.08	45.51
Gold	35.60	2,056
EUR/USD	0.0049	1.1852
JPY/USD	0.04	105.76
10-Year Note	+0.021	0.526%

 

 

Sector News Breakdown

Consumer

·     Beyond Meat (BYND) Q2 EPS loss (2c) on revs $113.3M vs. est. loss (4c)/$78.94M; Q2 adjusted gross profit of $39.6M, or adjusted gross margin of 34.9% of net revenues, reflecting exclusion of expenses attributable to COVID-19; 2020 outlook remains suspended

·     Ethan Allen (ETH) Q4 adjusted EPS loss (15c) on revs $91.6M vs. est. loss (54c)/$95.17M

·     Grand Canyon (LOPE) Q2 adjusted EPS $1.03/$185.5M vs. est. 89c/$179.86M; end-of-period enrollment in the programs at University partners for which the company provides services increased 8.2% between June 30, 2020 and June 30, 2019 to 98,326 from 90,906; sees Q3 adjusted EPS $1.11 on revs $197.5M vs. est. $1.26/$204.45M

·     Monster Beverage (MNST) Q2 EPS 59c on revs $1.09B vs. est. 49c/$1.01B; does not foresee a material impact on the ability of its co-packers to manufacture and its bottlers/distributors to distribute its products as a result of the COVID-19 pandemic

·     Nikola (NKLA) Q2 EPS loss (33c) vs. est. loss (13c); reports Q2 revenue $36,000; said met predetermined milestones on our journey toward becoming the zero-emissions transportation leader in the global heavy truck market; said on July 23, 2020, Nikola broke ground on its greenfield manufacturing facility in Coolidge, Arizona

·     Planet Fitness (PLNT) Q2 EPS loss (32c) on revs $40.2M vs. est. loss (16c)/$38.12M; said it is currently not providing guidance

·     Red Rock Resorts (RRR) Q2 EPS loss ($1.01) on revs $108.5M vs. est. loss ($1.07)/$73.63M; as compared to the same period in the prior year, net revenues decreased 23.3%, Adjusted EBITDA increased 46.8% and Adjusted EBITDA margin increased 2,192 basis points to 45.9%

·     WW Inc. (WW) Q2 EPS 67c/$334M vs. est. 70c/$340M; reports Q2 end of period subscribers up 9% year-over-year to 5.0M, an all-time Q2-end high; reports Q2 end of period digital subscribers up 23% year-over-year and at all-time high

·     Wynn Resorts (WYNN) Q2 adjusted EPS loss ($6.14) on revs $85.7M vs. est. loss ($4.98) and $212.17M;

 

Energy

·     Callon Petroleum (CPE) Q2 adj EPS 1c on revs $157.23M vs. est. loss 5c/$196.58M; delivered production of approximately 108.7 Mboe/d in Q2, above the high end of guidance

·     Devon Energy (DVN) Q2 EPS loss (18c) vs. est. loss (26c); raises oil production outlook to 148-152 MBOD; plans to use cash on hand to repurchase up to $1.5B of additional debt

·     Plains All American (PAA) Q2 adjusted EPS 25c/$3.23B vs. est. 28c/$6.66B; raises FY20 adj. EPS view to $1.88-$2.51 from $1.44 prior

·     Pioneer Natural (PXD) Q2 EPS loss (32c) on revs $859M vs. est. loss (35c)/$691.14M; the company averaged Q2 oil production of 215 thousand barrels of oil per day, production of 375 thousand barrels of oil equivalent per; initiating a long-term investment framework that is underpinned by a cash flow reinvestment rate between 70% to 80%

 

Financials

·     Square (SQ) Q2 adjusted EPS 18c on revs $1.92B vs. est. .loss (5c)/$1.13B; reports Q2 gross payment volume up 15% year-over-year to $22.8B; posted a gross profit up 167% year-over-year to $281M; Square’s Seller ecosystem generated gross profit of $316M, down 9% year-over-year

·     Allstate (ALL) Q2 adjusted EPS $2.46 vs. est. $1.55; reports Q2 revenue $11.2B vs. est. $9.04B;

·     Avalara (AVLR) Q2 adjusted EPS 4c on revs $116.5M vs. est. loss (10c)/$110.36M; sees FY20 revenue $465M-$470M vs. est.$460.24M; sees FY20 adjusted operating loss $16M-$20M

·     EverQuote (EVER) Q2 EPS loss (10c) on revs $78.3M vs. est. loss (4c)/$78.94M; sees Q3 revenue $84M-$86M vs. est. $81.42M; sees Q3 adjusted EBITDA of $4.0M-$5.0M

·     Green Dot (GDOT) Q2 adjusted EPS 43c/$316.2M vs. est. 32c/$237.71M

·     Prudential (PRU) Q2 adjusted EPS $1.85 vs. est. $1.71; said remain on track to achieve our targeted $140 million of cost savings for the year and are making progress in transitioning our international earnings base to higher-growth markets

·     Western Union (WU) Q2 EPS 39c on revs $1.11B vs. est. 35c/$1.08B; digital money transfer revenue grew 48% year-over-year, or 50% on a constant currency basis, to a record high of $219 million for the second quarter

 

Healthcare

·     Teladoc (TDOC) and Livongo Health (LVGO) agree to merge in a deal valued at $18.5B in the telehealth sector; LVGO holders to receive 0.592 shares of TDOC plus $11.33 per share in cash https://on.mktw.net/33uRPnM

·     Acorda Therapeutics (ACOR) Q2 EPS loss (37c)/$33.6M vs. est. loss (48c)/$27.4M; continues to expect AMPYRA net revenue to be $85M-$110M and operating expenses to be $170M-$180M

·     BioMarin (BMRN) Q2 EPS loss (16c) on revs $429.49M vs. est. loss (11c)/$418.61M

·     Evolent Health (EVH) Q2 adjusted EPS loss (3c) on revs $238.6M vs. est. loss (10c)/$241.03M; total cash and cash equivalents and investments as of June 30, was $115.2M

·     Jazz Pharmaceuticals (JAZZ) Q2 EPS $2.06 on revenue $562.44M vs. est. $3.11/$504.65M; said with the strong performance of Xyrem and the recent FDA approval of Xywav, well-positioned to ensure the durability and growth of our oxybate business with differentiated product; sees FY20 adj. EPS $11.90-$13.00 vs. est. $11.73 and raises FY20 revenue view to $2.23B-$2.33B from $2.12B-$2.26B (est. $2.2B)

·     Luminex (LMNX) Q2 EPS 27c/$109.5M vs. est. 8c/$107.33M; said delivered record revenue, the most profitable quarter in the history of our company and a significant amount of cash flow; said is increasing our revenue guidance as a result of overachieving our original expectations; sees Q3 revenue at or above $100M vs. est. $89.47M

·     Novavax (NVAX) announced Phase 1 data from its Phase 1/2 randomized, observer-blinded, placebo-controlled trial of its COVID-19 vaccine with and without Matrix-M adjuvant in healthy adults 18-59 years of age

·     NuVasive (NUVA) Q2 non-GAAP EPS loss (40c) on revs $203.6M vs. est. loss (47c)/$175.79M;

·     Rigel Pharmaceuticals (RIGL) Q2 EPS loss (10c)/$16.0M vs. est. loss (13c)/$13.75M; as of June 30 Rigel, had cash, cash equivalents and short-term investments of $92.5M, compared to $98.1M as of December 31, 2019

·     Thermo Fisher Scientific (TMO) confirmed that its offer to acquire all of QIAGEN’s (QGEN) ordinary shares for an increased price of EUR43.00 per share in cash will expire at 18:00 hours, New York local time, on Monday, August 10; QGEN Q2 adjusted EPS 55c on revs $443.3M

 

Industrials & Materials

·     Allison Transmission (ALSN) Q2 EPS 20c vs. est. 17c and revenue $377M vs. est. $398.67M; reaffirms FY20 CapEx target of 35% lower than FY19

·     Compass Minerals (CMP) Q2 EPS 4c on revs $256.1M vs. est. loss (18c)/$246.09M; expect second-half 2020 Salt segment revenue and EBITDA to be similar to second-half 2019 results as an increase in expected sales volumes and lower production costs are projected to offset a year-over-year decline in highway de-icing prices

·     ICF International (ICFI) Q2 EPS 89c/$353.99M above est. 72c/$350.45M; said Q2 service revenue increased 3.5% YoY and 2.3% sequentially, led by our federal government and commercial energy businesses; favorable business mix, higher utilization and lower G&A costs drove a 3.7% YoY increase in EBITDA and sequential increases of 30.9% in GAAP EPS, 7.2% in Non-GAAP EPS; reaffirms year profit and sales outlook

·     Kratos Defense (KTOS) Q2 EPS 8c/$170.4M vs. est. 6c/$165.18M; sees Q3 revenue $195M-$205M vs. est. $197.35M; boosts FY20 revenue view to $740M-$780M from $720M-$760M

·     Triumph Group (TGI) Q2 EPS loss (19c) on revs $495.08M vs. est. loss (22c)/$459.68M; said for the first quarter of our fiscal year, organic revenue decreased by 29%; sees FY21 revenue $1.8B-$1.9B vs. consensus $1.97B

 

Media & Telecom

·     Disney (DIS) Q3 adj EPS 8c on revs $11.78B vs. est. loss (64c)/$12.39M; said global reach of our full portfolio of direct-to-consumer services now exceeds an astounding 100 million paid subscriptions — a significant milestone and a reaffirmation of our DTC strategy; Q3 Media Networks revenue $6.52B vs. $6.71B last year; Q3 Parks, Experiences and Products revenue $983M vs. $6.58B last year; Q3 Cable Networks revenue down 10% to $4.0B; said it will put Mulan out on Disney Plus in the U.S. and other markets Sept. 4^th at a premium access price of $29.99 in the U.S., varying slightly in other countries.

·     Fox Corp. (FOXA) Q4 adj EPS 62c on revs $2.42B vs. est. 57c/$2.4B

·     Match Group (MTCH) Q2 EPS 51c/$555.45M vs. est. 43c/$537.06M; sees Q3 revenue at least $600M vs. est. $574.97M

 

Technology

·     Activision Blizzard (ATVI) Q2 EPS 81c/$1.93B vs. est. 68c/$1.70B; said Q2 net bookings were $2.08B, as compared with $1.2B last year and net bookings from digital channels were $1.82B, as compared with $1.01B last year; overall Activision Blizzard monthly active users were 428M; sees Q3 EPS 75c on revs $1.8B vs. est. 41c/$1.39B

·     Arista Networks (ANET) Q2 EPS $2.11/$540.6M vs. est. $1.95/$529.73M; sees Q3 revenue $570M-$590M vs. est. $562.24M; sees Q3 non-GAAP gross margin of 63% to 65%

·     Coherent (COHR) Q3 EPS 52c/$298.3M vs. est. 21c/$287.69M; sees Q4 revenue $290M-$320M, vs. consensus $325.49M and sees Q4 non-GAAP gross margin of 34.5%-38.5%

·     Glu Mobile (GLUU) Q2 EPS loss (5c) vs. est. 8c; reports Q2 net bookings $182M vs. est. $165.3M; said saw record quarterly bookings in all three of our Growth Games and the continued resurgence of Kim Kardashian: Hollywood and Diner DASH Adventures; raises FY20 bookings view to $538M-$548M from $490M-$500M

·     Microchip (MCHP) Q1 EPS $1.56 vs. est. $1.43 and revenue $1.31B vs. est. $1.28B; reports Q1 non-GAAP gross margin of 61.7%, operating income of $505.2M and 38.6% of net sales; sees Q2 EPS $1.30-$1.52 vs. est. $1.42 and revs $1.205B-$1.31B vs. est. $1.27B

·     NeoPhotonics (NPTN) Q2 adjusted EPS 16c on revs $103.2M vs. est. 12c/$99.5M; sees Q3 adjusted EPS 3c-13c on revs $97M-$105M vs. est. 11c/$98.31M

·     Twilio (TWLO) Q2 adjusted EPS 9c on revs $400.8M vs. est. loss (9c)/$368.23M; reports more than 200,000 Active Customer Accounts as of June 30, 2020, up 24% year-over-year; sees Q3 adjusted EPS loss (9c)-(5c) on revs $401M-$406M vs. est. loss (6c)/$379.03M

·     Unisys (UIS) Q2 non-GAAP EPS loss (15c) on revs $438.8M vs. est. loss (7c)/$460.27M; said revenue expectations are unchanged for FY20 and we now have enough visibility to provide profitability expectations for the year; reaffirms FY20 revenue view down 10% from last year

·     Verisk Analytics (VRSK) Q2 EPS $1.08 on revs $679Mvs.est. $1.19/$686M; delivered organic constant currency adjusted EBITDA growth of 12.4%, demonstrating strong operating leverage despite reduced revenue growth this quarter due to the impact of COVID-19