Morning Preview: December 03, 2021

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Early Look

Friday, December 3, 2021









S&P 500










U.S. futures are looking down slightly but have been paring losses in a volatile trading week dominated by concerns over rising interest rates and inflation as well as the potential global impact of the Omicron variant that sparked the biggest two-day declines on Wall Street in more than a year this week. Futures edge lower ahead of a key monthly jobs report expected later this morning, with ests for +550K nonfarm, +530K private and +45K manufacturing jobs; unemployment rate expected to dip to 4.5% from 4.6% prior and average hourly earnings forecast to rise +0.4% MoM and up +5% YoY. A strong report could raise prospects of faster rate hikes, while a weaker one could help market sentiment. In Asian markets, The Nikkei Index jumped 1% to end the week at 28,029, the Shanghai Index also rose nearly 1% to settle at 3,607, and the Hang Seng Index slipped -22 points to 23,766. In Europe, the German DAX is higher by 0.1% to 15,280, while the FTSE 100 gains 0.2% to 7.145.


Market Closing Prices Yesterday

·     The S&P 500 Index gained 64.06 points, or 1.42%, to 4,577.10

·     The Dow Jones Industrial Average rose 617.75 points, or 1.82%, to 34,639.79

·     The Nasdaq Composite spiked 127.27 points, or 0.83%, to 15,381.32

·     The Russell 2000 Index advanced 58.91 points, or 2.74% to 2,206.33


Events Calendar for Today

·     8:30 AM ET          Non-Farm Payrolls for November…est. +550K

·     8:30 AM ET          Private Payrolls for November…est. +530K

·     8:30 AM ET          Manufacturing Payrolls for November…est. +45K

·     8:30 AM ET          Unemployment Rate for Nov…est. 4.5%

·     8:30 AM ET          Average Hourly Earnings for Nov…est. +0.4%

·     9:45 AM ET          Markit Composite PMI Nov-F

·     9:45 AM ET          Markit Services PMI, Nov-F

·     10:00 AM ET       Factory Orders MoM for October…est. +0.5%

·     1:00 PM EST       Baker Hughes Weekly rig count data


Earnings Calendar:

·     Earnings Before the Open: AIRS, BIG, GCO, HIBB


Other Key Events:

·     Cowen 2021 Energy Summit (virtual), 12/1-12/3

·     Credit Suisse 9th Annual Industrials Conference, 12/1-12/3, in Florida

·     Morgan Stanley Nasdaq Investor Conference (virtual), 11/30-12/3

·     Stephens Annual Investment Conference, in Nashville, TN, 12/1-12/3





















10-Year Note





World News

·     China’s foreign exchange regulator issued guidelines on foreign exchange trading on Friday, targeting market manipulation, fraud, and abuses. The guidelines would help regulate foreign exchange market trading and promote “honest, fair, orderly and efficient” market operations, the State Administration of Foreign Exchange said.

·     China Nov Services PMI: 52.1 vs 53.8 previous; Japan Nov Services PMI: 53.0 vs 50.7 previous

·     Euro PMIs: Spain Nov Services PMI: 59.8 vs 58.8 consensus; Italy Nov Services PMI: 55.9 vs 54.8 consensus; France Nov Services PMI: 58.2 consensus; Germany Nov Services PMI: 52.7 vs 53.4 consensus; Eurozone Nov Services PMI: 56.6 consensus

·     Fed’s Mester said: Omicron variant is threatening to fuel increasing US inflation, the variant could also worsen a supply chain crunch & worker shortage, fears about the virus is one of reasons stopping people returning to work, we have to consider the risk that persistently high inflation could become more embedded, the economy has got better at dealing with Covid variants, demand side effects have lessened but these supply side effects are related to the virus , she would support at least one rate hike next year & 2 increases might be appropriate


Sector News Breakdown


·     Big Lots (BIG) Q3 EPS loss (-$0.14) vs. est. loss (-$01.6); Q3 revs $1.34B vs. est. $1.32B; Q3 Comparable sales fell 4.7% compared with the 17.8% increase it reported last year; cuts FY21 EPS view to $5.70-$5.85 from $5.90-$6.05 (est. $5.97)

·     Didi Global (DIDI) said it plans to withdraw from the New York stock exchange and pursue a Hong Kong listing; shares jumped initially as investors bet the move would appease Beijing and serve as a catalyst for a revival of its business prospects at home.

·     Hibbett Sports (HIBB) Q3 EPS $1.68 vs. est. $1.57; Q3 revs $381.7M vs. est. $360.63M; compared to the 13-week period ended October 31, 2020, comparable sales increased 13.0%, as brick and mortar comp; raises FY22 GAAP EPS view to $11.70-$11.90 from $11.00-$11.50

·     Joann Stores (JOAN) 3Q adj EPS $0.73 vs est. $0.62 on revs $611Mm vs est. $619.6Mm, comps -14.2%; said because of proactive measures taken, we have enjoyed a very strong fall seasonal business and have robust holiday assortments ready to support our key fourth quarter customer demand

·     Ollie’s Bargain Outlet Holdings, Inc. (OLLI) 3Q adj EPS $0.34 vs est. $0.47 on revs $383.5Mm vs est. $415.1Mm; guides FY sales $1.762-1.772B vs est. $1.833B; authorizes additional $200M in buybacks

·     Smith & Wesson (SWBI) shares fall -18%; Q2 EPS $1.13 vs. est. $1.29; Q2 sales fell -7.3% to $230.5M vs. est. $265M; sees FY revenue $544M-$545M up from prior $530M-$533M (est. $534.4M) and smaller EPS loss for year; Q2 gross margin 44.3% vs. 40.6% last year

·     Tilly’s (TLYS) Q3 EPS $0.66 vs. est. $0.33; Q3 revs rose 46.9% to $206M vs. est. $190M; guides Q4 EPS $0.42-$0.50 vs. est. $0.35 and revs $210M-$215M vs. est. $197.2M; plans to open 15-20 new stores in 2022; posts Q3 comp sales rise 27.4%

·     Ulta Beauty (ULTA) 3Q EPS $3.94 vs est. $2.46 on sales $2.0B vs est. $1.9B, comps +25.8%; guides FY comps +36-37% above prior view 30%-32%, sees FY EPS $16.70-17.10 vs est. $15.19 and sales $8.5-8.6BN vs est. $8.4B; gross margin rises to nearly 40%, vs 35% last year & full 300bp above 2019.

·     Zillow Group, Inc. (Z and ZG) said it has made significant progress in winding down Zillow Offers inventory and has sold, is under contract to sell or has reached agreement on disposition terms for more than 50% of the homes it expected to resell during the entire wind-down process. Zillow Group’s Board of Directors has also authorized the repurchase of up to $750 million of its Class A common stock

·     Zumiez (ZUMZ) Q3 EPS $1.25 vs. est. $1.09; Q3 revs $289.46M vs. est. $290.81M; said total fourth quarter-to-date total sales for the 31 days ending November 30, 2021 increased 11.5%, compared with the same 31-day time period in the prior year ended December 1, 2020. Compared to the 31-day period ended December 3, 2019, total net sales increased 8.6%

·     National Beverage (FIZZ) announces $3.00 per share special dividend


Energy, Industrials and Materials

·     Patterson-UTI Energy (PTEN) reports an average of 106 drilling rigs operating for the month of November, 2021 in the US.

·     Maxeon Solar (MAXN) upgraded to Buy from Neutral with a $23 price target at Bank America



·     Axis Capital (AXS) authorizes $100M share buyback, raises quarterly dividend 2.4% to $0.43

·     Bank of Montreal (BMO) Q4 adjusted EPS C$3.33 vs. C$3.44 last year; reports Q4 revenue C$3.76B vs. C$3.52B last year. Reports CET1 capital ratio 13.7%; to repurchase up to 22.5M shares

·     Morgan Stanley (MS) upgraded to Buy from neutral and raise tgt to $115 from $105 at Citi

·     Raymond James Financial, Inc. (RJF) raised its quarterly cash dividend to $0.34 per share from $0.26; also authorized repurchase of the company’s shares of common stock in an aggregate amount of up to $1 billion

·     HIVE Blockchain Technologies (HIVE) reported $13.2M in November bitcoin mining revenue, 218 BTC produced and 2,334 ETH produced (equal in value to 171 BTC); it shows BTC HODL position of 1,584 coins as of today.



·     Janet Woodcock, a 35-year FDA veteran with outsized influence on the agency, is out of the running for the commissioner job. Yet, Robert Califf, President Biden’s pick to lead the FDA, wants her to stick around if he eventually wins Senate confirmation – STAT News

·     Cadre Holdings (CDRE) 3Q EPS ($0.19) vs est. ($0.18) on sales $98.7Mm vs est. $97.9Mm; Adjusted EBITDA margin of 15.6% for the third quarter; Adjusted EBITDA margin of 17.3% for the nine months ended September 30, 2021

·     Cooper Industries (COO) 4Q adj EPS $3.28 vs est. $3.37 on revs $759.1Mm vs est. $747.9Mm; guides FY22 revs $3.032-3.090B vs est. $3.093B, sees FY22 adj EPS $13.60-14.00 vs est. $14.49 (FY adj EPS guide does not include Generate Life Science acquisition)

·     Esperion (ESPR) 32.143M share Spot Secondary priced at $7.00

·     Longeveron (LGVN) rises after the FDA granted orphan designation to Lomecel-B, its allogeneic bone marrow-derived mesenchymal stromal cells, or MSCs, as a treatment of Hypoplastic Left Heart Syndrome.

·     Roche (RHHBY) and its newly acquired subsidiary TIB Molbiol said Friday that they have developed three new research test kits to differentiate mutations in the omicron variant of coronavirus that causes COVID.


Technology, Media & Telecom

·     Asana Inc. (ASAN) Q3 EPS loss (-$0.23) vs. est. loss (-$0.26); Q3 revs $100.3M vs. est. $93.86M; said Q3 was another strong quarter, led by record user adoption and large enterprise wins; sees Q4 EPS loss (28c)-(27c) vs. est. loss (27c); guides Q4 revs $104.5M-$105.5M vs. est. $98.74M; sees FY22 revenue $371M-$372M vs. est. $358.75M.

·     DocuSign (DOCU) shares tumble -30% as 3Q adj EPS $0.58 vs est. $0.46 on revs $545.5Mm vs est. $530.7Mm; guides 4Q revs $557-563Mm vs est. $573.8Mm and adj op margin 17-19%; sees FY revs $2.083-2.089B vs est. $2.086B and adj op margin 19-21%

·     Domo Inc. (DOMO) 3Q adj EPS ($0.32) vs est. ($0.34) on revs $65.1Mm vs est. $64.3Mm; guides 4Q adj EPS loss $0.37-0.41 vs est. loss $0.41, sees 4Q revs $66.5-67.5Mm vs est. $67.7Mm; guides FY adj EPS loss $1.26-1.30 vs est. loss $1.32

·     Guidewire Software (GWRE) 1Q adj EPS ($0.21) vs est. ($0.25) on revs $165.9Mm vs est. $164.8Mm; guides 2Q revs $195-199Mm vs est. $189.6Mm, sees FY revs $780-790Mm vs est. $786Mm

·     Marvell Technologies (MRVL) rises 10%; Q3 adj EPS $0.43 vs. est. $0.38; Q3 revs $1.21B vs. est. $1.15B; sees Q4 adj EPS $0.48 plus/minus 3c vs. est. $0.42; sees Q4 revs $1.32B plus/minus 3% vs. est. $1.21B; sees Q4 non-GAAP gross margin is expected to be approximately 65%; launches industry’s first 802.1AE MACsec integrated dual 1000BT1 and 100BT1 PHY automotive solutions

·     Ooma Inc. (OOMA) Q3 EPS $0.13 vs. est. $0.09; Q3 revs $49.2M vs. est. $48.0M; said revs 14% year-over-year, with key subscription services revenues increasing 24% for business customers and 4% for residential customers; subscription services revenues from business customers now represent 49% of total subscription services revenue; guides year EPS $0.47-$0.49 vs. est. %0.44 and revs $191.5M-$192M vs. est. $189.4M

·     Smartsheet (SMAR) Q3 adj EPS loss (-$0.03) vs. est. loss (-$0.10); Q3 revs $144.6M vs. est. $139.97M; sees Q4 adjusted EPS loss (16c)-(14c) vs. est. loss (14c); sees Q4 revenue $151M-$152M vs. est. $145.49M; raises year EPS and revenue outlook; number of all customers with annualized contract values (“ACV”) of $5,000 or more grew to 14,228, an increase of 27% year over year

·     Verint (VRNT) 3Q adj EPS $0.69 vs est. $0.53 on adj revs $227Mm vs est. $218Mm; guides FY22 adj revs $875Mm +/- 1% vs est. $871.6Mm and adj EPS $2.25 at midpoint vs est. $2.25; sees FY23 revs $935Mm +/-2% vs est. $927Mm and adj EPS $2.49 at midpoint vs est. $2.49;

·     Yext Inc. (YEXT) 3Q adj EPS ($0.04) vs est. ($0.07) on revs $99.5Mm vs est. $98.25Mm; guides 4Q revs $100-102Mm vs est. $99.15Mm and adj EPS loss $0.08-0.10 vs est. loss $0.07; guides FY revs $389.7-391.7Mm vs est. $387.4Mm, sees FY adj EPS loss $0.20-0.22 vs est. loss $0.22


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

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