Early Look

Tuesday, February 23, 2021

Futures	Up/Down	%	Last
Dow	-36.00	0.11%	31,430
S&P 500	-21.25	0.55%	3,852
Nasdaq	-210.50	1.59%	13,014

 

 

S&P futures are looking lower by about -0.6%, on track for its 6^th consecutive day of losses, while the tech heavy Nasdaq futures are down over 1.5% to 13,000, following its near 2.5% drop yesterday. Stocks have been pulling off all-time highs reached early last week as Treasury yields have been climbing along with inflation expectations, raising fear they could curb economic growth. Federal Reserve Chair Powell will appear in Congress on Tuesday to provide lawmakers an update on an economy. The hearing before the Senate Banking Committee, one of the Fed chief’s mandated twice-a-year appearances on Capitol Hill, is scheduled to begin at 10 a.m. EST (1400 GMT) and will be Powell’s first since Democrats won the White House and control of both chambers of Congress. Bitcoin prices tumble overnight, falling over 15% to below $47,000 (off yesterday record highs above $58,000), but still up 59% YTD. Stocks ended mixed on Monday as the Dow managed to eke out another small gain led behind strength in financials, energy and consumer through Disney strength, but the Nasdaq Composite plunged nearly 2.5% as surging Treasury yields raise fears of rising inflation, pressuring the case for the tech sector’s sky-high valuations. In Asian markets, The Nikkei Index rose 138 points to 30,156, the Shanghai Index fell -6 points to 3,636 and the Hang Seng Index jumped 312 points to 30,632. In Europe, the German DAX is down -185 points to 13,765, while the FTSE 100 is down about -30 points to 6,580. Investors have been rotating out the “stay-at-home” winners during the pandemic (SHOP, TDOC, ZM, PTON – down again this morning), and have been rotating into the “reopen” related names lately, such as leisure, airlines, hotels, casinos, restaurants, retailers, and theme parks.

Events Calendar for Today

·     7:45 AM ET         ICSC Weekly Retail Sales

·     8:55 AM ET         Johnson/Redbook Weekly Sales

·     9:00 AM EST      CaseShiller 20 Citi index for Dec

·     10:00 AM EST    Consumer Confidence for Feb…est. 90.0

·     10:00 AM EST    Richmond Fed Survey for Feb…prior 14

·     10:30 AM EST    Dallas Fed Manufacturing for Feb…prior 0.8

·     4:30 PM ET         API Weekly Inventory Data

 

Earnings Calendar:

·     Earnings Before the Open: AAN. ATRO, AWI, BCO, BLD, CBRE, CBRL, CMLS, CLVS, COOP, CROX, CTG, ECC, EPZM, ETRN, HD, HEP, LDOS, LGIH, M, MFA, NXST, RLGY, RUBY, SATS, SPR, WLK, WLKP

·     Earnings After the Close: ADMS, AGR, APLE, ARLO, ATNI, BRY, CDEV, CHE, CNFR, COG, CSGP, CSLT, DK, EQH, ESPR, FLS, GTY, HALO, HEI, HURN, HYLN, INFN, INN, INTU, MASI, MATX, MCFE, MTDR, MTG, MYGN, NBR, OSPN, PEB, PEN, PPD, PUMP, PXD, RRC, RRD, SQ, SUM, TOL, UPWK, VRSK, WES, XPER, Y

 

Other Key Events:

·     Baird Sustainability Conference (virtual), 2/23-2/24

·     Goldman Sachs Insurtech Conference (virtual), 2/22-2/23

·     KBW Inc. Payments FinTech Conference (virtual), 2/23-2/25

·     SVB Leerink Global Healthcare Conference (virtual), 2/22-2/26

 

Market Closing Prices Yesterday

·     The S&P 500 Index slumped -30.21 points, or 0.77%, to 3,876.50

·     The Dow Jones Industrial Average rose 27.37 points, or 0.09%, to 31,521.69

·     The Nasdaq Composite plunged -341.42 points, or 2.46%, to 13,533.05

·     The Russell 2000 Index declined -15.62 points, or 0.69% to 2,251.07

 

 

Macro	Up/Down	Last
Nymex	0.45	62.15
Brent	0.50	65.74
Gold	-2.00	1,807.75
EUR/USD	-0.0009	1.2148
JPY/USD	0.22	105.30
10-Year Note	-0.007	1.362%

 

 

Sector News Breakdown

Consumer

·     Home Depot (HD) Q4 EPS $2.65 vs. est. $2.62; Q4 revenue $32.26B vs. est. $30.73B; Q4 comp sales increased 24.5% (vs. est. 19.2%) and comparable sales in the U.S. increased 25% (vs. est. 20.9%); increases quarterly dividend 10% to $1.65 per share; said it was not providing full-year financial guidance given uncertainties resulting from the COVID-19 pandemic.

·     Carnival (CCL) 40.45M share Spot Secondary priced at $25.10

·     Armstrong World (AWI) Q4 adj EPS 77c vs. est. 67c; Q4 revenue $238.7M vs. est. $231M

·     Lucid Motors on Monday agreed to go public by merging with blank-check firm Churchill Capital IV Corp (CCIV) in a deal that valued the combined company at $11.75 billion, in a highly anticipated and well telegraphed deal

·     Carnival Corp. (CCL) announces public offering of $1 billion shares of common stock

·     Dillard’s (DDS) Q4 EPS $3.05 vs. est. $2.79; Q4 revenue $1.57B vs. est. $1.65B; Q4 comp store sales fell (-17%); retail gross margin improved 171 basis points of sales; inventory decreased approximately 26%; operating expenses decreased $122.8 million

·     Freshpet (FRPT) files to sell $300M in common stock

·     Nautilus (NLS) 4Q EPS $0.90 vs. est. $0.75 on revs $189.3Mm vs. est. $191.7Mm; guides FY21 revs $553Mm vs. est. $553Mm

·     RealReal (REAL) Q4 EPS loss (49c) vs. est. loss (41c); Q4 revenue $84.59M vs. est. $94.06M; Q4 gross merchandise volume was $301.2M; said with improving trends in Q4, culminating in December GMV increasing 6% Y/Y, we exited the year with strong momentum; sees Q1 gross merchandise volume $301M-$310M

·     Trex Company (TREX) Q4 EPS 37c vs. est. 36c; Q4 revenue $228.3M vs. est. $215.9M; sees Q1 revenue $235M-$245M vs. est. $237.5M; expect full year spending on cap expenditures to be in range of $130M-$150M

 

Energy

·     Cimarex Energy (XEC) Q4 EPS 89c vs. est. 68c; Q4 revenue $434.72M vs. est. $419.66M; intends to invest $500-600m on the drilling and completion of wells in 2021 with 73 net wells expected to begin producing during the period; Oil production in the first quarter of 2021 is expected to average 65-69 Mbls per day; Q1 total production is expected to average 205 – 225 MBOE per day

·     Diamondback Energy (FANG) Q4 EPS 82c vs. $1.93 y/y and estimate 83c; Q4 adj Ebitda $475 million, -43% y/y, missing estimate $530.9M; average realized price crude oil equivalent per Boe $27.41, -30% y/y

·     Laredo Petroleum (LPI) Q4 EPS $3.22 vs. est. $3.18; Q4 revenue $188.1M vs. est. $187.76M; Q4 total production averaged 82,552 BOE per day, including oil production of 21,929 BOPD

·     Marathon Oil (MRO) Q4 adj EPS loss (12c) vs. est. loss (20c); q4 and full year total company oil production of 172,000 net bopd and 190,000 net bopd, both at guidance midpoint; $3.7 bln of liquidity at year-end; says won’t raise our level of spending even if recent commodity price strength persists; U.S. production averaged 280,000 net barrels of oil equivalent per day (boed) for q4 2020

·     Occidental Petroleum (OXY) Q4 adj loss (78c) vs. est. loss (58c); Q4 Production of 1,143 MBoed from continuing operations, exceeding midpoint of guidance by 13 MBoed; Permian Resources exceeded high-end of guidance, producing 382 MBoed; qtrly average worldwide realized crude oil prices increased by approximately 5% from prior quarter to $40.77 per barrel

·     ONEOK (OKE) Q4 EPS 69c below est. 73c; sees year EPS $2.40-$3.08 vs. est. $3.03; sees a 12% increase of adjusted EBITDA midpoint for FY21 to $3.05B; sees a more than 70% decrease of total capital expenditures to a midpoint of $600M

·     Transocean (RIG) Q4 EPS loss (6c) vs. est. loss (19c); Q4 revenue $690M vs. est. $699.08M; Adjusted EBITDA was $210 million, compared with adjusted EBITDA of $338 million prior quarter; contract backlog was $7.8 billion as of the February 2021 Fleet Status Report.

·     William Energy (WMB) Q4 adj EPS 31c (in-line w ests); Q4 adjusted EBITDA of $1.336B, up $52M or 4% over 4Q ’19; expects 2021 adjusted EBITDA between $5.05B and $5.35B; expects 2021 growth capex between $1B to $1.2B and leverage ratio of 4.25x

 

Financials

·     American Campus (ACC) 4Q adj FFO/shr $0.59 vs. est. $0.54 on revs $233Mm vs. est. $215.3Mm; guides 1Q FFO/shr $0.56-0.58 vs. est. $0.55

·     EverQuote (EVER) 4Q EPS ($0.13) vs. est. ($0.15) on revs $97.3Mm vs. est. $91.8Mm; guides 1Q revs $100-102Mm vs. est. $100.07Mm, sees FY21 revs $430-440Mm vs. est. $415.3Mm

·     Green Dot (GDOT) 4Q adj EPS $0.31 vs. est. $0.18 on revs $284.3Mm vs. est. $257.6Mm; guides FY21 adj EPS $2.06-2.15 vs. est. $2.22, sees FY21 revs $1.23-1.25B vs. est. $1.236B

·     Life Storage (LSI) Q4 FFO $1.07 vs. est. $1.04; Q4 revenue $166.5M vs. est. $157.9M; Q4 same-store NOI up 6.8%; sees FY21 FFO $4.18-$4.28 vs. est. $4.30; sees FY21 same-store NOI 3.75%-4.75%

 

Healthcare

·     Johnson & Johnson (JNJ) set aside $3.9 billion in litigation expenses in 2020, which it said was “primarily associated with talc-related reserves and certain settlements”. The company faces 25,000 lawsuits by former users of its baby powder who say asbestos-laced talc in the product caused their cancers – Reuters

·     GenMark Diagnostics, Inc. (GNMK) announced that its ePlex Respiratory Pathogen Panel 2 (RP2) is predicted to detect known SARS-CoV-2 variants currently in circulation.

·     Revance (RVNC) announces positive topline phase 2 data supporting advancement of DaxibotulinumtoxinA for injection for the treatment of upper limb spasticity; data validated efficacy and safety and informs dosing strategy for Phase 3 program

·     Xenon Pharmaceuticals (XENE) announced that new pre-clinical data and a clinical overview of its XEN1101 program will be presented at ASENT 2021, the virtual annual meeting of the American Society for Experimental Neurotherapeutics

 

Industrials & Materials

·     Air Lease (AL) 4Q EPS $0.94 on revs $489Mm vs. est. $486.6Mm, took delivery of 10 aircraft from orderbook and purchased 14 aircraft from secondary market during 4Q; expects reduced sales activity in 2021, expects collection rate will remains under pressure from Covid impact; sees `majority’ of 737 max, some 787 delayed 12+ months

·     Boise Cascade (BCC) Q4 EPS 66c with items vs. est. $1.08; Q4 sales $1.5B vs. est. $1.34B

·     Nordson (NDSN) 1Q EPS $1.32 vs. est. $1.06 on sales $527Mm vs. est. $509.9Mm; guides FY sales about +4-6% vs. est. +5.6%, sees FY EPS $6.30-6.70 vs. est. $6.47

·     Republic Services (RSG) Q4 EPS $1.00 vs. est. $0.81; Q4 revs $2.57B, in-line with ests; sees year EPS $3.65-$3.73 vs. est. $3.70

·     Ingersoll Rand (IR) Q4 adjusted EPS 53c vs. est. 45c; Q4 revenue $1.5B vs. est. $1.46B; sees FY21 revenue growth high-single to low-double digits (est. $5.8B) and sees FY21 adjusted EBITDA $1.23B-$1.26B

·     Leidos (LDOS) Q4 EPS $1.63 vs. est. $1.61; Q4 revenue $3.25B vs. est. $3.39B; Q4 net bookings totaled $3.3B and $17.8B for FY20, representing a book-to-bill ratio of 1.0 and 1.4 respectively; sees FY21 EPS $6.15-$6.45 vs. est. $6.47; sees FY21 revenue $13.7B-$14.1B vs. est. $24.39B

 

Technology, Media & Telecom

·     BigCommerce (BIGC) Q4 EPS loss (12c) vs. est. loss (14c); Q4 revenue $43.14M vs. est. $38.6M; Q4 total annual revenue run-rate, or ARR, as of December 31, 2020 was $181.2M, up 41% compared to December 31, 2019; sees FY21 revenue $189M-$191M vs. est. $175.62M

·     Cadence Design Systems (CDNS) 4Q adj EPS $0.83 vs. est. $0.74 on revs $760Mm vs. est. $732Mm; guides 1Q revs $710-730Mm vs. est. $703.1Mm, sees 1Q adj EPS $0.72-0.76 vs. est. $0.71; guides FY revs $2.86-2.92B vs. est. $2.88, sees FY adj EPS $2.95-3.05 vs. est. $2.88

·     Dropbox Inc (DBX) offering privately $1.135 bln convertible debt deals equally split between 5-yr and 7-yr notes

·     Five9 Inc. (FIVN) Q4 adj EPS 34c vs. est. 23c; Q4 revenue $127.9M vs. est. $115.26M; sees Q1 adj EPS 12c-14c vs. est. 12c; sees Q1 revenue $122M-$123M vs. est. $115.75M; sees FY21 adjusted EPS 75c-79c vs. est. 84c; sees FY21 revenue $518.5M-$521.5M vs. est. $499.41M

·     Palo Alto Networks (PANW) 2Q adj EPS $1.55 vs. est. $1.43 on revs $1.0B vs. est. $985.7Mm; guides 3Q total billings $1.22-1.24B, sees 3Q adj EPS $1.27-1.29 vs. est. $1.28, sees 3Q total revs $1.05-1.06B vs. est. $1.045B; sees FY21 billings $5.13-5.18B, see FY adj EPS $5.80-5.90 vs. est. $5.81, sees FY total revs $4.15-4.20B vs. est. $4.124B

·     SBA Communications (SBAC) Q4 AFFO $2.49 vs. est. $2.44; Q4 revenue $536M vs. est. $528.96M; sees FY21 AFFO $10-$10.41 vs. est. $10.12 and sees FY21 revenue $2.172B-$2.212B vs. est. $2.19B

·     Shopify (SHOP) 1.18M share Spot Secondary priced at $1,315

·     Unisys (UIS) 4Q adj EPS $0.73 vs. est. $0.45 on revs $576.9Mm vs. est. $556.2Mm

·     ZoomInfo Tech (ZI) Q4 EPS 12c vs. est. 10c; Q4 revenue $139.7M vs. est. $130.32M; sees Q1 EPS 10c-11c vs. est. 10c; sees Q1 revenue $144M-$146M vs. est. $135.75M; closed the year with more than 20,000 customers, including more than 850 customers with $100,000 or greater in annual contract value