Early Look

Friday, March 11, 2022

Futures are snapping back this morning after a muted overnight move as Vladimir Putin said there were certain positive shifts in talks with Ukraine to send markets spiking within the past half hour. The United States Senate also passed a $1.5-trillion spending bill to fund the government through September and prevent a government shutdown. The spending includes more than $13B in aid to Ukraine but does not include any supplemental covid relief funds. Asian markets are mixed with the Nikkei Index slipping over 2% to 25,162 and the Hang Seng losing more than 1.6% to 20,553, though the Shanghai Index rose 0.4% above 3,300. In Europe, markets are getting a recent pop as well on Putin’s comments as the German DAX is up 3.5% above 13,900 while the FTSE 100 up nearly 2%, or 131 points to 7,230.

Market Closing Prices Yesterday

·     The S&P 500 Index slipped -18.48 points, or 0.34%, to 4,259.40

·     The Dow Jones Industrial Average fell -113.23 points, or 0.34%, to 33,173.02

·     The Nasdaq Composite dipped -125.58 points, or 0.95%, to 13,129.96

·     The Russell 2000 Index declined -4.61 points, or 0.230% to 2,011.68

Events Calendar for Today

·     10:00 AM ET                University of Michigan Sentiment, March-P

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

Earnings Calendar:

·     Earnings Before the Open: AIRS, BKE, GORO, PLXP, SPNE, WE

World News

·     The U.K. reported GDP growth of 0.8% in January vs December, the fastest monthly rise since June and well ahead of the expected 0.2% growth.

·     Ukraine’s two leading neon suppliers, Ingas and Cryoin, halted operations amid continued Russian attacks on the country. These two companies account for about half of the world’s neon supply.

Sector News Breakdown

Consumer

·     Ulta Beauty (ULTA) Q4 EPS $5.41 vs est. $4.58 on revenue $2.73B vs est. $2.17B, same-store sales 21.4%; approved a $2B share repurchase program; sees FY EPS $18.20-$18.70 vs est. $17.84 and sales $9.05B-$9.15B vs est. $9.14B, same-stores sales +3-4%

·     Tilly’s (TLYS) Q4 EPS 38c vs est. 41c on sales $204.5M vs est. $204M; sees Q1 sales $143M-$148M vs est. $166.2M

·     Zumies (ZUMZ) Q4 EPS $1.70 vs est. $1.76 on sales $346.7M vs est. $353.2M; quarter-to-date sales for Q1 through March 5 are -1.9% YoY and sees Q1 EPS 0c-10c vs est. 42c on sales $215M-$221M vs est. $258.2M

·     American Outdoor Brands (AOUT) 3Q adj EPS $0.52 vs est $0.46 on revs $70.1Mm vs est $72.6Mm; guides FY net sales $245-250Mm vs est $281.3Mm and adj EPS $1.65-1.78 vs est $2.06; shrs -7.4%; also announces Grilla Grills acquisition, expected to be immediately accretive to net sales and adj net Inc

·     Red Robin Gourmet Burgers (RRGB) Q4 EPS ($1.36) vs est. ($0.53) on revenue $283.4M vs est. $292.1M; expect to increase pricing in the mid-single digits in 2022 with mid-to-high single digit commodity and labor cost inflation; expects to achieve 2019 operating profit margin in 2023

·     Duckhorn Portfolio (NAPA) 2Q adj EPS $0.17 vs est $0.15 on sales $98.7Mm vs est $92.7Mm; guides FY adj EPS $0.55-0.58 vs est $0.58

·     Yum China (YUMC) warned it may have to delist from the New York stock exchange after U.S. authorities said it failed to provide access to audit documents.

Energy, Industrials & Materials

·     Rivian (RIVN) Q4 adj EPS ($2.43) vs est. ($1.97) on revenue $54M vs est. $60M, delivered 909 vehicles in the qtr; believe supply chain will fundamentally limit output throughout 2022 and that they have sufficient parts and materials to produce 25,000 vehicles in 2022; see FY22 adj EBITDA ($4.75B) vs est. ($3.724B) and expects to recognize negative gross margins throughout the year; as of March8, have produced 1,410 vehicles in 2022 and have ~83K pre-orders for its R1 in the U.S. and Canada

·     Shoals Technologies (SHLS) 4Q adj EPS $0.01 vs est $0.04 on revs $48Mm vs est $46.5Mm; guides 1Q revs $68-74Mm vs est $72.3Mm; opens new manufacturing facility to support growth, expected to be operational in 2Q22

Financials

·     Meridianlink (MLNK) 4Q adj EPS $0.01 vs est $0.02 on revs $64Mm vs est $59.9Mm; guides 1Q revs $68.3-69.3Mm vs est $67Mm and FY revs $288-292Mm vs est $287.3Mm

·     Guild Holdings (GHLD) Q4 EPS adj $0.37 vs est. $0.61 on revenue $343.1M vs est. $365.7M

·     BlackRock (BLK) said it has taken about $17B in losses from its Russian securities holdings because of the attack on Ukraine

Healthcare

·     Lifestance Health Group (LFST) Q4 revenue $190.1M vs est. $191.7M; sees a $3M-$7M in Q1 revenue due to Omicron with revenue expected $195M-$200M vs est. $205M, FY22 revenue $865M-$885M vs est. $875.9M

·     Cadre Holdings (CDRE) 4Q EPS $0.13 vs est $0.18 on revs $103.5Mm vs est $104.4Mm; guides FY sales $434-441Mm vs est $439.5Mm

Technology, Media & Telecom

·     LegalZoom (LZ) 4Q EPS ($0.11) vs est ($0.01) on revs $142.1Mm; guides 1Q revs $150-152Mm vs est $160.9Mm and FY revs $650-660Mm vs est $686.6Mm

·     Oracle (ORCL) 4Q adj EPS $1.13 vs est $1.18 on revs $10.5B vs est $10.5B; qtrly cloud svc and license support revs +5%, ttoal cloud revs $2.8B +24%; adj op mgn 46%

·     Docusign (DOCU) 4Q adj EPS $0.48 vs est $0.47 on revs $580.8Mm vs est $562Mm, gr mgn 77%, FCF $70.3Mm; guides 1Q revs $579-583Mm vs est $594.4Mm, adj gr mgn 79-81%, adj op mgn 16-18%; sees FY revs $2.47-2.48B vs est $2.61B, adj gr mgn 79-81%, adj op mgn 16-18%

·     Viant Technology (DSP) 4Q adj EPS $0.17 vs est ($0.01) on revs $82.7Mm vs est $73.2Mm; guides 1Q revs $42-44Mm vs est $55.1Mm and FY revs $260-270Mm vs est $261.2Mm