All posts by Greta Wall
Coffee With Greta: U.S. Downgraded
Register now for today’s free Q&A event on LinkedIn with T3’s Senior Trader Derrick Oldensmith! DJIA Futures: -150 (-0.4%) SPX Futures: -27 (-0.6%) NASDAQ Futures: -127 (-0.8%) Good morning friends! Futures are falling after the U.S. credit rating was downgraded overnight. Let’s get right to it! Fitch Downgrades U.S. Global credit rating agency Fitch Ratings downgraded the United States to AA+ from AAA on Tuesday. Fitch cited “expected fiscal deterioration over the next three years” as the reason for that move after putting the U.S. on negative watch in May amid the debt ceiling fight. The agency said, “The repeated debt-limit political standoffs and last-minute resolutions have eroded confidence in fiscal management.” This is only the second time the U.S. has been downgraded by a credit rating agency. S&P cut the nation’s rating from AAA to AA+ in 2011 amid a similar debt ceiling fight. Private Job Growth Booms The U.S. private sector added far more jobs than expected in July. ADP reported private employers added 324,000 jobs last month vs 175,000 expected. But it was still a slowdown from 455,000 in June. The services sector as a whole added 303,000 jobs, led by leisure and hospitality which gained 201,000. The goods producing sector added just 21,000 as natural resources and mining grew by 48,000 but manufacturing lost 36,000. The Labor Department releases the official July jobs report on Friday which is expected to show the economy added just 200,000 jobs with the unemployment rate unchanged at 3.6%. AMD Earnings Beat Advanced Micro Devices (AMD) shares up 2.5% ahead of the open after beating Q2 expectations on the top and bottom line. Here’s how the chipmaker’s results compared to analysts’ estimates: Adjusted EPS: $0.58 vs $0.57 expected Revenue: $5.36 billion vs $5.31 billion expected Despite the beat, revenue was down 18% year over year. AMD is seeing falling demand in its PC business but says it expects AI to boost its sales in the future. The company is one of few that makes the high-end graphics processing units needed for AI. AMD forecast Q3 revenue of $5.7 billion vs $5.81 billion expected by analysts. Starbucks Sales Disappoint Starbucks (SBUX) shares are falling 0.9% in premarket trade after missing Q2 sales expectations. Here’s how the coffee chain’s results compared to analysts’ estimates: Adjusted EPS: $1 vs $0.95 expected Revenue: $9.17 billion vs $9.29 billion expected Total same-store sales grew 10% year over year vs 11% expected. North American same-store sales also missed estimates, up 7% vs 8.4% expected. Pinterest Expenses Soar Pinterest (PINS) shares are dropping 4% ahead of the open despite beating Q2 expectations as expenses jumped sharply. Here’s how the social media company’s results compared to analysts’ estimates: Adjusted EPS: $0.21 vs $0.12 expected Revenue: $708 million vs $696 million expected Sales were up 6% year over year but total costs and expenses jumped 11%. Global monthly active users rose 8% year over year to 465 million during the quarter. Pinterest said it expects Q3 revenue growth “in the high single digits range year over year”. E.L.F. Surges e.l.f. Beauty (ELF) shares are surging 15.9% in premarket trade after beating fiscal Q1 expectations and hiking its outlook. Here’s how the beauty company’s results compared to analysts’ estimates: Adjusted EPS: $1.10 vs $0.57 expected Revenue: $216.3 million vs $185 million expected For fiscal 2024, Elf now expects between $792 million and $802 million in revenue vs $705 million to $720 million previously. The company forecast full-year adjusted EPS between $2.19 and $2.22 vs $1.73 to $1.76 previously. CVS Slips CVS Health (CVS) shares are down 2.2% ahead of the open despite beating Q2 expectations. Here’s how the pharmacy giant’s results compared to analysts’ estimates: Adjusted EPS: $2.21 vs $2.11 expected Revenue: $88.9 billion vs $86.5 billion expected Net income dropped 37% year over year while revenue rose 10%. CVS maintained its full-year outlook as it continues cost cutting efforts. In Case You Missed It Ford Motor (F) shares rose 1.6% on Tuesday after the automaker reopened its F-150 Lightning factory. The facility had been closed for six weeks for upgrades. Ford also said recent price cuts on the Lightning had significantly increased demand. The EV unit’s chief customer officer said the company has “about 45 days’ worth” of orders for the electric truck. Job openings fell unexpectedly in June. The Labor Department’s Job Openings and Labor Turnover Survey (JOLTS) released on Tuesday showed there were 9.58 million available jobs for the month. That was a decrease from the downwardly revised 9.62 million in May and lower than 9.7 million expected. It was the lowest level of job openings since April 2021. Layoffs also fell to 1.53 million in June from 1.55 million in May.
Continue Reading -->Coffee With Greta: August Kickoff
Register now for tomorrow’s free Q&A on LinkedIn with T3’s Senior Trader Derrick Oldensmith! DJIA Futures: -94 (-0.3%) SPX Futures: -19 (-0.4%) NASDAQ Futures: -86 (-0.5%) Good morning friends! Futures are slipping as a new month of trade begins and a busy earnings week continues. Let’s get right to it! Pfizer Slips On Weak Revenue Pfizer (PFE) shares are down 0.1% ahead of the open after beating Q2 profit expectations but missing on revenue. Here’s how the pharmaceutical giant’s results compared to analysts’ estimates: Adjusted EPS: $0.67 vs $0.57 expected Revenue: $12.73 billion vs $13.27 billion expected Revenue dropped 54% year over year as Covid vaccine sales slowed. The vaccine brought in $1.49 billion in sales during the quarter, down 83% from a year ago. The antiviral pill Paxlovid posted $143 million in sales, down 98% from Q2 2022. Pfizer lowered its full-year sales forecast following the results. The company now expects revenue between $67 billion and $70 billion vs $67 billion to $71 billion previously. Pfizer maintained its full-year adjusted earnings guidance. Uber Jumps On Strong Guidance Uber Technologies (UBER) shares are up 1.1% in premarket trade after reporting mixed Q2 results and issuing strong guidance. Here’s how the ride-hailing giant’s results compared to analysts’ estimates: EPS: $0.18 vs $0.01 loss expected Revenue: $9.23 billion vs $9.33 billion expected Gross bookings jumped 16% year over year to $33.6 billion. The CEO said it was Uber’s first quarter of free cash flow over $1 billion and its first GAAP operating profit. He said the company plans to remain profitable in every quarter moving forward. Uber forecast gross booking between $34 billion and $35 billion in the third quarter with adjusted EBITDA between $975 million and $1.025 billion. Both of those were ahead of analysts’ estimates. JetBlue Drops After Guidance Cut JetBlue Airways (JBLU) shares are down 5.7% ahead of the open after slashing its full-year outlook. Here’s how the airline’s Q2 results compared to analysts’ estimates: Adjusted EPS: $0.45 vs $0.44 expected Revenue: $2.61 billion, as expected But JetBlue now expected full-year adjusted EPS to range between $0.05 and $0.40, down from an earlier estimate of $1. The airline expects an adjusted loss of as much as $0.20 per share in Q3 with revenue down 4% to 8% year over year. That lower outlook is due to passengers’ shifting demand toward international travel as well as the end of JetBlue’s partnership with American Airlines (AAL) in the Northeast. Caterpillar Crushes Q2 Estimates Caterpillar (CAT) shares are up 1.3% in premarket trade after crushing Q2 expectations. Here’s how the company’s results compared to analysts’ estimates: Adjusted EPS: $5.55 vs $4.57 expected Revenue: $17.3 billion vs $16.5 billion expected Caterpillar’s adjusted operating profit margin improved to 21.3% in the quarter, up from 13.8% a year ago. The company said it expects sales and profit margins in Q3 to be higher year over year but down from Q2. In Case You Missed It SoFi Technologies (SOFI) shares surged 19.9% on Monday after beating Q2 expectations on the top and bottom line. The company also hiked its full-year outlook. SOFI closed at a fresh 52-week high. A new Fed survey found lending conditions in the U.S. are tight and likely to get tighter. The Central Bank released its second-quarter Senior Loan Officer Opinion Survey Monday. That report said banks have tightened lending standards for credit cards, consumer loans, and auto loans. Respondents said they plan to further tighten standards in the second half of this year.
Continue Reading -->Coffee With Greta: Another Big Week
Register now for this week’s free Q&A on LinkedIn with ProDesk’s Derrick Oldensmith! DJIA Futures: +67 (+0.2%) SPX Futures: +12 (+0.3%) NASDAQ Futures: +44 (+0.3%) Good morning friends! Futures are higher as traders gear up for another big week of data and earnings. Let’s get right to it! Jobs Week This will be another important week of economic data for traders and the Fed. The Labor Department releases the June job openings and labor turnover survey (JOLTS) on Tuesday. ADP reports private employment numbers for July on Wednesday. And the Labor Department releases the official July jobs report on Friday. The Fed has previously said it is looking for signs of slowing job growth as it works to fight inflation. More Big Earnings It will also be another week of important earnings reports. Here are some of the highlights: Tuesday AM: Pfizer (PFE), Caterpillar (CAT), Uber (UBER) Tuesday PM: AMD (AMD), Starbucks (SBUX), Pinterest (PINS) Wednesday AM: CVS (CVS) Wednesday PM: Qualcomm (QCOM), Shopify (SHOP), PayPal (PYPL), DoorDash (DASH), Unity Software (U) Thursday AM: Moderna (MRNA), Warner Bros Discovery (WBD), Kellogg (K) Thursday PM: Apple (AAPL), Amazon (AMZN), Airbnb (ABNB), Block (SQ), Coinbase (COIN) Yields Flat Treasury yields are up slightly this morning as traders attempt to gauge the Fed’s plans for rates. The 2-year yield is up less than 0.5 points at 4.88% while the 10-year yield is up 1 points at 3.97%. The core PCE price index, which is the Fed’s preferred inflation gauge, cooled more than expected in June. CME Group’s FedWatch tool currently shows 79.5% of traders expecting the Fed to keep rates unchanged at the September meeting. 20.5% are anticipating another 25 bps rate hike. FedWatch shows the majority of traders expecting the Central Bank to keep rates unchanged through the end of the year.
Continue Reading -->Coffee With Greta: Cooling Inflation
Register now for next week’s free Q&A on LinkedIn with ProDesk’s Derrick Oldensmith! DJIA Futures: +148 (+0.4%) SPX Futures: +28 (+0.6%) NASDAQ Futures: +156 (+1.0%) Good morning friends! Futures are rising after the release of cool inflation data. Let’s get right to it! PCE Inflation Drops The Fed’s preferred inflation gauge cooled further in June. The Bureau of Economic Analysis’ personal consumption expenditures (PCE) price index rose 0.2% monthly and 3% annually. That was in line with estimates on a monthly basis and better than 3.1% annually expected. It was the slowest rate of headline inflation since April 2021. But the core PCE price index rose 0.2% monthly and 4.1% year over year. That was better than estimates for a 4.2% annual increase and the lowest level since September 2021. Consumer spending also rose 0.5% last month, up from 0.2% in May. Ford Beats, Hikes Guidance Ford Motor (F) shares are slipping 1.8% ahead of the open despite beating Q2 expectations and hiking its full-year guidance. Here’s how the automaker’s results compared to analysts’ estimates: Adjusted EPS: $0.72 vs $0.55 expected Automotive revenue: $42.43 billion vs $40.38 billion expected Ford said total revenue came in at $45 billion, up 12% year over year. The Model e electric vehicle unit posted a $1.08 billion loss during the quarter. Ford now expects full-year adjusted earnings to range between $11 billion and $12 billion, up from $9 billion to $11 billion previously. The automaker also expected adjusted free cash flow of $6.5 billion to $7 billion vs $6 billion previously. But the company also said it now expects to lose $4.5 billion on the EV business this year, up from $3 billion a year earlier. Intel Returns To Profitability Intel (INTC) shares are up 6.2% in premarket trade after beating Q2 profit expectations. Here’s how the chipmaker’s results compared to analysts’ estimates: Adjusted EPS: $0.13 vs $0.03 loss expected Revenue: $12.9 billion vs $12.13 billion expected The CFO said the stronger than expected performance was partly due to the progress it’s made toward cutting $3 billion in costs this year. That’s part of the company’s previously announced plan to save $10 billion per year by 2025. Intel raised its outlook for the third quarter. The company now expects Q3 adjusted EPS of $0.20 on $13.4 billion in revenue vs analysts’ estimates for $0.16 EPS on $13.23 billion in sales. Roku Rallies Roku (ROKU) shares are rallying 9.1% ahead of the open after reporting a smaller than expected Q2 loss. Here’s how the streaming giant’s results compared to analysts’ estimates: Loss per share: $0.76 vs $1.26 expected Revenue: $847 million vs $775 million expected Roku’s Q3 forecast was also stronger than expected. The company expects $815 million in total revenue with a $50 million adjusted Ebitda loss. That was better than analysts’ estimates for $809 million in revenue and a $57 million loss. Procter & Gamble Pops Procter & Gamble (PG) shares are up 1.6% in premarket trade after beating fiscal Q4 expectations on the top and bottom line. Here’s how the consumer goods giant’s results compared to analysts’ estimates: EPS: $1.37 vs $1.32 expected Revenue: $20.55 billion vs $19.98 billion expected Net sales rose 5% year over year while organic revenue jumped 8%. The better-than-expected performance was driven by price hikes across its products even as sales volume fell 1% from a year ago. But P&G’s outlook came in short. The company expects fiscal 2024 revenue growth of 3% to 4% vs 4.5% expected. P&G also projected EPS growth of 6% to 9%, on the lower end of analysts’ 8.8% projection. In Case You Missed It Anheuser-Busch (BUD) shares fell 0.9% on Thursday after the company announced corporate layoffs. The Bud Light maker plans to layoff about 350 corporate employees in the U.S. The CEO said, “These corporate structure changes will enable our teams to focus on what we do best — brewing great beer for everyone and earning our place in the moments that matter.” The company said the layoffs will not affect brewery and warehouse staff or drivers and field salespeople.
Continue Reading -->Coffee With Greta: Hot Economy
Register now for next week’s free Q&A on LinkedIn with ProDesk’s Derrick Oldensmith! DJIA Futures: +133 (+0.4%) SPX Futures: +37 (+0.8%) NASDAQ Futures: +219 (+1.4%) Good morning friends! Futures are gaining as traders digest hot new economic data and the latest batch of big earnings. Let’s get right to it! Q2 GDP Hotter Than Expected The U.S. economy grew more than expected in the second quarter. The Commerce Department’s first estimate shows GDP increased at a 2.4% annualized rate vs 2% expected. That was up from the 2% growth in Q1. Inflation pressures were also better-than-expected during the quarter. The personal consumption expenditures price index increased 2.6% vs 3.2% expected, down from 4.1% in Q1. Consumer spending rose 1.6% in Q2, accounting for 68% of all economic activity during the quarter. Gross private domestic investment increased 5.7% after dropping 11.9% in the first quarter. Government spending increased 2.6%. Weekly Jobless Claims Fall Weekly jobless claims fell unexpectedly again last week as the labor market maintains strength. The Labor Department reported 221,000 Americans filed initial claims for unemployment benefits. That was down by 7,000 from the previous week and lower than 235,000 expected. Continuing claims also dropped by 59,000 to 1.69 million in the week ending July 15. Meta Rallies Meta Platforms (META) shares are rallying 9.9% ahead of the open after beating Q2 expectations and issuing strong guidance. Here’s how the social media giant’s results compared to analysts’ estimates: EPS: $2.98 vs $2.91 expected Revenue: $32 billion vs $31.12 billion expected Daily Active Users: 2.06 billion vs 2.04 billion expected Monthly Active Users: 3.03 billion vs 3 billion expected Average revenue per user $10.63 vs $10.22 expected Revenue was up 11% year over year, the first quarter of double-digit growth since the end of 2021. Meta forecast Q3 revenue between $32 billion and $34.5 billion vs $31.3 billion expected. That figure suggests 15% growth annually. Chipotle Drops Chipotle Mexican Grill (CMG) shares are falling 7.8% in premarket trade after missing Q2 revenue expectations. Here’s how the restaurant chain’s results compared to analysts’ estimates: Adjusted EPS: $12.65 vs $12.31 expected Revenue: $2.51 billion vs $2.53 billion expected Revenue was up 13.6% year over year while same-store sales grew 7.4% vs 7.5% expected. Chipotle saw lower costs for avocados during the quarter but higher prices for tortillas, beef, and dairy still put pressure on profit. Despite previously saying they were done hiking prices, the CEO seemed more open to another round of prices increases in the future. He said, “As we get closer to that fourth quarter, we’ll make a decision exactly on what we want to do on the pricing front.” Chipotle reiterated its full-year forecast. McDonald’s Beats McDonald’s (MCD) shares are up 1.3% ahead of the open after beating Q2 expectations on the top and bottom line. Here’s how the fast food chain’s results compared to analysts’ estimates: Adjusted EPS: $3.17 vs $2.79 expected Revenue: $6.5 billion vs $6.27 billion expected Global same-store sales jumped 11.7% vs 9.2% expected. Same-store sales in the U.S. rose 10.3%. Southwest Slips Southwest Airlines (LUV) shares are falling 5.5% in premarket trade after missing Q2 profit expectations but beating on revenue. Here’s how the airline’s results compared to analysts’ estimates: Adjusted EPS: $1.09 vs $1.10 expected Revenue: $7.04 billion vs $6.98 billion expected Profit tumbled 10% year over year while total revenue rose 4.6%. But Southwest’s unit revenue dropped 8.3% from a year ago and the company said it expects unit revenue to fall as much as 7% in Q3 despite capacity being 12% higher. Southwest’s operating expenses also jumped more than 12%. Excluding fuel, those expenses were up 7.5%. In Case You Missed It The Federal Reserve raised the federal funds rate on Wednesday by 25 basis points as expected. That puts the benchmark rate in a range of 5.25% to 5.5% – the highest since March 2001. The Fed reiterated it will remain “data dependent” in future meetings and Chairman Jerome Powell said they could either raise rates again or leave them unchanged in September. New home sales dropped unexpectedly in June. The Census Bureau reported new home sales fell 2.5% last month to a seasonally adjusted annual rate of 697,000 units vs 725,000 expected. New home sales in May were also revised lower to 715,000 units from 763,000 previously.
Continue Reading -->Coffee With Greta: Earnings Rush, Fed Day
Register now for next week’s free Q&A on LinkedIn with ProDesk’s Derrick Oldensmith! DJIA Futures: -77 (-0.2%) SPX Futures: -8 (-0.2%) NASDAQ Futures: -41 (-0.3%) Good morning friends! Futures are pulling back as traders digest a rush of earnings reports and gear up for the Fed decision later today. Let’s get right to it! Alphabet Pops Alphabet (GOOGL) shares are up 6.5% ahead of the open after beating Q2 expectations on the top and bottom line. Here’s how the tech giant’s results compared to analysts’ estimates: Adjusted EPS: $1.44 vs $1.34 expected Revenue: $74.6 billion vs $72.82 billion expected YouTube ad revenue: $7.67 billion vs $7.43 billion expected Google Cloud revenue: $8.03 billion vs $7.87 billion expected Revenue was up 7% year over year, the fourth straight quarter of growth in the single digits amid a pullback in digital ad spending. Ad revenue rose just 3.3% from a year ago while Cloud revenue led the gains, up 28% annually. Microsoft Drops Microsoft (MSFT) shares are falling 3.4% in premarket trade after missing fiscal Q4 revenue expectations and issuing weak guidance. Here’s how the tech giant’s results compared to analysts’ estimates: EPS: $2.69 vs $2.55 expected Revenue: $56.19 billion vs $55.47 billion expected Revenue rose 8% year over year, the third straight quarter of single-digit growth for the first time since 2017. Microsoft’s Intelligent Cloud segment brought in $23.99 billion in revenue vs $23.79 billion expected, up 15% annually. Azure revenue jumped 26% year over year vs 25% growth expected. Microsoft’s CFO forecast fiscal Q1 revenue between $53.8 billion and $54.8 billion, implying 8% growth and missing expectations for $54.94 billion. Snap Tumbles Snap (SNAP) are tumbling 17.1% ahead of the open as a weak forecast overshadows better-than-expected Q2 results. Here’s how the social media giant’s results compared to analysts’ estimates: Loss per share: $0.02 vs $0.04 expected Revenue: $1.07 billion vs $1.05 billion expected Global Daily Active Users: 397 million vs 394.9 million expected Average revenue per user: $2.69 vs $2.68 expected Revenue was down 4% year over year, the second consecutive quarter of declining sales. Snap forecast Q3 revenue between $1.07 billion and $1.13 billion, which implies -5% to flat year over year growth. The company expects daily active users to reach between 405 million and 406 million in the current quarter. Analysts were projecting Q3 revenue of $1.13 billion and 406 million daily active users. Coca-Cola Jumps Coca-Cola (KO) shares are up 1.2% in premarket trade after beating Q2 expectations and hiking its full-year outlook. Here’s how the beverage giant’s results compared to analysts’ estimates: Adjusted EPS: $0.78 vs $0.72 expected Revenue: $11.97 billion vs $11.75 billion expected Organic revenue jumped 11% year over year as customers paid higher prices. For the full year, Coke now expects comparable EPS growth of 5% to 6% vs 4% to 5% previously. The company also expects organic revenue growth of 8% to 9% vs 7% to 8% previously. Boeing Beats Boeing (BA) shares are 3.2% higher ahead of the open after beating Q2 expectations on the top and bottom line. Here’s how the planemaker’s results compared to analysts’ estimates: Adjusted loss per share: $0.82 vs $0.88 expected Revenue: $19.75 billion vs $18.45 billion expected Boeing’s revenue was up 18% year over year as the company delivered 136 planes in Q2, up from 121 a year ago. The company also announced it is increasing production of its Max aircraft, to a pace of 38 jets per month from 31 previously. Boeing said it increased output of its 787 Dreamliner to four per month and still plans to increase that to five per month by the end of the year. The CEO said, “With demand strong across our key markets, it is important that we stay focused on execution and on driving stability in our factories and supply chain to ensure we meet our customer commitments.” Boeing reiterated its full-year guidance following the beat. Fed Decision Day The Federal Reserve releases its latest interest rate decision at 2:00 p.m. ET. CME Group’s FedWatch Tool shows 98.9% of traders betting on another 25 basis point rate hike. That would be the 11th increase since March 2022. Focus will be on the Fed Chair’s press conference after the meeting to gauge whether this will be the last rate hike. A 25bps move would put the Federal Funds Rate in a range of 5.25% to 5.5%, the highest level since January 2001. In Case You Missed It Consumer confidence rose to a two-year high this month. The Conference Board’s consumer confidence index rose 6.9 points to 117 vs 112 expected. Confidence about current economic conditions rose 4.7 points to 160, the highest reading since March 2020. The 6-month expectations index jumped 8.3 points to 88.3. The expectations index is now solidly above the 80 threshold that is said to signal a recession ahead.
Continue Reading -->Coffee With Greta: Waiting For MSFT, GOOGL
Register now for today’s free Q&A on LinkedIn with pro trader and podcast host Ben Cahn! DJIA Futures: -11 (-0.03%) SPX Futures: +1 (+0.01%) NASDAQ Futures: +43 (+0.3%) Good morning friends! Futures are mixed as traders await big tech earnings later today and digest the latest results reported this morning. Let’s get right to it! General Motors Hikes Guidance General Motors (GM) shares are flat ahead of the open after beating Q2 estimates and hiking its guidance. Here’s how the automaker’s results compared to analysts’ estimates: Adjusted EPS: $1.91 (not comparable to estimates) Revenue: $44.75 billion vs $42.64 billion expected GM’s net income jumped nearly 52% year over year while revenue rose 25%. The company now expects full-year adjusted earnings between $12 billion and $14 billion vs $11 billion to $13 billion previously. GM also hiked its forecast for adjusted automotive free cash flow to between $7 billion and $9 billion, up from $5.5 billion to $7.5 billion previously. That higher guidance is contingent on GM negotiating new labor agreements with the United Auto Workers and the Canadian Unifor unions without a strike. CEO Mary Barra said, “We have a long history of negotiating fair contracts with both unions that reward our employees and support the long-term success of our business. Our goal this time will be no different. That’s the best possible outcome for all our key stakeholders, including our team, plant communities, dealers, suppliers and investors.” Spotify Drops After Revenue Miss, Weak Guidance Spotify (SPOT) shares are falling 5.6% in premarket trade after missing Q2 revenue expectations and issuing weak guidance. Here’s how the music streaming company’s results compared to analysts’ estimates: Loss per share: 1.55 euros (not comparable) Revenue: 3.18 billion euros vs 3.21 billion euros expected Spotify reported 551 million monthly active users last quarter, up 27% year over year. The company had 220 million paid subscribers during Q2, up 17% from a year ago. Spotify forecast 3.3 billion euros in Q3 revenue vs analysts’ expectations for 3.4 billion euros. The report comes after the company announced price increases for its premium subscription plans on Monday. Premium Individual and Family plans will increase by $1 while Duo plans will go up by $2. Spotify said the market landscape has “continued to evolve” and these changes will help the company “continue to deliver value to fans and artists”. 3M Jumps On Earnings Beat 3M (MMM) shares are up 3.1% ahead of the open after beating Q2 expectations. Here’s how the manufacturing giant’s results compared to analysts’ estimates: Adjusted EPS: $2.17 vs $1.73 expected Revenue: $8 billion vs $7.9 billion expected The company also hiked its full-year outlook, now expected EPS between $8.50 and $9.10 vs $8.50 to $9 previously. That was in line with analysts’ projections for $8.61. General Electric Pops After Earnings Beat, Higher Guidance General Electric (GE) shares are rising 3.8% in premarket trade after crushing Q2 expectations on the top and bottom line. Here’s how the company’s results compared to analysts’ estimates: Adjusted EPS: $0.68 vs $0.46 expected Revenue: $15.9 billion vs $14.8 billion expected Aerospace orders rose 37% year over year, while sales were up 28%. Gas power orders rose 7% annually, sales were flat, and profits jumped 18%. GE’s wind power business reported a record $8.3 billion in new orders, up from $3.1 billion last year. The company now expects full-year EPS between $2.10 and $2.30 vs $1.70 to $2 previously. GE also expects to generate roughly $4.3 billion in free cash flow vs previous guidance for $3.9 billion. In Case You Missed It The U.S. economy grew at the slowest pace in 5 months in July. The S&P Global flash services PMI fell to 52.4 this month vs 54.0 expected. That was the lowest reading since February. The manufacturing PMI rose to 49 vs 46.7 expected, but remains in negative territory.
Continue Reading -->Coffee With Greta: Earnings + Fed In Focus
Register now for tomorrow’s free Q&A on LinkedIn with pro trader and podcast host Ben Cahn! DJIA Futures: +22 (+0.1%) SPX Futures: +6 (+0.1%) NASDAQ Futures: +27 (+0.2%) Good morning friends! Futures are higher as traders gear up for a big earnings week and the upcoming Fed rate decision. Let’s get right to it! AMC Rallies After Big Weekend, Judge’s Ruling AMC Entertainment (AMC) shares are surging 36.1% ahead of the open after a monster opening weekend for Barbie and Oppenheimer. The two movies generated a combined estimate of $235.5 million in ticket sales this weekend. Barbie accounted for $155 million of that total, making it the highest opening of the year. Oppenheimer garnered an estimated $80.5 million during its debut. The success of the Barbie movie is also boosting Mattel (MAT) and Warner Bros (WBD) shares with those stocks up 2.2% and 1.6% respectively ahead of the open. The AMC rally also comes after a judge blocked AMC’s proposed settlement for a stock conversion plan that would allow the company to issue more shares. The judge ruled she cannot approve the settlement “as submitted,” because it would release potential claims by preferred shareholders who were not represented in the lawsuit or settlement. AMC was sued in February for allegedly rigging a shareholder vote that would allow it to convert preferred stock to common stock and issue hundreds of millions of new shares. Domino’s Reports Mixed Q2 Results Domino’s Pizza (DPZ) shares are up 1.7% in premarket trade after reporting mixed Q2 results. Here’s how the pizza chain’s results compared to analysts’ estimates: EPS: $3.08 vs $3.05 expected Revenue: $1.02 billion vs $1.07 billion expected Same-store sales in the U.S. rose just 0.1% year over year while international same-store sales jumped 3.6%. Big Earnings Week Traders are looking ahead to some major earnings later this week with big-tech names on deck. Here’s a look at the highlights: Tuesday AM: General Electric (GE), 3M (MMM), General Motors (GM), Spotify (SPOT) Tuesday PM: Microsoft (MSFT), Alphabet (GOOGL), Snap (SNAP) Wednesday AM: Coca-Cola (KO), Boeing (BA) Wednesday PM: Meta Platforms (META), Thursday AM: Southwest Airlines (LUV) Thursday PM: Intel (INTC), Ford Motor (F), Roku (ROKU) Friday AM: Exxon Mobil (XOM), Chevron (CVX), Procter & Gamble (PG)
Continue Reading -->Coffee With Greta: Mixed Week
Register now for next week’s free Q&A on LinkedIn with pro trader and podcast host Ben Cahn! DJIA Futures: +61 (+0.2%) SPX Futures: +19 (+0.4%) NASDAQ Futures: +101 (+0.7%) Good morning friends! Futures are higher as traders gear up for the final trading day of the week. Let’s get right to it! Dow Extends Win Streak The Dow Jones is on its longest winning streak since 2017. The index closed higher on Thursday for the ninth straight session, at 35,061.21. It’s the longest rally since September 2017 and also the highest closing level since March 2022. The major indices are on track to close out the week mixed. The Dow and S&P 500 are both on track to finish the week higher while the Nasdaq is on track for a weekly decline. Yields Slip Ahead of Fed Next Week Treasury yields are slipping this morning as investors turn their attention to next week’s Fed meeting. Both the 2-year yield and 10-year yield are down 4 basis points. CME Group’s FedWatch Tool shows 99.8% of traders expecting the Fed to hike rates by 25bps next Wednesday. Focus will be on the guidance for future meetings and the Fed Chair’s comments after the meeting. American Express Slides On Revenue Miss American Express (AXP) shares are down 4% ahead of the open after beating Q2 profit expectations but missing on revenue. Here’s how the company’s results compared to analysts’ estimates: EPS: $2.89 vs $2.81 expected Revenue: $15.05 billion vs $15.48 billion expected Revenue was up 12% year over year while network volumes increased 8%. American Express saw an all-time high in spending through its card products during the quarter. The CFO said, “The U.S. consumer just looks really strong” and the company hasn’t seen “any signs of weakness on travel and entertainment habits.” AmEx maintained its full-year outlook. In Case You Missed It Existing home sales dropped to the slowest pace in 14 years in June. The National Association of Realtors reported existing sales fell 3.3% to a seasonally adjusted annual rate of 4.16 million units, in line with expectations. Sales tumbled 18.9% year over year, the slowest sales pace since June 2009 as low supply squeezes buyers. There were 1.08 million homes for sale at the end of June, down 13.6% from a year ago and representing a 3.1-month supply. The median price of a home sold in June was $410,200, the second-highest on record.
Continue Reading -->Coffee With Greta: TSLA, NFLX Drag
Register now for next week’s free Q&A on LinkedIn with pro trader and podcast host Ben Cahn! DJIA Futures: +3 (+0.01%) SPX Futures: -13 (-0.3%) NASDAQ Futures: -130 (-0.8%) Good morning friends! Futures are mostly lower as tech stocks slide following earnings from giants like Tesla and Netflix. Let’s get right to it! Tesla Reports Record Revenue Tesla (TSLA) shares are falling 4.1% ahead of the open despite beating Q2 expectations on the top and bottom line. Here’s how the electric automaker’s results compared to analysts’ estimates: Adjusted EPS: $0.91 vs $0.82 expected Revenue: $24.93 billion vs $24.47 billion expected Tesla’s automotive revenue jumped 46% year over year to $21.27 billion. The company’s operating margin dropped to 9.6%, driven by increased incentives and price cuts on its vehicles. CEO Elon Musk said on the earnings call, “We continue to target 1.8 million vehicle deliveries this year, but expect Q3 production will be a little bit down because we’ve got summer shutdowns for a lot of factory upgrades.” Tesla reported Q2 deliveries earlier this month which topped expectations. Netflix Slides On Weak Outlook Netflix (NFLX) shares are down 6.1% in premarket trade after reporting mixed Q2 results. Here’s how the streaming giant’s results compared to analysts’ estimates: EPS: $3.29 vs $2.86 expected Revenue: $8.19 billion vs $8.3 billion expected Netflix added 5.9 million new subscribers during the quarter as it cracked down on password sharing in the U.S. That sharply beat expectations for 3 million net new subscribers. The company said it will now roll out that new policy to the rest of its customers. Netflix forecast Q3 revenue of $8.52 billion vs $8.67 billion expected, Q3 EPS of $3.52 vs $3.23 expected, and an addition of 4 million new subscribers. The company reiterated its full-year operating margin outlook. IBM Misses Q2 Revenue Estimates International Business Machines (IBM) shares are down 1% ahead of the open after beating Q2 profit expectations but missing on revenue. Here’s how the company’s results compared to analysts’ estimates: Adjusted EPS: $2.18 vs $2.01 expected Revenue: $15.48 billion vs $15.58 billion expected IBM reported an adjusted gross margin of 55.9% vs 54.7% expected. The CFO attributed those higher margins to a more profitable mix of products and “productivity initiatives” like job cuts. He said, “The productivity benefits free up spend for reinvestment and contribute to margin expansion.” IBM reiterated its outlook for between 3% and 5% revenue growth this year and $10.5 billion in free cash flow. United Airlines Rallies On Record Earnings United Airlines (UAL) shares are up 2.6% in premarket trade after reporting record Q2 results. Here’s how the airline’s results compared to analysts’ estimates: Adjusted EPS: $5.03 vs $4.03 expected Revenue: $14.18 billion vs $13.91 billion expected United’s fuel bill tumbled 26% year over year which helped boost the bottom line. Capacity rose 17.5% from a year ago while revenue per available seat mile slipped 0.4%. For the third quarter, the airline expects capacity to expand 16% from last year with revenue growth of 13%. United forecast adjusted Q3 EPS between $3.85 and $4.35 vs $3.70 expected. American Airlines Slips Despite Earnings Beat, Higher Outlook American Airlines (AAL) shares are falling 1.5% ahead of the open despite beating Q2 expectations on the top and bottom line. Here’s how the airline’s results compared to analysts’ estimates: Adjusted EPS: $1.92 vs $1.59 expected Revenue: $14.06 billion vs $13.74 billion expected Revenue was up 4.7% year over year while flying capacity rose 5.3%. American hiked its full-year outlook following the beat. The airline now expects adjusted EPS between $3 and $3.75 this year vs $2.50 to $3.50 previously. That forecast was in line with analysts’ estimates of $3.10 per share. Weekly Jobless Claims Tumble To Nine-Week Low Weekly jobless claims fell unexpectedly last week in the latest sign of strength for the labor market. The Labor Department reported 228,000 Americans filed initial unemployment claims. That was down by 9,000 from the week before and lower than expectations for claims to rise to 240,000. Continuing claims rose by 33,000 to 1.75 million in the week ending July 8. In Case You Missed It Apple (AAPL) shares rose on Wednesday following a Bloomberg report that the company is developing its own equivalent of ChatGPT. That report claims Apple has built a chatbot that some call “Apple GPT”. Some Apple staffers reportedly believe the company is aiming for a significant AI announcement next year.
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