All posts by Greta Wall
Coffee With Greta: SPX Tops 5,000
DJIA Futures: +73 (+0.2%) SPX Futures: +14 (+0.3%) NASDAQ Futures: +66 (+0.4%) Good morning friends! Futures are rising after an encouraging revision to December’s inflation data. Let’s get right to it! December CPI Revised Lower The S&P 500 is poised to open above 5,000 this morning after briefly topping the historic milestone for the first time ever on Thursday. Futures are up across all the major indexes with all three on track for their fifth consecutive winning week. The government revised December’s CPI print lower this morning to a 0.2% monthly gain vs 0.3% previously. The core CPI remained at a 0.3% monthly gain. The revisions are part of seasonal adjustments made by the Bureau of Labor Statistics but confirm inflation was cooler faster than previously thought at the end of 2023. That is good news for traders hoping for a Fed rate cut sooner rather than later. CME Group’s FedWatch Tool still shows over 82% betting on no change at the March 20 Fed meeting with nearly 54% expecting the first rate cut at the May 1 meeting. Pinterest Revenue, Outlook Disappoint Pinterest (PINS) shares are dropping 9.3% ahead of the open after reporting mixed Q4 results and issuing weak guidance. Here’s how the company’s results compared to analysts’ estimates: Adjusted EPS: $0.53 vs $0.52 expected Revenue: $981.3 million vs $991 million expected Revenue rose 12% year over year while global monthly active users rose 11% to an all-time high of 498 million. Pinterest forecast Q1 revenue between $690 million and $705 million vs $702 million expected. Affirm Drops After Earnings Affirm Holdings (AFRM) shares are down 6.8% in premarket trade despite beating fiscal Q2 expectations. Here’s how the buy-now pay-later company’s results compared to analysts’ estimates: Loss per share: $0.54 vs $0.72 expected Revenue: $591.1 million vs $520.9 million expected Revenue jumped 48% year over year. Gross merchandise volume increased for the third straight quarter, up 32% from a year ago to $7.5 billion. Active consumers rose 13% to 17.6 million. Affirm forecast fiscal Q3 revenue between $530 million and $550 million vs $487.7 million expected. Pepsico Reports Mixed Results Pepsico (PEP) shares are up 0.1% ahead of the open after reporting mixed Q4 results. Here’s how the beverage giant’s results compared to analysts’ estimates: Adjusted EPS: $1.78 vs $1.72 expected Revenue: $27.85 billion vs $28.4 billion expected Revenue was down less than 1% year over year, the first quarter since 2020 the company has seen an annual decline. Organic revenue rose 4.5%, boosted by higher prices. But those higher prices hit demand as sales volumes declined. Volume at Pepsi’s North American Quaker Foods division dropped 8%, Frito-Lay North America posted a 2% volume decline, and the North American beverage unit saw sales volumes down 6%. Pepsi forecast 2024 organic revenue growth of at least 4% vs its previous outlook on the high end of 4% to 6%.
Continue Reading -->Coffee With Greta: Flirting With 5,000
DJIA Futures: +19 (+0.1%) SPX Futures: -5 (-0.1%) NASDAQ Futures: -18 (-0.1%) Good morning friends! Futures are mostly lower with the S&P 500 on the brink of crossing 5,000 points for the first time ever. Let’s get right to it! Disney Pops After Earnings Beat, Higher Guidance Walt Disney (DIS) shares are up 8.2% ahead of the open after beating fiscal Q1 expectations and hiking its guidance. Here’s how the company’s results compared to analysts’ estimates: Adjusted EPS: $1.22 vs $0.99 expected Revenue: $23.55 billion vs $23.64 billion expected The company announced a $0.45 dividend payable in July, up 50% from the January payout. Entertainment revenue fell 7% year over year to $9.98 billion, ESPN revenue rose 4%, and experiences revenue jumped 7%. Disney+ subscribers decreased by 1.3 million from the previous quarter due to price increases but average revenue per user rose. Disney said it is on track to meet or exceed its goal of cutting costs by at least $7.5 billion this fiscal year. The company forecast fiscal 2024 EPS of $4.60, which would be at least 20% higher than 2023. CEO Bob Iger also announced Disney will take a $1.5 billion stake in Epic Games to create new games using its intellectual property, including Disney, Pixar, Marvel, Star Wars and Avatar. PayPal Plunges On Disappointing Guidance PayPal (PYPL) shares are tumbling 8.4% in premarket trade after beating Q4 expectations but issuing soft guidance. Here’s how the digital payments giant’s results compared to analysts’ estimates: Adjusted EPS: $1.48 vs $1.36 expected Revenue: $8.03 billion vs $7.87 billion expected Revenue increased 9% year over year while net income jumped 52%. The number of active PayPal accounts fell 2% from a year ago to 426 million vs 427.17 million expected. For the first quarter, PayPal forecast annual EPS growth in the mid-single digits vs 8.7% expected. The company expects full-year earnings of $5.10 per share vs $5.48 expected. Arm Spikes On Strong Forecast Arm Holdings (ARM) shares are surging 27.9% ahead of the open after beating fiscal Q3 expectations and issuing strong guidance. Here’s how the chipmaker’s results compared to analysts’ estimates: Adjusted EPS: $0.29 vs $0.25 expected Revenue: $824 million vs $761 million expected Total revenue jumped 14% from the same quarter a year ago. Royalty revenue rose 11% year over year to $470 million which Arm attributed to a recovery in the smartphone market. The company forecast fiscal Q4 earnings between $0.28 and $0.32 per share on $850 million to $900 million in revenue. Analysts expect EPS of $0.21 on $780 million in sales. Spirit Airlines Rises As Losses Narrow Spirit Airlines (SAVE) shares are up 3.0% in premarket trade after reporting a narrower loss than expected in the fourth quarter. Here’s how the airline’s results compared to analysts’ estimates: Adjusted loss per share: $1.36 vs $1.46 expected Revenue: $1.32 billion, in line with expectations Revenue was down 5% year over year. Spirit said fare revenue per passenger tumbled 25% to $48.24, while nonticket revenue per passenger dropped 6.6% to $66.60. The company said it expects to post another profit loss in Q1 but forecast revenue between $1.25 billion and $1.28 billion which beat analysts’ expectations. Spirit is planning for 2024 capacity to be flat to up mid single digits and 1.5% higher in Q1. Weekly Jobless Claims Fall Weekly jobless claims fell more than expected as the labor market remains tight. The Labor Department reported 218,000 Americans filed initial claims for unemployment benefits last week. That was down by 9,000 from the previous week and lower than 220,000 expected. Continuing claims fell by 23,000 to 1.87 million in the week ending January 27.
Continue Reading -->Coffee With Greta: Earnings Continue
DJIA Futures: +55 (+0.1%) SPX Futures: +15 (+0.3%) NASDAQ Futures: +78 (+0.4%) Good morning friends! Futures are higher as Q4 earnings continue to roll-in. Let’s get right to it! Snap Plunges On Disappointing Earnings Snap (SNAP) shares are plummeting 30.5% ahead of the open after missing Q4 revenue expectations and issuing soft guidance. Here’s how the social media company’s results compared to analysts’ estimates: Adjusted EPS: $0.08 vs $0.06 expected Revenue: $1.36 billion vs $1.38 billion expected Global daily active users: 414 million vs 412 million expected Average revenue per user: $3.29 vs $3.33 expected Revenue rose 5% year over year, marking the sixth straight quarter of single-digit growth. Snap forecast Q1 revenue between $1.095 billion and $1.135 billion putting the midpoint at $1.115 billion vs $1.117 billion expected. Ford Jumps On Strong Earnings, Outlook Ford Motor (F) shares are rising 5.6% in premarket trade after beating Q4 expectations and issuing strong guidance. Here’s how the automaker’s results compared to analysts’ estimates: Adjusted EPS: $0.29 vs $0.14 expected Automotive revenue: $43.2 billion vs $40.12 billion expected Total revenue rose 4% year over year to $46 billion. The automaker announced a special $0.18 dividend per share for the first quarter in addition to the regular dividend of $0.15 per share. The dividends are payable on March 1 to shareholders of record at the market close on February 16. Ford forecast adjusted earnings before interest and taxes of between $10 billion and $12 billion in 2024 vs $9 billion to $11 billion expected. The company also expects full-year adjusted free-cash flow of $6 billion to $7 billion and capital spending of $8 billion to $9.5 billion. Chipotle Crushes Earnings Expectations Chipotle Mexican Grill (CMG) shares are up 2.8% ahead of the open after beating Q4 expectations on the top and bottom line. Here’s how the burrito chain’s results compared to analysts’ estimates: Adjusted EPS: $10.36 vs $9.75 expected Revenue: $2.52 billion vs $2.49 billion expected Revenue rose 15.4% year over year while same-store sales jumped 8.4% vs 7.1% expected. Chipotle said foot traffic in its stores rose 7.4% during the quarter, bucking the trend of lower foot traffic at similar businesses. Sales were also boosted by a 3% menu price increase that was implemented in October. Chipotle forecast 2024 full-year same-store sales growth in the mid-single-digit range. Uber Slips Despite Earnings Beat Uber (UBER) shares are down 1.8% in premarket trade despite beating Q4 expectations on the top and bottom line. Here’s how the ride-hailing service’s results compared to analysts’ estimates: EPS: $0.66 vs $0.17 expected Revenue: $9.94 billion vs $9.76 billion expected Revenue jumped 15% year over year. Uber’s gross booking totaled $27.6 billion in the quarter, up 22% from a year ago. Mobility gross bookings rose 29% to $19.3 billion while delivery gross bookings jumped 19% to $17 billion. Uber forecast gross bookings in the first quarter between $37 billion and $38.5 billion vs $37.43 billion expected. The company expects adjusted EBITDA of $1.26 billion to $1.34 billion vs $1.26 billion expected. CVS Beats Expectations, Cuts Outlook CVS (CVS) shares are up 1.1% ahead of the open after beating Q4 expectations on the top and bottom line. Here’s how the drugstore chain’s results compared to analysts’ estimates: Adjusted EPS: $2.12 vs $1.99 expected Revenue: $93.81 billion vs $90.41 billion expected Revenue rose nearly 12% year over year but profits did shrink compared to a year ago. The company’s health services segment contributed the most to that revenue growth, generating $49.15 billion in revenue vs $46.35 billion expected. Same-store sales grew 11.3% year over year, up 15.5% in the pharmacy division, but down by 3.1% in the front of the store. CVS lowered its full-year adjusted EPS forecast to at least $8.30 vs $8.50 previously and $8.49 expected.
Continue Reading -->Coffee With Greta: Bouncing Back
DJIA Futures: +14 (+0.04%) SPX Futures: +7 (+0.2%) NASDAQ Futures: +40 (+0.2%) Good morning friends! Futures are higher as traders digest the latest batch of earnings. Let’s get right to it! Eli Lilly Rallies On Earnings Beat Eli Lilly (LLY) shares are up 5.2% ahead of the open after beating Q4 expectations on the top and bottom line. Here’s how the pharmaceutical company’s results compared to analysts’ estimates: Adjusted EPS: $2.49 vs $2.22 expected Revenue: $9.35 billion vs $8.93 billion expected Revenue jumped 28% year over year as the company saw strong demand for its weight loss products. $175.8 million in revenue was from Zepbound, Eli Lilly’s newly-approved weight loss drug. Its diabetes drug, Mounjaro, brought in $2.21 billion in sales vs $1.73 billion expected. Eli Lilly forecast full-year adjusted EPS of $12.20 to $12.70 on $40.4 billion to $41.6 billion in revenue. That was slightly better than expectations for adjusted EPS of $12.43 on $39.38 billion in revenue. Palantir Surges After Revenue Beat Palantir Technologies (PLTR) shares are surging 20.1% in premarket trade after beating Q4 revenue expectations. Here’s how the software company’s results compared to analysts’ estimates: Adjusted EPS: $0.08, as expected Revenue: $608.4 million vs $602.4 million expected Revenue jumped 20% year over year. In a letter to shareholders, the CEO said Palantir’s expansion and growth “have never been greater.” He wrote, “Our results reflect both the strength of our software and the surging demand that we are seeing across industries and sectors for artificial intelligence platforms.” Palantir forecast Q1 revenue between $612 million and $616 million and full-year revenue between $2.65 billion and $2.67 billion. That was roughly in line with analysts’ forecasts for Q1 revenue of $617 million and $2.66 billion in full-year sales. Spotify Rallies On Strong User Growth Spotify (SPOT) shares are up 8.4% ahead of the open after reporting stronger-than-expected user growth in the fourth quarter. Here’s how the streaming company’s results compared to analysts’ estimates: Per share loss: $0.36 vs $0.40 expected Revenue: $3.94 billion vs $3.99 billion expected Monthly active users: 602 million vs 601 million expected Premium subscribers: 236 million vs 235 million expected The company’s gross margin rose to 36.7% in the quarter, up 1.4% year over year thanks to cost-cutting efforts and higher prices. Spotify said it expects monthly active users to climb to 618 million and premium subscribers to hit 239 million in Q1. The company said, “With revenue and profitability trends both inflecting favorably heading into 2024, we view the business as well positioned to deliver improving growth and profitability.”
Continue Reading -->Coffee With Greta: Taking A Breath
DJIA Futures: -102 (-0.3%) SPX Futures: -14 (-0.3%) NASDAQ Futures: -27 (-0.2%) Good morning friends! Futures are lower as the Fed continues to strike down hopes of a rate cut soon. Let’s get right to it! Powell Doubles Down Fed Chair Jerome Powell doubled down on the bank’s plans for patience when it comes to rate cuts during an appearance on 60 Minutes Sunday night. The Chairman said, “With the economy strong like that, we feel like we can approach the question of when to begin to reduce interest rates carefully… “We want to see more evidence that inflation is moving sustainably down to 2%. Our confidence is rising. We just want some more confidence before we take that very important step of beginning to cut interest rates.” The comments largely echoed those made during his press conference last Wednesday after the FOMC voted to keep interest rates unchanged. CME Group’s FedWatch Tool shows over 82% of traders expecting no rate hike or cut at the March 20 meeting. Currently, over 56% are betting on the first cut to happen in May. Quieter Week This will be a calmer week for traders after last week’s busy schedule. Several Fed speakers are scheduled throughout the week, which will give more insight on the bank’s future plans for interest rate policy. There is no major economic data set to be released besides the weekly jobless claims report on Thursday morning. The earnings calendar is also lighter after last week’s mega cap tech reports. Here are the highlights: Tuesday AM: Eli Lilly (LLY), Spotify (SPOT) Tuesday PM: Chipotle (CMG), Ford Motor (F), Snap (SNAP) Wednesday AM: Uber (UBER), CVS (CVS), Roblox (RBLX) Wednesday PM: Walt Disney (DIS), Arm Holdings (ARM), PayPal (PYPL) Thursday PM: Pinterest (PINS), Affirm (AFRM) Friday AM: Pepsico (PEP) McDonald’s Drops On Revenue Miss McDonald’s (MCD) shares are down 2.0% ahead of the open after missing Q4 revenue expectations. Here’s how the fast food giant’s results compared to analysts’ estimates: Adjusted EPS: $2.95 vs $2.82 expected Revenue: $6.41 billion vs $6.45 billion expected Revenue rose 8% year over year. McDonald’s reported global same-store sales growth of 3.4% vs 4.7% expected, weighed down by struggling sales in the Middle East. Domestic same-store sales rose 4.3%, in line with expectations and boosted by higher menu prices. McDonald’s reiterated its 2024 forecast for systemwide sales growth of nearly 2%.
Continue Reading -->Coffee With Greta: Strong Jobs Report Crushes Rate Cut Hopes
DJIA Futures: -138 (-0.4%) SPX Futures: +1 (+0.02%) NASDAQ Futures: +50 (+0.3%) Good morning friends! Futures are mixed as traders digest the strong jobs report and big tech earnings. Let’s get right to it! Jobs Report Crushes Expectations The U.S. economy added far more jobs than expected in January. The Labor Department reported employers added 353,000 jobs last month vs 185,000 expected. The unemployment rate was unchanged at 3.7% vs expectations for an increase to 3.8%. Average hourly earnings increased 0.6% monthly and 4.5% year over year. That was far better than economists’ expectations for 0.3% monthly and 4.1% annually. Professional and business services led the job gains adding 74,000 workers. Health care added 70,000, retail trade added 45,000, government added 36,000, social assistance added 30,000, and manufacturing added 23,000. December’s job gains were also revised higher to 333,000 from the 216,000 initial estimate. November was revised up to 182,000 from 173,000. The strong labor market data sent Treasury yields shooting higher this morning. The 10-year yield is up 13 basis points at 4% while the 2-year yield is up 19 basis points at 4.40%. CME Group’s FedWatch Tool now shows over 80% of traders betting the Fed will keep rates unchanged at the March 20 meeting. Amazon Rallies On Strong Earnings Amazon (AMZN) shares are rallying 6.4% ahead of the open after crushing Q4 expectations and issuing strong guidance. Here’s how the tech giant’s results compared to analysts’ estimates: EPS: $1.00 vs $0.80 expected Revenue: $170 billion vs $166.2 billion expected Amazon Web Services Revenue: $24.2 billion as expected Ad Revenue: $14.7 billion vs $14.2 billion expected Revenue surged 14% year over year thanks to a strong holiday shopping season and Amazon’s October Prime Day event. CEO Andy Jassy said, “This Q4 was a record-breaking Holiday shopping season and closed out a robust 2023 for Amazon. As we enter 2024, our teams are delivering at a rapid clip, and we have a lot in front of us to be excited about.” Amazon forecast Q1 sales between $138 billion and $143.5 billion vs $142.1 billion expected. That would represent growth of 8% to 13%. Apple Falls On Weak iPhone Outlook Apple (AAPL) shares are down 3.7% in premarket trade after beating fiscal Q1 estimates but forecasting weaker iPhone sales. Here’s how the iPhone maker’s results compared to analysts’ estimates: EPS: $2.18 vs $2.10 expected Revenue: $119.58 billion vs $117.91 billion expected iPhone revenue: $69.70 billion vs $67.82 billion expected Mac revenue: $7.78 billion vs $7.73 billion expected iPad revenue: $7.02 billion vs $7.33 billion expected Other Products revenue: $11.95 billion vs $11.56 billion expected Services revenue: $23.12 billion vs $23.35 billion expected The company did not provide official guidance for the current quarter but the CFO said both total company revenue and iPhone sales would be similar to the same quarter last year. Meta Surges On Earnings Beat, Dividend Announcement Meta Platforms (META) shares are surging 16.5% ahead of the open after crushing Q4 expectations and announcing the company’s first-ever dividend. Here’s how the Facebook parent company’s results compared to analysts’ estimates: EPS: $5.33 vs $4.96 expected Revenue: $40.11 billion vs $39.18 billion expected Revenue jumped 25% year over year, the fastest rate of growth since mid-2021. Net income more than tripled from a year ago. Meta’s “year of efficiency” appears to have paid off in 2023 as the company doubled its operating margin to 41% while expenses decreased 8% year over year. The company announced it will pay investors a $0.50 per share dividend on March 26. Meta also announced a $50 billion share buyback.
Continue Reading -->Coffee With Greta: March Cut Hopes Dashed
DJIA Futures: +17 (+0.04%) SPX Futures: +20 (+0.4%) NASDAQ Futures: +100 (+0.6%) Good morning friends! Futures are higher as traders digest the first Fed decision of the year and await big tech earnings after the close. Let’s get right to it! Yields Fall After Fed Decision Treasury yields are falling this morning as the market digests the first Fed decision of 2024. The 10-year yield is down two basis points at 3.90% while the 2-year yield is down one basis point at 4.20%. The Federal Reserve threw cold water on traders’ hopes for a March rate cut on Wednesday. The Federal Open Market Committee kept the federal funds rate in a range of 5.25% to 5.5% as expected. In its statement, the FOMC said, “The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent.” The statement did remove language about “any additional policy firming that may be appropriate”, which was a key change for shifting policy ahead. But Chairman Jerome Powell said in his press conference, “Based on the meeting today, I would tell you that I don’t think it’s likely that the committee will reach a level of confidence by the time of the March meeting to identify March as the time to do that. But that’s to be seen.” CME Group’s FedWatch Tool now shows nearly 61% of traders expecting the first 25bps rate cut at the May 1 meeting. Qualcomm Slips On Weak Guidance Qualcomm (QCOM) shares are down 2.1% ahead of the open after beating fiscal Q1 expectations but issuing soft guidance. Here’s how the chipmaker’s results compared to analysts’ estimates: Adjusted EPS: $2.75 vs $2.37 expected Revenue: $9.92 billion vs $9.51 billion expected Net income jumped 24% year over year. The company said it shipped $6.69 billion in smartphone chips during the quarter, up 16% from a year ago. Qualcomm forecast fiscal Q2 adjusted EPS between $1.73 and $1.93 on revenue of $8.9 billion to $9.7 billion. Analysts’ were forecasting EPS of $2.25 on $9.3 billion in revenue. Peloton Tumbles On Mixed Results, Bad Outlook Peloton (PTON) shares are plunging 10.1% in premarket trade after reporting mixed fiscal Q2 results and issuing weak guidance. Here’s how the fitness equipment maker’s results compared to analysts’ estimates: Loss per share: $0.54 vs $0.53 expected Revenue: $743.6 billion vs $733.5 million For fiscal Q3, Peloton forecast sales between $700 million and $725 million vs $754 million expected. The company expects an adjusted EBITDA loss of $20 million to $30 million vs expectations for a $2 million loss. The CFO said, “Our outlook is tempered by uncertainty surrounding our ability to efficiently grow Paid App subscribers and the performance of other new initiatives, as well as an uncertain macroeconomic outlook.” More MAG7 Earnings Ahead Today will be a big day of earnings for traders after the market closes. The rest of the Magnificent 7 stocks are scheduled to report after-hours with Apple (AAPL), Meta Platforms (META), and Amazon (AMZN). Focus is on these results after Microsoft (MSFT) and Alphabet (GOOGL) reported earlier this week. Apple’s results will be released at 4:30 p.m. ET with the conference call at 5:00, the stock’s implied move is 5%. Meta’s report will be out at 4:15 p.m. ET with the earnings call at 5:00, the stock’s implied move is 11.8%. Amazon’s report will be released right as the market closes at 4:00 p.m. ET with the conference call at 5:30, the stock’s implied move is 7.2%. Weekly Jobless Claims Climb To 3-Month High Weekly jobless claims rose more than expected last week in a possible sign of a softening labor market. The Labor Department reported 224,000 Americans filed initial claims for unemployment benefits last week. That was up by 9,000 from the previous week and higher than 214,000 expected. It was also the highest total in nearly three months. Continuing claims rose by 70,000 to 1.9 million in the week ending January 20.
Continue Reading -->Coffee With Greta: Big Tech Earnings + The Fed
DJIA Futures: +48 (+0.1%) SPX Futures: -24 (-0.5%) NASDAQ Futures: -171 (-1.0%) Good morning friends! Futures are mixed as traders digest big tech earnings, new jobs data, and look ahead to the Fed decision. Let’s get right to it! Private Job Growth Slows Job growth in the U.S. private sector slowed more than expected in January. Payroll firm ADP reported private employers added 107,000 jobs in the first month of the year vs 150,000 expected. That was a decline from the downwardly revised 158,000 in December. The information services sector was the only to report a drop, losing 9,000 workers. Leisure and hospitality added 28,000 workers, trade, transportation and utilities added 23,000, and construction rose by 22,000. ADP’s report showed a 5.2% annual increase in wages in January. This data comes ahead of the official jobs report from the Labor Department on Friday which is expected to show the U.S. economy added 185,000 and the unemployment rate rising to 3.8%. Microsoft Slips After Earnings Microsoft (MSFT) shares are down 0.5% ahead of the open after beating fiscal Q2 expectations on the top and bottom line but issuing soft guidance. Here’s how the tech giant’s results compared to analysts’ estimates: EPS: $2.93 vs $2.78 expected Revenue: $62.02 billion vs $61.12 billion expected Total revenue rose 17.6% year over year. Microsoft’s Intelligent Cloud segment reported $25.88 billion in revenue, up 20% from a year ago and higher than $25.29 billion expected. Revenue from Azure and other cloud services jumped 30% year over year vs 27.5% growth expected. Microsoft forecast fiscal Q3 revenue between $60 billion and $61 billion, putting the middle of the range at $60.5 billion vs $60.93 billion expected. Alphabet Slides On Disappointing Ad Revenue Alphabet (GOOGL) shares are falling 5.7% in premarket trade after reporting lower than expected Q4 ad revenue. Here’s how the tech giant’s results compared to analysts’ estimates: Adjusted EPS: $1.64 vs $1.59 expected Revenue: $86.31 billion vs $85.33 billion expected Google Cloud Revenue: $9.19 billion vs $8.94 billion expected Overall Ad Revenue: $65.52 billion vs $65.94 billion expected YouTube Ad Revenue: $9.2 billion vs $9.21 billion expected Alphabet’s total revenue jumped 13% year over year, the fastest quarter of growth since early 2022. Google Cloud saw growth of 26% during the quarter. AMD Drops On Weak Forecast Advanced Micro Devices (AMD) shares are down 4.6% ahead of the open after reporting Q4 earnings that were in line with expectations and issuing soft guidance. Here’s how the chipmaker’s results compared to analysts’ estimates: Adjusted EPS: $0.77, in line with estimates Revenue: $6.17 billion vs $6.12 billion expected AMD forecast Q1 sales of $5.4 billion, plus or minus $300 million. That was short of analysts’ expectations for $5.73 billion. AMD’s CEO said, “For 2024, we expect the demand environment to remain mixed.” Starbucks Misses Expectations Starbucks (SBUX) shares are up 5% in premarket trade despite reporting weaker than expected fiscal Q1 earnings and revenue. Here’s how the coffee giant’s results compared to analysts’ estimates: Adjusted EPS: $0.90 vs $0.93 expected Revenue: $9.4 billion vs $9.59 billion expected Revenue rose 8% year over year. Global same-store sales rose 5% from a year ago, missing expectations for 7.2% growth. North American same-store sales also rose 5%. International same-store sales growth of 7% fell short of expectations for 13.2% growth. Boeing Beats Q4 Estimates Boeing (BA) shares are up 1.8% ahead of the open after beating Q4 expectations. Here’s how the planemaker’s results compared to analysts’ estimates: Adjusted loss per share: $0.47 vs $0.78 expected Revenue: $22.02 billion vs $21.11 billion expected Revenue rose 10% year over year and Boeing had $2.95 billion in free cash flow during the quarter. The company declined to provide 2024 guidance amid the latest controversy with its Max 9 planes. The CEO said, “While we often use this time of year to share or update our financial and operational objectives, now is not the time for that. We will simply focus on every next airplane while doing everything possible to support our customers, follow the lead of our regulator and ensure the highest standard of safety and quality in all that we do. Ultimately – that is what will drive our performance.” In Case You Missed It The number of job openings in the U.S. rose unexpectedly in December. The Labor Department’s job openings and labor turnover survey (JOLTS) shows there were 9.026 million available jobs in the final month of 2023. That was higher than 8.714 million expected and the first month above 9 million since September. The data shows the U.S. labor market continuing to maintain strength amid the Fed’s tightening efforts. Consumer confidence jumped to a two-year high this month. The Conference Board’s consumer confidence index rose to 114.8 in January from 108 in December. That slightly missed economists’ expectations for a reading of 115. It is the highest level of consumer confidence since December 2021. Confidence in current economic conditions rose to 161.3 from 147.2. The six-month expectations index rose to 83.8 from 81.9. U.S. home prices cooled in November. The S&P Case-Shiller national home price index fell 0.2% monthly from October. It was the first monthly drop since January 2023. National prices were still 5.1% higher compared to November 2022. The 10-city index rose 6.2% year over year while the 20-city index rose 5.4% annually.
Continue Reading -->Coffee With Greta: Gearing Up For Big Tech
DJIA Futures: -89 (-0.2%) SPX Futures: -11 (-0.2%) NASDAQ Futures: -46 (-0.3%) Good morning friends! Futures are slipping as traders gear up for the start of big tech earnings this afternoon. Let’s get right to it! SMCI Surges After Earnings Super Micro Computer (SMCI) shares are rallying 11.5% ahead of the open after crushing fiscal Q2 results and hiking its full-year outlook. Here’s how the server and computer products maker’s results compared to analysts’ estimates: Adjusted EPS: $5.59 vs $5.05 expected Revenue: $3.66 billion vs $2.8 billion expected Those results were even better than what the company pre-announced last week. For the fiscal third quarter, SMCI expects adjusted EPS of $5.20 to $6.01 on revenue of $3.7 billion to $4.1 billion. That sharply beat analysts’ estimates of $4.61 in adjusted EPS on $2.9 billion in revenue. The company also raised its full-year forecast to between $14.3 billion and $14.7 billion vs its previous outlook for $10 billion to $11 billion. General Motors Jumps On Earnings Beat, Strong Outlook General Motors (GM) shares are up 7.4% in premarket trade after beating Q4 expectations on the top and bottom line. Here’s how the automaker’s results compared to analysts’ estimates: Adjusted EPS: $1.24 vs $1.16 expected Revenue: $42.98 billion vs $38.67 billion expected GM’s full-year 2023 revenue rose 10% from 2022 and the company forecast another strong year in 2024. The CFO said, “As we begin 2024, I believe GM is well positioned for another year of strong financial performance.” GM expects full-year 2024 adjusted EPS of $8.50 to $9.50 and adjusted automotive free cash flow of $8 billion to $10 billion. Pfizer Tops Earnings Estimates Pfizer (PFE) shares are up 0.6% ahead of the open after reporting a surprise profit in the fourth quarter. Here’s how the pharmaceutical giant’s results compared to analysts’ estimates: Adjusted EPS: $0.10 vs $0.22 loss per share expected Revenue: $14.25 billion vs $14.42 billion expected Revenue dropped 10% year over year as Covid product sales plunged. Pfizer’s Covid vaccine and Paxlovid treatment brought in $12.5 billion in total revenue in 2023, down 78% from 2022. Excluding Covid products, Pfizer’s Q4 revenue grew 8%. The company reiterated its 2024 forecast for adjusted EPS of $2.05 to $2.25 on $58.5 billion to $61.5 billion in revenue. UPS Sinks After Revenue Miss, Weak Outlook United Parcel Service (UPS) shares are falling 5.6% in premarket trade after missing Q4 revenue expectations and issuing weak guidance. Here’s how the shipping giant’s results compared to analysts’ estimates: Adjusted EPS: $2.47 vs $2.46 expected Revenue: $24.92 billion vs $25.40 billion expected Revenue was down 7.8% year over year and missed forecasts for the sixth straight quarter. Domestic package revenue dropped 7.3% to $16.92 billion vs $17.39 billion expected. International package revenue declined 6.9% to $4.61 billion vs $4.64 billion expected. UPS did raise its quarterly dividend to $1.63 per share, implying a 4.13% yield based on Monday’s closing price. The company forecast 2024 revenue of $92 billion to $94.5 billion vs $95.51 billion expected. UPS also announced it will layoff 12,000 employees as part of cost-cutting efforts this year. The CEO said those cuts will save the company about $1 billion in costs.
Continue Reading -->Coffee With Greta: Huge Week Kicks Off
DJIA Futures: -18 (-0.1%) SPX Futures: -0.25 (-0.01%) NASDAQ Futures: +18 (+0.1%) Good morning friends! Futures are flat as traders begin a huge week. Let’s get right to it! Key Week This will be a major week for traders between the first Fed meeting of 2024, big tech earnings, and the January jobs report. Things kickoff with the December Job Openings and Labor Turnover Survey (JOLTS) plus January consumer confidence on Tuesday. Mega-cap tech companies also begin reporting earnings on Tuesday with Microsoft (MSFT), Alphabet (GOOGL), and Advanced Micro Devices (AMD) scheduled to report after the close. On Wednesday, traders will get ADP’s private employment report ahead of the open with the Fed rate decision and press conference at 2:00 p.m. ET. Thursday is another big earnings day with Apple (AAPL), Amazon (AMZN), and Meta Platforms (META) after-hours. Friday morning, the Labor Department releases the official January jobs report. Yields Fall Treasury yields are lower this morning ahead of this week’s Fed meeting. The 10-year yield is down four basis points at 4.10%. The central bank is expected to leave interest rates unchanged on Wednesday. But focus will be on the statement’s language about future rate cuts and on what Fed Chair Jerome Powell says about cuts in his press conference. CME Group’s FedWatch Tool shows just under 49% of traders anticipating the first cut at the March 20 meeting. Over 50% are betting on a cut at the May 1 meeting. iRobot Tumbles After Amazon Dumps Deal iRobot (IRBT) shares are plunging 18.7% ahead of the open after Amazon (AMZN) terminated its planned acquisition of the vacuum-maker. The two companies said there was “no path to regulatory approval for the deal.” iRobot also announced it will lay off 31% of its employees, impacting around 350 people. Its CEO and board chair also stepped down effective immediately. Amazon will pay iRobot a $94 million breakup fee.
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