Coffee With Greta: Fed Hangover Weighs on Stocks
DJIA Futures: -238 (-0.7%) SPX Futures: -38 (-1%) NASDAQ Futures: -141 (-1.3%) Good morning friends! Futures are falling after the Fed seemed to strike down market expectations for a pivot in the near future. Let’s get right to it! Fed Dashes Hopes for a Pivot The Federal Open Market Committee approved its fourth consecutive 75bps rate hike on Wednesday. That puts the Federal Funds Rate in a range of 3.75% to 4%, the highest level since January 2008. The FOMC statement also seemed to hint at the bank slowing the pace of its tightening. The Fed said it “will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments” when determining future rate hikes. But Chairman Jerome Powell maintained his hawkish tone in the post-meeting press conference, saying inflation is still well above target and the bank will “stay the course until the job is done”. Powell told reporters he doesn’t think they have overtightened and it is “very premature to think about pausing rate hikes”. CME Group’s FedWatch Tool shows 52% of traders expecting a 50bps rate hike at the December meeting with 48% anticipating another 75bps move. Bank of England Approves Large Rate Hike The Bank of England followed the Fed’s lead overnight, hiking its benchmark interest rate by 75 basis points. That’s the largest hike in 33 years and the eighth in a row. U.K. inflation spiked to 10.1% in September and is expected to rise to 11% in Q4. But the economy is also slowing. U.K. GDP is projected to decline 0.75% in the second half of 2022 and continue falling throughout 2023 and early 2024. Weekly Jobless Claims Dip Weekly jobless claims dipped in late October as the labor market maintains strength in the face of the Fed’s inflation fight. The Labor Department reported 217,000 Americans filed initial unemployment claims last week. That was down 1,000 from the week before and better than expectations for an increase to 220,000. Continuing claims rose by 50,000 to 1.49 million in the week ending October 22. Roku Plummets on Outlook Roku (ROKU) shares are plunging 21% ahead of the open despite beating Q3 expectations. Here’s how the streaming platform’s results compared to analysts’ expectations: Loss per share: $0.88 vs $1.29 expected Revenue: $761.4 million vs $696.1 million expected But Roku’s Q4 forecast came in weak, dragging the stock down. The company expects revenue of $800 million this quarter and an adjusted EBIDTA loss of $135 million. That would mark a decline of 8% year over year and missed analysts’ estimates of $899 million in revenue and an adjusted EBITDA loss of $48 million. The stock is on track to open at a new 52-week low. Qualcomm Issues Weak Guidance, Announces Hiring Freeze Qualcomm (QCOM) shares are falling 8.1% in premarket trade after reporting fiscal Q4 results that were in line with expectations and weak Q1 guidance. Here’s how the chipmaker’s results compared to analysts’ estimates: Adjusted EPS: $3.13, as expected Revenue: $11.39 billion vs $11.37 billion expected Revenue was up 22% year over year. Qualcomm forecast fiscal Q1 adjusted EPS of $2.25 to $2.45 on $9.2 billion to $10 billion in revenue. That was weaker than analysts’ estimates for adjusted EPS of $3.42 on $12.02 billion in revenue. The company also announced it implemented a hiring freeze at the start of the current quarter due to macroeconomic headwinds. Peloton Collapses on Weak Outlook Peloton (PTON) shares are plunging 15.4% ahead of the open after missing Q3 estimates and issuing weak guidance. Here’s how the exercise device maker’s results compared to analysts’ estimates: Loss per share: $1.20 vs $0.64 expected Revenue: $616.5 million vs $650.1 million expected Revenue fell 23% compared to a year ago. The company lost members during the quarter, reporting 6.7 million total members vs 6.9 million in Q2. But its free cash flow continued to improve to negative $246.3 million vs negative $411.9 million in Q2. Peloton forecast Q4 revenue between $700 million and $725 million. That would mark an increase from Q3 but was sharply lower than analysts’ estimates of $874 million. The company said, “Given macro economic uncertainties we believe near-term demand for Connected Fitness hardware is likely to remain challenged.” Moderna Tumbles After Q3 Miss Moderna (MRNA) shares are tumbling 8.3% in premarket trade after missing Q3 expectations and lowering its full-year guidance for Covid vaccine sales. Here’s how the pharmaceutical giant’s results compared to analysts’ expectations: Adjusted EPS: $2.53 vs $3.29 expected Revenue: $3.36 billion vs $3.53 billion expected Revenue was down 32% year over year while profits plunged 68%, due to lower Covid vaccine sales. Moderna now expects $18 billion to $19 billion in revenue from the vaccine this year, down from previous guidance for $21 billion. Key Earnings After the Close Here are the key companies scheduled to report Q3 results after the close today: Starbucks (SBUX) PayPal (PYPL) Block (SQ) DoorDash (DASH) Coinbase (COIN)
Continue Reading -->Coffee With Greta: Too Many Jobs for the Fed
DJIA Futures: -97 (-0.3%) SPX Futures: -8 (-0.2%) NASDAQ Futures: -11 (-0.1%) Good morning friends! Futures are slipping as traders digest new labor market data and look ahead to today’s Fed decision. Let’s get right to it! Private Job Growth Comes in Hot Private employers in the U.S. added more jobs than expected in October. Payroll firm ADP reported today the U.S. private sector added 239,000 jobs last month vs expectations for just 195,000. That was up from the downwardly revised 192,000 in September. The leisure and hospitality sector saw the strongest growth, adding 210,000 jobs. The report showed wages jumped 7.7% year over year in October This data comes a day after the Labor Department’s Job Openings and Labor Turnover Survey (JOLTS) came in hot. That survey showed the number of job openings jumped to 10.7 million in September from a revised 10.3 million in August. That was higher than economists’ expectations for a decline to 9.85 million and is bad news for the Fed as it works to cool the hot labor market. The official October jobs report on Friday is expected to show the U.S. economy added 205,000 jobs with the unemployment rate unchanged at 3.5%. Fed Decision Day Stocks are slipping ahead of the Fed’s latest interest rate hike. The Central Bank releases that decision at 2:00 p.m. ET. CME Group’s FedWatch Tool shows 92.2% of traders expecting another 75 basis point hike, which is in line with the Fed’s dot plot. But the market is more focused on what the bank says about the future. FedWatch shows 47.7% of traders expecting the Fed to pivot to a 50bps hike in December, with 48.7% anticipating another 75bps move. AMD Rallies Despite Q3 Miss Advanced Micro Devices (AMD) shares are up 5.4% ahead of the open despite missing Q3 expectations. Here’s how the chipmaker’s results compared to analysts’ estimates: Adjusted EPS: $0.67 vs $0.68 expected Revenue: $5.57 billion vs $5.62 billion expected Revenue was up 29% year over year but even weaker than AMD’s preliminary results from early October. The chipmaker forecast $23.5 billion in full-year revenue, down from $26.3 billion previously and lower than analysts’ expectations for $23.88 billion. Airbnb Slides On Guidance Airbnb (ABNB) shares are down 4.9% in premarket trade despite beating Q3 expectations on the top and bottom line. Here’s how the company’s results compared to analysts’ expectations: EPS: $1.79 vs $1.47 expected Revenue: $2.88 billion vs $2.85 billion expected Gross bookings: $15.6 billion vs $15.37 billion expected Airbnb’s adjusted EBITDA hit a record high $1.5 billion in the quarter. But the company forecast lower revenue in Q4, “consistent with historical seasonality”. Airbnb expects revenue between $1.8 billion and $1.88 billion next quarter, in line with estimates of $1.87 billion. CVS Hikes Outlook CVS (CVS) shares are up 1.4% ahead of the open after beating Q3 estimates and hiking its outlook. Here’s how the pharmacy giant’s results compared to analysts’ estimates: EPS: $2.09 vs $1.99 expected Revenue: $81.16 billion vs $76.75 billion expected Revenue was up 10% year over year and that marked the 3rd straight quarter CVS has beat profit expectations. The company raised its full-year outlook following the beat. CVS now expects adjusted EPS between $8.55 and $8.65, up from $8.40 to $8.60 previously. Mortgage Demand Slides Further U.S. mortgage demand fell last week despite rates dropping for the first time in 2 months. The Mortgage Bankers Association reported overall application volume slipped 0.5%. Purchase applications fell 1% weekly and were down 41% year over year. Refinance applications rose 0.2% weekly but were down 85% compared to a year ago. The average 30-year contract rate decreased to 7.06% from 7.16% the previous week. That’s the first decline in 2 months but still hovering near a 22-year high.
Continue Reading -->Coffee With Greta: New Month, Same Rally?
DJIA Futures: +225 (+0.7%) SPX Futures: +42 (+1.1%) NASDAQ Futures: +158 (+1.4%) Good morning friends! Futures are rising as a new month of trade kicks off on Wall Street and this week’s Fed meeting is set to begin. Let’s get right to it! Can The October Rally Extend? October was the best month for the Dow Jones since January 1976. The blue chip index rallied 14% last month, the S&P 500 jumped 8%, and the Nasdaq rose 3.9%. The new month begins with all eyes on the Fed as the Central Bank kicks off its two-day policy meeting today. CME Group’s FedWatch tool shows 89.8% of traders expecting another 75 basis point hike on Wednesday. Pfizer Tops Q3 Expectations, Hikes Guidance Pfizer (PFE) shares are up 3.9% in premarket trade after beating Q3 expectations and hiking its guidance. Here’s how the pharmaceutical giant’s results compared to analysts’ expectations: Adjusted EPS: $1.78 vs $1.39 expected Revenue: $22.6 billion vs $21 billion expected Covid vaccine sales fell sharply in the quarter to $4.4 billion globally, down 66% from Q3 2021. But the weaker global demand was offset by strong demand in the U.S. where sales jumped 83% year over year due to the rollout of new omicron specific boosters. Pfizer’s antiviral pill Paxlovid also generated $7.5 billion in global sales last quarter. The company now expects EPS of $6.40 to $6.50 in 2022, up from the previous forecast of $6.30 to $6.45. Pfizer raised its full-year guidance for Covid vaccine sales to $34 billion, up $2 billion from the previous forecast. It maintained revenue expectations of $22 billion for Paxlovid. Uber Rallies On Revenue Beat Uber (UBER) shares are rallying 11.7% ahead of the open after beating Q3 revenue expectations. Here’s a look at the ride share giant’s results: Loss per share: $0.61 Revenue $8.34 billion vs $8.12 billion expected Revenue jumped 72% year over year. Uber’s adjusted EBITDA came in at a record $516 million, beating prior guidance for $440 million to $470 million and topping analysts’ estimates for $457.7 million. Gross bookings jumped to $29.1 billion, up 26% compared to a year ago. Uber expects gross bookings to grow between 23% and 27% year over year in Q4 with adjusted EBITDA of $600 million to $630 million. Oil Prices Rise Oil prices are higher today as a weakening dollar offsets demand concerns in China. West Texas Intermediate crude futures are up 2.3% to $88.50 bbl while Brent crude futures are up 2.1% to $94.75 bbl. Both contracts posted their first monthly gains since May in October. September JOLTS On Deck The first piece of this week’s labor market data will be out today. The Labor Department releases its September Job Openings and Labor Turnover Survey (JOLTS) at 10:00 a.m. ET. That survey is expected to show the number of job openings fell to 9.8 million from 10.1 million. Key Earnings After the Close This is the busiest week of Q3 earnings season so far. Here are the companies scheduled to report after the close today: Advanced Micro Devices (AMD) Airbnb (ABNB)
Continue Reading -->4 Stocks I’m Eyeing This Week
We have mostly red arrows around the world after a big four-week rally. Asia still doesn’t act well after China’s NBS PMI’s fell short. Hong Kong’s Q3 GDP report was soft. Developments in Russia/Ukraine are also weighing as Moscow withdrew from the grain agreement. SPX futures are -24. We hit 3905 Friday. I’d think a bit of digestion ahead of the Fed Wednesday makes sense. Holding 3862ish would be very constructive. 3803-3806 is the line in the sand for the active bulls and this active sequence. Now let’s go through 4 names I’m watching: AAPL responded very well to earnings. It gave us a way to be long as it cleared $149 to see $157.50. There is news that Foxconn will shut for Covid, but that shouldn’t change much. A little digestion above $152.50 should be constructive. Holding $154ish would even be better. AMD reports after the close tomorrow. It’s been pressured all year. We uncovered the H&S pattern helping us stay out of the way. I’m long a little into today. We’ll see if it goes green with pivot resistance at $62.72. If not, I’ll be out. COIN is after the close Thursday, We had a decent trade last week. I bought some back on Friday. We’ll see if it gets any more play prior. It needs to hold $5=69 and perhaps we can add over $73.72. TSLA gave us a very tradable move last week with a Red Dog Reversal at $202 and then another entry when it cleared $213.50. It hit the $233 area. For this week, we’ll see if it can hold Friday’s low of $216 or higher for an additional move towards $250. But we’ll take it somewhat slow. I’ll be active here if I get the signals. Positions Disclosure: *As of 8:20am ET October 31, 2022
Continue Reading -->Coffee With Greta: Yields Spike, Stocks Fall As Fed Week Begins
DJIA Futures: -177 (-0.5%) SPX Futures: -23 (-0.6%) NASDAQ Futures: -81 (-0.7%) Good morning friends! Futures are falling as Treasury yields spike at the start of Fed week. Let’s get right to it! Treasury Yields Climb Ahead of the Fed Treasury yields are rallying with stocks falling ahead of this week’s Fed meeting. The 2-year yield is up 15 basis points at 4.49% while the 10-year yield is up 10 basis points at 4.05%. Traders widely expect the Fed to hike rates by another 75 basis points on Wednesday. But the market is also looking for some clarity on the bank’s future plans. Dow on Track for Best Month Since 1976 The Dow Jones is on track for its best month since 1976, up 14.4% so far in October. The S&P 500 and the Nasdaq are also up for the month. That puts Wall Street on track to snap its two-month losing streak. Today is the final day of October before key economic data comes out later this week. Jobs data begins on Tuesday with the release of the Labor Department’s Job Openings and Labor Turnover Survey. ADP reports private payroll numbers for October on Wednesday. The Fed decision is also on Wednesday. And then the official October jobs report on Friday. The central bank is looking for signs of slowing strength in the labor market amid its fight against inflation. Oil Prices Drop Oil prices are falling today after weaker-than-expected factory data in China and demand concerns due to the country’s COVID restrictions. West Texas Intermediate crude futures are down 1.9% to just over $86 bbl while Brent crude futures are down 1.3% to $94.50 bbl. But both contracts are still on track for their first monthly gains since May. A new survey shows factory activity in China fell unexpectedly in October. Earnings Heat Up We’ve gotten a mix of earnings so far this season but this will be the busiest week so far. Here are some highlights: Tuesday AM: Pfizer (PFE), Uber (UBER) Tuesday PM: Advanced Micro Devices (AMD), Airbnb (ABNB) Wednesday AM: CVS (CVS) Thursday AM: Regeneron (REGN), Moderna (MRNA), Marriott (MAR) Thursday PM: Starbucks (SBUX), PayPal (PYPL), Block (SQ), Coinbase (COIN)
Continue Reading -->Coffee With Greta: Inflation Is Still Hot
DJIA Futures: +69 (+0.2%) SPX Futures: -11 (-0.3%) NASDAQ Futures: -90 (-0.8%) Good morning friends! Futures are mixed as traders digest new inflation data and Amazon’s (AMZN) big Q3 miss puts more pressure on tech stocks. Let’s get right to it! PCE Inflation Is Still Hot U.S. inflation pressures were still running hot in September as the Fed’s rate hikes show no signs of slowing price gains. The Bureau of Economic Analysis’ personal consumption expenditures (PCE) price index rose 0.3% monthly and 5.1% year over year. But it’s not just high gas prices fueling those gains anymore. The core PCE price index – which excludes food and energy prices – rose 0.5% monthly and 5.1% annually. That was up from the 4.9% annual gain in August and that index is the Fed’s preferred measure of inflation. Musk Cleans House at Twitter Twitter (TWTR) shares are up 0.3% in premarket trade after Tesla (TSLA) CEO Elon Musk closed his purchase of the company. Musk reportedly took over at the social media giant Thursday night and quickly fired top executives. CEO Parag Agrawal, CFO Ned Segal, and head of legal policy Vijaya Gadde were all reportedly fired upon the deal closing. Musk named himself CEO after making those moves. He sent out a tweet after the deal closed, saying “the bird is freed”. Amazon Craters on Revenue Miss, Disappointing Guidance Amazon (AMZN) shares are plunging 13.8% ahead of the open after missing Q3 revenue expectations and issuing disappointing Q4 guidance. Here’s how the tech giant’s results compared to analysts’ expectations: EPS: $0.28 Revenue: $127.10 billion vs $127.46 billion expected Amazon Web Services Revenue: $20.5 billion vs $21.1 billion expected Ad Revenue: $9.55 billion vs $9.48 billion expected Amazon expects Q4 revenue between $140 billion and $148 billion vs $155.15 expected. That’s a disappointing outlook for the company’s key holiday shopping quarter. Apple Tops Fiscal Q4 Expectations, iPhone Sales Fall Short Apple (AAPL) shares are up 0.3% in premarket trade after narrowly beating fiscal Q4 expectations. Here’s how the iPhone maker’s results compared to analysts’ expectations: EPS: $1.29 vs. $1.27 expected Revenue: $90.15 billion vs. $88.90 billion expected iPhone revenue: $42.63 billion vs. $43.21 billion expected Mac revenue: $11.51 billion vs. $9.36 billion expected iPad revenue: $7.17 billion vs. $7.94 billion expected Other Products revenue: $9.65 billion vs. $9.17 billion expected Services revenue: $19.19 billion vs. $20.10 billion expected Gross margin: 42.3% vs. 42.1% expected Apple did not provide official guidance for fiscal Q1, which is the company’s biggest sales season of the year. But the CFO said the company expects slower annual revenue growth with Mac sales expected to decline year over year. Intel Beats Q3 Expectations Intel (INTC) shares are rallying 6.7% ahead of the open after beating Q3 expectations on the top and bottom line. Here’s how the chipmaker’s results compared to analysts’ estimates: Adjusted EPS: $0.59 vs $0.32 expected Revenue: $15.34 billion vs $15.25 billion expected Revenue declined 15% year over year, improving from the 22% decline in Q2. Intel trimmed its full-year forecast, now expecting adjusted EPS of $1.95 and $63 billion to $64 billion in revenue. That’s down from the prior forecast for $2.30 in adjusted EPS and $65 billion to $68 billion in revenue. Analysts were expecting guidance for $2.15 in adjusted EPS and $65.26 billion in sales. Intel’s CEO said, “We are planning for the economic uncertainty to persist into 2023.” Amid that uncertainty, the company said it’s aiming to reduce its cost of sales and operating expenses by $3 billion in 2023. Those annual savings are expected to reach $8 billion to $10 billion by the end of 2025. Pinterest Soars On Earnings Beat Pinterest (PINS) shares are jumping 9.1% in premarket trade after beating Q3 estimates. Here’s how the social media company’s results compared to analysts’ expectations: Adjusted EPS: $0.11 vs $0.06 expected Revenue: $684.6 million vs $666.7 million expected Revenue was up 8% year over year while monthly average users remained flat. Pinterest expects Q4 revenue growth in the mid-single digits as it continues to face foreign exchange headwinds. Exxon Mobil Reports Record Profits Exxon Mobil (XOM) shares are up 2.1% ahead of the open after reporting record profits in Q3. Here’s how the oil giant’s results compared to analysts’ expectations: EPS: $4.45 vs $3.86 expected Revenue: $112 billion vs $105 billion expected Exxon’s $18.7 billion profit was a new company record. It’s the second quarter in a row of record earnings which has caused criticism from Democrats as Americans pay high gas prices at the pump. Chevron Reports Near Record Profits Chevron (CVX) shares are up 2.1% in premarket trade after reporting its second-highest quarterly profit ever in Q3. Here’s how the oil company’s results compared to analysts’ estimates: Adjusted EPS: $5.56 vs $4.89 expected Revenue: $66.6 billion vs $57.4 billion expected Profits were up 90% year over year to $10.8 billion, down slightly from $11.4 billion in Q2. Chevron said higher oil and natural gas prices contributed to that surge.
Continue Reading -->Coffee With Greta: META’s Mega Miss
DJIA Futures: +274 (+0.9%) SPX Futures: +6 (+0.2%) NASDAQ Futures: -36 (-0.3%) Good morning friends! Futures are mixed as disappointing tech earnings weigh on the Nasdaq and a higher-than-expected GDP reading boosts the DJIA. Let’s get right to it! Meta Plummets After Earnings Miss Meta (META) shares are plummeting 22.9% ahead of the open after missing Q3 profit expectations and issuing weak guidance. Here’s how the social media giant’s results compared to analysts’ expectations: EPS: $1.64 vs $1.89 expected Revenue: $27.71 billion vs $27.38 billion expected Daily Active Users: 1.98 billion, in line with expectations Monthly Active Users: 2.96 billion vs 2.94 billion expected Average Revenue per User: $9.41 vs $9.83 expected Revenue dropped 4%, the second straight quarter of revenue declines as Meta struggles with a broad slowdown in online ad spending. Costs and expenses jumped 19% compared to a year ago. The company forecast Q4 revenue will be between $30 billion and $32.5 billion vs analysts’ expectations for $32.2 billion. Revenue in Meta’s virtual reality division, Reality Labs, fell to $285 million with its loss widening to $3.67 billion from $2.63 billion a year earlier. Ford Weighed Down by Supply Chain Issues Ford (F) shares are down 2% in premarket trade despite narrowly beating Q3 expectations. Here’s how the automaker’s results compared to analysts’ estimates: Adjusted EPS: $0.30 vs $0.27 expected Revenue: $37.2 billion vs $36.25 billion expected Ford recorded a net loss of $827 million due to continued supply chain issues and costs related to disbanding its autonomous vehicle unit. Adjusted profits were down 40% year over year. Ford updated its full-year guidance, expecting adjusted earnings before interest and taxes of about $11.5 billion vs $11.5 billion to $12.5 billion previously. The company raised its full-year adjusted cash flow forecast to between $9.5 billion and $10 billion vs $5.5 billion to $6.5 billion previously. Higher Prices Boost McDonald’s Profits McDonald’s (MCD) shares are up 2.1% ahead of the open after beating Q3 expectations. Here’s how the fast food giant’s results compared to analysts’ expectations: EPS: $2.68 vs $2.58 expected Revenue: $5.87 billion vs $5.69 billion expected McDonald’s did not see a slowdown in traffic even as it raised its menu prices to mitigate higher costs. Global same-store sales jumped 9.5%, crushing estimates of 5.8% growth. Same-store sales in the U.S. rose 6.1%. U.S. Economy Expands More than Expected The U.S. economy expanded more than expected in Q3 as the shrinking trade deficit boosted GDP. The Bureau of Economic Analysis’ first estimate of Q3 GDP shows 2.6% annualized growth vs 2.3% expected. That’s the first positive reading of this year after the economy contracted in Q1 and Q2. Weekly Jobless Claims Tick Higher Weekly jobless claims rose less than expected last week. The Labor Department reported 217,000 Americans filed initial claims for unemployment benefits. That was up by 3,000 from the previous week but lower than expectations for 220,000. Continuing claims rose by 55,000 to 1.44 million in the week ending October 15. ECB Hikes Rates The European Central Bank announced its another 75-basis point rate hike today. That’s the second 0.75% rate hike in a row and puts the main benchmark rate in at 1.5%, the highest level seen since 2009. The ECB confirmed more rate hikes are ahead. In its statement, the bank said, “The Governing Council… expects to raise interest rates further, to ensure the timely return of inflation to its 2% medium-term inflation target.” The Eurozone is experiencing record-high inflation and a slowing economy. Several economists have projected a 50-basis point hike in December but the ECB did not indicate the level of future hikes. Key Earnings After the Close Here are the key companies set to report earnings after the close today: Apple (AAPL) Amazon (AMZN) Intel (INTC)
Continue Reading -->Coffee With Greta: Big Tech Stumbles
DJIA Futures: -102 (-0.3%) SPX Futures: -36 (-0.9%) NASDAQ Futures: -223 (-1.9%) Good morning friends! Futures are falling as traders digest disappointing earnings from big tech companies. Let’s get right to it! Alphabet Disappoints Alphabet (GOOGL) shares are dropping 6.7% after missing Q3 expectations on the top and bottom line. Here’s how the Google parent company’s results compared to analysts’ expectations: EPS: $1.06 vs $1.25 expected Revenue: $69.09 billion vs $70.58 billion expected YouTube ad revenue: $7.07 billion vs $7.42 billion expected Google Cloud revenue: $6.9 billion vs $6.69 billion expected Revenue growth slowed to just 6% in the quarter vs 41% in the same quarter a year ago. That’s the weakest quarter of growth since 2013 excluding early in the pandemic. The CFO said hiring in Q4 will slow to less than half of the additions in Q3. Microsoft Tops Fiscal Q1 Expectations, Guidance Falls Short Microsoft (MSFT) shares are falling 6.8% in premarket trade despite beating fiscal Q1 expectations after guidance came in weak. Here’s how the tech giant’s results compared to analysts’ expectations: EPS: $2.35 vs $2.30 expected Revenue: $50.12 billion vs $49.61 billion expected Revenue was up 11% year over year. But revenue in the Intelligent Cloud business segment missed expectations at $20.33 billion vs $20.36 billion estimated. Azure revenue grew just 35% in fiscal Q1, down from 40% in the previous quarter and lower than analysts’ expectations for growth over 36%. Microsoft forecast fiscal Q2 revenue between $52.35 billion and $53.35 billion vs analysts’ estimates of $56.05 billion. The company expects Azure revenue growth of 37% next quarter vs the 39.4% estimate from analysts. Price Hikes Boost Chipotle Earnings Chipotle Mexican Grill (CMG) shares are slipping 0.6% ahead of the open after reporting mixed Q3 results. Here’s how the restaurant chains results compared to analysts’ expectations: Adjusted EPS: $9.51 vs $9.21 expected Revenue: $2.22 billion vs $2.23 billion expected Same-store sales rose 7.6% year over year vs 7.3% expected. Total transactions declined 1% but the CEO said Chipotle saw “minimal resistance” to higher menu prices. Chipotle forecast Q4 same-store sales growth in the mid-to-high single digits and expects to open between 235 and 250 new restaurants by year-end. Boeing Reports Surprise Loss Boeing (BA) shares are down 0.7% in premarket trade after reporting an unexpected Q3 loss. Here’s how the plane maker’s results compared to analysts’ expectations: Loss per share: $6.18 vs $0.07 in earnings expected Revenue: $15.96 billion vs $17.76 billion expected Boeing reported a $2.8 billion loss in its defense unit due to the KC-46 tanker and Air Force One. Commercial revenue rose 40% from a year ago as Boeing delivered 112 planes during the quarter vs 85 in Q3 2021. The company generated nearly $3 billion in free cash flow, up from $507 million a year earlier. Boeing reiterated its forecast to achieve positive free cash flow for the year. Bed Bath & Beyond Appoints Interim CEO to Position Permanently Bed Bath & Beyond (BBBY) shares are tumbling 7.4% ahead of the open after naming its interim CEO, Sue Gove, to the position permanently. Gove was appointed to the position over the summer after the company’s board pushed out the former CEO. Bed Bath is still searching for a new CFO. The prior chief accounting officer is serving in that role on an interim basis. Mortgage Demand Falls Further Mortgage demand continued to drop last week as rates surged. The Mortgage Bankers Association reported purchase application fell 2% weekly and were down 42% year over year. Refinance applications slipped just 0.1% weekly and were down 86% annually. Demand is at the lowest level since 1997. The average 30-year contract rate rose to 7.16% from 6.94%, a 21-year high. New Home Sales Expected to Fall The Commerce Department reports new home sales for September at 10:00 a.m. ET. That report is expected to show the pace of sales fell last month to a seasonally adjusted annual rate of 593,000 units vs 685,000 in August. Key Earnings After the Close Here are the key companies set to report earnings after the close today: Meta (META) Ford (F)
Continue Reading -->New eBook: The Ultimate Trading Journal
In this business, success and failure are 100% on an individual’s shoulders. You make all your own choices and decisions, which directly impact whether you win or lose. To become a successful trader, you need to develop expertise through practice and constantly improve yourself. Journaling can help you accelerate your learning curve and become successful faster in this business. That’s why I hope you’ll download “The Ultimate Trading Journal” today. When journaling, you review your trades, reflect on your actions, summarize what you have learned, and then lay out things you need to improve upon. That will give you the roadmap you need to build your confidence and get you on the road to sustainable success. Check it out here.
Continue Reading -->Coffee With Greta: Traders Await Big Tech Earnings
DJIA Futures: -161 (-0.5%) SPX Futures: -14 (-0.4%) NASDAQ Futures: -15 (-0.1%) Good morning friends! Futures are falling as traders digest a barrage of Q3 earnings and await big tech earnings later today. Let’s get right to it! Coca-Cola Beats Q3 Expectations, Hikes Outlook Coca-Cola (KO) shares are up 2.4% ahead of the open after beating Q3 expectations and hiking its full-year outlook. Here’s how the beverage giant’s results compared to analysts’ expectations: Adjusted EPS: $0.69 vs $0.64 expected Revenue: $11.05 billion vs $10.52 billion expected Sales rose 10% while organic revenue jumped 16%, field by higher prices for the company’s products. Coke now expects comparable earnings growth of 6% to 7% this year vs 5% to 6% previously. UPS Reports Mixed Q3 Results UPS (UPS) shares are up 2.6% in premarket trade after reporting mixed Q3 results. Here’s how the shipping giant’s results compared to analysts’ expectations: EPS: $2.99 vs $2.84 expected Revenue: $24.16 billion vs $24.30 billion expected UPS reaffirmed its full-year outlook for revenue of $102 billion. The company’s shipping volumes decline in the quarter but that drop was partially offset by higher rates. General Motors Crushes Q3 Profit Expectations General Motors (GM) shares are up 3% ahead of the open after sharply beating Q3 earnings expectations. Here’s how the automaker’s results compared to analysts’ estimates: Adjusted EPS: $2.25 vs $1.88 expected Revenue: $41.89 billion vs $42.22 billion expected GM maintained its full-year guidance with the CFO saying the company expects to hit the “mid-point” of that outlook. In a letter to investors, CEO Mary Barra said “demand continues to be strong for GM products and we are actively managing the headwinds we face.” JetBlue Misses Q3 Profit Estimates JetBlue (JBLU) shares are slipping 3.6% in premarket trade after missing Q3 profit expectations. Here’s how the airline’s results compared to analysts’ estimates: Adjusted EPS: $0.21 vs $0.23 expected Revenue: $2.56 billion, in line with estimates Revenue rose 30% year over year as travelers paid higher fares. But JetBlue’s operating margin narrowed to 5.4% vs 9.4% a year ago as expenses surged 36%. In a note to employees, the CFO said, “we have to continue to be thoughtful about every penny we spend, particularly in today’s environment, since our entire business model of competing with lower fares is based on having lower costs relative to the legacy airlines.” She also said the airline won’t post a full-year profit “after the bumps we faced in the first half of the year with the Omicron variant and operational challenges.” General Electric Jumps Despite Profit Miss General Electric (GE) shares are up 1.9% ahead of the open despite missing Q3 expectations. Here’s how the company’s results compared to analysts’ expectations: Adjusted EPS: $0.35 vs $0.47 expected Revenue: $18.4 billion, in line with estimates GE cut its full-year EPS outlook to between $2.40 and $2.80 vs $2.80 to $3.50 previously. That updated forecast includes a $500 million warranty charge in the company’s renewable power division. The outlook implies $1.23 per share in Q4 earnings vs analysts’ expectations for $1.17. 3M Slashes Outlook 3M (MMM) shares are slipping 2.9% in premarket trade after mixed Q3 results and cutting its full-year outlook. Here’s how the company’s results compared to analysts’ estimates: EPS: $2.69 vs $2.60 expected Revenue: $8.6 billion vs $8.7 billion expected 3M now expects full-year EPS between $10.10 to $10.35 vs $10.30 to $10.80 previously. That implies roughly $8.1 billion in Q4 sales and $2.40 EPS vs Wall Street’s expectations for $8.4 billion in revenue and EPS of $2.55. Key Earnings After the Close Here are the key companies set to report earnings after the close today: Microsoft (MSFT) Alphabet (GOOGL) Chipotle Mexican Grill (CMG) Spotify (SPOT)
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