CAPIS Morning Note – 02/02/22: Stock Futures Higher This Morning As The Ground Hog Sees His Shadow. Six More Weeks Of Winter.

Please note: Chinese markets are closed for the week because of the Lunar New Year holiday. However, Chinese ETFs and ADRS in the U.S. markets still will trade. Breaking News: Companies unexpectedly cut 301,000 jobs in January as omicron slams jobs market, ADP says (CNBC) Overnight Summary: Asia was strong as Japan has been higher…

Please note: Chinese markets are closed for the week because of the Lunar New Year holiday. However, Chinese ETFs and ADRS in the U.S. markets still will trade.

Breaking News: Companies unexpectedly cut 301,000 jobs in January as omicron slams jobs market, ADP says (CNBC)

Overnight Summary: Asia was strong as Japan has been higher the last three days. Europe is higher as well. The S&P 500 has continued to move higher from the close of trading yesterday and sees S&P 500 futures at the overnight high at 4573 up +38.50 or 0.85%.

Earnings Out After The Close:

  • Beats: GOOG +3.34, CB +0.53, HMN +0.24, HRB +0.23, PKI +0.23, LFUS +0.22, GM +0.20, EA +0.18, AMD +0.16, ZWS +0.11, MANH +0.10, SMCI +0.10, ASH +0.04, UNM +0.04, OI +0.03, DOX +0.02, TENB +0.02, EQR +0.02, APAM +0.01.
  • Flat: None of note.
  • Misses: MSTR (9.90), MTCH (1.20), GILD (0.92), EHC (0.08), SBUX (0.08), IEX (0.05), AMCR (0.04), MRCY (0.03), PYPL (0.01).

Capital Raises:

  • IPOs Priced or News: None of note.
  • New SPACs launched/News: None of note.
  • Secondaries Priced: None of note.
  • Notes Priced of note: None of note.
  • Common Stock filings/Notes:
    • AVCT: Filed Form S-3.. 3,778,635 Shares of Common Stock.
      BWMN: Filing of Registration Statement for Proposed Follow-on Public Offering 1,776,650 shares.. Davidson and B.Riley bookmanager.
  • Pricing of Over-Allotment: None of note.
  • Direct Offering: None of note.
  • Selling Shareholders of note:
    • MSGM: Filed Form S-3.. $100,000,000… 7Million shares common stock offered by selling shareholder.
    • BWMN: Filing of Registration Statement for Proposed Follow-on Public Offering 406,1000 shares by selling shareholders.. Davidson and B.Riley bookmanager
  • Private Placement of Public Entity (PIPE): None of note.
  • Mixed Shelf Offerings:
    • PHUN: Filed Form S-3.. $200,000,000 Mixed Shelf.
  • Convertible Offering & Notes Filed:
    • FLL: Pricing of Senior Secured Notes Offering.
  • Note Offerings Filed: None of note.

Capital Raise Summary From The TradeXchange, bringing traders and investors real time news and Squawk Box, and other sources.

News After The Close:

  • After Hours: 
    • Trading Up: EQR 16%, XLNX 10%, AMD 10%, GOOG 9%, TENB 6%, ATEN 4%.
    • Trading Down: ELMS -24%, AZTA -10%, MRCY -8%, MTCH -5%, OI -5%, GILD -4%.
  • News After The Close:
    • Federal Reserve St. Louis President James Bullard sees three successive hikes to start policy tightening. (Reuters)
    • SBUX “Impacted by Greater-Than-Anticipated Inflation, COVID-19 Related Pay and Staffing Costs.”
    • Assets Under Management (AUM) begin to roll in with drops across the board from APAM.
    • General Motors (GM) will not reinstate dividend at this time.
    • Pfizer (PFE) formally requests emergency-use authorization for its COVID-19 vaccine for kids 6 months through 4 years of age.
    • EA CEO says Battlefield 2042 launch didn’t meet expectations.  CEO cites ‘unanticipated performance issues’ on Battlefield.  EA says Battlefield disappointment was offset by APEX, FIFA.
    • The US debt has officially crossed over $30 trillion for the first time ever.
  • Exchange/Listing/Company Reorg and Personnel News:
    • Dave (DAVE) Appoints Michael Pope to Board of Directors.
    • Electric Last Mile Solutions (ELMS) announces James Taylor resigned as CEO.  Board Member Shauna McIntyre has been named interim CEO.
    • Seanergy Maritime (SHIP) Announces Receipt of Nasdaq Notice.
  • Buyback Announcements:
    • Amcor (AMCR) increases share buybacks by $200 million.
    • CVB Financial Corp. (CVBF) Announces Authorization of 10 Million Share Repurchase Plan, including $70 Million Accelerated Share Repurchase.
    • Sally Beauty Holdings (SBH) Share Repurchases of $75 Million.
    • Bath & Body Works (BBWI) ups repurchase program by $1.5 billion.
  • Stock Splits:
    • GOOGL: 20 for 1 Stock Split.
  • Dividends Announcements:
    • Artisan Partners Asset Mgmt (APAM) declares special dividend of $0.72 per share.
    • Barings BDC (BBDC) increases quarterly cash dividend $0.01 to $0.23 per share.
    • CSG Systems (CSGS) raises dividend.
    • D.R. Horton (DHI) declares dividend.
    • Evercore (EVR) Quarterly Dividend of $0.68 Per Share.
    • Gilead Sciences (GILD) increases quarterly cash dividend $0.02 to $0.73 per share.
    • Kimco Realty (KIM) increases quarterly cash dividend $0.02 to $0.19 per share.
    • Midland States Bancorp (MSBI) increases quarterly cash dividend $0.01 to $0.29 per share.
    • Bath & Body Works (BBWI) ups dividend by 33%.

What’s Happening This Morning: Futures value reflects the change with fair value.

S&P 500 +31 , Dow Jones +29, NASDAQ +204 and Russell 2000 +1.  Asia higher ex Shanghai and Europe higher. VIX Futures are at 21.49 from 24.85  yesterday morning. Gold, Silver and Copper higher. WTI Crude Oil and Brent Oil Futures higher. Natural Gas is higher. $ is higher vs Euro, higher vs Pound and lower vs Yen. US 10 year Treasury with yields 1.80%. As of 8:35 a.m. EST

Monday’s Action – 02/01/22 Close:  

  • Daily Positive Sectors: Energy, Basic Materials, Financial, Communication Services, Industrials of note.
  • Daily Negative Sectors: Utilities, Real Estate of note.
  • One Month Winners: Energy and Financial of note.
  • Three Month Winners: Energy, Consumer Defensive and Utilities of note.
  • Six Month Winners: Energy, Financial, and Utilities of note.
  • Twelve Month Winners: Energy, Real Estate, and Financials of note.
  • Year to Date Winners: Energy of note.

Thanks to a strong finish into the close, indexes continued to extend its rebound rally into February.  Russell 2000 was up 1.10%.  Updated 02/02/22 close.

Upcoming Earnings Of Note: (sorted by market cap, highest to lowest with most visible names)

  • Wednesday After the Close: FB, QCOM, TMUS, MET, CTSH, AFL, SPOT, ALGN, MCK, ALL, AVB, CTVA, MAA, ESS, HOLX, QRVO, FBHS, LNC, WFG, RRX, UGI, DXC, TTEK, OHI, OMF, CHNG, RYN, CCMP, MTG, THG, MXL, ENSG, SITM, SKY, KLIC, ALGT, FORM, EPAY, BDN, CCS, CORT, EGHT, ELF, CLB, TBI, ADTN, NTGR, YELL  of note.
  • Thursday Before the Open: BABA, LLY, MRK, HON, COP, EL, CI, ABB, BDX, ITW, ICE, BCE, LHX, HSY, PH, BIIB, NOK, CMI, AME, WEC, FTV, GWW, XYL, CMS, CG, DGX, CHKP, CAH, ABMD, MPW, WRK, SNA, HUBB, PSXP, BERY, ARW, RL, COR, PENN, INGR, JHG, LSPD, ROLL, HBI, AZEK, TKR, HAYW, MMS, LAZ, SNDR, LANC, WD, MSGS, NJR, FCFS, HAIN, VSAT, PBH, VSTO, NS, MTOR, DLX, CSII of note.

Earnings of Note This Morning:

  • Beats: EVR +2.59, TMO +1.27, MPC +0.74, CPRI +0.53, DHI +0.37, SLAB +0.20, EAT +0.20, SAIA +0.19, ODFL +0.14, ATI +0.14, RACE +0.13, IDXX +0.11, HUM +0.08, NYT +0.08, GIB +0.07, SBH +0.04, MPLX +0.04, EMR +0.04, BIP +0.04, ABBV +0.03, ROP +0.03, DT +0.02, HWM +0.01, BSX +0.01, JCI +0.01, AVY +0.01.
  • Flat: WM +0.00, ABC +0.00.
  • Misses: SR (0.18), SPR (0.18), CHRW (0.12), WNC (0.05), VNE (0.02), NVS (0.02).
  • Still to Report: CRS, MMP.

Guidance:

  • Positive Guidance: ALGM, ATEN, EQR, AMD, OI, SMCI, IEX, LFUS, HUM, WNC, SLAB, BBWI, ABBV.
  • Negative Guidance: POWW, MRCY, GILD, DOX, MTCH, PYPL, EHC, SBUX, BSX, EMR, HWM, WM.

Erlanger Research Advance/Decline Chart: Updated through 02/01/22 close.

Gap Ups & Down In Early Pre-Market:

  • Gap Up: AMD +11%, XLNX +10%, GOOG +10%, APAM +8%, ATEN +7%, MPC +5%, SONY +5%, TENB +4%, EQR +4%.
  • Gap Down: ELMS -27%, PYPL -17%, AZTA -10%, MRCY -9%, EHC -7%, OI -4%, MTCH -4%.

Insider Action: SPRO, MNRO, SAFE sees Insider buying with dumb short selling. MACK sees Insider buying with smart short sellers. 02/01/22 close.

Rags & Mags: Repeated stories from prior days never listed, i.e. “rehashed news”.

  • Stocks Making The Biggest Moves: CPRI, BSX, EAT, GOOGL, DHI, WM.  (CNBC)
  • 5 Things To Know To Start Your Day. (Bloomberg)
  • 5 Things To Know This Morning. (CNBC)
  • Covid-19 Cases no change as Tuesday data partial 676,874 cases from 1,140,580 cases a week ago while hospitalizations actually fell to 129,637 from 142,815. (CDC)
  • Russian President Putin will agree to engage in diplomacy on the Ukraine and Eastern Europe. (NYT)
  • Russia to up oil production but lower than the OPEC+ level. (Bloomberg)
  • Russian President Putin meets with Chinese President Xi this week. (NYT)
  • House to vote on a procedural vote today and the actual vote on Friday over the China Competition Bill. (Reuters)
  • White House seeks to reduce cancer death rate by 5% by 2047 and improving the quality of life for patients. (White House Release)
  • Amazon (AMZN) at an Alabama distribution center to vote a second time on union membership as the trend continues at Amazon and others like Starbucks. (WSJ)
  • Robinhood Snacks looks at the strong profits in the Energy patch. Tom Brady retires from NFL to become a cyptoprenuer.

Moving Average Update:

  • Score continues to improve.  Currently at 56% from 50%. Updated 02/01/22 close.

Geopolitical: 

  • President’s Public Schedule:
    • The President and The Vice President receive the President’s Daily Brief, 10:15 a.m. EST
    • Press Briefing by Press Secretary Jen Psaki, 12:30 p.m. EST
    • The President, The Vice President, and The First Lady host an event at the White House to reignite the Cancer Moonshot; The Second Gentleman also attends, 1:30 p.m. EST
    • Press Briefing by White House COVID-19 Response Team and public health officials, 3:00 p.m. EST.

Economic: 

  • MBA Mortgage Applications 7:00 a.m. EST
  • January ADP Employment Index is due out at 8:15 a.m. EST and is expected to fall to 220,000 from 807,000.
  • EIA petroleum Report 10:30 a.m. EST

Federal Reserve Speakers:

  • None of note.

M&A Activity:

  • Carlisle Cos (CSL) announces the acquisition of MBTechnology.
  • CyrusOne (CONE) Stockholders Approve Acquisition by KKR and Global Infrastructure Partners.
  • Fortune Brands Home & Security (FBHS) acquired Solar Innovations.
  • NeoPhotonics (NPTN) Stockholders Approve Merger Agreement with Lumentum (LITE).
  • Tenable (TENB) Agrees to Acquire Cymptom.
  • Online Automotive Retailer Vroom (VRM) Successfully Completes Acquisition of United Auto Credit Corporation.

Meeting & Conferences of Note:

  • Sellside Conferences:
    • Alliance Emerging Growth Technology Conference
    • Citi’s Psychedelic Drug Call Series 2022 (02/02/22-02/08/22)
    • Janney West Coast CEO Forum 2022 (CBAN, SYBT, CSTR) (02/02/22-02/03/22) 
      • Previously Announced  Conferences:
        • Credit Suisse Latin America Investment Conference 2022 (02/01/22-02/03/22)
        • Keystone Symposia Conference: Antibodies as Drugs 2022 (01/30/22-02/02/22)
  • Company Meetings: None of note.
  • Fireside Chat: None of note.
  • Investor/Analyst Day/Calls: ATEN, ATHX, TREE
  • Update: None of note.
  • R&D Day: None of note.
  • Company Event: None of note.
  • Industry Meetings:  
    • 44th Annual Pulmonary and Allergy Update at Keysone 2022 (02/02/22-02/05/22)
    • Transplantation & Cellular Therapy Meetings of ASTCT and CIBMTR Tandem Meetings 2022 (02/02/22-02/06/22)
      • Previously Posted and Ongoing Conferences:
        • International Mining and Resources Conference (IMARC) (01/31/22-02/02/22)

Top Tier Sell-side Upgrades & Downgrades:

The recommendations listed below in this “Upgrade/Downgrade” section are compiled from what we believe are Tier I, II and III firms. Recommendations posted are taken from a variety of sources each day and we only post upgrades or significant initiations as well as downgrades to underweight or sell. The purpose of this posting it to make the reader aware of market moving recommendations. None of these recommendations should be interpreted as actual recommendations from CAPIS or its employees.

Today’s Upgrades and Downgrades:

      

Tuesday’s Upgrades and Downgrades: