CAPIS Morning Note – 07/20/23: Stocks Lower On Misses At Netflix and Tesla. Others Notable Beat.

Overnight Summary: The S&P 500 closed Wednesday higher by 0.24% at 4565.72 from Tuesday higher by 0.71% at 4554. Overnight ranges saw the high hit at 4597 at 5:00 p.m. EDT while the low was hit at 4581 at 6:55 p.m. EDT. The range overnight was 16 points. The 10-day average of the overnight range is…

Overnight Summary: The S&P 500 closed Wednesday higher by 0.24% at 4565.72 from Tuesday higher by 0.71% at 4554. Overnight ranges saw the high hit at 4597 at 5:00 p.m. EDT while the low was hit at 4581 at 6:55 p.m. EDT. The range overnight was 16 points. The 10-day average of the overnight range is at 14.60 from 15.30 yesterday.  The average for May/June average was 19.94 from 21.63 in May. Currently, the S&P 500 is lower by  -7.25 points and is lower by -0.15% at 7:15 a.m. EDT.

Earnings Out After The Close

  • Beats: NFLX +0.44, IBM +0.17, AA +0.14, TSLA +0.11, SLG +0.09, CALX +0.05, ZION +0.03, EFX +0.03, CCI +0.03, STLD +0.03, LVS +0.02, FNB +0.01, FR +0.01 of note
  • Flat: KMI, REXR, WTFC of note.
  • Misses: DFS (0.13), COLB (0.12), NBHC (0.07), LBRT (0.03), CNS (0.02), MRTN (0.01) of note.

Unusual Options Activity:

Daily Screen in Erlanger Chartroom that highlights unusual Call and Put Options activity in the S&P 500.  It looks for volume outliers relative to the Open interest in Calls or puts.  Usually, the stock price activity reflects the outlier situation (earnings/buyout/announcement), but once in a while, you can uncover stocks prior to a pop or drop.

Capital Raises:

  • IPOs Priced or News: None of note.
  • New SPACs launched/News: None of note.
  • Secondaries Priced:
    • NCPL: Pricing of Public Offering 1,725,000 shares @$0.70. (ThinkEquity Bookmanager)
  • Notes Priced of note:
    • CNXC: Prices $2.15 Billion Senior Notes Offering for Webhelp Combination.
    • COTY: Prices Upsized $750 Million of Senior Secured Notes.
  • Common Stock filings/Notes:
    • CGC: Filed Form S-1.. 13,218,453 Common Shares.
    • FYBR: Announces Fiber Securitization Offering.
    • HUGE: RW The Registrant requests this withdrawal because the proposed offering of securities contemplated by the Registration Statement has not occurred and will not be proceeding. The Registrant believes that such withdrawal is consistent with the public interest and the protection of investors.
    • NCPL: Announces Proposed Public Offering of Common Stock.
    • UAVS: Filed Form S-1.. 25,080,000 shares.
    • URG: Filed Form 424B5.. Up to $50,000,000 Common Shares.
    • VSEC: Announces Public Offering of Common Stock.
  • Direct Offering: None of note.
  • Selling Shareholders of note:
    • HNRG: Files for 5,262,635 share common stock offering by selling shareholders. (see Mixed Shelf too)
    • WBX: Files for 18,832,432 share common stock offering by selling shareholders.
  • Private Placement of Public Entity (PIPE):
    • FAMI: Announces Closing of US$8.0 Million Private Placement.
  • Mixed Shelf Offerings:
    • FDX: Files mixed shelf securities offering.
    • HNRG: Files for $150 million mixed securities shelf offering.
  • Debt/Credit Filing and Notes:
    • FDX: Filed Form S-3ASR.. Debt Securities Common Stock.
  • Tender Offer: None of note.
  • Convertible Offering & Notes 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 and Over the Holiday:

  • After Hours: 
    • Trading Up: HCCI +8%, ZION +7%, CALX +6%, ELS +4%, REXR +4% of note.
    • Trading Down: DFS -13%, VSEC -8%, BANR -6%, EFX -5%, LBRT -5%, NFLX -5%, NBHC -5%, WTFC -5%, OFLX -4% of note.
  • News Items After the Close:
    • Stocks making the biggest moves after hours: NFLX, IBM, TSLA, UAL, ZION, LVS, DFS (CNBC)
    • Tesla (TSLA) reports 47% rise in sales for its second quarter, but profitability shrinks. (MarketWatch)
    • Musk Says Tesla (TSLA) to Spend Over $1 Billion on Dojo Supercomputer. (Bloomberg)
    • Netflix (NFLX) Subscriber Growth Jumps After Password Curbs. (WSJ)
    • Zions Bancorp (ZION) stock jumps as deposits rebound, profit tops estimates. (MarketWatch)
    • Las Vegas Sands (LVS) beats expectations, helped by tourism rebound, but stock falls. (MarketWatch)
    • United Airlines (UAL) earnings: Even higher 2023 profit expected despite last month’s meltdown. (MarketWatch)
    • Discover (DFS) stock falls more than 13% after company discloses accounting mistake, FDIC probe. (MarketWatch)
    • Wintrust Financial (WTFC) shares fall, as higher deposit costs weigh on results. (MarketWatch)
    • Lockheed Martin (LMT) awarded $221 million U.S. Army Other Transaction Authority agreement.
    • KBR Awarded $69 Million CENTCOM Support Contract through U.S. Air Force.
  • Exchange/Listing/Company Reorg and Personnel News:
    • Index Changes: Equity LifeStyle Properties (ELS) will replace Life Storage Inc (LSI) in the S&P MidCap 400.
    • Atour Lifestyle Holdings Limited (ATAT) Appoints New Co-Chief Financial Officer.
    • Axalta Coating Systems (AXTA) appoints Carl Anderson as CFO.
    • Hamilton Lane (HLNE) appoints Jeffrey Armbrister as CFO, Andrew Schardt as Vice Chairman.
    • Southwest Gas (SWX) Julie Williams steps down as COO to new role with company.
    • Stitch Fix (SFIX) CTO Sachin Dhawan leaving his position.
    • XPO, Inc. (XPO) appoints Kyle Wismans as CFO.
  • Buyback Announcements or News:
    • Armstrong World Industries (AWI) Announces Increase to Share Repurchase Program by $500 million and Quarterly Dividend.
    • Discover Financial Services (DFS) pauses share repurchases.
    • Investar Holding Corporation (ISTR) Announces Additional Authorization Under Share Repurchase Program.
  • Stock Splits or News:
    • Theratechnologies (THTX) Announces 1-for-4 Reverse Stock Split.
  • Dividends Announcements or News:
    • Armstrong World Industries (AWI) (see Buyback)
    • Bank of America (BAC) increases quarterly dividend to $0.24 per share from $0.22 per share. (MarketWatch)
    • Banner Corporation (BANR) Declares Quarterly Cash Dividend of $0.48 Per Share.
    • BlackRock (BLK) Declares Quarterly Dividend of $5.00 on Common Stock.
    • Celanese Corporation (CE) Declares Quarterly Dividend of $0.70 Per Share.
    • Community Bank (CBU) increases quarterly cash dividend 2.27% to $0.45 per share.
    • Kenvue (KVUE) Initiates Quarterly Cash Dividend.
    • Las Vegas Sands (LVS) Reinstates Quarterly Div At $0.20 per share.
    • Regions Financial (RF) increases its quarterly dividend 20% to $0.24 per share. Annual yield of 4.8%.
    • Richardson Electronics (RELL) Declares Quarterly Cash Dividend.
  • Insider Sales Of Note: None of note.

What’s Happening This MorningFutures value reflects the change with fair value.

S&P 500 -5, Dow Jones +54,  NASDAQ -84, and Russell 2000 +6. (as of 7:58 a.m. EDT).  Asia lower ex ASX 200 while Europe higher this morning. VIX Futures are at 15.95 from 15.50 yesterday.  Gold, Silver and Copper higher this morning. WTI Crude Oil and Brent Crude Oil higher as well as Natural Gas. US 10-year Treasury sees yields at 3.787% from 3.762% yesterday. The U.S. Dollar is lower versus the Euro, higher versus the Pound and lower against the Yen. Bitcoin is at $30,388 from $29,973 yesterday, higher by 1.10%.


Sector Action(1/3/6/12/YTD Updated Weekly with Monday release):  

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

Stocks rose Wednesday, bringing an eighth consecutive day of gains for the Dow, as bank results and easing inflation overseas helped sustain the recent rally.  The Dow Jones Industrial Average added 109.28 points, or 0.3%, to finish at 35061.21 for its longest streak of gains since 2019. The broad S&P 500 index climbed 0.2%, led by real-estate and utility shares. The tech-centric Nasdaq added less than 0.1%.  A pack of regional banks including U.S. Bancorp (USB), M&T Bank (MTB) and Citizens Financial Group (CFG) reported that deposits stabilized in the second quarter after March’s string of bank failures. That helped ease investors’ concerns that continuing outflows could ripple through the economy and make it harder for businesses and families to get loans. U.S. Bancorp rose 6.5%, M&T added 2.5% and Citizens gained 6.4%.  (WSJ – edited by QPI)

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

  • Thursday After the Close: 

  • Friday Before the Open:

Earnings of Note This Morning:

  • Beats: DHI +1.07, TCBI +0.38, AAL +0.33, SNA +0.31, JNJ +0.18, PM +0.10, GPC +0.10, MMC +0.08, WNS +0.08, ABT +0.03, WBS +0.03, KVUE +0.02, MKTX +0.02, BX +0.01 of note.
  • Flat: None of note.
  • Misses: TRV (1.99), POOL (0.23), NEM (0.08), TFC (0.08), KEY (0.05), MAN (0.04), BHLB (0.02), FITB (0.01) of note.
  • Still to Report: BMI , EWBC , FCX , HOMB , NOK , SAP , TSM of note.


  • Positive Guidance: UAL, SEM, JNJ, DHI of note.
  • Negative Guidance: EFX, REXR, PM, POOL, MAN of note.

Erlanger Research Advance/Decline Chart:

Gap Ups & Down In Early Pre-Market:

  • Gap Up: NBTX +8%, HCCI +7%, ELS +4%, ZION +4%, HCM +4%, SEM +4% of note.
  • Gap Down: DFS -13%, VSEC -6%, BANR -6%, NFLX -6%, EFX -5%, NBHC -5%, LBRT -5%, CCI -5%, LVS -4% of note.

Insider Action: No stock sees Insider buying with dumb short selling.  No stock sees Insider buying with smart short sellers.

Rags & MagsRepeated stories from prior days never listed, i.e. “rehashed news”. Sorted by Global, U.S. and stock specific.

  • Stocks Making The Biggest Moves: NFLX, TSLA, UAL, JNJ, IBM, LVS (CNBC)
  • Five Things to Know Before The Stock Market Opens This Morning (CNBC)
  • Five Things You Need to Know to Start Your Day. (Bloomberg)
  • Bloomberg Lead Story: Blackstone’s $1 Trillion Triumph is Muted By Slowdown in Deals. (Bloomberg)
  • Bloomberg Most Shared Story: A $500 Billion Corporate Debt Storm Builds Over Global Economy. (Bloomberg)
  • NASDAQ futures slump as Netflix dents tech shine: Market Wrap. (Bloomberg)
  • Turkey raises rates to 17.75%, less than expected. (CNBC)
  • NASDAQ 100 futures drop as Netflix falls on earnings report. (CNBC)
  • Taiwan Semiconductor (TSM) saw profits plunge on lower demand for consumer electronics, first drop in 4 years. (CNBC)
  • Johnson & Johnson (JNJ) beat on earnings, raises full year guidance as med tech sales surge. (CNBC)
  • American Airlines (AAL) raises profit forecast for rest of 2023. (CNBC)
  • Fifth Third (FITB) beat estimates on better than expected interest income. (Reuters)
  • D.R. Horton (DHI) raises revenue forecast and beat on estimates. (Reuters)
  • NPR Most Recent Business Podcast: Stay cool out there. Air conditioners are cranked and grids are straining as much of the country grapples with a heat wave. Why Chipotle is expanding to small-town America and what worries legal pros about the spread of AI-powered tools.

Moving Average Update:

  • Day 7 at 100%.  Just wow!


  • President’s Public Schedule:
    • The President receives the Presidential Daily Briefing, 9:00 a.m. EDT
    • The President departs the White House en route to Joint Base Andrews and arrives in Philadelphia, Pennsylvania, 10:20 a.m. EDT
    • The President participates in a tour of Philly Shipyard, 12:05 p.m. EDT
    • The President discusses how his Bidenomics agenda is growing the economy from the middle out and the bottom up, 1:00 p.m. EDT
    • The President departs Philadelphia, Pennsylvania at 2:15 p.m. EDT en route to Joint Base Andrews and arrives at the White House at 3:30 p.m. EDT


  • Initial Jobless Claims 8:30 a.m. EDT
  • July Philadelphia Fed Index is due out at 8:30 a.m. EDT and is expected to improve to -9.0 from -13.70.
  • June Existing Home Sales are due out at 10:00 a.m. EDT and are expected to fall to 4.25 million from 4.30 million.
  • June Leading Indicators are due out at 10:00 a.m. EDT and are expected to improve -0.6% from -0.7%.
  • EIA Natural Gas Report 10:30 a.m. EDT

Federal Reserve / Treasury Speakers:

  • The Fed Blackout Period has begun. No Fed speakers between now and the FOMC Wed. 07/26/23.

M&A Activity:

  • Dell Technologies (DELL) To Buy Moogsoft.
  • Heritage-Crystal Clean, Inc. (HCCI) to be Acquired by J.F. Lehman & Company for $1.2 Billion.

Meeting & Conferences of Note:

  • Sellside Conferences: None of note.
      • Previously posted and ongoing conferences:
  • Top Shareholder Meetings: BIOL, EAC, KNSW
  • Fireside Chat: None of note.
  • Investor/Analyst Day/Calls: AIR, GFOR, IMUX, VWE
  • Update: None of note.
  • R&D Day: None of note.
  • Company Event:
  • Industry Meetings:

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 is 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:

Previous Day’s Upgrades and Downgrades: