Overnight Summary: The S&P 500 closed Wednesday at 3933.92 (lower by -0.19%) from Tuesday at 3941.26 (lower by -1.44%). The overnight high of 3947.50 was hit at 6:50 a.m. EST. The low was hit at 3916.00 at 8:16 p.m. EST, a range of ~31 points high to low. At 7:00 a.m. EST, the S&P 500 (mini) was up +9.
Earnings Out After The Close:
- Beats: OXM +0.24, HCP +0.18, VRNT +0.08, AI +0.05, SPWH +0.05, DSGX +0.04.
- Flat: None of note.
- Misses: GEF (0.11),GME (0.03).
Unusual Options Activity:
Daily Screen in Erlanger Chartroom that highlights unusual Call and Put Options activity. 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 awhile you can uncover stocks prior to a pop or drop.
- IPOs Priced or News: None of note.
- New SPACs launched/News:
- ROC Energy Acquisition Corp. (ROC) Confirms Funding and Extension of Deadline to Complete Initial Business Combination.
- Secondaries Priced:
- CABA: Announces offering of 6,213,776 shares at a price of $5.52 per share for aggregate proceeds of $35 million.
- Notes Priced of note:
- CUTR: Announces the pricing of $100 mln aggregate principal amount of 4.00% convertible senior notes due 2029.
- UNIT: Announces Pricing of Convertible Notes Offering.
- Common Stock filings/Notes:
- ARDS: Filed Form S-1.. 7,207,208 Shares Common Stock.
- BTTX: Filed Form S-1.. Common Stock.
- GTLS: Commences concurrent offerings of $600 million of common stock and $300 million of depositary shares of Series B Mandatory Convertible Preferred Stock
- INM: Filed Form S-1.. 5,090,918 Common Shares.
- REPL: Proposed Public Offering.. $125 million of shares. (JPM and SVB Bookmanager)
- RXDX: Proposed Public Offering of Common Stock.. $250 million of shares. (GS, SVB, Jefferies and Guggenheim bookmanager)
- Direct Offering: None of note.
- Selling Shareholders of note:
- ESEA: Filed Form F-3.. 4,041,943 of our Common Shares Offered by the Selling Shareholders.
- Private Placement of Public Entity (PIPE):
- SABS: Announces $7.9 Million Private Placement of Common Stock.
- Mixed Shelf Offerings:
- GM: Filed Auto Mixed Shelf.
- Debt Filing/Notes:
- AVB: Completes $350 Million Senior Notes Offering.
- Tender Offer: None of note.
- Convertible Offering & Notes Filed:
- CHEF: Announces Offering of $250 Million of Convertible Senior Notes Due 2028.
- CUTR: Proposed Private Offering of $100 Million of Convertible Senior Notes.
- NEP: announces offering of $500 million in aggregate principal amount of convertible senior notes due 2026.
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: HCP +8%, BZFD +5%, OXM +4%.
- Trading Down: RLMD -37%, DSGN -34%, CUTR -14%, CHEF -7%, SPWH -5%, GEF -5%, NEP -4%, SNY -4%, VRNT -4%.
- News Since The Close:
- Texas Governor Greg Abbott has said: I’ve banned TikTok on state issued devices. I’m also calling for legislation to make the ban permanent and to broaden the ban.
- Google (GOOG), Oracle (ORCL), Amazon (AMZN), and Microsoft (MSFT) win $9 billion joint DOD contract. (Bloomberg)
- Chevron (CVX) sees 25% jump in spending for 2023, excluding acquisitions. (MarketWatch)
- Transocean Ltd. (RIG) Announces $1.04 Billion in Contract Awards for Two Ultra-Deepwater Drillships.
- Exchange/Listing/Company Reorg and Personnel News:
- Alvotech (ALVO) shares move to Nasdaq Iceland Main Market.
- Alpha and Omega Semiconductor (AOSL) Announces Executive Leadership Transition.
- Custom Truck One Source (CTOS) Announces CEO Transition Plan.
- Eargo (EAR) Announces Strategic Additions to Board of Directors Following Patient Square Capital Becoming New Majority Shareholder.
- Genuine Parts (GPC) appoints William Stengel to expanded role as President and COO.
- GeoVax (GOVX) Appoints Jayne Morgan, M.D., to its Board of Directors.
- WM Technology (MAPS) Chief Technology Officer Justin Dean tendered his resignation from his role.
- Nordstrom (JWN) appoints Michael Maher, its Senior Vice President and Chief Accounting Officer, as interim CFO.
- The Duckhorn Portfolio (NAPA) CFO Lori Beaudoin intends to retire in the spring of 2023.
- PBF Energy (PBF) announces appointment of Karen Davis as interim CFO.
- SPX Technologies (SPXC) Announces Appointment of Mark Carano as Chief Financial Officer.
- Buyback Announcements or News:
- CarGurus (CARG) announces $250 million repurchase program.
- Criteo (CRTO) announces the extension of its share repurchase authorization from $280-480 million.
- Landstar System (LSTR) increases stock repurchase authorization to 3.0 million shares of common stock (see Dividends)
- Verint Systems (VRNT) announces new $200 million share buyback program.
- Exxon (XOM) share-repurchase program expanded up to $50 billion through 2024.
- Stock Splits or News:
- LCFY trading r/s price.
- My Size (MYSZ) Announces Reverse Stock Split.
- UpHealth (UPH) Announces Reverse Stock Split Will Effect Changes to Warrant Terms.
- Dividends Announcements or News:
- Adams Diversified Equity Fund (ADX) Announces $15.01 Issue Price of Shares for Year-End Distribution Payable December 21, 2022.
- Adams Natural Resources Fund (PEO) Announces $21.40 Issue Price of Shares for Year-End Distribution Payable December 16, 2022.
- Carrier (CARR) Board of Directors Increases Quarterly Dividend by 23%.
- Coca-Cola Consolidated (COKE) doubles regular quarterly dividend to $0.50 per share from $0.25 per share;. Company also declares a special cash dividend of $3.00 per share.
- CubeSmart (CUBE) increases quarterly dividend 14% to $0.49 per share, a $0.07 bump.
- Erie Indemnity (ERIE) increases its quarterly dividend 7.2% to $1.19 per shares.
- FDX Goes ex div tomorrow for $1.15.
- Landstar System (LSTR) declares one-time special cash dividend of $2.00 per share.
- PDC Energy (PDCE) declares special dividend of $0.65 per share.
- VFC Goes ex div tomorrow for $0.51.
What’s Happening This Morning: Futures value reflects the change with fair value.
S&P 500 +13, Dow Jones +86, NASDAQ +40, and Russell 2000 +7. (as of 7:55 a.m. EST). Asian markets were mixed, but the Hang Seng was up 3.4% as they loosen coronavirus quarantine requirements and ease entry restrictions (see Bloomberg story below in Rags/Mags). Europe markets are trading slightly down. European Central Bank staff is reportedly considering a strike after being offered pay raises below the rate of inflation. VIX Futures are at 22.77 (up +0.4%). Gold up a hair and Silver down a….sliver. WTI Crude Oil and Brent higher with Natural Gas higher as well. $ is flat. US 10-year Treasury sees yields at 3.46%. The U.S. Dollar is slightly higher versus the Euro, a touch lower versus the Pound and higher against the Yen. Bitcoin is at $16,826 from $16,791.
Sector Action – (1/3/6/12/YTD Updated Weekly with Monday release):
- Daily Positive Sectors: Healthcare of note.
- Daily Negative Sectors: Communication Services, Consumer Cyclical, Energy, technology, Financial of note.
- One Month Winners: Basic Materials,Communication Services, Technology of note.
- Three Month Winners: Basic Materials, Industrials, and Healthcare of note.
- Six Month Winners: Industrials, Consumer Defensive, Healthcare of note.
- Twelve Month Winners: Energy, Utilities, and Consumer Defensive of note.
- Year to Date Winners: Energy of note.
U.S. stocks inched mostly down Wednesday, with investors continuing to worry that stronger-than-expected economic data will prompt officials to hold interest rates higher for longer, potentially weighing on the economy next year. The S&P 500 was down 7.34 points, or 0.2%, to 3933.92, suffering its fifth consecutive day of losses. The tech-focused Nasdaq Composite fell 56.34 points, or 0.5%, to 10958.55. The Dow Jones Industrial Average added 1.58 points, or less than 0.1%, to 33597.92. (WSJ)
Click here for a video explanation of Erlanger Value Lines.
Upcoming Earnings Of Note: (sorted by market cap, highest to lowest with most visible names)
- Thursday After the Close: AVGO, COST, LULU, CHWY, COO, MTN, DOCU, RH, FIZZ, PHR, DOMO, CURV of note.
- Friday Before the Open: None of note.
Earnings of Note This Morning:
- Beats: CIEN +0.54, MOMO +0.52, GMS +0.45, KFY +0.02.
- Flat: None of note.
- Misses: None of note.
- Still to Report: MANU.
- Positive Guidance: HCP of note.
- Negative Guidance: VRNT, SPWH,AI, KMI, KFY of note.
Erlanger Research Advance/Decline Chart:
Gap Ups & Down In Early Pre-Market:
- Gap Up: MOMO +21%, RXDX +8%, HCP +6%, GMS +5%, BZFD +5%, OXM +4% of note.
- Gap Down: RLMD -40%, DSGN -27%, CUTR -10%, CHEF -7%, SPWH -6%, GEF -5%, GTE -5% of note.
Insider Action: BALL sees Insider buying with dumb short selling. AZYO, CVV sees Insider buying with smart short sellers.
Rags & Mags: Repeated stories from prior days never listed, i.e. “rehashed news”. Sorted by Global, U.S. and stock specific.
- Stocks making the biggest moves premarket: CIEN, GME, RENT, OXM, UL, KMI, CANO, EXPR (CNBC)
- 5 things to know before the stock market opens. (CNBC)
- Five Things You Need to Know to Start Your Day. (Bloomberg)
- Bloomberg Lead Story: The Federal Reserve Is Deflating Financial Bubbles, Without a Crash. (Bloomberg)
- Bloomberg Most Read Story: Peru’s President Accused of Coup After Move to Dissolve Congress. (Bloomberg)
- China’s Xi Jinping Meets Saudi Crown Prince in Pivotal Visit. (WSJ)
- Hong Kong May End Outdoor Mask Rule, Relax Covid Tests, Report Says. (Bloomberg)
- New York Times (NYT) Employees Are Walking Out Over Pay Dispute. (Bloomberg)
- Google (GOOG)Combines Maps and Waze Teams Amid Pressure to Cut Costs. (WSJ)
- US Sides Against Google (GOOG) in Consequential Social Media Case. (Bloomberg)
- Surging retail theft could force Walmart (WMT) to close stores and raise prices, CEO Doug McMillon warns. (NYPost)
Moving Average Update:
- President’s Public Schedule:
- The President receives the Presidential Daily Briefing, 9:00 a.m. EST
- The President and The Vice President have lunch, 12:15 p.m. EST
- Press Briefing by Press Secretary Karine Jean-Pierre, 12:30 p.m. EST
- The President delivers remarks on building a stronger economy for union workers and retirees; The Secretary of Labor attends, 2:10 p.m. EST
- Initial Jobless Claims 8:30 a.m. EST (Expecting 230k, Expecting 1.6 Million continued claims)
- Quarterly Services 10:00 a.m. EST
- EIA Natural Gas Report 10:30 a.m. EST (Expecting -31bcf)
Federal Reserve / Treasury Speakers:
- IBM to Acquire Octo.
- Unilever (UL) mulls $3 billion sale of some U.S. ice cream brands. (Bloomberg)
- United Rentals (URI) Completes Acquisition of Ahern Rentals.
Meeting & Conferences of Note:
- Sellside Conferences:
- Bank of America Virtual Lithium and Battery Storage Conference 2022 (12/08/22-12/09/22)
- Cantor Fitzgerald Medical & Aesthetic Dermatology, Ophthalmology & MedTech Conference 2022
- Goldman Sachs Autos Conference 2022 (12/08/22-12/09/22)
- Goldman Sachs Credit Outlook Conference
- Jefferies Consumer Finance Summit
- Macquarie Ad Tech C-Suite Virtual Day 2022
- Truist Securities Gaming, Lodging, Leisure and Restaurants Summit 2022
- Previously posted and ongoing conferences:
- Bank of America Biotech SMID Cap Conference (12/07/22-12/08/22)
- Barclays Global TMT Conference (12/07/22-12/08/22)
- Citigroup Global Consumer Conference (12/06/22-12/08/22)
- Cowen 5th Annual Cannabis Conference 2022 (12/06/22-12/08/22)
- Credit Suisse Mexico Infrastructure Conference
- DA Davidson Fintech and Payment Solutions Conference
- John Tumazos Very Independent Research
- Roth Sustainability Private Capital Event
- Sidoti December Micro Cap Conference (12/07/22-12/08/22)
- SVB Securities Biopharma Spotlight: Global Large Cap
- Wells Fargo Midstream, Utilities & Renewable Power (12/07/22-12/08/22)
- Company Meetings: CSCO, DQ, SHAC
- Fireside Chat: AVY, HAS, IRIX, IMVT.
- Investor/Analyst Day/Calls: ASXC, DCO, EIGR, EW, GE, KMT, LUV, MCRB, ML, ROG, WPRT, XOM
- Update: None of note.
- R&D Day: None of note.
- Company Event: None of note.
- Industry Meetings:
- Healthcare Supplier Diversity Alliance Annual Meeting 2022
- Previously posted and ongoing conferences:
- International Union of Nutritional Sciences International Congress of Nutrition (IUNS-ICN) 2022 (12/06/22-12/11/22)
- San Antonio Breast Cancer Symposium (SABCS) 2022 (12/06/22-12/10/22)
- Advanced Automotive Battery 22nd Annual Conference (AABC) 2022 (12/05/22-12/08/22)
- IEEE Globecom 2022 (12/04/22-12/08/22)
- Sequire Medical Technology Conference 2022 (11/30/22-12/08/22)
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:
Previous Day’s Upgrades and Downgrades: