Earnings mixed | Morning news

APRIL 17, 2015

US futures tumbling with Europe pulling back on renewed concerns in Greece and negative regulatory news out of China. Traders digest a mixed week of earnings and await key data on inflation before the opening and consumer sentiment later in the morning. Oil prices gave back their overnight gains after OPEC  data reported a rise in production. Following a string of disappointing US economic data, the dollar is hovering near a one-week low against a basket of major currencies and is on track for its biggest weekly drop in a month.

NEWS:

  • BLOOMBERG reports widespread terminal outages
  • CHINA  regulators announce renewed oversight on the use of margins for equities trading: regulators to allow institutional traders to lend shares for short selling and increased the number of stocks that can be shorted
  • MTW: announced guidance for Q1 below consensus and lowers expectation for its food service revenue
  • AMZN: out positive on Amazon: reaffirms $475, reports streetinsider
  • HAL:Halliburton Co has hired Bank of America Corp and Deutsche Bank AG to assist in the sale of two businesses that could be valued at as much as $5 billion collectively, reports reuters
  • ONCY: FDA grants orphan drug designation to its malignant glioma drug, Reolysin
  • AZN: FDA grants orphan drug designation to its eye cancer drug, selumetinib
  • RTN: announces $2B+ contract for Patriot air and missile defense system
  • MNGA: explosion at Tarpon Springs plant kills one
  • ATHX: Multistem fails to meet primary endpoint in trial

ON THE ECONOMIC CALENDAR:

  • 8:30AM: Consumer Price Index: expectation +.03%: ACTUAL +.02%
  • 8:30AM: Core CPI: expectation +.02%: ACTUAL +.02%
  • 9:55AM: Reuters/UofM Consumer Sentiment: expectation 93.5
  • 10AM: Leading Indicators

EARNINGS:

  • GE:Q1 EPS of $0.31 beats by $0.01.Revenue of $29.36B (-12.5% Y/Y) misses by $4.87B: conference call 8:30AM EST
  • RAI:Q1 EPS of $0.86 beats by $0.06.Revenue of $2.06B (+6.2% Y/Y) beats by $80M: FY15 guidance at low end of estimates: FY15 adjusted EPS of $3.65-$3.80, consensus $3.79
  • STX:FQ3 EPS of $1.08 beats by $0.04.Revenue of $3.33B (-2.3% Y/Y) misses by $70M
  • HON:Q1 EPS of $1.41 beats by $0.02.Revenue of $9.21B (-4.9% Y/Y) misses by $270M: guidance lowers FY15 Aerospace sales from $15.4B-$15.7B to $15B-$15.3B; conference call 9:30AM EST

SOME NOTABLE EARNINGS FROM YESTERDAY AFTER HOURS:

  • AMD:Q1 EPS of -$0.09 misses by $0.04.Revenue of $1.03B (-26.4% Y/Y) misses by $20M
  • SLB:Q1 EPS of $1.06 beats by $0.15.Revenue of $10.25B (-8.8% Y/Y) misses by $210M: cuts 11K jobs: expectation of tightening supply in Q3
  • AXP:Q1 EPS of $1.48 beats by $0.11.Revenue of $7.95B (-3% Y/Y) misses by $260M: guided flat to lower: results were hurt by the strong dollar
  • MAT:Q1 EPS of -$0.08 beats by $0.01.Revenue of $922.7M (-2.5% Y/Y) beats by $26.16M
  • NOW: Q1 EPS of $0.01 beats by $0.01.Revenue of $211.96M (+52.4% Y/Y) beats by $1.15M: guided below expectations: Q2 revenue of $237M-$242M vs. a $242M consensus

ANALYSTS’ RATINGS CHANGES:

UPGRADES:

  • ULTA: upgrade; hold to buy: Nomura: pt raised from $138 to $177
  • PENN: upgrade: neutral to overweight: JPM: pt lifted from $16 to $18

DOWNGRADES:

  • GS: downgrade: outperform to market perform: Keefe Bruyette: $210
  • TRV: downgrade: overweight to equal weight: Barclays $117
  • ZUMZ: downgrade: buy to neutral: B Riley: pt cut from $44 to $40

INITIATIONS:

  • CYTR: initiated: outperform: Oppenheimer:
  • SPLK: initiated: buy: DA Davidson: $83
  • DATA: initiated: buy: DA Davidson: $127
  • ICPT: initiated: buy: UBS: $465
  • AAPL; initiated: outperform: FBR: $185
  • CYBR: initiated: outperform: JMP Securities: $72
  • GRUB: initiated: buy: Sterne Agee: $56
  • SCTY: initiated: outperform: Avondale: $62

PRICE TARGET CHANGES:

  • NOW: pt cut from $97 to $90: Brean Capital
  • BLUE: pt raised from $117 to $150: JP Morgan
  • DIS: pt raised from $105 to $120: Jefferies
  • UA: pt raised from $85 to $93: Deutsche Bank
  • UA: pt raised from $85 to $91: Cowen
  • PM: it raised from $87-89 range to $94-96 range: Wells Fargo

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