Markets closed lower for the third session in a row on Tuesday, with the S&P finishing the day down .22%. Asia stocks closed lower overnight while Europe indexes are off their lows and mixed as I write this. U.S. futures are in the green, the Dollar and Oil are higher while Yields and Gold are lower.
And this is what UPB is reading this morning: https://www.optionmillionaires.com/morning-reads-86/
It was a choppy, boring session on Tuesday with stocks trading in the red most of the day and failing to find any sustained rallies after a morning gap. If there was a positive from yesterday, it was that there was no continuation from Friday and Monday's sell-offs. We still have PCE data and Jackson Hole on Friday so would want to see the markets at least try and hold their ground into Friday. That $410 area on the SPY is worrisome, and there is a bearish crossover on the momentum indicators(a chart shared in the chart channel):
So would want to see some type of reversal here soon and that $410 handle hold tor could be looking at a move to $400 in the next week or so. Don't think that is a high probability but open to it and will be cautious on the call side for now:
I added some APRN calls yesterday. The company trades like its going bankrupt - which is understandable since there is a 'going concern' warning on their last filing - but if you dig deeper it shows a growing company that is in the late stages of a turnaround. It trades at a valuation of less than half revenues and sports an insane 43% short interest. I added some Sept calls and may look for some later dated strikes as I think the stock will trade at least 3-4x's revenues which puts the stock around $18-20 in the coming months:
ULTA received a PT upgrade this morning. Hopefully the kick it needs to break over $410 and for my calls to start gaining some premium ahead of their earnings tomorrow after the close:
Still watching SCVL for a potential entry into earnings tomorrow morning. The problem is there are only monthly strikes in $5 increments. Spreads are also wide and look somewhat pricey. The only ones that look decent on a risk/reward basis are the $35 strikes but that implies a 40% move so may just wait until after the open tomorrow:
PTON announced a product launch on AMZN this morning and the stock is gapping higher. Have to think this will only add to speculation that AMZN will eventually acquire them. PTON reports earnings tomorrow morning and premiums will remain sky high. Will likely pass on adding anything for now:
Its was a strong session for ICPT, reversing morning lows to close slightly higher. A slow grind higher is no fun for shorts. Another solid session today and think the $20s are back soon:
SAGE still looks great here. It used a late day surge to close higher. A move thru $42.76 today and I will add some strikes:
Still eyeing YOU, PANW, and SPOT for entries as well today.
Here are the analyst changes of note for today:
|AbbVie price target lowered to $155 from $165 at Argus|
|Argus analyst Jasper Hellweg lowered the firm's price target on AbbVie to $155 from $165 but keeps a Buy rating on the shares. The analyst remains positive on the company's ability to generate substantial cash flow that supports its dividend. Hellweg further contends that AbbVie's valuation of 10.8-times his expected forward earnings is "favorable" relative to 19.1-times average in his coverage universe of large-cap biotech and pharmaceutical stocks|
|Macy's price target lowered to $30 from $35 at Evercore ISI|
|Evercore ISI analyst Omar Saad lowered the firm's price target on Macy's to $30 from $35 and keeps an Outperform rating on the shares. While Macy's experienced a sharp 5-point sales deceleration across income demographics beginning in June, management lowered full-year EPS guidance by just 14%, which is noteworthy at a time when other high-profile retailers have cut guidance by 50% or more, Saad tells investors in a research note|
|Dick's Sporting price target raised to $160 from $120 at Evercore ISI|
|Evercore ISI analyst Warren Cheng raised the firm's price target on Dick's Sporting to $160 from $120 and keeps an Outperform rating on the shares. Cheng thinks Q2 showed some key pieces of evidence that normalized EPS for Dick's Sporting will likely settle out somewhere north of $11-$12, the analyst tells investors in a research note|
|Dick's Sporting price target raised to $130 from $120 at DA Davidson|
|DA Davidson analyst Michael Baker raised the firm's price target on Dick's Sporting to $130 from $120 and keeps a Buy rating on the shares. The company's customers are proving to be "resilient", the analyst tells investors in a research note, adding that its ideas during the past few years have also resulted in "structurally better margins" and a "permanent" increase in profitability. Baker further states that while inventory increase in Q2 was high, he sees "plenty of cushion" for Dick's to continue to aggressively clear out the excess apparel inventory|
|Intuit price target raised to $516 from $476 at Oppenheimer|
|Oppenheimer analyst Scott Schneeberger raised the firm's price target on Intuit to $516 from $476 and keeps an Outperform rating on the shares following quarterly results. The analyst anticipates organic growth in coming years to rival that of recent years via further TurboTax penetration into professional tax preparation/revenue synergies from the Credit Karma/Mailchimp acquisitions|
|Dick's Sporting price target raised to $142 from $128 at Cowen|
|Cowen analyst John Kernan raised the firm's price target on Dick's Sporting to $142 from $128 and keeps an Outperform rating on the shares. The analyst said the debate around durability of omni-channel productivity and merchandise margin will continue, and he thinks management laid out an even more confident case regarding the operational improvements that lead to maintaining gains. Kernan modeled positive comps in Q4 and inventory position normalizing by Q1 2023|
And here is what I am watching today: ULTA, YOU, SAGE, PTON, PANW, ICPT, ROKU, SPOT, and TWLO.
Let's have a great day!