Good morning! Stock futures are lower to start todays trading session after another record day on Wednesday.
UPB HERE this morning...
$AMZN is over that widely publicized $2,000 level this morning, despite the weaker start for the over all market.
The action since yesterdays late afternoon highs looks like more consolidation.
The action still does not feel overdone on the upside. And despite all the record highs, the most widely used litmus test for the market by the media, the Dow Jones Industrial Average, has still not hit a new record high since January. The blue chips have some catching up to do... another 600 points of upside should do the trick.
Some of last night and this mornings earnings:
- Salesforce (CRM 149.60, -5.20): -3.4% after below-consensus guidance for Q3 overshadowed above-consensus Q2 results.
- Dollar General (DG 104.10, -2.56): -2.5% despite beating both top and bottom line estimates.
- Dollar Tree (DLTR 89.25, -5.21): -5.5% after reporting worse-than-expected earnings.
- Campbell Soup (CPB 38.50, -1.49): -3.7% after missing revenue estimates and issuing below-consensus guidance for FY19.
- Burlington Stores (BURL 157.02, -9.42): -5.7% after below-consensus Q3 guidance overshadowed above-consensus Q2 results.
Movers:
- MNOV +8.5% (modestly higher after noting its SPRINT-MS Phase 2b trial of MN-166 (ibudilast) in progressive multiple sclerosis results were published in NEJM)
- INSY +7.4% (granted Fast Track designation by the FDA for epinephrine nasal spray as an investigational treatment for anaphylaxis)
- TRNC +3.5% (following Nieman Lab report that Donerail Group has secured financing for a takeover bid)
- VGR +2.9% (indicated higher after declaring unchanged $0.40/share quarterly dividend and granting stockholders additional 5% annual stock dividend-also unchanged from prior year)
- VSTM +1.5% (appoints Robert Gagnon CFO, effective August 28)
- TOCA +9.7% (initiated with a Buy at Chardan Capital Markets)
- ARLO +3.7% (upgraded to Buy from Neutral at Guggenheim)
- GCO +1.7% (upgraded to Buy at Pivotal Research Group)
- TNDM +1.6% (initiated with a Buy at Berenberg)
- NTNX +1.4% (upgraded to Neutral from Underweight at JP Morgan)
- DVA -4.9% (California Assembly passes dialysis legislation bill)
- CRON -4.2% (pulling back following yesterday's 15% move higher)
- TLRY -3.4% (pulling back following yesterday's 20% move higher)
- LC -2.2% (COO Sameer Gulati resigned effective on December 31)
I still think that $SPY $300 is coming, $QQQ $200 and $IWM ~$190.
As far as this bull market is concerned, I believe the reason to sell will come at some point, and when it does there will be plenty of opportunity to trade for downside. It's not going to come in one 30% down day for the market.
As such, having a bullish bias with a market hitting record highs is not such a terrible thing.
Here are some analyst comments this morning.
FWIW with $CRM every analyst this morning has been positive on the stock despite its downside. Could be a decent buy the dip candidate this morning.
$CRM
| Salesforce price target raised to $180 from $147 at KeyBanc | |
| KeyBanc analyst Brent Bracelin raised his price target for Salesforce to $180 form $147 after another "solid" quarter that was punctuated by a $51M revenue beat on increasing momentum within Commerce and Integration Cloud segments from broadening customer adoption of newly acquired MuleSoft and Demandware products. The analyst reiterates an Overweight rating on the shares | |
$TWTR
| Twitter DAUs as 'monetizable' as Facebook's, says MKM Partners | |
| MKM Partners analyst Rob Sanderson keeps his Buy rating and $43 price target on Twitter (TWTR), saying the latest quarter was a "healthy reset" as the company still offers a "great and differentiated content story". The analyst also believes that Twitter's Daily Active User count is "at least" as monetizable as that of Facebook (FB) and possibly more so over time, even though the company is currently spending its capital on network health. Sanderson adds that he still believes in the "potential for a mass-market Twitter one day", with the continued development of AI technology serving as a possible user experience break-through opportunity. :theflyo | |
$TLYS
| Tilly's price target raised to $22 from $17 at Roth Capital | |
| Roth Capital analyst Dave King raised his price target for Tilly's to $22 from $17 after Q2 results beat estimates on strong comps and lower than expected expenses, while guidance exceeded expectations on strong Back to School performance. The analyst reiterates a Buy rating on the shares, which reflects Tilly's attractive relative valuation, high concentration of proprietary private label products, limited fashion risk, small relative store footprint, continued tailwinds from recent merchandising improvement initiatives, and the potential for rent relief and further capital return
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$WDAY
| Workday price target raised to $173 from $145 at KeyBanc | |
| KeyBanc analyst Brent Bracelin raised his price target for Workday to $173 from $145 as his analysis of "Key First Look Data: Jobs" has exposed high-profile cloud HCM wins this quarter at a financial services firm with 77K employees, two medical technology firms with 40K-plus employees, and an insurance services firm with 38K employees. The analyst also uncovered several high-profile cloud ERP wins at large universities. While concerns surfaced last quarter after billings decelerated to 8%, his proprietary jobs analysis gives him confidence that calculated billings growth could reaccelerate back above 30% year over year this quarter. Bracelin reiterates an Overweight rating on the shares. | |
$FDC
| First Data price target raised to $30 from $28 at Goldman Sachs | |||
| Goldman Sachs analyst James Schneider raised his price target on First Data to $30 and kept his Buy rating, saying the company's fundamentals are inflecting as revenue acceleration "paves the way" for multiple expansion - all in spite of the 23% run-up in its stock price since mid-June. The analyst notes that his channel checks suggest a further revenue growth opportunity over the next few quarters, adding that First Data's "significant valuation gap" relative to other payment peers also offer a "strong" risk/reward profile at current price | |||
$EXAS
| Exact Sciences price target raised to $75 from $45 at Goldman Sachs | |
| Goldman Sachs analyst Patrick Donnelly raised his price target on Exact Sciences (EXAS) to $75, citing the positive impact of its co-promotion agreement with Pfizer (PFE) on Cologuard announced last week. The analyst expects the transaction to be "fundamentally transformative" for Exact Sciences over the next 3-4 years in terms of its revenue growth potential, but sees the 50% upside reaction in the stock price as sufficient in capturing the upside. Donnelly keeps his Neutral rating on Exact Sciences | |
$STZ
| Morgan Stanley keeps Overweight on Constellation after 'solid' Canopy meeting | |
| After attending Canopy Growth's (CGC) analyst day, Morgan Stanley analyst Dara Mohsenian said he was impressed by CEO Bruce Linton and the Canopy organization. He also noted that Constellation Brands' (STZ) CFO David Klein clearly remains confident in its beer prospects and indirectly refuted the bear case that its investment in Canopy signals slowing base business growth. Mohsenian, who thinks the risk around the Canopy stake has been more than priced into Constellation shares given their pullback since the deal, also believes the market is not pricing in enough long-term beer revenue growth. He reiterated his Overweight rating and $258 price target on Constellation shares following the investor meetings | |
Opinion:
I think the market is in the midst of the next breakout phase. Sounds crazy here at record highs, but this type of action is similar to what we have seen previously. I think the $SPY is gearing towards a move to $300. Obviously there will be more dips, Turkey's, North Koreas and soon to be revealed reasons to sell.
and when the market does finally roll over, I think there will be plenty of time to trade for the downside, while having that bearish bias.
I remain in calls this week with leaps in a host of names:
$VSI $GME $MOS $SWCH $TXMD and weekly $FSLR calls.
$TXMD is one of my favorite stocks right now. I was trying to dig up historical short interest, but I know at least 15 million of the over 60 million share short positions were opened up with prices from $4.50 to $5.50. $TXMD is currently at $6.30 meaning those shorts are underwater and drowning.
$TXMD was shorted based upon numerous bearish blogs posts and articles while the company was still in its early stages. This year $TXMD stands to get 3 FDA approvlas! With the 3rd one coming in late October and promises to be their best potential revenue producer. Their Imvexxy launch has come in much better than expected! And they are launching the lower dose version in weeks. They also have a big health conference next week.
$MOS is starting to take off. A break of the earnings high sends it. The analyst headlines for $MOS yesterday were "higher prices" and that bodes well. I also see the pot getting thrown in the mix. Either way this is a stock that could start to get really hot into the fall. I very well may look for some calls into next year on this one.
This morning I may look for some weekly $CRM calls on the earnings dip.
$OSTK was a name I was watching yesterday and it gave me the answer for now... stay away.
$TWTR looks like a nice base off the earning collapse has formed and I think a move back to $40 could be in the cards over the short term. I may look for some calls into next week.
Remember when looking to next week - market is only open 4 days with the Labor day holiday on Monday.
With that have a great trading day!
UPB