Stocks closed mixed on Friday, with the S&P and Nasdaq ending the day in the red, while the Dow closed up .23% after a strong July jobs report. Asia markets closed mostly higher overnight while Europe indexes are in the green this morning. U.S. futures are pointing to a higher open, the Dollar, Yields, and Oil are all lower while Gold is higher.
The July jobs report came in much hotter than expected on Friday. Pretty remarkable considering all the headlines recently from companies looking to layoff some of their workforce and/or scale back on hiring. All this does is give the Fed an excuse to raise rates again in September. The odds for another .75% hike went up to 68% after the data. This week we get July CPI on Wednesday. An inline number and maybe the rate hike estimates will ratchet down to .50%. If the data is higher than expected, markets will be under pressure. I think it will be the former and stocks can find some footing. It has been a pretty impressive second half of the year so far. Think $420 in the SPY can come this week:
This morning the rumored buyout of GBT by PFE was announced, with PFE buying GBT at $68.50 in an all cash transaction. Have to think other large cap Bio names with cash on hand will be looking at some names as well and M&A will pick up over the next month or so. Of course I love SAGE, may look at EDIT, and possibly ICPT for some calls along with some of the other gene editing names like BEAM and CRSP. These names will probably rally regardless of any buyout.:
BEAM (Bull-flag)
and ICPT:
There are still plenty of companies set to report earnings. Here are some of the implied moves:
Of the names, U is probably my favorite. They report tomorrow after the close. The stock is up nicely from its lows so will need a strong beat and raise for a move into the $60s:
WIX reports Wednesday morning. GDDY reported a strong Q last week so should bode well for WIX. May look to add some calls for a move over $85:
TRIP soared out of the gate on Friday on better than expected earnings. I went and added some more calls to go with my $26 strikes I added back in June. I was able to close the calls a few hours later for 200%+. I may look to close the $26 strikes, which are now back in the green, and just hold the rest of the $23.50s for a move into the mid-high $20s in the coming days:
Still love MITK and AMLX though AMLX found some sellers last week with no catalyst. Hopefully can find some buyers this week.
Here are the analyst changes of note for today:
Lumentum price target raised to $125 from $115 at Craig-Hallum |
| Craig-Hallum analyst Richard Shannon raised the firm's price target on Lumentum to $125 from $115 and keeps a Buy rating on the shares ahead of quarterly results. The analyst's view on Q4 is that it's likely to be good but not great, consistent with his checks and results in the optical space thus far |
| Post Holdings price target raised to $96 from $85 at BMO Capital |
| BMO Capital analyst Kenneth Zaslow raised the firm's price target on Post Holdings to $96 from $85 but keeps a Market Perform rating on the shares. The company's Q3 results exceeded expectations amid Post Consumer Brands strength, Foodservice recovery, and steady supply chain improvements, the analyst tells investors in a research note. Zaslow adds however that his neutral stance still reflects the ongoing uncertainty with foodservice, commodity volatility, and to a lesser extent, lingering supply chain constraints |
| McKesson price target raised to $409 from $378 at Deutsche Bank |
| Deutsche Bank analyst George Hill raised the firm's price target on McKesson to $409 from $378 and keeps a Buy rating on the shares. The company reported strong fiscal Q1 results, with an "impressive beat powered" both by performance in its core business as well as a continued contribution from COVID therapies and supplies, Hill tells investors in a research note |
| Shake Shack price target lowered to $53 from $68 at Deutsche Bank |
| Deutsche Bank analyst Brian Mullan lowered the firm's price target on Shake Shack to $53 from $68 and keeps a Hold rating on the shares post the Q2 results |
| Enphase Energy price target raised to $321 from $261 at JPMorgan |
| JPMorgan analyst Mark Strouse raised the firm's price target on Enphase Energy to $321 from $261 and keeps an Overweight rating on the shares. The analyst views the Inflation Reduction Act as the largest policy change in U.S. history to accelerate growth in an "already inevitable energy transition to renewables." While changes are still possible as the bill proceeds to the House of Representatives, investor expectations for the industry will "appreciate materially with the passage of the more evenly divided Senate," Strouse tells investors in a research note. Although alternative energy stocks have risen since the initial news of the bill, there is further upside for most companies in the space, says the analyst. He thinks companies with existing domestic manufacturing as the most immediate beneficiaries |
| Acadia Pharmaceuticals price target lowered to $21 from $32 at Cowen |
| Cowen analyst Ritu Baral lowered the firm's price target on Acadia Pharmaceuticals to $21 from $32 and keeps an Outperform rating on the shares. The analyst said as expected they received a CRL for their sNDA for pima in ADP after the negative June AdComm vote. In the letter FDA reiterated concerns on the adequacy and clinical meaningfulness of the datasets at hand and recommended an additional ADP study however, no safety concerns were raised |
And here is what I am watching today: WIX, U, RBLX, BEAM, SAGE, CRSP, EDIT, ICPT, SPOT, PTON, CI, and PYPL.
Let's have a great day!
-JB