Markets gave back some of the weeks gains yesterday, with the S&P dropping .72% while the Nasdaq closed 1.71% lower. Asia markets closed in the red overnight while Europe indexes are also lower as I write this. U.S. futures are pointing to a bounce, the Dollar and Yields are lower while Oil and Gold are higher.
And this is what UPB is reading this morning: https://www.optionmillionaires.com/friday-morning-reads-214/
Much anticipated inflation data came out this morning and it was pretty much inline with expectations, though inflation came in at a near 40 year high. Future are soaring as I type this... some it as a relief it was not worse and likely some it the expectation the Fed will not raise rates any sooner. Yields also fell after the report but are starting to pare gains. Will be interesting to see if the near 1% gap in the Nasdaq can hold today. Will be watching TLT as a guide. If TLT starts to decline could be a reversal.:
The momentum names found pressure again yesterday, despite the concerns over the Omicron variant waning. No shock that Yields started to rise and it seems they are more sensitive to that right now then anything else, which is why I will be watching it like a hawk.
Names like TEAM, U, OKTA, TWLO, SPOT, and even ROKU found pressure yesterday. Hoping the gap holds today, Yields drop, and I can become more convicted into adding some calls and longer-dated strikes. For now, not throwing money at a position just to make a trade has been the gameplan.
LOVE ran to test $85 yesterday. The premiums were relatively high so I passed on adding ay strikes. As mentioned on yesterdays watchlist, will look to enter on any consolidation back near $75:
Not going to beat a dead horse here and regurgitate my commentary from the last few days. Still have the same plan for DKNG, SPOT, TWLO, TWLO, SPOT, SAM , IQV - can read here: https://www.optionmillionaires.com/december-9th-2021-watch-list/
Was watching RNG for some puts after the COO/President news after the close Wednesday. Sure enough the stock plummeted all the way to $180 before bouncing. Not going to chase puts at the open but may nibble some speculative puts today, especially if it goes green to red. That $180 handle as been support and figure a move to $175 and below will come quick once that breaks:
EVBG announced the sudden departure of their CEO after the close yesterday. He will also leave the board of directors. They don't give a reason so would have to think there was something going on. The departure of the CEO is enough to rock the stock but the uncertainty of the departure just adds more salt to the wounds, especially for a company that is accustomed to 30%+ growth. Not going to try and catch a falling knife but down here at $68 or so could be a playable bounce:
If Yields start to rise(TLT goes lower) may look at some potential speculative put trades in the momo/growth names.
On a side note, starting work on the Top 5 Stocks for 2022 Webinar. Don't be surprised if you see me add some calls on a name you have never seen me mention before in the combing days - will not it as a top 5 stock for 2022 when I do.
Here are the analyst changes of note for today:
| CF Industries price target raised to $75 from $70 at BMO Capital | |
| BMO Capital analyst Joel Jackson raised the firm's price target on CF Industries to $75 from $70 and keeps an Outperform rating on the shares. The analyst cites the company's disclosure that its Q4 is tracking better thanks to the strong global nitrogen market conditions. Jackson adds that even assuming a moderation from record prices, CF still seems to be pace for free cash flow well in excess of $10 per share, which should accelerate buybacks and provide more dry powder for investments | |
| Oracle price target raised to $115 from $100 at BMO Capital | |
| BMO Capital analyst Keith Bachman raised the firm's price target on Oracle to $115 from $100 but keeps a Market Perform rating on the shares. The analyst notes that the company's total revenue growth was the highest in the last six years, but most of the upside in the quarter came from license revenues, with database business also serving as a "meaningful contributor". Bachman adds that Q2 marked a "solid quarter all around", but he is "not yet convinced" such strength is durable | |
| Broadcom price target raised to $723 from $572 at Morgan Stanley | |
| Morgan Stanley analyst Joseph Moore raised the firm's price target on Broadcom to $723 from $572 and keeps an Overweight rating on the shares, stating that despite Broadcom reporting "generally in-line numbers" for the quarter, there is "a lot to like in the print." The positives include the company continuing to "expand its leading operating margin to impressive levels" and its "solid raise" to next quarter's revenue outlook, said Moore, who adds that management committed to a dividend raise of approximately 14% and announced a new, $10B share repurchase plan in the absence of large M&A | |
| Lululemon price target raised to $485 from $468 at MKM Partners | |
| MKM Partners analyst Roxanne Meyer raised the firm's price target on Lululemon to $485 from $468 and keeps a Buy rating on the shares. The company's Q3 sales and margins were "significantly better" than expected despite the potential disruption from supply chain, with raised Q4 sales guidance also highlighting the "strong execution" of its sourcing and the competitive advantage of its assortment, the analyst tells investors in a research note. Meyer recommends that investors buy Lululemon shares "on any weakness" given its "impressive" growth and execution | |
| Square commentary points to modest Q4 downside in Cash App, says Jefferies | |
| Jefferies analyst Trevor Williams is lowering his Q4 Cash App estimates for Square following recent intra-quarter commentary from management that points to modest Q4 downside in Cash App on a slowing growth rate. His revised FY22 Cash App estimate of $2.46B is 9% below the Street, with the entirety of his estimate cut being due to lower monthly active users, added Williams, who admits that his "call that the miss/cut post-3Q would be a clearing event was wrong." While saying he missed the likelihood of cuts to 2022 estimates on the "aggressive MAU ramp" built into Street consensus numbers, he believes "this round of cuts should serve as the all-clear we'd hoped for initially" and expects renewed investor enthusiasm to own Square shares for what he calls "a catalyst-rich" 2022. Williams keeps a Buy rating and $240 price target on the stock | |
And here is what I am watching today: EVBG, RNG, WLO, SPOT, SAM , IQV, LOVE, FUBO, TEAM, ZS, V, MA, OKTA, and MDB.
Let's have a great day!
-JB