Stocks tried to muster a rally on Wednesday, but came under pressure after the Fed Meeting and the Powell presser, with the S&P closing down .15%. Asia market tumbled overnight while Europe stocks are flat this morning. U.S. futures are pointing to a higher open, the Dollar and Oil are green while Gold and Yields are lower.
And this is what UPB is reading this morning: https://www.optionmillionaires.com/thursday-morning-reads-231/
It was another one of those sessions yesterday, with names I was looking to get calls on for bounces giving up their entire morning gap and closing lower. AAPS, SPOT, CMG, KRNT... to name a few. In the late afternoon I was contemplating adding some of the 3X bear ETFs.. DRV, LABD, FAZ, and SRS. This weeks chop has been ruthless, unless you are looking to take some quick scalps - option premiums get killed on the swings. Worse yet, the premiums are so high, that when they do move in the direction of the calls, the premiums stay flat or even erode. Hoping weekly options will see some premium erosion today so I can look to play some speculative positions.
The Fed walked a tight tope yesterday, reiterating the stance of rate hikes coming as soon as March, while also trying to quell market concerns. Would hope stocks can find a bid today and tomorrow or I fear a bear flag is playing out on the S&P, and a move under $400 comes:
I used to talk about price discovery a lot. Monday and Tuesday of this week shows there is a wide divergence in what some folks thing stocks should be worth. Some stability today and tomorrow and maybe the signal bottom is near or in, at least for the short-term.
LVS reported earnings after the close yesterday that were mixed. It seemed almost like a relief quarter, not as bad as some feared with Macau issues and the Omicron variant leading to restrictions. WYNN could see a nice move off the lows here. I still think Macau is not priced in much at all in the valuation and think WYNN should be $110+ at minimum. Will be looking at some later dated calls today:
MCD reported earnings this morning that slightly missed estimates on higher expenses. Not sure it will weigh on CMG much - still think CMG offers a decent risk/reward here. Will be eyeing some calls again today(hoping premiums come down):
There seems to be one big cap Bio that has held up well despite the carnage these past few months... VRTX. They reported a strong Q yesterday and it looks poised for a move over $250. May look at some spec calls this morning:
Again, not going to get too aggressive just yet. It is very easy to blow an account being aggressive in this type of market. Small can become big quickly but big can become small just as fast... which is why I try to keep it small for now...
Here are the analyst changes of note for today:
| Lam Research price target lowered to $725 from $750 at B. Riley | |
| B. Riley analyst Craig Ellis lowered the firm's price target on Lam Research to $725 from $750 and keeps a Buy rating on the shares. While Lam's Q2 print and Q3 guidance were mixed and below consensus, Ellis thinks Lam has good root cause and resolution optics with expedited action underway, the analyst tells investors in a research not | |
| Microsoft's strong Q2 earnings beat was 'welcome news', says Argus | |
| Argus analyst Joseph Bonner keeps his Buy rating and $371 price target on Microsoft after its Q2 earnings beat and guidance. Technology shares have been beaten down by a variety of concerns, but the company's strong results and outlook suggest that underlying software demand remains robust, the analyst tells investors in a research note. Bonner is also raising his FY22 EPS estimate to $9.76 from $9.70 and his FY23 forecast to $10.56 from $10.47 | |
| Clean Energy price target raised to $27 from $20 at Craig-Hallum | |
| Craig-Hallum analyst Eric Stine raised the firm's price target on Clean Energy to $27 from $20 and keeps a Buy rating on the shares after the company held its first ever investor day focused on Renewable Natural Gas, the market opportunity, its overall plans, and the anticipated financial impact as its upstream and downstream plans take hold. The analyst views RNG as a critical solution for the decarbonization of transportation and the obvious choice for fleets to lower emissions and lessen carbon footprints. He believes Clean Energy is an "ideal investment" to capitalize on this multi-decade growth theme, "a view which was not only supported by the investor event but gave it an exclamation point," Stine contends | |
| TransUnion downgraded to Hold from Buy at Truist | |
| Truist analyst Andrew Jeffrey downgraded TransUnion (TRU) to Hold from Buy with a price target of $105, down from $135. The analyst says he had viewed the company as "more innovative" than Equifax (EFX) and he also liked TransUnion's lower mortgage revenue exposure, but now he sees it lagging Equifax's innovation in key areas. Jeffrey further notes that he is less bullish on consumer credit and FinTech acceleration while questioning TransUnion's Neustar deal. The analyst also lowers his FY22 EPS view by 10c to $4.10 | |
| Vertex Pharmaceuticals 'best large cap biotech in this market,' says Jefferies | |
| Jefferies analyst Michael Yee said after Vertex Pharmaceuticals reported Q4 results and gave 2022 guidance that was $500M above consensus that he continues to like the stock as a "Franchise Pick" and top large cap idea, calling it the "best large cap biotech name in this market." Vertex has gone from having a pipeline problem perception in 2020 to now having many pipeline programs looking good, especially all in the last 3-4 months, Yee tells investors. He thinks a competitor overhang in cystic fibrosis should pass and believes "a bunch of positive readouts all in late 2021" give Vertex visibility into future growth over the next three to five-plus years, which leads Yee to conclude the stock should recover and go back up to his $275 price target this year as its multiple near-term catalysts play out. Yee keeps a Buy rating on Vertex shares | |
And here is what I am watching today: VRTX, CMG, KRNT, WYNN, FAZ, SRS, TZA, LABD, DRV, ZBRA, PANW, NOW, TWLO, SPOT, APPS, and LRCX.
Let's have a Great Day!
-JB