Markets closed higher on Wednesday, with the S&P adding .75%, recouping Tuesday's losses and then some. Asia markets closed in the green overnight while Europe indexes are flat this morning. U.S. futures are pointing to a lower open as I write this, the Dollar, Yields, and Oil are higher while Gold is lower.
And this is what UPB is reading this morning: https://www.optionmillionaires.com/morning-reads-172/
Markets rallied on Wednesday, and held most of the gains, in spite of the Fed minutes painting a hawkish and uncertain picture.The last 5 sessions of the year and first 2 sessions of the New Year are typically categorized as the 'Santa Clause Rally' timeframe. The S&P rose .80% over that period, so there was a rally, just below the historical average of 1.2%. The SPY came up to $386 before finding pressure again just like on Tuesday. Certainly looks like the area of resistance for now. The ADP numbers came out this morning much better than expected. If markets continue to find pressure on the strong data, would want to see that $380 hold:
NFLX resumed its uptrend yesterday, closing up nearly 5% and for the 4th session in a row. I was able to close most of my calls out for 100% and 250% and held the rest into today for a possible retest of the $320s. NFLX will certainly be tested today with this morning's weakness. If it fails to hold $300, will look to close the last of my calls out and revisit:
TNDM also closed up nearly 5% yesterday. I was able to close some of my Jan calls for 100%. The stock sure looks like it wants to gap fill that $50 handle. Will look to close some of my Feb strikes soon to cover costs and ride the rest:
SQ closed green yesterday but well off its highs. Will use the $64 handle as a stop for the rest of my calls:
I added some speculative ISRG weekly calls yesterday as outlined on the watchlist. The stock received another upgrade and looks poised to breakout of its recent consolidation. This morning's market gap lower certainly not going to help matters. If it falls into the low $260s I may actually look to add some strikes into next week:
I added some TZOO calls on a filing that the CEO/Chairman added shares equivalent to about 25% of the entire outstanding share count and now owns over 63% of the O/S. It was part of deal for the company to add some liquidity as it looks to scale its growth. Think this breaks into the $6-7 area in the coming days:
VKTX tried, but failed to reclaim the $9 handle yesterday. Can make the case that a possible bull-flag is setting up. Still eyeing some later dated strikes to add to my January calls:
BLK still has extremely tight Bollinger bands, which typically precedes an outsized move. Back on watch for some possible calls. They report earnings a week from tomorrow:
Still eyeing AXSM and MASI, and adding CME and ICE to the watchlist as well.
Here are the analyst changes of note for today:
BofA starts Amylyx with a Buy given 'huge unmet need' in ALS |
| As previously reported, BofA analyst Geoff Meacham initiated coverage of Amylyx with a Buy rating and $50 price target. The company's AMX0035, or Relyvrio, is the first drug approved for ALS to show a functional and survival benefit on top of standard of care and he sees it being used despite its approval and pricing controversy, Meacham tells investors. Amylyx could withdraw Relyvrio from the market if the confirmatory trial in 2024 fails to show benefit, but he thinks that is less likely and he anticipates "strong uptake" in the U.S., Meacham added |
| Ulta Beauty price target raised to $530 from $455 at Argus |
| Argus analyst Kristina Ruggeri raised the firm's price target on Ulta Beauty to $530 from $455 and keeps a Buy rating on the shares. The analyst is positive on the company's business partnerships, loyalty programs, strong customer engagement, and new focus on wellness. Ruggeri also cites Ulta's most recent operating margin of 15.5% coming in at a record high. The analyst is raising her FY23 EPS view on the stock to $22.75 from $21.00 and her FY24 view to $23.82 from $22.55 |
| McDonald's price target raised to $263 from $262 at Deutsche Bank |
| Deutsche Bank analyst Brian Mullan raised the firm's price target on McDonald's to $263 from $262 and keeps a Hold rating on the shares ahead of the Q4 results. The analyst's sense is that current investor expectations call for a Q4 U.S. same-store-sales result that is comfortably above the current consensus estimate of 8.0% growth |
| Salesforce price target lowered to $175 from $195 at Cowen |
| Cowen analyst J. Derrick Wood lowered the firm's price target on Salesforce to $175 from $195 and keeps an Outperform rating on the shares. The analyst noted the restructuring announcement and thinks this reinforces investor concerns of weakening demand and so he lowered his growth outlook for next year. At the same time, this is a sign that management is making margin expansion a top priority |
Atlassian upgraded to Buy from Hold at Jefferies |
| Jefferies analyst Brent Thill upgraded Atlassian to Buy from Hold with an unchanged price target of $150. The analyst sees a "mixed to negative outlook" in the first half of 2023 for software with weakening fundamentals and continued multiple pressure. However, good news is likely to come in the second half of the year with reset multiples and a reacceleration of growth at some point in 2024, Thill tells investors in a research note. He upgraded the shares as part of his 2023 software playbook |
| adrigal Pharmaceuticals price target raised to $390 from $312 at JMP Securities |
| JMP Securities analyst Jonathan Wolleben raised the firm's price target on Madrigal Pharmaceuticals to $390 from $312 and keeps an Outperform rating on the shares. The analyst is citing his survey of about 25 NASH specialists with a total of about 2,700 patients who indicate that they will recommend resmetirom to 45% of their F2/F3 patients. Wolleben adds that his anticipated usage rate for the drug is substantially higher than the current Street expectations as his survey results "clearly show" a strong intent to use resmetirom by doctors on the forefront of NASH management |
| American Express cut to Underweight at Stephens on growth and capital concerns |
| As previously reported, Stephens analyst Vincent Caintic downgraded American Express to Underweight from Equal Weight with a price target of $134, down from $146. American Express has been the investor safe haven of choice among credit cards, but given that Amex experienced the fastest loan growth among cards through the pandemic, has large commercial exposures and increased millennial concentrations, he thinks Amex is "more sensitive to a downturn than peers," Caintic tells investors. The combination of having the lowest credit reserves and second lowest capital ratio makes him worried about Amex's cushion heading into a recession, added the analyst, who notes that his 2023 EPS forecast is now 4% below consensus |
Oracle upgraded to Buy from Hold at Jefferies |
| Jefferies analyst Brent Thill upgraded Oracle to Buy from Hold with a price target of $105, up from $90. The analyst sees a "mixed to negative outlook" in the first half of 2023 for software with weakening fundamentals and continued multiple pressure. However, good news is likely to come in the second half of the year with reset multiples and a reacceleration of growth at some point in 2024, Thill tells investors. Oracle "got their mojo back," said the analyst, who likes the reacceleration growth theme and identifies it as a "tactical pick for value investors |
And here is what I am watching today: AXSM, MASI, CME, ICE, BLK, SPOT, SQ, GNRC, VKTX, UDMY, RARE, SAGE, ALGN, IBM, CMG, ROKU, and NFLX.
Let's have a great day!
-JB