Stocks closed mixed on Tuesday, following Monday's bloodbath. The S&P closed down .38% and for the fifth session in a row while the Nasdaq ended the day in the green in a choppy session. Asia markets closed mixed overnight while Europe indexes are higher this morning. U.S. futures are pointing to a bounce as I write this, the Dollar, Yields, and Oil are lower while Gold is higher.
And this is what UPB is reading this morning: https://www.optionmillionaires.com/morning-read/
And a nice read from UPB on the current market: https://www.optionmillionaires.com/a-different-script/
Stocks chopped around for most of the session on Tuesday, as names that have been pummeled over the past 5 days tried to find footing. I was looking for a small hedge ahead of the Fed statement and press conference today so went and added some DUST calls near the end of the day. DUST can benefit if Gold continues to falls and/or if markets remain in sell-mode. At the same time, any market squeeze or Gold bounce and the calls will likely expire worthless. I liked the risk/reward and may look for later dated strikes in the coming days:
BPT traded higher yesterday, testing $25 before finding sellers to close at $23.11. Will be looking to close my July $25 calls at some point and just hold my $30s. Once it holds $25 for a day or two will look to add some later dated strikes as well:
CME reversed almost all of the gains from Monday, closing down 3% at $196.11. Still like the name here. Will wait for a break back over $200 before looking to add some strikes into next week for that eventual move to $215 or so:
I was watching POOL yesterday and the stock was getting torched... the Baird analyst lays out the possible catalysts:
| Baird a buyer of Pool Corp. after incorrect report on FTC action |
| Baird analyst David Manthey blames underperformance in Pool Corp. shares today on both Jefferies' survey of new pool builders that expect demand to be flat or down in 2023 and Marketwatch having incorrectly reported regarding an FTC action against the company. Marketwatch incorrectly reported that Pool had reached a settlement with the FTC regarding "anti-competitive tactics," but subsequently corrected the report to state that the FTC order approving settling charges of anticompetitive tactics was from 10 years ago. Manthey believes concerns over both are "misplaced" and would be a buyer on what he calls the "unmerited weakness." He maintains an Outperform rating and $550 price target on Pool Corp. shares |
Still like it here and may add some calls if it finds green at the open:
Have to think some type of relief bounce comes soon... whether today, tomorrow, or Friday. Most are now expecting the Fed to raise rates .75% today. Would not be surprised to see a rally on the news and rates to actually drop. May look to add some spec calls on U, ROKU, and possibly SPOT:
U for a move back into the mid-high $30s:
ROKU for a move to $81+:
And SPOT for a move to $105+:
Will be an interesting day today, especially after 2pm. Get the popcorn ready.
Here are the analyst changes of note for today:
Disney showing good financial discipline with IPL renewal, says Evercore ISI |
| Evercore ISI analyst Vijay Jayant notes reports indicate that Viacom18, a joint venture between Reliance, Bodhi Tree, and Paramount (PARA), has outbid Disney (DIS) for the digital streaming rights to the Indian Primer League, or IPL, though Disney has retained the linear TV rights. Though Jayant estimates about 25% of Disney+ Hotstar subscribers could be at risk of churning from the loss of IPL, Disney keeping the lower-risk, and "substantially more valuable," linear rights for the coveted Indian Cricket league demonstrates good financial discipline, the analyst tells investors. Jayant keeps an Outperform rating and $150 price target on Disney shares |
| Coinbase price target lowered to $89 from $173 at Needham |
| Needham analyst John Todaro lowered the firm's price target on Coinbase to $89 from $173 but keeps a Buy rating on the shares. The analyst is updating his valuation model after the company restructuring announcement that reflects lower volumes, though he sees volumes bottoming in Q3 and then modestly rising in Q4. The staff cuts are also "a step in the right direction" given the crypto bear market and the broader concerns about the macro environment, Todaro tells investors in a research note |
| Citi says hard to give Abercrombie credit for its 2025 targets |
| If Abercrombie & Fitch hits its fiscal 2025 targets given at the investor day of $4.1B-$4.3B in sales and EBIT margin of 8%, the stock "looks very cheap at the current price," Citi analyst Paul Lejuez tells investors in a research note. However, there is "so little visibility" in fiscal 2022 and 2023, and with the potential for weaker trends if the consumer slows more broadly, it is hard to give any credit for the fiscal 2025 targets, says the analyst. He came away from the day "with some things we liked and some things we didn't," and keeps a Neutral rating on Abercrombie shares with a $21 price target |
| Monster Beverage price target raised to $95 from $90 at BMO Capital |
| BMO Capital analyst Andrew Strelzik raised the firm's price target on Monster Beverage to $95 from $90 but keeps a Market Perform rating on the shares. The company's business update following its shareholder meeting was positive, while the confirmation of Red Bull pricing coming in September tempers concern about Monster's market share outlook, the analyst tells investors in a research note. Strelzik adds however that the visibility to sales momentum required for an Outperform rating is limited |
And here is what I am watching today: POOL, SPOT, U, ROKU, BPT, CME, IBM, WYNN, ICE, LOVE, and HSKA.
Let's have a great day!
-JB