Futures are pointing to a red to start this last day of May, with the S&P set to open .49% lower as I write this. Asia stocks closed mixed overnight while Europe indexes are in the red this morning. The US dollar, Yields, and Oil are higher while Gold is lower.
Stocks rallied last week, with the S&P adding over 8.5%, putting an end to a 7 week losing streak. Some of the rally can be attributed to hopes inflation has peaked. The Fed's preferred inflation gauge, the PCE, came in at 6.3% on Friday - it was the first decline in 1 1/12 years. Will be a few weeks before ee get May inflation data, but could be a sign some of the worst case inflationary worries are coming to an end. Not going to say we are out of the woods yet. All these negative headlines have had to have an impact on consumers and spending. Almost feels like we need to have a recession to pull off the band-aid and bottom. I talked about $420 on last weeks watchlist for there SPY. That area could pose some resistance. I would prefer some chop for the next few days before that test. On the flip side, $410 could provide some support although it offered zero resistance on Friday:
BPT closed flat on Friday. It is gapping up a bit in the pre-market. It seems there are sellers at the $20 handle. Once it breaks that resistance think $25+ comes in the coming weeks. Will look to close my June $20s at 100% and hold the July's:
ZYME had another great session on Friday, closing up nearly 8%. My July calls are nearly a double and will look to take off some to cover costs over 100% and ride the rest. I think it can head over $10 even without a buyout offer:
IBM had another solid session on Friday, closing up nearly 2% and for the 5th session in a row. Would really like to see it break into the $140s before any consolidation. I will look to close some of my July calls at 100% and hold the rest when I get the chance:
Still eyeing HSKA for calls and a move to $110+ in the coming week or two:
EXPE is also still on watch, the chart is pinching and looks like a move to $150 or so is in the cards:
There are still earnings this week, here are the implied moves: https://www.optionmillionaires.com/some-implied-move-for-earnings-next-weekmay-31st-june-3rd/
APPS is one of the names reporting and looks like a decent risk/reward setup. June $35s or even $31 weeklies look interesting. May nibble a few speculative calls today or tomorrow:
Here are the analyst changes of note for today:
| Abbott's Libre 3 approval came slightly ahead of expectations, says BofA |
| After the FDA posted on Monday its approval for Abbott's (ABT) FreeStyle Libre 3 Continuous Glucose Monitoring, or CGM, system and the company affirmed the news, BofA analyst Travis Steed said the approval came slightly ahead of expectations and the label came in "as expected." Libre 3 is not yet able to operate an automated pump like Control-IQ given the warning that taking vitamin C supplements could falsely raise sensor glucose readings, but a new smaller trial is already underway to remove this warning and Abbott is hopeful to have this contraindication resolved around the end of this year, said Steed, who adds that he views the approval as a good sign the FDA is back to focusing on diabetes approvals and thinks DexCom's (DXCM) G7 approval is "likely in the very near term." Steed maintains a Buy rating and $140 price target on Abbott shares |
| Okta price target lowered to $145 from $260 at RBC Capital |
| RBC Capital analyst Matthew Hedberg lowered the firm's price target on Okta to $145 from $260 to reflect peer multiple compression but keeps an Outperform rating on the shares ahead of its Q1 results. Hedberg expects Okta management to to renew the focus on the company's strategic outlook and begin to move past the overhang from their security incident earlier in the quarter, adding that he continues to see the platform as "well positioned for security transformations" |
| Tesla shutdown in Shanghai a near-term headwind, says Mizuho |
| Mizuho analyst Vijay Rakesh reiterates a Buy rating on Tesla with a $1,300 price target after hosting a field trip in Fremont. The analyst believes Gigafactory Shanghai still remains in partial utilization and might be a near-term production headwind, though he says the back two quarters of 2022 could see a strong production rebound. Tesla has potentially 1.4M of its 1.5M 2022 target units that could be produced at just Fremont and primarily Shanghai as the major hub, Rakesh tells investors in a research note. But with Shanghai residents still mostly in lockdown, a Giga-Shanghai reopening will likely be slower than expected, says the analyst |
| Medtronic price target lowered to $109 from $116 at Raymond James |
| Raymond James analyst Jayson Bedford lowered the firm's price target on Medtronic to $109 from $116 and keeps an Outperform rating on the shares. Bedford calls Medtronic's Q4 results and near-term guidance "uninspiring," and tells investors in a research note that the company's supply chain issues are having a disproportionate impact on revenue. Management seems comfortable that these issues are fixable, and the trend should improve over the next few quarters, the analyst notes |
| Medtronic price target lowered to $111 from $121 at Truist |
| Truist analyst Richard Newitter lowered the firm's price target on Medtronic to $111 from $121 and keeps a Hold rating on the shares. The analyst cites the company's "disappointing" Q4 results while noting that in spite of its low valuation and rising dividend, the risk-reward on the stock is "balanced" with "limited conviction" toward upside bias. Newitter adds that he would need more confidence that the Medtronic Diabetes estimate risk is in rearview and that its key pipeline initiatives will accelerate |
Alibaba price target raised to $145 from $132 at Truist |
| Truist analyst Youssef Squali raised the firm's price target on Alibaba to $145 from $132 and keeps a Buy rating on the shares. The analyst states that while the company is not "out of the woods" from macro headwinds, he is more positive on the stock given the bullish commentary from China's Vice President about upcoming measures to boost the economy, the positive early signs for Chinese audit concessions in the face of U.S. de-listing threats, and the management's cost optimization efforts to alleviate Alibaba's short-term margin pressures |
And here is what I am watching today: EXPE, HSKA, APPS, AI, TREE, ROKU, INTU, U, POOL, SITE, TNDM, SQ, YOU, PLCE, and MELI.
Let's have a great day!
-JB