Equities opened in the green yesterday, and looked to pad gains after Tuesday’s 2.4%+ move and the global rally that took place the previous night in Asia and in Europe that morning - it was not meant to be. Some will say it was Apple that led the way, others will say just profit taking in this volatile market. Whatever the case, equities started to pare gains in the afternoon, and the selling escalated in the last hour. The DOW reversed some 400+ pts, and the S&P moved down 3% from it’s highs. Those thinking the pullback was over, got a rude awakening…
Last night Asia markets sold off, although not as bad as one would think. The Nikkei was down over 4% at points, but recouped some of the losses to close down just over 2%. Europe market seemed to fin some relief and opened in the green, only to fade over the past few hours. U.S. futures followed suit, up over 1% at points, only to reverse all the green and turn red as I write this. The Dollar is flat, Gold is higher, and treasures are weaker.
Here is what UPB is reading this morning : https://www.optionmillionaires.com/thursday-morning-reads-91015/
After the close yesterday, Brazils Debt was cut to Junk by S&P(rating company) with a negative outlook. The news, although not a surprise, did hit futures a bit and hit Brazil stocks hard - Brazil has the 7th largest economy in the world.
The Apple event brought a mixed response from many, and some humorous posts on social media. I don’t think there was as anywhere near as much hype for this event as the iPhone 6, so expectations were low. But some are always looking for AAPL for some new innovation… Analysts are out defending shares this morning.
I added some IWM & $IBB puts yesterday to play for a fade, and we sure did. I did not want to hold all the positions overnight so locked in the IWM puts for a decent gain. I think IBB will fall under $330 in the next 48 hours and will look to lock the $335puts in first and hold the $330s into tomorrow, although that plan can change at anytime.
Gold is starting to look like it wants to break under $1100(as I talked on the Week Ahead Webinar). I added some GLD puts to take advantage of that move. Still think it will come down and test it, so will hold my puts through today at minimum.
After showing great promise on Tuesday, both BIDU and NFLX held strong despite the fade. Still have my puts on both and think they both will find weakness today and tomorrow.
I am content with the positions I am currently holding for today, but may look for some more SRS calls to play for further downside.
Here are the analyst changes of note for today:
Time Inc. outlook has improved, says Wells Fargo
After meeting with Time's management, Wells Fargo reports that the company's revenue may stabilize as early as 2017, driven by the growth of digital and adjacent revenue. The firm thinks the company could benefit from strategic M&A, and it keeps an Outperform rating on the shares
Palo Alto reported 'exceptional' results, says Wells Fargo
After Palo Alto reported stronger than expected results, Wells Fargo thinks the company is executing very well and gaining market share. The firm notes that the company's Q1 guidance exceeded expectations, and it raised its price target on the name to $208-$215 from $183-$199. It keeps an Outperform rating on the shares
Time Inc. outlook has improved, says Wells Fargo
After meeting with Time's management, Wells Fargo reports that the company's revenue may stabilize as early as 2017, driven by the growth of digital and adjacent revenue. The firm thinks the company could benefit from strategic M&A, and it keeps an Outperform rating on the shares
nder Armour pullback brings 'good buying opportunity,' says FBR Capital
FBR Capital analyst Susan Anderson notes that while shares of Under Armour have rallied off their lows, they are still down 6% from the August high. The Q3 earnings report and investor day on September 16 are potential positive catalysts for the stock, Anderson tells investors in a research note. She sees a "good buying opportunity" at current levels and keeps an Outperform rating on Under Armour with a $105 price target
Apple shares 'could work higher,' says RBC Capital
RBC Capital believes that Apple's new iPhones will be more profitable than any of their predecessors, since the iPhone 6S will be more expensive. The firm expects the company's results to be boosted by its new leasing program. It predicts that the stock "could work higher" after next week's sales numbers are unveiled and initial demand for the new iPhones is revealed. RBC keeps a $150 price target and Outperform rating on the shares
Seagate initiated with a Sell at UBS
Target $38
Western Digital initiated with a Sell at UBS
Target $71
Apple new products to drive 14% earnings growth in 2016, says JPMorgan
JPMorgan analyst Rod Hall estimates the new products Apple announced yesterday will add about 3% to his 2016 earnings forecast. The iPhone maker should now post 2016 earnings growth of 14%, which is well above the S&P's forward 12-month earnings growth of just 8%, Hall tells investors in a research note. Apple should also provide a dividend yield of 2% next year, assuming continuation of the current buyback rate, the analyst predicts. He finds the stock's "value proposition attractive" and reiterates an Overweight rating on Apple with a $145 price target. Shares closed yesterday down $2.16 to $110.15
CBS upgraded to Buy from Hold at Deutsche Bank
Deutsche Bank analyst Bryan Kraft upgraded CBS to Buy citing a "depressed" multiple and expectations for accelerating earnings growth. Cost pressures are easing, ad revenue expectations are achievable and Showtime's over-the-top service should be an earnings driver in 2016, Kraft tells investors in a research note. He believes CBS's earnings growth is at an inflection point and sees limited risk to earnings estimates. The analyst cut his price target for shares to $60 from $67
Palo Alto price target raised to $200 from $185 at Piper Jaffray
Piper Jaffray analyst Andrew Nowinski raised his price target for shares of Palo Alto Networks to $200 saying the company "continues to deliver across all metrics" following its Q4 results. Palo Alto is one of the best positioned vendors in the cybersecurity space, Nowinski writes. He reiterates an Overweight rating on the stock
Facebook Instagram expansion positive, says Cantor
After Facebook announced that small and medium businesses would be allowed to advertise on Instagram for the first time, Cantor says that Instagram ads could generate $1B+ in revenue for the company in the near-term. The firm keeps a $105 price target and Buy rating on the shares
Dollar Tree downgraded to Underperform on Family Dollar risk at Credit Suisse
Credit Suisse downgraded Dollar Tree to Underperform from Neutral and lowered its price target to $60 from $70. Analyst Edward Kelly remains cautious on Dollar Tree's acquisition of Family Dollar given execution risk and said the transaction is not living up to initial expectations. Kelly said Family Dollar's recent results were disappointing and management was unwilling ot endorse it previous first full year accretion guidance. The analyst believes the Street may be underestimating potential investment needed at Family Dollar and believes further downside in shares is likely
BlackRock upgraded to Outperform from Neutral at Credit Suisse
Credit Suisse upgraded BlackRock to Outperform citing discounted valuation, net flow visibility, high earnings, defensive positioning for a higher rate environment, high earnings, and deep management bench, among other reasons
Box reported strong results, says Pacific Crest
Pacific Crest believes that Box reported strong results across all of its operations, while the company's new modules are beginning to gain traction. The firm says that the stock is "compelling," and keeps a $24 price target and Overweight rating on the shares
ULTA Beauty initiated with a Sector Perform at RBC Capital
Target $168
Apple consensus for next two quarters currently too low, says Brean Capital
Brean Capital said they see earnings upside for Apple and a bounce in its share price in the second half of the year. The firm believes the iPhone 6S upgrade cycle will be the determining factor in the next true elongated stock move and that Street estimates for the next two quarters are currently too low. Brean Capital reiterated its Buy rating and $170 price target on Apple shares
And will be keeping things small today and look to add some OCT strikes if possible on SRS:
|
Stock Ticker |
Call/Put |
Strike |
Expiration |
Closing Price |
Possible Entry Price |
|
SRS |
Call |
$70.00 |
October |
.51 x 1.22 |
0.90 |
Lets have a great day!
- JB