Earnings in focus – market today (April 26th)

Today’s main global market news –

1. After positive Microsoft and Alphabet reports, Nasdaq futures increased by more than 1%.
2. Microsoft Jumps, Lifting Dow Jones Futures; S&P 500 Reels as First Republic Collapses
3. Chinese contract chip manufacturer sponsored by SMIC aims to raise US$1.4 billion on Shanghai’s Star Market.
4. Following a sharp decline in deposits, First Republic’s stock sees a nearly 50% loss in value.
5. China Stock Selloff Pauses Following Value Loss of $446 Billion
6. Alphabet stock increases after strong earnings. The buybacks are increasing as well.
7. Dollar drops following overnight advances; positive sentiment is boosted by tech profits
8. Higher revenues and lower expenses helped Assa Abloy Q1 surpass expectations.
9. As oil falls, it increases US inventories shift market attention to demand
10. Puma anticipates Q2 sales growth to fall short of full-year objective.
11. Reckitt appoints Kris Licht as CEO and surpasses sales projections
12. Glencore circles as Teck Resources‘ earnings falls short of expectations.
13. Safran reports solid sales, but worries about supply chain issues
14. GSK surpasses first-quarter revenue and profit projections
15. Nomura’s Q4 earnings in Japan fell 76% as deal activity dropped.
16. German consumer confidence rises as income expectations rise. – GfK
17. Shares of Microsoft rose 8% after revenues were boosted by AI, above predictions.
18. Google’s Alphabet surpasses forecasts, but revenue growth is slower
19. Republican senators want Biden to impose penalties on Chinese cloud service providers.
20. UPS tempers its 2023 revenue projection as freight volumes continue to be constrained.
21. As economic uncertainty overcomes Chinese confidence, oil prices decline by $2.
22. Gap plans to terminate hundreds of workers in a fresh wave of layoffs – WSJ
23. Donald Trump is accused of rape and is on trial.
24. As a result of sluggish consumer electronics demand, 3M will eliminate 6,000 jobs internationally.
25. Republicans in the US House anticipate victory in the looming debt-ceiling vote.
26. Despite the possibility of a recession, McDonald’s sales are up.
27. Despite rising prices, U.S. hotels are expected to see increased revenue from travellers.
28. According to a court document, British American Tobacco PLC will admit guilt for breaking NKorea sanctions.
29. Results for Advanced Micro Devices’ Q1 are anticipated to be in line, and Stifel anticipates positive long-term trends.

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U.S. market today

Market Technical -by Gurmeet Sohi

Market closed in deep red yesterday

Market staying in range bound

Trend is still up in short term

Resistance is near 34320 

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MARKET MOVERS

STOCKS IN NEWS 

•  McDonald’s Corp MCD:- Q1 adj EPS $2.63 vs. est. $2.33; Q1 comparable sales +12.6% vs. +11.8% y/y and estimate +8.19%; Q1 revenues $5.90B, +4.1% y/y vs. est. $5.57B

• Nestle ADR NSRGY:-  Q1 Sales +5.6% to CHF23.5b; Q1 Organic Growth at 9.3%; Confirms FY O/L for Organic Growth of 6-8%; Raising EPS by 6-10%

• PepsiCo, Inc.-  PEP follows KO on Monday with positive guidance and a beat: Q1 core EPS of $1.50 vs $1.39; Q1 revenues of $17.85 billion versus $17.22 billion; Q1 organic revenue of +14.3% versus +9.47%; and FY23 core EPS of $7.27 versus $7.20

• Halliburton Company- HAL reported first-quarter earnings per share of $0.72, above estimates of $0.67, as revenue increased by 44% to $2.8 billion in North America and by 32.5% to $5.68 billion overall.

• Coca-Cola Europacific Partners PLC- CCEP Q1 sales of €4.15 billion was more than expected ($3.98 billion), while comparable volume increased by 4.0% and revenue increased by 12.0%, respectively. The company also reiterated its outlook for FY23.

• Kimberly Clark Corp – KMB said that Q1 gross margin increased by 340bps to 33.2% as EPS and revenue above forecasts. This boosts 2023 profit estimates to reach +6%-10% from its earlier prediction of 2%-6% while keeping its expectations for yearly net sales and organic sales growth.

• General Motors Company- GM Q1 sales and profit exceeded forecasts, raising FY FCF outlook from previous to $5.5B-$7.5B. $5B-$7B; FY adj Ebit is $11B-$13B higher than in the past $10.5B to $12.50B; increases

• Asbury Automotive Group, Inc- In the LiDAR market, ABG reports a Q1 revenue shortfall. Due to its complete stack platform, LAZR Assume at Buy at Jefferies with a $7 target price as they feel the firm is best positioned to secure a dominating share in the emerging LiDAR industry.

• Range Resources Corp-  Following a Q1 EPS beat ($1.95 vs. est. $0.89), RRC’s stock was raised to Buy at Benchmark as revenues and other income more than doubled to $1.19B from $180.7M year over year.

• Fiserv Inc FISV -1Q adj. EPS $1.58 vs. estim. $1.57 on $4.55 billion in revenue against expectations. $4.19B; forecasts FY organic revenues of 8 to 9%. vs. estimate, +6.9% and adj EPS of $7.30–7.40. $7.34.

• Verizon Communications Inc. VZ-  Q1 adj EPS remained constant at $1.20 despite a revenue miss ($32.9B vs. est. $33.57B); the company also issued guidance for FY23 adjusted EPS of $4.55-$4.85 vs. est. $4.70 and anticipates 2.5% to 4.5% increase in total wireless service revenue; Q1 saw a decline of 127K net new monthly bill-paying cellular phone users.

• Aarons Company (AAN) Q1 adj EPS $0.66 vs. est. $0.27; Q1 revenue $554.4 vs. est. $564.91; FY revs estimate drops to $2.15B-$2.25 from prior $2.2B-$2.3B; year EPS view improves to $1.00-$1.40 from prior $0.70-$1.10; and FY adj Ebitda $140M-$160M.

• Heidrick & Struggles’s (HSII) 1Q EPS of $0.76 beat estimates. $0.64 on $242.12M in revenues vs expectations. $245.14M; 2Q revenue is $260-280M more than expected. $253Mm.

• PulteGroup (PHM) Q1 adj EPS $2.35 vs. est. $1.81; Q1 revs $3.58B vs. est. $3.27B; Q1 closings increased 6% to 6,394 homes; average sales price increased 9% to $545,000; Q1 gross new orders higher by 1% to 8,898 homes; net new orders decreased 8% to 7,354 homes; Q1 unit backlog of 13,129 homes with a value of $8.0B.

• Whirlpool Corporation (WHR) 1Q EPS $2.66 vs. est. sales of $2.28 $4.65B compared to expectations. $4.5B; adj EBIT mgn 5.4%; maintains FY net sales approx. $19.4B vs. est. $16.00 to $18.00 per share based on continued EPS of $19.0B. $15.82; no change from prior year; cash from operating operations of around $1.4B; free cash flow of about $800Mm.

• ChampionX Corp.’s (CHX) 1Q adj EBITDA was $175.6Mm vs. expectations. Revs of $169.4M $948.3Mm in comparison to the estimate. $968.7Mm.

• Nabors Industries (NBR) The first-quarter adjusted EBITDA of $240 million for Nabors Industries (NBR) was more than expected. $779.14M in operational revenue vs. an estimate of $241.7M. $773.58M; estimates FY adj FCF at $400M.

• Range Resources (RRC) Q1 adj EPS $0.99 vs. est. $0.82; guides FY 2023 exploration spend $22M-$28M; capex for 2023 $570M-$615M; aiming for a maintenance programme in 2023, leading in about stable output at 2.12Mb/d.

  Ameriprise Financial (AMP) reported Q1 earnings per share of $7.25 vs the expected $7.21; Q1 revenues of $3.74 billion versus the expected $3.71 billion; an 8% increase in the quarterly dividend; and assets under management and administration of $1.2 trillion, an 8% decrease due to significant net inflows from clients.

• Cadence Bank (CADE) Q1 adj EPS $0.68 vs. est. $0.66; Q1 credit loss provision $10M; increase in total deposits of $449.8 million or 4.7% annually; loan-to-deposit ratio of 79.4%; net interest margin at 3.29%, down 4 basis points.

• First Republic (FRC) Q1 EPS $1.23 vs. est. $0.85; Q1 revenue fell -13% year over year to $1.20B vs. est. $1.15B; said profit fell 33% to $269M from $401M year over year; Q1 net interest income $923M, credit loss provisions $16M; deposits fell 40% to $104.5 billion in Q1 but have stabilised since; bank to cut 20-25% of its workforce and explore strategic options.

• UBS Group AG (UBS) reported a $1.03 billion net profit in the first quarter of the year, a 52% decrease from the same period the previous year. The company’s operational profit declined over the same time period from $2.72 billion to $1.49 billion, while its diluted earnings per share for the three-month period was $0.32.

• 3M (MMM) discloses restructuring moves claiming would slash costs at corporate centre; restructuring will effect roughly 6,000 positions globally; reports top management team changes; upholds FY forecasts. Q1 adj EPS $1.97 vs. est. $1.57; Q1 revenues $8.0B vs. est. $7.48B.

• General Electric (GE) Q1 adj EPS $0.27 vs. est. $0.14; Q1 revenues $14.5 B vs. est. $13.36 B; FY23 adjusted EPS raised to $1.70-$2.00 from prior $1.60-$2.00 view (est. $1.98); FY free cash flow increased to $3.6 B-$4.2 B from prior $3.4 B-$4.2 B; continues to expect high-single-digit revenue growth for 2023.

• Canadian National (CNI) increased its FY23 adj EPS forecast from up low single digits to up mid-single digits; it continues to expect negative North American industrial production. Q1 EPS was C$1.82 compared to C$1.32 last year; Q1 revenue was C$4.31 billion compared to C$3.71 billion.

• Cleveland Cliffs (CLF) reported Q1 EPS loss of (-$0.11) vs loss estimate of (-$0.19) and Q1 revenue of 45.3B versus estimate. $5.21B; reduces FY23 CapEx outlook from $700M–750M to $675M–725M.

• Hexcel Corp. (HXL) reported $0.50 in first-quarter earnings per share, above estimates of $0.38 and $457.7 million in revenue. $430.0M; reiterates FY FC more than $140M, EPS of $1.70 to $1.90 (approx. $1.85), and revenue expectations of $1.725 to $1.825 billion versus $1.78 billion.

• Packaging Corp. (PKG) Q1 adj EPS $2.20 vs. est. $2.27; Q1 revenues declined -7.5% y/y to $1.98B vs. est. $2.07B; and Q2 EPS is expected to be $1.96 vs. $2.55 (watch other paper stocks IP, WRK following Q1 miss and lower guidance).

• Simpson Manufacturing’s (SSD) 1Q EPS of $2.05 was better than expected. $1.40 on sales of $534.4 million against expectations. $483.6M; advises FY operational management 19–21%; tax rate 25–26%.

• Cadence Design (CDNS) Q1 EPS $1.29 vs. est. $1.25; Q1 revenue $1.02B vs. est. $1.01B; increases FY23 EPS outlook to $4.96-$5.04 from $4.90-$5.00 (approx. $4.98) on revenues $4.00B-$4.06B; Q1 adj Ebitda margin 42%.

• Tenable Holdings’ (TENB) 1Q adj EPS of $0.11 above expectations. $0.03 for sales $188.84M compared to the estimate. $187.1Mm; 2Q revenue is $189-191Mm vs. estimate. $193.8M and adj EPS of $0.12-0.13 vs estimate. $0.10; sees FY revs $775-785Mm vs est. $805.4Mm and adj EPS between $0.57 and 0.61 vs. est. $0.53.

        Tuesday, April 25, 2023

•  TIME                           EVENT

  07:00                    MBA Purchase Index

  07:00                   Mortgage Market Index

  08:30                  Core Durable Goods Orders (MoM) (Mar)

  08:30                  Retail Inventories Ex Auto (Mar) 

  10:30                  Crude Oil Inventories

  13:00                  5-Year Note Auction

   

  Major Events for This week

• Megacap earnings

All three companies are expected to report, with Microsoft (NASDAQ:MSFT), Alphabet, the parent company of Google (NASDAQ:GOOGL), and Amazon (NASDAQ:AMZN) doing so on separate days (Tuesday and Thursday, respectively). Wednesday’s sandwich features Meta Platforms, parent company of Facebook (NASDAQ:META).

• Earnings of European banks

The following week will see the release of earnings reports from many renowned European banks, including UBS (SIX:UBSG), Deutsche Bank (ETR:DBKGn), Santander (BME:SAN), and Barclays (LON:BARC).

• GDP for Europe

On Friday, the Eurozone will reveal preliminary figures on first-quarter GDP, and the same day, the region’s three major economies—Germany, France, and Spain—will issue their April inflation numbers.

• The BOJ will be headed by a new governor.

Despite not anticipating any changes to the ultra-dovish monetary policy of the central bank, new Bank of Japan Governor Kazuo Ueda will preside over his maiden policy meeting on Friday.

• Major economic events

WEDNESDAY 

API & EIA CRUDE OIL STOCK CHANGE,

MBA MORTGAGE APPLICATIONS (FOR) WEEK ENDED APR 21:

DURABLE GOODS ORDERS (MAR)

THURSDAY 

GDP GROWTH, PCE PRICES

REAL CONSUMER SPENDING (ADVANCES ESTIMATES Q1CY23)

INITIAL JOBLESS CLAIMS (FOR WEEK  ENDED APR 22)

PENDING HOME SALES (MAR)

EURO AREA :- ECONOMIC, INDUSTRIAL

SERVICES SENTIMENT,

CONSUMER CONFIDENCE (APR)

FRIDAY 

PERSONAL INCOME & SPENDING (MAR),

EMPLOYMENT COST INDEX (Q1),

CHICAGO PMI (APR)

EURO AREA:-  GDP GROWTH FLASH (Q1CY23)

EARNING BEFORE THE  OPENING :

BOEING, HUMANA, HILTON, HESS, TECK, ADP, THERMOFISHER SCIENTIFIC, GENERAL DYNAMICS, BOSTON SCIENTIFIC, CENOVUS ENERGY.
oche Holding ADR (RHHBY), Thermo Fisher Scientific (TMO), Boeing (BA), American Tower (AMT) , ADP (ADP), GSK plc DRC (GSK), Boston Scientific (BSX), CME Group (CME),Safran SA (SAFRY), Humana (HUM), General Dynamics (GD), Reckitt Benckiser ADR (RBGLY), Dassault Systemes SA (DASTY), Norfolk Southern (NSC), Amphenol (APH), Hess (HES), Danone PK (DANOY), TE Connectivity (TEL), Hilton Worldwide (HLT)

EARNING AFTER THE CLOSE:   

META, ROKU, SERVICENOW, PIONEER NETURAL RESOURCES, TELADOC HEALTH, ALIGN, UNITED RENTALS, KLA. ServiceNow Inc (NOW), Canadien Pacifique Kansas City (CP), Waste Management (WM), Vale ADR (VALE), O’Reilly Automotive (ORLY), Edwards Lifesciences (EW), Pioneer Natural (PXD), KLA Corp (KLAC), American Water Works (AWK), Align (ALGN), Arch Capital (ACGL), United Rentals (URI), eBay (EBAY), Biomarin Pharma (BMRN), Mid-America Apartment (MAA), Sun (SUI), ICON PLC (ICLR), Tenaris ADR (TS), Molina Healthcare (MOH)IDEX (IEX), Tyler Technologies (TYL), Teradyne (TER), Aspen (AZPN), PTC (PTC), UDR (UDR), WillScot A (WSC), Morningstar (MORN)

Economic data

Consumer Confidence index for April Consumer expectations index reported at 68.1 in April vs. March revised 74.0 (previous 73.0), consumer confidence index reported at 101.3 in April vs. 104.0 consensus and 104.0 prior (revised from 104.2), and present situation index reported at 151.1 vs. 148.9 prior (previous 151.1).

 New Home Sales for March rose The median sales price of new homes sold in March was $449.8K, while the average sales price was $562.4K; March new home supply was 7.6 months at the present rate, compared to 8.4 months in February. New home sales increased by 9.6% month over month to 683K from 630K consensus and 623K before (updated from 640K).

The Richmond Fed Manufacturing reported -10 vs the expected -8; the shipments index was -7 in April versus the +2 in March; and the services revenues index was -23 in April versus the -17 in March.

U.S. home prices increased by 0.5% in February compared to January, according to the U.S. Home Prices Index, which stood at 394.8 in February.

U.S. February 20-metro area house prices increased by 0.4% from a year ago compared to revised January values of +2.6%; February 20-metro area home prices up by 0.1% seasonally adjusted compared to January values of -0.4%; and February 20-metro area home prices increased by 0.2% unadjusted compared to January values of -0.6%.

Other Key Events:

•     American Academy of Neurology, 4/24-4/27, in Boston, MA
•     RSA Conference 2023, 4/24-4/27, in San Francisco, CA

Must read book about investing – check here

Indian Market 

FII AND DII 

FII SOLD            407.35 CR

DII BOUGHT       563.61 CR

According to preliminary statistics from the National Stock Exchange, on April 25, foreign institutional investors (FII) sold shares worth Rs. 407.35 crore while domestic institutional investors (DII) purchased shares worth Rs. 563.61 crore.

Indian markets NEWS

1. 1. Nifty beyond 17,800, Sensex up 170 points, driven by the auto, real estate, and capital goods sectors
   2. Anant Raj Q4 profit increased by 118% year over year to Rs 49.4 crore, and revenue increased by 30% to Rs 280 crore.
   3. NII increases by 29.5%, while Q4 profit at AU Small Finance Bank increases by 23% to Rs 425 crore.
   4. Q4 net profit for Tanla Platforms declines by 14.5%
   5. Maruti Suzuki Q4 net profit up 42.6% year over year
   6. KPIT Technologies declares a final dividend of Rs. 2.65 per share and an increase in Q4 earnings to Rs. 111.6 cr.
   7. Shares of VST Industries are down 3% after a 21% decline in Q4 net earnings.
   8. Rallis India shares decline more than 2% as a result of negative Q4 2022 results.
   9. Dhampur Bio Organics increases 13% due to solid Q4 results.
   10. After the Q4 result, AU Small Finance Bank’s stock price fell.
   11. Tata Consumer Products’ fourth quarter net profit increased by 23.4%.
   12. Shares of Crompton Greaves CE plunge nearly 13% to reach a 52-week low.
   13. ICICI Bank will achieve its 52-week high; long-term growth of 27% is anticipated
   14. Tata Steel Long Products reported a Q4 loss of Rs. 184 cr.
   15. Bajaj Auto Q4 performance exceeded expectations.
   16. Vijay Mehta is elected president of ANMI.
   17. Street is surprised by Nestle’s biggest revenue increase in ten years. 

Indian market Today  

INDIAN MARKET MOVERS  

STOCK IN NEWS

Dalmia Bharat Ltd Up 16% to Rs 3,912 crore in revenue. Dalmia Bharat Ltd., a manufacturer of cement, stated on Tuesday that its consolidated net profit for the fourth quarter of the fiscal year 2022–23 increased by two times, to Rs. 609 crore. According to a regulatory filing by Dalmia Bharat, the business reported a net profit of Rs 271 crore for the January-March quarter of last year.

Dalmia Bharat Ltd Up 16% to Rs 3,912 crore in revenue. Dalmia Bharat Ltd., a manufacturer of cement, stated on Tuesday that its consolidated net profit for the fourth quarter of the fiscal year 2022–23 increased by two times, to Rs. 609 crore. According to a regulatory filing by Dalmia Bharat, the business reported a net profit of Rs 271 crore for the January-March quarter of last year.

Mahindra Lifespace Developers: Due to a high base, the real estate developer reported a profit of Rs 0.54 crore for the quarter ended March FY23, a significant decrease from Rs 137.7 crore in the same time previous year. In Q4FY22, the firm generated extraordinary gains of Rs. 96.8 crore.

Bajaj Auto: Despite strong topline and operating performance, which were influenced by high base, the two- and three-wheeler manufacturer posted a year-over-year fall in standalone profit of 2.5 percent at Rs. 1,433 crore for the quarter ended March FY23. Despite a 12.5% decline in sales volumes, the quarter’s revenue of Rs 8,905 crore increased over the same period last year by 11.66%. EBITDA increased by 220 bps YoY for the quarter, or 25.7%, to Rs 1,717 crore. The business has disclosed.

Tata Consumer Products: In all respects, the FMCG company’s Q4FY23 results exceeded expectations. Revenue from operations climbed by 14% to Rs 3,618.7 crore during the quarter, while profit improved by 21% YoY to Rs 289.6 crore, primarily due to underlying growth of 15% in India business, 6% in overseas business, and 9% in non-branded business.

Dalmia Bharat: Despite lower margin, the business recorded a staggering 121.4% year-over-year increase in Q4FY23 consolidated profit at Rs 589 crore, helped by profit from joint ventures of Rs 529 crore in Q4FY23 compared to zero in same time previous year. 

AU Small Finance Bank: For the quarter that ended in March of FY23, the small finance bank saw a 23% year-over-year increase in profit at Rs 425 crore, with provisions and contingencies reducing 56% YoY. For the quarter, net interest income increased by 29.5% YoY to Rs 1,213 crore. Asset quality improved for Q4FY23, with net non-performing assets (NPA) decreasing 9 bps QoQ to 0.42% and gross non-performing assets (NPA) as a percentage of gross loans lowering 15 bps QoQ to 1.66%.

Mahindra CIE Automotive: The auto auxiliary firm had a 73% increase in profit year over year for the March FY23 quarter, which was aided in part by solid operating and topline results. When compared to the same quarter last year, operating revenue increased by 18.4% to Rs 2,440.2 crore.

VST Industries: Due to a worse operating performance and lower topline, the maker of cigarettes reported a 21.2% year-over-year fall in Q4FY23 earnings at Rs 68.7 crore. To reach Rs 389.1 crore, revenue for the quarter decreased by 2.8% YoY.

Nippon Life India Asset Management: The company’s consolidated profit increased by 13.25% year over year to Rs 198.02 crore for the quarter ended March FY23, mostly due to decreased tax expenses. For the quarter, operating revenue increased by 3% YoY to Rs 348.34 crore. A dividend of Rs 7.5 per share for FY23 has been declared by the board.

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