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Two sessions into the trading week, things are looking up. Since bottoming out Friday afternoon, down as much as -4% in just a couple days, we’re now in the green for three of four major indices as of Tuesday’s close. The Dow picked up +263 points, +0.69%, while the S&P 500 almost doubled that performance, +1.20%. The Nasdaq, the only of these indices still in the red over the past week, gained +245 points today, +1.59%. And the small-cap Russell 2000 outperformed the field for the session, +1.79%.
TeslaTSLA, so far having a crummy 2024, is up +7% following the release of its Q1 results after today’s close. Earnings of 45 cents per share missed the Zacks consensus by a penny, while $21.03 billion in quarterly revenues came up short of expectations of $22.15 billion. Guidance for auto deliveries in 2024 are “notably lower” than they were last year, which was hinted at in its deliveries report a couple weeks ago. So why are shares climbing so nicely on such lousy quarterly numbers"
The answer, as it often is with Tesla, is this: the future. Noted in Tesla’s letter to investors today was the +130% growth in A.I. training, which pertains directly to its “robo-taxi” program — self-driving cars. There is an August 8th event pending on just this topic, which may be just the salve this beaten-down stock needs at this point. The company reported negative free cash flow and more EV competition than ever before. The company also plans to accelerate its development of lower-priced vehicles.
VisaV, on the other hand, beat estimates on both top and bottom lines for its fiscal Q2 this afternoon. Earnings of $2.51 per share outpaced the $2.43 expected (and nicely above the $2.09 per share from the year-ago quarter), with revenues in the quarter of $8.78 billion shooting past the $8.60 billion analysts were looking for. Visa called consumer spending “stable,” with volume +8% and processed transactions +11%. Shares are up +2.5% in late-session trading.
Texas InstrumentsTXN shares are also up nicely — +5.5% at this hour — on Q1 top and bottom-line beats. Earnings of $1.20 per share easily surpassed the $1.06 in the Zacks consensus, while revenues came in at $3.66 billion, bettering the $3.61 billion anticipated (though still down -16% year over year). Two quarters ago, T.I. posted its first negative earnings surprise in five years. Guidance remained in-line with previous estimates across the board.
Tomorrow brings us more Q1 earnings reports. In the morning, we’ll get Boeing’s BA quarterly performance numbers, with Meta Platforms META, Chipotle CMG, Ford F and IBMIBM all reporting after the bell. We’ll also see Durable Goods Orders for March. Today’s economic prints were mixed: S&P flash PMIs for Services and Manufacturing in April came in lower than expected and below previous-month levels, while New Home Sales notably outperformed expectations.
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Zillow Group’s growth can be attributed to its Premier Agent Business, new construction marketplaces and increasing traffic at its mobile apps as well as websites.
Globus Medical continues to gain from surging demand for its Musculoskeletal Solutions products. Meanwhile, the company is expanding in the overseas markets through the expansion of direct and distributors sales force.
Teradyne benefits from strong demand for its testing solutions in automotive, HBM, DDR5, LPDDR5, flash and aerospace and defense businesses. Strong demand for UR20 bodes well for the Robotics business.
Systematic capital investments to strengthen infrastructure, strong liquidity and the expanding natural gas customer base are going to drive its performance.
Sarepta received FDA approval for Elevidys, the first one-shot gene therapy for treating DMD. Based on this approval, it has started exploring opportunities in the gene therapy space.
TE Connectivity’s harsh-environment application business and industrial solutions are positives. Secular trends in autonomous driving systems and infotainment areas are tailwinds.
Strong cash flows in storage and records management business, and focus on data center business are positives for Iron Mountain. Also, an aggressive acquisition strategy supplements organic growth.
Intensifying competition is likely to make Atlassian resort to competitive pricing in an effort to maintain and gain further market share. A decelerating customer growth rate, softened IT spending and integration risks are other concerns.
Huntsman is seeing pressure from lower selling prices. The company also faces headwinds from weak demand in Europe and China. Elevated input costs may also hurt margins.
MGIC Investment's high underwriting and other expenses weighing on margin expansion, high debt level with lower interest coverage ratio and highly competitive insurance market is a concern.
Agricultural market conditions remain weak. Higher raw material costs are also hurting margins in the Infrastructure segment. Elevated levels of capital expenditure are added concerns.
Rising e-commerce adoption and limited consumers’ willingness to spend amid macroeconomic uncertainty are key concerns for SITE Centers. A high interest rate environment adds to its woes.
Google has shown good execution to date. Its dominant search market share is a positive. Its expanding cloud footprint and strengthening presence in the smart home market remain noteworthy.
Netflix’s growing subscriber base, driven by content strength, focus on originals across various genres and languages, rapid international expansion and partnerships with telcos are key drivers.
Kroger is making investments to enhance product freshness and quality, and expand digital capabilities. Impressively, it has been introducing new items under its ‘Our Brands’ portfolio.
Amgen expects strong sales growth of products like Tezspire, Evenity, Repatha, Prolia and Tavneos to offset lower revenues from oncology biosimilars and legacy established products such as Enbrel in the future quarters.