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More Flat Markets; Salesforce, Snowflake Beat in Q4
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Markets closed again within 1% above or below zero balance today; we continue to be trading “flat” while a new catalyst leads the market narrative somewhere more definitive. The Nasdaq and the S&P 500 were under water all day long, while the Dow and small-cap Russell 2000 were influx right around sea level. The Dow closed +0.03%, while the S&P was -0.47%. The Nasdaq performed the worst on the day, -0.66%, while the Russell was the best: +0.10%.
After the market open this morning, we saw some productivity numbers that are worth sharing: ISM Manufacturing for February was a tick higher than estimates to +47.7%, following an unrevised +47.4% the previous month. We are seeing new and backlog order shrinking at a slower rate, but we’re still decidedly beneath the 50% level that determines expansion from contraction. Production declines were steeper in the month, and employment was down in the sector.
S&P Manufacturing PMI headlined notably beneath its preliminary read: +47.3 versus +47.8 posted earlier. This marks the fourth straight month lower, even as employment in this metric rose to its highest level in five months. Input costs rose at a lighter rate overall, but again, we’re still below that “magic 50” mark. The last time PMI Manufacturing was over 50 was back in October 2022.
Construction Spending for January also hit the tape after today’s closing bell, with a disappointing headline of -0.1% a swing to the negative from the expected +0.3%, and revised down the previous month from -0.4% originally reported to -0.7% now. This makes four of the last six quarters with Construction Spending in the negative, averaging -0.167% over the trailing six months; the previous six months averaged +0.867% for this metric.
Salesforce.com (CRM - Free Report) shares are spiking more than +14% following its Q4 earnings release, where the CRM innovator trounced estimates on both top and bottom lines: earnings of $1.68 per share easily surpassed the $1.36 expected (and double the 84 cents per share reported in the year-ago quarter) on revenues of $8.38 billion, which outperformed the $7.99 billion analysts were looking for. The company looks to be getting control of its business costs, and gave margin guidance higher than analysts had been expecting.
On the CRM conference call, we expect to hear more about activist investor involvement. But if these are the sorts of results we can expect from salesforce.com going forward, it will be hard to find fault with the current program. Next-quarter revenue guidance was also raised, to $8.18 billion from $8.09 billion in the Zacks consensus. CRM shares had already gone up +24% year to date, though had been -20% since this time last year.
Montana-based cloud data storage company Snowflake (SNOW - Free Report) also outperformed expectations on its top and bottom lines after the bell, but shares are selling off -7% in late trading. Earnings of 14 cents per share easily beat the 3 cents analysts had projected, on revenues of $589 million, outpacing the $571.6 million estimated. Product revenues were up in the quarter, with full-year guidance now for $2.705 billion, plus the company announced a $2 billion share buyback. Backlog growth, however, dwindled to +40% from +47% earlier guided.
Image: Bigstock
More Flat Markets; Salesforce, Snowflake Beat in Q4
Markets closed again within 1% above or below zero balance today; we continue to be trading “flat” while a new catalyst leads the market narrative somewhere more definitive. The Nasdaq and the S&P 500 were under water all day long, while the Dow and small-cap Russell 2000 were influx right around sea level. The Dow closed +0.03%, while the S&P was -0.47%. The Nasdaq performed the worst on the day, -0.66%, while the Russell was the best: +0.10%.
After the market open this morning, we saw some productivity numbers that are worth sharing: ISM Manufacturing for February was a tick higher than estimates to +47.7%, following an unrevised +47.4% the previous month. We are seeing new and backlog order shrinking at a slower rate, but we’re still decidedly beneath the 50% level that determines expansion from contraction. Production declines were steeper in the month, and employment was down in the sector.
S&P Manufacturing PMI headlined notably beneath its preliminary read: +47.3 versus +47.8 posted earlier. This marks the fourth straight month lower, even as employment in this metric rose to its highest level in five months. Input costs rose at a lighter rate overall, but again, we’re still below that “magic 50” mark. The last time PMI Manufacturing was over 50 was back in October 2022.
Construction Spending for January also hit the tape after today’s closing bell, with a disappointing headline of -0.1% a swing to the negative from the expected +0.3%, and revised down the previous month from -0.4% originally reported to -0.7% now. This makes four of the last six quarters with Construction Spending in the negative, averaging -0.167% over the trailing six months; the previous six months averaged +0.867% for this metric.
Salesforce.com (CRM - Free Report) shares are spiking more than +14% following its Q4 earnings release, where the CRM innovator trounced estimates on both top and bottom lines: earnings of $1.68 per share easily surpassed the $1.36 expected (and double the 84 cents per share reported in the year-ago quarter) on revenues of $8.38 billion, which outperformed the $7.99 billion analysts were looking for. The company looks to be getting control of its business costs, and gave margin guidance higher than analysts had been expecting.
On the CRM conference call, we expect to hear more about activist investor involvement. But if these are the sorts of results we can expect from salesforce.com going forward, it will be hard to find fault with the current program. Next-quarter revenue guidance was also raised, to $8.18 billion from $8.09 billion in the Zacks consensus. CRM shares had already gone up +24% year to date, though had been -20% since this time last year.
Montana-based cloud data storage company Snowflake (SNOW - Free Report) also outperformed expectations on its top and bottom lines after the bell, but shares are selling off -7% in late trading. Earnings of 14 cents per share easily beat the 3 cents analysts had projected, on revenues of $589 million, outpacing the $571.6 million estimated. Product revenues were up in the quarter, with full-year guidance now for $2.705 billion, plus the company announced a $2 billion share buyback. Backlog growth, however, dwindled to +40% from +47% earlier guided.
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