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Pre-Markets Green but Losing Steam; ANF, FL, KSS Report
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Pre-market futures are modestly higher, with the exception of the small-cap Russell 2000, which is marginally down at this hour. Futures had been all nicely in the green earlier this morning, so we’re seeing a downward bias in the past hour or so. The Dow is +20 points currently (as opposed to +150 an hour ago), the Nasdaq +19 points, the S&P 500 +3 points and the Russell -1.3%.
Zacks Rank #1 (Strong Buy)-rated Abercrombie & Fitch (ANF - Free Report) posted a huge earnings beat in its Q2 this morning — $1.10 per share versus 13 cents expected — on revenues of $935.3 million in the quarter, well ahead of the $842.4 million in the Zacks consensus. Net sales grew +10%, easily surpassing the 2-4% analysts had been expecting. Flagship Abercrombie stores were up +23% year over year, +13% across all stores. This is the second-straight gigantic earnings beat in a row (the previous month’s beat was by +2050%!) and shares are trading up +15% in the early market.
Foot Locker (FL - Free Report) is on the other end of the spectrum this morning, with earnings of $0.04 per share on $1.86 billion in quarterly revenues — below the $0.05 per share and $1.88 billion estimated, respectively. Heavy promotional markdowns in the quarter brought overall comps -9.4%, while the the company is pausing its dividend yield and slashing full-year earnings guidance to $1.30-1.50 per share from $2.07 in the Zacks consensus. Expect downward revisions here, and the stock has fallen -30%v in today’s pre-market already.
Kohl’s (KSS - Free Report) managed to split the difference: earnings posted a big beat — 52 cents per share versus 24 cents expected — while revenues of $3.68 billion missed the $3.90 billion consensus estimate in the quarter. The company managed to reduce inventory by -14%, though these were not as low as analysts had expected. Yet shares are up +1% in today’s pre-market, following nearly +5% gains year to date (which still underperforms the S&P so far this year).
After the open today, S&P flash U.S. Manufacturing and Services PMI for July are coming out. Manufacturing is expected to slip a smidge further below 50-breakeven to 48.9% from 49.0% posted a month ago. Services look to remain nicely above the 50-mark, 52.5% expected versus 52.3% reported for June. We’ll also get New Home Sales for July, expected to climb to 703K for the month from 697K last posted. This follows yesterday’s Existing Home Sales which reached their lowest levels since January, -2.2% to 4.07 million seasonally adjusted, annualized units.
We also get reports out of Jackson Hole, WY beginning tomorrow from the annual Economic Symposium. These should serve, as per usual, as a proxy for the latest Fed meeting; even though no monetary policy actions will be taken at the symposium, Fed Chair Powell is expected to speak on the state of the economy, inflation, etc. Analysts will be looking for signs whether Powell is leaning toward keeping the 5.25-5.50% Fed funds rate unchanged or crank it up another notch.
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Pre-Markets Green but Losing Steam; ANF, FL, KSS Report
Pre-market futures are modestly higher, with the exception of the small-cap Russell 2000, which is marginally down at this hour. Futures had been all nicely in the green earlier this morning, so we’re seeing a downward bias in the past hour or so. The Dow is +20 points currently (as opposed to +150 an hour ago), the Nasdaq +19 points, the S&P 500 +3 points and the Russell -1.3%.
Zacks Rank #1 (Strong Buy)-rated Abercrombie & Fitch (ANF - Free Report) posted a huge earnings beat in its Q2 this morning — $1.10 per share versus 13 cents expected — on revenues of $935.3 million in the quarter, well ahead of the $842.4 million in the Zacks consensus. Net sales grew +10%, easily surpassing the 2-4% analysts had been expecting. Flagship Abercrombie stores were up +23% year over year, +13% across all stores. This is the second-straight gigantic earnings beat in a row (the previous month’s beat was by +2050%!) and shares are trading up +15% in the early market.
Foot Locker (FL - Free Report) is on the other end of the spectrum this morning, with earnings of $0.04 per share on $1.86 billion in quarterly revenues — below the $0.05 per share and $1.88 billion estimated, respectively. Heavy promotional markdowns in the quarter brought overall comps -9.4%, while the the company is pausing its dividend yield and slashing full-year earnings guidance to $1.30-1.50 per share from $2.07 in the Zacks consensus. Expect downward revisions here, and the stock has fallen -30%v in today’s pre-market already.
Kohl’s (KSS - Free Report) managed to split the difference: earnings posted a big beat — 52 cents per share versus 24 cents expected — while revenues of $3.68 billion missed the $3.90 billion consensus estimate in the quarter. The company managed to reduce inventory by -14%, though these were not as low as analysts had expected. Yet shares are up +1% in today’s pre-market, following nearly +5% gains year to date (which still underperforms the S&P so far this year).
After the open today, S&P flash U.S. Manufacturing and Services PMI for July are coming out. Manufacturing is expected to slip a smidge further below 50-breakeven to 48.9% from 49.0% posted a month ago. Services look to remain nicely above the 50-mark, 52.5% expected versus 52.3% reported for June. We’ll also get New Home Sales for July, expected to climb to 703K for the month from 697K last posted. This follows yesterday’s Existing Home Sales which reached their lowest levels since January, -2.2% to 4.07 million seasonally adjusted, annualized units.
We also get reports out of Jackson Hole, WY beginning tomorrow from the annual Economic Symposium. These should serve, as per usual, as a proxy for the latest Fed meeting; even though no monetary policy actions will be taken at the symposium, Fed Chair Powell is expected to speak on the state of the economy, inflation, etc. Analysts will be looking for signs whether Powell is leaning toward keeping the 5.25-5.50% Fed funds rate unchanged or crank it up another notch.
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