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Boeing Mixed in Q1, TMO Beats; Durable Goods In-Line

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Wednesday, April 24th, 2024

Pre-market futures are mixed at this hour. Halfway through a week that looks determined to claw back some of the losses incurred over the previous couple weeks, the Dow is giving back -50 points, the S&P 500 is up +11 and the Nasdaq +113 points. Earnings season tells part of this story: while many non-tech firms on the blue-chip Dow have already reported, there is lots of anticipation regarding earnings reports to come from companies in the tech-heavy Nasdaq.

From the start of this week, the Dow is +1.29%. Bettering that output are the three other major indices: the S&P is up +2.22% from this weekend, and the Nasdaq is +3.00%. Even the previously troubled small-cap Russell 2000 is +2.44% from this past weekend. All this before the major Personal Consumption Expenditures (PCE) numbers are released Friday morning. And don’t look now, but next week is already Jobs Week once again.

Durable Goods Orders for March are out this morning. The headline number was in-line with consensus expectations for +2.6%, and more than triple the downwardly revised +0.7% the previous month. Today’s headline is the strongest monthly print since November of last year’s +5.4%. Ex-transportation (big-ticket orders like airplanes can skew these month-over-month numbers), this comes down to +0.2%, which is still higher than the previous month’s downwardly revised +0.1%.

And the revisions don’t stop there. In the non-Defense, ex-aircraft read — a proxy for “normal” business investment like computers and office furniture, etc. — we come way down to +0.2% last month. This is only half the downwardly revised +0.4% from February, and gives some insights into enterprise spending on durable goods (as opposed to households purchasing washers and dryers, for instance). Shipments came in-line with expectations at +0.2%, nicely up from the previous month’s unrevised -0.6%.

Speaking of big-ticket durable items, Boeing (BA - Free Report) is out with Q1 earnings. A better-than-expected bottom line loss per share of -$1.13 (from the -$1.43 per share anticipated) met with a top-line miss of $16.57 billion (from the $17.69 billion in the Zacks consensus). Airplane deliveries came down -36% year over year, largely on continued attention paid to its 737 fleet. Free cash burn and its Defense segment both reported to the upside of estimates. The biggest question for the plane-making giant is who will replace CEO David Calhoun as of the end of this year. Shares are up +3.6% in early trading, but -32% year to date.

Medical devices and services company Thermo Fisher (TMO - Free Report) beat expectations on both top and bottom lines for Q1 this morning. Earnings of $5.11 per share easily swept past the $4.70 projected, while $10.34 billion in quarterly revenues, while -3% year over year, outpaced estimates of $10.14 billion. Renewed guidance is basically in-line with previous estimates, while TMO upped its dividend yield +11% and repurchased $3.0 billion in shares during the quarter. Thermo Fisher is +2% in early trading.

After today’s close, Meta Platforms (META - Free Report) brings Q1 earnings results. Other companies of note reporting this afternoon are Ford (F - Free Report) , IBM (IBM - Free Report) and Chipotle (CMG - Free Report) , among others. This is a good illustration of how widespread Q1 earnings season has gotten, compared to mostly financial companies issuing reports in the first tranche of quarterly reports. Of these, only Meta has a positive Zacks Rank going into the print, at a Zacks Rank #2. The others are #3 at this hour, but this can change depending on the results.

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