After Hours Report

The S&P 500 (+0.3%), Nasdaq Composite (+0.7%), and Dow Jones Industrial Average (+0.3%) added to their strong weekly gains and closed at fresh record highs on Thursday. The small-cap Russell 2000 (-0.3%) struggled to keep pace and closed lower. 

The lead news item today was China announcing it will cut tariffs on $75 billion of U.S. imports by 50% on Feb. 14. This should not only help Beijing fulfill its pledges from the Phase One trade deal, but also provide additional economic stimulus. In the U.S., weekly jobless claims falling to their lowest level in nine months was another good sign for the economy.

Mega-cap technology stocks did the heavy lifting today, helping the S&P 500 communication services (+1.1%) and information technology (+0.9%) sectors outpace the broader market. The S&P 500, however, drifted with modest gains throughout the session, as investors presumably exercised some caution after a big week with the January employment report still due tomorrow. 

The energy sector (-1.0%) was today's outright laggard after a rare outperformance yesterday. 

Earnings were mixed and, keeping with recent trend, reactions were isolated to reporting companies. Twitter (TWTR 38.41, +5.02, +15.0%) and Cardinal Health (CAH 58.26, +5.58, +10.6%) stood out with impressive post-earnings gains, while Becton Dickinson (BDX 252.25, -33.74, -11.8%) and Kellogg (K 63.46, -5.90, -8.5%) were some of the laggards. 

Separately, Boeing (BA 341.43, +11.88, +3.6%) shares outperformed on reports that the FAA will approve the company's design fixes to the 737 MAX. New software flaws were discovered but the goal to return to service by mid-year remained intact, according to Bloomberg.

U.S. Treasuries finished a quiet session little changed. The 2-yr yield was unchanged at 1.45%, and the 10-yr yield declined one basis point to 1.64%. The U.S. Dollar Index increased 0.2% to 98.49. WTI crude increased 0.2% to $50.97/bbl. 

Reviewing Thursday's economic data:

• Initial claims for the week ending February 1 decreased by 15,000 to 202,000 (Briefing.com consensus 218,000), which is a nine-month low. Continuing claims for the week ending January 25 increased by 48,000 to 1.751 million.
  • The key takeaway from the report is that the low level of initial claims, which are a leading indicator, is indicative of employers maintaining a positive view of the demand outlook.
• The BLS reported that nonfarm business sector labor productivity increased 1.4% in the fourth quarter (Briefing.com consensus 1.7%). Unit labor costs were also up 1.4% (Briefing.com consensus 1.2%).
  • The key takeaway from the report is that productivity is still running below the long-term average from 1947 to 2019 (2.1%); however, the 1.7% growth in nonfarm business sector productivity in 2019 was the strongest since 2010 and above the 1.3% average for the period 2007-2019.

Looking ahead, investors will receive the Employment Situation Report for January, the Wholesale Inventories report for December, and the Consumer Credit report for December on Friday.

• Nasdaq Composite +6.7% YTD
• S&P 500 +3.6% YTD
• Dow Jones Industrial Average +3.0% YTD
• Russell 2000 +0.5% YT

Overseas: 

• Europe: DAX +0.7%, FTSE +0.3%, CAC +0.9%
• Asia: Nikkei +1.7%, Hang Seng +2.6%, Shanghai +1.7%

Commodities: 

• Crude Oil +0.15 @ 50.89
• Nat Gas +0.01 @ 1.87
• Gold +6.80 @ 1564.40
• Silver +0.21 @ 17.83
• Copper +0.01 @ 2.59

• Russia rejects request from Saudi Arabia to further cut oil production amid coronavirus outbreak, according to The Wall Street Journal
• 2U (TWOU) beats by $0.04, beats on revs; guides Q1 revs in-line; guides FY20 revs in-line... TWOU up 9.1% after hours
• Activision Blizzard (ATVI) beats by $0.32, beats on revs; guides Q1 below consensus; guides FY20 EPS just above consensus, revs just below consensus... ATVI up 2.5% after hours
• Aurora Cannabis (ACB) confirms CEO Booth steps down; appoints Chairman Michael Singer interim CEO; adds independent Board members; announces restructuring, preannounces soft Q2 results... ACB down 12.6% after hours
• Bill.com (BILL) beats by $0.02, beats on revs... BILL up 7.2% after hours
• Columbia Sportswear (COLM) misses by $0.08, reports revs in-line; guides FY20 EPS below consensus, revs in-line... COLM down 3.4% after hours
• FleetCor (FLT) beats by $0.03, reports revs slightly below consensus; guides Q1 EPS below consensus; guides FY20 EPS in-line, revs in-line... FLT down 5.2% after hours
• Forward Air (FWRD) misses by $0.07, reports revs in-line; guides Q1 EPS below consensus, revs above consensus... FWRD down 3.6% after hours
• IntercontinentalExchange (ICE) states that it will no longer explore opportunities with eBay (EBAY)... ICE up 2.9% after hours
• Manitowoc (MTW) beats by $0.06, misses on revs; guides FY20 revs below consensus... MTW down 12.2% after hours
• Motorola Solutions (MSI) beats by $0.14, reports revs in-line; guides Q1 EPS below consensus, revs below consensus; guides FY20 EPS above consensus, revs below consensus... MSI up 0.6% after hours
• Myriad Genetics (MYGN) misses by $0.06, misses on revs; guides MarQ EPS and revs below consensus; guides FY20 EPS and revs below consensus; prenatal business fell short; CEO Mark Capone resigns... MYGN down 30.4% after hours
• News Corp. (NWSA) beats by $0.03, misses on revs; declares semi-annual dividend... NWSA up 0.6% after hours
• NortonLifeLock (NLOK) beats by $0.17, beats on revs; guides Q4 EPS above consensus, revs below consensus... NLOK up 5.9% after hours
• Pinterest (PINS) beats by $0.04, beats on revs; guides FY20 revs above consensus... PINS up 16.7% after hours
• Skechers USA (SKX) beats by $0.01, beats on revs; guides Q1 EPS below consensus, revs in-line... SKX up 13% after hours
• Synaptics (SYNA) beats by $0.59, beats on revs; guides MarQ revs above consensus... SYNA up 15% after hours
• Take-Two (TTWO) misses on GAAP EPS by $0.09, reports revs in-line; guides Q4 GAAP EPS below consensus, revs above consensus... TTWO down 8.7% after hours
• Teradata (TDC) beats by $0.06, beats on revs; guides Q1 EPS below consensus; guides FY20 EPS below consensus... TDC down 9.0% after hours
• T-Mobile US (TMUS) beats by $0.03, reports revs in-line... TMUS up 0.5% after hours
• Twist Bioscience (TWST) misses by $0.86, beats on revs; guides FY20 revs in-line... TWST down 6.0% after hours
• Uber (UBER) beats by $0.04, reports revs in-line; Uber on call guides FY20 EBITDA above consensus... UBER up 4.9% after hours
• Verizon (VZ) authorizes new repurchase program for up to 100 mln shares of its common stock... VZ up 0.9% after hours
• ViaSat (VSAT) beats by $0.11, reports revs in-line... VSAT up 3.0% after hours
• Wynn Resorts (WYNN) reports Q4 (Dec) results, misses on revs... WYNN down 0.1% after hours

Fair Value for Friday, February 7:

• S&P 500: 3344
• Nasdaq 100: 9453
• DJIA: 29317

Today's News Summary:

For a full rundown of today's market and after hours developments, see Live In Play

• Earnings/Guidance (Full Earnings Calendar):
  • ADTRAN (ADTN) beats by $0.05, beats on revs
  • AGCO Corp (AGCO) misses by $0.61, misses on revs; guides FY20 EPS below consensus, revs below consensus
  • AMERCO (UHAL) misses by $2.31, reports revs in-line
  • ANGI Homeservices (ANGI) misses by $0.07, misses on revs, guides FY20 adjusted EBITDA in-line
  • ArcelorMittal (MT) reports Q4 (Dec) results, misses on revs
  • Arch Coal (ARCH) reports Q4 (Dec) results, beats on revs
  • Arrow Elec (ARW) beats by $0.03, reports revs in-line; guides Q1 EPS below consensus, revs in-line
  • Ball Corp (BLL) beats by $0.04, misses on revs
  • Becton Dickinson (BDX) beats by $0.01, reports revs in-line; guides FY20 EPS below consensus
  • Bristol-Myers (BMY) reports Q4 results; guides FY20 EPS in-line, revs in-line; announces increase of $5 bln to share repurchase program
  • Cabot Micro (CCMP) beats by $0.31, reports revs in-line; guides Q2 revs above consensus
  • Cardinal Health (CAH) beats by $0.30, beats on revs; guides FY20 EPS above consensus
  • CDW (CDW) beats by $0.09, beats on revs
  • Central Garden (CENT) beats by $0.04, beats on revs
  • CIGNA (CI) beats by $0.11, beats on revs; guides FY20 EPS midpoint below consensus, revs above consensus
  • Cincinnati Fincl (CINF) beats by $0.12, beats on revs
  • Cognizant Tech (CTSH) beats by $0.03, beats on revs; guides Q1 revs above consensus; guides FY20 EPS below consensus, revs in-line
  • Coherent (COHR) beats by $0.09, beats on revs
  • Costco (COST) reports net sales of $11.57 bln for the retail month of January
  • Dunkin (DNKN) beats by $0.03, reports revs in-line; guides FY20 EPS below consensus
  • e.l.f. Beauty (ELF) beats by $0.09, beats on revs; guides FY20 EPS above consensus, revs above consensus
  • Estee Lauder (EL) beats by $0.21, beats on revs; guides FY20 EPS below consensus, revs in-line
  • Fiat Chrysler (FCAU) beats by $0.02, beats on revs; guides FY20 EPS above consensus
  • FireEye (FEYE) beats by $0.03, beats on revs; guides Q1 EPS below consensus, revs in-line; guides FY20 EPS above consensus, revs in-line
  • FormFactor (FORM) beats by $0.10, beats on revs; guides Q1 EPS above consensus, revs above consensus
  • Fox Corporation (FOXA) beats by $0.11, beats on revs
  • Funko (FNKO) reports downside prelim Q4 results and issues prelim 2020 guidance
  • GlaxoSmithKline (GSK) reports EPS in-line, revs in-line; guides FY20 EPS in-line; announces it will split into two companies
  • Glu Mobile (GLUU) misses by $0.01, beats on revs; guides Q1 revs below consensus; guides FY20 revs below consensus
  • GoPro (GPRO) misses by $0.09, misses on revs; CFO McGee adds COO role
  • GrubHub (GRUB) misses by $0.02, beats on revs; guides Q1 revs in-line, but Q1 EBITDA guidance is light; guides FY20 revs in-line
  • Hain Celestial (HAIN) beats by $0.01, reports revs in-line; raises FY20 EPS
  • IntercontinentalExchange (ICE) reports EPS in-line, revs in-line
  • InterActiveCorp (IAC) reports Q4 (Dec) results, revs in-line
  • iRobot (IRBT) beats by $0.29 on GAAP EPS, beats on revs; guides FY20 GAAP EPS in-line, revs in-line; announces CFO transition
  • Kellogg (K) beats by $0.05, beats on revs
  • Meredith (MDP) misses by $0.52, beats on revs; reaffirms FY20 EPS guidance, revs guidance
  • MetLife (MET) beats by $0.60, beats on revs
  • Moelis (MC) beats by $0.12, beats on revs
  • Monolithic Power (MPWR) beats by $0.01, beats on revs; guides Q1 revs above consensus
  • NETGEAR (NTGR) beats by $0.05, beats on revs; guides Q1 revs below consensus
  • New York Times (NYT) beats by $0.14, reports revs in-line; increases dividend
  • Nokia (NOK) beats by €0.02, beats on revs; guides FY20 EPS in-line
  • Nuance Communications (NUAN) beats by $0.03, beats on revs
  • O'Reilly Auto (ORLY) misses by $0.02, reports revs in-line; guides Q1 EPS below consensus; guides FY20 EPS below consensus, revs in-line
  • Patterson-UTI (PTEN) misses by $0.02, beats on revs; expects to spend ~$250 million of capex for the year, down from $348 million in 2019
  • Paycom Software (PAYC) beats by $0.09, beats on revs; guides Q1 revs below consensus; guides FY20 revs above consensus
  • Peloton (PTON) beats by $0.11, beats on revs; guides Q3 revs below consensus; guides FY20 revs above consensus
  • Penn Natl Gaming (PENN) misses by $1.15, reports revs in-line
  • Philip Morris International (PM) beats by $0.01, reports revs in-line; guides FY20 EPS below consensus
  • Qualcomm (QCOM) beats by $0.13, beats on revs; guides Q2 EPS and revs in-line
  • Regeneron Pharma (REGN) beats by $0.59, beats on revs; will provide financial guidance for full year 2020 by the end of the first quarter of 2020
  • Royal Gold (RGLD) misses by $0.04, misses on revs
  • Sally Beauty (SBH) misses by $0.09, misses on revs; lowers FY20 EPS guidance, reaffirms FY20 revs guidance
  • Sanofi (SNY) beats by $0.06, reports revs in-line; guides FY20 EPS above consensus
  • Snap-On (SNA) reports EPS in-line, misses on revs
  • Sonos (SONO) beats by $0.02, beats on revs; reaffirms FY20 guidance
  • Spirit Airlines (SAVE) beats by $0.04, reports revs in-line
  • Suncor Energy (SU) misses by CAD0.10, beats on revs
  • Tapestry (TPR) beats by $0.11, reports revs in-line; lowers FY20 EPS and revenue guidance due to estimated negative impact of the coronavirus outbreak in China
  • Total S.A. (TOT) beats $0.07; misses on revs
  • Toyota Motor (TM) reports Q3 results
  • TrueBlue (TBI) misses by $0.02, misses on revs; guides Q1 EPS below consensus, revs in-line
  • TTM Tech (TTMI) beats by $0.14, beats on revs; guides Q1 EPS below consensus, revs in-line
  • Twilio (TWLO) beats by $0.03, beats on revs; guides Q1 EPS below consensus, revs above consensus; guides FY20 EPS below consensus, revs above consensus
  • Twitter (TWTR) misses by $0.02, beats on revs; guides Q1 revs in-line, profit below
  • Tyson Foods (TSN) misses by $0.01, misses on revs
  • U.S. Xpress (USX) beats by $0.04, beats on revs
  • Werner Enterprises (WERN) beats by $0.07, misses on revs
  • Willis Towers Watson (WLTW) beats by $0.04, beats on revs
  • World Wrestling (WWE) beats by $0.04, misses on revs, guides to Q1 adjusted OIBDA of $60-65 mln; pushes back long term strategy perspective to the end of Q1
  • Yum! Brands (YUM) misses by $0.13, beats on revs
  • Yum China (YUMC) beats by $0.08, reports revs in-line; Coronavirus likely to have a materially adverse impact on Q1 and 2020 results
  • Xylem (XYL) misses by $0.01, reports revs in-line; guides FY20 EPS below consensus
  • Zynga (ZNGA) misses by $0.06, beats on revs; guides Q1 revs above consensus; guides FY20 revs below consensus
• General News:
  • China to cut tariffs by 50% on $75 bln in US goods as part of phase one trade deal
  • With 97% of the Iowa vote reporting Senator Bernie Sanders (I-VT) has pulled into a virtual tie with Pete Buttigieg in the state delegate count: Mr. Buttigieg has 26.2%, Mr. Sanders has 26.1%
  • Senate votes to acquit President Trump on abuse of power and obstruction of congress charges
  • Death toll from the coronavirus has topped 560, according to Bloomberg
  • UK aiming to implement global tariffs beginning in 2021, according to Reuters
  • OPEC+ panel to recommend further 600,000 bpd output cut, according to CNBC
  • FCC summary of Repurposing Mid-Band Spectrum for 5G; accelerated payments could total up to $9.7 billion and would be paid by winning bidders in the C-band auction
  • Amazon (AMZN) mulling sale of Twitch streaming technology, according to The Information
  • Anheuser-Busch InBev (BUD) announces that Felipe Dutra, Chief Financial and Technology Officer, will step down
  • Nikkei reporting that Apple's (AAPL) 45 mln order for AirPods at risk due to Coronavirus
  • Aurora Cannabis (ACB) aims to eliminate 10% of its staff, according to Bloomberg
  • Bloomberg reports that Boeing (BA) has discovered additional software flaws in 737 Max, but goal to return to service by mid-2020 still remains
  • Melco Resorts & Entertainment (MLCO) has taken the decision to reassess all non-core investments to be made in 2020
  • Wall Street Journal reports that Elliott Management has amassed a nearly $2.5 billion stake in Softbank (SFTBY)
  • Under Armour (UA) appoints Colin Browne as COO, effective February 17
  • Verizon (VZ): Huawei Technologies files lawsuit against Verizon over patients, according to the Wall Street Journal

• Upgrades:
  • Cogent Communications (CCOI) upgraded to Buy from Neutral at Goldman; tgt raised to $84
  • Cummins (CMI) upgraded to Neutral from Sell at UBS; tgt raised to $167
  • Eaton (ETN) upgraded to Buy from Hold at Vertical Research
  • FirstService (FSV) upgraded to Outperform from Mkt Perform at Raymond James; tgt $120
  • General Dynamics (GD) upgraded to Overweight from Neutral at JP Morgan; tgt raised to $225
  • Micron (MU) upgraded to Strong Buy from Mkt Perform at Raymond James; tgt $70
  • nVent Electric (NVT) upgraded to Overweight from Equal Weight at Barclays; tgt $32
  • Plains All American (PAA) upgraded to Buy from Neutral at Goldman; tgt $19
  • Plains GP (PAGP) upgraded to Buy from Neutral at Goldman; tgt $19
  • VMware (VMW) upgraded to Outperform from Mkt Perform at Bernstein; tgt raised to $181
• Downgrades:
  • Carlyle Group (CG) downgraded to Mkt Perform from Outperform at Keefe Bruyette; tgt lowered to $35
  • Carlyle Group (CG) downgraded to Neutral from Buy at Citigroup; tgt lowered to $35
  • FormFactor (FORM) downgraded to Hold from Buy at Stifel; tgt $27
  • Funko (FNKO) downgraded to Hold from Buy at Jefferies; tgt lowered to $11
  • Funko (FNKO) downgraded to Neutral from Buy at DA Davidson; tgt lowered to $11
  • Funko (FNKO) downgraded to Underperform from Buy at BofA/Merrill; tgt lowered to $10
  • Funko (FNKO) downgraded to Underweight from Overweight at JP Morgan; tgt lowered to $9.50
  • Gilead Sciences (GILD) downgraded to Mkt Perform from Outperform at Bernstein; tgt lowered to $70
  • Ingenico (INGIY) downgraded to Hold from Buy at Berenberg
  • KC Southern (KSU) downgraded to Market Perform from Outperform at BMO Capital Markets; tgt $175
  • Perspecta (PRSP) downgraded to Equal Weight from Overweight at Wells Fargo; tgt lowered to $26
  • Phibro Animal Health (PAHC) downgraded to Hold from Buy at Gabelli & Co; tgt $30
  • Walker & Dunlop (WD) downgraded to Neutral from Buy at Compass Point; tgt $70
  • Yum China (YUMC) downgraded to Neutral from Outperform at Daiwa Securities
• Others:
  • BioLife Solutions (BLFS) initiated with a Buy at B. Riley FBR; tgt $27
  • Dell (DELL) initiated with a Sector Perform at RBC Capital Mkts; tgt $56
  • Newmont Goldcorp (NEM) initiated with a Neutral at UBS; tgt $46
  • SunCoke Energy (SXC) initiated with a Hold at The Benchmark Company

Upcoming Events:

• Econ Data (Friday):
  • 08:30 ET: January Nonfarm Payrolls (Briefing.com consensus 164,000; prior 145,000), Nonfarm Private Payrolls (Briefing.com consensus 155,000; prior 139,000), Average Hourly Earnings (Briefing.com consensus 0.3%; prior 0.1%), Unemployment Rate (Briefing.com consensus 3.5%; prior 3.5%), and Average Workweek (Briefing.com consensus 34.3; prior 34.3)
  • 10:00 ET: December Wholesale Inventories (Briefing.com consensus -0.1%; prior -0.1%)
  • 15:00 ET: December Consumer Credit (Briefing.com consensus $17.50 bln; prior $12.50 bln)
• Earnings:
  • Monday (February 3)
    • Pre-Market: ACM AMG ABG CTLT CHKP NSSC ON SASIA SYY
    • After-Hours: ARE GOOG AFG BECN CBT EZPW FN HLIT HIG HP HXL HLI KMT KRC LEG MTSC NXPI PAHC PCH RBC SSD SXI VVV WWD
  • Tuesday (February 4)
    • Pre-Market:  ATI AXE ARMK ATKR BDC TECH BP CNC CLX CMCO COP CSWI CTS CMI EXP ETN EMR ENTG AQUA IT HAE HLNE HUBB JHG LHX LANC LII LITE MCK MTG MSGN PBI PINC RL ROLL RCL SPG SIRI SNE TDG VSH GRA WDR WAT ZBH
    • After-Hours: EGHT ATGE AFL ALL DOX AINV APAM ATO BOOT CDK CERN CMG CB TCS CCK ESE ETH FISV F GTES GNW GILD GL THG HIW IPHI JKHY KLAC KN MANH MTCH MDU MCHP MODN MWA NBIX NEWR OI OLN PCTY CNXN PDM PAA PAGP PLT PWL PRU QGEN RRR RNR SCSC STX SNAP SWI TENB UNM USNA VIAV DIS YRCW ZAYO
  • Wednesday (February 5)
    • Pre-Market:  ABB AME BMI BSX CPRI CG COTY DTE ENR FSV GM GPI HUM KFRC MHO MCFT MRK NS NVT BTU PAG PFGC SR SPOT SUM TMHC TKR UMC WD
    • After-Hours:  ADTN AOSL UHAL ANGI AVB ACLS CCMP CENT CDAY CINF CTSH COHR CUZ CSGS CUB DHT ECHO ENS FEYE FLO FMC FORM FOXA GLUU GPRO GRUB HI ICHR IAC IRBT LCI LNC RAMP MTRX MXL MET MC MPWR NTGR NUAN ORLY OHI PAYC PTON QCOM QNST RDN RYN RGLD SONO SAVE SU TBI TTMI TWLO TWO UGI WERN YUMC ZNGA
  • Thursday (February 6)
    • Pre-Market:  ABMD WMS AGCO ALNY MT ARCH ARW BLL BCE BDX BGCP BV BCO BMY CAH CDW CI COR DNKN EIGI EL FCAU GLOP GLT EAF HAIN ICE K KEM MAC MMS MPW MDP NRX NYT NGL NJR ODFL PTEN PENN PM PBH PRLB REGN SPGI SNY SNA TPR TGI TWTR TSN USX VSTO WLTW WWE XYL YUM
    • After-Hours: TWOU ATVI ASYS BIDU BHE BILL BKH BRKS CSL CCS COLM OFC DLX DXC EGP EGAN ENTA EHC EXPO FLT FSCT FTNT FTV FWRD G HUBG IQ LMAT LGND LFG.A MTW MTD MOBL MSI MYGN NOV NTUS UEPS NWSA NLOK OMCL ONTO PMT PINS POST PRO SGEN SIMO SKX SYNA TTWO TDC TSE UBER VRSN VVI VSAT VRTU VCRA WYNN ZEN
  • Friday (February 7)
    • Pre-Market: ABBV AVTR CAE CCJ CBOE CNHI ROAD UFS FE GRC HMC
    • After-Hours: None of note
    • Full Earnings Calendar