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Morning Brief

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Morning Quant Ride

Jul 17, 2018

US Stocks

 

 

  • Global stocks are declining this morning ahead of US Federal Reserve Chairman Jerome Powell’s semi-annual Monetary Policy Report to US Senate Banking Committee
  • US stocks index futures are down with the Dow Jones minis -0.11%, S&P500 minis -0.09% and Nasdaq 100 minis -0.11%
  • Netflix (NFLX) is down 12.8% in pre-market trading after reporting 2Q earnings results which missed estimates for new subscriber growth
  • Goldman Sachs (GS) is down 1.05% in pre-market trading are reporting trading results that were in-line with expectations.
  • The VIX is currently at 13.11 after closing at 12.83 yesterday
  • Bank of America (BAC) July 20 OTM Calls, EEM July 20 & September 2018 OTM Puts, and SPY July 20 OTM Calls are the most heavily traded options contracts in the US pre-market
  • The yield on the US 10-year government bond is little changed at 2.855%
  • The USD$ Index (DXY) is little changed with the GBP£ (-0.20% to 1.3209) and JPY¥ (-0.22% to 112.54) selling off against the Greenback this morning

International Stocks

  • European stocks are declining this morning with the Euro Stoxx 600 -0.24%, FTSE 100 -0.15%, DAX -0.20%, and CAC 40 -0.34%
  • Gains in chemical stocks is being offset by a sell-off in telecom stocks in European markets
  • VSTOXX, the European stocks equivalent of the VIX, is at 13.6388 after closing at 13.0323 yesterday
  • Asian stocks finished their trading sessions mixed with the Nikkei 225 +0.44%, CSI 300 -0.65%, HSI -1.25% and Hang Seng China Enterprise -1.05%
  • Volume traded at major Asia exchanges was light, trending well below their 30-day averages
  • Global sovereign bonds are little changed this AM: 10-year yields on Eurozone country government debt down little less than 1 basis points
  • Aussie 10-year yields are +2.3 basis points to 2.655% following hawkish comments from the Reserve Bank of Australia (RBA)

Cryptos

  • Coinbase announced that it has received regulatory approval from the SEC and FINRA to list security tokens.  The company received permission to acquire Keystone Capital Group, Venovate Marketplace, and Digital Wealth which will permit Coinbase to act as a broker-dealer, alternative trading platform and a RIA
  • BitPay, a global cryptocurrency payment processor, has been approved to receive a BitLicense by NY State’s Department Financial Services.  NY-based companies will be allowed accept Bitcoin (BTC) and Bitcoin Cash (BCH) from users globally.  BitPay is the 8th company to receive a BitLicense from NY State’s Department Financial Services to go along with Square, Genesis Global Trading, bitFlyer USA, Coinbase, XRP II and Circle Internet Financial
  • SBI Holdings, a Japanese financial institution, has launched the first bank-backed cryptocurrency exchange.  Called VCTRADE, it is currently available for users ages 20 to 70.  At the moment, only Ripple (XRP), Bitcoin (BTC) and Bitcoin Cash (BCH) can be traded on the platform (in JPY pairs)

*Data in Price Return; Source: Stockdio

S&P 500 Sector Performance

*Data in Total Return as of Previous Day’s EOD, Source: Capital IQ.

Conviction Buy Laggards From Yesterday We Are Watching Today

Click name for Q-Factor rating and financial data.

Allison Transmission Holdings, Inc. - 9.76% off its 52wkH on 10/31/2017, reports earnings on 07/30/2018

Hilton Grand Vacations Inc. - 26.83% off its 52wkH on 03/14/2018, reports earnings on 08/01/2018

Ichor Holdings, Ltd. - 42.80% off its 52wkH on 10/20/2017, reports earnings on 08/07/2018

MCBC Holdings, Inc. - 9.79% off its 52wkH on 05/18/2018, reports earnings on 09/07/2018

Nanometrics Incorporated - 17.05% off its 52wkH on 06/06/2018, reports earnings on 07/31/2018

Versum Materials, Inc. - 13.55% off its 52wkH on 11/08/2017, reports earnings on 08/07/2018

Stocks Trending in the News

Click name for Q-Factor rating and financial data.

Goldman Sachs (GS) reported 2Q2018 EPS that was significantly higher than forecasted ($5.98 vs $4.58 expected) but posted equity sales and trading revenue that was short of the consensus ($1.89 billion vs $1.97 billion anticipated). Shares of Goldman Sachs are down 1.05% before the open

Johnson & Johnson (JNJ) reported 2Q2918 EPS that was higher than expected ($2.10 vs $2.07 projected) but provided FY2018 sales guidance that missed the consensus ($80.5bn - $81.30 bn vs $81.48 bn estimated). Johnson & Johnson stock is trading 0.43% lower to $124.15 before the open

Netflix Inc (NFLX) shares are trading 12.84% lower to $350.00 pre-market, after the company reported 2Q2018 revenue and subscriber growth that was below the consensus. Shares of Amazon (AMZN) are down 0.80% to $1807.89 before the open, as Netflix’s weak results has materially impacted FAANG stocks

Skandinaviska Enskilda Banken (OM:SEB A) shares are trading 4.29% higher to SEK88.94, after the company reported 2Q2018 net income that was higher than expected (SEK10.0 billion vs SEK8.72 billion projected)

Sunny Optical (SEHK:2382) fell 6.76% to HKD$142.00 in today’s trading, following a tweet from GMT Research, which expressed concern about the accuracy of Sunny’s financial statements

Swedish telecommunications firm Telia Co AB (OM:Telia) has acquired GET and TDC Norway for $2.6 billion, expanding the company’s TV and broadband services in Norway

UnitedHealth Group (UNH) reported 2Q2018 EPS that was higher than expected ($3.14 vs $3.04 projected) and 2Q2018 revenue that was in line with the consensus ($56.1 billion vs $56.1 billion estimated). However, shares of UnitedHealth are down 1.74% to $252.50 pre-market

Walmart (WMT) announced that it has chosen Microsoft (MSFT) to be its strategic cloud provider, in an attempt to “further accelerate Walmart’s digital transformation”. The agreement will span a 5-year term

Cryptocurrencies Today

*Source: Stockdio

Stock Movers

Conviction Buy Winners and Losers

On Mobile/Tablet scroll to the right

Winners  Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Louisiana-Pacific Corporation LPX Materials Forest Products 3.48% 3.36% 8.83%
Five Below, Inc. FIVE Consumer Discretionary Specialty Stores 2.04% 3.90% 55.96%
PulteGroup, Inc. PHM Consumer Discretionary Homebuilding 1.62% 2.52% -9.38%
The Boeing Company BA Industrials Aerospace and Defense 1.51% 4.55% 20.75%
Alleghany Corporation Y Financials Reinsurance 1.47% 1.11% 1.23%
Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Hilton Grand Vacations Inc. HGV Consumer Discretionary Hotels, Resorts and Cruise Lines -1.99% -0.99% 0.69%
FleetCor Technologies, Inc. FLT Information Technology Data Processing and Outsourced Services -1.84% -1.39% 2.63%
Church & Dwight Co., Inc. CHD Consumer Staples Household Products -1.83% 0.38% 3.22%
Zoetis Inc. ZTS Healthcare Pharmaceuticals -1.65% 0.09% -0.65%
Cintas Corporation CTAS Industrials Diversified Support Services -1.64% -0.55% 4.01%

Source: S&P Capital IQ

Conviction Short Winners and Losers

On Mobile/Tablet scroll to the right

Winners Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Editas Medicine, Inc. EDIT Healthcare Biotechnology -7.12% -7.37% -1.76%
Whiting Petroleum Corporation WLL Energy Oil and Gas Exploration and Production -5.92% -6.08% -6.33%
Chesapeake Energy Corporation CHK Energy Oil and Gas Exploration and Production -5.59% -4.85% -6.49%
Geron Corporation GERN Healthcare Biotechnology -4.97% -4.18% 0.29%
Acacia Communications, Inc. ACIA Information Technology Communications Equipment -4.93% -1.72% -3.13%
Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Zscaler, Inc. ZS Information Technology Systems Software 3.47% 5.11% 0.00%
Pivotal Software, Inc. PVTL Information Technology Application Software 2.59% 2.67% 0.00%
Carvana Co. CVNA Consumer Discretionary Automotive Retail 2.43% 2.73% 136.24%
Applied Optoelectronics, Inc. AAOI Information Technology Communications Equipment 1.86% 6.36% 28.69%
Exact Sciences Corporation EXAS Healthcare Biotechnology 1.41% 3.46% 23.07%

Source: S&P Capital IQ

Events Calendar

On Mobile/Tablet scroll to the right

Company Name Ticker Event Date Event Type Q-Factor Score
Comerica Incorporated CMA 7/17/2018 Earnings Release Date US Large-Cap: A
Omnicom Group Inc. OMC 7/17/2018 Earnings Release Date US Large-Cap: B, US Consumer Discretionary: B
UnitedHealth Group Incorporated UNH 7/17/2018 Earnings Release Date US Large-Cap: A
First Horizon National Corporation FHN 7/17/2018 Earnings Release Date US Large-Cap: C
The Goldman Sachs Group, Inc. GS 7/17/2018 Earnings Release Date US Large-Cap: C
Interactive Brokers Group, Inc. IBKR 7/17/2018 Earnings Release Date US Large-Cap: C
CSX Corporation CSX 7/17/2018 Earnings Release Date US Large-Cap: B, US Industrials: C
Hancock Whitney Corporation HBHC 7/17/2018 Earnings Release Date US Large-Cap: A
Fidelity National Financial, Inc. FNF 7/17/2018 Earnings Release Date US Large-Cap: C
Pinnacle Financial Partners, Inc. PNFP 7/17/2018 Earnings Release Date US Large-Cap: C
Mellanox Technologies, Ltd. MLNX 7/17/2018 Earnings Release Date US Large-Cap: C, US Information Technology: C
Wintrust Financial Corporation WTFC 7/17/2018 Earnings Release Date US Large-Cap: B
eBay Inc. EBAY 7/17/2018 Estimated Earnings Release Date US Large-Cap: C, US Information Technology: B
Kinder Morgan, Inc. KMI 7/17/2018 Estimated Earnings Release Date US Large-Cap: B
Umpqua Holdings Corporation UMPQ 7/17/2018 Earnings Release Date US Large-Cap: C
SL Green Realty Corp. SLG 7/17/2018 Earnings Release Date US Large-Cap: C
Morgan Stanley MS 7/18/2018 Earnings Release Date US Large-Cap: C
W.W. Grainger, Inc. GWW 7/18/2018 Earnings Release Date US Large-Cap: C, US Industrials: C
Textron Inc. TXT 7/18/2018 Earnings Release Date US Large-Cap: B, US Industrials: C
MGIC Investment Corporation MTG 7/18/2018 Earnings Release Date US Large-Cap: B
Abbott Laboratories ABT 7/18/2018 Earnings Release Date US Large-Cap: C
U.S. Bancorp USB 7/18/2018 Earnings Release Date US Large-Cap: B
M&T Bank Corporation MTB 7/18/2018 Earnings Release Date US Large-Cap: A
Northern Trust Corporation NTRS 7/18/2018 Earnings Release Date US Large-Cap: B
Texas Capital Bancshares, Inc. TCBI 7/18/2018 Earnings Release Date US Large-Cap: D
International Business Machines Corporation IBM 7/18/2018 Earnings Release Date US Large-Cap: C, US Information Technology: A
PTC Inc. PTC 7/18/2018 Earnings Release Date US Large-Cap: C, US Information Technology: C
Alcoa Corporation AA 7/18/2018 Earnings Release Date US Large-Cap: C
Crown Castle International Corp. (REIT) CCI 7/18/2018 Earnings Release Date US Large-Cap: D
United Rentals, Inc. URI 7/18/2018 Earnings Release Date US Large-Cap: B, US Industrials: A
Crown Holdings, Inc. CCK 7/18/2018 Earnings Release Date US Large-Cap: C
Vinda International Holdings Limited SEHK:3331 7/18/2018 Earnings Release Date China All-Cap: C
Alliance Data Systems Corporation ADS 7/18/2018 Estimated Earnings Release Date US Large-Cap: B, US Information Technology: A
Intuitive Surgical, Inc. ISRG 7/18/2018 Estimated Earnings Release Date US Large-Cap: B
Sarepta Therapeutics, Inc. SRPT 7/18/2018 Estimated Earnings Release Date US Large-Cap: D
T-Mobile US, Inc. TMUS 7/18/2018 Estimated Earnings Release Date US Large-Cap: B
Philip Morris International Inc. PM 7/18/2018 Earnings Release Date US Large-Cap: C, US Consumer Staples: C
Union Pacific Corporation UNP 7/18/2018 Earnings Release Date US Large-Cap: B, US Industrials: C

 

Source: S&P Capital IQ