Morning Quant Ride

May 24, 2018

US Stocks

  • A statement from the US government that it is exploring the possibility of tariffs on auto imports is spooking global markets this morning
  • US equity index futures are declining this AM with Dow Jones minis -0.12%, S&P500 minis -0.07% and Nasdaq 100 minis -0.01%
  • USD$ Index is negative this AM with a strengthening EUR€ +.016%, GBP£ +0.35%, CHf +0.52% and JPY¥ +0.40%
  • Oil is selling off this morning with WTI -1.31% (USD$70.98/bbl) and Brent -1.43% (USD$78.69/bbl)
  • WTI continues to hold above USD$70/barrel
  • Risk-off feel this AM with Gold spot +0.19% (USD$1296.22/oz) and Silver spot +0.43% (USD$16.53/oz)
  • US government bonds are little changed this morning with the yield on the US 10-year is sitting at 2.9936

International Stocks

  • European stocks are mixed this morning with the Euro Stoxx 600 +0.28%, FTSE 100 -0.09%, CAC 40 +0.40% and DAX -0.08%
  • European auto stocks are down following a statement by the US government that it is exploring the possibility of instituting tariffs on imported cars
  • Spanish and Italian 10-year government bonds are rallying this morning with the Spanish 10-year yield +5.2 basis points to 1.379% and the Italian 10-year yield +3.9 basis points to 2.351%, for reference the Germany 10-year yield is at 0.498%
  • Asian stocks finished their trading sessions mixed with the Nikkei 225 -1.11%, Hang Seng +0.31%, Hang Seng China Enterprise +0.51%
  • Japanese stocks were weighed down my mega-cap auto manufacturers like Toyota and Honda which closed negative on worries about the potential for tariffs on their US exports
  • Coal and E&P stocks led the positive move in Hong Kong
  • Hong Kong 10-year sovereigns are rallying this morning with the yield down 6.3 basis points to 2.157%
  • Yields on Aussie 10-year sovereigns are +3.4 basis points to 2.802%

Cryptos

  • The US Department of Justice has reportedly launched a criminal investigation into cryptocurrency traders who may have manipulated the market with old-school illicit tactics, such as spoofing. The investigation is also being conducted with the Commodity and Futures Trading Commission (CFTC)
  • American Express is exploring using blockchain technology to increase security for both users and merchants. Also, a hyperledger blockchain technology may be developed to allow merchants to create their own rewards programs that are tailor-made for individual cardholders
  • Revolut, a British based company that created the first app to allow customers to invest in Bitcoin, has announced it will be adding Ripple (XRP) and Bitcoin Cash (BCH) to its platform. Revolut began as an app allowing users to transfer fiat currencies, but now has four cryptocurrencies on its platform

*Data in Price Return

 

S&P 500 Sector Performance

*Data in Total Return 

 

Conviction Buy Laggards From Yesterday We Are Watching Today

Click name for Q-Factor rating and financial data.

Allison Transmission Holdings, Inc. - 5.43% off its 52wkH on 10/31/2017, reports earnings on 07/27/2018

Berkshire Hathaway Inc. - 9.96% off its 52wkH on 01/29/2018, reports earnings on 08/03/2018

CVS Health Corporation - 21.94% off its 52wkH on 09/19/2017, reports earnings on 08/08/2018

Gentex Corporation - 2.85% off its 52wkH on 04/17/2018, reports earnings on 07/20/2018

Hilton Grand Vacations Inc. - 16.63% off its 52wkH on 03/14/2018, reports earnings on 08/01/2018

SMART Global Holdings, Inc. - 20.46% off its 52wkH on 01/00/1900, reports earnings on 06/19/2018

 

Stocks Trending in the News

Click name for Q-Factor rating and financial data.

Apple Inc (AAPL) has signed a deal with Volkswagen AG (VOW.GR) to convert more than two-dozen Volkswagen’s T6 Transport vehicles into self-driving shuttles.

Best Buy Co (BBY) shares are advancing by 1.58% pre-market after reporting 1Q2018 EPS that was firmly above projections ($0.82 vs $0.75 forecasted).

Deere & Co’s (DE) stock is up 1.80% before the open after UBS upgraded Deere from a neutral rating to a buy. UBS sites rising grain prices as a possible catalyst for accelerating sales in agricultural equipment over the next year.

Deutsche Bank (DB:DBK) will be reducing its equity trading unit by 25%, and will be cutting a minimum of 7,000 jobs overall in a cost cutting effort.

General Electric (GE) CEO John Flattery remarked yesterday that the company may not be able to guarantee it’s 2019 dividend, and that the company will have to see how turnaround efforts “play out” over the next year.

Hormel Foods (HRL) reported 2Q2018 EPS of $0.44, which was slightly below expectations ($0.45 projected). Hormel shares are down 0.56% pre-market.

McKesson (MCK) posted 4Q2017 EPS that was softer than forecasted ($3.49 vs $3.56 estimated).

Medtronic (MDT) announced 4Q2017 EPS that was above consensus ($1.42 vs $1.39 anticipated).

Vaalco Energy (EGY) shares are trading 3.77% higher this morning, as rising Brent oil prices have provided the company with enough cash flow to pay off its outstanding debt for the first time since 2014.

Vodafone Group Plc (LSE:VOD) has reportedly sold $11.5 billion in bonds to finance its acquisition of Liberty Global Plc (LBTYA).

Cryptocurrencies Today

 

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
Lowe's Companies, Inc. LOW Consumer Discretionary Home Improvement Retail 10.43% 9.67% 1.88%
PVH Corp. PVH Consumer Discretionary Apparel, Accessories and Luxury Goods 2.21% 1.89% 15.18%
Facebook, Inc. FB Information Technology Internet Software and Services 1.69% 2.31% 5.92%
Micron Technology, Inc. MU Information Technology Semiconductors 1.59% 12.32% 45.84%
CDW Corporation CDW Information Technology Technology Distributors 1.49% 1.80% 15.37%

 

Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
Ollie's Bargain Outlet Holdings, Inc. OLLI Consumer Discretionary General Merchandise Stores -2.89% -1.57% 10.77%
Allison Transmission Holdings, Inc. ALSN Industrials Construction Machinery and Heavy Trucks -1.77% 0.07% 10.82%
Nordson Corporation NDSN Industrials Industrial Machinery -1.74% -5.90% -1.24%
M&T Bank Corporation MTB Financials Regional Banks -1.70% -0.59% -0.83%
Affiliated Managers Group, Inc. AMG Financials Asset Management and Custody Banks -1.34% -1.49% 0.06%

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
Camping World Holdings, Inc. CWH Consumer Discretionary Automotive Retail -10.00% -12.37% -32.69%
nLIGHT, Inc. LASR Information Technology Electronic Equipment and Instruments -5.55% -0.13% 18.92%
Sage Therapeutics, Inc. SAGE Healthcare Biotechnology -5.16% -5.10% 8.32%
AnaptysBio, Inc. ANAB Healthcare Biotechnology -4.90% -6.38% -12.58%
Blueprint Medicines Corporation BPMC Healthcare Biotechnology -4.04% -1.69% 5.16%

 

Losers Ticker Sector Industry 1 Day Return 5 Day Return  YTD
DocuSign, Inc. DOCU Information Technology Internet Software and Services 5.51% 1.43% 0.00%
Spark Therapeutics, Inc. ONCE Healthcare Biotechnology 4.50% 1.94% 52.08%
Immunomedics, Inc. IMMU Healthcare Biotechnology 4.25% 7.53% 39.67%
CyrusOne Inc. CONE Real Estate Specialized REITs 3.02% 2.03% -10.63%
New Relic, Inc. NEWR Information Technology Internet Software and Services 2.51% 2.00% 67.08%

Source: S&P Capital IQ

 

Events Calendar

On Mobile/Tablet scroll to the right. 

Company Name Ticker Event Date Event Type Q-Factor Score
McKesson Corporation MCK 5/24/2018 Earnings Release Date US Large-Cap: D
58.com Inc. WUBA 5/24/2018 Earnings Release Date China All-Cap: B
Hormel Foods Corporation HRL 5/24/2018 Earnings Release Date US Large-Cap: C, US Consumer Staples: B
The Toro Company TTC 5/24/2018 Earnings Release Date US Large-Cap: B, US Industrials: C
Ross Stores, Inc. ROST 5/24/2018 Earnings Release Date US Large-Cap: B, US Consumer Discretionary: A
Splunk Inc. SPLK 5/24/2018 Earnings Release Date US Large-Cap: D, US Information Technology: D
Veeva Systems Inc. VEEV 5/24/2018 Earnings Release Date US Large-Cap: C
Nutanix, Inc. NTNX 5/24/2018 Earnings Release Date US Large-Cap: F, US Information Technology: D
The Gap, Inc. GPS 5/24/2018 Earnings Release Date US Large-Cap: C, US Consumer Discretionary: B
DXC Technology Company DXC 5/24/2018 Earnings Release Date US Large-Cap: B, US Information Technology: A
Yirendai Ltd. YRD 5/24/2018 Estimated Earnings Release Date China All-Cap: C
Sinotrans Shipping Limited SEHK:368 5/24/2018 Estimated Earnings Release Date China All-Cap: C
Road King Infrastructure Limited SEHK:1098 5/24/2018 Estimated Earnings Release Date China All-Cap: B
MMG Limited SEHK:1208 5/24/2018 Estimated Earnings Release Date China All-Cap: B
Yuexiu Property Company Limited SEHK:123 5/24/2018 Estimated Earnings Release Date China All-Cap: B
Swire Properties Limited SEHK:1972 5/24/2018 Estimated Earnings Release Date China All-Cap: C
Beijing Capital Land Ltd. SEHK:2868 5/24/2018 Estimated Earnings Release Date China All-Cap: D
ChinaCache International Holdings Ltd. CCIH 5/24/2018 Estimated Earnings Release Date China All-Cap: D
Fang Holdings Limited SFUN 5/24/2018 Estimated Earnings Release Date China All-Cap: C
Burlington Stores, Inc. BURL 5/24/2018 Estimated Earnings Release Date US Large-Cap: B, US Consumer Discretionary: A
Bitauto Holdings Limited BITA 5/24/2018 Estimated Earnings Release Date China All-Cap: F
JA Solar Holdings Co., Ltd. JASO 5/24/2018 Estimated Earnings Release Date China All-Cap: C
CSPC Pharmaceutical Group Limited SEHK:1093 5/24/2018 Earnings Release Date China All-Cap: A
Big Lots, Inc. BIG 5/24/2018 Estimated Earnings Release Date US Large-Cap: C, US Consumer Discretionary: C
Brilliance China Automotive Holdings Limited SEHK:1114 5/24/2018 Estimated Earnings Release Date China All-Cap: D
Enterprise Development Holdings Limited SEHK:1808 5/24/2018 Estimated Earnings Release Date China All-Cap: F
AVIC International Holding (HK) Limited SEHK:232 5/24/2018 Estimated Earnings Release Date China All-Cap: F
China Power International Development Limited SEHK:2380 5/24/2018 Estimated Earnings Release Date China All-Cap: C
ENN Energy Holdings Limited SEHK:2688 5/24/2018 Estimated Earnings Release Date China All-Cap: B
IGG Inc SEHK:799 5/24/2018 Estimated Earnings Release Date China All-Cap: B
Sinopec Kantons Holdings Limited SEHK:934 5/24/2018 Estimated Earnings Release Date China All-Cap: D
LVGEM (China) Real Estate Investment Company Limited SEHK:95 5/24/2018 Estimated Earnings Release Date China All-Cap: B
China Taiping Insurance Holdings Company Limited SEHK:966 5/24/2018 Estimated Earnings Release Date China All-Cap: C
eHi Car Services Limited EHIC 5/24/2018 Estimated Earnings Release Date China All-Cap: C
JinkoSolar Holding Co., Ltd. JKS 5/24/2018 Estimated Earnings Release Date China All-Cap: D
Jupai Holdings Limited JP 5/24/2018 Estimated Earnings Release Date China All-Cap: C
GOME Retail Holdings Limited SEHK:493 5/24/2018 Earnings Release Date China All-Cap: F
Biostar Pharmaceuticals, Inc. BSPM 5/24/2018 Estimated Earnings Release Date China All-Cap: F
The Bank of East Asia, Limited SEHK:23 5/24/2018 Estimated Earnings Release Date China All-Cap: C