Market 2018-02-12 (NVDA, FB, and more)

Market continues its bounce following last Friday. All three indices finish with more than +1.4% gain. Tech, Energy and Materials lead the rally.

Commodities: Crude +0.2% to $59.3. Gold +0.7% to $1,324.70.

News

Some data from last week: investors pulled a record $23.6B from the SPDR S&P 500 ETF (SPY), according to Bloomberg. SPY is the most popular SP500 ETF. That's a 8% of the total assets from the beginning of the week. It should be considered bullish because the selling pressure is much less after loose hands got off table.

Disney (DIS +0.3%) raises theme park ticket price. In other news, Alibaba (BABA +0.4%) has signed a deal to offer Disney shows on its Youku video streaming platform.

Airbus has halted all deliveries of its Pratt & Whitney-powered (UTX) A320neo after the latest disclosure in a series of flaws with the next-generation engine, according to IndiGo, the company's biggest customer for the aircraft. Nevertheless, UTX gains +1.9% today along with other defense companies.

 Unilever (+1.9%) has threatened to withdraw ads from platforms like Google and Facebook if they do not do enough to police extremist and illegal content.

Google (GOOG +1.4%) will start renting out its AI chips tensor in “limited quantities” to Google Cloud Platform customers wanting to run machine learning models. Usage is billed by the second and costs $6.50 per Cloud TPU per hour.

Winners

Hess (HES +4.8%) is higher as Credit Suisse upgrades shares to Neutral with an unchanged $42 PT after recent selloff.

Apple (+4.1%), DWDP (+3.2%) and BA (+3.3%) lead Dow Jones.

Gold miner enjoy the rising gold price. GDX +1.3%, NUGT +9.6% (DUST -7.8%)

Losers

NVDA (-1.8%) is hurt by the news that Amazon (AMZN +3.5%) plans to become an AI chipmaker. To be honest, I don't believe Amazon is capable to deliver competitive products. This is buying opportunity for NVDA.

Target (TGT -0.8%) announces it will begin same-day delivery on March 1 of more than 55K groceries, essentials, home, electronics, toys and other products in the Minneapolis-St. Paul area today in partnership with Shipt. Looking ahead, Targets expects the majority of its U.S. stores will offer same-day service by the 2018 holiday season. Costco (COST +0.2%) has started their same-day grocery delivery service. Walmart (WMT +0.2%)/Costco/Target will definitely put pressure on Amazon.

Snap's (SNAP -0.9%) VP of Sales, Jeff Lucas, has left the company. He is responsible for 90% of ad sales at the company. Lucas is the seventh executive to leave the company since its IPO last year.

Facebook (FB +0.2%) is reported of losing younger users more quickly than previously estimated. A decline of 5.8% in the age 18-24 user base is expected in 2018. Facebook is still growing in the U.S. market, it says, but mainly due to older users signing on; meanwhile, Snapchat (SNAP -0.9%) is pulling young users away from Facebook at a quicker pace than Facebook's Instagram platform is. Well, I am not surprised because similar reports have been circlulated ever since Facebook IPO. It is a buying opportunity. In my recent post, I have explained my $240 price target in 12 months.

General Electric (GE -0.9%) is hammered again by J.P. Morgan analyst and longtime GE bear Stephen Tusa, who cuts PT to $14 from $16 and maintains an Underweight rating.

ULTA (-4.6%) after Women's Wear Daily details more accusations against the retailer on selling used and returned items as new.

Earnings in AH

Vipshop Holdings (VIPS +6.8%): Q4 EPS of $0.22 beats by $0.02. Revenue of $3.7B (+23.3% Y/Y) beats by $20M. Shares +12% in AH.

Molina Healthcare (MOH): Q4 EPS of -$4.59 vs consensus $0.18. Revenue of $4.69B (+11.9% Y/Y) misses by $280M. 2018 guidance: Total revenues: ~$18.8B; premiums: ~$17.5B; medical care costs: ~$15.6B; medical care ratio: ~89%; net income: $202M - 236M; EPS: $3.00 - 3.50; non-GAAP EPS: $3.23 - 3.73. Shares -5.6% in AH.

My Trades Today

Day-traded AHT ($5.5 --> $5.7).

Earnings Tomorrow


  • pre-market:   APRN, ARCC, HCP, MLM, ONDK, PEP, SINA, WB, TRU, UAA
  • post-market:  AMX, BIDU, DENN, EFC, FANG, FOSL, MET, OHI, OXY, SKT, TEP, TWLO, WU

Comments

  1. UnknownFebruary 12, 2018 at 2:46 PM

    对大盘真正的考验在周三和周四，有两个重要的inflation相关的数据。话说今天大盘涨这么多的catalyst到底是什么呢？

    ReplyDelete
    Replies
    1. UnknownFebruary 12, 2018 at 5:04 PM

      我也觉得很突兀，这周必然还有波折。今天道指明星股被拉高，导致指数都很好看，可是个股情况却不是这样，Russell 2000 （IWM）今天只涨了0.95%，远不如三大指数

      Delete
    2. UnknownFebruary 13, 2018 at 2:55 PM

      看上去波音和果子贡献了不少。波音好股，defense sector以cash flow 作估值基础，这样波音并不是很贵。Pair trade 是 LONG XPO (季报后， buy on the dips) SHORT UPS (季报后，capex, margin concerns 我们先前讨论过的)。最近还入了CAT，觉得这个应该可以有。

      Delete
    3. UnknownFebruary 13, 2018 at 2:59 PM

      还有马鬃要弄自己的fleet，对XPO 利好（也是被收购对象），对UPS, FDX算是modest negative （马鬃在这两家的revenue exposure并不是特别大），但是secular implications比较不好。

      Delete
    4. UnknownFebruary 13, 2018 at 7:02 PM

      赞，BA 的订单可以保证好几年开足马力，下降空间不大。我的UPS还拿着，今天反弹了一些，打算再拿一阵子。CAT会从基建中得利，这个还要等国会的消息

      Delete
    5. UnknownFebruary 14, 2018 at 8:18 AM

      CAT是基建股，但是mining CAPEX cycle更重要。如果今年commodity cycle有点起色的话，是利好。个人对Trump的基建项目不是很看好，听说他想靠private sector的3P partners弄钱，但是大部分的investors不看好他拍胸脯保证的收益率，地方政府好像很多也没钱弄这些项目。即使house和senate同意了，implementation risk还是挺大的。

      Delete
  2. Ha SongFebruary 13, 2018 at 11:40 AM

    Are you still holding PG? Any idea about mid or long term trend?

    ReplyDelete
    Replies
    1. UnknownFebruary 13, 2018 at 12:06 PM

      Yes, I am still holding PG with average price $87, -6% return now. I am not worried about PG since I plan to hold for long-term. For 2018, PG expects rev growth 3% and EPS growth 5-8%, better than previous. I will wait for the share price to come back while collecting dividends.

      Delete

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