From Briefing.com: 4:08 pm Plexus beats by $0.05, reports revs in-line; guides Q2 revs below consensus (PLXS) :
Reports Q1 (Dec) earnings of $0.82 per share, $0.05 better than the Capital IQ Consensus of $0.77; revenues rose 3.0% year/year to $635 mln vs the $633.93 mln Capital IQ Consensus.
PLXS won 51 Manufacturing Solutions programs during the quarter representing approximately $217 mln in annualized revenue when fully ramped into production,
Reports operating margin of 5.3%, ROIC of 17.3%.
Co purchased $7.1 mln of its shares at average price of $48.79/share during the quarter.
Co issues guidance for Q2, sees GAAP EPS of $0.71-$0.79. The Capital IQ Consensus is $0.73; sees Q2 revs of $620-$650 mln vs. $657.85 mln Capital IQ Consensus Estimate.
4:30 pm : Wednesday's trading session closed in the neighborhood of where it opened as investors generally elected to watch rather than act amid a batch of economic data and a slew of corporate news. The major averages finished mixed with the S&P 500 and the Nasdaq adding 0.2% and 0.3%, respectively, while the Dow fell 0.1%. A late burst of buying interest led by the financial sector, however, left each of the major average at, or near, their best levels of the day when the closing bell rang.
Frankly, there wasn't a lot of trading excitement throughout the session. The major indices all held to tight trading ranges, reined in by a lack of any meaningful sector leadership, a stark jump in long-term rates, and an awareness that Fed Chair Yellen was going to be speaking at 3:00 p.m. ET on the goals of monetary policy.
Ms. Yellen's speech, as it turned out, was mostly an academic exercise. She didn't provide any "new" information for the market per se, yet her reminder that interest rates are apt to creep higher provided some verbal reassurance that facilitated the positive finish for today's market.
Her speech followed a mixed batch of economic data this morning, which featured a stronger than expected Industrial Production report for December, a weaker than expected NAHB Housing Market Index for January, and the highest year-over-year increase in the Consumer Price Index (+2.1%) since June 2014.
In aggregate, Ms. Yellen's remarks and today's data didn't alter the view that the Fed will continue to abide by its projection for three rate hikes in 2017.
The financial sector (+0.8%) had a slow-developing rally today, but eventually got it in gear toward the end of the session and finished at its highs for the day. A lackluster response to better-than-expected earnings news from Goldman Sachs (GS 234.29, -1.45), Citigroup (C 57.39, -0.99), and U.S. Bancorp (USB 50.56, +0.25) kept a lid on things, yet there was underlying strength in other components that proved to be an effective offset and a driver of today's gains.
Thus far, the financial sector has been fairly slow to respond to better-than-expected earnings reports as it continues to digest a huge move following the election, which produced a 20.5% gain for the sector in the fourth quarter.
In other corporate news, Target (TGT 66.85, -4.09) lowered its Q4 guidance following disappointing holiday sales. The news had a ripple effect on other retailers, which led to a 0.3% decline in the SPDR S&P Retail ETF (XRT 44.25, -0.11, -0.39). Naturally, the consumer discretionary sector (-0.2%) felt the pressure and closed near the bottom of today's leaderboard.
The energy sector (-0.3%) also posted a lackluster performance, falling in tandem with crude oil. The commodity's downtick was forced by some renewed strength in the dollar and expectations that U.S. producers will boost output in response to the higher prices. The U.S. Dollar Index (101.25, +0.92) finished 0.9% higher while gold closed down 0.1% at $1,212.10/ozt.
The top-weighted technology sector outperformed the broader market with a 0.3% increase. The sector was driven primarily by a bullish performance from chipmakers, which rebounded from Tuesday's selling and drove a 1.4 gain in the PHLX Semiconductor Index.
The U.S. Treasury market came under selling pressure in the overnight trade -- pressure which never relented much during the regular session. Securities across the curve were on the defensive, with the belly and back end of the curve getting hit the hardest. The yield on the 5-yr note jumped 10 basis points to 2.23%. The yield on the 10-yr note, meanwhile, also increased 10 basis points to 2.42%
Reviewing today's economic data:
Total CPI rose 0.3% (Briefing.com consensus +0.3%) in December while core CPI, which excludes food and energy, increased 0.2% (Briefing.com consensus +0.2%). On a year-over-year basis, total CPI is up 2.1% and core CPI has increased 2.2%.
The key takeaway from this report is that the consumer inflation rate is steadily rising, which is supporting the Federal Reserve's tightening bias at this juncture.
December Industrial Production increased 0.8% (Briefing.com consensus +0.6%) while Capacity Utilization rose to 75.5% (Briefing.com consensus 75.4%).
The key takeaway from the report is that overall industrial production remains soft, having slipped at an annual rate of 0.6% in the fourth quarter and increasing just 0.5% year-over-year.
The NAHB Housing Market Index for January fell to 67 from a revised 69 in December (from 70).
Tomorrow's economic data will include Initial Claims (Briefing.com consensus 252,000), Housing Starts (1.193 million), and Philadelphia Fed (briefing.com consensus 15.3). All reports will be released at 8:30 a.m. ET.DJ30 -22.05 NASDAQ +16.93 SP500 +4.00 NASDAQ Adv/Vol/Dec 1679/1.52 bln/1278 NYSE Adv/Vol/Dec 1564/913 mln/1353
On Wednesday, the broader market mostly recovered from yesterday's losses. In the Nasdaq Composite, gains took the index up 16.93 points (+0.31%) to 5555.65 at the close. The S&P 500 also was in the green today, adding 4.00 points (+0.18%) to 2271.89, and the Dow Jones Industrial Average rounded out the trio lower by 22.05 points (-0.11%) to 19804.72.
Today's market data included the Total CPI reading, which rose 0.3% in December while core CPI, which excludes food and energy, increased 0.2%. On a year-over-year basis, total CPI is up 2.1% and core CPI has increased 2.2%. Also, December Industrial Production increased 0.8% while Capacity Utilization rose to 75.5%. Lastly, the NAHB Housing Market Index for January fell to 67 from a revised 69 in December (from 70).
49.60, +0.13 +0.26%) space picked up on Wednesday as action finished close to highs. Component Hewlett Packard Enterprise (HPE 22.86, +0.17 +0.75%) was among the better performing names today after acquiring SimpliVity for $650 million in cash. The company expects the acquisition to be accretive to earnings in the first full fiscal year following close. Also, HPE's HPE Software COO Chris Hsu to resign and become CEO of new entity. The spin-off/merger transaction is currently targeted to be completed by August 31. Other sectors as measured by the S&P closed the session XLF +0.83%, XLB +0.63%, XLI +0.38%, XLP +0.34%, XLRE +0.23%, XLU -0.12%, XLV -0.13%, XLY -0.18%, XLE -0.23%, IYZ -0.98% as Financials performed the best.
In the S&P 500 Information Technology (833.76, +2.72 +0.33%) space, trading recouped yesterday's losses as the finished just shy of highs of the day. Component IBM (IBM 166.80, -1.09 -0.65%) was among the weaker names in the sector today after announcing a 5-year deal with the U.S. Army to build, manage and operate a cloud solution. Other notable movers in the sector finished QRVO +3.34%, AVGO +3.30%, SWKS +3.10%, CTXS +2.93%, MU +2.67%, MCHP +2.39%, WDC +2.26%, KLAC +2.04%, LRCX +1.96%, TDC +1.84%, NVDA +1.82%, GLW +1.53%, QCOM +1.46%, ADSK +1.39%.
Other notable news items among sector components:
Adobe Systems (ADBE 108.79, +0.79 +0.73%) authorized new $2.5 billion stock repurchase program through the end of fiscal year 2019.
IBM (IBM) announced that the U.S. Army has signed a five-year, multi-million dollar contract with IBM to build, manage and operate a cloud solution for greater IT flexibility, efficiency and performance.
ServiceNow (NOW 82.85, +1.44 +1.77%) acquired DxContinuum in an all-cash transaction. Financial terms were not disclosed.
Alphabet's (GOOG 806.07, +1.46 +0.18%) Google acquired developer platform provider Fabric from
Twitter (TWTR 17.11, +0.15 +0.88%). Financial terms were not disclosed.
Viavi (VIAV 8.40, -0.09 -1.06%) approved a restructuring and global workforce reduction plan, and will reduce workforce by up to 10%.
CenturyLink (CTL 25.47, flat) was awarded a ten-year NASPO ValuePoint Cloud Solutions Master Agreement which allows CenturyLink to sell the company's cloud solutions to state and local governments.
Hewlett Packard Enterprise (HPE) to acquire SimpliVity for $650 million in cash. The company expects the acquisition to be accretive to earnings in the first full fiscal year following close. HPE's HPE Software COO Chris Hsu to resign and become CEO of new entity. The spin-off/merger transaction is currently targeted to be completed by August 31.
Avnet (AVT 47.09, +0.57 +1.23%) provided a financial outlook data for its Technology Solutions business amid the pending sale to Tech Data (TECD 84.75, +1.08 +1.29%).
In reaction to quarterly results:
ASML (ASML 122.97, +7.06 +6.09%) reported better than expected Q4 earnings and revenues of EUR1.23 and EUR1.91 billion. For Q1, the company sees revenues of about EUR1.8 billion.
TD Ameritrade (AMTD 46.65, +0.78 +1.70%) reported in-line Q1 EPS and revenues of $0.41 and $859 million, respectively. For FY17, the company sees EPS of $1.50-1.80.
ADTRAN (ADTN 22.70, +0.15 +0.67%) reported better than expected Q4 earnings and revenues of $0.21 and $163 million, respectively.
Linear Tech (LLTC 62.45, +0.11 +0.18%) -- being acquired by Analog Devices (ADI 73.01, +0.73 +1.01%) -- reported better than expected Q2 earnings of $0.54 on revenues which were in-line with market expectations at $375.82 million.
Companies scheduled to report quarterly results tonight/tomorrow morning: NFLX, PLXS, PTC/CHKP, WNS
Analyst actions:
NOW was upgraded to Positive from Mixed at OTR Global;
XLNX was downgraded to Underweight from Equal Weight at Barclays,
HIMX was downgraded to Neutral from Outperform at Credit Suisse;
EXPE was initiated with a Strong Buy at Miller Tabak,
PCLN was initiated with a Buy at Miller Tabak,
TRIP and LTRPA were initiated with a Hold at Miller Tabak,
SYNT was initiated with a Market Perform at Cowen,
PANW was initiated with a Hold at Jefferies,
XTLY was initiated with a Buy at Craig Hallum,
FTV was initiated with a Perform at Oppenheimer,
CCMP was initiated with a Hold at Aegis Capital
3:57 am ASML beats by EUR0.25, beats on revs; guides Q1 revs above consensus (ASML) :
Reports Q4 (Dec) earnings of 1.23 per share, 0.25 better than the Capital IQ Consensus of 0.98; revenues rose 33.0% year/year to 1.91 bln vs the 1.77 bln Capital IQ Consensus.
Co issues upside guidance for Q1, sees Q1 revs of ~1.8 bln vs. 1.78 bln Capital IQ Consensus Estimate.
Co sees gross margin of around 47%
