{"id":24587,"date":"2025-02-20T09:42:11","date_gmt":"2025-02-20T15:42:11","guid":{"rendered":"https:\/\/www.eoption.com\/mid-morning-look-february-20-2025\/"},"modified":"2025-02-20T09:42:11","modified_gmt":"2025-02-20T15:42:11","slug":"mid-morning-look-february-20-2025","status":"publish","type":"post","link":"https:\/\/www.eoption.com\/mid-morning-look-february-20-2025\/","title":{"rendered":"Mid-Morning Look: February 20, 2025"},"content":{"rendered":"\n
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Mid-Morning Look<\/span><\/b><\/p>\n

Thursday, February 20, 2025<\/span><\/b><\/p>\n\n\n\n\n\n\n\n
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Index<\/span><\/p>\n<\/td>\n

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Up\/Down<\/span><\/p>\n<\/td>\n

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%<\/span><\/p>\n<\/td>\n

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Last<\/span><\/p>\n<\/td>\n<\/tr>\n

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DJ Industrials<\/span><\/b><\/p>\n<\/td>\n

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-496.78<\/span><\/p>\n<\/td>\n

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1.11%<\/span><\/p>\n<\/td>\n

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44,131<\/span><\/p>\n<\/td>\n<\/tr>\n

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S&P 500<\/span><\/b><\/p>\n<\/td>\n

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-42.82<\/span><\/p>\n<\/td>\n

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0.71%<\/span><\/p>\n<\/td>\n

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6,100<\/span><\/p>\n<\/td>\n<\/tr>\n

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Nasdaq<\/span><\/b><\/p>\n<\/td>\n

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-160.04<\/span><\/p>\n<\/td>\n

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0.80%<\/span><\/p>\n<\/td>\n

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19,895<\/span><\/p>\n<\/td>\n<\/tr>\n

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Russell 2000<\/span><\/b><\/p>\n<\/td>\n

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-21.62<\/span><\/p>\n<\/td>\n

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0.95%<\/span><\/p>\n<\/td>\n

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2,260<\/span><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

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 <\/p>\n

U.S. stock futures traded lower in a narrow range overnight, roughly 18 points for the S&P as markets awaited more economic data, earnings from retail giant WMT<\/span> and as markets digest the ongoing policy changes that are shaking up Washington DC<\/span>. US<\/span> stocks then opened at their best levels, but has since sunk, with the S&P 500 (SPX<\/span>) briefly breaking below 6,100 after posting back-to-back all-time highs on brad market strength. Weighing on sentiment this morning includes: WMT<\/span> earnings which topped views but issued a lower outlook (weighing on other big box retailers); the Philly Fed Index came in better, but new orders halved from the prior month and the inflationary prices paid component advanced. Investors are also focused on President Trump tough talk against Ukraine President Zelinsky, as well as potential cost cuts in defense spending (impacting defense stocks), and overall job cuts in Washington. The market is also reacting to Trump’s Wednesday announcement of fresh tariffs over the next month or sooner, adding lumber and forest products to previously announced plans involving duties on imported cars, semiconductors and pharmaceuticals. With all the headlines and uncertainty (gold prices hitting all-time highs again), U.S. stocks are still down from recent record highs. In earnings, BABA<\/span> results help lift shares of US<\/span> listed China stocks. Asian equities fall, as investors turn risk off amid fresh tariff comments and US<\/span> Fed minutes highlighting officials’ caution over inflation. <\/p>\n

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Economic Data<\/p>\n

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  • Weekly Jobless Claims climbed to 219,000 in the latest week vs. consensus 215,000 and from 214,000 prior week; the 4-week moving average fell to 215,250 from 216,250 prior week; continued claims climbed to 1.869M Feb 8 week (con. 1.871M) from 1.845M prior week (prev 1.850M).<\/li>\n<\/ul>\n<\/div>\n
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    • Feb. Philadelphia Fed factory index 18.1 above the consensus est. 14.3 as new orders index at 21.9 vs 42.9, the employment index at 5.3 vs 11.9 while the inflationary prices-paid index higher at 40.5 vs 31.9 prior as Fed future index at 27.8 vs 46.3 and Philadelphia Fed prices-received at 32.9 vs 29.7.<\/li>\n<\/ul>\n

       <\/span><\/p>\n

       <\/span><\/p>\n\n\n\n\n\n\n\n\n\n
      \n

      Macro<\/span><\/p>\n<\/td>\n

      		\n

      Up\/Down<\/span><\/p>\n<\/td>\n

      		\n

      Last<\/span><\/p>\n<\/td>\n<\/tr>\n

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      WTI Crude<\/span><\/b><\/p>\n<\/td>\n

      		\n

      0.27<\/span><\/p>\n<\/td>\n

      		\n

      72.52<\/span><\/p>\n<\/td>\n<\/tr>\n

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      Brent<\/span><\/b><\/p>\n<\/td>\n

      		\n

      0.44<\/span><\/p>\n<\/td>\n

      		\n

      76.48<\/span><\/p>\n<\/td>\n<\/tr>\n

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      Gold<\/span><\/b><\/p>\n<\/td>\n

      		\n

      16.00<\/span><\/p>\n<\/td>\n

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      2,952.10<\/span><\/p>\n<\/td>\n<\/tr>\n

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      EUR\/USD<\/span><\/b><\/p>\n<\/td>\n

      		\n

      0.0018<\/span><\/p>\n<\/td>\n

      		\n

      1.0439<\/span><\/p>\n<\/td>\n<\/tr>\n

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      JPY\/USD<\/span><\/b><\/p>\n<\/td>\n

      		\n

      -1.85<\/span><\/p>\n<\/td>\n

      		\n

      149.63<\/span><\/p>\n<\/td>\n<\/tr>\n

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      10-Year Note<\/span><\/b><\/p>\n<\/td>\n

      		\n

      -0.028<\/span><\/p>\n<\/td>\n

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      4.507%<\/span><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

       <\/span><\/p>\n

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      Sector Movers Today<\/p>\n

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      • In Utilities: SO<\/span><\/b> reported Q4 EPS of $0.5 missing ests $0.51 citing higher operating costs and interest expenses; in research, CMS<\/span><\/b> was upgraded to Overweight from Equal Weight at Barclays as the firm reshuffled its preferences in Michigan utilities following the Q4 earnings, now seeing CMS as the preferred way to invest in the state’s “premium” regulatory environment. DTE<\/span><\/b> was downgraded to Equal Weight from Overweight at Barclays in conjunction with call saying DTE eventually needs to deal with the renewable natural gas tax credit roll-off, which will require an acceleration of rate base growth, capex ramp, and additional equity.<\/li>\n<\/ul>\n<\/div>\n
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        • In Chemicals: CE<\/span><\/b> was downgraded to Sector Perform from Outperform at RBC Capital noting overexposure to auto end markets (especially Europe ICE) has resulted in NT earnings headwinds from lower builds\/bloated inventories throughout the chain. In ag chemicals, two earnings results, as Piper noted both CF<\/span><\/b> and NTR<\/span><\/b> reported Q424 results which were generally in line with consensus and consistent with the ag market conditions during the period. The good news for investors is that both companies have given positive guidance for 2025 regarding the nutrient S\/D situation going forward and the global grain market balance.<\/li>\n
        • In Consumer Products: HLF <\/span><\/b>shares surged on new CEO announcement, while Q4 results top views (EPS<\/span> $0.36\/$1.21B sales vs. est. $0.22\/$1.19B) as Mizuho noted Q4 marked third consecutive quarter of yr\/yr growth in new distributors (solid +22%) & 12-mo. y\/y re-qualification of distributor leader’s ex China also increased. CELH<\/span><\/b> ests tweaked lower at Bank America to reflect higher gross-to-net sales promo spend; PG<\/span><\/b> shares slipped after saying shipments to the US have been lower in Q1 so far.<\/li>\n
        • Cruise lines slumped (CCL<\/span>, NCLH<\/span>, RCL<\/span>, VIK<\/span><\/b>) as Secretary of Commerce Howard Lutnick, in an interview with Fox Jesse Waters last night, said President Trump’s goal is simple—abolish the IRS and “let all the outsiders pay.” He even pointed to cruise lines not paying taxes as an example.<\/li>\n<\/ul>\n

           <\/span><\/p>\n

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          Stock GAINERS<\/p>\n

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          • AMPL<\/span><\/b> +14%; shares jump on strong results as DA Davidson upgraded to Buy saying the co exited 2024 with strong enterprise momentum and positive indicators that current sales re-acceleration is durable in 2025 and beyond.<\/li>\n<\/ul>\n<\/div>\n
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            • BABA <\/span><\/b>+10%; reported Q3 revenue of 280.15B yuan ($38.58B) compared with the 279.34B yuan expected by Wall Street; said strong year-end shopping sales and the success of its strategy to attract cost-conscious consumers helped results.<\/li>\n
            • BMRN<\/span><\/b> +7%; results above ests as Cantor noted growth looks very good this year at +9-12% y\/y ($3.1B – $3.2B vs. est. at $3.095B), and the earnings power is becoming a lot more noticeable: +20-25% growth y\/y ($4.20-4.40 vs. est. $4.15). Operating margins also continue to expand: 2025 guidance is for 32-33% op margins (vs. 32%).<\/li>\n
            • CWAN<\/span><\/b> +12%; reported strong Q4 results, marked by 25% ARR growth and net retention reaching 116% and provided a 1Q and year revenue forecast that topped estimates (Piper upgraded to Overweight).<\/li>\n
            • HAS<\/span><\/b> +10%; top and bottom-line results top ests while said they expect total annual revenue to be up slightly compared with analysts’ estimates for a 4% rise; also unveiled a new strategic plan targeting $1B in cost savings<\/li>\n
            • HLF<\/span><\/b> +29%; shares surge on new CEO news, while Q4 results top views (EPS<\/span> $0.36\/$1.21B sales vs. est. $0.22\/$1.19B) as Mizuho noted Q4 marked third consecutive quarter of yr\/yr growth in new distributors (solid +22%)<\/li>\n
            • LKQ<\/span><\/b> +7%; reported Q4 adj EPS $0.80 topping the $0.74 estimate saying they have been ramping up its cost-cutting by selling underperforming assets, including its operations in Poland and Bosnia, and cutting jobs.<\/li>\n
            • SHAK <\/span><\/b>+13%; shares rose after guiding 2025 adj. EBITDA $205M-$215M (up from prior $200-$215M view) and vs. est. $209.1M, forecasts 2025 comp sales about +3% on same rev outlook and confidence to achieve 22% restaurant margin.<\/li>\n<\/ul>\n

               <\/span><\/p>\n

              \n

              Stock LAGGARDS<\/p>\n

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              • ACVA<\/span><\/b> -8%; posted a strong Q4 with both revenue and adjusted EBITDA finishing above consensus estimates citing January strength matching industry data but flagged slowing momentum into February driving a high level of caution, as guidance for 1Q25 and the full year came in softer than expected.<\/li>\n<\/ul>\n<\/div>\n
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                • ARDX <\/span><\/b>-13%; following Q4 results which disappointed investors.<\/li>\n
                • CVNA <\/span><\/b>-13%; reported strong 4Q results with retail unit growth accelerating to more than 50% y\/y from 34% q\/q, and above consensus growth of 43%. Shares slipped as the ATM offering weighed on shares while retail & wholesale GPU also came in modestly below Street.<\/li>\n
                • EPAM<\/span><\/b> -14%; reported top and bottom-line beats but shares slipped on mixed Q1 guidance as sees Q1 EPS $2.22-$2.32 vs. est. $2.60 and revs better at $1.28B-$1.29B vs. est. $1.27B; yearly EPS view also below ests.<\/li>\n
                • KVYO <\/span><\/b>-12%; Q4 beat highlighted by its largest revenue upside since its first IPO quarter as Q4 sales metrics were all positive, including the most net new customer additions (+10k), but Needham said weakness likely a negative reaction to the company’s new pricing model not driving any upside to FY25 revenue guidance.<\/li>\n
                • PLTR<\/span><\/b> -12%; shares extend sharp declines from Wednesday, breaking below $100 per share after the Washington Post reported that the Trump White House warned the Defense Department of budget cuts, citing a memo saying cuts could amount to 8% a year for five years. Also weighing on shares was news of CEO Alex Karp’s new share sale plan (Karp adopted a new Rule 10b5-1 trading plan to sell up to 9.975M shares through Sept. 12, 2025).<\/li>\n
                • TRUP<\/span><\/b> -20%; shares slip as Q4 earnings and revs miss while margins were better, while gross new adds in its Trupanion Care and Other Subscription Products segments fell 10.1% to around 57,000 for the quarter ended.<\/li>\n
                • VMEO<\/span><\/b> -20%; after forecasts 2025 Ebitda adjusted below what analysts expected, citing a desire to invest as much as $30 million incrementally in the business.<\/li>\n
                • WMT<\/span><\/b> -5%; reported Q4 beat (EPS<\/span> $0.66\/$180.55B vs. est. $0.65\/$179B) on better comps but sees Q1 adj EPS $0.57-$0.58 vs. est. $0.65 and year adj EPS $2.50-$2.60 vs. est. $2.77 (shares of COST<\/span>, TGT<\/span>, BJ<\/span><\/b> and discount stores DLTR<\/span>, DG<\/span>, FIVE<\/span><\/b> moved lower in reaction).<\/li>\n<\/ul>\n<\/div>\n

                  <\/p>\n