Earnings Season Highlights

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A collection of noteworthy post-earnings reactions
Published on Apr 5, 2023 at 2:57 PM
  • The Week Ahead
Published on Apr 5, 2023 at 12:18 PM
  • Buzz Stocks
  • Intraday Option Activity
Published on Apr 5, 2023 at 12:11 PM
  • Midday Market Check
Published on Apr 5, 2023 at 10:53 AM
  • Buzz Stocks

The shares of FedEx Corp (NYSE:FDX) are up 3.2% at $233.68 at last glance, and trading at their highest levels since August, after the company announced its consolidation plans. FedEx is combining its separate delivery companies into one organization as part of its plan to cut $4 billion in permanent costs by the end of fiscal 2025, hoping to compete better with United Parcel Service (UPS) and Amazon.com (AMZN). 

Options traders are chiming in at triple the intraday average volume after the news. So far, 16,000 calls and 13,000 puts have been exchanged. The weekly 4/6 235-strike call is the most active, followed by the 240 call in the same series, with new positions being opened at both. 

On track for its eighth day of gains in the last nine, FDX is up 34.3% since the start of the year. The stock is nearing "overbought" territory, however, as per its 14-day relative strength index of 77.4, which typically indicates a short-term dip. 

Analysts are split on FedEx stock, with 12 of the 23 in coverage carrying a "strong buy" and 11 a "hold." The 12-month consensus price target of $239.81 is a slim 3.4% premium to current levels. 

Meanwhile, now looks like a good time to weigh in on the security with options. FDX's Schaeffer's Volatility Index (SVI) of 28% sits in the 11th percentile of its annual range, meaning options traders are pricing in low volatility expectations at the moment. 

Published on Apr 5, 2023 at 10:37 AM
  • Buzz Stocks
  • Intraday Option Activity
Published on Apr 5, 2023 at 10:24 AM
Updated on Apr 5, 2023 at 10:24 AM
  • Analyst Update

Raymond James upgraded Clean Energy Fuels Corp (NASDAQ:CLNE) to "outperform" from "market perform" this morning. In addition to a $6 price-target hike, the analyst in coverage called the energy stock a "textbook buy-on-the-dip" case, adding that strong demand for renewables remains despite multiple complications. 

CLNE is up 3.5% to trade at $4.35 at last check. After a post-earnings bear gap in late February, the shares have spent the last month consolidating below $4.60. Year-to-date, Clean Energy Fuels stock is down 16.1%.

Long term, the options pits have been bullish. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Clean Energy Fuels stock sports a 50-day call/put volume ratio of 46.07 that sits higher than all but 9% of readings from the past year. 

Today, however, put volume is running at 13 times the intraday average volume. Options are certainly an intriguing route, per the stock's Schaeffer's Volatility Index (SVI) of 57 ranks higher than just 8% of reading from the past year. What's more, CLNE's Schaeffer's Volatility Scorecard (SVS) tally of 78 suggests it outperforms volatility expectations. 

Published on Apr 5, 2023 at 9:30 AM
Updated on Apr 5, 2023 at 9:38 AM
  • Opening View

Futures on Wall Street are pointed lower this morning, after today's ADP employment report came in well below estimates, with private payrolls rising just 145,000 in March as opposed to expectations of a 210,000 rise. Traders are also digesting surging U.S. trade deficit data for February, which increased to a higher-than-expected $70.5 billion. As a result, Nasdaq Composite Index (NDX), Dow Jones Industrial Average (DJI), and S&P 500 Index (SPX) futures are all in the red.

Continue reading for more on today's market, including:

  • Schaeffer's Senior Quantitative Analyst Rocky White sees key SPX level reemerging.
  • Don't bet on this blue-chip stock just yet.
  • Plus, Johnson & Johnson's settlement; FedEx's new plans; and ALB downgraded.

futures Chart April 052023

5 Things You Need to Know Today

  1. The Cboe Options Exchange (CBOE) saw 980,514 call contracts and 754,245 put contracts traded on Tuesday. The single-session equity put/call ratio rose to 0.77 and the 21-day moving average stayed at 0.78.
  2. Johnson & Johnson (NYSE:JNJ) sports a 3% premarket lead, despite news that the blue-chip pharmaceutical company will, over the next 25 years, pay $8.9 billion to settle claims talc in its baby powder and other products led to cancer. In the last 12 months, JNJ is down 10.2%.
  3. FedEx Corp (NYSE:FDX) is 2.2% higher before the bell, and adding to a 30.8% year-to-date lead, after the firm announced a dividend hike of 10%, consolidation of its different business units, and changes to executive compensation packages.
  4. Bank of America downgraded Albemarle Corporation (NYSE:ALB) stock to "underperform" and cut its price target to $195 -- implying roughly 7% downside to last night's close. ALB, which has lost 26.2% in the last nine months, was last seen down 3.9% in electronic trading.
  5. ISM services data is due out today.

Buzz 0405

European Investors Remain Cautious

Asian market settled on both sides of the aisle Wednesday. Japan’s Nikkei fell 1.7%, despite the country’s services purchasing managers’ index (PMI) rising to 55 in March for a seventh-straight expansion. The reading was also the second strongest in the history of the survey. Hong Kong’s Hang Seng and China’s Shanghai Composite were closed for holiday, while the South Korean Kospi added 0.5%.

European markets are mixed as well amid cautious investor sentiment. London’s FTSE 100 is up 0.4% midday, while the French CAC 40 inches 0.1% lower, and the German DAX drops 0.3%.

Published on Apr 5, 2023 at 8:00 AM
Updated on Apr 5, 2023 at 8:00 AM
  • Indicator of the Week
Published on Apr 4, 2023 at 4:30 PM
  • Market Recap

The major index logged a string of losses for Tuesday's session, lower on news that job openings data fell for the first time in two years, to just below 10 million. As investors digest the suggestion of a slowing economy just one day off of oil's big post-cut pricing surge, Wall Street's "fear gauge," the Cboe Volatility Index (VIX), snapped its seven-day losing streak.

Continue reading for more on today's market, including:

  • Why this telecom behemoth brushed off a bull note.
  • Energy drink stock with plenty of juice.
  • Plus, bulls blast ETSY; trendline suggests bullish outlook; and headwinds pressure airline giant.

Closing Indexes Summary April 4

NYSE and Nasdaq Stats April 4

5 Things to Know Today 

  1. General Motors (GM) will see around $1 billion in annual savings due to the approximately 5,000 severance offers employees have taken, as the company continues its expense cut efforts. (MarketWatch)
  2. More than $2 million was invested in Black female-owned companies and non-profits by Goldman Sachs (GS), as part of the banking name's wider efforts to realign capital via its One Million Black Women program. (CNBC)
  3. Options bulls blasted Etsy stock after analyst note.
  4. Bullish trendline set to boost Skyworks stock.
  5. Headwinds put pressure on this major airliner.

There were no earnings of note today.

Unusual Options Activity April 4

Gold Logs Another Notable Gain

Following yesterday's OPEC+ surge, oil futures eked out a modest win in Tuesday's trading. For the session, May-dated crude rose 29 cents, or 0.4%, to close at $80.71 per barrel -- their highest level since Jan. 26.

Gold enjoyed a sizable jump this afternoon, as commodity investors digested jobs data out of the U.S. June-dated gold added $37.80 or 1.9%, to settle at $2,038.20.

Published on Apr 4, 2023 at 3:14 PM
  • Quantitative Analysis

CVS Health Corp (NYSE:CVS) stock is trading at $76.17 at last check, pacing for its fourth win in five sessions. CVS carries a hefty 18.2% year-to-date deficit, thanks to a long pullback that started in mid-February before culminating in a March 23, two-year low of $72.10. Despite a brief bounce from this floor, CVS could soon slip again, too, if past is precedent.

CVS Intraday

The stock's recent low comes amid historically low implied volatility (IV), which has been been a bearish combination before. Schaeffer's Quantitative Analyst Rocky White's data shows three similar signals in the last five years when CVS was trading within 2% of its 52-week low, while its Schaeffer's Volatility Index (SVI) ranked in the 20th percentile of its annual range or lower. This is currently the case with CVS Health stock's SVI of 20%, which ranks in the low 12th percentile of its annual range. 

One month after these signals, the equity was lower 67% of the time to average a 4% dip. From its current perch, a move of comparable magnitude would push the shares back below $74.

Additional headwinds could come from a round of downgrades and/or price-target hikes, given 14 of the 18 firms in coverage calling CVS Health stock a "buy" or better. Plus, the 12-month consensus target price of $112.71 is a whopping 48% premium to its current perch.

At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), CVS carries a 50-day call/put volume ratio of 3.87 that sits higher than all but 4% of readings from the past year, suggesting a preference for bullish bets. Should this optimism start to unwind, shares could move lower still.

Published on Apr 4, 2023 at 3:06 PM
  • Options Recommendations
Published on Apr 4, 2023 at 12:09 PM
  • Midday Market Check

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