Top 10 things to watch Friday, February 17
1. Thursday’s late-market sell-off following aggressive Fed talk continues through Friday with the Dowthe S&P 500 and the Nasdaq set to open lower. Oil prices withdraw 3%. The Treasury return over 10 yearsat about 3.9%, has not been this high since November.
2. Deere (DE) posts a hefty profit of $6.55 per share for the first quarter of fiscal 2023, beating estimates of $5.53. Manufacturing & Precision Farming fiscal Q1 operating profit up 308% year over year. Raises full year net income forecast from $8.75 billion to $9.25 billion. Previously it was $8 billion to $8.5 billion. The club owns it Caterpillar (CAT).
3. Citi begins reporting on the US beverage, household and personal care industries. Put buy ratings on club names Constellation Brands (STZ), Estee Lauder (EL) and Proctor & Gamble (PG). Analysts there favor high-quality names that have fallen on temporary issues with gross margin expansion opportunities as raw material prices fall and real pricing power. They also like Colgate-Palmolive (CL), Coca-Cola (KO), and Monstrous drink (MNST); resells Kimberly Clark (KMB) and Brown-Forman (BF.b).
4. Citi is tactically cautious with Club Sales team (CRM) in March 1 earnings. Their partner checks suggest that demand continues to slow, limiting upside potential in the outlook for the quarter and fiscal year 2024. Analysts believe that the profit margin in CRM is already priced in.
5. design kings Equities (DKNG) rose 11% early Friday after higher-than-expected earnings and much smaller-than-expected adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) loss: $49.9 million versus an expected loss of $112.3 million. Also raises full-year revenue forecast and sees smaller-than-expected adjusted EBITDA loss. Expect adjusted EBITDA to be positive in fiscal year 2024.
6. Year (ROKU) double-upgraded at Bank of America to buy, price target to $85 per share. BofA says ROKU is outperforming the broader ad market and ad spend across industries has finally bottomed out.
7. Evercore move walmart (WMT) on its tactical outperform list ahead of next Tuesday’s win, but makes a negative tactical call DIY store (HD) and Goal (TGT).
8. CH Robinson (CHRW) downgraded at JPMorgan to underweight (sell); says it’s hard to have a freight and logistics broker when margins shrink.
9. GE Healthcare (GEHC) started with a buy at Mizuho, price target of $90 per share.
10. UBS says it expects a soft guide for fiscal year 2023 Nordstrom (JWN) to put pressure on the stock. UBS Evidence Lab data shows slowing traffic trends in its stores.
(Jim Cramer’s Charitable Trust is long CAT, STZ, EL, PG, CRM. See here for a full list of stocks.)
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