Early Look – 7:00AM EST
Friday, October 24, 14
Index
Up/Down
%
Last
DJ Industrials
-38.00
0.23%
16,575
S&P 500
-6.70
0.34%
1,939
Nasdaq
-16.00
0.40%
3,989
Cautious global markets Friday, after what has so far been one of the best weekly gains for U.S.
averages in over a year, on reports Ebola reaches NY via infected doctor. Asian stocks rise on positive
Korean, Chinese data, while European markets are modestly lower (positive UK growth data). In
earnings overnight, AMZN disappoints Wall Street, as quarterly results/guidance fall well short of
consensus views, while MSFT shares up post earnings (MANY more earnings results can be seen below).
Treasuries up slightly (have fallen 5 of last 6 days), on the Ebola reports, while gold inches higher, oil
falls and the dollar weakens. Investors also have to think about this weekend’s release of results from
the European Union’s stress tests for banks, as well as next week’s Federal Reserve policy meeting.
Earning still to come today from PG, F, CL, MCO, BMY, UPS, DLPH, and STT
It was another strong session for major averages Thursday, with the S&P 500 Index on pace for its best
week since January 2013, and the NASDAQ on pace as well (up little over 5% this week). Thursday’s
gains were led on stronger European data, easing geopolitical fears, and most importantly earnings,
(Dow Components CAT and MMM accounted for about 90 of the Dow’s 216 point gain yesterday after
better earnings). Industrials, Technology, Energy and Healthcare led markets on Thursday
In Asian markets, The Nikkei Index rose 152 points to 15,291, the Shanghai Index was flat at 2,302, and
the Hang Seng Index dropped 30 points to 23,302
Market Closing Prices Yesterday




The S&P 500 Index gained 23.71 points, or 1.23%, to 1,950.82
The Dow Jones Industrial Average rose 216.58 points, or 1.32%, to 16,677.90
The Nasdaq Composite spiked 69.95 points, or 1.60%, to 4,452.79
The Russell 2000 Index jumped 19.61 points, or 1.79% to 1,116.49
Events Calendar for Today

10:00 AM ET
New Home Sales MoM, for Sept…est. (-6.8%) to 470K
Macro
Up/Down
Last
WTI Crude
-0.74
81.35
Brent
-0.80
86.03
Gold
3.10
1,232.20
EUR/USD
0.0006
1.2653
JPY/USD
-0.13
108.14
10-Year Note
-0.025
2.25%
World News
 A doctor who traveled back to New York from an Ebola-stricken region of Africa has tested
positive for the deadly virus after being rushed to the city’s Bellevue Hospital on Thursday, the
New York Times reported. Dr. Craig Spencer, 33, had a fever of 103 degrees Fahrenheit and was
suffering from nausea when he was taken to Bellevue for testing, reports said. The New York
Times subsequently said Spencer had tested positive for Ebola and was placed in isolation. A
second test to confirm the findings was planned by the U.S. Centers for Disease Control and
Prevention, Reuters said. http://goo.gl/77sUyT
 U.K. Economic growth slowed to 0.7% in Q3, down from 0.9% in the previous quarter, data from
the Office for National Statistics showed on Friday. The reading was in line with economists'
expectations and marked a seventh straight month of economic expansion in the U.K
 Fed published bank stress test scenarios for next year’s tests; will test 31 banks; will look at
corporate debt exposure
 China Sept new home prices fell in 69 cities (vs 68 cities in Aug)
 Japan Finance Minister said not aiming to weaken yen; important to implement next sales tax
increase as planned; will take steps with next budget in Dec to ensure sales tax can be increased
 Rousseff on 54% of valid votes; Neves 46% ahead of Sunday’s runoff according to a poll
 Citigroup Bets ECB Deploys QE as Morgan Stanley Sees Odds at 40% http://goo.gl/EZswSY
Sector News Breakdown
Consumer
 Deckers Outdoor (DECK) rpts Q2 eps $1.17; sees FY15 rev growth 15% to $1.825b, vs. prior up
14%; sees 3Q EPS $4.46 and rev growth 10% YoY vs. est. $4.75 and $816.6M (or 11%)
 DeVry (DV) rpts Q1 EPS ex-items 47c/$462M vs. est. 29c/$455.48M; said new undergraduate
student enrollments declined 20% to 5,268, vs. 6,589 in the prior year; total undergraduate
student enrollments declined 15.1% to 39,857 versus 46,966 in previous year period
 Callaway Golf (ELY) rpts Q3 revs $$169M vs. est. $160.6M; sees 2014 EPS 15c-18c vs. prior 12c16c, est. 15c; sees 2015 continued net sales growth 1%-2% on consolidated basis, reflecting 5%6% sales growth in core channels
 Wyndham (WYN) approves $1B increase to share repurchase authorization; raises FY14 adjusted
EPS view to $4.45-$4.48 from $4.34-$4.44 (est. $4.43), after Q3 eps beat by 4c on in-line revs
Energy
 Occidental Petroleum Corp. (OXY) CEO said companies that help explorers find and drill for oil
will lower their fees to maintain market share if crude prices continue to slump.
 Statoil (STO) continues to expand in Australia, with the award of 100% equity share in a large
exploration permit
 A U.S. Energy Information Administration study will show that domestic oil prices will not rise if
the U.S. ban on oil exports is lifted, Reuters said, citing EIA administrator Adam Sieminski
 Clean Energy (CLNE) rpts Q3 eps loss (27c)/$103.4M vs. est. loss (28c)/$103.3M
Financials
 Principal Financial Group (PFG) rpts Q3 eps $1.19/$2.55B vs. est. $1.06/$2.54B; said total co.
AUM $513.5B (up 10% YoY)
 Chubb (CB) rpts Q3 eps $2.17 vs. est. $1.95; sees 4Q operating EPS $2-$2.10, vs. est. $2.07; raises
year EPS to $7.35-$7.45 from prior view $6.75-$6.95 (est. $7.19); said 3Q net written premiums
$3.2B, up 5%
 W.R. Berkley (WRB) rpts Q3 EPS $1.06 vs. est. 91c; said 3Q net premiums earned $1.46B vs.
$1.28B YoY and 3Q net premiums written $1.53B vs. $1.42B YoY
 City National (CYN) rpts Q3 EPS $1.15/$324M vs. est. $1.07/$324.19M; total assets at September
30 grew to $32B, up 10% from last year
 EMC Insurance (EMCI) lowers year eps to $1.55-$1.80 from $2.00-$2.25 prior
 Federated Investors (FII) rpts Q3 EPS of 36c on revs $216.9M (beats by 1c and $2.19M)
 First Niagara (FNFG) rpts Q3 EPS 18c (in-line); NIM 3.21% vs. 3.26% QoQ; said Net interest
income $273.3M
Healthcare
 Pfizer (PFE) announces $11B buyback
 A Johnson & Johnson (JNJ) unit’s design of a metal-on-metal version of its Pinnacle hip implants
isn’t defective, a Dallas jury concluded, ruling against a woman who said the devices poisoned
her in the first case of its kind to go to trial
 Edwards Lifesciences (EW) rpts q3 eps 80c/$607.4M vs. est. 72c/$546M; now sees 2014 adj. EPS
$3.33-$3.39, up from $3.24-$3.34; sees year sales exceeding high end of $2.05B-$2.25B range
(est. $2.23B)
 Cerner (CERN) rpts Q3 eps 42c/$840.1M vs. est. 42c/$856.3M; sees 4Q adj. EPS 46c-47c vs. est.
47c; says sees 4Q new business bookings, $1.15B-$1.25B after reporting Q3 bookings $1.1B
 BioMarin (BMRN) rpts Q3 eps 5c/$176.8M vs. est. (23c)/$170.1M; raises year rev outlook to
$700M-$710M from $680M-$700M and raises low end of Vimizim sales to $65M from $60M
 ResMed (RMD) rpts Q1 EPS 58c/$380.4M vs. est. 58c/$375.1M
 VCA Inc. (WOOF) rpts Q3 eps 56c/$499.6M vs. est. 52c/$459M; sees 4Q adj. EPS 35c-37c, vs. 37c
 Align (ALGN) rpts Q3 eps 47c/$189.9M vs. est. 43c/$188.5M; sees 4Q EPS 47c-50c, vs. est. 51c
 Dolby Labs (DLB) boosts stock buyback by added $200M
 Vitae (VTAE) said positive top-line results achieved from two Phase 1 clinical trials of BACE
inhibitor BI1181181/VTP-37948 in Alzheimer’s
 FDA delayed decision for NPS Pharma’s (NPSP) Natpara to treat hypoparathyroidism to Jan. 24
from Oct. 24
Industrials & Materials
 Lockheed (LMT) comes to $4B agreement with Pentagon for more F-35s, Reuters says
 BASF SE cut profit targets and abandoned its sales target for next year, signaling weaker demand
for basic, specialty and agricultural chemicals; guides Ebitda to about 10-12 billion euros ($12.7
billion), below prior view of 14 billion euros
 LyondellBasell (LYB) rpts Q3 eps $2.51/$12.07B vs. est. $2.30/$11.87B; sees 4Q favorably
affected by La Porte ethylene capacity
 Celanese (CE) to buyback $500M in shares
 Chicago Bridge (CBI) rpts Q3 EPS $1.51/$3.38B vs. est. $1.39/$3.42B
 Hub Group (HUB/B) rpts Q3 eps 49c/$913.4M vs. est. 53c/$919.5M
 Flowserve (FLS) rpts Q3 eps 92c/$1.2B vs. est. 99c/$1.3B; reports Q3 backlog $2.8B, up 10.4%, or
14.1% on constant currency
 Swift Transportation (SWFT) rpts q3 eps 39c/$1.07B vs. est. 35c/$1.10B; said Q3 operating ratio:
90.9% vs 91.8% YoY
 Barnes Group (B) rpts Q3 EPS 64c/$317.66M vs. est. 58c/$311.02M; reports Q3 organic sales up
8%, Q3 operating margin 16%
 Stericycle (SRCL) rpts Q3 EPS $1.08/$667.9M vs. est. $1.06/$662.9M
 Alcoa (AA) to sell ownership 50.3% stake in Mt. Holly aluminum smelter in South Carolina to
Century Aluminum Company for $67.5M
 Dry Ships (DRYS) files automatic common stock shelf
 Forward Air (FWRD) rpts Q3 eps 54c/$201.5M vs. est. 59c/$204.6M
Technology, Media & Telecom
 Amazon.com (AMZN) rpts Q3 eps loss (95c)/$20.6B vs. est. loss (75c)/$20.85B; sees Q4 sales of
$27.3B-$30.3B, below est. $30.9B; sees Q4 operating loss $570M to operating profit $430M (est.
$460.5M)
 Microsoft (MSFT) rpts Q1 EPS 65c/$23.2B vs. est. 55c/$22B; said Q1 unearned revs $22.54Bb, vs.
est. $22.6B
 KLA-Tencor (KLAC) announces special dividend of $16.50 per share; increases stock buyback
program to additional 3.6M shares; rptd Q1 revs $642.9M vs. est. $620.7M
 Pandora (P) rpts Q3 eps 9c/$239.6M vs./ est. 8c/$238.5M; sees 4Q adj. EPS 17c-19c on revs
$273M-$278M vs. est. 17c/$272.8M; said 3Q total listener hours 4.99b, up 25% and 3Q active
listeners 76.5M, up 5.2%
 Juniper (JNPR) reports Q3 EPS 36c/$1.13B vs. est. 35c/$1.13B; approves $1.1B increase to share
repurchase authorization; sees 4Q adj. EPS 28c-32c vs est. 41c; says is planning for “revenue
environment to be challenging.”
 Maxim Integrated (MXIM) rpts Q1 eps 38c/$580M vs. est. 37c/$600.96M; sees q2 revs $540M$580M vs. est. $607.4M
 Altera (ALTR) rpts Q3 EPS 38c/$499.6M vs. est. 37c/$491.41M; sees 4Q revs -2% to -6% QoQ, or
$469.6M-$489.6M vs. est. $486.0M; sees 4Q gross margin 66%-67%
 Freescale Semiconductor (FSL) rpts Q3 EPS 49c/$1.21B vs. est. 42c/$1.21B; sees 4Q gross margin
down ~75bp–100bp q/q; sees Q4 revs $1.075B-$1.125B (est. $1.18B)
 Lattice Semi (LSCC) rpts Q3 eps 8c/$86.6M vs. est. 8c/$89.4M; 3Q gross margin 58.7% from
53.2% YoY; guides Q4 revs 0%-to down 4% QoQ
 Digital River (DRIV) to be acquired by investor group for $840M/$26 per share
http://goo.gl/6hCfBd
 Ingram Micro (IM) rpts Q3 revs $11.24B vs. est. $10.9B; sees Q4 revs up 8%-12%, or $12.77B$13.25B vs. est. $12.44B and sees 4Q adj. EPS 95c-$1.02, vs. est. 97c
 Netgear (NTGR) 3Q EPS 72c/$353.3M vs. est. 51c/$352.7M; sees 4Q revs $335M-$350M, vs. est.
$362.7M
 NetSuite (N) rpts Q3 eps 11c/$143.7M vs. est. 4c/$141.7M
 Constant Contact (CTCT) rpts Q3 EPS 36c/$83.5M vs. est. 33c/$83.53M; says added 50,000 gross
new unique customers in Q3, compared to 50,000 in Q2 and 45,000 in 3Q13
 Synaptics (SYNA) rpts Q1 eps $1.04/$282.7M vs. est. $1.19/$287.9M; sees Q2 revs $415M$450M (cited weaker than expected demand in mobile market in 1Q)
 VeriSign (VRSN) rpts Q3 adj. EPS 70c/$255M vs. est. 69c/$252.86M; said deferred revs on Sept.
30 $893M
 Qlik Technologies (QLIK) Q3 eps 1c/$131.3M vs. est. 0c/$124.2M; sees 4Q EPS 26c-30c vs 34c
 Riverbed Technology (RVBD) sees 4Q adj. EPS 31c-33c on revs $285M-$290M vs. est.
34c/$295.2M
 AMC Networks Inc. (AMCX) acquired a 49.9% stake in BBC America for $200 million, forming an
alliance that will bolster both networks in negotiations with pay-tv carriers
 Foxconn is in preliminary talks to build a factory in northern China that would make high-end
screens for iPhones, the Wall Street Journal reports
 LogMeIn (LOGM) rpts Q3 EPS 32c/$58.1M vs. est. 28c/$56.34M; sees Q4 EPS 32c-33c and revs
above estimates
 Proofpoint (PFPT) Q3 revs $50.3M vs. est. $47.7M and guides Q4 revs above views; raises year
revs and billing outlook above prior forecasts
 Sensient Technologies (SXT) rpts Q3 eps 78c/$364.5M vs. est. 77c/$384M; raises lower end of its
year eps forecast by 3c
 GoPro (GPRO) initiated Underperform and $45 target on: shrinking growth outlook; unrealistic
expectations and valuation
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