Stock Market Futures Slip As Ukraine-Russia Fighting Intensifies; PCE Readings On Tap
U.S. stock futures are declining in early morning trading on Friday. This would continue the trend from yesterday’s whipsaw session on news of Russia commencing its invasion of Ukraine. Despite the broader stock market’s attempt to shake off panic selling losses, the narrative appears to be reversing now. Nevertheless, investors should also take note of the latest set of economic data rolling in today. In particular, the Bureau of Economic Analysis is set to release its monthly personal consumption expenditure (PCE) deflator readings. The likes of which consensus economists are expecting to gain by 0.6% month-over-month. Should this be the case, it would translate to a year-over-year increase of about 6%.
To put things into perspective, this would be its fastest increase since 1982, further supporting the soaring inflation narrative. Commenting on this is Allan Boomer, the chief investment officer over at Momentum Advisors. Boomer argues that the Fed remains the biggest headwind for markets in the mid-term. He adds, “And if anything, this Russian event may make the Fed a bit less hawkish.” While investors continue watching all these developing factors, there is plenty of stock market news today as well. As of 5:22 a.m. ET, the Dow, S&P 500, and Nasdaq futures are trading lower by 0.55%, 0.55%, and 0.43% respectively.
Block (SQ) Stock Soars After Topping Quarterly Estimates In Q4 Earnings Update
Block (NYSE: SQ) is one of the biggest premarket movers in the stock market today. This comes as the fintech goliath continues to gain momentum across its portfolio. Evidently, the company’s latest quarterly earnings figures are above Wall Street’s estimates. In detail, Block is currently looking at an earnings per share of $0.27 on revenue of $4.08 billion. For reference, this is versus consensus projections of $0.22 and $4.06 billion respectively. Regarding year-over-year changes, Block’s revenue is up 29% while earnings per share is down by 15%. Not to mention, the company also notes that excluding Bitcoin-related transaction revenue, its total revenue sits at $2.12 billion, a 51% year-over-year increase. By extension, this means that Block’s earnings from Bitcoin transactions add up to almost $2 billion.
Sure, fintech stocks may have lost some momentum over the past few months. However, major players like Block continue to deliver when it comes to fintech services. All of this adds up to the company seeing a gross payment volume (GPV) of $46.3 billion for the quarter. Following this overall solid performance, Block appears optimistic moving forward. It is currently guiding for its GPV to rise by 35% in the current quarter alongside continued growth in Cash App gross profit. Moreover, it is also important to consider that revenue from Block’s Afterpay acquisition will also be accounted for as well. As it stands, SQ stock is currently gaining by over 15% in pre-market trading today.
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Etsy Surges On Latest Quarterly Earnings Beat; Offers Cautious Outlook
At the same time, Etsy (NASDAQ: ETSY) also appears to be on a roll after posting stellar financials. In its fourth fiscal quarter update yesterday, the company reported earnings of $1.11 per share, handily beating consensus estimates of $0.79. Additionally, Etsy is also looking at a total revenue of $717 million for the quarter. This is above Wall Street’s expectations of $685 million. Throughout the quarter, Etsy served up to 96.3 million active buyers, also above forecasts of 95.6 million. For year-over-year comparisons, the company’s revenue growth does appear to be normalizing. Revenue is up 16% year-over-year, this would be a tough contrast from its sales growth of over 100% in 2020.
Overall, the current round of results seems to have investors keen on ETSY stock today. This is even in spite of Etsy’s conservative guidance for its first fiscal quarter. To point out, the company is guiding for a revenue of between $565 million and $590 million this quarter. This is versus initial analyst expectations of $630 million. Similarly, Etsy’s guidance for gross merchandise sales (GMS) is currently in the range of $3.2 billion and $3.4 billion. Even on the higher end, it would be just shy of consensus approximations of $3.5 billion.
Providing some insight into the company’s conservative outlook is CFO Rachel Glaser. She says, “Even without the significant tailwinds of stimulus checks and lockdowns, our first quarter 2022 guidance reflects our expectation that we will keep all of the gains made in 2021 – indicating our belief in the durability of the last two years’ growth.” With all this in mind, I could see the appeal of ETSY stock now.
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AMD Announces $8 Billion Share Buyback Plan
Elsewhere, semiconductor titan Advanced Micro Devices (NASDAQ: AMD) is making moves as well. Namely, AMD stock could be worth noting in the stock market today following its latest announcement. Yesterday, the company approved a massive $8 billion share repurchase program. To highlight, this would be on top of its current $4 billion buyback plans announced back in May 2021. The likes of which AMD has already repurchased about $3 billion worth in shares so far.
According to AMD, the latest share buyback program is to “return value to shareholders.” Naturally, this would be the company’s attempt to offset stock dilution from stock issuances and reduce share count. Furthermore, AMD is also planning to fund the current repurchase via cash it generates from general operations. Providing detail on the timing of these share buybacks is CEO Dr. Lisa Su. She notes, “We are pleased to expand our share repurchase program based on the strength of our balance sheet and expectations for future free cash flow generation.” With AMD seemingly confident about its long-term growth prospects, investors could be eyeing AMD stock at today’s opening bell.
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Occidental Petroleum Offers Massive Dividend Increase; Tops Earnings Estimates Across The Board
In other earnings-related news, Occidental Petroleum (NYSE: OXY) could be in focus now. For the most part, this would be thanks to its latest quarterly earnings report and subsequent announcements. For starters, the company is likely already gaining attention from the recent movement in energy prices relating to Ukraine-Russia skirmishes. After all, it primarily specializes in hydrocarbon exploration. If that wasn’t enough, Occidental also has operations spanning the U.S., the Middle East, and Colombia. Now, even as oil prices fluctuate from news of international sanctions possibly impacting energy market exports, Occidental is pressing forward.
In fact, the company posted an earnings per share of $1.48 on revenue of $8.01 billion. This is well above consensus forecasts of $1.10 and $7.39 billion respectively. More importantly, CEO Vicki Hollub highlights that Occidental’s focus on operational efficiencies is to thank for the solid quarter. This alongside increases in commodity prices helped the company improve its balance sheet and liquidity position. Also, Occidental is increasing its quarterly dividend to $0.13 per share, a sizable increase of 1,200% from its previous payout. While the energy industry continues to steal headlines, OXY stock could follow suit later today.
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