Forex Forecast FXStreet

Trading economic news

The majority of this sub is focused on technical analysis. I regularly ridicule such "tea leaf readers" and advocate for trading based on fundamentals and economic news instead, so I figured I should take the time to write up something on how exactly you can trade economic news releases.
This post is long as balls so I won't be upset if you get bored and go back to your drooping dick patterns or whatever.

How economic news is released

First, it helps to know how economic news is compiled and released. Let's take Initial Jobless Claims, the number of initial claims for unemployment benefits around the United States from Sunday through Saturday. Initial in this context means the first claim for benefits made by an individual during a particular stretch of unemployment. The Initial Jobless Claims figure appears in the Department of Labor's Unemployment Insurance Weekly Claims Report, which compiles information from all of the per-state departments that report to the DOL during the week. A typical number is between 100k and 250k and it can vary quite significantly week-to-week.
The Unemployment Insurance Weekly Claims Report contains data that lags 5 days behind. For example, the Report issued on Thursday March 26th 2020 contained data about the week ending on Saturday March 21st 2020.
In the days leading up to the Report, financial companies will survey economists and run complicated mathematical models to forecast the upcoming Initial Jobless Claims figure. The results of surveyed experts is called the "consensus"; specific companies, experts, and websites will also provide their own forecasts. Different companies will release different consensuses. Usually they are pretty close (within 2-3k), but for last week's record-high Initial Jobless Claims the reported consensuses varied by up to 1M! In other words, there was essentially no consensus.
The Unemployment Insurance Weekly Claims Report is released each Thursday morning at exactly 8:30 AM ET. (On Thanksgiving the Report is released on Wednesday instead.) Media representatives gather at the Frances Perkins Building in Washington DC and are admitted to the "lockup" at 8:00 AM ET. In order to be admitted to the lockup you have to be a credentialed member of a media organization that has signed the DOL lockup agreement. The lockup room is small so there is a limited number of spots.
No phones are allowed. Reporters bring their laptops and connect to a local network; there is a master switch on the wall that prevents/enables Internet connectivity on this network. Once the doors are closed the Unemployment Insurance Weekly Claims Report is distributed, with a heading that announces it is "embargoed" (not to be released) prior to 8:30 AM. Reporters type up their analyses of the report, including extracting key figures like Initial Jobless Claims. They load their write-ups into their companies' software, which prepares to send it out as soon as Internet is enabled. At 8:30 AM the DOL representative in the room flips the wall switch and all of the laptops are connected to the Internet, releasing their write-ups to their companies and on to their companies' partners.
Many of those media companies have externally accessible APIs for distributing news. Media aggregators and squawk services (like RanSquawk and TradeTheNews) subscribe to all of these different APIs and then redistribute the key economic figures from the Report to their own subscribers within one second after Internet is enabled in the DOL lockup.
Some squawk services are text-based while others are audio-based. FinancialJuice.com provides a free audio squawk service; internally they have a paid subscription to a professional squawk service and they simply read out the latest headlines to their own listeners, subsidized by ads on the site. I've been using it for 4 months now and have been pretty happy. It usually lags behind the official release times by 1-2 seconds and occasionally they verbally flub the numbers or stutter and have to repeat, but you can't beat the price!
Important - I’m not affiliated with FinancialJuice and I’m not advocating that you use them over any other squawk. If you use them and they misspeak a number and you lose all your money don’t blame me. If anybody has any other free alternatives please share them!

How the news affects forex markets

Institutional forex traders subscribe to these squawk services and use custom software to consume the emerging data programmatically and then automatically initiate trades based on the perceived change to the fundamentals that the figures represent.
It's important to note that every institution will have "priced in" their own forecasted figures well in advance of an actual news release. Forecasts and consensuses all come out at different times in the days leading up to a news release, so by the time the news drops everybody is really only looking for an unexpected result. You can't really know what any given institution expects the value to be, but unless someone has inside information you can pretty much assume that the market has collectively priced in the experts' consensus. When the news comes out, institutions will trade based on the difference between the actual and their forecast.
Sometimes the news reflects a real change to the fundamentals with an economic effect that will change the demand for a currency, like an interest rate decision. However, in the case of the Initial Jobless Claims figure, which is a backwards-looking metric, trading is really just self-fulfilling speculation that market participants will buy dollars when unemployment is low and sell dollars when unemployment is high. Generally speaking, news that reflects a real economic shift has a bigger effect than news that only matters to speculators.
Massive and extremely fast news-based trades happen within tenths of a second on the ECNs on which institutional traders are participants. Over the next few seconds the resulting price changes trickle down to retail traders. Some economic news, like Non Farm Payroll Employment, has an effect that can last minutes to hours as "slow money" follows behind on the trend created by the "fast money". Other news, like Initial Jobless Claims, has a short impact that trails off within a couple minutes and is subsequently dwarfed by the usual pseudorandom movements in the market.
The bigger the difference between actual and consensus, the bigger the effect on any given currency pair. Since economic news releases generally relate to a single currency, the biggest and most easily predicted effects are seen on pairs where one currency is directly effected and the other is not affected at all. Personally I trade USD/JPY because the time difference between the US and Japan ensures that no news will be coming out of Japan at the same time that economic news is being released in the US.
Before deciding to trade any particular news release you should measure the historical correlation between the release (specifically, the difference between actual and consensus) and the resulting short-term change in the currency pair. Historical data for various news releases (along with historical consensus data) is readily available. You can pay to get it exported into Excel or whatever, or you can scroll through it for free on websites like TradingEconomics.com.
Let's look at two examples: Initial Jobless Claims and Non Farm Payroll Employment (NFP). I collected historical consensuses and actuals for these releases from January 2018 through the present, measured the "surprise" difference for each, and then correlated that to short-term changes in USD/JPY at the time of release using 5 second candles.
I omitted any releases that occurred simultaneously as another major release. For example, occasionally the monthly Initial Jobless Claims comes out at the exact same time as the monthly Balance of Trade figure, which is a more significant economic indicator and can be expected to dwarf the effect of the Unemployment Insurance Weekly Claims Report.
USD/JPY correlation with Initial Jobless Claims (2018 - present)
USD/JPY correlation with Non Farm Payrolls (2018 - present)
The horizontal axes on these charts is the duration (in seconds) after the news release over which correlation was calculated. The vertical axis is the Pearson correlation coefficient: +1 means that the change in USD/JPY over that duration was perfectly linearly correlated to the "surprise" in the releases; -1 means that the change in USD/JPY was perfectly linearly correlated but in the opposite direction, and 0 means that there is no correlation at all.
For Initial Jobless Claims you can see that for the first 30 seconds USD/JPY is strongly negatively correlated with the difference between consensus and actual jobless claims. That is, fewer-than-forecast jobless claims (fewer newly unemployed people than expected) strengthens the dollar and greater-than-forecast jobless claims (more newly unemployed people than expected) weakens the dollar. Correlation then trails off and changes to a moderate/weak positive correlation. I interpret this as algorithms "buying the dip" and vice versa, but I don't know for sure. From this chart it appears that you could profit by opening a trade for 15 seconds (duration with strongest correlation) that is long USD/JPY when Initial Jobless Claims is lower than the consensus and short USD/JPY when Initial Jobless Claims is higher than expected.
The chart for Non Farm Payroll looks very different. Correlation is positive (higher-than-expected payrolls strengthen the dollar and lower-than-expected payrolls weaken the dollar) and peaks at around 45 seconds, then slowly decreases as time goes on. This implies that price changes due to NFP are quite significant relative to background noise and "stick" even as normal fluctuations pick back up.
I wanted to show an example of what the USD/JPY S5 chart looks like when an "uncontested" (no other major simultaneously news release) Initial Jobless Claims and NFP drops, but unfortunately my broker's charts only go back a week. (I can pull historical data going back years through the API but to make it into a pretty chart would be a bit of work.) If anybody can get a 5-second chart of USD/JPY at March 19, 2020, UTC 12:30 and/or at February 7, 2020, UTC 13:30 let me know and I'll add it here.

Backtesting

So without too much effort we determined that (1) USD/JPY is strongly negatively correlated with the Initial Jobless Claims figure for the first 15 seconds after the release of the Unemployment Insurance Weekly Claims Report (when no other major news is being released) and also that (2) USD/JPY is strongly positively correlated with the Non Farms Payroll figure for the first 45 seconds after the release of the Employment Situation report.
Before you can assume you can profit off the news you have to backtest and consider three important parameters.
Entry speed: How quickly can you realistically enter the trade? The correlation performed above was measured from the exact moment the news was released, but realistically if you've got your finger on the trigger and your ear to the squawk it will take a few seconds to hit "Buy" or "Sell" and confirm. If 90% of the price move happens in the first second you're SOL. For back-testing purposes I assume a 5 second delay. In practice I use custom software that opens a trade with one click, and I can reliably enter a trade within 2-3 seconds after the news drops, using the FinancialJuice free squawk.
Minimum surprise: Should you trade every release or can you do better by only trading those with a big enough "surprise" factor? Backtesting will tell you whether being more selective is better long-term or not.
Hold time: The optimal time to hold the trade is not necessarily the same as the time of maximum correlation. That's a good starting point but it's not necessarily the best number. Backtesting each possible hold time will let you find the best one.
The spread: When you're only holding a position open for 30 seconds, the spread will kill you. The correlations performed above used the midpoint price, but in reality you have to buy at the ask and sell at the bid. Brokers aren't stupid and the moment volume on the ECN jumps they will widen the spread for their retail customers. The only way to determine if the news-driven price movements reliably overcome the spread is to backtest.
Stops: Personally I don't use stops, neither take-profit nor stop-loss, since I'm automatically closing the trade after a fixed (and very short) amount of time. Additionally, brokers have a minimum stop distance; the profits from scalping the news are so slim that even the nearest stops they allow will generally not get triggered.
I backtested trading these two news releases (since 2018), using a 5 second entry delay, real historical spreads, and no stops, cycling through different "surprise" thresholds and hold times to find the combination that returns the highest net profit. It's important to maximize net profit, not expected value per trade, so you don't over-optimize and reduce the total number of trades taken to one single profitable trade. If you want to get fancy you can set up a custom metric that combines number of trades, expected value, and drawdown into a single score to be maximized.
For the Initial Jobless Claims figure I found that the best combination is to hold trades open for 25 seconds (that is, open at 5 seconds elapsed and hold until 30 seconds elapsed) and only trade when the difference between consensus and actual is 7k or higher. That leads to 30 trades taken since 2018 and an expected return of... drumroll please... -0.0093 yen per unit per trade.
Yep, that's a loss of approx. $8.63 per lot.
Disappointing right? That's the spread and that's why you have to backtest. Even though the release of the Unemployment Insurance Weekly Claims Report has a strong correlation with movement in USD/JPY, it's simply not something that a retail trader can profit from.
Let's turn to the NFP. There I found that the best combination is to hold trades open for 75 seconds (that is, open at 5 seconds elapsed and hold until 80 seconds elapsed) and trade every single NFP (no minimum "surprise" threshold). That leads to 20 trades taken since 2018 and an expected return of... drumroll please... +0.1306 yen per unit per trade.
That's a profit of approx. $121.25 per lot. Not bad for 75 seconds of work! That's a +6% ROI at 50x leverage.

Make it real

If you want to do this for realsies, you need to run these numbers for all of the major economic news releases. Markit Manufacturing PMI, Factory Orders MoM, Trade Balance, PPI MoM, Export and Import Prices, Michigan Consumer Sentiment, Retail Sales MoM, Industrial Production MoM, you get the idea. You keep a list of all of the releases you want to trade, when they are released, and the ideal hold time and "surprise" threshold. A few minutes before the prescribed release time you open up your broker's software, turn on your squawk, maybe jot a few notes about consensuses and model forecasts, and get your finger on the button. At the moment you hear the release you open the trade in the correct direction, hold it (without looking at the chart!) for the required amount of time, then close it and go on with your day.
Some benefits of trading this way: * Most major economic releases come out at either 8:30 AM ET or 10:00 AM ET, and then you're done for the day. * It's easily backtestable. You can look back at the numbers and see exactly what to expect your return to be. * It's fun! Packing your trading into 30 seconds and knowing that institutions are moving billions of dollars around as fast as they can based on the exact same news you just read is thrilling. * You can wow your friends by saying things like "The St. Louis Fed had some interesting remarks on consumer spending in the latest Beige Book." * No crayons involved.
Some downsides: * It's tricky to be fast enough without writing custom software. Some broker software is very slow and requires multiple dialog boxes before a position is opened, which won't cut it. * The profits are very slim, you're not going to impress your instagram followers to join your expensive trade copying service with your 30-second twice-weekly trades. * Any friends you might wow with your boring-ass economic talking points are themselves the most boring people in the world.
I hope you enjoyed this long as fuck post and you give trading economic news a try!
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The World This Week 10th July 2020 – 17th July 2020

Indian Equity Summary-
· Sensex ended higher by 1.2 percent as the bullish trend persisted for the fifth consecutive week in the domestic equity market ,on the back ofØ positive global cues and optimism over the development of Covid-19 vaccine .The focus is now turning to Q1FY21 earning season and more importantly for guidance and viewpoints of management.
· Going forward, global factors like development on the US -China relationship front , any resurgence of Covid-19 cases globally, as economiesØ have started opening up ; will continue to dictate the trend of the domestic equity market. We expect the trading range for Nifty between 10800-11200 in the near term.
Indian Debt Market-
· The bond prices fell as the yield on the latest 10-year benchmark 5.79% 2030 paper settled at 5.80% on Jul 17 compared with 5.76% on Jul 10.Ø
· Reserve Bank of India announces the auction of three Government of India 91day, 182 day and 364 day Treasury Bills for an aggregate amount ofØ ₹35,000, to be conducted on 22nd July 2020.
· State Governments announced to sell securities by way of an auction to be conducted on 21th July 2020, for an aggregate face value of ₹ 9,000 Cr.Ø
· We expect that RBI will be in wait and watch mood before taking any major decision of rate cut on the back of recent inflation print.Ø
· We expect the 10 year benchmark yield to trade between 5.80-6.05% in near term.Ø
Domestic News
· India’s retail trade has suffered a business loss of about Rs 15.5 lakh crore in past 100 days due to the COVID-19 pandemic as per theØ Confederation of All India Traders (CAIT).
· The Foreign Direct Investment (FDI) from the US to India has crossed the $40 billion mark as on year to date, reflecting the growing confidence ofØ American companies in the country.
· Forex reserves rose by $3.1 billion on a WoW basis to hit a record high of $516.36 billion for the week ended July 10, according to Reserve BankØ of India (RBI).
· According to the latest data released by the Ministry of StatisticsØ & Programme Implementation (MoSPI), India’s retail inflation(CPI) grew to 6.09% in the month of June as against the prior released figure of 5.84 in April for the month of March.
International News
· Hong Kong's April-June unemployment rises to 6.2%, being the highest in over 15 years.Ø
· Japan’s exports plunged 26.2% in June while Imports fell by 14.4% in June on a year on year basis , as per the data released byØ Ministry of Finance (MOF).
· Foreign direct investment (FDI) into China fell 1.3% in the first half of this year from a year earlier to 472.18 billion yuan ($67.47Ø billion)as per China’s commerce ministry.
· Gross domestic product (GDP) of China rose to 3.2% in the second-quarter from a year earlier as per the National Bureau ofØ Statistics, faster than the 2.5% forecast by analysts in a Reuters poll, with the easing of lockdown measures and ramping up of stimulus by policymakers to combat the virus-led downturn.
· US GDP is expected to contract by an annualised rate of 37% in the Q2 2020 and by 6.6%for 2020 as a whole as per theØ International Monetary Fund (IMF) staff.
Link - http://www.karvywealth.com/data/sites/1/skins/karvywealth/Download_media_report.aspx?FileName=B98EB615-C7D5-409D-AFF1-05C92C06DBE4|5234282
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Hibiscus Petroleum Berhad (5199.KL)


https://preview.redd.it/gp18bjnlabr41.jpg?width=768&format=pjpg&auto=webp&s=6054e7f52e8d52da403016139ae43e0e799abf15
Download PDF of this article here: https://docdro.id/6eLgUPo
In light of the recent fall in oil prices due to the Saudi-Russian dispute and dampening demand for oil due to the lockdowns implemented globally, O&G stocks have taken a severe beating, falling approximately 50% from their highs at the beginning of the year. Not spared from this onslaught is Hibiscus Petroleum Berhad (Hibiscus), a listed oil and gas (O&G) exploration and production (E&P) company.
Why invest in O&G stocks in this particularly uncertain period? For one, valuations of these stocks have fallen to multi-year lows, bringing the potential ROI on these stocks to attractive levels. Oil prices are cyclical, and are bound to return to the mean given a sufficiently long time horizon. The trick is to find those companies who can survive through this downturn and emerge into “normal” profitability once oil prices rebound.
In this article, I will explore the upsides and downsides of investing in Hibiscus. I will do my best to cater this report to newcomers to the O&G industry – rather than address exclusively experts and veterans of the O&G sector. As an equity analyst, I aim to provide a view on the company primarily, and will generally refrain from providing macro views on oil or opinions about secular trends of the sector. I hope you enjoy reading it!
Stock code: 5199.KL
Stock name: Hibiscus Petroleum Berhad
Financial information and financial reports: https://www.malaysiastock.biz/Corporate-Infomation.aspx?securityCode=5199
Company website: https://www.hibiscuspetroleum.com/

Company Snapshot

Hibiscus Petroleum Berhad (5199.KL) is an oil and gas (O&G) upstream exploration and production (E&P) company located in Malaysia. As an E&P company, their business can be basically described as:
· looking for oil,
· drawing it out of the ground, and
· selling it on global oil markets.
This means Hibiscus’s profits are particularly exposed to fluctuating oil prices. With oil prices falling to sub-$30 from about $60 at the beginning of the year, Hibiscus’s stock price has also fallen by about 50% YTD – from around RM 1.00 to RM 0.45 (as of 5 April 2020).
https://preview.redd.it/3dqc4jraabr41.png?width=641&format=png&auto=webp&s=7ba0e8614c4e9d781edfc670016a874b90560684
https://preview.redd.it/lvdkrf0cabr41.png?width=356&format=png&auto=webp&s=46f250a713887b06986932fa475dc59c7c28582e
While the company is domiciled in Malaysia, its two main oil producing fields are located in both Malaysia and the UK. The Malaysian oil field is commonly referred to as the North Sabah field, while the UK oil field is commonly referred to as the Anasuria oil field. Hibiscus has licenses to other oil fields in different parts of the world, notably the Marigold/Sunflower oil fields in the UK and the VIC cluster in Australia, but its revenues and profits mainly stem from the former two oil producing fields.
Given that it’s a small player and has only two primary producing oil fields, it’s not surprising that Hibiscus sells its oil to a concentrated pool of customers, with 2 of them representing 80% of its revenues (i.e. Petronas and BP). Fortunately, both these customers are oil supermajors, and are unlikely to default on their obligations despite low oil prices.
At RM 0.45 per share, the market capitalization is RM 714.7m and it has a trailing PE ratio of about 5x. It doesn’t carry any debt, and it hasn’t paid a dividend in its listing history. The MD, Mr. Kenneth Gerard Pereira, owns about 10% of the company’s outstanding shares.

Reserves (Total recoverable oil) & Production (bbl/day)

To begin analyzing the company, it’s necessary to understand a little of the industry jargon. We’ll start with Reserves and Production.
In general, there are three types of categories for a company’s recoverable oil volumes – Reserves, Contingent Resources and Prospective Resources. Reserves are those oil fields which are “commercial”, which is defined as below:
As defined by the SPE PRMS, Reserves are “… quantities of petroleum anticipated to be commercially recoverable by application of development projects to known accumulations from a given date forward under defined conditions.” Therefore, Reserves must be discovered (by drilling, recoverable (with current technology), remaining in the subsurface (at the effective date of the evaluation) and “commercial” based on the development project proposed.)
Note that Reserves are associated with development projects. To be considered as “commercial”, there must be a firm intention to proceed with the project in a reasonable time frame (typically 5 years, and such intention must be based upon all of the following criteria:)
- A reasonable assessment of the future economics of the development project meeting defined investment and operating criteria; - A reasonable expectation that there will be a market for all or at least the expected sales quantities of production required to justify development; - Evidence that the necessary production and transportation facilities are available or can be made available; and - Evidence that legal, contractual, environmental and other social and economic concerns will allow for the actual implementation of the recovery project being evaluated.
Contingent Resources and Prospective Resources are further defined as below:
- Contingent Resources: potentially recoverable volumes associated with a development plan that targets discovered volumes but is not (yet commercial (as defined above); and) - Prospective Resources: potentially recoverable volumes associated with a development plan that targets as yet undiscovered volumes.
In the industry lingo, we generally refer to Reserves as ‘P’ and Contingent Resources as ‘C’. These ‘P’ and ‘C’ resources can be further categorized into 1P/2P/3P resources and 1C/2C/3C resources, each referring to a low/medium/high estimate of the company’s potential recoverable oil volumes:
- Low/1C/1P estimate: there should be reasonable certainty that volumes actually recovered will equal or exceed the estimate; - Best/2C/2P estimate: there should be an equal likelihood of the actual volumes of petroleum being larger or smaller than the estimate; and - High/3C/3P estimate: there is a low probability that the estimate will be exceeded.
Hence in the E&P industry, it is easy to see why most investors and analysts refer to the 2P estimate as the best estimate for a company’s actual recoverable oil volumes. This is because 2P reserves (‘2P’ referring to ‘Proved and Probable’) are a middle estimate of the recoverable oil volumes legally recognized as “commercial”.
However, there’s nothing stopping you from including 2C resources (riskier) or utilizing 1P resources (conservative) as your estimate for total recoverable oil volumes, depending on your risk appetite. In this instance, the company has provided a snapshot of its 2P and 2C resources in its analyst presentation:
https://preview.redd.it/o8qejdyc8br41.png?width=710&format=png&auto=webp&s=b3ab9be8f83badf0206adc982feda3a558d43e78
Basically, what the company is saying here is that by 2021, it will have classified as 2P reserves at least 23.7 million bbl from its Anasuria field and 20.5 million bbl from its North Sabah field – for total 2P reserves of 44.2 million bbl (we are ignoring the Australian VIC cluster as it is only estimated to reach first oil by 2022).
Furthermore, the company is stating that they have discovered (but not yet legally classified as “commercial”) a further 71 million bbl of oil from both the Anasuria and North Sabah fields, as well as the Marigold/Sunflower fields. If we include these 2C resources, the total potential recoverable oil volumes could exceed 100 million bbl.
In this report, we shall explore all valuation scenarios giving consideration to both 2P and 2C resources.
https://preview.redd.it/gk54qplf8br41.png?width=489&format=png&auto=webp&s=c905b7a6328432218b5b9dfd53cc9ef1390bd604
The company further targets a 2021 production rate of 20,000 bbl (LTM: 8,000 bbl), which includes 5,000 bbl from its Anasuria field (LTM: 2,500 bbl) and 7,000 bbl from its North Sabah field (LTM: 5,300 bbl).
This is a substantial increase in forecasted production from both existing and prospective oil fields. If it materializes, annual production rate could be as high as 7,300 mmbbl, and 2021 revenues (given FY20 USD/bbl of $60) could exceed RM 1.5 billion (FY20: RM 988 million).
However, this targeted forecast is quite a stretch from current production levels. Nevertheless, we shall consider all provided information in estimating a valuation for Hibiscus.
To understand Hibiscus’s oil production capacity and forecast its revenues and profits, we need to have a better appreciation of the performance of its two main cash-generating assets – the North Sabah field and the Anasuria field.

North Sabah oil field
https://preview.redd.it/62nssexj8br41.png?width=1003&format=png&auto=webp&s=cd78f86d51165fb9a93015e49496f7f98dad64dd
Hibiscus owns a 50% interest in the North Sabah field together with its partner Petronas, and has production rights over the field up to year 2040. The asset contains 4 oil fields, namely the St Joseph field, South Furious field, SF 30 field and Barton field.
For the sake of brevity, we shall not delve deep into the operational aspects of the fields or the contractual nature of its production sharing contract (PSC). We’ll just focus on the factors which relate to its financial performance. These are:
· Average uptime
· Total oil sold
· Average realized oil price
· Average OPEX per bbl
With regards to average uptime, we can see that the company maintains relative high facility availability, exceeding 90% uptime in all quarters of the LTM with exception of Jul-Sep 2019. The dip in average uptime was due to production enhancement projects and maintenance activities undertaken to improve the production capacity of the St Joseph and SF30 oil fields.
Hence, we can conclude that management has a good handle on operational performance. It also implies that there is little room for further improvement in production resulting from increased uptime.
As North Sabah is under a production sharing contract (PSC), there is a distinction between gross oil production and net oil production. The former relates to total oil drawn out of the ground, whereas the latter refers to Hibiscus’s share of oil production after taxes, royalties and expenses are accounted for. In this case, we want to pay attention to net oil production, not gross.
We can arrive at Hibiscus’s total oil sold for the last twelve months (LTM) by adding up the total oil sold for each of the last 4 quarters. Summing up the figures yields total oil sold for the LTM of approximately 2,075,305 bbl.
Then, we can arrive at an average realized oil price over the LTM by averaging the average realized oil price for the last 4 quarters, giving us an average realized oil price over the LTM of USD 68.57/bbl. We can do the same for average OPEX per bbl, giving us an average OPEX per bbl over the LTM of USD 13.23/bbl.
Thus, we can sum up the above financial performance of the North Sabah field with the following figures:
· Total oil sold: 2,075,305 bbl
· Average realized oil price: USD 68.57/bbl
· Average OPEX per bbl: USD 13.23/bbl

Anasuria oil field
https://preview.redd.it/586u4kfo8br41.png?width=1038&format=png&auto=webp&s=7580fc7f7df7e948754d025745a5cf47d4393c0f
Doing the same exercise as above for the Anasuria field, we arrive at the following financial performance for the Anasuria field:
· Total oil sold: 1,073,304 bbl
· Average realized oil price: USD 63.57/bbl
· Average OPEX per bbl: USD 23.22/bbl
As gas production is relatively immaterial, and to be conservative, we shall only consider the crude oil production from the Anasuria field in forecasting revenues.

Valuation (Method 1)

Putting the figures from both oil fields together, we get the following data:
https://preview.redd.it/7y6064dq8br41.png?width=700&format=png&auto=webp&s=2a4120563a011cf61fc6090e1cd5932602599dc2
Given that we have determined LTM EBITDA of RM 632m, the next step would be to subtract ITDA (interest, tax, depreciation & amortization) from it to obtain estimated LTM Net Profit. Using FY2020’s ITDA of approximately RM 318m as a guideline, we arrive at an estimated LTM Net Profit of RM 314m (FY20: 230m). Given the current market capitalization of RM 714.7m, this implies a trailing LTM PE of 2.3x.
Performing a sensitivity analysis given different oil prices, we arrive at the following net profit table for the company under different oil price scenarios, assuming oil production rate and ITDA remain constant:
https://preview.redd.it/xixge5sr8br41.png?width=433&format=png&auto=webp&s=288a00f6e5088d01936f0217ae7798d2cfcf11f2
From the above exercise, it becomes apparent that Hibiscus has a breakeven oil price of about USD 41.8863/bbl, and has a lot of operating leverage given the exponential rate of increase in its Net Profit with each consequent increase in oil prices.
Considering that the oil production rate (EBITDA) is likely to increase faster than ITDA’s proportion to revenues (fixed costs), at an implied PE of 4.33x, it seems likely that an investment in Hibiscus will be profitable over the next 10 years (with the assumption that oil prices will revert to the mean in the long-term).

Valuation (Method 2)

Of course, there are a lot of assumptions behind the above method of valuation. Hence, it would be prudent to perform multiple methods of valuation and compare the figures to one another.
As opposed to the profit/loss assessment in Valuation (Method 1), another way of performing a valuation would be to estimate its balance sheet value, i.e. total revenues from 2P Reserves, and assign a reasonable margin to it.
https://preview.redd.it/o2eiss6u8br41.png?width=710&format=png&auto=webp&s=03960cce698d9cedb076f3d5f571b3c59d908fa8
From the above, we understand that Hibiscus’s 2P reserves from the North Sabah and Anasuria fields alone are approximately 44.2 mmbbl (we ignore contribution from Australia’s VIC cluster as it hasn’t been developed yet).
Doing a similar sensitivity analysis of different oil prices as above, we arrive at the following estimated total revenues and accumulated net profit:
https://preview.redd.it/h8hubrmw8br41.png?width=450&format=png&auto=webp&s=6d23f0f9c3dafda89e758b815072ba335467f33e
Let’s assume that the above average of RM 9.68 billion in total realizable revenues from current 2P reserves holds true. If we assign a conservative Net Profit margin of 15% (FY20: 23%; past 5 years average: 16%), we arrive at estimated accumulated Net Profit from 2P Reserves of RM 1.452 billion. Given the current market capitalization of RM 714 million, we might be able to say that the equity is worth about twice the current share price.
However, it is understandable that some readers might feel that the figures used in the above estimate (e.g. net profit margin of 15%) were randomly plucked from the sky. So how do we reconcile them with figures from the financial statements? Fortunately, there appears to be a way to do just that.
Intangible Assets
I refer you to a figure in the financial statements which provides a shortcut to the valuation of 2P Reserves. This is the carrying value of Intangible Assets on the Balance Sheet.
As of 2QFY21, that amount was RM 1,468,860,000 (i.e. RM 1.468 billion).
https://preview.redd.it/hse8ttb09br41.png?width=881&format=png&auto=webp&s=82e48b5961c905fe9273cb6346368de60202ebec
Quite coincidentally, one might observe that this figure is dangerously close to the estimated accumulated Net Profit from 2P Reserves of RM 1.452 billion we calculated earlier. But why would this amount matter at all?
To answer that, I refer you to the notes of the Annual Report FY20 (AR20). On page 148 of the AR20, we find the following two paragraphs:
E&E assets comprise of rights and concession and conventional studies. Following the acquisition of a concession right to explore a licensed area, the costs incurred such as geological and geophysical surveys, drilling, commercial appraisal costs and other directly attributable costs of exploration and appraisal including technical and administrative costs, are capitalised as conventional studies, presented as intangible assets.
E&E assets are assessed for impairment when facts and circumstances suggest that the carrying amount of an E&E asset may exceed its recoverable amount. The Group will allocate E&E assets to cash generating unit (“CGU”s or groups of CGUs for the purpose of assessing such assets for impairment. Each CGU or group of units to which an E&E asset is allocated will not be larger than an operating segment as disclosed in Note 39 to the financial statements.)
Hence, we can determine that firstly, the intangible asset value represents capitalized costs of acquisition of the oil fields, including technical exploration costs and costs of acquiring the relevant licenses. Secondly, an impairment review will be carried out when “the carrying amount of an E&E asset may exceed its recoverable amount”, with E&E assets being allocated to “cash generating units” (CGU) for the purposes of assessment.
On page 169 of the AR20, we find the following:
Carrying amounts of the Group’s intangible assets, oil and gas assets and FPSO are reviewed for possible impairment annually including any indicators of impairment. For the purpose of assessing impairment, assets are grouped at the lowest level CGUs for which there is a separately identifiable cash flow available. These CGUs are based on operating areas, represented by the 2011 North Sabah EOR PSC (“North Sabah”, the Anasuria Cluster, the Marigold and Sunflower fields, the VIC/P57 exploration permit (“VIC/P57”) and the VIC/L31 production license (“VIC/L31”).)
So apparently, the CGUs that have been assigned refer to the respective oil producing fields, two of which include the North Sabah field and the Anasuria field. In order to perform the impairment review, estimates of future cash flow will be made by management to assess the “recoverable amount” (as described above), subject to assumptions and an appropriate discount rate.
Hence, what we can gather up to now is that management will estimate future recoverable cash flows from a CGU (i.e. the North Sabah and Anasuria oil fields), compare that to their carrying value, and perform an impairment if their future recoverable cash flows are less than their carrying value. In other words, if estimated accumulated profits from the North Sabah and Anasuria oil fields are less than their carrying value, an impairment is required.
So where do we find the carrying values for the North Sabah and Anasuria oil fields? Further down on page 184 in the AR20, we see the following:
Included in rights and concession are the carrying amounts of producing field licenses in the Anasuria Cluster amounting to RM668,211,518 (2018: RM687,664,530, producing field licenses in North Sabah amounting to RM471,031,008 (2018: RM414,333,116))
Hence, we can determine that the carrying values for the North Sabah and Anasuria oil fields are RM 471m and RM 668m respectively. But where do we find the future recoverable cash flows of the fields as estimated by management, and what are the assumptions used in that calculation?
Fortunately, we find just that on page 185:
17 INTANGIBLE ASSETS (CONTINUED)
(a Anasuria Cluster)
The Directors have concluded that there is no impairment indicator for Anasuria Cluster during the current financial year. In the previous financial year, due to uncertainties in crude oil prices, the Group has assessed the recoverable amount of the intangible assets, oil and gas assets and FPSO relating to the Anasuria Cluster. The recoverable amount is determined using the FVLCTS model based on discounted cash flows (“DCF” derived from the expected cash in/outflow pattern over the production lives.)
The key assumptions used to determine the recoverable amount for the Anasuria Cluster were as follows:
(i Discount rate of 10%;)
(ii Future cost inflation factor of 2% per annum;)
(iii Oil price forecast based on the oil price forward curve from independent parties; and,)
(iv Oil production profile based on the assessment by independent oil and gas reserve experts.)
Based on the assessments performed, the Directors concluded that the recoverable amount calculated based on the valuation model is higher than the carrying amount.
(b North Sabah)
The acquisition of the North Sabah assets was completed in the previous financial year. Details of the acquisition are as disclosed in Note 15 to the financial statements.
The Directors have concluded that there is no impairment indicator for North Sabah during the current financial year.
Here, we can see that the recoverable amount of the Anasuria field was estimated based on a DCF of expected future cash flows over the production life of the asset. The key assumptions used by management all seem appropriate, including a discount rate of 10% and oil price and oil production estimates based on independent assessment. From there, management concludes that the recoverable amount of the Anasuria field is higher than its carrying amount (i.e. no impairment required). Likewise, for the North Sabah field.
How do we interpret this? Basically, what management is saying is that given a 10% discount rate and independent oil price and oil production estimates, the accumulated profits (i.e. recoverable amount) from both the North Sabah and the Anasuria fields exceed their carrying amounts of RM 471m and RM 668m respectively.
In other words, according to management’s own estimates, the carrying value of the Intangible Assets of RM 1.468 billion approximates the accumulated Net Profit recoverable from 2P reserves.
To conclude Valuation (Method 2), we arrive at the following:

Our estimates Management estimates
Accumulated Net Profit from 2P Reserves RM 1.452 billion RM 1.468 billion

Financials

By now, we have established the basic economics of Hibiscus’s business, including its revenues (i.e. oil production and oil price scenarios), costs (OPEX, ITDA), profitability (breakeven, future earnings potential) and balance sheet value (2P reserves, valuation). Moving on, we want to gain a deeper understanding of the 3 statements to anticipate any blind spots and risks. We’ll refer to the financial statements of both the FY20 annual report and the 2Q21 quarterly report in this analysis.
For the sake of brevity, I’ll only point out those line items which need extra attention, and skip over the rest. Feel free to go through the financial statements on your own to gain a better familiarity of the business.
https://preview.redd.it/h689bss79br41.png?width=810&format=png&auto=webp&s=ed47fce6a5c3815dd3d4f819e31f1ce39ccf4a0b
Income Statement
First, we’ll start with the Income Statement on page 135 of the AR20. Revenues are straightforward, as we’ve discussed above. Cost of Sales and Administrative Expenses fall under the jurisdiction of OPEX, which we’ve also seen earlier. Other Expenses are mostly made up of Depreciation & Amortization of RM 115m.
Finance Costs are where things start to get tricky. Why does a company which carries no debt have such huge amounts of finance costs? The reason can be found in Note 8, where it is revealed that the bulk of finance costs relate to the unwinding of discount of provision for decommissioning costs of RM 25m (Note 32).
https://preview.redd.it/4omjptbe9br41.png?width=1019&format=png&auto=webp&s=eaabfc824134063100afa62edfd36a34a680fb60
This actually refers to the expected future costs of restoring the Anasuria and North Sabah fields to their original condition once the oil reserves have been depleted. Accounting standards require the company to provide for these decommissioning costs as they are estimable and probable. The way the decommissioning costs are accounted for is the same as an amortized loan, where the initial carrying value is recognized as a liability and the discount rate applied is reversed each year as an expense on the Income Statement. However, these expenses are largely non-cash in nature and do not necessitate a cash outflow every year (FY20: RM 69m).
Unwinding of discount on non-current other payables of RM 12m relate to contractual payments to the North Sabah sellers. We will discuss it later.
Taxation is another tricky subject, and is even more significant than Finance Costs at RM 161m. In gist, Hibiscus is subject to the 38% PITA (Petroleum Income Tax Act) under Malaysian jurisdiction, and the 30% Petroleum tax + 10% Supplementary tax under UK jurisdiction. Of the RM 161m, RM 41m of it relates to deferred tax which originates from the difference between tax treatment and accounting treatment on capitalized assets (accelerated depreciation vs straight-line depreciation). Nonetheless, what you should take away from this is that the tax expense is a tangible expense and material to breakeven analysis.
Fortunately, tax is a variable expense, and should not materially impact the cash flow of Hibiscus in today’s low oil price environment.
Note: Cash outflows for Tax Paid in FY20 was RM 97m, substantially below the RM 161m tax expense.
https://preview.redd.it/1xrnwzm89br41.png?width=732&format=png&auto=webp&s=c078bc3e18d9c79d9a6fbe1187803612753f69d8
Balance Sheet
The balance sheet of Hibiscus is unexciting; I’ll just bring your attention to those line items which need additional scrutiny. I’ll use the figures in the latest 2Q21 quarterly report (2Q21) and refer to the notes in AR20 for clarity.
We’ve already discussed Intangible Assets in the section above, so I won’t dwell on it again.
Moving on, the company has Equipment of RM 582m, largely relating to O&G assets (e.g. the Anasuria FPSO vessel and CAPEX incurred on production enhancement projects). Restricted cash and bank balances represent contractual obligations for decommissioning costs of the Anasuria Cluster, and are inaccessible for use in operations.
Inventories are relatively low, despite Hibiscus being an E&P company, so forex fluctuations on carrying value of inventories are relatively immaterial. Trade receivables largely relate to entitlements from Petronas and BP (both oil supermajors), and are hence quite safe from impairment. Other receivables, deposits and prepayments are significant as they relate to security deposits placed with sellers of the oil fields acquired; these should be ignored for cash flow purposes.
Note: Total cash and bank balances do not include approximately RM 105 m proceeds from the North Sabah December 2019 offtake (which was received in January 2020)
Cash and bank balances of RM 90m do not include RM 105m of proceeds from offtake received in 3Q21 (Jan 2020). Hence, the actual cash and bank balances as of 2Q21 approximate RM 200m.
Liabilities are a little more interesting. First, I’ll draw your attention to the significant Deferred tax liabilities of RM 457m. These largely relate to the amortization of CAPEX (i.e. Equipment and capitalized E&E expenses), which is given an accelerated depreciation treatment for tax purposes.
The way this works is that the government gives Hibiscus a favorable tax treatment on capital expenditures incurred via an accelerated depreciation schedule, so that the taxable income is less than usual. However, this leads to the taxable depreciation being utilized quicker than accounting depreciation, hence the tax payable merely deferred to a later period – when the tax depreciation runs out but accounting depreciation remains. Given the capital intensive nature of the business, it is understandable why Deferred tax liabilities are so large.
We’ve discussed Provision for decommissioning costs under the Finance Costs section earlier. They are also quite significant at RM 266m.
Notably, the Other Payables and Accruals are a hefty RM 431m. What do they relate to? Basically, they are contractual obligations to the sellers of the oil fields which are only payable upon oil prices reaching certain thresholds. Hence, while they are current in nature, they will only become payable when oil prices recover to previous highs, and are hence not an immediate cash outflow concern given today’s low oil prices.
Cash Flow Statement
There is nothing in the cash flow statement which warrants concern.
Notably, the company generated OCF of approximately RM 500m in FY20 and RM 116m in 2Q21. It further incurred RM 330m and RM 234m of CAPEX in FY20 and 2Q21 respectively, largely owing to production enhancement projects to increase the production rate of the Anasuria and North Sabah fields, which according to management estimates are accretive to ROI.
Tax paid was RM 97m in FY20 and RM 61m in 2Q21 (tax expense: RM 161m and RM 62m respectively).

Risks

There are a few obvious and not-so-obvious risks that one should be aware of before investing in Hibiscus. We shall not consider operational risks (e.g. uptime, OPEX) as they are outside the jurisdiction of the equity analyst. Instead, we shall focus on the financial and strategic risks largely outside the control of management. The main ones are:
· Oil prices remaining subdued for long periods of time
· Fluctuation of exchange rates
· Customer concentration risk
· 2P Reserves being less than estimated
· Significant current and non-current liabilities
· Potential issuance of equity
Oil prices remaining subdued
Of topmost concern in the minds of most analysts is whether Hibiscus has the wherewithal to sustain itself through this period of low oil prices (sub-$30). A quick and dirty estimate of annual cash outflow (i.e. burn rate) assuming a $20 oil world and historical production rates is between RM 50m-70m per year, which considering the RM 200m cash balance implies about 3-4 years of sustainability before the company runs out of cash and has to rely on external assistance for financing.
Table 1: Hibiscus EBITDA at different oil price and exchange rates
https://preview.redd.it/gxnekd6h9br41.png?width=670&format=png&auto=webp&s=edbfb9621a43480d11e3b49de79f61a6337b3d51
The above table shows different EBITDA scenarios (RM ‘m) given different oil prices (left column) and USD:MYR exchange rates (top row). Currently, oil prices are $27 and USD:MYR is 1:4.36.
Given conservative assumptions of average OPEX/bbl of $20 (current: $15), we can safely say that the company will be loss-making as long as oil remains at $20 or below (red). However, we can see that once oil prices hit $25, the company can tank the lower-end estimate of the annual burn rate of RM 50m (orange), while at RM $27 it can sufficiently muddle through the higher-end estimate of the annual burn rate of RM 70m (green).
Hence, we can assume that as long as the average oil price over the next 3-4 years remains above $25, Hibiscus should come out of this fine without the need for any external financing.
Customer Concentration Risk
With regards to customer concentration risk, there is not much the analyst or investor can do except to accept the risk. Fortunately, 80% of revenues can be attributed to two oil supermajors (Petronas and BP), hence the risk of default on contractual obligations and trade receivables seems to be quite diminished.
2P Reserves being less than estimated
2P Reserves being less than estimated is another risk that one should keep in mind. Fortunately, the current market cap is merely RM 714m – at half of estimated recoverable amounts of RM 1.468 billion – so there’s a decent margin of safety. In addition, there are other mitigating factors which shall be discussed in the next section (‘Opportunities’).
Significant non-current and current liabilities
The significant non-current and current liabilities have been addressed in the previous section. It has been determined that they pose no threat to immediate cash flow due to them being long-term in nature (e.g. decommissioning costs, deferred tax, etc). Hence, for the purpose of assessing going concern, their amounts should not be a cause for concern.
Potential issuance of equity
Finally, we come to the possibility of external financing being required in this low oil price environment. While the company should last 3-4 years on existing cash reserves, there is always the risk of other black swan events materializing (e.g. coronavirus) or simply oil prices remaining muted for longer than 4 years.
Furthermore, management has hinted that they wish to acquire new oil assets at presently depressed prices to increase daily production rate to a targeted 20,000 bbl by end-2021. They have room to acquire debt, but they may also wish to issue equity for this purpose. Hence, the possibility of dilution to existing shareholders cannot be entirely ruled out.
However, given management’s historical track record of prioritizing ROI and optimal capital allocation, and in consideration of the fact that the MD owns 10% of outstanding shares, there is some assurance that any potential acquisitions will be accretive to EPS and therefore valuations.

Opportunities

As with the existence of risk, the presence of material opportunities also looms over the company. Some of them are discussed below:
· Increased Daily Oil Production Rate
· Inclusion of 2C Resources
· Future oil prices exceeding $50 and effects from coronavirus dissipating
Increased Daily Oil Production Rate
The first and most obvious opportunity is the potential for increased production rate. We’ve seen in the last quarter (2Q21) that the North Sabah field increased its daily production rate by approximately 20% as a result of production enhancement projects (infill drilling), lowering OPEX/bbl as a result. To vastly oversimplify, infill drilling is the process of maximizing well density by drilling in the spaces between existing wells to improve oil production.
The same improvements are being undertaken at the Anasuria field via infill drilling, subsea debottlenecking, water injection and sidetracking of existing wells. Without boring you with industry jargon, this basically means future production rate is likely to improve going forward.
By how much can the oil production rate be improved by? Management estimates in their analyst presentation that enhancements in the Anasuria field will be able to yield 5,000 bbl/day by 2021 (current: 2,500 bbl/day).
Similarly, improvements in the North Sabah field is expected to yield 7,000 bbl/day by 2021 (current: 5,300 bbl/day).
This implies a total 2021 expected daily production rate from the two fields alone of 12,000 bbl/day (current: 8,000 bbl/day). That’s a 50% increase in yields which we haven’t factored into our valuation yet.
Furthermore, we haven’t considered any production from existing 2C resources (e.g. Marigold/Sunflower) or any potential acquisitions which may occur in the future. By management estimates, this can potentially increase production by another 8,000 bbl/day, bringing total production to 20,000 bbl/day.
While this seems like a stretch of the imagination, it pays to keep them in mind when forecasting future revenues and valuations.
Just to play around with the numbers, I’ve come up with a sensitivity analysis of possible annual EBITDA at different oil prices and daily oil production rates:
Table 2: Hibiscus EBITDA at different oil price and daily oil production rates
https://preview.redd.it/jnpfhr5n9br41.png?width=814&format=png&auto=webp&s=bbe4b512bc17f576d87529651140cc74cde3d159
The left column represents different oil prices while the top row represents different daily oil production rates.
The green column represents EBITDA at current daily production rate of 8,000 bbl/day; the orange column represents EBITDA at targeted daily production rate of 12,000 bbl/day; while the purple column represents EBITDA at maximum daily production rate of 20,000 bbl/day.
Even conservatively assuming increased estimated annual ITDA of RM 500m (FY20: RM 318m), and long-term average oil prices of $50 (FY20: $60), the estimated Net Profit and P/E ratio is potentially lucrative at daily oil production rates of 12,000 bbl/day and above.
2C Resources
Since we’re on the topic of improved daily oil production rate, it bears to pay in mind the relatively enormous potential from Hibiscus’s 2C Resources. North Sabah’s 2C Resources alone exceed 30 mmbbl; while those from the yet undiagnosed Marigold/Sunflower fields also reach 30 mmbbl. Altogether, 2C Resources exceed 70 mmbbl, which dwarfs the 44 mmbbl of 2P Reserves we have considered up to this point in our valuation estimates.
To refresh your memory, 2C Resources represents oil volumes which have been discovered but are not yet classified as “commercial”. This means that there is reasonable certainty of the oil being recoverable, as opposed to simply being in the very early stages of exploration. So, to be conservative, we will imagine that only 50% of 2C Resources are eligible for reclassification to 2P reserves, i.e. 35 mmbbl of oil.
https://preview.redd.it/mto11iz7abr41.png?width=375&format=png&auto=webp&s=e9028ab0816b3d3e25067447f2c70acd3ebfc41a
This additional 35 mmbbl of oil represents an 80% increase to existing 2P reserves. Assuming the daily oil production rate increases similarly by 80%, we will arrive at 14,400 bbl/day of oil production. According to Table 2 above, this would yield an EBITDA of roughly RM 630m assuming $50 oil.
Comparing that estimated EBITDA to FY20’s actual EBITDA:
FY20 FY21 (incl. 2C) Difference
Daily oil production (bbl/day) 8,626 14,400 +66%
Average oil price (USD/bbl) $68.57 $50 -27%
Average OPEX/bbl (USD) $16.64 $20 +20%
EBITDA (RM ‘m) 632 630 -
Hence, even conservatively assuming lower oil prices and higher OPEX/bbl (which should decrease in the presence of higher oil volumes) than last year, we get approximately the same EBITDA as FY20.
For the sake of completeness, let’s assume that Hibiscus issues twice the no. of existing shares over the next 10 years, effectively diluting shareholders by 50%. Even without accounting for the possibility of the acquisition of new oil fields, at the current market capitalization of RM 714m, the prospective P/E would be about 10x. Not too shabby.
Future oil prices exceeding $50 and effects from coronavirus dissipating
Hibiscus shares have recently been hit by a one-two punch from oil prices cratering from $60 to $30, as a result of both the Saudi-Russian dispute and depressed demand for oil due to coronavirus. This has massively increased supply and at the same time hugely depressed demand for oil (due to the globally coordinated lockdowns being implemented).
Given a long enough timeframe, I fully expect OPEC+ to come to an agreement and the economic effects from the coronavirus to dissipate, allowing oil prices to rebound. As we equity investors are aware, oil prices are cyclical and are bound to recover over the next 10 years.
When it does, valuations of O&G stocks (including Hibiscus’s) are likely to improve as investors overshoot expectations and begin to forecast higher oil prices into perpetuity, as they always tend to do in good times. When that time arrives, Hibiscus’s valuations are likely to become overoptimistic as all O&G stocks tend to do during oil upcycles, resulting in valuations far exceeding reasonable estimates of future earnings. If you can hold the shares up until then, it’s likely you will make much more on your investment than what we’ve been estimating.

Conclusion

Wrapping up what we’ve discussed so far, we can conclude that Hibiscus’s market capitalization of RM 714m far undershoots reasonable estimates of fair value even under conservative assumptions of recoverable oil volumes and long-term average oil prices. As a value investor, I hesitate to assign a target share price, but it’s safe to say that this stock is worth at least RM 1.00 (current: RM 0.45). Risk is relatively contained and the upside far exceeds the downside. While I have no opinion on the short-term trajectory of oil prices, I can safely recommend this stock as a long-term Buy based on fundamental research.
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Wall Street Week Ahead for the trading week beginning September 23rd, 2019

Good Saturday morning to all of you here on wallstreetbets. I hope everyone on this sub made out pretty nicely in the market this past week, and is ready for the new trading week ahead.
Here is everything you need to know to get you ready for the trading week beginning September 23rd, 2019.

Week ahead: As stocks struggle to break to new highs, markets could be swayed by Fed speakers, trade - (Source)

Developments in U.S.-Chinese trade talks and the comments from a host of Fed speakers could be important for markets in the week ahead, as stocks struggle to regain highs.
The Fed in the past week cut interest rates for the second time in two months, but the latest forecasts of Fed officials showed just how divided they are on the need for future rate cuts. Five wanted deeper cuts, five didn’t want any cuts and another seven were happy with the Fed’s action.
“The market seems like it’s pretty jumpy based on what the say. i think it would flip back and forth depending on how the headlines come out,” said Tom Simons, money market economist at Jefferies. Simons said the focus will also be on the Fed’s operations in the short-term funding market, after turbulence in the overnight market in the past week temporarily sent some overnight rates sharply higher.
There are nearly a dozen Fed speakers on the calendar in the coming week, but Fed Chairman Jerome Powell is not scheduled to speak.
Trade developments could continue to cause volatility in markets. Reports Friday that Chinese agriculture officials canceled visits to farms in Montana and Nebraska sent stocks lower, for fear it signaled that talks were not making progress.
Stocks in the past week were lower, with the S&P off about 0.5% to 2,992. The index had been around 1% away from its all-time high for a few weeks.
“Tech that has been out of play and is acting faulty. it’s now turning into a headwind, and that could cause a problem for the bulls,” said Scott Redler, partner with T3Live.com. “I haven’t seen so many mixed signals in the market in quite some time.”
“It’s hard for the market to make new highs without tech. At best, it’s concerning when you see key names, like Amazon and Netflix, not just failing to lead but faltering,” he said. Netflix was down more than 8% for the week, and Amazon was off 2.6%.
Redler said it was a concern that shares of market leader Microsoft gave up its initial gains and turned negative, soon after it announced a buyback and raised its dividend. “Strength was sold instead of embraced,” he said. “That was good news. What are they going to do when bad news happens?”
Following the attacks on Saudi Aramco last week, the United Nations General Assembly in New York and meetings around it take on more importance for markets. U.S. and Saudi Arabian officials have said Iran was behind the attack, which knocked a significant amount of Saudi oil production off line. Iran has denied involvement, and Houthi rebels in Yemen have claimed responsibility.
Iran’ President Hassan Rouhani has been given a visa to travel to New York for the UN. Before the attack on Saudi Arabia last week, President Donald Trump had suggested he would speak to Rouhani but there seems little chance of that now. Oil have been highly volatile, with Brent crude futures up 7% since the attack as Saudi Arabia sought to assure markets that it would be able to bring its operations back on line.
There is some economic data that will also be important to markets. There is manufacturing PMI Monday, important after ISM manufacturing data showed a contraction in August. Durable goods will also be important on Friday, as will personal consumption data, which includes the Fed’s preferred inflation indicator, the core PCE deflator.
“What Powell said in his remarks was inflation was below his target,” said Marc Chandler, chief market strategist at Bannockburn Global Forex. “But even the core PCE deflator is expected to be 1.8, a new high for the year.” The Fed’s target inflation rate is 2%, and other inflation measures have been above that, including core CPI.
The Fed will also be in focus after problems in the overnight funding market, used by banks in need of short term cash. Rates spiked for repo, or repurchase agreements, in a chaotic two-day period Monday and Tuesday. The Fed’s target fed funds rate also moved above its target range, in an unusual move.
The market has since calmed after the Fed carried out open market operations to add liquidity to the market. On Friday, it announced three 14-day operations involving $30 billion as well as continued overnight operations of at least $75 billion each.
“I think the Fed has absolute control over short term rates. It was caught sleeping at the wheel,” said Chandler.
Powell said the Fed would monitor the market and take whatever action is needed. The market is considered the basic plumbing for financial markets, where banks who have a short-term need for cash come to fund themselves. The odd spike in rates was viewed as the result of a cash crunch, not a credit crisis.
Bond market pros have been concerned that the Fed would again see strains in the market at month end, when there’s more activity in the overnight funding market.
“It gets you further past quarter end,” said Jon Hill, rate strategist at BMO. “A 14-day pushes them further into October. I think nerves will have calmed. The fact you’ll see fed funds print clearly in the range will reassert confidence. These operations will serve as a reminder that the Fed can have absolute control the front end if and when it wants to. This is a good thing.”
The funds rate was at 1.90% Thursday, within the target rate range of 1.75% to 2%.
“They’re removing any doubt of their ability to take control of fed funds in the modern framework. They just announced $165 billion over quarter-end , and we may go bigger. They haven’t done a repo injection in 10 years,” said Hill.

This past week saw the following moves in the S&P:

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Major Indices for this past week:

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Major Futures Markets as of Friday's close:

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Economic Calendar for the Week Ahead:

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Sector Performance WTD, MTD, YTD:

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Percentage Changes for the Major Indices, WTD, MTD, QTD, YTD as of Friday's close:

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S&P Sectors for the Past Week:

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Major Indices Pullback/Correction Levels as of Friday's close:

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Major Indices Rally Levels as of Friday's close:

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Most Anticipated Earnings Releases for this week:

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Here are the upcoming IPO's for this week:

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Friday's Stock Analyst Upgrades & Downgrades:

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S&P 500 down 23 of 29 during week after September options expiration, average loss 0.95%

The week after September options expiration week, next week, has a dreadful history of declines especially since 1990. The week after September options expiration week has been a nearly constant source of pain with only a few meaningful exceptions over the past 29 years. Substantial and across the board gains have occurred just three times: 1998, 2001, 2010 and 2016 while many more weeks were hit with sizable losses.
Full stats are in the following sea-of-red table. Average losses since 1990 are even worse; DJIA –1.02%, S&P 500 –0.95%, NASDAQ –0.90% and a sizable –1.38% for Russell 2000. End-of-Q3 portfolio restructuring is the most likely explanation for this trend as managers trim summer losers and position for the fourth quarter.
(CLICK HERE FOR THE CHART!)

October Challenging in Pre-Election Years

October often evokes fear on Wall Street as memories are stirred of crashes in 1929, 1987, the 554-point drop on October 27, 1997, back-to-back massacres in 1978 and 1979, Friday the 13th in 1989 and the 733-point drop on October 15, 2008. During the week ending October 10, 2008, Dow lost 1,874.19 points (18.2%), the worst weekly decline in our database going back to 1901, in point and percentage terms. The term “Octoberphobia” has been used to describe the phenomenon of major market drops occurring during the month. Market calamities can become a self-fulfilling prophecy, so stay on the lookout and don’t get whipsawed if it happens.
(CLICK HERE FOR THE CHART!)
Pre-election year Octobers are ranked second from last for DJIA, S&P 500 and NASDAQ while Russell 2000 is dead last with an average loss of 1.9%. Eliminating gruesome 1987 from the calculation provides only a moderate amount of relief. Should a meaningful decline materialize in October it is likely to be an excellent buying opportunity, especially for depressed technology and small-cap shares.

Where’s That September Volatility?

September is historically known as one of the worst for stocks, yet in 2019 the S&P 500 Index is up 2.7% so far amid a sea of scary headlines. Incredibly, the S&P 500 has wavered less than 0.1% from its previous close 6 of the past 10 trading sessions, as it consolidates just beneath all-time highs.
“Over the past two weeks we’ve had the European Central Bank meeting, the Federal Reserve meeting, higher inflation, a historic jump in crude oil, Middle East turmoil, trouble in the repo market, and even multiple NFL quarterbacks sustaining major injuries,” said LPL Financial Senior Market Strategist Ryan Detrick. “Yet, with all of those scary headlines, stocks are actually in the midst of one of the least volatile two-week stretches we’ve seen in years.”
We are quite encouraged by the overall change in market tone we’ve heard recently, with more cyclical names taking the baton and leading, but with the S&P 500 up near our fair value target of 3,000, we would be on the lookout for this sea of tranquility to get rougher at any time. In fact, according to historical calendars, we may need to be on high guard for the second half of September.
As shown in the LPL Chart of the Day, The Second Half of September Can Be Tricky For Stocks, later in the month of September is when we’ve seen seasonal weakness. Things have been going well for equities in the face of some worrisome headlines, but don’t get complacent, as the calendar could be one of the biggest near-term risks.
(CLICK HERE FOR THE CHART!)

The Fed Hits It Down The Middle

“History does not repeat itself, but it rhymes.” Mark Twain
As expected, the Federal Reserve’s (Fed) policy committee cut its policy rate by 25 basis points (.25%) to a target range of 1.75%–2%. This comes on the heels of the first rate cut in more than 10 years at the end of July. This cut is somewhat more controversial, however, because the overall U.S. economic data has been improving, and there’s been a tick higher in inflation.
One of the most important questions heading into this meeting was how many voting Fed members would support additional rate cuts. There were two dissenting voting members at the July rate cut, and once again there were two votes opposed to today’s cut—but unlike last time, there was also one dissenter who favored a larger 50 basis point (.50%) cut. Materials in the economic projections indicated 10 of 17 participants (which includes non-voting members) did not believe additional cuts would be needed over the remainder of the year, although evolving economic conditions could certainly lead to a shift.
As the quote from Mark Twain suggests, by looking back at history we can potentially find clues as to what might happen in the future.
Looking back at the previous two recessions (2001 and 2008), the Fed cut rates 50 basis points (.50%) to kick off the new cycle of rate cuts. We looked back at what the Fed said at the time, and policymakers didn’t foresee a recession; the larger .50% cut might have been their way of showing how worried they really were at the time. In other words, maybe the Fed knew there potentially was trouble under the surface.
Compare this with three consecutive 25 basis point (.25%) cuts in the 1995/1996 and 1998 rate cut cycles, which led to continued equity gains and avoided recessions. Given we foresee one more cut this year, could it be another three cuts of 25 basis points (.25%) and then an economic acceleration?
“Here’s the catch. When the first two cuts in a new cycle of rate cuts are only 25 basis points, this could be the Fed’s way of truly viewing the cuts as insurance,” explained LPL Financial Senior Market Strategist Ryan Detrick. “In fact, the past five cycles of cuts that started with two 25 basis point cuts saw the S&P 500 Index move higher 6 and 12 months later every single time.”
As shown in the LPL Chart of the Day, Stocks Have Historically Done Well If The First Two Fed Rate Cuts Are 25 Basis Points, the S&P 500 was up an average of 9.7% six months after the second of two 25 basis point cuts to kick off a new cycle of rate cuts. Going out a year, the S&P 500 had gained a very impressive average of 16.7%.
(CLICK HERE FOR THE CHART!)

Strong Start for September, but Second Half Could Bring Trouble

As of Friday’s close the market is well above historical average performance in September. DJIA was up nearly 3.1%, S&P 500 was up 2.8%, NASDAQ and Russell 1000 were up 2.7% while Russell 2000 was up 5.6%. Small-caps outperforming large-caps recently is not unusual and they did so again today. However, the second half of September has historically been weaker than the first half. The week after options expiration week can be treacherous with S&P 500 logging 23 weekly losses in 29 years since 1990. End-of-quarter portfolio restructuring, and window dressing can amplify the impacts of any negative headlines.
(CLICK HERE FOR THE CHART!)

Broader Transports Still Outperforming YTD

With shares of FedEx (FDX) on pace for their second worst earnings reaction day since at least 2001, the Dow Transports, an index in which FDX has a weighting of over 8% (after today's decline), is down close to 2%. Historically, the Transports have been considered a leading indicator of the economy, so the weakness in FDX, and by extension, the Dow Transports, is resulting in heightened concerns over the state of the economy. Looking at the chart below, the picture for the Transports doesn't look pretty. The timing of today's decline couldn't have been worse as it came just as the Transports were attempting to break above the highs from July, but now it just looks like the second lower high this year. Following today's declines, the Dow Transports are up 14.7% YTD which is about five percentage points behind the performance of the S&P 500.
(CLICK HERE FOR THE CHART!)
Given the changes in the US economy over time, we've been skeptical of the continued predictive ability of the Transports, but even putting that aside for a moment, a broader look at Transports shows a less pessimistic picture. The chart below shows the performance of the stocks in the S&P 1500 index on an equal-weighted basis so far in 2019. By this measure, today's decline comes after the index made a higher high, and while it's back below those former highs today, with a gain of 20.5% YTD, this broader look at transports is still outperforming the S&P 500 on a YTD basis. It may not be a great picture for this group of transport stocks, but it doesn't really look bad either.
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STOCK MARKET VIDEO: Stock Market Analysis Video for Week Ending September 20th, 2019

(CLICK HERE FOR THE YOUTUBE VIDEO!)

STOCK MARKET VIDEO: ShadowTrader Video Weekly 09.22.19

(CLICK HERE FOR THE YOUTUBE VIDEO!)
Here are the most notable companies (tickers) reporting earnings in this upcoming trading week ahead-
  • $MU
  • $NIO
  • $AZO
  • $KMX
  • $NKE
  • $BB
  • $RAD
  • $CMD
  • $ACN
  • $UXIN
  • $JBL
  • $INFO
  • $CAG
  • $DAVA
  • $MANU
  • $SNX
  • $FDS
  • $KBH
  • $UEPS
  • $ATU
  • $CTAS
  • $MTN
  • $AGTC
  • $WOR
  • $PIR
  • $ISR
  • $DLNG
  • $CAMP
  • $AIR
  • $FUL
  • $PRGS
  • $CMTL
  • $DYNT
  • $RBZ
(CLICK HERE FOR NEXT WEEK'S MOST NOTABLE EARNINGS RELEASES!)
(CLICK HERE FOR NEXT WEEK'S HIGHEST VOLATILITY EARNINGS RELEASES!)
(CLICK HERE FOR MOST ANTICIPATED EARNINGS RELEASES FOR THE NEXT 5 WEEKS!)
Below are some of the notable companies coming out with earnings releases this upcoming trading week ahead which includes the date/time of release & consensus estimates courtesy of Earnings Whispers:

Monday 9.23.19 Before Market Open:

(CLICK HERE FOR MONDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES!)

Monday 9.23.19 After Market Close:

([CLICK HERE FOR MONDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES LINK!]())
NONE.

Tuesday 9.24.19 Before Market Open:

(CLICK HERE FOR TUESDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES LINK!)

Tuesday 9.24.19 After Market Close:

(CLICK HERE FOR TUESDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES LINK!)

Wednesday 9.25.19 Before Market Open:

(CLICK HERE FOR WEDNESDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES LINK!)

Wednesday 9.25.19 After Market Close:

(CLICK HERE FOR WEDNESDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES LINK!)

Thursday 9.26.19 Before Market Open:

(CLICK HERE FOR THURSDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES LINK!)

Thursday 9.26.19 After Market Close:

(CLICK HERE FOR THURSDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES LINK!)

Friday 9.27.19 Before Market Open:

([CLICK HERE FOR FRIDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES!]())
NONE.

Friday 9.27.19 After Market Close:

([CLICK HERE FOR FRIDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES!]())
NONE.

Micron Technology, Inc. $49.16

Micron Technology, Inc. (MU) is confirmed to report earnings at approximately 4:05 PM ET on Thursday, September 26, 2019. The consensus earnings estimate is $0.43 per share on revenue of $4.51 billion and the Earnings Whisper ® number is $0.49 per share. Investor sentiment going into the company's earnings release has 67% expecting an earnings beat The company's guidance was for earnings of $0.38 to $0.52 per share. Consensus estimates are for earnings to decline year-over-year by 87.92% with revenue decreasing by 46.56%. Short interest has decreased by 21.7% since the company's last earnings release while the stock has drifted higher by 37.1% from its open following the earnings release to be 23.2% above its 200 day moving average of $39.90. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, September 20, 2019 there was some notable buying of 12,865 contracts of the $50.00 put expiring on Friday, September 27, 2019. Option traders are pricing in a 7.5% move on earnings and the stock has averaged a 7.1% move in recent quarters.

(CLICK HERE FOR THE CHART!)

NIO Inc. $3.04

NIO Inc. (NIO) is confirmed to report earnings at approximately 4:30 AM ET on Tuesday, September 24, 2019. Investor sentiment going into the company's earnings release has 51% expecting an earnings beat The company's guidance was for revenue of $169.00 million to $193.00 million. Short interest has increased by 25.8% since the company's last earnings release while the stock has drifted lower by 26.2% from its open following the earnings release to be 39.6% below its 200 day moving average of $5.03. On Wednesday, September 4, 2019 there was some notable buying of 40,590 contracts of the $1.50 put expiring on Friday, November 15, 2019. Option traders are pricing in a 17.1% move on earnings and the stock has averaged a 9.7% move in recent quarters.

(CLICK HERE FOR THE CHART!)

AutoZone, Inc. -

AutoZone, Inc. (AZO) is confirmed to report earnings at approximately 7:00 AM ET on Tuesday, September 24, 2019. The consensus earnings estimate is $21.64 per share on revenue of $3.94 billion and the Earnings Whisper ® number is $21.98 per share. Investor sentiment going into the company's earnings release has 62% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 16.72% with revenue increasing by 10.71%. Short interest has increased by 23.5% since the company's last earnings release while the stock has drifted higher by 15.1% from its open following the earnings release to be 15.6% above its 200 day moving average of $1,003.22. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 5.8% move on earnings and the stock has averaged a 6.7% move in recent quarters.

(CLICK HERE FOR THE CHART!)

CarMax, Inc. $84.63

CarMax, Inc. (KMX) is confirmed to report earnings at approximately 7:35 AM ET on Tuesday, September 24, 2019. The consensus earnings estimate is $1.33 per share on revenue of $5.03 billion and the Earnings Whisper ® number is $1.38 per share. Investor sentiment going into the company's earnings release has 63% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 7.26% with revenue increasing by 5.54%. Short interest has increased by 0.7% since the company's last earnings release while the stock has drifted lower by 3.6% from its open following the earnings release to be 14.9% above its 200 day moving average of $73.63. Overall earnings estimates have been revised higher since the company's last earnings release. On Friday, September 6, 2019 there was some notable buying of 1,023 contracts of the $92.50 call expiring on Friday, October 18, 2019. Option traders are pricing in a 7.2% move on earnings and the stock has averaged a 6.0% move in recent quarters.

(CLICK HERE FOR THE CHART!)

Nike Inc $86.68

Nike Inc (NKE) is confirmed to report earnings at approximately 4:15 PM ET on Tuesday, September 24, 2019. The consensus earnings estimate is $0.71 per share on revenue of $10.45 billion and the Earnings Whisper ® number is $0.76 per share. Investor sentiment going into the company's earnings release has 65% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 5.97% with revenue increasing by 5.05%. Short interest has increased by 0.4% since the company's last earnings release while the stock has drifted higher by 3.2% from its open following the earnings release to be 5.1% above its 200 day moving average of $82.50. Overall earnings estimates have been revised lower since the company's last earnings release. On Monday, September 16, 2019 there was some notable buying of 4,646 contracts of the $84.00 call expiring on Friday, September 27, 2019. Option traders are pricing in a 5.2% move on earnings and the stock has averaged a 4.5% move in recent quarters.

(CLICK HERE FOR THE CHART!)

BlackBerry Limited $7.54

BlackBerry Limited (BB) is confirmed to report earnings at approximately 7:00 AM ET on Tuesday, September 24, 2019. The consensus estimate is for a loss of $0.01 per share and the Earnings Whisper ® number is $0.01 per share. Investor sentiment going into the company's earnings release has 32% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 150.00% with revenue increasing by 375.71%. Short interest has increased by 1.0% since the company's last earnings release while the stock has drifted lower by 9.2% from its open following the earnings release to be 6.9% below its 200 day moving average of $8.10. Overall earnings estimates have been revised higher since the company's last earnings release. On Tuesday, September 17, 2019 there was some notable buying of 2,012 contracts of the $8.00 call expiring on Friday, September 27, 2019. Option traders are pricing in a 9.9% move on earnings and the stock has averaged a 7.9% move in recent quarters.

(CLICK HERE FOR THE CHART!)

Rite Aid Corp. $7.40

Rite Aid Corp. (RAD) is confirmed to report earnings at approximately 7:00 AM ET on Thursday, September 26, 2019. The consensus earnings estimate is $0.08 per share on revenue of $5.42 billion and the Earnings Whisper ® number is $0.10 per share. Investor sentiment going into the company's earnings release has 50% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 900.00% with revenue decreasing by 0.03%. Short interest has increased by 22.2% since the company's last earnings release while the stock has drifted higher by 5.1% from its open following the earnings release to be 36.4% below its 200 day moving average of $11.64. On Wednesday, September 18, 2019 there was some notable buying of 580 contracts of the $7.00 call expiring on Friday, October 18, 2019. Option traders are pricing in a 20.7% move on earnings and the stock has averaged a 20.5% move in recent quarters.

(CLICK HERE FOR THE CHART!)

Cantel Medical Corp. $85.02

Cantel Medical Corp. (CMD) is confirmed to report earnings at approximately 8:00 AM ET on Monday, September 23, 2019. The consensus earnings estimate is $0.61 per share on revenue of $238.60 million and the Earnings Whisper ® number is $0.61 per share. Investor sentiment going into the company's earnings release has 55% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 1.61% with revenue increasing by 4.26%. Short interest has increased by 47.7% since the company's last earnings release while the stock has drifted higher by 27.5% from its open following the earnings release to be 10.7% above its 200 day moving average of $76.78. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, September 20, 2019 there was some notable buying of 571 contracts of the $90.00 call expiring on Friday, October 18, 2019. Option traders are pricing in a 7.0% move on earnings and the stock has averaged a 6.9% move in recent quarters.

(CLICK HERE FOR THE CHART!)

Accenture Ltd. $193.09

Accenture Ltd. (ACN) is confirmed to report earnings at approximately 6:50 AM ET on Thursday, September 26, 2019. The consensus earnings estimate is $1.71 per share on revenue of $11.08 billion and the Earnings Whisper ® number is $1.74 per share. Investor sentiment going into the company's earnings release has 67% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 8.23% with revenue increasing by 4.11%. Short interest has increased by 23.3% since the company's last earnings release while the stock has drifted higher by 8.0% from its open following the earnings release to be 11.3% above its 200 day moving average of $173.47. Overall earnings estimates have been unchanged since the company's last earnings release. On Friday, September 13, 2019 there was some notable buying of 1,279 contracts of the $115.00 put expiring on Friday, November 15, 2019. Option traders are pricing in a 4.5% move on earnings and the stock has averaged a 4.2% move in recent quarters.

(CLICK HERE FOR THE CHART!)

Uxin Limited $3.26

Uxin Limited (UXIN) is confirmed to report earnings before the market opens on Monday, September 23, 2019. The consensus estimate is for a loss of $0.09 per share. Investor sentiment going into the company's earnings release has 66% expecting an earnings beat The company's guidance was for revenue of $130.00 million to $137.00 million. Consensus estimates are for earnings to decline year-over-year by 200.00% with revenue increasing by 892.95%. The stock has drifted higher by 44.9% from its open following the earnings release to be 4.5% below its 200 day moving average of $3.41. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, September 20, 2019 there was some notable buying of 509 contracts of the $4.00 call expiring on Friday, October 18, 2019. Option traders are pricing in a 24.5% move on earnings and the stock has averaged a 10.5% move in recent quarters.

(CLICK HERE FOR THE CHART!)

DISCUSS!

What are you all watching for in this upcoming trading week?
I hope you all have a wonderful weekend and a great trading week ahead wallstreetbets.
submitted by bigbear0083 to wallstreetbets [link] [comments]

Wall Street Week Ahead for the trading week beginning September 23rd, 2019

Good Saturday morning to all of you here on StockMarket. I hope everyone on this sub made out pretty nicely in the market this past week, and is ready for the new trading week ahead.
Here is everything you need to know to get you ready for the trading week beginning September 23rd, 2019.

Week ahead: As stocks struggle to break to new highs, markets could be swayed by Fed speakers, trade - (Source)

Developments in U.S.-Chinese trade talks and the comments from a host of Fed speakers could be important for markets in the week ahead, as stocks struggle to regain highs.
The Fed in the past week cut interest rates for the second time in two months, but the latest forecasts of Fed officials showed just how divided they are on the need for future rate cuts. Five wanted deeper cuts, five didn’t want any cuts and another seven were happy with the Fed’s action.
“The market seems like it’s pretty jumpy based on what the say. i think it would flip back and forth depending on how the headlines come out,” said Tom Simons, money market economist at Jefferies. Simons said the focus will also be on the Fed’s operations in the short-term funding market, after turbulence in the overnight market in the past week temporarily sent some overnight rates sharply higher.
There are nearly a dozen Fed speakers on the calendar in the coming week, but Fed Chairman Jerome Powell is not scheduled to speak.
Trade developments could continue to cause volatility in markets. Reports Friday that Chinese agriculture officials canceled visits to farms in Montana and Nebraska sent stocks lower, for fear it signaled that talks were not making progress.
Stocks in the past week were lower, with the S&P off about 0.5% to 2,992. The index had been around 1% away from its all-time high for a few weeks.
“Tech that has been out of play and is acting faulty. it’s now turning into a headwind, and that could cause a problem for the bulls,” said Scott Redler, partner with T3Live.com. “I haven’t seen so many mixed signals in the market in quite some time.”
“It’s hard for the market to make new highs without tech. At best, it’s concerning when you see key names, like Amazon and Netflix, not just failing to lead but faltering,” he said. Netflix was down more than 8% for the week, and Amazon was off 2.6%.
Redler said it was a concern that shares of market leader Microsoft gave up its initial gains and turned negative, soon after it announced a buyback and raised its dividend. “Strength was sold instead of embraced,” he said. “That was good news. What are they going to do when bad news happens?”
Following the attacks on Saudi Aramco last week, the United Nations General Assembly in New York and meetings around it take on more importance for markets. U.S. and Saudi Arabian officials have said Iran was behind the attack, which knocked a significant amount of Saudi oil production off line. Iran has denied involvement, and Houthi rebels in Yemen have claimed responsibility.
Iran’ President Hassan Rouhani has been given a visa to travel to New York for the UN. Before the attack on Saudi Arabia last week, President Donald Trump had suggested he would speak to Rouhani but there seems little chance of that now. Oil have been highly volatile, with Brent crude futures up 7% since the attack as Saudi Arabia sought to assure markets that it would be able to bring its operations back on line.
There is some economic data that will also be important to markets. There is manufacturing PMI Monday, important after ISM manufacturing data showed a contraction in August. Durable goods will also be important on Friday, as will personal consumption data, which includes the Fed’s preferred inflation indicator, the core PCE deflator.
“What Powell said in his remarks was inflation was below his target,” said Marc Chandler, chief market strategist at Bannockburn Global Forex. “But even the core PCE deflator is expected to be 1.8, a new high for the year.” The Fed’s target inflation rate is 2%, and other inflation measures have been above that, including core CPI.
The Fed will also be in focus after problems in the overnight funding market, used by banks in need of short term cash. Rates spiked for repo, or repurchase agreements, in a chaotic two-day period Monday and Tuesday. The Fed’s target fed funds rate also moved above its target range, in an unusual move.
The market has since calmed after the Fed carried out open market operations to add liquidity to the market. On Friday, it announced three 14-day operations involving $30 billion as well as continued overnight operations of at least $75 billion each.
“I think the Fed has absolute control over short term rates. It was caught sleeping at the wheel,” said Chandler.
Powell said the Fed would monitor the market and take whatever action is needed. The market is considered the basic plumbing for financial markets, where banks who have a short-term need for cash come to fund themselves. The odd spike in rates was viewed as the result of a cash crunch, not a credit crisis.
Bond market pros have been concerned that the Fed would again see strains in the market at month end, when there’s more activity in the overnight funding market.
“It gets you further past quarter end,” said Jon Hill, rate strategist at BMO. “A 14-day pushes them further into October. I think nerves will have calmed. The fact you’ll see fed funds print clearly in the range will reassert confidence. These operations will serve as a reminder that the Fed can have absolute control the front end if and when it wants to. This is a good thing.”
The funds rate was at 1.90% Thursday, within the target rate range of 1.75% to 2%.
“They’re removing any doubt of their ability to take control of fed funds in the modern framework. They just announced $165 billion over quarter-end , and we may go bigger. They haven’t done a repo injection in 10 years,” said Hill.

This past week saw the following moves in the S&P:

(CLICK HERE FOR THE FULL S&P TREE MAP FOR THE PAST WEEK!)

Major Indices for this past week:

(CLICK HERE FOR THE MAJOR INDICES FOR THE PAST WEEK!)

Major Futures Markets as of Friday's close:

(CLICK HERE FOR THE MAJOR FUTURES INDICES AS OF FRIDAY!)

Economic Calendar for the Week Ahead:

(CLICK HERE FOR THE FULL ECONOMIC CALENDAR FOR THE WEEK AHEAD!)

Sector Performance WTD, MTD, YTD:

(CLICK HERE FOR FRIDAY'S PERFORMANCE!)
(CLICK HERE FOR THE WEEK-TO-DATE PERFORMANCE!)
(CLICK HERE FOR THE MONTH-TO-DATE PERFORMANCE!)
(CLICK HERE FOR THE 3-MONTH PERFORMANCE!)
(CLICK HERE FOR THE YEAR-TO-DATE PERFORMANCE!)
(CLICK HERE FOR THE 52-WEEK PERFORMANCE!)

Percentage Changes for the Major Indices, WTD, MTD, QTD, YTD as of Friday's close:

(CLICK HERE FOR THE CHART!)

S&P Sectors for the Past Week:

(CLICK HERE FOR THE CHART!)

Major Indices Pullback/Correction Levels as of Friday's close:

(CLICK HERE FOR THE CHART!

Major Indices Rally Levels as of Friday's close:

(CLICK HERE FOR THE CHART!)

Most Anticipated Earnings Releases for this week:

(CLICK HERE FOR THE CHART!)

Here are the upcoming IPO's for this week:

(CLICK HERE FOR THE CHART!)

Friday's Stock Analyst Upgrades & Downgrades:

(CLICK HERE FOR THE CHART LINK #1!)
(CLICK HERE FOR THE CHART LINK #2!)
(CLICK HERE FOR THE CHART LINK #3!)

S&P 500 down 23 of 29 during week after September options expiration, average loss 0.95%

The week after September options expiration week, next week, has a dreadful history of declines especially since 1990. The week after September options expiration week has been a nearly constant source of pain with only a few meaningful exceptions over the past 29 years. Substantial and across the board gains have occurred just three times: 1998, 2001, 2010 and 2016 while many more weeks were hit with sizable losses.
Full stats are in the following sea-of-red table. Average losses since 1990 are even worse; DJIA –1.02%, S&P 500 –0.95%, NASDAQ –0.90% and a sizable –1.38% for Russell 2000. End-of-Q3 portfolio restructuring is the most likely explanation for this trend as managers trim summer losers and position for the fourth quarter.
(CLICK HERE FOR THE CHART!)

October Challenging in Pre-Election Years

October often evokes fear on Wall Street as memories are stirred of crashes in 1929, 1987, the 554-point drop on October 27, 1997, back-to-back massacres in 1978 and 1979, Friday the 13th in 1989 and the 733-point drop on October 15, 2008. During the week ending October 10, 2008, Dow lost 1,874.19 points (18.2%), the worst weekly decline in our database going back to 1901, in point and percentage terms. The term “Octoberphobia” has been used to describe the phenomenon of major market drops occurring during the month. Market calamities can become a self-fulfilling prophecy, so stay on the lookout and don’t get whipsawed if it happens.
(CLICK HERE FOR THE CHART!)
Pre-election year Octobers are ranked second from last for DJIA, S&P 500 and NASDAQ while Russell 2000 is dead last with an average loss of 1.9%. Eliminating gruesome 1987 from the calculation provides only a moderate amount of relief. Should a meaningful decline materialize in October it is likely to be an excellent buying opportunity, especially for depressed technology and small-cap shares.

Where’s That September Volatility?

September is historically known as one of the worst for stocks, yet in 2019 the S&P 500 Index is up 2.7% so far amid a sea of scary headlines. Incredibly, the S&P 500 has wavered less than 0.1% from its previous close 6 of the past 10 trading sessions, as it consolidates just beneath all-time highs.
“Over the past two weeks we’ve had the European Central Bank meeting, the Federal Reserve meeting, higher inflation, a historic jump in crude oil, Middle East turmoil, trouble in the repo market, and even multiple NFL quarterbacks sustaining major injuries,” said LPL Financial Senior Market Strategist Ryan Detrick. “Yet, with all of those scary headlines, stocks are actually in the midst of one of the least volatile two-week stretches we’ve seen in years.”
We are quite encouraged by the overall change in market tone we’ve heard recently, with more cyclical names taking the baton and leading, but with the S&P 500 up near our fair value target of 3,000, we would be on the lookout for this sea of tranquility to get rougher at any time. In fact, according to historical calendars, we may need to be on high guard for the second half of September.
As shown in the LPL Chart of the Day, The Second Half of September Can Be Tricky For Stocks, later in the month of September is when we’ve seen seasonal weakness. Things have been going well for equities in the face of some worrisome headlines, but don’t get complacent, as the calendar could be one of the biggest near-term risks.
(CLICK HERE FOR THE CHART!)

The Fed Hits It Down The Middle

“History does not repeat itself, but it rhymes.” Mark Twain
As expected, the Federal Reserve’s (Fed) policy committee cut its policy rate by 25 basis points (.25%) to a target range of 1.75%–2%. This comes on the heels of the first rate cut in more than 10 years at the end of July. This cut is somewhat more controversial, however, because the overall U.S. economic data has been improving, and there’s been a tick higher in inflation.
One of the most important questions heading into this meeting was how many voting Fed members would support additional rate cuts. There were two dissenting voting members at the July rate cut, and once again there were two votes opposed to today’s cut—but unlike last time, there was also one dissenter who favored a larger 50 basis point (.50%) cut. Materials in the economic projections indicated 10 of 17 participants (which includes non-voting members) did not believe additional cuts would be needed over the remainder of the year, although evolving economic conditions could certainly lead to a shift.
As the quote from Mark Twain suggests, by looking back at history we can potentially find clues as to what might happen in the future.
Looking back at the previous two recessions (2001 and 2008), the Fed cut rates 50 basis points (.50%) to kick off the new cycle of rate cuts. We looked back at what the Fed said at the time, and policymakers didn’t foresee a recession; the larger .50% cut might have been their way of showing how worried they really were at the time. In other words, maybe the Fed knew there potentially was trouble under the surface.
Compare this with three consecutive 25 basis point (.25%) cuts in the 1995/1996 and 1998 rate cut cycles, which led to continued equity gains and avoided recessions. Given we foresee one more cut this year, could it be another three cuts of 25 basis points (.25%) and then an economic acceleration?
“Here’s the catch. When the first two cuts in a new cycle of rate cuts are only 25 basis points, this could be the Fed’s way of truly viewing the cuts as insurance,” explained LPL Financial Senior Market Strategist Ryan Detrick. “In fact, the past five cycles of cuts that started with two 25 basis point cuts saw the S&P 500 Index move higher 6 and 12 months later every single time.”
As shown in the LPL Chart of the Day, Stocks Have Historically Done Well If The First Two Fed Rate Cuts Are 25 Basis Points, the S&P 500 was up an average of 9.7% six months after the second of two 25 basis point cuts to kick off a new cycle of rate cuts. Going out a year, the S&P 500 had gained a very impressive average of 16.7%.
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Strong Start for September, but Second Half Could Bring Trouble

As of Friday’s close the market is well above historical average performance in September. DJIA was up nearly 3.1%, S&P 500 was up 2.8%, NASDAQ and Russell 1000 were up 2.7% while Russell 2000 was up 5.6%. Small-caps outperforming large-caps recently is not unusual and they did so again today. However, the second half of September has historically been weaker than the first half. The week after options expiration week can be treacherous with S&P 500 logging 23 weekly losses in 29 years since 1990. End-of-quarter portfolio restructuring, and window dressing can amplify the impacts of any negative headlines.
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Broader Transports Still Outperforming YTD

With shares of FedEx (FDX) on pace for their second worst earnings reaction day since at least 2001, the Dow Transports, an index in which FDX has a weighting of over 8% (after today's decline), is down close to 2%. Historically, the Transports have been considered a leading indicator of the economy, so the weakness in FDX, and by extension, the Dow Transports, is resulting in heightened concerns over the state of the economy. Looking at the chart below, the picture for the Transports doesn't look pretty. The timing of today's decline couldn't have been worse as it came just as the Transports were attempting to break above the highs from July, but now it just looks like the second lower high this year. Following today's declines, the Dow Transports are up 14.7% YTD which is about five percentage points behind the performance of the S&P 500.
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Given the changes in the US economy over time, we've been skeptical of the continued predictive ability of the Transports, but even putting that aside for a moment, a broader look at Transports shows a less pessimistic picture. The chart below shows the performance of the stocks in the S&P 1500 index on an equal-weighted basis so far in 2019. By this measure, today's decline comes after the index made a higher high, and while it's back below those former highs today, with a gain of 20.5% YTD, this broader look at transports is still outperforming the S&P 500 on a YTD basis. It may not be a great picture for this group of transport stocks, but it doesn't really look bad either.
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STOCK MARKET VIDEO: Stock Market Analysis Video for Week Ending September 20th, 2019

(CLICK HERE FOR THE YOUTUBE VIDEO!)

STOCK MARKET VIDEO: ShadowTrader Video Weekly 09.22.19

(CLICK HERE FOR THE YOUTUBE VIDEO!)
Here are the most notable companies (tickers) reporting earnings in this upcoming trading week ahead-
  • $MU
  • $NIO
  • $AZO
  • $KMX
  • $NKE
  • $BB
  • $RAD
  • $CMD
  • $ACN
  • $UXIN
  • $JBL
  • $INFO
  • $CAG
  • $DAVA
  • $MANU
  • $SNX
  • $FDS
  • $KBH
  • $UEPS
  • $ATU
  • $CTAS
  • $MTN
  • $AGTC
  • $WOR
  • $PIR
  • $ISR
  • $DLNG
  • $CAMP
  • $AIR
  • $FUL
  • $PRGS
  • $CMTL
  • $DYNT
  • $RBZ
(CLICK HERE FOR NEXT WEEK'S MOST NOTABLE EARNINGS RELEASES!)
(CLICK HERE FOR NEXT WEEK'S HIGHEST VOLATILITY EARNINGS RELEASES!)
(CLICK HERE FOR MOST ANTICIPATED EARNINGS RELEASES FOR THE NEXT 5 WEEKS!)
Below are some of the notable companies coming out with earnings releases this upcoming trading week ahead which includes the date/time of release & consensus estimates courtesy of Earnings Whispers:

Monday 9.23.19 Before Market Open:

(CLICK HERE FOR MONDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES!)

Monday 9.23.19 After Market Close:

([CLICK HERE FOR MONDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES LINK!]())
NONE.

Tuesday 9.24.19 Before Market Open:

(CLICK HERE FOR TUESDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES LINK!)

Tuesday 9.24.19 After Market Close:

(CLICK HERE FOR TUESDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES LINK!)

Wednesday 9.25.19 Before Market Open:

(CLICK HERE FOR WEDNESDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES LINK!)

Wednesday 9.25.19 After Market Close:

(CLICK HERE FOR WEDNESDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES LINK!)

Thursday 9.26.19 Before Market Open:

(CLICK HERE FOR THURSDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES LINK!)

Thursday 9.26.19 After Market Close:

(CLICK HERE FOR THURSDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES LINK!)

Friday 9.27.19 Before Market Open:

([CLICK HERE FOR FRIDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES!]())
NONE.

Friday 9.27.19 After Market Close:

([CLICK HERE FOR FRIDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES!]())
NONE.

Micron Technology, Inc. $49.16

Micron Technology, Inc. (MU) is confirmed to report earnings at approximately 4:05 PM ET on Thursday, September 26, 2019. The consensus earnings estimate is $0.43 per share on revenue of $4.51 billion and the Earnings Whisper ® number is $0.49 per share. Investor sentiment going into the company's earnings release has 67% expecting an earnings beat The company's guidance was for earnings of $0.38 to $0.52 per share. Consensus estimates are for earnings to decline year-over-year by 87.92% with revenue decreasing by 46.56%. Short interest has decreased by 21.7% since the company's last earnings release while the stock has drifted higher by 37.1% from its open following the earnings release to be 23.2% above its 200 day moving average of $39.90. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, September 20, 2019 there was some notable buying of 12,865 contracts of the $50.00 put expiring on Friday, September 27, 2019. Option traders are pricing in a 7.5% move on earnings and the stock has averaged a 7.1% move in recent quarters.

(CLICK HERE FOR THE CHART!)

NIO Inc. $3.04

NIO Inc. (NIO) is confirmed to report earnings at approximately 4:30 AM ET on Tuesday, September 24, 2019. Investor sentiment going into the company's earnings release has 51% expecting an earnings beat The company's guidance was for revenue of $169.00 million to $193.00 million. Short interest has increased by 25.8% since the company's last earnings release while the stock has drifted lower by 26.2% from its open following the earnings release to be 39.6% below its 200 day moving average of $5.03. On Wednesday, September 4, 2019 there was some notable buying of 40,590 contracts of the $1.50 put expiring on Friday, November 15, 2019. Option traders are pricing in a 17.1% move on earnings and the stock has averaged a 9.7% move in recent quarters.

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AutoZone, Inc. -

AutoZone, Inc. (AZO) is confirmed to report earnings at approximately 7:00 AM ET on Tuesday, September 24, 2019. The consensus earnings estimate is $21.64 per share on revenue of $3.94 billion and the Earnings Whisper ® number is $21.98 per share. Investor sentiment going into the company's earnings release has 62% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 16.72% with revenue increasing by 10.71%. Short interest has increased by 23.5% since the company's last earnings release while the stock has drifted higher by 15.1% from its open following the earnings release to be 15.6% above its 200 day moving average of $1,003.22. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 5.8% move on earnings and the stock has averaged a 6.7% move in recent quarters.

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CarMax, Inc. $84.63

CarMax, Inc. (KMX) is confirmed to report earnings at approximately 7:35 AM ET on Tuesday, September 24, 2019. The consensus earnings estimate is $1.33 per share on revenue of $5.03 billion and the Earnings Whisper ® number is $1.38 per share. Investor sentiment going into the company's earnings release has 63% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 7.26% with revenue increasing by 5.54%. Short interest has increased by 0.7% since the company's last earnings release while the stock has drifted lower by 3.6% from its open following the earnings release to be 14.9% above its 200 day moving average of $73.63. Overall earnings estimates have been revised higher since the company's last earnings release. On Friday, September 6, 2019 there was some notable buying of 1,023 contracts of the $92.50 call expiring on Friday, October 18, 2019. Option traders are pricing in a 7.2% move on earnings and the stock has averaged a 6.0% move in recent quarters.

(CLICK HERE FOR THE CHART!)

Nike Inc $86.68

Nike Inc (NKE) is confirmed to report earnings at approximately 4:15 PM ET on Tuesday, September 24, 2019. The consensus earnings estimate is $0.71 per share on revenue of $10.45 billion and the Earnings Whisper ® number is $0.76 per share. Investor sentiment going into the company's earnings release has 65% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 5.97% with revenue increasing by 5.05%. Short interest has increased by 0.4% since the company's last earnings release while the stock has drifted higher by 3.2% from its open following the earnings release to be 5.1% above its 200 day moving average of $82.50. Overall earnings estimates have been revised lower since the company's last earnings release. On Monday, September 16, 2019 there was some notable buying of 4,646 contracts of the $84.00 call expiring on Friday, September 27, 2019. Option traders are pricing in a 5.2% move on earnings and the stock has averaged a 4.5% move in recent quarters.

(CLICK HERE FOR THE CHART!)

BlackBerry Limited $7.54

BlackBerry Limited (BB) is confirmed to report earnings at approximately 7:00 AM ET on Tuesday, September 24, 2019. The consensus estimate is for a loss of $0.01 per share and the Earnings Whisper ® number is $0.01 per share. Investor sentiment going into the company's earnings release has 32% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 150.00% with revenue increasing by 375.71%. Short interest has increased by 1.0% since the company's last earnings release while the stock has drifted lower by 9.2% from its open following the earnings release to be 6.9% below its 200 day moving average of $8.10. Overall earnings estimates have been revised higher since the company's last earnings release. On Tuesday, September 17, 2019 there was some notable buying of 2,012 contracts of the $8.00 call expiring on Friday, September 27, 2019. Option traders are pricing in a 9.9% move on earnings and the stock has averaged a 7.9% move in recent quarters.

(CLICK HERE FOR THE CHART!)

Rite Aid Corp. $7.40

Rite Aid Corp. (RAD) is confirmed to report earnings at approximately 7:00 AM ET on Thursday, September 26, 2019. The consensus earnings estimate is $0.08 per share on revenue of $5.42 billion and the Earnings Whisper ® number is $0.10 per share. Investor sentiment going into the company's earnings release has 50% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 900.00% with revenue decreasing by 0.03%. Short interest has increased by 22.2% since the company's last earnings release while the stock has drifted higher by 5.1% from its open following the earnings release to be 36.4% below its 200 day moving average of $11.64. On Wednesday, September 18, 2019 there was some notable buying of 580 contracts of the $7.00 call expiring on Friday, October 18, 2019. Option traders are pricing in a 20.7% move on earnings and the stock has averaged a 20.5% move in recent quarters.

(CLICK HERE FOR THE CHART!)

Cantel Medical Corp. $85.02

Cantel Medical Corp. (CMD) is confirmed to report earnings at approximately 8:00 AM ET on Monday, September 23, 2019. The consensus earnings estimate is $0.61 per share on revenue of $238.60 million and the Earnings Whisper ® number is $0.61 per share. Investor sentiment going into the company's earnings release has 55% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 1.61% with revenue increasing by 4.26%. Short interest has increased by 47.7% since the company's last earnings release while the stock has drifted higher by 27.5% from its open following the earnings release to be 10.7% above its 200 day moving average of $76.78. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, September 20, 2019 there was some notable buying of 571 contracts of the $90.00 call expiring on Friday, October 18, 2019. Option traders are pricing in a 7.0% move on earnings and the stock has averaged a 6.9% move in recent quarters.

(CLICK HERE FOR THE CHART!)

Accenture Ltd. $193.09

Accenture Ltd. (ACN) is confirmed to report earnings at approximately 6:50 AM ET on Thursday, September 26, 2019. The consensus earnings estimate is $1.71 per share on revenue of $11.08 billion and the Earnings Whisper ® number is $1.74 per share. Investor sentiment going into the company's earnings release has 67% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 8.23% with revenue increasing by 4.11%. Short interest has increased by 23.3% since the company's last earnings release while the stock has drifted higher by 8.0% from its open following the earnings release to be 11.3% above its 200 day moving average of $173.47. Overall earnings estimates have been unchanged since the company's last earnings release. On Friday, September 13, 2019 there was some notable buying of 1,279 contracts of the $115.00 put expiring on Friday, November 15, 2019. Option traders are pricing in a 4.5% move on earnings and the stock has averaged a 4.2% move in recent quarters.

(CLICK HERE FOR THE CHART!)

Uxin Limited $3.26

Uxin Limited (UXIN) is confirmed to report earnings before the market opens on Monday, September 23, 2019. The consensus estimate is for a loss of $0.09 per share. Investor sentiment going into the company's earnings release has 66% expecting an earnings beat The company's guidance was for revenue of $130.00 million to $137.00 million. Consensus estimates are for earnings to decline year-over-year by 200.00% with revenue increasing by 892.95%. The stock has drifted higher by 44.9% from its open following the earnings release to be 4.5% below its 200 day moving average of $3.41. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, September 20, 2019 there was some notable buying of 509 contracts of the $4.00 call expiring on Friday, October 18, 2019. Option traders are pricing in a 24.5% move on earnings and the stock has averaged a 10.5% move in recent quarters.

(CLICK HERE FOR THE CHART!)

DISCUSS!

What are you all watching for in this upcoming trading week?
I hope you all have a wonderful weekend and a great trading week ahead StockMarket.
submitted by bigbear0083 to StockMarket [link] [comments]

Wall Street Week Ahead for the trading week beginning September 23rd, 2019

Good Saturday morning to all of you here on stocks. I hope everyone on this sub made out pretty nicely in the market this past week, and is ready for the new trading week ahead.
Here is everything you need to know to get you ready for the trading week beginning September 23rd, 2019.

Week ahead: As stocks struggle to break to new highs, markets could be swayed by Fed speakers, trade - (Source)

Developments in U.S.-Chinese trade talks and the comments from a host of Fed speakers could be important for markets in the week ahead, as stocks struggle to regain highs.
The Fed in the past week cut interest rates for the second time in two months, but the latest forecasts of Fed officials showed just how divided they are on the need for future rate cuts. Five wanted deeper cuts, five didn’t want any cuts and another seven were happy with the Fed’s action.
“The market seems like it’s pretty jumpy based on what the say. i think it would flip back and forth depending on how the headlines come out,” said Tom Simons, money market economist at Jefferies. Simons said the focus will also be on the Fed’s operations in the short-term funding market, after turbulence in the overnight market in the past week temporarily sent some overnight rates sharply higher.
There are nearly a dozen Fed speakers on the calendar in the coming week, but Fed Chairman Jerome Powell is not scheduled to speak.
Trade developments could continue to cause volatility in markets. Reports Friday that Chinese agriculture officials canceled visits to farms in Montana and Nebraska sent stocks lower, for fear it signaled that talks were not making progress.
Stocks in the past week were lower, with the S&P off about 0.5% to 2,992. The index had been around 1% away from its all-time high for a few weeks.
“Tech that has been out of play and is acting faulty. it’s now turning into a headwind, and that could cause a problem for the bulls,” said Scott Redler, partner with T3Live.com. “I haven’t seen so many mixed signals in the market in quite some time.”
“It’s hard for the market to make new highs without tech. At best, it’s concerning when you see key names, like Amazon and Netflix, not just failing to lead but faltering,” he said. Netflix was down more than 8% for the week, and Amazon was off 2.6%.
Redler said it was a concern that shares of market leader Microsoft gave up its initial gains and turned negative, soon after it announced a buyback and raised its dividend. “Strength was sold instead of embraced,” he said. “That was good news. What are they going to do when bad news happens?”
Following the attacks on Saudi Aramco last week, the United Nations General Assembly in New York and meetings around it take on more importance for markets. U.S. and Saudi Arabian officials have said Iran was behind the attack, which knocked a significant amount of Saudi oil production off line. Iran has denied involvement, and Houthi rebels in Yemen have claimed responsibility.
Iran’ President Hassan Rouhani has been given a visa to travel to New York for the UN. Before the attack on Saudi Arabia last week, President Donald Trump had suggested he would speak to Rouhani but there seems little chance of that now. Oil have been highly volatile, with Brent crude futures up 7% since the attack as Saudi Arabia sought to assure markets that it would be able to bring its operations back on line.
There is some economic data that will also be important to markets. There is manufacturing PMI Monday, important after ISM manufacturing data showed a contraction in August. Durable goods will also be important on Friday, as will personal consumption data, which includes the Fed’s preferred inflation indicator, the core PCE deflator.
“What Powell said in his remarks was inflation was below his target,” said Marc Chandler, chief market strategist at Bannockburn Global Forex. “But even the core PCE deflator is expected to be 1.8, a new high for the year.” The Fed’s target inflation rate is 2%, and other inflation measures have been above that, including core CPI.
The Fed will also be in focus after problems in the overnight funding market, used by banks in need of short term cash. Rates spiked for repo, or repurchase agreements, in a chaotic two-day period Monday and Tuesday. The Fed’s target fed funds rate also moved above its target range, in an unusual move.
The market has since calmed after the Fed carried out open market operations to add liquidity to the market. On Friday, it announced three 14-day operations involving $30 billion as well as continued overnight operations of at least $75 billion each.
“I think the Fed has absolute control over short term rates. It was caught sleeping at the wheel,” said Chandler.
Powell said the Fed would monitor the market and take whatever action is needed. The market is considered the basic plumbing for financial markets, where banks who have a short-term need for cash come to fund themselves. The odd spike in rates was viewed as the result of a cash crunch, not a credit crisis.
Bond market pros have been concerned that the Fed would again see strains in the market at month end, when there’s more activity in the overnight funding market.
“It gets you further past quarter end,” said Jon Hill, rate strategist at BMO. “A 14-day pushes them further into October. I think nerves will have calmed. The fact you’ll see fed funds print clearly in the range will reassert confidence. These operations will serve as a reminder that the Fed can have absolute control the front end if and when it wants to. This is a good thing.”
The funds rate was at 1.90% Thursday, within the target rate range of 1.75% to 2%.
“They’re removing any doubt of their ability to take control of fed funds in the modern framework. They just announced $165 billion over quarter-end , and we may go bigger. They haven’t done a repo injection in 10 years,” said Hill.

This past week saw the following moves in the S&P:

(CLICK HERE FOR THE FULL S&P TREE MAP FOR THE PAST WEEK!)

Major Indices for this past week:

(CLICK HERE FOR THE MAJOR INDICES FOR THE PAST WEEK!)

Major Futures Markets as of Friday's close:

(CLICK HERE FOR THE MAJOR FUTURES INDICES AS OF FRIDAY!)

Economic Calendar for the Week Ahead:

(CLICK HERE FOR THE FULL ECONOMIC CALENDAR FOR THE WEEK AHEAD!)

Sector Performance WTD, MTD, YTD:

(CLICK HERE FOR FRIDAY'S PERFORMANCE!)
(CLICK HERE FOR THE WEEK-TO-DATE PERFORMANCE!)
(CLICK HERE FOR THE MONTH-TO-DATE PERFORMANCE!)
(CLICK HERE FOR THE 3-MONTH PERFORMANCE!)
(CLICK HERE FOR THE YEAR-TO-DATE PERFORMANCE!)
(CLICK HERE FOR THE 52-WEEK PERFORMANCE!)

Percentage Changes for the Major Indices, WTD, MTD, QTD, YTD as of Friday's close:

(CLICK HERE FOR THE CHART!)

S&P Sectors for the Past Week:

(CLICK HERE FOR THE CHART!)

Major Indices Pullback/Correction Levels as of Friday's close:

(CLICK HERE FOR THE CHART!

Major Indices Rally Levels as of Friday's close:

(CLICK HERE FOR THE CHART!)

Most Anticipated Earnings Releases for this week:

(CLICK HERE FOR THE CHART!)

Here are the upcoming IPO's for this week:

(CLICK HERE FOR THE CHART!)

Friday's Stock Analyst Upgrades & Downgrades:

(CLICK HERE FOR THE CHART LINK #1!)
(CLICK HERE FOR THE CHART LINK #2!)
(CLICK HERE FOR THE CHART LINK #3!)

S&P 500 down 23 of 29 during week after September options expiration, average loss 0.95%

The week after September options expiration week, next week, has a dreadful history of declines especially since 1990. The week after September options expiration week has been a nearly constant source of pain with only a few meaningful exceptions over the past 29 years. Substantial and across the board gains have occurred just three times: 1998, 2001, 2010 and 2016 while many more weeks were hit with sizable losses.
Full stats are in the following sea-of-red table. Average losses since 1990 are even worse; DJIA –1.02%, S&P 500 –0.95%, NASDAQ –0.90% and a sizable –1.38% for Russell 2000. End-of-Q3 portfolio restructuring is the most likely explanation for this trend as managers trim summer losers and position for the fourth quarter.
(CLICK HERE FOR THE CHART!)

October Challenging in Pre-Election Years

October often evokes fear on Wall Street as memories are stirred of crashes in 1929, 1987, the 554-point drop on October 27, 1997, back-to-back massacres in 1978 and 1979, Friday the 13th in 1989 and the 733-point drop on October 15, 2008. During the week ending October 10, 2008, Dow lost 1,874.19 points (18.2%), the worst weekly decline in our database going back to 1901, in point and percentage terms. The term “Octoberphobia” has been used to describe the phenomenon of major market drops occurring during the month. Market calamities can become a self-fulfilling prophecy, so stay on the lookout and don’t get whipsawed if it happens.
(CLICK HERE FOR THE CHART!)
Pre-election year Octobers are ranked second from last for DJIA, S&P 500 and NASDAQ while Russell 2000 is dead last with an average loss of 1.9%. Eliminating gruesome 1987 from the calculation provides only a moderate amount of relief. Should a meaningful decline materialize in October it is likely to be an excellent buying opportunity, especially for depressed technology and small-cap shares.

Where’s That September Volatility?

September is historically known as one of the worst for stocks, yet in 2019 the S&P 500 Index is up 2.7% so far amid a sea of scary headlines. Incredibly, the S&P 500 has wavered less than 0.1% from its previous close 6 of the past 10 trading sessions, as it consolidates just beneath all-time highs.
“Over the past two weeks we’ve had the European Central Bank meeting, the Federal Reserve meeting, higher inflation, a historic jump in crude oil, Middle East turmoil, trouble in the repo market, and even multiple NFL quarterbacks sustaining major injuries,” said LPL Financial Senior Market Strategist Ryan Detrick. “Yet, with all of those scary headlines, stocks are actually in the midst of one of the least volatile two-week stretches we’ve seen in years.”
We are quite encouraged by the overall change in market tone we’ve heard recently, with more cyclical names taking the baton and leading, but with the S&P 500 up near our fair value target of 3,000, we would be on the lookout for this sea of tranquility to get rougher at any time. In fact, according to historical calendars, we may need to be on high guard for the second half of September.
As shown in the LPL Chart of the Day, The Second Half of September Can Be Tricky For Stocks, later in the month of September is when we’ve seen seasonal weakness. Things have been going well for equities in the face of some worrisome headlines, but don’t get complacent, as the calendar could be one of the biggest near-term risks.
(CLICK HERE FOR THE CHART!)

The Fed Hits It Down The Middle

“History does not repeat itself, but it rhymes.” Mark Twain
As expected, the Federal Reserve’s (Fed) policy committee cut its policy rate by 25 basis points (.25%) to a target range of 1.75%–2%. This comes on the heels of the first rate cut in more than 10 years at the end of July. This cut is somewhat more controversial, however, because the overall U.S. economic data has been improving, and there’s been a tick higher in inflation.
One of the most important questions heading into this meeting was how many voting Fed members would support additional rate cuts. There were two dissenting voting members at the July rate cut, and once again there were two votes opposed to today’s cut—but unlike last time, there was also one dissenter who favored a larger 50 basis point (.50%) cut. Materials in the economic projections indicated 10 of 17 participants (which includes non-voting members) did not believe additional cuts would be needed over the remainder of the year, although evolving economic conditions could certainly lead to a shift.
As the quote from Mark Twain suggests, by looking back at history we can potentially find clues as to what might happen in the future.
Looking back at the previous two recessions (2001 and 2008), the Fed cut rates 50 basis points (.50%) to kick off the new cycle of rate cuts. We looked back at what the Fed said at the time, and policymakers didn’t foresee a recession; the larger .50% cut might have been their way of showing how worried they really were at the time. In other words, maybe the Fed knew there potentially was trouble under the surface.
Compare this with three consecutive 25 basis point (.25%) cuts in the 1995/1996 and 1998 rate cut cycles, which led to continued equity gains and avoided recessions. Given we foresee one more cut this year, could it be another three cuts of 25 basis points (.25%) and then an economic acceleration?
“Here’s the catch. When the first two cuts in a new cycle of rate cuts are only 25 basis points, this could be the Fed’s way of truly viewing the cuts as insurance,” explained LPL Financial Senior Market Strategist Ryan Detrick. “In fact, the past five cycles of cuts that started with two 25 basis point cuts saw the S&P 500 Index move higher 6 and 12 months later every single time.”
As shown in the LPL Chart of the Day, Stocks Have Historically Done Well If The First Two Fed Rate Cuts Are 25 Basis Points, the S&P 500 was up an average of 9.7% six months after the second of two 25 basis point cuts to kick off a new cycle of rate cuts. Going out a year, the S&P 500 had gained a very impressive average of 16.7%.
(CLICK HERE FOR THE CHART!)

Strong Start for September, but Second Half Could Bring Trouble

As of Friday’s close the market is well above historical average performance in September. DJIA was up nearly 3.1%, S&P 500 was up 2.8%, NASDAQ and Russell 1000 were up 2.7% while Russell 2000 was up 5.6%. Small-caps outperforming large-caps recently is not unusual and they did so again today. However, the second half of September has historically been weaker than the first half. The week after options expiration week can be treacherous with S&P 500 logging 23 weekly losses in 29 years since 1990. End-of-quarter portfolio restructuring, and window dressing can amplify the impacts of any negative headlines.
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Broader Transports Still Outperforming YTD

With shares of FedEx (FDX) on pace for their second worst earnings reaction day since at least 2001, the Dow Transports, an index in which FDX has a weighting of over 8% (after today's decline), is down close to 2%. Historically, the Transports have been considered a leading indicator of the economy, so the weakness in FDX, and by extension, the Dow Transports, is resulting in heightened concerns over the state of the economy. Looking at the chart below, the picture for the Transports doesn't look pretty. The timing of today's decline couldn't have been worse as it came just as the Transports were attempting to break above the highs from July, but now it just looks like the second lower high this year. Following today's declines, the Dow Transports are up 14.7% YTD which is about five percentage points behind the performance of the S&P 500.
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Given the changes in the US economy over time, we've been skeptical of the continued predictive ability of the Transports, but even putting that aside for a moment, a broader look at Transports shows a less pessimistic picture. The chart below shows the performance of the stocks in the S&P 1500 index on an equal-weighted basis so far in 2019. By this measure, today's decline comes after the index made a higher high, and while it's back below those former highs today, with a gain of 20.5% YTD, this broader look at transports is still outperforming the S&P 500 on a YTD basis. It may not be a great picture for this group of transport stocks, but it doesn't really look bad either.
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STOCK MARKET VIDEO: Stock Market Analysis Video for Week Ending September 20th, 2019

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STOCK MARKET VIDEO: ShadowTrader Video Weekly 09.22.19

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Here are the most notable companies (tickers) reporting earnings in this upcoming trading week ahead-
  • $MU
  • $NIO
  • $AZO
  • $KMX
  • $NKE
  • $BB
  • $RAD
  • $CMD
  • $ACN
  • $UXIN
  • $JBL
  • $INFO
  • $CAG
  • $DAVA
  • $MANU
  • $SNX
  • $FDS
  • $KBH
  • $UEPS
  • $ATU
  • $CTAS
  • $MTN
  • $AGTC
  • $WOR
  • $PIR
  • $ISR
  • $DLNG
  • $CAMP
  • $AIR
  • $FUL
  • $PRGS
  • $CMTL
  • $DYNT
  • $RBZ
(CLICK HERE FOR NEXT WEEK'S MOST NOTABLE EARNINGS RELEASES!)
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Below are some of the notable companies coming out with earnings releases this upcoming trading week ahead which includes the date/time of release & consensus estimates courtesy of Earnings Whispers:

Monday 9.23.19 Before Market Open:

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Monday 9.23.19 After Market Close:

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NONE.

Tuesday 9.24.19 Before Market Open:

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Tuesday 9.24.19 After Market Close:

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Wednesday 9.25.19 Before Market Open:

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Wednesday 9.25.19 After Market Close:

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Thursday 9.26.19 Before Market Open:

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Thursday 9.26.19 After Market Close:

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Friday 9.27.19 Before Market Open:

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NONE.

Friday 9.27.19 After Market Close:

([CLICK HERE FOR FRIDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES!]())
NONE.

Micron Technology, Inc. $49.16

Micron Technology, Inc. (MU) is confirmed to report earnings at approximately 4:05 PM ET on Thursday, September 26, 2019. The consensus earnings estimate is $0.43 per share on revenue of $4.51 billion and the Earnings Whisper ® number is $0.49 per share. Investor sentiment going into the company's earnings release has 67% expecting an earnings beat The company's guidance was for earnings of $0.38 to $0.52 per share. Consensus estimates are for earnings to decline year-over-year by 87.92% with revenue decreasing by 46.56%. Short interest has decreased by 21.7% since the company's last earnings release while the stock has drifted higher by 37.1% from its open following the earnings release to be 23.2% above its 200 day moving average of $39.90. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, September 20, 2019 there was some notable buying of 12,865 contracts of the $50.00 put expiring on Friday, September 27, 2019. Option traders are pricing in a 7.5% move on earnings and the stock has averaged a 7.1% move in recent quarters.

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NIO Inc. $3.04

NIO Inc. (NIO) is confirmed to report earnings at approximately 4:30 AM ET on Tuesday, September 24, 2019. Investor sentiment going into the company's earnings release has 51% expecting an earnings beat The company's guidance was for revenue of $169.00 million to $193.00 million. Short interest has increased by 25.8% since the company's last earnings release while the stock has drifted lower by 26.2% from its open following the earnings release to be 39.6% below its 200 day moving average of $5.03. On Wednesday, September 4, 2019 there was some notable buying of 40,590 contracts of the $1.50 put expiring on Friday, November 15, 2019. Option traders are pricing in a 17.1% move on earnings and the stock has averaged a 9.7% move in recent quarters.

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AutoZone, Inc. -

AutoZone, Inc. (AZO) is confirmed to report earnings at approximately 7:00 AM ET on Tuesday, September 24, 2019. The consensus earnings estimate is $21.64 per share on revenue of $3.94 billion and the Earnings Whisper ® number is $21.98 per share. Investor sentiment going into the company's earnings release has 62% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 16.72% with revenue increasing by 10.71%. Short interest has increased by 23.5% since the company's last earnings release while the stock has drifted higher by 15.1% from its open following the earnings release to be 15.6% above its 200 day moving average of $1,003.22. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 5.8% move on earnings and the stock has averaged a 6.7% move in recent quarters.

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CarMax, Inc. $84.63

CarMax, Inc. (KMX) is confirmed to report earnings at approximately 7:35 AM ET on Tuesday, September 24, 2019. The consensus earnings estimate is $1.33 per share on revenue of $5.03 billion and the Earnings Whisper ® number is $1.38 per share. Investor sentiment going into the company's earnings release has 63% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 7.26% with revenue increasing by 5.54%. Short interest has increased by 0.7% since the company's last earnings release while the stock has drifted lower by 3.6% from its open following the earnings release to be 14.9% above its 200 day moving average of $73.63. Overall earnings estimates have been revised higher since the company's last earnings release. On Friday, September 6, 2019 there was some notable buying of 1,023 contracts of the $92.50 call expiring on Friday, October 18, 2019. Option traders are pricing in a 7.2% move on earnings and the stock has averaged a 6.0% move in recent quarters.

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Nike Inc $86.68

Nike Inc (NKE) is confirmed to report earnings at approximately 4:15 PM ET on Tuesday, September 24, 2019. The consensus earnings estimate is $0.71 per share on revenue of $10.45 billion and the Earnings Whisper ® number is $0.76 per share. Investor sentiment going into the company's earnings release has 65% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 5.97% with revenue increasing by 5.05%. Short interest has increased by 0.4% since the company's last earnings release while the stock has drifted higher by 3.2% from its open following the earnings release to be 5.1% above its 200 day moving average of $82.50. Overall earnings estimates have been revised lower since the company's last earnings release. On Monday, September 16, 2019 there was some notable buying of 4,646 contracts of the $84.00 call expiring on Friday, September 27, 2019. Option traders are pricing in a 5.2% move on earnings and the stock has averaged a 4.5% move in recent quarters.

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BlackBerry Limited $7.54

BlackBerry Limited (BB) is confirmed to report earnings at approximately 7:00 AM ET on Tuesday, September 24, 2019. The consensus estimate is for a loss of $0.01 per share and the Earnings Whisper ® number is $0.01 per share. Investor sentiment going into the company's earnings release has 32% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 150.00% with revenue increasing by 375.71%. Short interest has increased by 1.0% since the company's last earnings release while the stock has drifted lower by 9.2% from its open following the earnings release to be 6.9% below its 200 day moving average of $8.10. Overall earnings estimates have been revised higher since the company's last earnings release. On Tuesday, September 17, 2019 there was some notable buying of 2,012 contracts of the $8.00 call expiring on Friday, September 27, 2019. Option traders are pricing in a 9.9% move on earnings and the stock has averaged a 7.9% move in recent quarters.

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Rite Aid Corp. $7.40

Rite Aid Corp. (RAD) is confirmed to report earnings at approximately 7:00 AM ET on Thursday, September 26, 2019. The consensus earnings estimate is $0.08 per share on revenue of $5.42 billion and the Earnings Whisper ® number is $0.10 per share. Investor sentiment going into the company's earnings release has 50% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 900.00% with revenue decreasing by 0.03%. Short interest has increased by 22.2% since the company's last earnings release while the stock has drifted higher by 5.1% from its open following the earnings release to be 36.4% below its 200 day moving average of $11.64. On Wednesday, September 18, 2019 there was some notable buying of 580 contracts of the $7.00 call expiring on Friday, October 18, 2019. Option traders are pricing in a 20.7% move on earnings and the stock has averaged a 20.5% move in recent quarters.

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Cantel Medical Corp. $85.02

Cantel Medical Corp. (CMD) is confirmed to report earnings at approximately 8:00 AM ET on Monday, September 23, 2019. The consensus earnings estimate is $0.61 per share on revenue of $238.60 million and the Earnings Whisper ® number is $0.61 per share. Investor sentiment going into the company's earnings release has 55% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 1.61% with revenue increasing by 4.26%. Short interest has increased by 47.7% since the company's last earnings release while the stock has drifted higher by 27.5% from its open following the earnings release to be 10.7% above its 200 day moving average of $76.78. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, September 20, 2019 there was some notable buying of 571 contracts of the $90.00 call expiring on Friday, October 18, 2019. Option traders are pricing in a 7.0% move on earnings and the stock has averaged a 6.9% move in recent quarters.

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Accenture Ltd. $193.09

Accenture Ltd. (ACN) is confirmed to report earnings at approximately 6:50 AM ET on Thursday, September 26, 2019. The consensus earnings estimate is $1.71 per share on revenue of $11.08 billion and the Earnings Whisper ® number is $1.74 per share. Investor sentiment going into the company's earnings release has 67% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 8.23% with revenue increasing by 4.11%. Short interest has increased by 23.3% since the company's last earnings release while the stock has drifted higher by 8.0% from its open following the earnings release to be 11.3% above its 200 day moving average of $173.47. Overall earnings estimates have been unchanged since the company's last earnings release. On Friday, September 13, 2019 there was some notable buying of 1,279 contracts of the $115.00 put expiring on Friday, November 15, 2019. Option traders are pricing in a 4.5% move on earnings and the stock has averaged a 4.2% move in recent quarters.

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Uxin Limited $3.26

Uxin Limited (UXIN) is confirmed to report earnings before the market opens on Monday, September 23, 2019. The consensus estimate is for a loss of $0.09 per share. Investor sentiment going into the company's earnings release has 66% expecting an earnings beat The company's guidance was for revenue of $130.00 million to $137.00 million. Consensus estimates are for earnings to decline year-over-year by 200.00% with revenue increasing by 892.95%. The stock has drifted higher by 44.9% from its open following the earnings release to be 4.5% below its 200 day moving average of $3.41. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, September 20, 2019 there was some notable buying of 509 contracts of the $4.00 call expiring on Friday, October 18, 2019. Option traders are pricing in a 24.5% move on earnings and the stock has averaged a 10.5% move in recent quarters.

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DISCUSS!

What are you all watching for in this upcoming trading week?
I hope you all have a wonderful weekend and a great trading week ahead stocks.
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