Stock Market Futures Give Back Gains After Economic Prints Paint Mixed Picture On The Economy
U.S. stock futures are in the red on early Wednesday morning. This follows an overall positive session for the broader stock market. In fact, the S&P 500 index closed at levels last seen back in January 2022. Meanwhile, the tech-heavy Nasdaq composite gained by over 1.8%. Not to mention, investors are also likely still considering the latest batch of economic data from yesterday. This would include the lackluster job openings figures and better-than-expected consumer confidence reading.
Providing some insight regarding all this is Ian Shepherdson, the chief U.S. economist at Pantheon Macroeconomics. Shepherdson starts by saying, “We expect a clear downshift in inflation expectations in the second half of the year, but they could easily rise further in the near term.” He also adds, “The survey sends mixed signals on the state of the economy but, always, remember that sentiment is not the same as spending, which is what matters.” Aside from all this, we also have plenty of exciting stock market news on tap today. As of 6:44 a.m. ET, the Dow, S&P 500, and Nasdaq futures are trading lower by 0.28%, 0.33%, and 0.48% respectively.
Lululemon Posts Stellar Earnings In Holiday Quarter Update; Reveals $1 Billion Share Buyback Program
Among the top head turners in the stock market now would be Lululemon (NASDAQ: LULU). In brief, the Canadian athletic apparel retailer is likely attracting investors after posting its fourth fiscal quarter earnings. Diving in, the company is looking at a total quarterly profit of $434.5 million. This adds up to an adjusted earnings of $3.37 per share, topping consensus expectations of $3.27. However, Lululemon reported a total revenue of $2.13 billion, just shy of the $2.14 billion target.
In the larger scheme of things, Lululemon is topping off a great fiscal year with these admirable results. For the full year, the company’s profits soared by 65.6% year-over-year to $975.3 million. Also, its revenue is up by 42% over the same period, totaling $6.26 billion, a record high. According to CEO Calvin McDonald, all of this is a testament to the resilience of the Lululemon brand. It also indicates the company’s capability in delivering sustained growth across its core operations.
Despite its current momentum, the company is not planning to slow down anytime soon on the operational front. This is evident from the company’s outlook for the current quarter. As it stands, the company is expecting earnings of $1.38 to $1.43 per share alongside sales of between $1.52 billion to $1.55 billion. Worth noting, this is well above Wall Street’s estimates of $1.28 and $1.41 billion respectively. As Lululemon looks to go from strength to strength, LULU stock would be front and center in the stock market today.
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Micron Rises After Topping Quarterly Financials And Guidance Estimates
Micron (NASDAQ: MU) is also grabbing stock market headlines now following its latest quarterly financial update. Overall, the company posted solid results across the board. In essence, Micron is looking at earnings of $2.00 a share on revenue of $7.79 billion. Notably, this tops Wall Street’s forecasts of $1.98 and $7.53 billion respectively. On top of that, Micron also brought in $3.63 billion in operating cash flow throughout the quarter. This adds up to a year-over-year increase of about 18%.
Highlighting Micron’s commendable performance for the quarter is CEO Sanjay Mehrotra. He says, “Micron’s excellent second-quarter results exceeded the high end of our guidance for both revenue and margin, reflecting our strong execution.” Additionally, Mehrotra also notes that Micron continues to lead the industry via its computer data storage offerings. This, in turn, is translating to persisting momentum in its product portfolio. In closing, the CEO argues, “With outstanding first-half results, Micron is on track to deliver record revenue and robust profitability in fiscal 2022.” Now, as the emphasis on hybrid work arrangements increases, demand for Micron’s core data storage hardware would follow suit.
Looking forward, the company’s guidance for the current quarter is worth noting as well. For now, Micron is expecting revenue to come in between $8.5 billion to $8.9 billion. Moreover, it is also guiding for an earnings per share within the range of $2.36 and $2.56 per share. Respectively, consensus estimates are pointing towards a revenue of $8.16 billion alongside earnings of $2.25 per share. After considering all of this, it seems that Micron is confident in its ability to perform. Because of that, I could see investors tuning in to MU stock at today’s opening bell.
FedEx CEO Frederick Smith On The Company’s AV Truck Plans
Meanwhile, logistics titan FedEx (NYSE: FDX) is eyeing a new frontier of tech for its delivery fleet. Namely, CEO Fred Smith recently spoke about the company’s plans for autonomous vehicle (AV) tech with CNBC’s Jim Cramer. In the interview, Smith notes that FedEx is making huge strides in its AV delivery fleet efforts. The likes of which he says will bear fruit later this summer. In particular, the CEO points out that these AV trucks will primarily operate over the highway. This would serve to better optimize FedEx’s fleet as its drivers can focus on pickup and delivery in urban areas.
All in all, such a move would serve to benefit FedEx amidst the current labor shortages. Smith also speaks on how the company plans to maintain its current driver count even with autonomous delivery infrastructure in play. “We are a long way down the road to doing that. But we’re not going to get rid of our drivers. They’ll do the pick-up and delivery and the dredge, if you will, and over time, I’m very confident autonomous trucks are on the way.” With all this in mind, it seems that FedEx is making significant progress from its initial AV delivery truck tests from late 2021. As a result, FDX stock could be worth looking at in the stock market now.
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UPS To Reinforce Partnership With Google Cloud As New Data Initiatives Commence
In other logistics and transportation industry news, United Parcel Service (NYSE: UPS), or UPS for short, is also making plays. In detail, UPS is building on its current team-up with Alphabet’s (NASDAQ: GOOGL) Google Cloud division. According to the Wall Street Journal (WSJ), UPS is boosting the network storage, and compute capacity in its current subscription. Furthermore, it will also continue to use Google’s artificial intelligence (AI) and machine learning tools to analyze incoming data. This would prove vital as UPS is expecting a surge of data from the introduction of its latest data initiatives. The likes of which include putting radio-frequency identification chips (RFID) on its packages.
According to Juan Perez, the chief information and engineering officer of UPS, “the potential is unlimited.” With the sheer number of packages that UPS handles daily, such a boost to its cloud computing infrastructure would be beneficial. To put things into perspective, the company delivered an average total of over 25 million packages daily in 2021. Not only would the RFID chips provide more details for couriers, but they would also allow for AI to efficiently analyze and record said detail as well. Simply put, UPS will execute all of this via its Harmonized Enterprise Analytic Tool, which it co-developed with Google Cloud. As the company looks to further refine its operations, UPS stock could be in focus.