Micron, Levi’s loses after earnings on the market

Wednesday, June 26, 2024

Markets ended the day mostly in the green. The Nasdaq and S&P 500 benefited from this Amazon AMZN hit a record closing high (and a market capitalization above $2 trillion for the first time) and ended the session +0.49% and +0.16%, respectively. The Dow barely ended the trading day higher, +0.04%, while the small-cap Russell 2000 pared losses, losing 0.33% during the session. The Dow remains the only major index to rise over the past five trading days.

Selling a new house Today, May’s data was released. It was a big miss on expectations—619,000 new homes sold in the month compared to the 640,000 forecast—but that was accelerated by a significant revision for April, from the original 634,000 to 698,000. The May data is the lowest since last November, but the revised April data is the highest since last July. Declines were seen across the board, from the Northeast (-43.8% to 18,000 new homes sold) to the Midwest (-8.6% to 85,000). The median price was $417,400, and the average sales price was $520,000.

After today’s closing bell, Micron MU did not release financial results for the third quarter. Semiconductors and AI performed better on both earnings and earnings fronts, with earnings of 62 cents per share topping the Zacks Consensus Estimate of 50 cents, and revenues of $6.81 billion easily topping analysts’ expectations of $6.70 billion , which means an increase of 17%. Shares fell -9% immediately after the news, perhaps based on guidance for the current quarter. If your stock price is up +70% year to date, your stock price is probably perfect. MU stock is currently down to -5% or thereabouts in late trading.

Levi Strauss & Co. This afternoon, LEVI also published its financial results. The company rose 5 cents to 16 cents per share, four times higher than the year-ago report, while quarterly sales missed estimates slightly at $1.44 billion. Direct-to-Consumer grew 8% this quarter, and the dividend yield also increased 8%. However, the stock fell -14% on this news – again after a strong gain from the previous year (+42%). We are looking for tips on the upcoming teleconference during which we may be able to stop the bleeding.

Tomorrow morning we will know new economic data. These include the second revision of first-quarter GDP – which is expected to increase by 10 basis points (bps) to +1.4% – and durable goods orders for May, along with the usual weekly jobless claims and continuing claims. Earnings reports are also coming in slowly, with Walgreens Boots Alliance WBA before the opening bell and NIKE NKE after the close.

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