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No Lucky No. 7 for the S&P 500
The Vanguard S&P 500 ETF closed at 544.93 Tuesday, down 0.35%, breaking a six-day winning streak.
Covid-19 Is Still a Thing
The New England Journal of Medicine is today calling for “an evidence-based approach to Covid-19 vaccination” to examine whether there is a benefit to repeat dosing of Covid-19 patients “particularly among low-risk persons who may have previously received multiple doses of Covid-19 vaccines, had multiple Covid-19 infections, or both.” Going forward, the article states that the FDA “anticipates the need for randomized, controlled trial data evaluating clinical outcomes … among healthy persons … with no risk factors for severe Covid-19 … between the ages of 6 months and 64 years … before Biologics License Applications can be granted.”
S&P 500 component Pfizer (NYSE: PFE) stock is up 1.9% on the news. The Vanguard S&P 500 ETF is now down 0.3%.
Big Banks' Mutual Admiration Society
RBC Capital and Morgan Stanley both raised price targets on fellow big banker JPMorgan Chase (NYSE: JPM) this morning, to $285 and $236, respectively, although RBC thinks JPMorgan stock is a buy and MS only rates it equal weight.
RBC expects JPMorgan stock to outperform its peer group over the next 3-5 years. MS agrees there is “plenty of runway for growth ahead.”
Less Love for AES
Is less happy news, electric utility AES (NYSE: AES) got hit by a downgrade from investment bank Jefferies this morning. Citing “the stock’s rerating up +15% in the past week post recent tax bill proposal” resulting in a “pricey multiple,” valuation concerns drove the banker to lower its rating on AES stock to underperform.
This article will be updated throughout the day, so check back often for more daily updates.
The Vanguard S&P 500 ETF (NYSEMKT: VOO) opened down 1% on Tuesday, but quickly bounced back to breakeven, and not all investors are pessimistic. Over in Hong Kong, Chinese battery giant Contemporary Amperex Technology Co., Limited, or “CATL,” has just conducted the largest IPO so far this year, and its stock closed up 16%.
CATL is not listed in the U.S., although it may be possible to buy shares anyway depending on your broker. The company raised $4.6 billion before fees, and closed at the Hong Kong dollar equivalent of $33.63 a share.
Earnings
Here in the U.S., S&P 500 index component Home Depot (NYSE: HD) reported just under $39.9 billion in Q1 revenue this morning, beating expectations. Adjusted earnings came in a bit light at $3.56 per share, but management told investors it still expects to earn more than the $15 consensus by the end of this year, predicting profits will be about $15.24.
Back overseas, business is booming for Israeli drone-maker Elbit Systems (Nasdaq: ESLT), which just reported $2.57 per share in profit, up 42% year over year, growth twice as good as the 22% improvement in its revenue to $1.9 billion.
Analyst Calls
S&P component Hewlett Packard Enterprise (NYSE: HPE) won an upgrade from Evercore ISI this morning. The banker expects HPE to close its acquisition of Juniper Networks (NYSE: JNPR) successfully, leading to “double-digit EPS growth in year 1 through $300M of cost synergies.” Even if the acquisition does not close, though, Evercore thinks “there’s value that could be unlocked” in the company.
A second S&P 500 stock, Kroger (NYSE: KR), won a slight upgrade to hold from Melius Research. Citing “share gains from widespread pharmacy closures,” “limited exposure to tariffs,” and “consistent free cash flow generation,” Melius is warming to the grocery stock, and no longer thinks it’s a sell.
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