Cummins (CMI)

Cummins (CMI) beat estimates by $0.04 and raised revenue estimates to 8-11%. For the stock to move higher, it will have to rely on its upper limit.

 cmi

Merger Monday

It’s Monday and that must mean it is Merger Monday. Dollar Tree (DLTR) is buying rival Family Dollar (FDO) for $74.50 which is a 23% premium to Friday’s close.

Merger Monday

 

The Week Ahead

The Dow Jones Industrial Average was lower for the past week while the S&P 100 and the NASDAQ 100 were higher.

1.Geopolitical and Fiscal Events Wednesday sees the FOMC conclude its latest meeting. 2.Economic Releases. Releases of note this week other than the weekly chain store sales, oil/gas numbers, mortgage applications and jobless claims include consumer confidence, Q1 GDP, ADP Payroll, Chicago PMI, Challenger, Gray & Christmas, employment data, construction spending and ISM Manufacturing Survey.

3.Earnings Releases. Notable releases include (in order of day’s reporting with Monday first and Friday last) CMI GGP PFE MRK SU MET XOM BUD CVX BUD among others companies as we continue Q1 earnings. See the earnings section.

 

Futures Slightly Lower

In After Hours Trading

IPOs on deck this week, 21, including Synchrony Financial and HealthEquity. Secondaries on deck will be ad hoch.

IPO Financial provides our capital raise data.

In After Hours Trading (Best to Worst absolute beats/misses [+.02 or greater/-.02 or worse]): none of note.

What’s Happening This Morning

US futures: S&P 500 -1.50, Dow Jones -11 and NDX -1.50 with fair values flatish. Asia higher and Europe mixed. Copper, silver and gold higher. WTI Crude and Brent Oil Futures lower. Natural Gas is lower. $ is lower vs Euro, lower vs. Pound and lower vs. Yen. US 10 year Treasury yield +1. Prices as of 7:55 a.m. EDT.

Earnings Expected

Earnings due after the close (by market cap descending): GGP, EMN, RRC, XL, AGNC, PCL, MAS, JEC, NCLH, HLF, WRB, ARE, PRE, AFG, KRC, CR, CGNX, HLS.

Due Tuesday morning (by market cap descending): PFE, MRK, BP, SAN, UPS, UBS, HMC, NEE, ETN, NOV, ITW, ECL, ADM, RAI, AET, GLW, MMC, HCA, PCAR, MHFI, IP, WYNN, SIRI, WM, NLSN, FIS, ETR, TRW, ALLY, AMG, TLM, LVLT, YNDX, CNX, ST, HRS, UDR, XYL, MLM, ARW, SAVE, WDR, AGCO, OSK, RYN, UTHR, GLPI, IPGP, CRS, AXE, GNC.

Rags & Mags: Inside Wall Street

USA Today: Is President Obama a lame deck too early in second term? Russia ordered to pay $50 billion for breaking up Yukos Oil illegally.

Index ETF Options Volume

Index ETF Options Volume

We are going to highlight unusual options activity as well going forward. The third column from the left will highlight such outliers. SPY had unusual volume and excess put action. Volume was very light for such a volatile day.

[Image 1]

The rows in the options matrix are as follows:
  • Curr Vlm = Current Option Volume for today
  • OpVol20 = 20 day Option Volume average
  • % Delta (sorted descending) = Curr Vlm/ OpVol20 * 100
  • Sym = Symbol
  • 20 HV 100HV 252HV = 20 day, 100 Day and 252 Day Historical Volatility
  • Slope = The slope of the historic vol
  • Delta = Change in slope
  • cOptInt = Call Open Interest
  • pOptInt =Put Open Interest
  • cVolum = Call Volume
  • pVolum = Put Volumed

Stanley Black & Decker (SWK)

Stanley Black & Decker (SWK) reported earnings of $1.43 versus estimates of $1.37 this morning and raised guidance. The stock has been range bound for the last year. There is some nice upside to this name.

swk

The Madison Letter Current Update

Since inception, our overall timing return is 70.92% versus 39.92% on the S&P 500 for excess return of 31.00%.

We began to offer a buy and sell strategy via our Madison Market Timing Indicator at the beginning of April of 2007. There are now 22 open and closed winning trades to 8 closed losing trades with our market timing results. We closed longs on OIH FXI EEM and IYR for gains two weeks ago. We will be left with one long position TRF. We expected to see new ideas this past week but our model anticipated recent weakness and we remain on the sidelines.

madison market timing

Must See TV

Yesterday afternoon at 5:00 p.m. EDT CNBC aired a pre-recorded interview between President Obama and CNBC Reporter Steve Leisman. It is worth watching. The potential for tax reform is there. Tax inversions are the reason. Make sure to watch and become an informed citizen.

Obama Interview

 

Futures Lower

In After Hours Trading

IPOs on deck ContraFact, Innocoll AG, El Pollo Loco Holdings, Ocular Therapeutix, Orion Engineered Carbons S.A. and Advanced Drainage Systems. Secondaries on deck today include AGTC FPI GSJK LOAN .

IPO Financial provides our capital raise data.

In After Hours Trading (Best to Worst absolute beats/misses [+.02 or greater/-.02 or worse]): BIDU+.35, UHS+.30, BCR+.29, RGA+.26, SBAC+.16, CYN+.14, SIVB+.13, DLB+.11, V+.08, CBI+.08, PFG+.07, RFMD+.07, VRSN+.04, ALTR+.04, ALGN+.04, FSL+.03, FLEX+.03, N+.03, RSG+.02, IM+.02, FET+.02, LEG+.02, TPX-.02, MXIM-.05, KLAC-.06, VR-.08, AMZN-.12, CB-.19, WCG-.97

What’s Happening This Morning

US futures: S&P 500 -2.50, Dow Jones -12 and NDX -10.50 with fair values flatish. Asia higher and Europe lower. Copper, silver and gold higher. WTI Crude and Brent Oil Futures lower. Natural Gas is lower. $ is higher vs Euro, higher vs. Pound and higher vs. Yen. US 10 year Treasury yield +1. Prices as of 7:55 a.m. EDT.

Earnings Expected

Earnings due after the close (by market cap descending): none

Due Monday morning (by market cap descending): CMI, WYNN, ROP, TSN, RPM, LECO, AHGP, TEN, ARLP, CMP, AWI

Rags & Mags: Inside Wall Street

USA Today: Fox sells stakes in some European assets to raise cash for Time Warner purchase. China declares Qualcomm (QCOM) a monopoly.

NY Times: Losses pile up at Amazon (AMZN).

Index ETF Options Volume

Index ETF Options Volume

We are going to highlight unusual options activity as well going forward. The third column from the left will highlight such outliers. No stocks had unusual volume and excess put or call action. Volume is very light for such a volatile day.

[Image 1]

The rows in the options matrix are as follows:
  • Curr Vlm = Current Option Volume for today
  • OpVol20 = 20 day Option Volume average
  • % Delta (sorted descending) = Curr Vlm/ OpVol20 * 100
  • Sym = Symbol
  • 20 HV 100HV 252HV = 20 day, 100 Day and 252 Day Historical Volatility
  • Slope = The slope of the historic vol
  • Delta = Change in slope
  • cOptInt = Call Open Interest
  • pOptInt =Put Open Interest
  • cVolum = Call Volume
  • pVolum = Put Volumed