J.P. Morgan quant's 20 highest beta stocks in the S&P 500

Beta measures stock price volatility and a high-beta stock (with a beta above 1.0) tends to more risky with greater potential reward. Investors are now flocking to high-beta names after previously crowding into momentum stocks (due to megacap and AI fear of missing out) in January and low volatility in April (on worries about tariffs, a recession and AI overspending).

 

1. Super Micro Computer (SMCI), beta score 3.37
2. Coinbase Global (COIN), 2.82
3. Palantir Technologies (PLTR), 2.41
4. Monolithic Power Systems (MPWR), 2.39
5. Broadcom (AVGO), 2.35
6. Nvidia (NVDA), 2.32
7. Micron Technology (MU), 2.30
8. Western Digital (WDC), 2.19
9. Arista Networks (ANET), 2.17
10. AMD (AMD), 2.13
11. Dell (DELL), 2.08
12. Vistra (VST), 2.00
13. Lam Research (LRCX), 1.98
14. Microchip Technology (MCHP), 1.92
15. Crowdstrike (CRWD), 1.91
16. KKR (KKR), 1.90
17. Teradyne (TER), 1.88
18. KLA (KLAC), 1.87
19. Carnival (CCL), 1.87
20. Tesla (TSLA), 1.86

• by vol https://finviz.com/screener.ashx?v=211&ta=0&o=-volume&t=AMD,ANET,AVGO,CCL,COIN,CRWD,DELL,KKR,KLAC,LRCX,MCHP,MPWR,MU,NVDA,PLTR,SMCI,TER,TSLA,VST,WDC

     

     

     

 

                   

Unusual Options Activity Fri 10/6/23

 

The following options are exhibiting notable trading, potentially indicating changing sentiment toward the underlying stocks, and/or potentially representing positioning for increased volatility.

Bullish Call Activity:

• MU Oct 68 calls (volume: 3940, open int: 8070, implied vol: ~67%, prev day implied vol: 46%).  2K traded in a single transaction. Co starting construction on memory fab in Idaho; expected to come online in phases starting in 2025, with DRAM production ramping over the second half of the decade. Co is expected to report earnings late December. 
• QCOM Oct 110 calls (volume: 3020, open int: 760, implied vol: ~43%, prev day implied vol: 35%). The Biden administration is expected to soon tighten chip tool restrictions against China. Co is confirmed to report earnings November 1 after the close.
• AVGO Oct 840 calls (volume: 1920, open int: 640, implied vol: ~37%, prev day implied vol: 34%). Co is expected to report earnings mid-November.
  

Bearish Put Activity:

• UPST Oct 25 puts (volume: 2610, open int: 410, implied vol: ~159%, prev day implied vol: 100%). Co is expected to report earnings early November.
• SIRI Nov 4 puts (volume: 10.4K, open int: 10, implied vol: ~91%, prev day implied vol: 88%). 2500 contracts traded in a single transaction. Co is confirmed to report earnings November 3 before the open.

Sentiment: The CBOE Put/Call ratio is currently: 1.30, VIX: (17.64, -0.85, -4.6%).
October 20 is options expiration -- the last day to trade October equity options.

Appaloosa Management : top 5 buys in the 4th quarter

David Tepper, founder of Appaloosa Management, disclosed last week that his fund's top five buys during the fourth quarter of 2019 included a new holding in Intelsat SA (NYSE:I) and position boosts in four companies: Alibaba Group Holding Ltd. (NYSE:BABA), Micron Technology (NASDAQ:MU), Energy Transfer LP (NYSE:ET) and Amazon.com Inc. (NASDAQ:AMZN).

A distressed debt specialist, Tepper became interested in the stock market as a young boy watching his father trade stocks in his hometown of Pittsburgh. The Appaloosa fund manger has since earned international reputation for producing some of the highest returns among fund managers on Wall Street.

According to CNBC sources, Tepper announced in May 2019 that he plans to convert Appaloosa into a family office so that he can concentrate on managing the Carolina Panthers NFL football franchise, which he purchased for over $2.27 billion in 2018. As of December 2019, the $3.94 billion equity portfolio contains 22 stocks, with turnover of 13%. The top three sectors in terms of portfolio weight are communication services, consumer cyclical and technology, with weights of 31.53%, 30.05% and 17.39%.

New buy: Intelsat

Appaloosa purchased 2,885,019 shares of Intelsat, giving the stake 0.51% weight in the equity portfolio. Shares averaged $15.33 during the quarter.

The Luxembourg-based telecom company provides diversified communication services to media companies, fixed and wireless telecom operators and data networking service providers. According to GuruFocus, Intelsat's interest coverage and debt ratios underperform over 90% of global competitors, suggesting low financial strength.

Charts 6 months later: 

• Intelsat SA (NYSE:I) is trading over the counter

https://finviz.com/screener.ashx?v=211&t=I,BABA,MU,ET,AMZN&ta=0&p=w&o=-change

-=Micron (MU) reported earnings on Thur 26 Sept 19 (a/h)

•  The stock was up over 50% in 2019 heading into the report. 

Micron beats by $0.08, beats on revs; guides Q1 EPS in-line, revs above consensus; Sees FY20 CapEx in the range of $7-8 bln

Reports Q4 (Aug) earnings of $0.56 per share, excluding non-recurring items, $0.08 better than the S&P Capital IQ Consensus of $0.48 (Guidance $0.38-0.52); revenues fell 42.3% year/year to $4.87 bln vs the $4.56 bln S&P Capital IQ Consensus (Guidance $4.3-4.7 bln).

• Gross Margin 30.6% (Guidance 27.5-30.5%)
• Operating Expenses $745 mln (Guidance $760-810 mln)
• Free Cash Flow $263 mln.

Co issues guidance for Q1, sees EPS of $0.39-0.53, excluding non-recurring items, vs. $0.49 S&P Capital IQ Consensus; sees Q1 revs of $4.8-5.2 bln vs. $4.78 bln S&P Capital IQ Consensus.

• Gross Margin in the range of 25-28%.
• Sees CapEx in the range of $7-8 bln; Co had said it would be down meaningfully from the $9 bln in 2019.

"We are encouraged by signs of improving industry demand, but are mindful of continued near-term macroeconomic and trade uncertainties. As markets recover, Micron is well positioned to address the robust secular demand for memory and storage solutions."

Micron -- DRAM and NAND Outlooks

DRAM

• CY-19 industry bit demand growth remains unchanged at mid-teens, with supply exceeding demand
• CY-20 industry bit demand growth of high-teens to 20%, above supply growth of only mid-teens
• Long-term bit demand growth CAGR of mid-to-high teens

NAND

• CY-19 industry bit demand growth in the low-to-mid 40% range, which will exceed bit supply growth of approximately 30%
• CY-20 industry bit demand growth of high-20s to low-30% range, with supply growing somewhat below demand
• Long-term bit demand growth CAGR in low-30% range

Micron- Huawei Commentary

In the fiscal fourth quarter, sales to Huawei declined sequentially and were down meaningfully from the levels we anticipated prior to the addition of Huawei to the Entity List

We have applied for licenses with the U.S. Department of Commerce that would allow us to ship additional products, but there have been no decisions on those licenses to date

If the Entity List restrictions against Huawei continue and we are unable to get licenses, we could see a worsening decline in our sales to Huawei over the coming quarters

Read more: http://hosting.briefing.com/cschwab/InDepth/InPlay.htm#ixzz60kaKalQr

Earnings this week : Sept 23 - 27, 19 (wk 39)

Monday (Sept 23)

• Morning: CMD UXIN

Tuesday (Sept 24)

• Morning: AZO BB KMX INFO JBL MANU NEOG NIO
• Afternoon: CTAS NKE SNX

Wednesday (Sept 25)

• Morning: DAVA WOR
• Afternoon: AIR FUL KBH

Thursday (Sept 26)

• Morning: ACN ATU CAG FDS, CCL
• Afternoon: CAMP MTN MU PRGS UEPS

Friday (Sept 27) 

• None

Notable earnings reports:: Ascena Retail Group (NASDAQ:ASNA) on September 23; Nike (NKE), Blackberry (BB), AutoZone (NYSE:AZO), Nio (NYSE:NIO) and CarMax (NYSE:KMX) on September 24; AAR (NYSE:AIR) and KB Home (NYSE:KBH) on September 25; Micron (MU), Carnival (NYSE:CCL), Rite Aid (NYSE:RAD) and ConAgra Brands (NYSE:CAG) on September 26.

***

President Trump will meet with Japanese Prime Minister Shinzo Abe in the week ahead at the annual United Nations General Assembly amid high expectations that a trade deal will be finalized. Heading into the meeting, Tokyo reportedly wants written assurances from Washington that it will not impose hefty tariffs on its auto exports before a finalized deal on farm goods and digital trade is inked. The vibe from the Trump-Abe meeting could impact trading on Nissan (OTCPK:NSANY), Subaru (OTCPK:FUJHY), Toyota (NYSE:TM) and Honda (NYSE:HMC). Meanwhile, economic reports on new home sales, durable goods and consumer spending will give investors a good idea where Q3 stands, while the final reading on Q2 GDP will put a period on the last quarter.

=Micron (MU) reported earnings on Tue 25 June 19 (a/h)

Micron beats by $0.26, beats on revs; Seeing early signs of demand improvement but will reduce 2020 CapEx spend

• Reports Q3 (May) earnings of $1.05 per share, excluding non-recurring items, $0.26 better than the S&P Capital IQ Consensus of $0.79; revenues fell 38.6% year/year to $4.79 bln vs the $4.7 bln S&P Capital IQ Consensus.
• "Micron's improved competitive position and strong execution helped us deliver solid results despite a challenging environment," said Micron Technology President and CEO Sanjay Mehrotra. "While we are seeing early signs of demand improvement, we plan to reduce our capital expenditures in fiscal 2020 to help improve industry supply-demand balance."

Earnings this week : June 24 - 28, 19 (wk 26)

Earnings confirmed for this week

Monday (June 24)

• None

Tuesday (June 25)

• Morning: BNED FDS LEN
• Afternoon: AVAV FDX MU SNX

Wednesday (June 26)

• Morning: ATU BB GIS INFO PAYX SCHN UNF
• Afternoon: FUL MLHR KBH WOR

Thursday (June 27)

• Morning: ACN APOG CAG GMS MKC PDCO SJR WBA
• Afternoon: CAMP NKE PRGS SGH

Friday (June 28) 

• Morning: STZ JKS

Notable earnings reports: Micron (NASDAQ:MU), FedEx (NYSE:FDX), Lennar (NYSE:LEN) and FactSet Research (NYSE:FDS) on June 25; Rite Aid (NYSE:RAD), Blackberry (NYSE:BB), National Beverage (NASDAQ:FIZZ) and General Mills (NYSE:GIS) on June 26; Nike (NYSE:NKE), Walgreen Boots Alliance (NASDAQ:WBA) and ConAgra Brands (NYSE:CAG) on June 27; Constellation Brands (NYSE:STZ) on June 28.

Spotlight on FedEx: Analysts expect FedEx (FDX) to report revenue of $17.88B and EPS of $4.39 with its FQ4 report. JPMorgan turned some heads by predicting that FedEx would clear the decks with below-consensus guidance across the board. FedEx conference call topics will run the course from fuel costs, tariff headwinds, wage inflation pressure to Amazon. Naturally, shares of UPS (NYSE:UPS) could see a jolt if FedEx surprises to the upside or downside with guidance. So far this year, shares of FedEx are up 4.1% to trail the 5.7% gain for UPS.

Playing Nike earnings: Nike (NKE) is expected to report revenue of $10.2B and EPS of $0.66 when it reports on July 27. Oppenheimer thinks Nike's stepped up investment spending could drag down FQ4 profit and the company's full-year guidance to act as a near-term negative catalyst for shares. "We recommend clients use any share price weakness in NKE as a buying opportunity. In our view, higher costs at the company are strategic in nature and will help to further enhance the prowess of the brand, over time," advises the firm. Foot Locker (NYSE:FL), Under Armour (NYSE:UAA) and Adidas (OTCQX:ADDYY) have all been known to swing up or down with Nike on earnings day.