Stocks were lower at the open on Friday with the Dow dropping 72 points, or 0.2%. The S&P 500 fell by 0.3%, while the Nasdaq tumbled 0.8%.
Amazon shares rose to a new all-time high at the open after the e-commerce giant delivered blockbuster earnings results after the bell on Thursday. The company reported first quarter earnings per share of $15.79 on revenue of $108.52, up 44% year-over-year, compared to estimates for earnings per share of $9.54 on revenue of $104.47 billion. Amazon guided for revenue of between $110 billion and $116 billion for the second quarter, implying that it expects its sales momentum to continue. “Business trends remain strong and should continue to do so throughout 2021,” Susquehanna Financial Group analysts said in a note where they raised their price target on the stock to a Street-high $5,500, adding that the second quarter outlook is “even more impressive.”
In other earnings news, Exxon posted a first quarter profit, snapping a four quarter losing streak. The oil giant posted earnings per share of $0.65 on revenue $59.15 billion in revenue, versus estimates for earnings per share of $0.59 on revenue of $54.6 billion. “The strong first quarter results reflect the benefits of higher commodity prices and our focus on structural cost reductions, while prioritizing investments in assets with a low cost of supply,” said Chairman and CEO Darren Woods in a statement. Chevron also reported a beat, posting earnings per share of $0.90 on revenue of $32.03 billion, verses revenue of $30.37 billion expected. “Earnings strengthened primarily due to higher oil prices as the economy recovers,” Chevron Chairman and CEO Mike Wirth said in a statement. “We maintained capital discipline with capital spending down 43% from last year.”
Pfizer and BioNTech have sought authorization for their COVID-19 shot to be used in children ages 12 to 15 in the EU, and said they should have data on how well the vaccine works in kids ages 5 to 11 as soon as the end of this summer. The shot is already approved for teens as young as 16. “We expect the data at the end of the summer or autumn of this year” for how the works for children as young as 5, said Dr. Ozlem Tureci, co-founder and chief medical officer of BioNTech. “We will then file it with the regulators and, depending on how fast they react, but he end of the year we might get approval to also immunize younger children.”
DoorDash, Lyft, and Uber are all down this morning after Secretary of Labor Marty Walsh said yesterday that gig workers should be classified as company employees. “We are looking at it but in a lot of cases gig workers should be classified as employees… in some cases they are treated respectfully and in some cases they are not and I think it has to be consistent across the board,” Walsh said. “These companies are making profits and revenue and I’m not (going to) begrudge anyone for that because that’s what we are about in America. But we also want to make sure that success trickles down to the worker.”
And Apple is accused of abusing its “dominant position” in the distribution of music streaming apps through its App Store, the European Commission said today. “Our preliminary finding is that Apple exercises considerable market power in the distribution of music streaming apps to owners of Apple devices. On that market, Apple has a monopoly,” said Margrethe Vestager, the head of competition policy in the EU. “(Apple) not only controls the only access to apps on Apple devices, it also offers a music streaming service, Apple Music, that competes with other apps available in the Apple App Store, such as Spotify or Deezer. This significant market power cannot go unchecked as the conditions of access to the Apple App Store are key for the success of app developers.”
Stocks We’re Watching
Overstock.com Inc (NASDAQ: OSTK): Overstock shares are up 7% at the time of writing after the retailer posted first quarter results, reporting total net revenue of $660 million, up 94% year-over-year. “On the heels of a record 2020, Overstock continues to execute consistently and delivered strong results for the first quarter of 2021,” said Overstock CEO Jonathan Johnson. “Our strong momentum reflects our purposeful and strategic focus on our home business and the operational changes we’ve made and continue to put in place. For the first quarter, our net revenue increased by 94%, and our active customers nearly doubled again. Our focus on improving the customer experience and making our brand vision of ‘Dream Homes for All’ a reality is paying off. In addition, our strategic partnership with Pelion Venture Partners for oversight of Medici Ventures’ blockchain assets closed ahead of schedule and we believe it will provide the portfolio companies the opportunities they need to succeed. We have had another great quarter of profitable market share growth! We believe Overstock is well positioned to sustain this profitable path through 2021 and beyond. I look forward to providing a full update on our first quarter performance during our earnings call.”