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Markets Up, Revert Back to Blue Chips, CSCO Beats in Q4
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Wednesday, August 14th, 2024
Markets continued to make gains today, following a favorable Consumer Price Index (CPI) report for July and a solidifying notion that a rate cut from the Fed is on the way at its September meeting. After some erratic jumping around today, the Dow closed +242 points, +0.61%, while the Nasdaq barely eked out a green finish: +5 points, +0.03%. The S&P 500 and small-cap Russell 2000 were mixed: +0.38% on the former, -0.46% on the latter.
At +2.9%, July CPI year over year — the Inflation Rate — was the lowest in a year and a half. This followed the +2.2% on Tuesday from its sister survey, the Producer Price Index (PPI). Also after a little jostling, bond yield rates settled down somewhat today, with the 10-year at +3.84% and 2-year at +3.96%. In all, we’re keeping with our much better behaved trading week compared to last week’s VIX-distorted adventure.
Cisco Shares Jump +6% on Q4 Beats
Zacks Rank #2 (Buy)-rated Cisco Systems (CSCO - Free Report) outpaced fiscal Q4 estimates this afternoon, with earnings of 87 cents per share beating the Zacks consensus by 2 cents. This is not a surprise at all; Cisco has not missed earnings estimates in a decade or more. Revenues of $13.6 billion in the quarter improved over the expected $13.52 billion, though still down year over year.
Yet Cisco stock is up +6% in late trading largely on improved guidance, both for next quarter and the full year on the top line. Fiscal Q1 earnings are expected in the range of 86-88 cents per share, up from the 84 cents consensus, and $13.65-13.85 billion on sales, nicely above the $13.57 billion anticipated. For fiscal 2025, $3.25-3.58 per share is actually below the $3.71 in the Zacks consensus, while revenues of $55.0-56.2 billion expected are an improvement on the $53.68 billion estimate.
Thursday: Big Day for Economic Data
Tomorrow morning, aside from the normal Weekly Jobless Claims numbers, we’ll get a slew of other economic metrics. These include Retail Sales for July — expected up +0.3% from the previous month’s 0.0% — Empire State/Philly Fed surveys for August, Imports/Exports for July, and Industrial Production/Capacity Utilization, also for July. After the opening bell, we’ll get a fresh look at Business Inventories.
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Markets Up, Revert Back to Blue Chips, CSCO Beats in Q4
Wednesday, August 14th, 2024
Markets continued to make gains today, following a favorable Consumer Price Index (CPI) report for July and a solidifying notion that a rate cut from the Fed is on the way at its September meeting. After some erratic jumping around today, the Dow closed +242 points, +0.61%, while the Nasdaq barely eked out a green finish: +5 points, +0.03%. The S&P 500 and small-cap Russell 2000 were mixed: +0.38% on the former, -0.46% on the latter.
At +2.9%, July CPI year over year — the Inflation Rate — was the lowest in a year and a half. This followed the +2.2% on Tuesday from its sister survey, the Producer Price Index (PPI). Also after a little jostling, bond yield rates settled down somewhat today, with the 10-year at +3.84% and 2-year at +3.96%. In all, we’re keeping with our much better behaved trading week compared to last week’s VIX-distorted adventure.
Cisco Shares Jump +6% on Q4 Beats
Zacks Rank #2 (Buy)-rated Cisco Systems (CSCO - Free Report) outpaced fiscal Q4 estimates this afternoon, with earnings of 87 cents per share beating the Zacks consensus by 2 cents. This is not a surprise at all; Cisco has not missed earnings estimates in a decade or more. Revenues of $13.6 billion in the quarter improved over the expected $13.52 billion, though still down year over year.
Yet Cisco stock is up +6% in late trading largely on improved guidance, both for next quarter and the full year on the top line. Fiscal Q1 earnings are expected in the range of 86-88 cents per share, up from the 84 cents consensus, and $13.65-13.85 billion on sales, nicely above the $13.57 billion anticipated. For fiscal 2025, $3.25-3.58 per share is actually below the $3.71 in the Zacks consensus, while revenues of $55.0-56.2 billion expected are an improvement on the $53.68 billion estimate.
Thursday: Big Day for Economic Data
Tomorrow morning, aside from the normal Weekly Jobless Claims numbers, we’ll get a slew of other economic metrics. These include Retail Sales for July — expected up +0.3% from the previous month’s 0.0% — Empire State/Philly Fed surveys for August, Imports/Exports for July, and Industrial Production/Capacity Utilization, also for July. After the opening bell, we’ll get a fresh look at Business Inventories.