Central Banks And More Earnings

Good Morning Everyone!

Especially Mark Zuckerberg who stopped hanging out in the metaverse. Cut costs and returned to cash flow positive. Stock up 20% pre-market set to gain $200 billion.

Next catalyst, AI?

Prices as of 4 pm EST, 2/1/23; % YTD

MARKET UPDATE

The U.S. Federal Reserve delivered an expected 25 basis point hike

Signals a “couple” more hikes before a pause

ECB

Delivers 50 basis point hike
Signals more hikes ahead

Bank of England

Raised by 50 basis points to 4%
10^th consecutive increase
Like the Fed, close to a pause

Crude 76 -0.5%

Meta (NASDAQ:META) +19%

Q4 revenue 32.2 billion at high end of guide $30-32.5
Ad revenues up 2% y/y
Q1 revenue guide $26-$28.5 Billion vs $27B consensus
2023 operating expenses comes down to $89-95B from $94-100B
After repurchasing $7 billion of stock in Q4, buyback increased by $40 billion
How big is $40 billion. It’s 10% of the market cap.
Don’t bet against Zuck
Solid revenue, Solid guide, larger than expected capex cut, big share buyback
Chart: Average Revenue per user (ARPU)
People are using Meta products. Ad impressions up 23% y/y. Reels is having an impact.

Auto

U.S. January SAAR 16.2 million units vs. street 15.3
Incentives down 22.9% at $1,400 per car
Days supply is 37 vs. 33 last month

Earnings

MetLife (NYSE:MET) flat EPS $1.55 vs street $1.65
McKesson (NYSE:MCK) -2% raised 2023 EPS guide
Alfac (NYSE:AFL) flat EPS $1.29 vs street $1.21
Corteva (NYSE:CTVA) -2% guide lower than street
Allstate (NYSE:ALL) flat Auto loss ratio worse than street
Align (NASDAQ:ALGN) +17% revenues down but better than street, $1 cash reserves
Eli Lilly (NYSE:LLY) -2% top line miss, bottom line beat
Merck (NYSE:MRK) -1% EPS $6.90 beat street $6.35, raised guide
Shell (NYSE:SHEL) +2% record profits of $42.3 billion, increased dividend and share buyback
Bristol-Myers (NYSE:BMY) +1% Q4 revenues +2%, earnings +5%, 2% increase to guide
ConocoPhillips (NYSE:COP) -1% 4% cash flow beat, capex modestly higher
Honeywell (NASDAQ:HON) -3% EPS in line, guide light
Sony (NYSE:SONY) +2% in-line, boosts guide
Estee Lauder (NYSE:EL) -3% guide is light
Ferrari (NYSE:RACE) +5% revenue and EBITDA beat

Tonight

Apple (NASDAQ:AAPL)
Google (NASDAQ:GOOGL)
Amazon (NASDAQ:AMZN)
Starbucks (NASDAQ:SBUX)

CRYPTO UPDATE

99-year old Charlie Munger on crypto

“Instead, it’s a gambling contract with a nearly 100% edge for the house, entered into in a country where gambling contracts are traditionally regulated only by states that compete in laxity”
“The U.S. should now enact a new federal law that prevents this from happening”

Alameda Research