Capital One Financial

07.11.2024

iPhone sales boost revenue for chip designer Arm + Qualcomm beats expectations for fourth quarter + Novo Nordisk: weight loss and diabetes drugs flourish + Trump election victory sends bank shares sharply higher + Aurora Cannabis quarterly figures

The chip designer Arm Holdings $ARM (-1,53%) achieved higher sales in the second quarter than in the same period of the previous year. The company benefited from the sale of Apple's $AAPL (-1,1%) iPhones, Arm announced on Wednesday after the close of the US stock exchange. The British chip designer reported a profit of 30 US cents per share for the past quarter, adjusted for share-based payments and other factors. Analysts had expected a profit of 26 cents per share. Arm's turnover rose by five percent to 844 million dollars, compared to analysts' estimates of 808.4 million. However, the company forecast revenue for the current quarter to be only in the middle of estimates. Arm expects revenue to be between $920 million and $970 million, with a midpoint of $945 million, compared to the average analyst estimate of $944.3 million. The company expects third-quarter earnings of between 32 and 36 cents per share. Analysts had projected earnings of 34 cents per share for the third quarter. Arm collects a license fee for every chip sold that uses its technology. Arm's designs power almost every smartphone in the world.

The results of Qualcomm $QCOM (-1,14%) 's fourth-quarter results were better than expected as the chip supplier posted its fifth consecutive quarter of record automotive sales. Adjusted earnings per share rose to $2.69 from $2.02 a year ago, above the $2.57 consensus surveyed by Capital IQ. Non-GAAP revenue rose 18% year-over-year to $10.24 billion in the three months ended Sept. 29, beating Wall Street expectations of $9.93 billion. Qualcomm shares rose 7% in after-hours trading on Wednesday. Sales at Qualcomm's CDMA technology division, which represents its semiconductor business, rose 18% to $8.68 billion, driven by a 68% increase in the auto division to $899 million. Cell phone sales rose 12% to $6.1 billion, while the Internet of Things division increased 22% to $1.68 billion, the company said. Technology licensing revenue rose 21% to $1.52 billion. Qualcomm expects first-quarter adjusted earnings per share of $2.85 to $3.05 on revenue of between $10.5 billion and $11.3 billion.

The pharmaceutical company Novo Nordisk $NOVO B (-0,51%) continues to do good business with its top-selling diabetes and weight-loss drugs Ozempic and Wegovy. Group-wide sales of the Danish company increased by 21 percent to 71.3 billion Danish crowns (around 9.6 billion euros) in the third quarter, as the manufacturer announced in Baegsvaerd on Wednesday. The bottom line profit climbed by a good fifth to 27.3 billion Danish kroner. The Group thus performed better than analysts had expected. The management is now once again narrowing its sales and profit expectations for the year. An increase in revenue at constant exchange rates of 23 to 27 percent is now expected for the year as a whole. This is one percentage point more at the lower end, but also one percent less at the upper end than recently. The Danes are now predicting an increase in operating profit of 21 to 27 percent, excluding exchange rate effects. This means that the Group is also expecting slightly more at the lower end and slightly less at the upper end than before. In the summer, Novo Nordisk had already lowered its target for this key figure.

Donald Trump's clear victory in the US presidential election catapulted the share prices of US banks and financial services providers higher on Wednesday. Goldman Sachs and JPMorgan climbed to record highs in the Dow Jones Industrial benchmark index. Goldman $GS (-1,2%) recently gained around 12 percent, while JPMorgan $JPM (-0,81%) the gain amounted to more than 9 percent. In the S&P 500 Citigroup $C (-1,18%), Wells Fargo $WFC (-0,89%) and Morgan Stanley $MS (-1,15%) were similarly strong. Capital One Financial $COF (-0,58%)gained over 13 percent. A more protectionist trade policy is emerging in the USA under Trump. There is a threat of high import duties and corporate taxes could be lowered. However, debt could also increase. Bank shares benefited on Wednesday from the prospect of looser financial market regulation. In addition, interest rates could rise in view of a possible increase in debt - this would also be to the benefit of banks, for example in the lending business.

Aurora Cannabis figures $ACB (-1,34%)

• Record adjusted EBITDA1 of USD 10.1 million, an increase of 210% year-on-year
• Quarterly net revenue1 increased 29% to $81.1 million, with 41% growth in Global Medical Cannabis
• Reaffirms target of positive free cash flow1 in the quarter ending December 31, 2024
• Maintains a strong balance sheet with ~$152 million in cash and a debt-free cannabis business2

Thursday: Stock market dates, economic data, quarterly figures

ex-dividend of individual stocks

H & M Hennes & Mauritz (B) 3.25 SE

BP 0.08 USD

Ford Motor 0.15 USD

Unilever 0.37 GBP

Quarterly figures / company dates USA / Asia

12:30 Moderna quarterly figures

12:55 Under Armour quarterly figures

22:00 Expedia | News Quarterly figures

Quarterly figures / Company dates Europe

06:45 Adtran Networks | Zurich Insurance | Basler Quarterly figures

07:00 Daimler Truck | Heidelberg Materials | Lanxess | Nemetschek | Nordex | Rational | Arcelormittal | AMS-Osram | Aareal | Hamborner Reit | Knaus Tabbert quarterly figures

07:15 Air France-KLM quarterly figures

07:30 Compugroup | Delivery Hero | Munich Re | Rheinmetall | Telefonica | Adyen | Deutz quarterly figures

07:30 Dürr | Instone | Koenig & Bauer | Mutares | SGL Carbon | SNP Schneider quarterly figures

07:50 Suss Microtec quarterly figures

08:00 Verbund AG | PNE | BT Group | National Grid | CRH Quarterly Figures | Rolls-Royce Trading Update 3Q

10:00 Qiagen quarterly figures

14:30 Hochtief quarterly figures

17:50 Pirelli quarterly figures

18:00 Freenet quarterly figures

Economic data

• 08:00 DE: Trade balance September trade balance calendar and seasonally adjusted FORECAST: +19.0 bn Euro previous: +22.5 bn Euro Exports FORECAST: -2.8% yoy previous: +1.3% yoy Imports FORECAST: -0.2% yoy previous: -3.4% yoy
• 08:00 DE: Production in the manufacturing sector September seasonally adjusted FORECAST: -0.9% yoy previous: +2.9% yoy | Turnover in the service sector October
• 11:00 EU: Retail Sales September Eurozone PROGNOSE: +0.5% yoy previous: +0.2% yoy
• 13:00 UK: BoE, outcome and minutes of the Monetary Policy Council meeting and Monetary Policy Report October Bank Rate FORECAST: 4.75% previously: 5.00%
• 14:30 US: Initial jobless claims (week) FORECAST: 220,000 PREVIOUS: 216,000
• 14:30 US: Productivity ex Agriculture (1st release) 3Q annualized PROGNOSE: +2.5% yoy 2Q: +2.5% yoy Unit labor costs PROGNOSE: +1.1% yoy 2Q: +0.4% yoy
• 20:00 US: Fed, outcome of FOMC meeting Fed funds target rate FORECAST: 4.50% to 4.75% Previous: 4.75% to 5.00%

All of these shares reached new ALL-TIME HIGHS at some point today ⤵️

Nvidia $NVDA (-1,56%)

Amazon $AMZN (-1,61%)

Netflix $NFLX (-1,3%)

Walmart $WMT (-0,74%)

JPMorgan $JPM (-0,81%)

Goldman Sachs $GOS0

Palantir $PLTR (-2,42%)

Blackrock $BLK

American Express $AXP (-0,48%)

Arista $ANET

Apollo $APO PR A

Blackstone $BX (-0,64%)

Booking $BKNG (-1,3%)

Instacart $INSTA

Caterpillar $CAT (-0,71%)

Capital One $COF (-0,58%)

Discover Financial $DFS (-1,03%)

Electronic Arts $EA (-0,76%)

GE Vernova $GEV (-2,18%)

Hilton $HLT (-0,98%)

Howmet $HWM (-1,62%)

Interactive Brokers $IBKR (-1,38%)

$KKR (-0,79%)

Cheniere $LNG (-0,04%)

Morgan Stanley $MS (-1,15%)

Marriot $MAR (-0,78%)

Nasdaq $NDAQ (-0,69%)

News Corp $NWSA (-1,12%)

Oracle $ORCL (-1,05%)

Palo Alto $PANW (-1,77%)

ServiceNow $NOW (-1,45%)

Steel Dynamics $STLD (-0,89%)

Stryker $SYK (-0,89%)

Royal Caribbean $RCL (-1,21%)

Reddit $RDDT (-0,77%)

Trade Desk $TTD (-2,44%)

Visa $V (-0,97%)

Wells Fargo $WFC (-0,89%)

$COF (-0,58%)

Capital One reports 1.6% profit increase in third quarter due to higher interest income

Capital One Financial Corp. reported a 1.6% increase in third quarter earnings. This increase was due to higher interest rates, which boosted the company's income from credit card debt repayments. The company's net interest income, which reflects the difference between interest earned on loans and interest earned on deposits, rose by almost 9% to around USD 8.1 billion in the third quarter.

The consumer lender thus outperformed in a sector that generally recorded a decline in interest income. This was thanks to higher interest rates on credit card debt compared to mortgages and other types of loans. Discover Financial Services $D1FS34 which is to be acquired by Capital One in a $35 billion transaction announced earlier this year, also reported a 10% increase in quarterly interest income.

Despite the positive revenue figures, the company is preparing for potential consumer charges. These could result from high interest rates, slower wage growth and reduced household savings. Capital One's provision for loan losses rose to $2.48 billion in the third quarter, an increase from $2.28 billion a year earlier.

Capital One's net charge-off rate, which indicates the percentage of loans considered uncollectible, rose to 3.27% from 2.56% in the same period last year. However, this increase in delinquencies is seen by executives and analysts as a return to pre-pandemic norms rather than an indicator of worsening economic conditions.

Capital One's adjusted net income for the quarter ended Sept. 30, 2023, was $1.73 billion, or $4.51 per share, compared to $1.71 billion, or $4.45 per share, a year earlier. Total net sales also increased 7% to $10 billion.

Source: investing.com

𝗠𝗮𝗿𝗸𝗲𝘁 𝗡𝗲𝘄𝘀 🗞️

𝗜𝗣𝗢𝘀 🔔

Volvo Cars has had to scale back its ambitions. The carmaker, owned by the Chinese group ($GRU (-2,77%)), will be listed on the Stockholm stock exchange on October 29 at a price of 53 Swedish kronor (5.3 euros) per share. On the occasion of this IPO, Volvo Cars should raise gross proceeds of about 20 billion Swedish kronor (2 billion euros), while it was previously expected to raise about 25 billion kronor

𝗘𝘅-𝗗𝗮𝘁𝗲𝘀 📅

Ex-dividend date: Antero Midstream ( $AM (+0,69%) ), Clorox ($CXX (-0,55%)), AptarGroup, Inc ( $AGT (-1,15%) ), Commercial Metals Company ( $CMS (+0,27%) ), Krispy Kreme, Inc ( $9YM (+0%) ), Entegris, Inc ( $ENQ (-1,38%) ), Infosys Technologies ( $IOY (+0%) ) und Prospect Capital ( $RK8 (-1,99%) )

𝗖𝗵𝗶𝗳𝗳𝗿𝗲𝘀 𝘁𝗿𝗶𝗺𝗲𝘀𝘁𝗿𝗶𝗲𝗹𝘀 📈

Today 3M ( $MMM (-0,59%) ), Aphabet ( $ABEA (-1,62%) ), Canon ( $CNNA (+0,32%) ), Capital One ( $CFX (-0,58%) ), General Electric ( $GCP (-0,46%) ), Hasbro ( $HAS (-0,83%) ), Hitachi Construction Machinery ( $HTCMY ), IDEX ( $ID7 (-1,31%) ), Lockheed Martin Corp ( $LOM (-0,47%) ), Logitech ( $LTEC (-0,69%) ), Microsoft ( $MSF (-0,98%) ), Novartis ( $NOTA (+0,21%) ), Texas Instruments ( $TII (-2,2%) ), Twitter ( $TWR ), UBS ( $UBRA (-0,39%) ), UPS ( $UPAB (-0,77%)) and Visa ( $3V64 (-0,97%) ) present their figures.

𝗠𝗮𝗿𝗸𝗲𝘁𝘀 🏛️

Tesla ( TL0) - After the car rental company "Hertz" ordered 100,000 Tesla electric cars by the end of 2022, Tesla's stock price reached a level of more than 1,000 US dollars. This transaction brought Tesla's stock value to more than US$1 trillion. By May 2021, the stock was still below 600 euros.

Automotive industry: The German automotive industry is now facing a shortage of magnesium. Magnesium is mainly needed for the alloying of aluminum. The supply shortage is due to energy saving measures in China, which have resulted in a reduction of magnesium production. China's market share, which represents 95% of European magnesium supply, is problematic. Some companies only have magnesium stocks until November, so experts are warning of a possible production shutdown.

𝗖𝗿𝘆𝗽𝘁𝗼 💎

MasterCard () - In collaboration with Bakkt, the payment service provider is integrating crypto-currencies into its system. This would allow more than 2 billion customers to access a wide range of cryptocurrencies and they could even earn additional rewards in bitcoin or similar.

In this context, Bakkt will take over the custody of crypto assets. Since the announcement of this project, Bakkt's share price has already increased by about 470%.

Crypto-currency fraud campaign - YouTube channels are currently being hijacked by hacking creators with fake cooperation requests, according to Threat Analysis Group. After the channels are taken over, they are either sold or used for livestreaming crypto-currency fraud. This campaign can be attributed to a group of Russian hackers.

𝗠𝗮𝗿𝗸𝗲𝘁 𝗡𝗲𝘄𝘀 🗞️

𝗗𝗲𝗿 𝗖𝗹𝘂𝗯 𝗱𝗲𝗿 𝗕𝗶𝗹𝗹𝗶𝗼𝗻𝗲𝗻 / 𝗜𝗺 𝗩𝗮𝗸𝘂𝘂𝗺 𝗱𝗲𝘀 𝗖𝗵𝗶𝗽𝗺𝗮𝗻𝗴𝗲𝗹𝘀 / 𝗦𝗰𝗮𝗺 𝗖𝗼𝗶𝗻𝘀 𝗼𝗻 𝗬𝗼𝘂𝗧𝘂𝗯𝗲

𝗘𝘅-𝗗𝗮𝘁𝗲𝘀 📅

As of today, Antero Midstream ($AM (+0,69%)), Clorox ($CXX (-0,55%)), AptarGroup Inc ($AGT (-1,15%)), Commercial Metals Company ($CMS (+0,27%)), Krispy Kreme Inc. ($9YM (+0%)), Entegris Inc ($ENQ (-1,38%)), Infosys Technologies ($IOY (+0%)) and Prospect Capital ($RK8 (-1,99%)) traded ex-dividend.

𝗤𝘂𝗮𝗿𝘁𝗮𝗹𝘀𝘇𝗮𝗵𝗹𝗲𝗻 📈

Today, 3M ($MMM (-0,59%)), Aphabet ($ABEA (-1,62%)), Canon ($CNNA (+0,32%)), Capital One ($CFX (-0,58%)), General Electric ($GCP (-0,46%)), Hasbro ($HAS (-0,83%)), Hitachi Construction Machinery ($HCM (+0%)), IDEX ($ID7 (-1,31%)), Juniper Networks Inc. ($JNP (+0,31%)), Lockheed Martin Corp. ($LOM (-0,47%)), Logitech ($LOGN), Microsoft ($MSF (-0,98%)), Novartis ($NOTA (+0,21%)), Texas Instruments ($TII (-2,2%)), Twitter ($TWR), UBS ($UBRA (-0,39%)), UPS ($UPAB (-0,77%)), Visa ($3V64 (-0,97%)) and WH Group ($WHGLY) presented their figures.

𝗠𝗮𝗿𝗸𝗲𝘁𝘀 🏛️

Tesla ($TL0 (-2,56%)) - After car rental company "Hertz" ordered 100,000 Tesla electric cars by the end of 2022, Tesla's stock price rose to a record level of over $1,000. This deal has increased Tesla's stock value to over one trillion US dollars. In May 2021, the the security was still below 600 US dollars. Tesla posted a profit of US$1.62 billion in the third quarter, a year-on-year increase of 389 percent. Tesla is thus in the club of companies with a market capitalization of over one trillion US dollars. Apple ($APC (-1,1%)), with a market capitalization of 2.5 trillion U.S. dollars, is alongside Microsoft ($MSF (-0,98%)), Alphabet ($ABEA (-1,62%)) and Amazon ($AMZ (-1,61%)) are the leaders in this club.

Pfeiffer Vacuum ($PFV (+0,46%)) - Due to high demand from chip manufacturers, vacuum pump specialist Pfeiffer Vacuum is able to benefit and is again raising its forecast. The company now anticipates sales of between €730 million and €750 million for the fiscal year. Previously, sales of between €710 and €730 million had been anticipated. The renewed increase in the sales forecast is due to the record order backlog. The margin for earnings before interest and taxes is expected to be between 12 and 13 percent. Pfeiffer has been particularly buoyed by high demand from the semiconductor industry over the past nine months. Due to the worldwide chip shortage, chip companies are currently expanding their capacities. To this end, the vacuum pumps manufactured by Pfeiffer are also in very strong demand.

𝗖𝗿𝘆𝗽𝘁𝗼 💎

MasterCard ($M41 (-0,74%)) - Together with Bakkt, the payment service provider is building cryptocurrencies into its system. As a result, more than 2 billion customers would have access to a wide variety of cryptos and can even earn rewards in Bitcoin or the like on top of that.

In this context, Bakkt will take over the custody of crypto assets. Since the announcement of this venture, Bakkt's share price has already risen by about 470%.

Crypto Fraud Campaign - According to Threat Analysis Group, Youtube channels are currently being hijacked by hacking the creators with fake cooperation requests. After the channels are taken over, they are either sold or used for crypto fraud by distributing it via livestream. This campaign is said to be attributed to a group of Russian hackers.

𝗔𝗹𝗹𝗲 𝗠𝗮𝗿𝗸𝗲𝘁 𝗡𝗲𝘄𝘀 𝗴𝗶𝗯𝘁 𝗲𝘀 𝗮𝗯 𝗷𝗲𝘁𝘇𝘁 𝗮𝘂𝗰𝗵 𝗮𝘂𝗳 𝗙𝗿𝗮𝗻𝘇ö𝘀𝗶𝘀𝗰𝗵

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