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Dow Jones futures and S & P 500 futures fell modestly early Friday morning while Nasdaq futures retreated significantly, after the stock market rally extended for a third day. Apple (AAPL) Starbucks (SBUX) Fortinet (FTNT) Arista Networks (Anet) Shake shack (SHAK) and Universal Display (OLED) were big movers on earnings. Apple stock, Shake Shack, Fortinet and Universal Display all fell sharply, while Starbucks stock signaled a breakout.
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Three of these stocks have an IBD Composite Rating of at least 95. Apple stock and Fortinet stock boast a best-possible 99 Composite Rating. Starbucks stock has a 95 Composite Rating. Shake Shack had a 92 CR heading into earnings.
Dow Jones Futures Today
Dow Jones futures were 0.3% below fair value, erasing earlier losses. S & P 500 futures slid 0.35%. Nasdaq 100 futures sank 0.9%, as Apple stocks and big techs retreated late. Remember that overnight action in Dow futures and elsewhere does not necessarily translate into regular trading. That's been true during the stock market correction.
Meanwhile, in addition to Apple earnings and other late-Thursday reports, Friday will bring earnings from Ali Baba (BABA) and Dow components Exxon Mobil (XOM) and Chevron (CLC). Also Friday: the October jobs report.
Stock Market Correction Is Not Over
The stock market correction is not over, but a new rally attempt continued Thursday. The major averages rose again, while more top stocks broke out. However, there is a new way to confirm the new stock market rally. Until then, investors should be cautious about any new purchases.
Apple Earnings
Apple earnings rose 41% to $ 2.91 a share in its fiscal fourth quarter on sales of $ 62.9 billion, up 20%. That was the third quarter of accelerating earnings growth and the eighth quarter of faster sales.
Analysts expected Apple earnings per share of $ 2.78 a share, with revenue at $ 61.599 billion.
Apple sold 46.89 million iPhones, a little light. But the average price jumped 28% to $ 793, well above views.
Apple sees holiday-quarter revenue of $ 89 billion to $ 93 billion, under $ 93.02 billion.
Apple stock fell 6.5% in late trading.
Shares of the Dow Jones, S & P 500 and Nasdaq component closed up 1.5% to 222.22 on the stock market today. Apple stock settled just above its 50-day line. Shares have held up in the stock market correction. Tea relative strength line, which tracks a stock's performance vs. the S & P 500 index, has been at or near record highs.
Starbucks Earnings
Starbucks earnings rose 13% to 62 cents a share as revenue grew 11% to $ 6.3 billion. Same-store sales rose 3%, 4% in the Americas and a bullish 4% in the U.S.
Analysts expected Starbucks earnings of 59 cents per share on sales of $ 6.2 billion. Consensus Metrix expected 2.2% overall comps growth, including 2.8% in the Americas.
For 2019, Starbucks expects EPS of $ 2.61- $ 2.66 on 5% -7% revenue growth. The midpoints beat analyst views for $ 2.62 per share and 5% sales growth.
Starbucks stock jumped 9.2% to 64.01 late. That suggests Starbucks will clear at 59.90 buy point from a handle in a messy nine-month consolidation.
Fortinet Earnings
Fortinet earnings leapt 75% to 49 cents to share as revenue grew 21% to $ 453.90 million. Wall Street forecast Fortinet earnings of 42 cents on revenue of $ 450.9 million.
The cybersecurity firm's Q4 guidance is also above.
But Fortinet stock fell 6.2% late after closing up 1.8%. The Fortinet stock chart looks a lot like Apple's. The 50-day line, but it's holding up well after peaking in early October.
Arista Earnings
Arista earnings jumped 30% to $ 2.11 a share in Q3. Revenue rose 29% to $ 563.3 million. Analysts expected Arista earnings of $ 1.84 a share and sales of $ 548.3 million.
Arista Networks sees Q4 revenue of $ 588 million, just above estimates of $ 586 million.
Arista stock shot up 9.2% late, signaling a move above its 50-day and 200-day lines. Shares closed up 4.6% to 240.96, their third advance after hitting a 2018 low Monday.
Universal Display
Universal Display Earnings rose 71% to 8 cents a share, with revenue up 26% to $ 77.55 million. But analysts expected Universal Display earnings of 64 cents on revenue of $ 91.4 million.
The OLED technology and components maker sees full-year revenue of $ 240 million to $ 250 million, far below views for $ 304.6 million.
Universal Display stock plunged 27% in late trade. Shares rose 5.4% to 129.65 Thursday, nearing a 130.70 buy point. That followed a sharp sell-off from January's peak of 209.
Shake Shack Earnings
Shake Shack earnings were flat at 17 cents a share, with sales rising 26.5% to $ 119.6 million, both topping views. But same-store sales fell 0.7%, defying forecasts for a 0.9% rise.
Shake Shack nudged up full-year sales and comps targets, but slightly below.
Shake Shack stock fell 3.3% late. Shares rose 3.6% Thursday to 54.78.
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