Trading Observations

• CPI came in hot at .5% vs .03%, sending yields up and futures lower. Darn eggs

• Tariff headlines could be more dangerous with CPI hot before any tariffs start to actually filter into data

• 6100 Resistance vs. 5960 support, churning above 6000 seems a good place

• Crowded Energy play VRT down 6% after a beat but very high expectations.

• Zillow is lower with an interesting tidbit from their call: Nearly 23% of sellers cut their home's list price, the highest share of any January in Zillow records; Buyers have more negotiating power than in any January over the past five years; Homes are selling faster than they did before the pandemic.

• Used car prices went up in Jan https://tinyurl.com/seazc7w6 [tinyurl.com]

• Overseas investors still investing in US https://tinyurl.com/34cjy4y4 [tinyurl.com]

• EU mkts better than US https://tinyurl.com/77yevsa8 [tinyurl.com]

Futures

DOW -435

S&P -61

Nasdaq -236

10-Year Yield

Oil

BITCOIN

Financials / Retail / Healthcare

UPST – Up 20% - Is there a credit crisis? None. Do customers want or need to borrow at very high rates? Yes, they do.

RDFN, ZG – RDFN is u p 5%, Zillow down 6% on a Zillow guide down and opposite for Redfin.

KHC- Kraft Heinz down 6.5% on weak sales guidance. Consumers being blamed for fewer “away from home meals” as a problem. We think GLP1s played a factor.

Bank Regulations – Consolidation may happen per WSJ as the CFPB has already been gutted, and the Fed, OCC, FDIC, and Treasury could be merged up.

AIG – Small beat. JPMM remains positive. Everyone cutting on LA fire losses.

Technology

ADBE: showing a pulse / 1st close above 50D in long time .... ppl trying to warm up to the name here given strength in reasonably priced software names (ADBE trading at 20x) and SMB exposure. M-sci and Clev both positive trending checks this week. Bulls want to see CC NNARR stabilize in dd range and hear about some traction from FireFly / AI initiatives while bears continue to question ADBE’s position in an AI world and point to competition across various businesses

ANET: Arista Networks Insider Sold Shares Worth $18,497,049, According to a Recent SEC Filing. Stock -4%.

AMD: Lisa was in NYC last night meeting investors

APP: #s tonight / 18% implied move .... Call 5pm ET ... crowded long; expectations sky high given checks have all been great ... Focus on Ecommerce ramp + new model anncd in Q4 ... Bogeys: Q4 total revs $1.32B; Q4 software revs $925M (60% growth vs St at $892M); EBITDA $800 vs guide $750M .... Q1 total revs $1,360M vs est $1,318M

BL: -13% 4Q billings light at ~$207mn vs cons $218mn and guides 1Q revs below street at $166-168mn vs cons $171mn .. guides FY25 Revs$699-705mn vs cons $711mn

DASH: +6.6% Solid Q and great GOV guide; Q1 EBITDA slightly weaker; Guides Marketplace gross order value $22.6B to $23B, EST $22.43B. Guides ADJ EBITDA $550M to $600M, EST $585.4M

DIOD: guides 1Q revs below street to $323mn (-5% q/q) vs cons $335mn “due to the Chinese New Year holiday but slightly better than typical seasonality. “ ..

LYFT: -12% Weaker GBs and GB guide weighing .. sentiment low / not a ton expected here but gross bookings slightly weaker than feared. Active riders/rides roughly inline. FCF decent .. cautious on pricing environment

SMCI: +6.6% Dec results terribel; lowered FY25 rev guide; due to Blackwell delays and impacts from SMCI’s own 10-K filing delay (which they still have not filed yet – but are adamant will do so before the Feb 25 deadline). Company also announced a new $700mn private placement of 2.25% convertible senior notes to help improve liquidity .... BULLISH FY26 REV VIEW. SMCI FY26 REV GUIDE: Expect FY26E rev to reach $40bn (60%+ y-y) – and this number is conservative .... GB200 NVL72 racks are fully ready for volume production – already have some small allocation from NVDA,

UPST (big short interest): +23% Another blow out with 20% rev beat and guide 10% above street. FY guide well above as well at $1B vs street at $815M. Another nice call by Yipit here

Z: Q4 numbers ahead; Q1 guide appears light on flattish demand. 2025 forecast is better than Q1 – they see sales up 13-15% (vs. the Street +14%) w/continued EBITDA margin expansion

Industrials 

Compass Minerals (CMP) upgraded to overweight from neutral at JPMorgan

Fluence Energy (FLNC) downgraded to neutral from buy at Roth MKM

Fluence Energy (FLNC) downgraded to neutral from buy at UBS

GNRC beat by 27c; revs missed by $20M

Lucid (LCID) Rated New Buy at Benchmark; PT $5

PPG Industries (PPG) Cut to Neutral at JPMorgan; PT $115

R – Q4 EPS beats (Revs light), FY guidance looks fine (transports have guided conservatively thus far).

TEL – TE Connectivity to acquire Richards Manufacturing in all cash transaction valued at ~$2.3B.

Tesla (TSLA) Rated New Buy at Benchmark; PT $475

VRT - not covered but a closely watched AI/data center play - trading down (6.3%). Results were solid but top end of Q1 guide = expectations. So strong execution but up against high expectations.