Market Snapshot

River1 Asset Management
October 22, 2025

Morning Note

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Trading Observations

Earnings take the baton, revisions continue upward https://tinyurl.com/3dw8bhwy [tinyurl.com] and https://tinyurl.com/rzpu77vu [tinyurl.com]
Market shrugging off NFLX + TXN weakness
Data centers under pressure last few days, but GEV + VRT both higher on numbers this morning on the power side
LRCX, TSLA, and URI after the close
US/India nearing a trade deal that would lower India tariffs to 15% from 50% https://tinyurl.com/ym6zf8h5 [tinyurl.com]
6765 resistance, 6700 first support
II Bulls DROP to 52.8% from 53.8%
Inflation expectations well anchored https://tinyurl.com/2p4e3auu [tinyurl.com]
Good sign that transports starting to push higher https://tinyurl.com/bdhvytex [tinyurl.com]
No surprise, AI use increasing https://tinyurl.com/yyktacx6 [tinyurl.com]

Futures

DOW +15

S&P +6

Nasdaq -32

Charts/Sentiment

CNN Fear/Greed Index

U.S. 10 Year Treasury

Gold

Bitcoin

Financials / Consumer / Healthcare

COF – Up 5% - Worries always pin this bank to bad credit, so it trades fairly cheap (8x EPS). Now that it’s merged with DFS, it’s a bit of a different business, and credit looked fine overall.

NTRS – Down 2% - Solid beat but it was credit driven. PPNR was just in-line. Trends mixed below the surface, especially given headwinds in the market. GS is rated sell and out negative.

SF – Up 1% - Solid capital markets beat. 7% top line beat, expenses in line. Comp ratio 58%.

HOLX – Downgraded to neutral at JPM on the take private announcement.

BYND – Roaring Kitty pushing a short squeeze to $7 this morning.

DNUT – Similar to BYND, Retail pushing Krispy Kreme up 30% this morning.

DKNG – Up 3% on prediction market Railbird merger.

WGO – Winnebago up 13% on earnings better than feared. Short interest likely playing a factor here too.

ISRG – up 18% on target procedure update boost.

ARCT – Today’s pharma loser as the stock is down 55% on safety concerns for its MRNA therapy.

Technology

Software vs Semis: +2% move ystrdy ... combo of soggy AI trade + MS positive SaaS note saying that their Q3 checks show stabilization across key metrics, supporting a potential re-emergence of positive earnings revisions after several cautious quarters

AAPL: -0.7% slashed orders for the iPhone Air and increased them for the iPhone 17 and iPhone 17 Pro (sticking with its prior production outlook in terms of overall units in aggregate) (Nikkei)

ADSK read / US Construction: Sept ABI slides to 43.3 (prior 47.2) with design contracts and project enquiries falling MoM and “erosion in project backlogs this past quarter”

AMZN Automation/Robotics: ystry NYT had an article saying that AMZN execs believe co can replace 500-600k by 2033 and goal is to automate 75% of warehouse operations and avoid hiring 160k workers by ‘27. The savings would amount to 30c per each item AMZN ships

DELL – Initiated OW at Pieper

DKNG: +7% DraftKings is taking a wholly owned approach to prediction markets compared to Flutter’s JV with CME ... bullish take: co's addressable market in terms of US population for a betting product doubled through the announcement, as the company is believed to launch into states without legal sports betting and leverage its database and brand to cross-sell sports-minded customers to the prediction market platform

GEV: +1% massive order numbers .... reported modest upside on EBITDA as robust rev was offset by weak EBITDA margins (8.1% vs. the Street 8.75%), and the prior guide is unch for 2025. Backlog and bookings were very strong – orders surged 55% organically to $14.6B (the B2B was well above 1x) and the backlog ramped $6.6B on a sequential basis.

GOOGL - ANTHROPIC IN TALKS FOR GOOGLE CLOUD DEAL WORTH TENS OF BILLIONS

GOOGL/META: Cleveland positive on both calling out strength in ROI META: Meta secures a $27B financing deal with Blue Owl Capital for its largest data center project, retaining 20% equity (Reuters)

MRVL: down 2% in pre; not sure if related to any Trainium chatter / checks out of Asia

PEGA: +15% solid metrics across the board. ACV up 14.5% y/y. RPO up 19% y/y. Beat Street on revenue by $30 million including $10 million in PEGA Cloud. $338 million in YTD FCF (up 38% y/y) and seeing incremental EPS growth with 8.7 million in repurchases YTD ... conf call this am

VRT: +6% Data center / power play beat and boosts. Midpoint guide ahead of consensus. Organic orders +60% YoY (vs +20% last qtr), book-to-bill ratio was ~1.4x and backlog increased to $9.5B ....

TXN – disappointing outlook. Overall semiconductor market recovery is continuing at a slower pace vs prior upturns. While the Industrial segment saw strong q/q and y/y growth, customers are showing some hesitancy amid macro uncertainty

Industrials

NUCLEAR headlines: (1)OKLO = U.S. offers nuclear energy firms access to weapons-grade plutonium, FT reports ... (2)the Dept of Energy will offeOMC: solid EPS/oper income upside (2.24/$651M vs St 2.16/$628M) w/the beat driven by solid margins (ad op income margins of 16.1% were about 65bp ahead of plan) while sales fell a tiny bit short (organic rev growth came in at +2.6% vs St +2.77%)

TSLA: Elon Musk's Pay Package Is ‘Insanity,' Says Ross Gerber

ABI out overnight - September US Architecture Billings Index (ABI) falls to 43.3 from 47.2 in August – New Project Inquiries Index 50.1 vs. month-ago 50.3 – “Unfortunately, business conditions remain relatively weak at architecture firms. There was some erosion in project backlogs this past quarter, with the greatest slippage coming from firms with an institutional specialization."

Badger Meter (BMI) upgraded to buy from hold at Stifel; $215 PT

Caterpillar (CAT) initiated sector perform at RBC; $560 PT

Commercial Metals (CMC) downgraded to hold from buy at Jefferies; $70 PT

Deere & Co. (DE) initiated outperform at RBC; $542 PT

H.B. Fuller (FUL) upgraded to buy from neutral at Citi

Generac (GNRC) initiated buy with $248 target at Needham – also added to Needham’s Conviction List

3M (MMM) upgraded to equal-weight from underweight at Morgan Stanley; $160 PT

NEXTracker (NXT) downgraded to neutral from buy at Guggenheim Securities

PACCAR (PCAR) upgraded to peer perform from underperform at Wolfe Research

Purecycle Technologies (PCT) initiated buy at Seaport Research Partners; $23 PT

United Rentals (URI) initiated outperform at RBC; $1,152 PT