Morning Market Feed, May 23rd
It was a very important day for the markets as we saw the FED minutes, a publication in which we get a look into the minds of the FED officials and see how they talk about the issues at hand. For the last period in time, that would be inflation of course. Besides the FED minutes, we also saw Nvidia report earnings after the market close and that was a big, and extremely important one. Besides the Nvidia earnings, Target, and ELF Beauty also reported earnings, so instead of making this an extremely long letter, I will link the articles in which I dive into the numbers and just give the highlights here. Let’s dive straight into it!
- Let’s begin with Nvidia
We can’t talk about the earnings without first talking about what was expected from Nvidia going into the earnings release. By saying that, analysts expected revenues to come in at $24.59 billion, creating EPS of $5.58. Analysts expected guidance to come in at $26.84 billion.
Nvidia reported $26.04 billion of revenues, which resulted in $6.12 in EPS. Doing some calculations means that they did bring slightly less to the bottom line than expected on a percentage basis, but absolute numbers beat expectations by a very large margin. The Q2 guidance came in at a revenue of $28 billion, plus or minus 2%. Again, well above the consensus estimate. For my full thoughts on the earnings report, you can click the button below.
- So what about Target?
Target reported EPS of $2.03, missing the expectations but also coming in slightly lower than EPS from the year-ago quarter. This came from revenues of $24.53 billion, a slight beat of expectations, as well as a slight increase from last year, however, this mostly came from, new store openings as comparable sales were down 3.7% Year-Over-Year. The average ticket per customer was also slightly down. My full thoughts about the release can be seen by clicking the button below.
- ELF Beauty with the revival
ELF initially dropped 10% on the earnings release, but recovered to being positive 2% as adjusted EPS came in at $0.53, growth of 26% year-over-year, while revenues came in at $321,14 million, growth of 71% year-over-year. GAAP EPS was down when compared to the year-ago quarter as ELF took an impairment expense on equity investments of $1.155 thousand and an interest expense of $4.002 thousand. Diluted GAAP EPS was $0.25 compared to $0.29 last year.
As these were the Q4 numbers, we need to take a look at the full-year numbers as well. These came in at 1.023 Billion, an increase of 71% from the prior year. EPS for FY23 came in at $3.18, compared to $1.66 in ‘22, an increase of 91.5%. Again, a more detailed look can be seen by clicking the button below.
- How about the FED minutes?
Well, let me allow you to take a guess at the message that we got from it… Higher for longer, really surprising. It did turn out that the FED was a bit more nervous about recent CPI readings than initially expected, but all this was quickly laid aside after a small drop in the indices because of the Nvidia earnings release which was seen as more important as the news wasn’t really shocking.
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