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Mixed Bag: Econ Data & Q4 Earnings: PEP, DE, AXL

Mark Vickery
Import/Export Prices, Empire State survey and Industrial Production/Capacity Utilization join fresh Q4 results ahead of the bell.

Friday, February 15, 2019

Import and Export Prices for the month of January have been released ahead of this morning’s opening bell, with results — much as we’ve seen with recent economic metrics — coming up short of estimates. Import Prices month over month hit -0.5%, lower than the -0.3% expected. Subtracting petroleum prices, this figure falls further, to -0.7%. Year over year was -1.7%, in-line with projections. Export Prices, meanwhile, came in -0.6% month over month compared with estimates of -0.2%. This headline number matches December’s -0.6%; year over year was -0.2%.

The Empire State survey for February also hit the tape this morning, and this number was better than expected: +8.8, compared to the 7.0 analysts had been looking for. Last month’s 3.9 was unrevised. These figures track development in New York State, and as such are often more volatile than national production tallies.

Industrial Production and Capacity Utilization for January have also come out this morning, and results are again lagging where analysts had expected them to be: -0.6% on the Industrial Production headline misses the breakeven estimate, with December revised down as well, from +0.3% originally reported to +0.1% this morning. Capacity Utilization dipped from 78.7% expected and the slightly upwardly revised 78.8% the previous month to 78.2%. That December figure, however, was the hottest Cap-Ute number we’d seen in 4 full years.

Q4 Earnings Roundup

PepsiCo PEP
met earnings estimates for its Q4 bottom line at $1.49 per share. The reason this is notable is because Pepsi has a 5-year track record of (slightly) beating earnings estimates; simply meeting expectations may be considered closer to a loss than for companies that struggle to surpass projections. Shares are trading up 2% in today’s pre-market, however, on positive sentiment in the company’s 2019 outlook and an up-day to start overall. Revenues in Pepsi’s quarter were also in-line at $19.52 billion. For more on PEP’s earnings, click here.

Deere & Co. DE, on the other hand, has now missed earnings estimates for 4 straight quarters, putting up $1.54 per share versus $1.80 expected. Revenues, however, were slightly better than anticipated at $6.9 billion in the quarter, up 16% year over year. Shares are falling 3.4% thus far in pre-market activity, though remain in the green year-to-date. For more on DE’s earnings, click here.

American Axle AXL, a Zacks Rank #2 (Buy)-rated company with a Style Score (Value - Growth - Momentum) of A ahead of its Q4 earnings report, outperformed expectations on both top and bottom lines this morning. This follows a slightly disappointing Q3 report, which marked the company’s only missed quarter in the past 5 years. Shares are currently up 4.75% before today’s opening bell, effectively coming back from its slight dip early in the month. For more on AXL’s earnings, click here.

Mark Vickery
Senior Editor

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