US OPEN: Nvidia profit jumps on strong data-center demand

• US futures point to small gain at cash session open

• Nvidia (NVDA.US) Q4 EPS jumps over 100% YoY

• Expedia (EXPE.US) sees double-digit revenue growth in 2020 despite virus outbreak

US stock market futures point to a higher opening on Wall Street today. Nasdaq is leading in pre-market trade while Dow Jones lags the most. A point to note is that US indices finished lower on 5 out of 6 Fridays this year. However, the single Friday when Wall Street closed higher was ahead of a long weekend including Martin Luther King Day. To draw an analogy it should be said that US stocks will remain shut on Monday for the Presidents’ Day holiday.

Russell 2000 (US2000) has managed to catch up a bit on the other Wall Street indices recently. Small-cap index reached the key resistance zone at $1700 pts yesterday. However, a minor pullback can be spotted today and it cannot be ruled out the the index will once again fail to break above the zone. In such a scenario, the first target for bulls could be recent swing level at 1655 pts. Source: xStation5

Nvidia (NVDA.US) reported fiscal Q4 (ended on 26 January 2020). The company generated revenue of $3.11 billion in Q4 2019, marking a 41% YoY increase and 5% beat. Adjusted EPS grew from $0.80 in Q4 2018 to $1.89 in Q4 2019 (exp. $1.66). Major beats were possible due to strong demand for data-center and gaming chips. Sales in the data-center segment jumped 43% YoY to $968 million while revenue from gaming division jumped 56% YoY to $1.49 billion. The company expects fiscal Q1 2020 revenue to fall into $2.94-3.06 billion range. Revenue forecast was lowered by $100 million due to expected negative impact from coronavirus outbreak.

Pinterest (PINS.US) declines in pre-session trading on reports that Facebook may release its own app for sharing photos.

Secondary stock offering of Tesla (TSLA.US) was priced at $767 per share. The price represents a 4.6% discount against yesterday’s close. Total offering is worth $2.03 billion.

Nvidia (NVDA.US) has almost fully recovered from an over 50% plunge that took place in the final quarter of 2018. The stock broke above the upper limit of the upward channel earlier this week and has retested it as a support yesterday. Upward move is set to continue today as pre-market trades point to an open near the local peak from early-September 2018 ($283.50). In such a scenario, buyers’ focus will shift to ATH at $293. Source: xStation5

Expedia (EXPE.US) reported Q4 results yesterday after the session closed. The US travel company generated revenue of $2.75 billion amid expectations of $2.77 billion. Adjusted EPS for Q4 2019 reached $1.24, in-line with year ago value and 8.7% higher than median estimate. Adjusted EBITDA of $478 million was 1.5% YoY higher. Gross bookings grew 5.9% YoY to $23.25 billion. The company expects adjusted EBITDA to grow at a double-digit pace this year, even in spite of the coronavirus outbreak affecting travel intentions.

eBay (EBAY.US) released updated forecasts that account for a completed sale of StubHub. The US e-commerce company expected 2020 adjusted EPS in the $3.00-3.10 range (previously $2.95-3.05). Q1 revenue is forecast in the $2.31-2.36 billion range. eBay also decided to boost 2020 share buyback plan from $1.5 billion to $4.5 billion. Net proceeds from the sale of StubHub should amount to $3.1 billion.

Expedia (EXPE.US) slumped almost 30% following the release of Q3 earnings. The stock is still trading significantly below end-Q3 2019 levels but is expected to jump towards the 200-session moving average (purple line, $122 area) at the opening of today’s session. In such a scenario, the two closest levels to watch will be support at $118.40 and resistance at $128.00. Source: xStation5