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Trump's Election Day vaccine "miracle"
Welcome, dear readers, to my semi-regular coronavirus roundup. Housekeeping:
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EDIT: TRUMP ADMITTED TO KNOWING DANGER OF COVID WEEKS BEFORE ACTING
Bob Woodward's new book reveals that Trump was aware that the coronavirus was dangerous and "more deadly than even your strenuous flus" even as he publicly downplayed the threat and failed to act to save lives. (article now updated with audio of Trump's interview)
"This is deadly stuff," Trump told Woodward on February 7. In a series of interviews with Woodward, Trump revealed that he had a surprising level of detail about the threat of the virus earlier than previously known. "Pretty amazing," Trump told Woodward, adding that the coronavirus was maybe five times "more deadly" than the flu.
Trump also admitted to intentionally downplaying the threat:
"I wanted to always play it down," Trump told Woodward on March 19, even as he had declared a national emergency over the virus days earlier. "I still like playing it down, because I don't want to create a panic."
Election day vaccine
A group of nine leading pharmaceutical and biotechnology companies pledged on Tuesday to only seek approval for Covid-19 vaccines demonstrated to be safe and effective. The pledge comes as Trump hypes the possibility of a vaccine before Election Day. His timeline has been pushed forward from “by the end of the year” to “before November 1st” and, most recently, “during the month of October.” During his Labor Day press-briefing-turned-campaign-event, Trump said: "[It's] going to be done in a very short period of time -- could even have it during the month of October” (clip). Trump went on to explicitly ties the vaccine to his re-election schedule: “We'll have the vaccine soon, maybe before a special date. You know what date I'm talking about” (clip). Despite saying the quiet part out loud himself, the president tried to cast Joe Biden and Kamala Harris as the ones politicizing the vaccine process: “They’re going to make the vaccine into a negative… They’re saying ‘wow, Trump’s pulled this off, let’s disparage the vaccine.’ That’s so bad for this country, that’s so bad for the world to even say that and that’s what they’re saying” (clip). Unfortunately, many media outlets have portrayed the issue as a “both sides” argument. Federal officials and health experts say Trump’s Election-oriented timeline is unlikely. NPR spoke with Moncef Slaoui, chief adviser for the administration's vaccine development program, who said he expects to have "enough vaccine to immunize the U.S. population by the middle of 2021.” Case in point, development on the vaccine Trump was rumored to be betting on, the AstraZeneca-Oxford project, was put on hold due to a suspected serious adverse reaction in a participant. But the point may not be to have a vaccine fully available to the public; Trump can simply claim the “deep state” is holding things up, blaming Biden/Harris for the pandemic under his watch. Furthermore, experts say there is no way our government and existing infrastructure will be ready to distribute, administer, and track doses by November. Health departments will also need an infusion of federal aid, a proposal that seems out of reach with a Republican-controlled Senate afraid to spend any more money during the pandemic.
...many health departments are so overwhelmed with the current costs of the pandemic — such as for testing and contact tracing — that they can’t reserve money for the vaccine work to come. Health departments will need to hire people to administer the vaccines and systems to track them, and pay for supplies such as protective medical masks, gowns and gloves, as well as warehouses and refrigerator space.
America alone
Meanwhile, the U.S. is backing down from the global fight against the pandemic, further enshrining Trump’s “America First” perspective into official policy. The Trump administration declined to join a global effort to develop, manufacture, and equitably distribute a coronavirus vaccine, in part because the World Health Organization is involved. U.S. allies including Japan, Germany, and the European Commission back the effort.
“The United States will continue to engage our international partners to ensure we defeat this virus, but we will not be constrained by multilateral organizations influenced by the corrupt World Health Organization and China,” said Judd Deere, a spokesman for the White House.
Further reading: The Trump administration said it won't pay more than $60 million in dues it owes to the World Health Organization.
The U.S. Agency for International Development, in charge of distributing global assistance related to the pandemic, is shutting down its only pandemic-focused task force. Other agency bureaus and divisions will take on its functions.
Sturgis comes home
South Dakota (+120%), Iowa (+81%), and North Dakota (+66%) have seen the largest 2-week increase in COVID-19 cases in the last two weeks, compared to the two weeks before. These three states were also the “epicenter” of the Sturgis motorcycle rally last month. The event packed nearly 500,000 people into a small town in South Dakota, with rallygoers attending from - and returning to - all around the country. Photos and reports from Sturgis documented a startling lack of face masks and social distancing precautions. According to a new study, over 250,000 coronavirus cases can be contributed to the rally. Assuming a cost of $46,000/case, the authors estimated the rally cost $12.2 billion. “This is enough to have paid each of the estimated 462,182 rally attendees $26,553.64 not to attend,” they write. SD, IA, and ND do not have statewide face mask mandates. In fact, the Dakotas are two of just five states that do not allow local officials to require masks (the others are ID, MO, and OK). Iowa Gov. Kim Reynolds has been told by the White House that the state’s outbreak is the steepest in the nation and urged officials to require mask-wearing statewide. Reynolds has yet to do so.
Alabama schools
Alabama has the fourth-most daily new cases per 100k people (after ND, SD, and IA) despite a statewide face mask order. The state has largely lifted all social distancing measures and has encouraged schools to reopen with in-person classes and sports. According to a NYT database, four-year universities in Alabama have over 4,000 coronavirus cases just weeks after opening. The University of Alabama in Tuscaloosa accounts for over 1,300 of the cases. Professors at the school were reportedly told by the administration not to talk about the outbreak - not even to inform students if someone in their class tests positive. The mayor of Tuscaloosa let bars near the university reopen on Tuesday.
Further reading: Alabama is starting to see a payoff from its mask mandate, in place since mid-July. New covid cases have been cut in half over the past month and coronavirus patients admitted to hospitals fell to the lowest level since June.
Remember the news articles praising Trump’s new “tone” on masks? During Monday’s press conference, Trump tried to bully a reporter into taking off his face mask when asking a question (clip). The reporter, Jeff Mason of Reuters, refused. Apparently, this annoyed Trump so much that he was still griping about it on Twitter Tuesday (clip).
Trump pushes for sports
After weeks of haranguing schools to bring back sports, Trump has reportedly offered Big Ten football teams access to the national government’s reserve of rapid COVID-19 tests.
The new, cheaper […] tests could be the key that unlocks the door back to the Horseshoe and stadiums around the conference. And the White House might be willing to assist in that effort by potentially designating part of its supply to the Big Ten after buying 150 million rapid tests last week from Abbott Laboratories.
The president is so attached to the idea of college football resuming that he is pushing the Big Ten conference to go ahead without the participation of three schools, blaming the governors of Michigan, Illinois, and Maryland for the conference’s vote to cancel.
Mitch plays games
The Republican-controlled Senate is planning on voting on a scaled-down coronavirus relief package as early as this week. The “skinny” bill is unlikely to become law as Democrats feel it does not adequately address the magnitude of the crisis the nation is facing. McConnell is hoping a Senate vote on coronavirus aid - any aid - will help vulnerable Republicans up for re-election.
The Republican bill is expected to include a federal unemployment benefit, another round of Paycheck Protection Program (PPP) funding, and more money for coronavirus testing and schools, as well as liability protections from lawsuits related to the virus. McConnell didn't release a price tag for the forthcoming bill, but it is expected to be at least $500 billion — half of the $1 trillion package Republicans previously unveiled in late July.
One of the reasons - perhaps the main reason - for the breakdown of relief bill negotiations may be new White House Chief of Staff Mark Meadows. Rep. Gerry Connolly (D-Va.), who served with Meadows on the Oversight Committee, told The Hill:
“Closing deals is not Mark Meadows’s strong suit. His whole track record is: blow it up… If you ask yourself what’s the difference between April and May, when we did reach big, broad bipartisan consensus, and today, the variable is Mark Meadows.”
Miscellaneous news
Lost in the Sauce was so long this week that I had to omit a couple of sections. I’ll include them here instead. Immigration: Federal Judge Dolly Gee ordered DHS to cease using hotels as detention facilities for migrant children it seeks to expel from the border.
Gee said the use of hotels for detention purposes violates the Flores agreement because the locations lack sufficient oversight, state licenses to hold minors and standards for the care of young children. Minors have also faced a "woefully inadequate" process to seek the help of lawyers, who have been barred from entering the hotels, Gee added, citing declarations from attorneys who said they struggled to reach detained children.
Further reading: “Watchdog confirms botched family reunifications kept migrant children waiting in vans overnight,” NBC; “Trump nominee had role in removing prosecutor opposed to family separations,” Guardian
Immigration: The Trump administration has drafted a proposal that would dramatically expand the number of people required to provide biometrics for their immigration applications, while also increasing the personal information the government can demand, such as eye scans, voice prints, DNA, and photographs for facial recognition. Immigration: The Border Patrol made a dramatized YouTube video depicting a Spanish-speaking attacker stabbing and killing a man in a dark alley after escaping from U.S. agents - “a clip apparently created to dramatize President Trump’s depiction of migrants as fearsome criminals.” The agency removed the video following backlash. Environment: The National Oceanic and Atmospheric Administration opened an inquiry earlier this year into whether Trump political appointees illegally weakened rules meant to protect whales from oil industry seismic airgun blasting. Then, just as quietly, it halted the probe. Environment: The Trump administration proposed a rule change that would make it easier to permit oil and gas drilling operations in national forests. The move comes as a watchdog report reveals the oil and gas industry has been allowed to pay far less than usual to the government for the right to drill on public lands under a controversial Trump administration coronavirus relief policy. Furthermore, the administration is seeking to fast track environmental reviews of dozens of major energy and infrastructure projects during the COVID-19 pandemic, including oil and gas drilling, hazardous fuel pipelines, wind farms, and highway projects in multiple states. Environment: The U.S. Fish and Wildlife Service issued a proposal that would allow the government to deny habitat protections for endangered animals and plants in areas that would see greater economic benefits from being developed — a change critics said could open lands to more energy development and other activities. World: Secretary of State Mike Pompeo announced sanctions against two International Criminal Court officials -- the Trump administration's most aggressive move yet to try to deter an ICC investigation into possible war crimes by US military and intelligence officials. World: How Donald Trump took down the Robert Mueller of Latin America: At the center of the story is an alleged quid pro quo between Donald Trump and Jimmy Morales, a former television comedian who was elected president of Guatemala.
Wall Street Week Ahead for the trading week beginning October 5th, 2020
Good Friday evening to all of you here on StockMarket. I hope everyone on this sub made out pretty nicely in the market this past week, and is ready for the new trading week ahead. Here is everything you need to know to get you ready for the trading week beginning October 5th, 2020.
Trump’s health and fiscal stimulus fight will steer the markets in the week ahead - (Source)
President Donald Trump’s health and the state of a fiscal stimulus package will be the main focus for markets in the coming week. In the early morning hours Friday, President Donald Trump tweeted that he and the first lady tested positive for Covid. Stocks sold off hard, but the S&P 500 came off its lows in Friday trading and closed down just under 1%. It was up 1.5% for the week. The market was helped by signs that a stimulus package is still a possibility, after House Speaker Nancy Pelosi asked airlines not to furlough workers. She promised either a stand alone aid bill, or a bigger negotiated relief legislation that would help the industry. “The market is going to watch health updates from the White House medical staff, and it’s going to watch how the president communicates with the public,” said Julian Emanuel, head of equities and derivatives at BTIG. “Will we see him in person in the next week in any form? What’s his volume of tweets? All as a way to first gauge the severity of the case.” Trump and Melania Trump are reported to have mild cases, but as time goes on the market will turn to how the illness could impact the presidential election. Former Vice President Joe Biden gained slightly in the polls after the first debate Tuesday night, and now the calendar for further debates is in question. The market has seemingly warmed to Biden, and even though he would raise taxes, it is assumed Democrats would quickly pass a major infrastructure package if there is a Democratic sweep of Congress. Trump, however, is widely seen on Wall Street as stronger on the economy and better for markets. “What you’ve done from a campaign perspective, is you’ve taken away the thing that gives him the most energy - his ability to interact with crowds,” said Emanuel. “The president had wanted to paint the economic recovery of the last three or four months as the cornerstone, and this basically puts the virus back as topic number 1, number 2 and number 3. And it’s all the more so because the data is coming in weaker than expected.” The market is fixated on the prospect of stimulus to help business, the unemployed and state and local governments. The House passed a $2.2 trillion package this week, but there is still no agreement with Republicans. Treasury Secretary Steven Mnuchin has pushed for a $1.6 trillion package. “I think there’s an underlying bid under the market because nobody wants to be super short if we get a stimulus approved, but you can’t be too long in case his mild symptoms turn into severe symptoms,” said Scott Redler, partner with T3live.com. “We’re in a tough spot but overall we’re still pretty constructive.” Emanuel said the fact the president is now ill could hurt confidence and slow down some of the improvement in the economy. “The underlying tone is, again, whether its directly or later, there’s going to be stimulus,” Emanuel said. ”’Whether it’s this month or November, this reinforces the need for stimulus because the president falling ill signals to, at the margin, the person whose thinking about going out to dinner to think again. It’s a significant economic and psychological hindrance.” Also coming up in the week ahead is a speech Tuesday by Fed Chairman Jerome Powell to the National Association of Business Economists. Powell is also expected to push for the stimulus package to boost the economy so the recovery does not stall. “I think his whole objective is to try to get Congress and the Administration to sign onto a fiscal rescue package,” said Mark Zandi, chief economist at Moody’s Analytics. “He’ll all but come out and say [the recovery] is not a ‘V.’ Without additional support from lawmakers, risks are pretty high that we backtrack. I think that’s the kind of outlook he’s going to give. It’s going to be full-throated.” September’s employment report, released Friday, was seen by some as a warning that the economy is not rebounding as expected. There were 661,000 jobs added in September, well below the 800,000 expected. Besides Powell, there are a half dozen other Fed speakers. There are also minutes from the Fed’s last minute released Wednesday afternoon.
This past week saw the following moves in the S&P:
We've all had versions of this conversation where you or the person you were talking to just couldn't make up their mind. At the end of the day, it only causes trouble and plans are ruined. The market is having its own back and forth this year trying to decide between growth and value. Just today, growth stocks are getting slaughtered while value stocks are up marginally. As an example, the Russell 1000 Growth index is down 1.8% on the day while the Russell 1000 Value index has managed to rally 0.25%. The chart below shows the daily performance spread between the Russell 1000 Growth index and the Russell 1000 Value index for each day in 2020. Today's performance spread between the two indices marks the ninth time this year that value has outperformed growth by more than two percentage points. At the other extreme, there have also been eight trading days where growth outperformed value by more than two percentage points.
So how does this year's frequency of days where the performance spread between the two indices was more than two percentage points stack up to other years? The chart below shows the daily performance spread between the two indices going all the way back to 1990. Over the last thirty years, the only two periods where we saw a frequency of these large daily dislocations was back in 2008 and the period spanning 2000 and 2001. In fact, with 17 days this year where the performance spread between the two indices was greater than two percentage points, the only other years that saw a higher frequency of large dislocations were 2000 (54) and 2001 (28). If you think the market has been indecisive this year, in 2000 we saw these types of daily dislocations an average of once per week.
Election Anxiety Weighs on October Market Performance
October often evokes fear on Wall Street as memories are stirred of crashes in 1929, 1987, the 554-point drop on October 27, 1997, back-to-back massacres in 1978 and 1979, Friday the 13th in 1989 and the 733-point drop on October 15, 2008. During the week ending October 10, 2008, Dow lost 1,874.19 points (18.2%), the worst weekly decline in our database going back to 1901, in percentage terms. March 2020 now holds the dubious honor of producing the worst, second and third worst DJIA weekly point declines. The term “Octoberphobia” has been used to describe the phenomenon of major market drops occurring during the month. Market calamities can become a self-fulfilling prophecy, so stay on the lookout and don’t get whipsawed if it happens. But October has become a turnaround month—a “bear killer” if you will. Twelve post-WWII bear markets have ended in October: 1946, 1957, 1960, 1962, 1966, 1974, 1987, 1990, 1998, 2001, 2002 and 2011 (S&P 500 declined 19.4%). However, eight were midterm bottoms. Over the last 21 years, October’s performance has been solid. Average gains over the last 21-years range from 1.3% by Russell 1000 to 2.4% by NASDAQ. Small caps have still struggled though with Russell 2000 gaining a modest 0.5%
Election-year Octobers rank dead last for Dow, S&P 500 (since 1952), NASDAQ (since 1972), Russell 1000, and Russell 2000 (since 1980). Eliminating gruesome 2008 from the calculation provides a moderate amount of relief, as rankings climb to mid pack. Should a meaningful decline materialize in October it is likely to be an excellent buying opportunity, especially for any depressed technology and small-cap shares.
What Have Democratic Sweeps Meant for the S&P 500?
Headed into the first presidential debate Tuesday night, betting markets (ElectionBettingOdds.com) placed Democratic candidate Joe Biden as the slight favorite to take the White House in November. The debate resulted in Biden gaining another 5 percentage point chance of winning the Presidency. As of this morning, Biden's odds to win are at 59.8% versus Trump's odds of 38.9%. Additionally, Democrats are slight favorites to win control of the Senate (58.4% to 41.5%) and big favorites to maintain the House (82.8% to 17.1%). Given these odds, in the chart below we show the average performance of the S&P 500 from the three months before Election Day through three months after Election Day for all election years post-WWII that resulted in a sweep of the executive and legislative branch by the Democrats. As shown, on average the S&P 500 has been on the decline in the weeks leading up to Election Day, though in the days just before the Election there has been a small rally that sharply reverses once the results come in. After the initial post-Election drop, the market has trended a bit higher, but by three months after the Election, it has only found itself around the same levels as Election Day; on average a 2.6% loss versus where the index stood three months prior.
The composite shown above is comprised of six different years: 1948, 1960, 1964, 1976, 1992, and 2008. While on average the S&P 500 has traded lower, it is not necessarily a sure-fire thing. For example, 1948 and 2008 were the only years that saw the S&P 500 trade and stay significantly lower in the wake of the election. In 1976, there was similarly a sell-off in the immediate aftermath of the election, but the index did make its way back up to the highs of that six-month time frame later on albeit no new high was put in place. Meanwhile, 1960, 1964, and 1992 all saw the S&P 500 run higher after the election even despite some periods of consolidation after initial moves higher. In our B.I.G. Tips report from Tuesday, we show these same charts for all Presidential election years post WWII including a look at the average performance given every potential election outcome.
Even after September's weakness, the S&P 500's trailing 12-month total return stood at an impressive 14.9%. Given the events of the last 12 months, one could even say that performance is remarkable. What's even crazier is that the S&P 500's performance over the last 12 months is more than three times stronger than the 12 month period before that (+4.25%). The chart below compares the S&P 500's annualized total returns over the last one, two, five, ten, and twenty years and compares that performance to the historical average return of the index over those same time periods. The S&P 500's historical average 12-month return is 11.7%, so the current 14.9% gain exceeds that average by more than three full percentage points. Over a two-year window, though, the S&P 500's annualized return of 9.4% is more than a full percentage point below the historical average. Looking further out, the S&P 500's trailing five and ten-year annualized return has been much stronger than average, which makes sense given the long bull market we were in. Over a 20 year window, though, the S&P 500 is only just starting to work off some of the declines from the dot-com bust and as a result, the 6.4% annualized gain is a four and a half percentage points below the long-term average of 10.9%.
Below we show how the current performance of the S&P 500 in each of the time frames shown compares to all other periods on a percentile basis. The S&P 500's performance over the last year, ranks just below 56th percentile of all other periods, while the two-year performance ranks just below the 42nd percentile. Even as the five and ten-year periods have seen well above average returns, they still rank in just the mid-60s on a percentile basis. The S&P 500's ranking over a 20-year time period is a completely different story ranking in single-digits on a percentile basis. Even with the equity market right near record highs, the last two decades have been forgettable for US equities.
There is no denying that market seasonality has not worked so well this year. But we have been here before and history is on our side. Over the long term, intermediate term and short term market seasonality has suffered brief periods when seasonality was overridden by more powerful forces. The COVID pandemic and economic shutdown certainly qualifies. But it is only a matter of time until repetitive human behavior patterns and people and institutions return to moving money around in the usual daily, weekly, monthly, quarterly and seasonal patterns. The return of perennial September weakness is emblematic of a return to normal market behavior and a reflection of the fact that despite the continuing concerns about surges in coronavirus cases life is beginning to return to normal. In our area, about 25-30 miles north of New York City, our kids are beginning hybrid learning, playing rugby, lacrosse and other sports (yes with some COVID protocols, but tackling and facing-off), golf outings are happening and people are going to restaurants and out and about. The chart here shows the historical One-Year Pattern of the S&P 500 Since 1950 versus 2020. The black line shows the seasonal pattern since 1950. The blue represents the pattern since 1988. We use 1988 as it is the first year after the 1987 Crash when the market underwent a major systemic change with the implementation of downside protection circuit breakers and collars. It is noteworthy how the seasonal pattern persists during both the 70-year and 31-year timeframes. 2020 is plotted on the right axis due to the magnitude of the move this year. The yellow box highlights the rebirth of seasonality this September, especially during this notoriously negative Week After Triple Witching Week as detailed page 108 of the 2020 Almanac, indicated by the two black arrows Years like 1980, 1982, 2009 and 2016 with unseasonably early weakness and bear markets like 2020 returned to normal seasonal patterns in short order. And years like 1954, 1958, 1980, 1982, 1995 and 2009 that exhibited double-digit gains in the Worst Six Months still proceeded to deliver further sizable gains in the subsequent Best Six Months (page 52, STA 2020). We believe the return of market seasonality is upon us. So remain cautious through the end of September and be alert to Octoberophobia, but remain ready to pounce on our Best Months Seasonal MACD Buy Signal, when it triggers.
Below are some of the notable companies coming out with earnings releases this upcoming trading week ahead which includes the date/time of release & consensus estimates courtesy of Earnings Whispers:
Monday 10.5.20 Before Market Open:
([CLICK HERE FOR MONDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES!]())
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Monday 10.5.20 After Market Close:
([CLICK HERE FOR MONDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES!]())
([CLICK HERE FOR THURSDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES!]())
(NONE.)
Friday 10.9.20 Before Market Open:
([CLICK HERE FOR FRIDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES!]())
(NONE.)
Friday 10.9.20 After Market Close:
([CLICK HERE FOR FRIDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES!]())
(NONE.)
Domino's Pizza, Inc. $433.78
Domino's Pizza, Inc. (DPZ) is confirmed to report earnings at approximately 7:30 AM ET on Thursday, October 8, 2020. The consensus earnings estimate is $2.73 per share on revenue of $944.53 million and the Earnings Whisper ® number is $2.83 per share. Investor sentiment going into the company's earnings release has 76% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 33.17% with revenue increasing by 15.07%. Short interest has decreased by 31.5% since the company's last earnings release while the stock has drifted higher by 7.4% from its open following the earnings release to be 22.3% above its 200 day moving average of $354.71. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 7.3% move on earnings and the stock has averaged a 8.2% move in recent quarters.
Paychex, Inc. (PAYX) is confirmed to report earnings at approximately 8:30 AM ET on Tuesday, October 6, 2020. The consensus earnings estimate is $0.56 per share on revenue of $895.39 million and the Earnings Whisper ® number is $0.57 per share. Investor sentiment going into the company's earnings release has 49% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 21.13% with revenue decreasing by 9.74%. Short interest has decreased by 9.7% since the company's last earnings release while the stock has drifted higher by 2.8% from its open following the earnings release to be 6.0% above its 200 day moving average of $74.91. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, September 18, 2020 there was some notable buying of 1,269 contracts of the $90.00 call expiring on Friday, March 19, 2021. Option traders are pricing in a 4.8% move on earnings and the stock has averaged a 2.1% move in recent quarters.
RPM International Inc. (RPM) is confirmed to report earnings at approximately 6:45 AM ET on Wednesday, October 7, 2020. The consensus earnings estimate is $1.21 per share on revenue of $1.49 billion and the Earnings Whisper ® number is $1.26 per share. Investor sentiment going into the company's earnings release has 65% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 27.37% with revenue increasing by 1.17%. Short interest has decreased by 39.7% since the company's last earnings release while the stock has drifted higher by 3.3% from its open following the earnings release to be 12.4% above its 200 day moving average of $73.51. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 4.4% move on earnings and the stock has averaged a 2.3% move in recent quarters.
Helen of Troy Ltd. (HELE) is confirmed to report earnings at approximately 6:30 AM ET on Thursday, October 8, 2020. The consensus earnings estimate is $2.39 per share on revenue of $451.26 million and the Earnings Whisper ® number is $2.57 per share. Investor sentiment going into the company's earnings release has 62% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 18.91% with revenue increasing by 9.00%. Short interest has decreased by 6.4% since the company's last earnings release while the stock has drifted lower by 4.4% from its open following the earnings release to be 12.8% above its 200 day moving average of $177.13. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 5.7% move on earnings and the stock has averaged a 8.9% move in recent quarters.
Acuity Brands, Inc. (AYI) is confirmed to report earnings at approximately 8:40 AM ET on Thursday, October 8, 2020. The consensus earnings estimate is $2.01 per share on revenue of $814.63 million and the Earnings Whisper ® number is $2.12 per share. Investor sentiment going into the company's earnings release has 46% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 28.21% with revenue decreasing by 13.16%. Short interest has increased by 62.6% since the company's last earnings release while the stock has drifted higher by 5.6% from its open following the earnings release to be 4.1% above its 200 day moving average of $101.43. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 5.8% move on earnings and the stock has averaged a 9.0% move in recent quarters.
Levi Strauss & Co. (LEVI) is confirmed to report earnings at approximately 4:00 PM ET on Tuesday, October 6, 2020. The consensus estimate is for a loss of $0.27 per share on revenue of $766.84 million and the Earnings Whisper ® number is ($0.20) per share. Investor sentiment going into the company's earnings release has 40% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 187.10% with revenue decreasing by 47.01%. Short interest has increased by 3.9% since the company's last earnings release while the stock has drifted higher by 7.3% from its open following the earnings release to be 3.5% below its 200 day moving average of $14.66. Overall earnings estimates have been revised higher since the company's last earnings release. On Friday, October 2, 2020 there was some notable buying of 8,166 contracts of the $14.00 call expiring on Friday, October 16, 2020. Option traders are pricing in a 10.6% move on earnings and the stock has averaged a 6.9% move in recent quarters.
Lamb Weston Holdings, Inc. (LW) is confirmed to report earnings at approximately 8:30 AM ET on Wednesday, October 7, 2020. The consensus earnings estimate is $0.30 per share on revenue of $877.60 million and the Earnings Whisper ® number is $0.28 per share. Investor sentiment going into the company's earnings release has 36% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 62.03% with revenue decreasing by 11.26%. Short interest has decreased by 21.7% since the company's last earnings release while the stock has drifted higher by 4.1% from its open following the earnings release to be 1.8% below its 200 day moving average of $69.17. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, October 2, 2020 there was some notable buying of 1,580 contracts of the $70.00 call expiring on Friday, October 16, 2020. Option traders are pricing in a 8.3% move on earnings and the stock has averaged a 6.7% move in recent quarters.
Landec Corp. (LNDC) is confirmed to report earnings at approximately 4:20 PM ET on Tuesday, October 6, 2020. The consensus estimate is for a loss of $0.11 per share on revenue of $127.86 million and the Earnings Whisper ® number is ($0.09) per share. Investor sentiment going into the company's earnings release has 41% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 31.25% with revenue decreasing by 7.82%. Short interest has decreased by 5.1% since the company's last earnings release while the stock has drifted lower by 12.3% from its open following the earnings release to be 8.4% below its 200 day moving average of $10.30. Overall earnings estimates have been revised lower since the company's last earnings release. Option traders are pricing in a 16.7% move on earnings and the stock has averaged a 10.6% move in recent quarters.
Saratoga Investment Corp (SAR) is confirmed to report earnings at approximately 4:00 PM ET on Wednesday, October 7, 2020. The consensus earnings estimate is $0.47 per share on revenue of $12.95 million. Investor sentiment going into the company's earnings release has 48% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 30.88% with revenue decreasing by 6.75%. Short interest has decreased by 60.5% since the company's last earnings release while the stock has drifted higher by 6.3% from its open following the earnings release. Overall earnings estimates have been revised lower since the company's last earnings release.
EXFO Inc. (EXFO) is confirmed to report earnings at approximately 4:00 PM ET on Wednesday, October 7, 2020. The consensus earnings estimate is $0.07 per share on revenue of $64.85 million and the Earnings Whisper ® number is $0.07 per share. Investor sentiment going into the company's earnings release has 30% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 40.00% with revenue decreasing by 7.59%. Short interest has decreased by 17.5% since the company's last earnings release while the stock has drifted lower by 14.7% from its open following the earnings release. Overall earnings estimates have been revised higher since the company's last earnings release.
Wall Street Week Ahead for the trading week beginning October 5th, 2020
Good Saturday morning to all of you here on smallstreetbets. I hope everyone on this sub made out pretty nicely in the market this past week, and is ready for the new trading week ahead. Here is everything you need to know to get you ready for the trading week beginning October 5th, 2020.
Trump’s health and fiscal stimulus fight will steer the markets in the week ahead - (Source)
President Donald Trump’s health and the state of a fiscal stimulus package will be the main focus for markets in the coming week. In the early morning hours Friday, President Donald Trump tweeted that he and the first lady tested positive for Covid. Stocks sold off hard, but the S&P 500 came off its lows in Friday trading and closed down just under 1%. It was up 1.5% for the week. The market was helped by signs that a stimulus package is still a possibility, after House Speaker Nancy Pelosi asked airlines not to furlough workers. She promised either a stand alone aid bill, or a bigger negotiated relief legislation that would help the industry. “The market is going to watch health updates from the White House medical staff, and it’s going to watch how the president communicates with the public,” said Julian Emanuel, head of equities and derivatives at BTIG. “Will we see him in person in the next week in any form? What’s his volume of tweets? All as a way to first gauge the severity of the case.” Trump and Melania Trump are reported to have mild cases, but as time goes on the market will turn to how the illness could impact the presidential election. Former Vice President Joe Biden gained slightly in the polls after the first debate Tuesday night, and now the calendar for further debates is in question. The market has seemingly warmed to Biden, and even though he would raise taxes, it is assumed Democrats would quickly pass a major infrastructure package if there is a Democratic sweep of Congress. Trump, however, is widely seen on Wall Street as stronger on the economy and better for markets. “What you’ve done from a campaign perspective, is you’ve taken away the thing that gives him the most energy - his ability to interact with crowds,” said Emanuel. “The president had wanted to paint the economic recovery of the last three or four months as the cornerstone, and this basically puts the virus back as topic number 1, number 2 and number 3. And it’s all the more so because the data is coming in weaker than expected.” The market is fixated on the prospect of stimulus to help business, the unemployed and state and local governments. The House passed a $2.2 trillion package this week, but there is still no agreement with Republicans. Treasury Secretary Steven Mnuchin has pushed for a $1.6 trillion package. “I think there’s an underlying bid under the market because nobody wants to be super short if we get a stimulus approved, but you can’t be too long in case his mild symptoms turn into severe symptoms,” said Scott Redler, partner with T3live.com. “We’re in a tough spot but overall we’re still pretty constructive.” Emanuel said the fact the president is now ill could hurt confidence and slow down some of the improvement in the economy. “The underlying tone is, again, whether its directly or later, there’s going to be stimulus,” Emanuel said. ”’Whether it’s this month or November, this reinforces the need for stimulus because the president falling ill signals to, at the margin, the person whose thinking about going out to dinner to think again. It’s a significant economic and psychological hindrance.” Also coming up in the week ahead is a speech Tuesday by Fed Chairman Jerome Powell to the National Association of Business Economists. Powell is also expected to push for the stimulus package to boost the economy so the recovery does not stall. “I think his whole objective is to try to get Congress and the Administration to sign onto a fiscal rescue package,” said Mark Zandi, chief economist at Moody’s Analytics. “He’ll all but come out and say [the recovery] is not a ‘V.’ Without additional support from lawmakers, risks are pretty high that we backtrack. I think that’s the kind of outlook he’s going to give. It’s going to be full-throated.” September’s employment report, released Friday, was seen by some as a warning that the economy is not rebounding as expected. There were 661,000 jobs added in September, well below the 800,000 expected. Besides Powell, there are a half dozen other Fed speakers. There are also minutes from the Fed’s last minute released Wednesday afternoon.
This past week saw the following moves in the S&P:
We've all had versions of this conversation where you or the person you were talking to just couldn't make up their mind. At the end of the day, it only causes trouble and plans are ruined. The market is having its own back and forth this year trying to decide between growth and value. Just today, growth stocks are getting slaughtered while value stocks are up marginally. As an example, the Russell 1000 Growth index is down 1.8% on the day while the Russell 1000 Value index has managed to rally 0.25%. The chart below shows the daily performance spread between the Russell 1000 Growth index and the Russell 1000 Value index for each day in 2020. Today's performance spread between the two indices marks the ninth time this year that value has outperformed growth by more than two percentage points. At the other extreme, there have also been eight trading days where growth outperformed value by more than two percentage points.
So how does this year's frequency of days where the performance spread between the two indices was more than two percentage points stack up to other years? The chart below shows the daily performance spread between the two indices going all the way back to 1990. Over the last thirty years, the only two periods where we saw a frequency of these large daily dislocations was back in 2008 and the period spanning 2000 and 2001. In fact, with 17 days this year where the performance spread between the two indices was greater than two percentage points, the only other years that saw a higher frequency of large dislocations were 2000 (54) and 2001 (28). If you think the market has been indecisive this year, in 2000 we saw these types of daily dislocations an average of once per week.
Election Anxiety Weighs on October Market Performance
October often evokes fear on Wall Street as memories are stirred of crashes in 1929, 1987, the 554-point drop on October 27, 1997, back-to-back massacres in 1978 and 1979, Friday the 13th in 1989 and the 733-point drop on October 15, 2008. During the week ending October 10, 2008, Dow lost 1,874.19 points (18.2%), the worst weekly decline in our database going back to 1901, in percentage terms. March 2020 now holds the dubious honor of producing the worst, second and third worst DJIA weekly point declines. The term “Octoberphobia” has been used to describe the phenomenon of major market drops occurring during the month. Market calamities can become a self-fulfilling prophecy, so stay on the lookout and don’t get whipsawed if it happens. But October has become a turnaround month—a “bear killer” if you will. Twelve post-WWII bear markets have ended in October: 1946, 1957, 1960, 1962, 1966, 1974, 1987, 1990, 1998, 2001, 2002 and 2011 (S&P 500 declined 19.4%). However, eight were midterm bottoms. Over the last 21 years, October’s performance has been solid. Average gains over the last 21-years range from 1.3% by Russell 1000 to 2.4% by NASDAQ. Small caps have still struggled though with Russell 2000 gaining a modest 0.5%
Election-year Octobers rank dead last for Dow, S&P 500 (since 1952), NASDAQ (since 1972), Russell 1000, and Russell 2000 (since 1980). Eliminating gruesome 2008 from the calculation provides a moderate amount of relief, as rankings climb to mid pack. Should a meaningful decline materialize in October it is likely to be an excellent buying opportunity, especially for any depressed technology and small-cap shares.
What Have Democratic Sweeps Meant for the S&P 500?
Headed into the first presidential debate Tuesday night, betting markets (ElectionBettingOdds.com) placed Democratic candidate Joe Biden as the slight favorite to take the White House in November. The debate resulted in Biden gaining another 5 percentage point chance of winning the Presidency. As of this morning, Biden's odds to win are at 59.8% versus Trump's odds of 38.9%. Additionally, Democrats are slight favorites to win control of the Senate (58.4% to 41.5%) and big favorites to maintain the House (82.8% to 17.1%). Given these odds, in the chart below we show the average performance of the S&P 500 from the three months before Election Day through three months after Election Day for all election years post-WWII that resulted in a sweep of the executive and legislative branch by the Democrats. As shown, on average the S&P 500 has been on the decline in the weeks leading up to Election Day, though in the days just before the Election there has been a small rally that sharply reverses once the results come in. After the initial post-Election drop, the market has trended a bit higher, but by three months after the Election, it has only found itself around the same levels as Election Day; on average a 2.6% loss versus where the index stood three months prior.
The composite shown above is comprised of six different years: 1948, 1960, 1964, 1976, 1992, and 2008. While on average the S&P 500 has traded lower, it is not necessarily a sure-fire thing. For example, 1948 and 2008 were the only years that saw the S&P 500 trade and stay significantly lower in the wake of the election. In 1976, there was similarly a sell-off in the immediate aftermath of the election, but the index did make its way back up to the highs of that six-month time frame later on albeit no new high was put in place. Meanwhile, 1960, 1964, and 1992 all saw the S&P 500 run higher after the election even despite some periods of consolidation after initial moves higher. In our B.I.G. Tips report from Tuesday, we show these same charts for all Presidential election years post WWII including a look at the average performance given every potential election outcome.
Even after September's weakness, the S&P 500's trailing 12-month total return stood at an impressive 14.9%. Given the events of the last 12 months, one could even say that performance is remarkable. What's even crazier is that the S&P 500's performance over the last 12 months is more than three times stronger than the 12 month period before that (+4.25%). The chart below compares the S&P 500's annualized total returns over the last one, two, five, ten, and twenty years and compares that performance to the historical average return of the index over those same time periods. The S&P 500's historical average 12-month return is 11.7%, so the current 14.9% gain exceeds that average by more than three full percentage points. Over a two-year window, though, the S&P 500's annualized return of 9.4% is more than a full percentage point below the historical average. Looking further out, the S&P 500's trailing five and ten-year annualized return has been much stronger than average, which makes sense given the long bull market we were in. Over a 20 year window, though, the S&P 500 is only just starting to work off some of the declines from the dot-com bust and as a result, the 6.4% annualized gain is a four and a half percentage points below the long-term average of 10.9%.
Below we show how the current performance of the S&P 500 in each of the time frames shown compares to all other periods on a percentile basis. The S&P 500's performance over the last year, ranks just below 56th percentile of all other periods, while the two-year performance ranks just below the 42nd percentile. Even as the five and ten-year periods have seen well above average returns, they still rank in just the mid-60s on a percentile basis. The S&P 500's ranking over a 20-year time period is a completely different story ranking in single-digits on a percentile basis. Even with the equity market right near record highs, the last two decades have been forgettable for US equities.
There is no denying that market seasonality has not worked so well this year. But we have been here before and history is on our side. Over the long term, intermediate term and short term market seasonality has suffered brief periods when seasonality was overridden by more powerful forces. The COVID pandemic and economic shutdown certainly qualifies. But it is only a matter of time until repetitive human behavior patterns and people and institutions return to moving money around in the usual daily, weekly, monthly, quarterly and seasonal patterns. The return of perennial September weakness is emblematic of a return to normal market behavior and a reflection of the fact that despite the continuing concerns about surges in coronavirus cases life is beginning to return to normal. In our area, about 25-30 miles north of New York City, our kids are beginning hybrid learning, playing rugby, lacrosse and other sports (yes with some COVID protocols, but tackling and facing-off), golf outings are happening and people are going to restaurants and out and about. The chart here shows the historical One-Year Pattern of the S&P 500 Since 1950 versus 2020. The black line shows the seasonal pattern since 1950. The blue represents the pattern since 1988. We use 1988 as it is the first year after the 1987 Crash when the market underwent a major systemic change with the implementation of downside protection circuit breakers and collars. It is noteworthy how the seasonal pattern persists during both the 70-year and 31-year timeframes. 2020 is plotted on the right axis due to the magnitude of the move this year. The yellow box highlights the rebirth of seasonality this September, especially during this notoriously negative Week After Triple Witching Week as detailed page 108 of the 2020 Almanac, indicated by the two black arrows Years like 1980, 1982, 2009 and 2016 with unseasonably early weakness and bear markets like 2020 returned to normal seasonal patterns in short order. And years like 1954, 1958, 1980, 1982, 1995 and 2009 that exhibited double-digit gains in the Worst Six Months still proceeded to deliver further sizable gains in the subsequent Best Six Months (page 52, STA 2020). We believe the return of market seasonality is upon us. So remain cautious through the end of September and be alert to Octoberophobia, but remain ready to pounce on our Best Months Seasonal MACD Buy Signal, when it triggers.
Below are some of the notable companies coming out with earnings releases this upcoming trading week ahead which includes the date/time of release & consensus estimates courtesy of Earnings Whispers:
Monday 10.5.20 Before Market Open:
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Monday 10.5.20 After Market Close:
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Friday 10.9.20 Before Market Open:
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Friday 10.9.20 After Market Close:
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Domino's Pizza, Inc. $433.78
Domino's Pizza, Inc. (DPZ) is confirmed to report earnings at approximately 7:30 AM ET on Thursday, October 8, 2020. The consensus earnings estimate is $2.73 per share on revenue of $944.53 million and the Earnings Whisper ® number is $2.83 per share. Investor sentiment going into the company's earnings release has 76% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 33.17% with revenue increasing by 15.07%. Short interest has decreased by 31.5% since the company's last earnings release while the stock has drifted higher by 7.4% from its open following the earnings release to be 22.3% above its 200 day moving average of $354.71. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 7.3% move on earnings and the stock has averaged a 8.2% move in recent quarters.
Paychex, Inc. (PAYX) is confirmed to report earnings at approximately 8:30 AM ET on Tuesday, October 6, 2020. The consensus earnings estimate is $0.56 per share on revenue of $895.39 million and the Earnings Whisper ® number is $0.57 per share. Investor sentiment going into the company's earnings release has 49% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 21.13% with revenue decreasing by 9.74%. Short interest has decreased by 9.7% since the company's last earnings release while the stock has drifted higher by 2.8% from its open following the earnings release to be 6.0% above its 200 day moving average of $74.91. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, September 18, 2020 there was some notable buying of 1,269 contracts of the $90.00 call expiring on Friday, March 19, 2021. Option traders are pricing in a 4.8% move on earnings and the stock has averaged a 2.1% move in recent quarters.
RPM International Inc. (RPM) is confirmed to report earnings at approximately 6:45 AM ET on Wednesday, October 7, 2020. The consensus earnings estimate is $1.21 per share on revenue of $1.49 billion and the Earnings Whisper ® number is $1.26 per share. Investor sentiment going into the company's earnings release has 65% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 27.37% with revenue increasing by 1.17%. Short interest has decreased by 39.7% since the company's last earnings release while the stock has drifted higher by 3.3% from its open following the earnings release to be 12.4% above its 200 day moving average of $73.51. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 4.4% move on earnings and the stock has averaged a 2.3% move in recent quarters.
Helen of Troy Ltd. (HELE) is confirmed to report earnings at approximately 6:30 AM ET on Thursday, October 8, 2020. The consensus earnings estimate is $2.39 per share on revenue of $451.26 million and the Earnings Whisper ® number is $2.57 per share. Investor sentiment going into the company's earnings release has 62% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 18.91% with revenue increasing by 9.00%. Short interest has decreased by 6.4% since the company's last earnings release while the stock has drifted lower by 4.4% from its open following the earnings release to be 12.8% above its 200 day moving average of $177.13. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 5.7% move on earnings and the stock has averaged a 8.9% move in recent quarters.
Acuity Brands, Inc. (AYI) is confirmed to report earnings at approximately 8:40 AM ET on Thursday, October 8, 2020. The consensus earnings estimate is $2.01 per share on revenue of $814.63 million and the Earnings Whisper ® number is $2.12 per share. Investor sentiment going into the company's earnings release has 46% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 28.21% with revenue decreasing by 13.16%. Short interest has increased by 62.6% since the company's last earnings release while the stock has drifted higher by 5.6% from its open following the earnings release to be 4.1% above its 200 day moving average of $101.43. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 5.8% move on earnings and the stock has averaged a 9.0% move in recent quarters.
Levi Strauss & Co. (LEVI) is confirmed to report earnings at approximately 4:00 PM ET on Tuesday, October 6, 2020. The consensus estimate is for a loss of $0.27 per share on revenue of $766.84 million and the Earnings Whisper ® number is ($0.20) per share. Investor sentiment going into the company's earnings release has 40% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 187.10% with revenue decreasing by 47.01%. Short interest has increased by 3.9% since the company's last earnings release while the stock has drifted higher by 7.3% from its open following the earnings release to be 3.5% below its 200 day moving average of $14.66. Overall earnings estimates have been revised higher since the company's last earnings release. On Friday, October 2, 2020 there was some notable buying of 8,166 contracts of the $14.00 call expiring on Friday, October 16, 2020. Option traders are pricing in a 10.6% move on earnings and the stock has averaged a 6.9% move in recent quarters.
Lamb Weston Holdings, Inc. (LW) is confirmed to report earnings at approximately 8:30 AM ET on Wednesday, October 7, 2020. The consensus earnings estimate is $0.30 per share on revenue of $877.60 million and the Earnings Whisper ® number is $0.28 per share. Investor sentiment going into the company's earnings release has 36% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 62.03% with revenue decreasing by 11.26%. Short interest has decreased by 21.7% since the company's last earnings release while the stock has drifted higher by 4.1% from its open following the earnings release to be 1.8% below its 200 day moving average of $69.17. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, October 2, 2020 there was some notable buying of 1,580 contracts of the $70.00 call expiring on Friday, October 16, 2020. Option traders are pricing in a 8.3% move on earnings and the stock has averaged a 6.7% move in recent quarters.
Landec Corp. (LNDC) is confirmed to report earnings at approximately 4:20 PM ET on Tuesday, October 6, 2020. The consensus estimate is for a loss of $0.11 per share on revenue of $127.86 million and the Earnings Whisper ® number is ($0.09) per share. Investor sentiment going into the company's earnings release has 41% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 31.25% with revenue decreasing by 7.82%. Short interest has decreased by 5.1% since the company's last earnings release while the stock has drifted lower by 12.3% from its open following the earnings release to be 8.4% below its 200 day moving average of $10.30. Overall earnings estimates have been revised lower since the company's last earnings release. Option traders are pricing in a 16.7% move on earnings and the stock has averaged a 10.6% move in recent quarters.
Saratoga Investment Corp (SAR) is confirmed to report earnings at approximately 4:00 PM ET on Wednesday, October 7, 2020. The consensus earnings estimate is $0.47 per share on revenue of $12.95 million. Investor sentiment going into the company's earnings release has 48% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 30.88% with revenue decreasing by 6.75%. Short interest has decreased by 60.5% since the company's last earnings release while the stock has drifted higher by 6.3% from its open following the earnings release. Overall earnings estimates have been revised lower since the company's last earnings release.
EXFO Inc. (EXFO) is confirmed to report earnings at approximately 4:00 PM ET on Wednesday, October 7, 2020. The consensus earnings estimate is $0.07 per share on revenue of $64.85 million and the Earnings Whisper ® number is $0.07 per share. Investor sentiment going into the company's earnings release has 30% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 40.00% with revenue decreasing by 7.59%. Short interest has decreased by 17.5% since the company's last earnings release while the stock has drifted lower by 14.7% from its open following the earnings release. Overall earnings estimates have been revised higher since the company's last earnings release.
United’s hopeless pursuit of Jadon Sancho – the real story Laurie Whitwell, David Ornstein and more(Other contributor: Raphael Honigstein) Ole Gunnar Solskjaer identified Jadon Sancho as his principal target this summer in what was seen as a vital opportunity for squad enhancement following Champions League qualification. But after 10 weeks of opportunity for talks, Sancho remains a Borussia Dortmund player and the simple truth is that United never got close. The Athletic has been told that Solskjaer urged Ed Woodward to keep trying, and financial concerns meant other signings were pushed to the periphery until the final 48 hours of the window. Donny van de Beek arrived on September 2 but sources say United waited to pull the trigger on other purchases until it became clear Sancho was not arriving. So for the third window in a row, United were active on deadline day, completing the signings of Edinson Cavani, Alex Telles, Amad Diallo and Facundo Pellistri. In January, it was Odion Ighalo, hot on the heels of Bruno Fernandes. Last summer, the club were trying to sign Mario Mandzukic or Paulo Dybala. The cause for this year’s unedifying sense of late freneticism appears to centre on the priority given to the Sancho move and, fundamentally, a misunderstanding by United of Dortmund’s intentions. Essentially, United did not believe Dortmund would stay firm on the price-tag of €120 million or their deadline of August 10, embarking on a long-running game of poker without realising that the Bundesliga club weren’t even at the table. United effectively sat still in the hope Dortmund would blink first and place the call they were ready to do business. Intermediaries attempted to broker a deal but were waiting on United to move, which did not happen. Some sources felt Woodward was holding until the last moment to place an all-in bet, giving the impression of resistance in the ambition of driving the price down. But instead, United kept their chips and stayed true to their valuation. By never ruling themselves out of the deal though, United’s actions seriously annoyed Dortmund’s executives, who became even more entrenched in their position as the weeks went on. When Dortmund sporting director Michael Zorc stood at the side of their training pitches on August 10, the first day of pre-season, and said the decision on Sancho staying was “final”, one alarmed United director made a call to check whether the statement was genuine. The response was along the lines of, “What did you expect? You knew the terms.” Hans-Joachim Watzke, Dortmund’s chief executive, is said to have personally phoned United at the start of the summer and explained very clearly how much the deal would cost and when it needed to be done by. United privately argue that the continued conversations after that point, conducted via intermediaries Emeka Obasi and Marco Lichtsteiner, were evidence of Dortmund remaining open to a sale. But the reason for the involvement of agents is hotly disputed. United insist Dortmund wanted talks done through Obasi and Lichtsteiner, and some believe this was so Dortmund could stick to their public stance while having a backchannel to a potential resolution. United held lengthy discussions and made known what they were willing to pay, which held a firm limit given the current economic environment. Sources say Dortmund reject that idea and deny they ever appointed agents. Previous deals with Arsenal and Barcelona for Pierre-Emerick Aubameyang and Ousmane Dembele respectively were based on face-to-face meetings with club counterparts. On this occasion, they believed that they had provided the fee to United and since Woodward failed to match it by August 10, there was no need for further direct discussion. United felt there was tacit encouragement to keep lines of communication going but the only way they could have got the deal on after that date was with a “crazy” offer along the lines of Neymar’s £200 million transfer to Paris Saint-Germain. Sources told The Athletic that if United had come in with an offer of €140-£150 million then Dortmund might have done business. Conscious of their reputation having set their position out so publicly, Dortmund would have been able to sell that as a turnaround made in extraordinary circumstances. United argued that the €120 million price tag did not take into account the financial hit caused by the pandemic. Executives genuinely felt it should come down, given the full total of the transfer was potentially enormous. The Athletic has been told initial calculations rose to €250 million including wages and agent fees. United made what has been described as a “calm decision” to refuse that amount and felt vindicated when the government postponed the return of fans to stadiums costing the club another £50 million in lost revenue. But it is understood that Dortmund originally planned for the €120 million as a “minimum” — and ideally wanted nearer the €147 million fee that Barcelona paid for Dembele — so it was an adjustment to even consider a bid that could reach that figure in installments. In any case, United never got near to that guaranteed sum. One offer, submitted by chief negotiator Matt Judge through the agents in the final week of September, amounted to £80 million, plus add-ons. Once passed to Watzke, it was immediately rejected as too little too late. There was a sense at the Westfalenstadion that United did not take Dortmund’s demands seriously or were acting without full intentions to actually complete the signing. All proposals were said to have been relayed to Dortmund via the agents knowing full well they would be turned down. Sancho himself is believed to have felt undervalued by the offers and even if United had placed the right bid late on, it is understood he would have questioned why it did not come earlier. Sancho was never going to agitate for a move unless United came close to Dortmund’s demands. Illness kept him out of the squad for Saturday’s 4-0 win over Freiburg but Sancho then attended a house party in London with Tammy Abraham and Ben Chilwell, in breach of lockdown rules, and will join up late with England as a result. He has since apologised. The forward was prepared to join United but not “desperate” to move this summer. He was relaxed either way. That was the sense drawn by England team-mates at the September camp. That being said, others close to United were under the impression he “would walk to Old Trafford”. Sancho texted Marcus Rashford about United, and the pair were said to be excited at the prospect of linking up. Sancho has many friends in Manchester from his time at Manchester City. Other United players were in touch too and so was Solskjaer, who as long ago as January wanted to ascertain Sancho’s willingness to join and to get a personal sense of his character. Having privately acknowledged the possibility of a sale, Dortmund were aware of the conversations, which are standard for most transfers. There had actually been dialogue with Sancho’s representatives dating back to when he left Manchester City for Dortmund in 2017, but talks commenced in earnest this year once United had secured Champions League football on July 26. United’s exit from the Europa League was disappointing, but some close to the club felt it would at least reinforce the impetus for signings — a reminder to the Glazer family that funding was required to take the next step. “But extending the window to October 5 is probably the worst thing for Solskjaer,” said a source. “I can see United taking talks to the wire again.” There were some raised eyebrows at United over reports of Sancho’s lateness to training and fines for breaching lockdown regulations in Germany. But United viewed the indiscretions as attributable to a desire to move on from Dortmund. “We’ll make Carrington a place where he wants to come to work every day,” one member of staff told a colleague. Solskjaer had determined Sancho would be his main target, with one source saying in April: “We are ready to go, we know who we want, the people at the top are now certain.” But that conviction was not found in the pursuit, with Dortmund soon frustrated at United’s reluctance to commit to a fee or structure. There were allegations of “freestyling”, a refusal to provide a top line, and when pushed for answers, Judge suggested the issue lay with “the owners”. Agents proposing other players were told of a £50 million net spend budget. Executives feel they have a responsibility to protect the long-term strength of the club by not over-paying. The Athletic has previously reported how Joel Glazer, in daily contact with Woodward, is involved in all major signings and paid particularly close attention to the Sancho deal. There were accusations of a split in opinion between the pair over the price to be sanctioned, with Woodward advocating a higher fee, but United insist board members were united on their view that €120 million was too much in the post-COVID-19 climate. Recruitment staff were told about a significant budget being allocated to Sancho but later the internal line back from Woodward was that the deal was “too much money”. Privately United suggested the €120 million figure could be reached including some unrealistic bonuses, which may have allowed Dortmund to save face with a headline figure. Dortmund were resolute in their stance though and believed a higher price could be achieved next summer. The cause for their confidence was revealed when Zorc announced a previously unknown extension to Sancho’s contract, meaning it did not run out until 2023. United insist they knew all those details and were for a long time frustrated by what they perceived to be the slow process of dealing with Dortmund through Obasi, Sancho’s agent, and Lichtsteiner, the brother of former Arsenal player Stephan. The two intermediaries are described as “very close”. Lichtsteiner previously assisted on the departures of Aubameyang and Dembele to Arsenal and Barcelona respectively, and has vast experience of difficult transfers. He is said to be well-regarded and very discreet with information. United have in the past worked on deals through agents, and last summer placed an offer for the Newcastle United midfielder Sean Longstaff in this manner. Sources at Newcastle suspected this was so United had deniability if unsuccessful. On other occasions, the technique has worked well. Woodward conducted the purchase of Juan Mata from Chelsea without one word to his counterparts at Stamford Bridge to block any chance of Wayne Rooney being brought into the conversation. Chelsea wanted to buy Rooney that window. Before any fee could be finalised this time, there were difficulties over wages and agent fees. It has been suggested to The Athletic that the opening contract offer to Sancho was actually slightly lower than his Dortmund salary. As is customary in Germany, Sancho’s contract was heavily incentivised and contained bonus payments for each point Dortmund achieved. Conscious of maintaining a certain wage structure, United’s initial proposal was less than Sancho’s total pay packet at Dortmund. Van de Beek joined on £110,000 a week, for instance, and his representatives were told that was in line with a refined structure given Fernandes signed for £150,000 a week. A second offer to Sancho, in early August, is said to have achieved parity with his Dortmund deal, with the potential for a fractional increase based on performance. This was not accepted. Sancho’s representatives, who carefully organised a move away from City in 2017, were clear in their view of Sancho’s worth and expected to be recompensed as such. Though not asking for money equitable to David De Gea, who signed a deal worth more than £375,000 a week within the final 12 months of becoming a free agent, the terms desired were thought to be in the region of Paul Pogba’s £250,000 a week. There were reports that wages had been sorted in the first week of August but this was not the case. United believed leaks to that end emanating from Germany were an attempt to “put pressure” on the process. Still, there was positivity about a solution. Sources say the Liverpool manager Jurgen Klopp was keeping himself abreast of Sancho’s situation and around this stage told friends he believed the player would end up at Old Trafford. There was eventually a breakthrough on Sancho’s salary in the second week of September. Running parallel were negotiations over agent fees. Some have suggested an initial proposal for a payment to the agents put United on the back foot. After negotiations, a lower sum was agreed. But that still left the transfer fee and, as the gap remained, other options were considered. A prospective loan deal for Gareth Bale was set up but the Wales international declined to wait as a reserve for Sancho. He had the emotional pull of Tottenham Hotspur in any case. Watford’s Ismaila Sarr, previously not regarded as a genuine option, came into the reckoning in the final fortnight of the window when United explored a loan move. With Watford in the Championship, Sarr has until the domestic deadline of October 16 to join a Premier League club. Talks also commenced over Dembele. An original inquiry for the Barcelona forward was made in July but at that stage, Dembele was not interested. Sources say Liverpool also made a check back then. But while Liverpool instead signed Diogo Jota on September 19, it was United returning in the dying embers of the market to investigate whether Dembele might join on loan. It was a late move. A source close to the Barcelona dressing room said at the time: “He intended to stay at Barcelona. In pre-season, his attitude was really different and the players were super happy to see how he was training and how involved in the routine. Therefore, everything has to have changed a lot for him to have decided to go to United.” In the end, United only wanted a loan. Barcelona demanded a sale, so the situation looked unlikely to develop until a late change of stance by the La Liga club on Monday evening. Barcelona indicated they would agree to a loan but only if Dembele extended his contract at the Nou Camp, and the deal was off. Industry insiders reported numerous other inquiries and proposals put to the club by representatives, such as Real Madrid’s Luka Jovic, Inter Milan’s Ivan Perisic and Juventus’ Douglas Costa. There was exasperation among some at Carrington that United were leaving business so late again and having to work down their list to second and third options. “Looks like a panic buy,” was the assessment by one source close to the dressing room of the Cavani signing. United did ask Bayer Leverkusen for Kai Havertz in January but were put off by the €100 million fee and never made a follow-up call this summer, clearing the path to Chelsea. Meanwhile, the Sancho failure represents the third time Dortmund have got their way over United this year, after the signings of Erling Haaland and Jude Bellingham — two episodes that have caused lingering frustration. Some agents who have worked with United on other deals believe the club should have halted talks on Sancho much earlier if €120 million was seen as too much and pursued alternatives. There are accusations the delay speaks to a fundamental issue in recruitment, which sources call a paralysis of decision-making. But given how much Solskjaer wanted Sancho, United wanted to try for their No 1 target for as long as possible. United accept they have missed out on a top player but insist they have not over-extended their finances. The signings of Diallo and Pellistri, both 18-year-old wingers, are regarded as viable options for the first-team once bedded into England through the under-21s side. Diallo’s cost of €21 million plus €20 million is not insignificant, however, inevitably inviting questions about why United refused the extra money for Sancho. Diallo has been scouted since 2016 and is considered one of the most exciting prospects in Italy. There are echoes when Anthony Martial signed for big expense and little experience and became Joel Glazer’s favourite player. Sancho will stay in the crosshairs, for the next time trading opens. It’s understood he long since shifted his focus to a future transfer rather than moving in the current window. But it is anticipated more clubs will be in the reckoning for his signature by then.
Cappers Direct- Beware of this handicapping company- Kyle Johnson
I wanted to get the word out there as it is only a matter of time that other people will fall into the same trap that I did. I wanted to share my legit experience with paying for packages for sports betting from this guy "Kyle" Johnson at Cappers Direct. I have been betting sports for a long time and follow numerous handicappers but when I saw his Youtube videos and free plays that I won money on I started to support and follow his channel more. He ran a promotion for "premium" and "personal" plays so I decided to buy and support him. I got 3 days of plays with a guarantee that if I did not profit he would continue the package until it was profitable. COOL sounds good right? well it was not long after that he ran another promotion for a march madness package with a guarantee that he would hit a certain win % or give you additional plays. I bought it as well even though I was already losing on his premium package. Fast forward a little -- COVID hits and there are no sports. He reaches out saying if we would like to put our March Madness package on hold to let them know. I knew I could not bet the other sports during the pandemic so I obviously replied and said to put it on hold. Well ever since he essentially has given me the ole " bait and switch", ignored over half my inquiries when I reached out, acted like I had the wrong email, said I should "hear something in the coming weeks" Fast forward weeks go by- I reach out again. He is extremely defensive and says good luck getting my money back because our terms and conditions say we blah blah blah... well he very well knows he ripped me and probably others who aren't smart enough to spread their story. That was a long story basically to summarize that this company has a nice little scam going. They sell overprice picks, over-hyping their wins and downplaying their losses- meanwhile churning and burning through more customers who do not know how their money is being used... IF I had to guess, this little "selling packages" bit makes it easier to post "big tickets" which he often brags about on his channel. Well its easy to show big tickets when you are ripping people off.. Beware of this shady guy Kyle Johnson/Cappers direct. I will be sure to keep spreading the word as I have the entire history between our correspondence documented to prove just how shiesty this guy/company really is. Luckily I only wasted a few hundred dollars and I did not buy one of his larger packages. Sure... I did get some or part of what they marketed in the package, but considering I did not get even close to the bulk of what the package was being promoted on, one would think they would do something to compensate them. I guess they would rather have a bad reputation in an industry where everyone knows everyone. On a positive note there are a TON of honest and transparent cappers who actually do follow through and care about their customers. Go check out anyone who keeps a posted record/results and is not shy about being transparent. There are some other reddit posts that talk about a lot of them just do a search!
Wall Street Week Ahead for the trading week beginning October 5th, 2020
Good Saturday morning to all of you here on stocks. I hope everyone on this sub made out pretty nicely in the market this past week, and is ready for the new trading week ahead. Here is everything you need to know to get you ready for the trading week beginning October 5th, 2020.
Trump’s health and fiscal stimulus fight will steer the markets in the week ahead - (Source)
President Donald Trump’s health and the state of a fiscal stimulus package will be the main focus for markets in the coming week. In the early morning hours Friday, President Donald Trump tweeted that he and the first lady tested positive for Covid. Stocks sold off hard, but the S&P 500 came off its lows in Friday trading and closed down just under 1%. It was up 1.5% for the week. The market was helped by signs that a stimulus package is still a possibility, after House Speaker Nancy Pelosi asked airlines not to furlough workers. She promised either a stand alone aid bill, or a bigger negotiated relief legislation that would help the industry. “The market is going to watch health updates from the White House medical staff, and it’s going to watch how the president communicates with the public,” said Julian Emanuel, head of equities and derivatives at BTIG. “Will we see him in person in the next week in any form? What’s his volume of tweets? All as a way to first gauge the severity of the case.” Trump and Melania Trump are reported to have mild cases, but as time goes on the market will turn to how the illness could impact the presidential election. Former Vice President Joe Biden gained slightly in the polls after the first debate Tuesday night, and now the calendar for further debates is in question. The market has seemingly warmed to Biden, and even though he would raise taxes, it is assumed Democrats would quickly pass a major infrastructure package if there is a Democratic sweep of Congress. Trump, however, is widely seen on Wall Street as stronger on the economy and better for markets. “What you’ve done from a campaign perspective, is you’ve taken away the thing that gives him the most energy - his ability to interact with crowds,” said Emanuel. “The president had wanted to paint the economic recovery of the last three or four months as the cornerstone, and this basically puts the virus back as topic number 1, number 2 and number 3. And it’s all the more so because the data is coming in weaker than expected.” The market is fixated on the prospect of stimulus to help business, the unemployed and state and local governments. The House passed a $2.2 trillion package this week, but there is still no agreement with Republicans. Treasury Secretary Steven Mnuchin has pushed for a $1.6 trillion package. “I think there’s an underlying bid under the market because nobody wants to be super short if we get a stimulus approved, but you can’t be too long in case his mild symptoms turn into severe symptoms,” said Scott Redler, partner with T3live.com. “We’re in a tough spot but overall we’re still pretty constructive.” Emanuel said the fact the president is now ill could hurt confidence and slow down some of the improvement in the economy. “The underlying tone is, again, whether its directly or later, there’s going to be stimulus,” Emanuel said. ”’Whether it’s this month or November, this reinforces the need for stimulus because the president falling ill signals to, at the margin, the person whose thinking about going out to dinner to think again. It’s a significant economic and psychological hindrance.” Also coming up in the week ahead is a speech Tuesday by Fed Chairman Jerome Powell to the National Association of Business Economists. Powell is also expected to push for the stimulus package to boost the economy so the recovery does not stall. “I think his whole objective is to try to get Congress and the Administration to sign onto a fiscal rescue package,” said Mark Zandi, chief economist at Moody’s Analytics. “He’ll all but come out and say [the recovery] is not a ‘V.’ Without additional support from lawmakers, risks are pretty high that we backtrack. I think that’s the kind of outlook he’s going to give. It’s going to be full-throated.” September’s employment report, released Friday, was seen by some as a warning that the economy is not rebounding as expected. There were 661,000 jobs added in September, well below the 800,000 expected. Besides Powell, there are a half dozen other Fed speakers. There are also minutes from the Fed’s last minute released Wednesday afternoon.
This past week saw the following moves in the S&P:
We've all had versions of this conversation where you or the person you were talking to just couldn't make up their mind. At the end of the day, it only causes trouble and plans are ruined. The market is having its own back and forth this year trying to decide between growth and value. Just today, growth stocks are getting slaughtered while value stocks are up marginally. As an example, the Russell 1000 Growth index is down 1.8% on the day while the Russell 1000 Value index has managed to rally 0.25%. The chart below shows the daily performance spread between the Russell 1000 Growth index and the Russell 1000 Value index for each day in 2020. Today's performance spread between the two indices marks the ninth time this year that value has outperformed growth by more than two percentage points. At the other extreme, there have also been eight trading days where growth outperformed value by more than two percentage points.
So how does this year's frequency of days where the performance spread between the two indices was more than two percentage points stack up to other years? The chart below shows the daily performance spread between the two indices going all the way back to 1990. Over the last thirty years, the only two periods where we saw a frequency of these large daily dislocations was back in 2008 and the period spanning 2000 and 2001. In fact, with 17 days this year where the performance spread between the two indices was greater than two percentage points, the only other years that saw a higher frequency of large dislocations were 2000 (54) and 2001 (28). If you think the market has been indecisive this year, in 2000 we saw these types of daily dislocations an average of once per week.
Election Anxiety Weighs on October Market Performance
October often evokes fear on Wall Street as memories are stirred of crashes in 1929, 1987, the 554-point drop on October 27, 1997, back-to-back massacres in 1978 and 1979, Friday the 13th in 1989 and the 733-point drop on October 15, 2008. During the week ending October 10, 2008, Dow lost 1,874.19 points (18.2%), the worst weekly decline in our database going back to 1901, in percentage terms. March 2020 now holds the dubious honor of producing the worst, second and third worst DJIA weekly point declines. The term “Octoberphobia” has been used to describe the phenomenon of major market drops occurring during the month. Market calamities can become a self-fulfilling prophecy, so stay on the lookout and don’t get whipsawed if it happens. But October has become a turnaround month—a “bear killer” if you will. Twelve post-WWII bear markets have ended in October: 1946, 1957, 1960, 1962, 1966, 1974, 1987, 1990, 1998, 2001, 2002 and 2011 (S&P 500 declined 19.4%). However, eight were midterm bottoms. Over the last 21 years, October’s performance has been solid. Average gains over the last 21-years range from 1.3% by Russell 1000 to 2.4% by NASDAQ. Small caps have still struggled though with Russell 2000 gaining a modest 0.5%
Election-year Octobers rank dead last for Dow, S&P 500 (since 1952), NASDAQ (since 1972), Russell 1000, and Russell 2000 (since 1980). Eliminating gruesome 2008 from the calculation provides a moderate amount of relief, as rankings climb to mid pack. Should a meaningful decline materialize in October it is likely to be an excellent buying opportunity, especially for any depressed technology and small-cap shares.
What Have Democratic Sweeps Meant for the S&P 500?
Headed into the first presidential debate Tuesday night, betting markets (ElectionBettingOdds.com) placed Democratic candidate Joe Biden as the slight favorite to take the White House in November. The debate resulted in Biden gaining another 5 percentage point chance of winning the Presidency. As of this morning, Biden's odds to win are at 59.8% versus Trump's odds of 38.9%. Additionally, Democrats are slight favorites to win control of the Senate (58.4% to 41.5%) and big favorites to maintain the House (82.8% to 17.1%). Given these odds, in the chart below we show the average performance of the S&P 500 from the three months before Election Day through three months after Election Day for all election years post-WWII that resulted in a sweep of the executive and legislative branch by the Democrats. As shown, on average the S&P 500 has been on the decline in the weeks leading up to Election Day, though in the days just before the Election there has been a small rally that sharply reverses once the results come in. After the initial post-Election drop, the market has trended a bit higher, but by three months after the Election, it has only found itself around the same levels as Election Day; on average a 2.6% loss versus where the index stood three months prior.
The composite shown above is comprised of six different years: 1948, 1960, 1964, 1976, 1992, and 2008. While on average the S&P 500 has traded lower, it is not necessarily a sure-fire thing. For example, 1948 and 2008 were the only years that saw the S&P 500 trade and stay significantly lower in the wake of the election. In 1976, there was similarly a sell-off in the immediate aftermath of the election, but the index did make its way back up to the highs of that six-month time frame later on albeit no new high was put in place. Meanwhile, 1960, 1964, and 1992 all saw the S&P 500 run higher after the election even despite some periods of consolidation after initial moves higher. In our B.I.G. Tips report from Tuesday, we show these same charts for all Presidential election years post WWII including a look at the average performance given every potential election outcome.
Even after September's weakness, the S&P 500's trailing 12-month total return stood at an impressive 14.9%. Given the events of the last 12 months, one could even say that performance is remarkable. What's even crazier is that the S&P 500's performance over the last 12 months is more than three times stronger than the 12 month period before that (+4.25%). The chart below compares the S&P 500's annualized total returns over the last one, two, five, ten, and twenty years and compares that performance to the historical average return of the index over those same time periods. The S&P 500's historical average 12-month return is 11.7%, so the current 14.9% gain exceeds that average by more than three full percentage points. Over a two-year window, though, the S&P 500's annualized return of 9.4% is more than a full percentage point below the historical average. Looking further out, the S&P 500's trailing five and ten-year annualized return has been much stronger than average, which makes sense given the long bull market we were in. Over a 20 year window, though, the S&P 500 is only just starting to work off some of the declines from the dot-com bust and as a result, the 6.4% annualized gain is a four and a half percentage points below the long-term average of 10.9%.
Below we show how the current performance of the S&P 500 in each of the time frames shown compares to all other periods on a percentile basis. The S&P 500's performance over the last year, ranks just below 56th percentile of all other periods, while the two-year performance ranks just below the 42nd percentile. Even as the five and ten-year periods have seen well above average returns, they still rank in just the mid-60s on a percentile basis. The S&P 500's ranking over a 20-year time period is a completely different story ranking in single-digits on a percentile basis. Even with the equity market right near record highs, the last two decades have been forgettable for US equities.
There is no denying that market seasonality has not worked so well this year. But we have been here before and history is on our side. Over the long term, intermediate term and short term market seasonality has suffered brief periods when seasonality was overridden by more powerful forces. The COVID pandemic and economic shutdown certainly qualifies. But it is only a matter of time until repetitive human behavior patterns and people and institutions return to moving money around in the usual daily, weekly, monthly, quarterly and seasonal patterns. The return of perennial September weakness is emblematic of a return to normal market behavior and a reflection of the fact that despite the continuing concerns about surges in coronavirus cases life is beginning to return to normal. In our area, about 25-30 miles north of New York City, our kids are beginning hybrid learning, playing rugby, lacrosse and other sports (yes with some COVID protocols, but tackling and facing-off), golf outings are happening and people are going to restaurants and out and about. The chart here shows the historical One-Year Pattern of the S&P 500 Since 1950 versus 2020. The black line shows the seasonal pattern since 1950. The blue represents the pattern since 1988. We use 1988 as it is the first year after the 1987 Crash when the market underwent a major systemic change with the implementation of downside protection circuit breakers and collars. It is noteworthy how the seasonal pattern persists during both the 70-year and 31-year timeframes. 2020 is plotted on the right axis due to the magnitude of the move this year. The yellow box highlights the rebirth of seasonality this September, especially during this notoriously negative Week After Triple Witching Week as detailed page 108 of the 2020 Almanac, indicated by the two black arrows Years like 1980, 1982, 2009 and 2016 with unseasonably early weakness and bear markets like 2020 returned to normal seasonal patterns in short order. And years like 1954, 1958, 1980, 1982, 1995 and 2009 that exhibited double-digit gains in the Worst Six Months still proceeded to deliver further sizable gains in the subsequent Best Six Months (page 52, STA 2020). We believe the return of market seasonality is upon us. So remain cautious through the end of September and be alert to Octoberophobia, but remain ready to pounce on our Best Months Seasonal MACD Buy Signal, when it triggers.
Below are some of the notable companies coming out with earnings releases this upcoming trading week ahead which includes the date/time of release & consensus estimates courtesy of Earnings Whispers:
Monday 10.5.20 Before Market Open:
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Monday 10.5.20 After Market Close:
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([CLICK HERE FOR THURSDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES!]())
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Friday 10.9.20 Before Market Open:
([CLICK HERE FOR FRIDAY'S PRE-MARKET EARNINGS TIME & ESTIMATES!]())
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Friday 10.9.20 After Market Close:
([CLICK HERE FOR FRIDAY'S AFTER-MARKET EARNINGS TIME & ESTIMATES!]())
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Domino's Pizza, Inc. $433.78
Domino's Pizza, Inc. (DPZ) is confirmed to report earnings at approximately 7:30 AM ET on Thursday, October 8, 2020. The consensus earnings estimate is $2.73 per share on revenue of $944.53 million and the Earnings Whisper ® number is $2.83 per share. Investor sentiment going into the company's earnings release has 76% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 33.17% with revenue increasing by 15.07%. Short interest has decreased by 31.5% since the company's last earnings release while the stock has drifted higher by 7.4% from its open following the earnings release to be 22.3% above its 200 day moving average of $354.71. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 7.3% move on earnings and the stock has averaged a 8.2% move in recent quarters.
Paychex, Inc. (PAYX) is confirmed to report earnings at approximately 8:30 AM ET on Tuesday, October 6, 2020. The consensus earnings estimate is $0.56 per share on revenue of $895.39 million and the Earnings Whisper ® number is $0.57 per share. Investor sentiment going into the company's earnings release has 49% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 21.13% with revenue decreasing by 9.74%. Short interest has decreased by 9.7% since the company's last earnings release while the stock has drifted higher by 2.8% from its open following the earnings release to be 6.0% above its 200 day moving average of $74.91. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, September 18, 2020 there was some notable buying of 1,269 contracts of the $90.00 call expiring on Friday, March 19, 2021. Option traders are pricing in a 4.8% move on earnings and the stock has averaged a 2.1% move in recent quarters.
RPM International Inc. (RPM) is confirmed to report earnings at approximately 6:45 AM ET on Wednesday, October 7, 2020. The consensus earnings estimate is $1.21 per share on revenue of $1.49 billion and the Earnings Whisper ® number is $1.26 per share. Investor sentiment going into the company's earnings release has 65% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 27.37% with revenue increasing by 1.17%. Short interest has decreased by 39.7% since the company's last earnings release while the stock has drifted higher by 3.3% from its open following the earnings release to be 12.4% above its 200 day moving average of $73.51. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 4.4% move on earnings and the stock has averaged a 2.3% move in recent quarters.
Helen of Troy Ltd. (HELE) is confirmed to report earnings at approximately 6:30 AM ET on Thursday, October 8, 2020. The consensus earnings estimate is $2.39 per share on revenue of $451.26 million and the Earnings Whisper ® number is $2.57 per share. Investor sentiment going into the company's earnings release has 62% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 18.91% with revenue increasing by 9.00%. Short interest has decreased by 6.4% since the company's last earnings release while the stock has drifted lower by 4.4% from its open following the earnings release to be 12.8% above its 200 day moving average of $177.13. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 5.7% move on earnings and the stock has averaged a 8.9% move in recent quarters.
Acuity Brands, Inc. (AYI) is confirmed to report earnings at approximately 8:40 AM ET on Thursday, October 8, 2020. The consensus earnings estimate is $2.01 per share on revenue of $814.63 million and the Earnings Whisper ® number is $2.12 per share. Investor sentiment going into the company's earnings release has 46% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 28.21% with revenue decreasing by 13.16%. Short interest has increased by 62.6% since the company's last earnings release while the stock has drifted higher by 5.6% from its open following the earnings release to be 4.1% above its 200 day moving average of $101.43. Overall earnings estimates have been revised higher since the company's last earnings release. Option traders are pricing in a 5.8% move on earnings and the stock has averaged a 9.0% move in recent quarters.
Levi Strauss & Co. (LEVI) is confirmed to report earnings at approximately 4:00 PM ET on Tuesday, October 6, 2020. The consensus estimate is for a loss of $0.27 per share on revenue of $766.84 million and the Earnings Whisper ® number is ($0.20) per share. Investor sentiment going into the company's earnings release has 40% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 187.10% with revenue decreasing by 47.01%. Short interest has increased by 3.9% since the company's last earnings release while the stock has drifted higher by 7.3% from its open following the earnings release to be 3.5% below its 200 day moving average of $14.66. Overall earnings estimates have been revised higher since the company's last earnings release. On Friday, October 2, 2020 there was some notable buying of 8,166 contracts of the $14.00 call expiring on Friday, October 16, 2020. Option traders are pricing in a 10.6% move on earnings and the stock has averaged a 6.9% move in recent quarters.
Lamb Weston Holdings, Inc. (LW) is confirmed to report earnings at approximately 8:30 AM ET on Wednesday, October 7, 2020. The consensus earnings estimate is $0.30 per share on revenue of $877.60 million and the Earnings Whisper ® number is $0.28 per share. Investor sentiment going into the company's earnings release has 36% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 62.03% with revenue decreasing by 11.26%. Short interest has decreased by 21.7% since the company's last earnings release while the stock has drifted higher by 4.1% from its open following the earnings release to be 1.8% below its 200 day moving average of $69.17. Overall earnings estimates have been revised lower since the company's last earnings release. On Friday, October 2, 2020 there was some notable buying of 1,580 contracts of the $70.00 call expiring on Friday, October 16, 2020. Option traders are pricing in a 8.3% move on earnings and the stock has averaged a 6.7% move in recent quarters.
Landec Corp. (LNDC) is confirmed to report earnings at approximately 4:20 PM ET on Tuesday, October 6, 2020. The consensus estimate is for a loss of $0.11 per share on revenue of $127.86 million and the Earnings Whisper ® number is ($0.09) per share. Investor sentiment going into the company's earnings release has 41% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 31.25% with revenue decreasing by 7.82%. Short interest has decreased by 5.1% since the company's last earnings release while the stock has drifted lower by 12.3% from its open following the earnings release to be 8.4% below its 200 day moving average of $10.30. Overall earnings estimates have been revised lower since the company's last earnings release. Option traders are pricing in a 16.7% move on earnings and the stock has averaged a 10.6% move in recent quarters.
Saratoga Investment Corp (SAR) is confirmed to report earnings at approximately 4:00 PM ET on Wednesday, October 7, 2020. The consensus earnings estimate is $0.47 per share on revenue of $12.95 million. Investor sentiment going into the company's earnings release has 48% expecting an earnings beat. Consensus estimates are for earnings to decline year-over-year by 30.88% with revenue decreasing by 6.75%. Short interest has decreased by 60.5% since the company's last earnings release while the stock has drifted higher by 6.3% from its open following the earnings release. Overall earnings estimates have been revised lower since the company's last earnings release.
EXFO Inc. (EXFO) is confirmed to report earnings at approximately 4:00 PM ET on Wednesday, October 7, 2020. The consensus earnings estimate is $0.07 per share on revenue of $64.85 million and the Earnings Whisper ® number is $0.07 per share. Investor sentiment going into the company's earnings release has 30% expecting an earnings beat. Consensus estimates are for year-over-year earnings growth of 40.00% with revenue decreasing by 7.59%. Short interest has decreased by 17.5% since the company's last earnings release while the stock has drifted lower by 14.7% from its open following the earnings release. Overall earnings estimates have been revised higher since the company's last earnings release.
The unpopular opinion on the Apache or "The game was rigged from the start".
So, obviously, I will be downvoted to hell, but whatever. This is the thread about expectations and reality. I have made a simple image containing clues to the fact that SnowRunner was going to have some other paid DLC outside the Season Pass. There were some dead giveaways on the chosen business model right from the start. The key point of this post is not to defend the Apache, but steer the discussion towards the real SnowRunner problem: the lack of communication from the devs. The info on this picture shows some very clever wording to avoid spoiling the additional paid content, intentionally or unintentionally. So, let me spill out some facts:
Each DLC has it's own product page at every possible online store: skins, packs and phases are separated and fully rigged to be a separate purchase. There is absolutely no reason to do so if you're intending to provide all content with the Season Pass (referred as SP from now on). High Roll, Loaded Dice, Scorched and True Colors packs could have been bundled as "Season Pass Bonus Pack" or something like that, but instead of that, they are available to purchase on the pack-to-pack basis. While Phase 1 content is clearly bundled together in one product: there is no need to separately activate Lake Kovd, Imandra, three new cars and new skins. Which brings us to...
The descriptions of the SP in store and the answer in FAQ points us to the fact that we will be getting 4 Phases of new content, including new trucks, etc or, more specifically, SP will include all it's post-launch content: the post-launch content of a Year 1 Season, advertised in the trailer, not the game entirely, that's the point of the chosen wording. This wording can potentially lead to the second SP with Phases 5-8 or more paid DLC outside the SP. When I first saw this info, I have immediately thought that, if the game will sell good enough, it will be updated for PS5/Series X and will receive the second year of content, because it seems logical enough. Released at April, 28, the end of the first SP content distribution will be somewhere around April, 2021, almost six months after the release of the new consoles, it's what makes it logical to upgrade the SnowRunner for the new hardware (read as "bump the graphics up to the PC counterpart and sell another $24,99 Season Pass for an already finished and polished game with the established playerbase") and then prepare to release the next game in the series somewhere around 2022. Overall, the SnowRunner was a success.
The team may have made an error showcasing the Apache and other new vehicles in the trailers, but that can be a result of them trying to deal with the datamine issue and show some work in-progress. On the other hand, in the beginning of a trailer where the Apache interior was shown, it was stated the following: "I'm here to give you the look at today's first batch of content that's part of a SnowRunner's Season Pass. We'll also take a sneak peek of some of the freeand paidcontent for the rest of the Summer" which is a clear indication of the three existing models of DLC distribution. Namely, SP content, free content and paid content.
The trailer in question is labeled as "Season One: The Overview Trailer" and not as "Phase One: The Overview Trailer". Let's check how the other popular games are handling their seasons: it's usually a Season Pass/Battle Pass, some additional paid content such as skin packs or weapon packs and some free changes for everyone such as new modes or new ways to play. It's logical to assume that Season One consists from the Phase 1 content bundle (two new maps, three new trucks, new skins, new add-on), free content for everyone (interior customization, trials) and additional paid content. It is also quite logical to note that SP marketing has been especially focused on Phases rather than Seasons, so a Phase can be the definition of a content pack, and a Season covers all release plans for a specific release period.
So, the community have expected the new content will be free for all SP owners (because nothing was said on that matter) while the devs were trying to navigate around the issue that there will be more paid content in the future, which won't be covered by the SP. I can see three main reasons for that: English may not be the native language for community managers, the developers falling behind the schedule due to COVID-19 and buggy launch or developers or the publisher being not entirely sure about their upcoming business model. Reasons can pretty much be combined or more complex.
The business model can be changed on the fly, the most notable example being the addition of the microtransactions to the GT Sport, despite the devs have said otherwise. It's also common to have some small pieces of content released outside the SP (check the Cities Skylines for the most amount of content released outside the two Season Passes). Not a big deal, really, because business can change in a brink of an eye (no one could have imaged ZeniMax being bought by Microsoft following the small sales of Doom Eternal, Wolfenstein 2 and F76 launch failure). The investors and the parent company doesn't need unprofitable assets in their possession. Focus is also known for changing the business model on the fly with the example of World War Z, which has received the Season Pass after the sales have met the expectations and the content released prior to the SP was not included in it.
The devs certainly don't see a small DLC as a microtransaction, judging from their positioning of the mobile MudRunner port. They do see a $5 expansion as a DLC, not as a microtransaction, thus making a FAQ answer about the absence of possible microtransactions a valid point of view. Because, you know, most people see microtransactions as credits packs or a shortcut to the something that can be unlocked in-game, but not as a built-up from the ground vehicle model, not available otherwise.
Nintendo's missing franchises and their chances of coming to Switch (long read)
“I want X for Switch”, “when is X coming to the Switch”, “X is perfect for the Switch!” How often have you heard or said these sentences? Quite a lot, probably, especially about Nintendo franchises. Nintendo fans really like first-party games, and they’re always asking for their favorites to come back. Problem is, even though Nintendo owns dozens of franchises, there’s only a few that are guaranteed to show up during any given console, so fans of smaller franchises are left wondering when they’ll play them again. Well, today I’ll try to mostly answer these questions. I’ll take a look at several, Nintendo-owned franchises and try to figure out what are their chances of coming to Switch. I’ll be basing myself on this such as release schedule, success of previous entries, popular demand, market niche and internal interest at Nintendo. However, keep in mind two things. One: Nintendo owns a shit-ton of IPs, and I won’t cover them all. I’ll focus on the ones that have multiple entries, and even then, I might skip a few if I feel I have no meaningful insight. And two: No matter what I or anyone else says, the chances for any of these games to come back is NOT ZERO. Nintendo is unpredictable and they’ll sometimes bring something out of the blue when you least expect it. This year alone we saw the return of Brain Age (a franchise not seen since 2012), Clubhouse Games (a sequel to a game from 2005), and Famicom Detective Club, a franchise with two games from 1988/89, which then received a remake in 1998 and then nothing until twenty two years later. Granted, it’s another remake, but it is still a modern installment in a franchise twenty two years dormant. If Famicom Detective Club can come back in 2020, so can your favorite franchise. Now, let’s begin, in alphabetical order: Art Academy Starting off with a small one. Art Academy is a series of drawing games that started on the DS in 2010 and then released pretty consistently over the following years, with three entries on 3DS and two (well, one and a half) for the WiiU between 2010 and 2016. Already this feels like a franchise with a pretty consistent release schedule, even though it hasn’t been seen for four years now. I don’t think any of the games were blockbusters, per se, but they also don’t need to be. They’re small games, probably inexpensive to produce that seem to do consistently well enough to get new sequels. There are several obstacles that present themselves to the release of a new Art Academy, but I think all of them are easily overcome. For starters, AA is the type of casual game that thrived during the DS/Wii eras, a Touch Generations game. Since the Switch released, many have noted that Nintendo may want to distance themselves from that era due to the failure of the WiiU, and there may be some truth to that, but I feel like this is starting to change. Again, this year saw the return of both Brain Age and Clubhouse Games, both casual, Touch Generations DS games. I feel like, at the start of the Switch’s life cycle, Nintendo was indeed trying to focus on core gamers, but now that they have secured that core gamer audience, they may be more comfortable releasing more casual fare. Furthermore Art Academy is developed by Headstrong Games, a British developer that doesn’t seem to do much other than AA. However, in 2017, that team was absorbed into its parent studio, Kuju Games. This move, which happened the year after the last AA game released, may have something to do with the franchsie’s MIA status. But, Kuju games is still active, having released a game just last year, and I don’t see why they couldn’t take up the mantle. Finally, some speculated a few years ago that AA was dead due to the Switch not having a stylus but, OH WAIT, Brain Age fixed that too! All in all, even though Art Academy is hardly a hot franchise, there’s very little standing in the way of its return, and little reason to doubt that it will. Chances: Good Chibi-Robo! We may have started on a positive note, but here comes a downer. Chibi-Robo is probably not coming back anytime soon. This cute little robot debuted in his self-titled Game Cube game, developed by Skip Ltd. Like most games by the developer, it was quirky and fun, and not very popular, but had its fans, and Chibi-Robo must have endeared someone at Nintendo, because he kept showing up here and there. He got two DS sequels, though the second one was Japan-only, already a red flag. In 2013, he starred in a 3DS eshop game that was very different from the main games, more of an experimental spin-off, and was not well-received. But the real final nail came in 2015, with Chibi-Robo Zip Lash! The game was announced to be a 2D platformer, and many fans identified the change in genre (from a unique adventure game to one of the most over-saturated genres in Nintendo consoles) as a total sell-out, and they were totally correct! The developers basically admitted that they did it to try and get more players (red flag). Series producer Kensuke Tanabe then said that if the game didn’t sell well, it could be the end of the franchise (RED FLAG). And then, the unfortunate but inevitable happened. Zip Lash was a critical and commercial bomb, and neither the developer nor the franchise has been seen again. Aside from the inevitable Smash Bros mentions, Chibi-Robo has only been seen on that infamous flaming tweet from 2018 (I told you someone at Nintendo really likes them). To make matters worse, there are increasing signs that Skip Ltd may be going under So, a struggling franchise makes a desperate move to gain fans, a developer expresses concerns for its future if the game bombs, said game bombs and now the developer may be going out of business? It seems the writing is on the wall. Now, even if Skip goes under, that is not necessarily the end of Chibi. Nintendo would still retain the rights, as they did for Trace Memory and Hotel Dusk after developer Cing went under. As for whether or not Nintendo would want to give the franchise a second (third? Fourth?) chance, it doesn’t look good Chances: Very bad Custom Robo From one diminutive robot to another, the Custom Robo series is and robo-battle series that began on the N64. It was Japan only, as was its N64 and GBA sequels. Afterwards, Nintendo did try to expand it, releasing a GameCube game in NA, and a DS game in NA and Europe. However, despite the fact that players of these games will attest to how good these games are, they didn’t seem to do very well, and the franchise has not been seen since 2007. There was one statement of internal interest, when a developer in 2014 said that he heard demands both inside and outside the company for a new entry, but that there were no plans for one, and he was unsure when there would be. Six years on, it seems there still aren’t. In fact, the developer itself, Noise, is also strangely MIA. Though they are officially still active, with their website being updated for 2020, they have not worked on a game since 2015. Then, in 2018, many fans watched in horror the news that Nintendo let the trademark expire. Some have pointed out that this isn’t as bad as it seems, as it refers specifically to games on optical discs, which Nintendo doesn’t make anymore, but I don’t know enough about the subject to say for certain. Regardless, it’s evident that Nintendo still owns the franchise, as Custom Robo content appears in Smash Ultimate. On the other hand, one of the series creators, Kohji Kendoh, is still thinking about it. He is working for another developer, and released a suspiciously similar game called Synaptic Drive just this year, as well as talking about Custom Robo in social media. It seems like a Mighty no9/ Yooka-Laylee/Bloodstained situation, in which the owner of an Ip is not using it, so the creator releases a spiritual successor. Bottom line, there seems to be demand for Custom Robo. A developer saw it six years ago, and the creator is seeing it now. Whether or not thinks this demand is enough to revive the franchise, is tough to say, but doesn’t look great. Not as bad as Chibi-Robo, though Chances: Bad Daigasso! Band Brothers Here’s a franchise Americans never got. Daigasso! Band Brother is a rhythm game released for the DS in 2004 and stars Barbara the Bat, who has an uncharacteristically risqué design for Nintendo. The game was Japan-only but seems to have been successful, it received a sequel in 2009 (released in Europe, but not NA), and another in 2013 for the 3DS. Despite not having received new games since then, the series is far from inactive. Barbara the Bat in particular, like Chibi-Robo, seems to have fans inside Nintendo because she pops up everywhere. She had cameos in a few other DS games, she was an AT in Brawl and a spirit in Ultimate, she was a costume in Mario Maker, she appeared in a comic strip with WarioWare’s Ashley, and the series has a Twitter account that was super active all the way up to April of this year (more on that later). In 2017, that account even tweeted a comic strip of Barbara demanding a Switch. That was probably not a tease of anything, as it’s been 3 years and nothing, but stuff has happened with the franchise even more recently. Last year, in 2019, six years after the release of the 3DS game, there were 30 songs added to the game in celebration of the series 15th anniversary. So as late as last year, Nintendo was celebrating this franchise with an in-game event. Now, the servers for the game were shut down earlier this year (hence the end of the Twitter account), and the game was removed from the eshop (as it is basically pointless without the servers), but with recent news that the 3DS has ceased production, it’s pretty clear that the game’s end is a consequence of the 3DS’ end, and not a lack of players. So if the series is alive, but can’t be on the 3DS, it has to go somewhere, no? Bottom line: the games are successful, the series is active, and the character is popular. I don’t know if Barbara the Bat’s next tour will be an international one, but I’m confident it will happen Chances: Very Good Dillon’s Rolling Western DRW is a unique western-themed tower defense game released on the 3DS eshop in 2012. It received mixed reviews, but had a dedicated fanbase, and was successful enough to spawn two sequels, one in 2013, and a post-apocalyptic themed one in 2018. With a game having released just two years ago, its reasonable to say the series is not dormant, so the prospect of a new game is always likely. The developer, Vanpool, who mostly works on smaller scale stuff like this, is both still active and still working at Nintendo. So, really the only reason to believe the series wouldn’t continue would be if the latest game bombed really hard. It’s hard to say that it did, as sales figures are unavailable, but it was a 3DS game in 2018, probably didn’t set the charts on fire. But then again, unless Nintendo had some really unrealistically high expectations, I don’t think it could have bombed hard enough to kill the franchise that fast. There’s not much more to say. There aren’t any rumblings of a return, but also no reason to be pessimistic. Chance: Above Average Earthbound Let’s make one thing perfectly clear: There will not be a Mother 4 The Creator of the series, Shigesato Itoi, has said that he would not work on a fourth installment, as he feels the story is complete. Now, normally, Nintendo could just say “screw creative integrity, let’s make a fourth game anyway!” but Shigesato Itoi directly co-owns the series’ copyright so they actually can’t. So unless Itoi changes his mind, or he dies and Nintendo decides to ignore his wishes (neither scenario is completely outside the realm of possibility), Mother 4 is not happening. So, if new Mother content is made, it’d be either a remake, or Mother 3 localization. We all know demand for this last one is overwhelming, Nintendo themselves have acknowledged it multiple times, but it still hasn’t happened, and it doesn’t seem things have changed. A remake is possible, but don’t hold your breath for it. Despite the series’ popularity, I think all we’ll see of it is the first two games in NSO. Chances: Bad Excitebike This is a hard one to pinpoint. Excitebike is one of those classic NES games that Nintendo likes to reference all the time, like Ice Climber, Balloon Fight, Wrecking Crew and Duck Hunt. Unlike those, Excitebike actually received sequels and established a franchised. There was a great entry on the N64 and three entries on the Wii, but nothing more since. I can’t imagine the Wii entries were super successful, and there really hasn’t been any word from Nintendo about any interest in reviving the series, either from developers, or the fans. The developer of the Wii games, Monster Games, is still active, and still makes racing games and extreme sports games, but hasn’t worked with Nintendo in 5 years. Now, one point I see often, and that I’d like to address, is the idea that Nintendo doesn’t want multiple games from the same genre on the same console. I can’t agree. With the exception of the WiiU, every Nintendo home console since the SNES has had multiple Nintendo-published racing games released for it. WiiU didn’t but that console is an exception to many norms. I don’t see why Mario Kart, behemoth that it is, would stop any other racing game from being made, especially when they are so very different (although the fact that MK8 has an Excitebike track doesn’t inspire confidence). No, I don’t think Mario Kart is the problem, I think is just lack of interest. And though Excitebike is not a franchise Nintendo will ever truly forget, it’s not really revving up for a comeback either. It could happen, it could not Chances: Medium Fatal Frame This horror franchise wasn’t originally a Nintendo product, being released on the PS2 by Tecmo. However, since the fourth game, each title in the series has been published and copyrighted by Nintendo, and this seemingly applies to all future entries, as the series producer said the series’ future is up to Nintendo. So, how does that future look like? Well, the last game in the series, Maiden of Black Water, was a WiiU game, which means it didn’t sell well, but not as badly as you might think. From all I could find, which is admittedly not much, sales for the game seemed to be only slightly less than previous entries, a gap more than explainable by its console. So, if the series was getting sequels before, the WiiU game’s sales wouldn’t be the reason why there wouldn’t be more. And though Nintendo of America has had to take baby steps into accepting the franchise overseas, Nintendo of Japan seemed satisfied with it, releasing four games between 2008 and 2014. So sales aren’t an evident problem, what about the developer? That developer is Tecmo Koei, who is not only active and buddies with Nintendo, their current project is none other than Nintendo’s big holiday title. There’s obvious trust there. As for interest, there is a lot. From Koei Tecmo calling it a valuable IP, to the series producer stating multiple times, including this year, that he’d like to bring it to the Switch Now, this comment pretty much confirms that a new Fatal Frame is not in development as of now, but it has a chance of happening. And remember, the last game is on WiiU, and if we know anything about those, is that they like to come to Switch. And though I don’t see Nintendo breaking their necks to make a new entry, I don’t think they’d oppose it if Tecmo pitches it to them, especially if it’s just a port. Chances: Good Fossil Fighters This game is not Pokémon, or so its fans tell me. Fossil Fighters is a DS game from 2008 where you collect various species of dinosaur and battle with other ~Dinosaur Trainers~ Fossil Fighters in RPG battles. It didn’t receive great reviews, but was successful enough to get a sequel two years later, and another one on the 3DS in 2014. Three games in six years is a pretty good release schedule, and things were looking alright, until that 3DS game came. It was primarily developed by a different studio, and it showed. The game received abysmal reviews, and fan reception was similar. Sales weren’t awful, but not great either. Since then, the series has been completely quiet. The developer, Red Entertainment, is still active, but hasn’t worked with Nintendo since the 3DS game. As for interest, there hasn’t been a peep from Nintendo about this series at all. No interviews describing vague interest in bringing it bad, no acknowledgment of fan demand, no cameos in other games (aside from Smash, which doesn’t count, Smash has everything). Even fan demand doesn’t seem too high, most of what I’ve seen is a Change.org petition which has been up for a year and has not reached its 2500 signatures goal. It looks like this series could become a fossil itself. Someday some might dig it up and revive it to use in battle, but I’m not feeling it. Still not as bad as Chibi-Robo Chances: Bad F-Zero This is the reason you’re reading this. Oh, F-Zero. If fan demand alone was the deciding factor, F-Zero would be top priority. People want F-Zero, people beg for F-zero, people who have never played, beg for F-Zero. And Nintendo knows this, they’ve acknowledged it. They themselves haven’t forgotten it. Even putting Smash aside, there was an F-Zero minigame in Nintendo Land. There are F-Zero tracks in Mario Kart. They’ve done everything but make a new F-Zero game, but why the hell not? Well, it’s important to understand that the F-Zero series declined in sales throughout its life. The best-selling game is still the first, and though the following games were fantastic, they sold less and less, and yet, strangely enough, between 2003-2004, Nintendo released THREE F-Zero games. Around the same time, they also released an anime. There are several great articles and videos about what happened to F-Zero, but the best point I’ve seen is that Nintendo tried, in 2003, to really push F-Zero, but it didn’t work. So, with their attempt failed, they let the series sleep, and just never woke it up, even as fan demand increased. In 2015, Miyamoto commented on the series, and said that, though he heard the demand, he was unsure on what to do with the series, on how to make a new game. Many fans scoffed and said he’d just need to make a modern F-Zero and that’d be great, but I think internal concern runs deeper. Just doing F-Zero failed in 2003, so why would it work now? That said, I think there is hope. Fan demand is powerful, and more and more we see a new generation of Nintendo developers pushing the company forward. These younger developers are the ones behind new IP like Splatoon and ARMS, and great reinventions of existing ones like Odyssey and BotW. It’s possible that these same younger developers could hear the fan demand, and want to take on the series without the hesitation of their older peers. It’s been 16 years, but Kid Icarus was gone for 19, wasn’t it? Stranger things have happened Chances: I want to believe Golden Sun And here’s the other one. Few Nintendo fans are as vocal and dedicated to their dormant franchise as Golden Sun games. For those who don’t know, Golden Sun was a couple of excellent GBA RPGs released in 2001 and 2002, with a DS sequel in 2010. Such erratic release schedule would make predicting the series’ future difficult at the best of times, but the DS game was seen as a disappointment by many fans and sales were unimpressive. With ten years having passed with no new game, is the series done for? Well, let’s look at it. In 2012, one of the developers gave an interview in which he straight up said that, if there was fan demand for it, there would “naturally” be a fourth game. We know that developer interview doesn’t immediately guarantee a sequel, but this is also a much more positive statement than Custom Robo and F-Zero’s “We know there’s demand, but we don’t know what to do with it”. This is “If there’s demand, it will happen.” So, is there demand? You bet your ass there is. And it feels like it is growing. There was a high-profile hoax about a fourth game in 2017 (a similar hoax happened some time before the third game, by the way). The series received notably more content in Smash Ultimate than series of similar standing (quite possibly an acknowledgment of its popularity). And last year, Cory Balrog, director of 2018’s GOTY God of War, tweeted about all the franchises he would trade for a new Golden Sun. Nintendo could hardly have asked for a higher profile endorsement within the industry. So if fan demand is there, why hasn’t it happened yet? Well, it helps to look at the development history of the series. The first game took eighteen months to develop, considered a long time for a handheld game at the time. And though the eight years between the GBA and DS games may have you believe it took a long time to greenlight a sequel, that’s not the case. Signs point to internal discussion about a sequel to the GBA games as early as 2002, with developers quoted as saying that Nintendo was asking them to make a new one. One of the series producers also said that the series takes a long time to make because of its complexity. After the DS game failed to meet expectations, its understandable that Nintendo may not have been as enthusiastic for a new game as it was before, but it seems like, even if the series is alive and well, the long hiatus would not be uncharacteristic. In that same interview quoted before, the developer even said that a new game would take a long time. In fact, if GS4 had started development shortly after that interview, if it took as long as Dark Dawn, the game would be wrapping up production around now. Then there’s the developer, Camelot. Aside from Golden Sun, they pretty much only make Mario Tennis and Mario Golf. They release schedule is also super consistent, with a new game every other year, sometimes every year. We already got a Mario Tennis on Switch two years ago so, if not for COVID, their new game would probably have released this year. All things point, then, for the next Camelot game to hit the Switch next year. Smart money would be in Mario Golf, but maybe it is finally Golden Sun. Finally, I don’t think, as others do, that Xenoblade is the reason GS is not happening. Again, I don’t see evidence to support the idea that Nintendo doesn’t want to publish more than one game in the same genre. Both the GBA and DS had more than a dozen Nintendo-published RPGs, and the Wii and 3DS got RPGs even after Xenoblade released for them. I don’t see why Xenoblade would stop a Switch Golden Sun, especially when they are very different kinds of RPGs. GS is actually closer to Octopath Traveler, whose success was enough to impress SE, why wouldn’t Nintendo want a piece? Really, I think the biggest obstacle is that Nintendo might want to prioritize the safe investment of Mario sports games over Golden Sun, but the more I research, the more I feel like GS’s chances are higher now than they were at any point in the last ten years. I feel there’s hope this sun will rise again Chances: Above average Kid Icarus Sorry to keep you waiting. Kid Icarus was an OK NES game that had a forgotten Game Boy sequel and then nobody cared about it for 19 years until it was unexpectedly revived for the 3DS in 2012. This story is a testament to the fact that, just because its been a long time, it doesn’t mean it will never happen. But in order to know if it will happen again, let’s understand how it happened in the first place. It’s important to mention that reviving Kid Icarus was not the intent behind KI: Uprising, it was the idea of its director, Masahiro Sakurai. Nintendo had given him a project and Sakurai decided to use an established franchise for it. He briefly considered Star Fox, but decided to use Kid Icarus, for which he probably had a soft spot, considering he had added Pit to Brawl some years earlier. So, there wasn’t an exec at Nintendo who woke up one day and decided to bring Kid Icarus back, they gave the director a project, and, after some deliberation, he decided to use Kid Icarus for it. That director is currently busy developing Smash Bros DLC, but even after that’s over, he probably won’t revisit Kid Icarus. He has shot down the idea of him working on a sequel or a port. His words were: "For now, my thought is that perhaps we'll see someone else besides me make another Kid Icarus in another 25 years." Yikes. That’s pretty damning. Sure, Nintendo could get someone else to make the game, but if it was only Sakurai that was interested in the series in the first place, what is the hope of that? Well, that statement is not super accurate. Before Uprising, there was actually a Kid Icarus reboot in development for the Wii. It was cancelled, and thank God for it, as it was an awfully stupid gritty reboot, but it showed that there was interest in the franchise even before Uprising. Naturally, you’d expect interest to be bigger now than before. The fact that Uprising not only grew the series’ fanbase, but the that there are Kid Icarus characters in Smash Bros, means that the franchise has a permanent place in the interest in Nintendo fans. Smash in particular means that there are 18 million people who know Pit and Palutena and would turn their heads if a new game was announced. Furthermore, Nintendo’s new CEO is interested in bringing 3DS franchises to the Switch after the success of the Switch Lite, especially now that the 3DS is officially dead, so the opening is there for it. There is definitely demand for a new Kid Icarus game, but it is too sporadic a franchise to be certain, and if it were to happen, Nintendo would have to find someone new to do it. But, in the end, the series is definitely in a better place now than it was 10 years ago. Chances: Medium Legendary Starfy Legendary Starfy was a 2D platformer for the GBA that was apparently really successful, as it received four sequels in the span of five years. Not only that but, like Barbara and Chibi-Robo, Starfy himself was quite popular. He had cameos in Mario & Luigi and Super Princess Peach, music of the series was in Donkey Konga, he is a regular Assist Trophy in Smash and was a costume in Mario Maker. Though the series took until the last game to come to the West, there were plans to bring the first four games too, as well as consideration for expanding the series to the Wii. The series was widely advertised, with animated commercials and tons of merchandise, including plush dolls, CDs, pencils, birthday balloons, casino cards and two manga series. When asked if there were plans for a sixth game, the developer answered “Yes!”, no ifs, not buts, straight-up Yes. And then… nothing. The series just stopped. And the reason why is: I have no idea. Maybe if the last game bombed spectacularly, but it doesn’t seem to be the case. Sure, Japanese sales declined with each entry, but not by that much. Maybe NA sales weren’t what Nintendo was hoping for, but surely not enough to kill such a steady franchise. The confusion only grows when we look at its developer, Tose. Now, this is interesting. You’ve probably played a Tose game without knowing. They have worked on over A THOUSAND GAMES, but they never receive credit. They merely assist with development in the shadows. As one exec puts it: "Our policy is not to have a vision. Instead, we follow our customers' visions. Most of the time we refuse to put our name on the games, not even staff names." They are a ghost developer. Even its Wikipedia page admits that the list of games on it is purely speculative. There are probably hundreds more, that we don’t know about. The only exception is the Starfy series. That series was their vision. So why did they stop? Could they have decided that it was against their vision to make a game of their vision? We can only speculate. The fact that the series’ end was so unexpected, and its developer so mysterious, means that any speculation about it is a shot in the dark. All I can say is that there’s no particular reason to expect it. Chances: Not Good Nintendogs Here’s a big one. Nintendogs was one of the biggest successes of the casual era, on par with Brain Age and Wii Fit, but unlike those, it remained a multi-million seller during the 3DS/WiiU generation. And though Nintendo may have tried, at first, to distance the Switch from that era, the return of Brain Age and Clubhouse Games indicates that other casual games would follow, and Nintendogs would be a no-brainer. There is, however, one big problem: the Switch does not have a microphone. While Brain Age on the DS also used the microphone a lot, it was not essential to it. You could easily make Brain Age without it. But not Nintendogs. Issuing voice commands to your virtual pup is integral to the experience. No microphone means no Nintendogs. But with that said, Nintendo did go to the trouble of making a Switch stylus, seemingly just for Brain Age, so maybe they could make a microphone peripheral. Sure, a microphone would be more complex to make than a stylus, but not inconceivable. They did something like that with the Wii Speak. I’m sure for that nintendogs money, Nintendo would do it. Worst case scenario, Nintendo releases Nintendogs and forces you to use the NSO app’s voice chat to talk with your dog. You know they’d do it. There’s also the fact that another developer released a nintendogs clone for the Switch last year, but I don’t think Nintendo gives a shit. Chances: Good Nintendo Wars You may know this series better as “Advance Wars” and you may also know that it is fantastic. In fact, it is one of the highest rated Nintendo franchises on Metacritic, and had a pretty consistent release schedule between 1988 and 2008. All was looking pretty god. But unfortunately the series has been dormant since the last entry on DS. Part of it may be because the series, though originally Japan-only, was never all that popular in Japan. In fact, that last game only saw a limited release as a My Nintendo reward in the region. There is, however, still demand for the series, both externally and internally. Producers from both Nintendo and developer Intelligent Systems have expressed enthusiastic support for a new entry, although they’ve also expressed some uncertainty on what they’d do with it, similar to the Custom Robo and F-Zero responses. The developer for the series is Intelligent Systems, who do a ton of stuff and will be discussed multiple times in this post. They used to release multiple games a year, but have slowed down this past game to just one or two games a year, another possible reason why Advance Wars has been deprioritized, especially in comparison with that boogeyman of Advance Wars and Smash Bros fans alike: Fire Emblem. There is real concern that Nintendo might not want to make a new Advance Wars when they could just make the similar but more popular Fire Emblem instead. That said, IS has already released a Fire Emblem and Paper Mario for Switch, and though we definitely will get at least one more FE during the Switch’s life cycle, there’s enough years left for IS to release some other games, whether they be AW or one of the three other franchises we’ll discuss in the future. Problem is, of those franchises, AW might be the most difficult to produce, and the most risky, so it could probably be lower priority. When asked about the series last year, one IS producer gave a pretty evasive answer, so things aren’t looking too good, but they aren’t hopeless either. Chances: Medium Ouendan/Elite Beat Agents This rhythm series for the DS is widely beloved by those who played it, but its life cycle was pretty limited. One game in 2005, and Americanized version in 2006, and one sequel in 2007. Nothing more since The games were critically acclaimed, but not blockbuster hits. The series creator said back in 2016 that he would love to create a new game, but nothing else has been said about it. The game’s developer iNis, doesn’t appear to be super active either. All in all, there is very little pointing to a return Chances: Bad Pilotwings The biggest obstacle to seeing this series of arcadey flight sims on the Switch is that the series has a very specific purpose: it’s a tech demo. All three games were launch titles for their systems and explicitly meant to show off each system’s new tech. The original game was made to show off the SNES’ Mode 7, the N64 game was meant to show off the console’s polygonal graphics, and Resort was meant to showcase the 3DS’ stereoscopic 3D. With the Switch’s release far behind us, and its graphics not really needing a showcase, Pilotwings chances seem low. Granted, Pilotwings doesn’t need to be a tech demo, but it could be how Nintendo views it as. There is some fan demand for it, but not as much as F-Zero or Golden Sun, and no developer has commented on the possibility of a return. Pilotwings has always been moderately successful, but not enough to justify constant releases. The only glimmer of hope is the comment from Nintendo’s CEO about wanting to bring more 3DS franchises for the Switch, but it’s quite possible that he didn’t have Pilotwings in mind when he said that Chances: Bad Punch-Out!! Another series popular enough to get a Smash character but not popular enough for consistent sequels, Punch-Out is a beloved classic with a consistent fanbase, but with a very erratic release schedule. After the SNES game in 1994, the series lay dormant for 15 years until it was revived for the Wii in 2009 and then laid to rest again. One explanation is that the series was never really popular in Japan. Neither the NES or SNES games were even available as full releases in the country, being instead, distributed as prizes or rewards. And though the Wii game got a full retail release, it sold very poorly. It’s always been a game more for Americans, so it is understandable that the Japanese developers at Nintendo aren’t super enthusiastic about it. That said, it was Nintendo who pitched the reboot in the first place, so they may want to do it again someday. The developer for the Wii game was Next Level Games, who release a game every three or two years, and they also develop Mario Strikers and Luigi’s Mansion. Having already released LM3, it’s likely they’ll release another game for the Switch some time soon. That could be Punch-Out, but it is just as likely that it could be Mario Strikers, or something else entirely. Some think that the series use of flagrant national stereotypes would impede it from coming back in today’s political climate, but frankly, I don’t think that’s as definitive a problem. Worst case scenario, they simply make a new cast, just like Super Punch Out, but less racially insensitive. Another interesting development is that Mike Tyson has been talking about wanting a new Punch-Out this year. I don’t think Nintendo cares what he says, and they definitely don’t want to associate with him again, but it is a pretty high-profile person talking about the series, which is bound to raise interest. Whether that’s enough for Nintendo to consider a new game? I don’t think so. But regardless, Punch-Out is popular enough that the door is never truly closed for it. Chances: Not Good Pushmo This acclaimed puzzle game was released for the 3DS eshop in 2012 and was successful enough to get three sequels. Although it hasn’t been seen since 2015, there doesn’t seem to be anything impeding its return. The developer is our good friend Intelligent Systems, and, of the aforementioned IS franchises still to launch on the Switch, Pushmo, being a simple, but beloved, puzzle game, seems like the safest investment. It likely could be developed alongside another major game. There is demand for it, and considering Nintendo’s eshop efforts, Pushmo would fit in perfectly alongside Snipperclips and fellow 3DS eshop puzzle star Boxboy. All in all, there’s no reason not to expect Pushmo to come back. Chances: Good continued in comments
In 2015, Americans bet $149 billion illegally on sporting events. Today’s infographic from Longitude breaks down America’s multi-billion dollar sports betting industry. It shows the four states where fixed odds betting through bookmakers is legal, and it also compares a more legal alternative that’s available in 43 states. Sports betting services are provided by companies such as William Hill, Ladbrokes, bet365, bwin, Paddy Power, betfair, Unibet and many more through their websites and in many cases betting shops. With the global sports betting market growing by unbelievable leaps and bounds, it's clear that there is incredible potential for sportsbooks and bettors alike. See how the digital revolution is affecting the way the sports betting industry is expanding and forging its way in the international market! At present, the international sports betting industry claims to have by and large souk capitalization of approximately $250 billion, whereas the revenue is estimated to be only $30.4 billion from ... According to the report, the global sports betting market was valued at around USD 104.31 billion in 2017 and is expected to reach approximately USD 155.49 billion by 2024, growing at a healthy ...
Marketology What You Need To Know About The Sports Betting Industry Sportsbook Review
How to Win at Sports Betting - Book is out as well as playlist Book out now! How to Win at Sports Betting and Score a Better Life! Use link below to purchase! https://goo.gl/Ed5Q9o SUBSCRIBE for ... The Nasdaq is betting on the U.K's sports betting industry with a new technology. Scott Shechtman, head of new markets in Nasdaq's market technology business, joins 'The Exchange' to discuss. New Jersey gambling regulators have revealed how the state's new sports betting market did in its first weeks. CBS2's Meg Baker reports. One of Xerfi Global’s latest reports examines the global gambling industry, a steadily growing market worth over €211bn in 2003, €309bn in 2010 and €374bn in 2017, giving a healthy average ... Amidst scandals, legislative battles and the new frontier of daily fantasy, the biggest debate in the world of sports today is gambling. Is it legal? WATCH N...
