Market Snapshot
| Dow | 42140.43 | -269.67 | (-0.64%) | | Nasdaq | 19010.08 | +301.74 | (1.61%) | | SP 500 | 5886.55 | +42.36 | (0.72%) | | 10-yr Note |
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| | NYSE | Adv 1631 | Dec 1052 | Vol 1.2 bln | | Nasdaq | Adv 2554 | Dec 1851 | Vol 9.2 bln |
Industry Watch
| Strong: Technology, Discretionary, Industrials, Financials, Energy |
| | Weak: Health Care, Real Estate, Consumer Staples |
Moving the Market
-- Still keying off trade war de-escalation
-- Digesting this morning's CPI report, which didn't contain any tariff-related inflation shock
-- Big decline in UnitedHealth (UNH) weighing down DJIA
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Closing Summary
13-May-25 16:25 ET
Dow -269.67 at 42140.43, Nasdaq +301.74 at 19010.08, S&P +42.36 at 5886.55
[BRIEFING.COM] It was another winning session for stocks. The S&P 500 (+0.7%) and the Nasdaq Composite (+1.6%) extended this week's gains, leading the S&P 500 to erase its 2025 losses. The index is fractionally higher this year, powered by a strong rally in mega caps and chipmakers.
NVIDIA (NVDA 129.93, +6.93, +5.6%) was a standout in that respect, leading the S&P 500 technology sector to close 2.3% higher.
The Dow Jones Industrial Average was left out of the rally due a big loss in UnitedHealth (UNH 311.38, -67.37, -17.8%). It's one of the most influential names in the price-weighted average, sinking following the news that CEO Andrew Witty is stepping down for personal reasons and that the company is suspending its 2025 outlook as it grapples with higher-than-expected medical costs.
UnitedHealth's outlook suspension was a reminder that there is still a lot of uncertainty in the market, yet it didn't translate into broad selling. Many stocks participated in upside moves today, leading the equal-weighted S&P 500 to close 0.2% higher.
The upside action was also driven by a fear of missing out on further gains, momentum after the notable de-escalation in the trade war with China, and an April Consumer Price Index that lacked any tariff inflation shock. Also, it has been enthused by the news that Saudi Arabia, in conjunction with President Trump's visit there, announced a $600 billion investment plan in the U.S.
The 10-yr yield settled 4.50%, which is 13 basis points higher than Friday's settlement and 32 basis points higher than "Liberation Day" when President Trump announced sweeping tariffs on most nations.
- S&P 500: +0.1% YTD
- Dow Jones Industrial Average: -1.0% YTD
- Nasdaq Composite: -1.5% YTD
- S&P Midcap 400: -2.0% YTD
- Russell 2000: -5.7% YTD
Reviewing today's economic data:
- April NFIB Small Business Optimism 95.8; Prior 97.4
- April CPI 0.2% (Briefing.com consensus 0.3%); Prior -0.1%, April Core CPI 0.2% (Briefing.com consensus 0.3%); Prior 0.1%
- The key takeaway from the report is the absence of any tariff shock in the headlines. Consumer prices, overall, were held in check, for the most part, including food and gasoline.
Looking ahead to Wednesday, market participants receive the following data:
- 7:00 ET: Weekly MBA Mortgage Index (prior 11.0%)
- 10:30 ET: Weekly crude oil inventories (prior -1.11 mln)
Treasuries settle lower
13-May-25 15:30 ET
Dow -161.23 at 42248.87, Nasdaq +372.51 at 19080.85, S&P +56.58 at 5900.77
[BRIEFING.COM] Major equity indices are near session highs ahead of the close.
The 10-yr yield settled at 4.50%, up four basis points from yesterday, and the 2-yr yield settled two basis points higher at 4.02%.
Looking ahead to Wednesday, market participants receive the following data:
- 7:00 ET: Weekly MBA Mortgage Index (prior 11.0%)
- 10:30 ET: Weekly crude oil inventories (prior -1.11 mln)
10-yr yield hits 4.50%
13-May-25 15:10 ET
Dow -172.39 at 42237.71, Nasdaq +343.35 at 19051.69, S&P +57.43 at 5901.62
[BRIEFING.COM] The major equity indices moved mostly sideways in recent trading.
The 10-yr yield hit 4.50%, which is 13 basis points higher than Friday's settlement and 32 basis points higher than "Liberation Day" when President Trump first announced sweeping tariffs on most nations.
Separately, the CBOE Volatility Index (VIX) is 3.5% lower at 17.76.
S&P 500 up 0.9%, led by First Solar and Palantir; Elevance Health drops on Medicaid concerns
13-May-25 14:30 ET
Dow -178.43 at 42231.67, Nasdaq +328.16 at 19036.50, S&P +53.90 at 5898.09
[BRIEFING.COM] The S&P 500 (+0.92%) is in second place on Tuesday afternoon.
Briefly, S&P 500 constituents First Solar (FSLR 188.39, +32.18, +20.60%), Super Micro Computer (SMCI 39.06, +5.54, +16.53%), and Palantir Technologies (PLTR 128.99, +10.53, +8.89%) pepper the top of the standings. FSLR pops after new details from the House Ways and Means Committee's budget bill that support the Inflation Reduction Act's provisions, including unchanged 45X credits through 2028 (60% of FSLR's earnings are tied to these credits) and new limitations on foreign-influenced products, SMCI is higher after Raymond James started coverage with an Outperform, tgt $41 (+22.3% from yesterday's close), while PLTR caught an insider buy from its Chief Accounting Officer to the tune of $1.16 mln.
Meanwhile, Elevance Health (ELV 379.32, -37.37, -8.97%) is one of today's worst laggards due to challenges in its Medicaid business, compounded by legislative uncertainties. A proposed Medicaid spending cut by House Republicans, which includes work requirements and more eligibility checks, is further heightening investor concerns.
Gold futures rebound amid tariff truce and soft inflation data
13-May-25 14:00 ET
Dow -158.41 at 42251.69, Nasdaq +316.71 at 19025.05, S&P +52.07 at 5896.26
[BRIEFING.COM] With about two hours to go on Tuesday the tech-heavy Nasdaq Composite (+1.69%) holds a firm lead among the major averages.
Gold futures settled $116 lower (-3.5%) at $3,228/oz, aided in part by bargain-buying following a recent dip in prices. The dip was attributed to a temporary U.S.-China tariff truce that had previously bolstered risk appetite and diminished gold's appeal as a safe-haven asset. The truce involved significant tariff reductions: U.S. tariffs on Chinese imports were cut from 145% to 30%, and Chinese tariffs on U.S. goods were reduced from 125% to 10%, improving global market sentiment. Additionally, softer-than-expected U.S. inflation data bolstered expectations of potential Fed rate cuts, further supporting gold prices.
Meanwhile, the U.S. Dollar Index is now down -0.7% to $101.07.
CyberArk secures a 1Q25 beat on strong machine identity demand, cautious outlook caps gains (CYBR)
Identity security company CyberArk (CYBR) delivered solid 1Q25 results, exceeding top and bottom-line expectations with revenue surging by 43% yr/yr to $317.6 mln, fueled by enterprises prioritizing cybersecurity and rising threats. The identity security market remains a top priority for organizations, with competitors like Okta (OKTA) and SailPoint (SAIL) also reporting robust demand for their Identity and Access Management and Identity Governance and Administration solutions, reflecting a broader industry trend of increased investment in securing human and machine identities.
However, CYBR's cautious guidance for Q2 and FY25 has tempered investor enthusiasm, particularly after the stock had rallied by about 20% since early April. Despite comfortably surpassing Q1 revenue estimates, the company's FY25 revenue was essentially in-line with expectations, signaling some apprehension and uncertainty about its growth prospects for the remainder of the year.
- CYBR's Annual Recurring Revenue (ARR) reached $1.215 bln, a near 50% yr/yr increase, driven by robust net new ARR of $46 mln. This growth rate is slightly below the 51% ARR increase reported in Q4, reflecting a normalization after a milestone of surpassing $1 billion organically in 2024, but it underscores sustained demand for CYBR’s subscription-based model. The $46 mln in net new ARR, consistent with recent quarters, indicates strong customer acquisition and expansion, particularly in machine identity and Secrets Management solutions.
- On that note, momentum behind the machine identity business, bolstered by CYBR's 2024 acquisition of Venafi and increasing contributions from its Secrets Management products, is becoming a key growth catalyst. The $1.54 bln acquisition of Venafi has accelerated CYBR’s capabilities in securing machine identities, a critical area as enterprises manage increasing numbers of non-human identities in cloud and AI-driven environments. Secrets Management, addressing secure storage and rotation of credentials, has also seen strong adoption, driven by heightened awareness of vulnerabilities exposed by recent cyberattacks.
- Additionally, organizations are consolidating cybersecurity spend on CyberArk’s unified platform, indicating high customer loyalty and upselling success. This consolidation trend is supported by CYBR’s integrated approach, combining PAM, IGA, and machine identity security, which reduces complexity and enhances value for enterprises.
- From a profitability standpoint, robust revenue growth, high gross margin of nearly 76%, a subscription-heavy revenue mix, and economies of scale are pushing earnings higher. In Q1, adjusted EPS jumped by 31% yr/yr to $0.98, while non-GAAP operating profit expanded by 3 ppts yr/yr to 18%.
CYBR's 1Q25 outperformance was driven by strong demand for its identity security platform, particularly in machine identity and Secrets Management, bolstered by the Venafi acquisition and a robust 49.8% ARR growth. However, cautious 2Q25 and FY25 guidance, reflecting potential macroeconomic and integration risks, is tempering investor enthusiasm despite the stock’s recent rally, as the market balances near-term uncertainties with long-term growth potential.
On really turned it on with nice upside in Q1; DTC and new launches have been nice catalysts (ONON)
On Holding (ONON +9.5%) is making a big move following its Q1 report this morning. It was only a slight EPS beat, but this Switzerland-based athletic footwear company reported huge upside on the top line. Revenue rose 43% yr/yr to CHF726.6 mln. Also, ONON raised its FY25 revenue outlook to +28% CC from +27% CC. Also, On benefitted from new product launches like the Cloud 6 and the Cloudsurfer 2.
- This was a good result considering ONON's leadership is in flux. Recall that last quarter co-CEO Marc Maurer announced he will be leaving July 1. The current CFO and the other co-CEO, Martin Hoffmann, will become the sole CEO. The outgoing co-CEO helped the company go public in 2021. He also helped to initiate a quick rebound a couple of years ago, ultimately outperforming some of its closest rivals in NIKE (NKE) and Adidas (ADDYY).
- Turning to the Q1 results, demand for On remains incredibly strong, largely fueled by its direct-to-consumer (DTC) channel, which includes online and company-owned stores. DTC channel sales jumped 45.3% yr/yr (+42.4% CC) to CHF 276.9 mln. This growth was ahead of internal expectations with both e-com and retail contributing strongly to this result. What really stood out was its Tokyo store, which even surpassed its richest street store in London in terms of sales. Wholesale was no slouch, with sales up 41.5% yr/yr (+38.6% CC) to CHF 449.7 mln in Q1 as retailer demand for the new Cloud 6 franchise has been exceptionally strong worldwide.
- The company believes its positioning as the most premium global sportswear brand in the marketplace is resonating with fans. For example, its new Cloudsurfer 2 has already gained strong global traction as a key running franchise. Another key launch was Cloud 6, On's largest product launch ever. The company remains very excited about its upcoming LightSpray technology. A robot fuses 1.5km of filament forming a complete shoe in a single, three-minute step with no glues and no seams, reducing waste and emissions. It's one of the lightest sneakers ever at a mere six ounces. 2025 will be a key year for testing and optimizing this technology.
- Looking ahead, On is excited about the remainder of 2025. Entering Q2, it continues to see strong consumer demand across all global markets and channels. Its pipeline of new product launches in 2H25 includes running products like the Cloudsurfer Max, the Cloudflow 5 and the Cloudboom Max, its first super shoe for the everyday runner. On is already seeing strong preorders for 2H from wholesale partners.
Overall, this was an impressive quarter for ONON. DTC sales really stood out, but wholesale performed very well also. Recent launches have performed very well with more to come in 2H25. While other athletic brands have struggled, especially Nike, On really turned it on in Q1. We think this report and commentary is easing fears about losing Marc Maurer as co-CEO in a few weeks. The brand seems to be in capable hands.
UnitedHealth tumbles after CEO shakeup and scrapped FY25 guidance (UNH)
A tough year forDow component UnitedHealth (UNH) is taking another turn for the worse as shares plunge to multi-year lows driven by two pivotal developments: the unexpected resignation of CEO Andrew Witty for personal reasons and the company's decision to suspend its 2025 financial outlook. The appointment of Stephen Hemsley, a former CEO of UNH (2006-2017) and current Chairman, as Witty's replacement introduces both continuity and uncertainty.
Compounding these issues, UNH's recent history of operational challenges -- evidenced by a downward revision of its FY25 EPS guidance on April 17, and a miss on 1Q25 earnings and revenue estimates -- has amplified investor concerns about near-term performance. Despite these fierce headwinds, UNH remains optimistic about a return to growth in 2026, citing strategic cost management and operational adjustments, such as transitioning more effectively to the new CMS (Centers for Medicare & Medicaid Services) risk model.
- Witty, who has led UNH since February 2021, is widely credited with steering the company through the complexities of the post-COVID healthcare landscape, including navigating regulatory pressures and rising medical costs. His departure, attributed to personal reasons, lacks specificity, fueling speculation and raising a red flag about undisclosed, deeper operational challenges.
- While Witty's tenure was marked by efforts to expand UNH's Optum division, the company's recent performance -- particularly the weak 1Q25 results and FY25 guidance cut -- suggests it hasn't adapted quickly and significantly enough to mitigate the impact of rising medical costs. Investors may perceive Witty’s exit as an acknowledgment of these struggles, eroding confidence in the company’s near-term trajectory.
- Stephen Hemsley’s return as CEO offers a mix of reassurance and concern. Hemsley is a known quantity, with a track record of driving growth during his prior tenure, including scaling UNH into the largest U.S. health insurer by market share. However, Hemsley’s appointment at age 72 raises questions about the long-term succession plan, as his role may be perceived as a stopgap rather than a permanent solution.
- Investors may also scrutinize Hemsley’s ability to address current challenges, which differ from those during his previous tenure. The healthcare landscape in 2025 is marked by intensified regulatory scrutiny, rising medical loss ratios, and evolving reimbursement dynamics in Medicare Advantage. Hemsley’s prior experience, while robust, may not fully align with these modern complexities.
- UNH’s decision to suspend its 2025 financial outlook is another critical factor in today’s plunge. The company cited “unexpectedly high medical costs,” particularly in its Medicare Advantage business, as the primary driver. Medicare Advantage, a key growth segment for UNH, has faced increasing cost pressures due to higher-than-anticipated utilization rates and regulatory changes affecting reimbursement rates. Post-COVID, patients are seeking more elective procedures and chronic care, driving up medical costs.
- Making matters worse, UNH’s efforts to integrate its Optum health services division with its insurance operations have encountered inefficiencies, impacting cost control.
Today's developments compound existing concerns stemming from the weak 1Q25 results and FY25 EPS guidance cut. UNH’s optimism about 2026 growth, supported by cost management and Optum integration efforts, suggests a path to recovery. However, near-term volatility is likely to persist until the company demonstrates progress on medical cost control.
Chewy slides lower as CFO exit and unchanged Q1 guidance stir growth concerns (CHWY)
Chewy (CHWY) is trading lower, driven by the surprise departure of CFO David Reeder, and a reaffirm of 1Q25 guidance that's stirring up some disappointment following the company's stellar Q4 earnings report in late March. Mr. Reeder, who joined CHWY in March 2023 after serving as CFO of Global Foundries, is stepping down to assume a CEO role in the semiconductor industry, with his exit slated for after the 1Q25 results on June 11, 2025. The departure of a seasoned CFO -- particularly one who has overseen a period of robust financial performance -- introduces some uncertainty around CHWY's ability to sustain its momentum.
- Investors often view executive turnover as a potential risk to operational stability, particularly for a company navigating a competitive e-Commerce landscape and macroeconomic headwinds like tariff concerns and inflation. The absence of a named successor amplifies these worries as CHWY has only indicated that a search for Reeder's replacement is underway, leaving a leadership gap that could unsettle the market.
- Additionally, Reeder's recent stock sales -- totaling around $16 mln across February transactions -- may signal a lack of long-term commitment, further eroding investor confidence.
- In the same press release, CHWY reaffirmed its Q1 guidance, projecting net sales of $3.06-$3.09 bln and EPS of $0.30-$0.35. By failing to deliver an upward revision of its outlook, CHWY likely added to the negative sentiment, especially with shares up by 146% on a yr/yr basis. The decision to maintain guidance, despite a robust 4Q24 earnings report in which CHWY easily beat EPS expectations and returned to double-digit revenue growth for the first time since 2Q24 at +15%, suggests possible caution around consumer spending softness in discretionary pet categories.
- CHWY's improved growth in Q4 was underpinned by a return to active customer growth and enhanced customer loyalty through its Autoship program. Autoship customer sales, a cornerstone of CHWY’s recurring revenue model, surged 21% in Q4 to $2.62 billion, representing 80.6% of net sales. The reaffirmed Q1 guidance, while solid, may be perceived as conservative, failing to capitalize on the Q4 beat’s momentum.
The departure of CFO David Reeder, coupled with his significant stock sales and the lack of a named successor, has rattled investors, raising concerns about CHWY’s ability to maintain its strong financial trajectory amid a competitive and uncertain macro environment. The decision to merely reaffirm Q1 2025 guidance, despite a robust Q4 earnings beat, has further disappointed investors expecting a more bullish outlook, contributing to today’s stock price decline. While CHWY’s operational momentum remains intact, the leadership transition and conservative guidance signal near-term risks.
Monday.com crushes Q1 estimates on robust enterprise adoption, but guidance limits rally (MNDY)
Project management software company Monday.com (MNDY) has a strong track record of surpassing quarterly expectations, though it has occasionally tempered investor enthusiasm by offering conservative guidance. That trend continued today as MNDY easily beat 1Q25 EPS and revenue estimates, driven by robust demand for its multi-product platform, while its in-line Q2 revenue guidance and modestly improved revenue forecast for FY25 looks underwhelming.
Strategic investments in AI-driven features, such as the GenAI chatbot that's resolving a high percentage of customer service tickets, and a scalable MondayDB 2.0 infrastructure, are laying the foundation for MNDY's consistent top and bottom-line beats.
- Key metrics, such as net dollar retention (NDR) rate and total number of paid customers, highlight the platform's stickiness and ability to drive customer expansion. NDR for customers with more than $100,000 in ARR reached an impressive 117%, illustrating healthy upsell and cross-sell activity particularly among larger accounts. Relatedly, the total number of paid customers grew to 57,203, up 15% yr/yr, with 1,328 customers contributing over $100,000 in ARR, a 46% increase from the prior year.
- These metrics were bolstered by MNDY's multi-product strategy, which integrates work management, CRM, service management, and software development tools into a unified platform. New product launches, including MondayDB 2.0, enabling boards with up to 100,000 items, and AI advancements, like AI Assistant, have enhanced scalability and user engagement, driving higher ARR and retention by addressing diverse enterprise needs.
- Profitability continued its upward trajectory in 1Q25, with adjusted EPS soaring 80% yr/yr to $1.10 and non-GAAP operating income reaching a record $41.0 mln with non-GAAP operating margin improving by 400 bps yr/yr to 14%. These gains were driven by disciplined cost management and operating leverage, despite hefty investments in R&D (+56% yr/yr) to fuel AI and product innovation. The company’s ability to balance growth-oriented investments with profitability stems from its high gross margin of approximately 90% and a scalable SaaS model, which minimizes incremental costs as revenue expands.
- For Q2, MNDY issued revenue guidance of $292-$294 mln, aligning closely with analysts' estimates, suggesting a cautious outlook amid macroeconomic uncertainty. MNDY nudged its FY25 revenue outlook modestly higher to $1.22-$1.23 bln from its prior guidance of $1.21-$1.22 bln, but its adjusted free cash flow guidance was notably strong at $286-$289 mln, driven by robust operating cash flow and minimal capital expenditures. This outlook is further supported by MNDY’s high retention rates, growing enterprise customer base, and efficient cash conversion cycle.
MNDY's 1Q25 beat-and-raise performance was driven by strong enterprise adoption, AI-driven product enhancements, and operational efficiency. The company's resiliency and scalability were once again on display amid a volatile macroeconomic backdrop, although its conservative revenue guidance is keeping a lid on shares.
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