PPI and more +3

09:17 15-May-23

This should be a quiet week but for the debt ceiling, where we may get an update tomorrow.  The media is more positive than my shutdown guess, and I hope it is right.  I worry that it may not be adjusting for politician-speak, though.  "Productive" staff meeting could be meaningful, but the Biden's optimism is not when you dig down to the source.

I'll also document that Amdocs earnings:

• $1.47 of EPS
• from $1.2b of revenue

were completely in line both with analyst numerical expectations and my own for competing well in the face of increased competitive pressure.  The only items of any note at all are that the company made a $90M acquisition and has been selected to handle the European network transformation for Colt's purchase of Lumen's network there.

The PPI report featured headline and core numbers that came in a tenth below expectations at 0.2%.  Readers should know that I regard this as more forward-looking than yesterday's CPI, and thus a data point in favor of a Fed pause and eventual rate reduction.  Services continued to dominate the report, though, meaning that we'll need to see wages come down in the jobs reports.  Since those are trailing data, I still regard this report as positive.  Per my follow up, this is vaguely positive for debt-strapped stocks like LUMN.  The commentary there should have more lingering applicability to GRoDT stocks, like eMagin, which reported first quarter results:

• a loss of 3 cents per share misses by 2 cents
  
• from $6.6M of revenue, which misses by $1M

The misses are due to more legacy production problems, and my view is unchanged, meaning I wouldn't want to own EMAN at half the current price.