US companies have barely been able to achieve positive earnings growth so far during this quarterly results season, but the big test starts next week.
About a quarter of the S&P 500
It is set to report results with companies representing 39% of the index by market value, based on calculations based on FactSet data. Given that the S&P 500 is weighted by market value, this list of companies will have a tremendous impact on the profit trajectory of the index.
Earnings expected to fall for the fourth consecutive quarter Once all results are from recent period, but companies that have reported so far exceed expectations in total.
FactSet consensus is now modeling a 5% gain drop for the index, Compared to projected 6.3% drop one week ago. If the profit growth for the S&P 500 ultimately turns out to be positive, it marks the end of the current earnings stagnation that occurs when company profits fall for two or more consecutive quarters.
and Facebook Inc.
Tesla Inc. is among the most important topics of the next week, along with.
for the first time since then Became a member of S&P 500. All three high-profile companies are scheduled to report on Wednesday afternoon and are expected to generate record revenue in the holiday quarter.
For Apple, which launches new iPhones in the fall, the holiday season is always very important. With a slightly later launch this year due to the epidemic that pushed sales back to that period, Apple’s widespread highest quarterly total income ever and The first total to exceed 100 billion dollars. The tech giant likely continued to see the benefits of distance working and distance learning trends. strong iPad and Mac sales During the COVID-19 crisis.
Given the strong digital advertising trends during the holiday season, Facebook is expected to easily release a period that should have been a record quarter. Still the company will face questions regarding user engagement and Ban Donald Trump from the platform indefinitely On his role in provoking violent rebellion in the US Capitol. Bernstein analyst Mark Shmulik points to “ongoing use fatigue” on social media and a “distorted speech to political events that cannot be monetized”.
Tesla has already revealed delivery numbers for the whole year surpassed analyst expectations, and all eyes will be on the company’s 2021 view. RBC Capital Markets analyst Joseph Spak predicts deliveries of 825,000 to 875,000 million units for the full year, although Tesla’s latest earnings call said it was “not too far away” as an analyst expected 840,000 to one million deliveries. 2021.
Full preview: Can Tesla’s sales growth match stock growth?
Here’s what else to watch next week bringing reports from the 117 members of the S&P 500 and 13 of the Dow Jones Industrial Average.
In the air
Despite the company’s 737-MAX jets being recertified after nearly two years of stranding, the journey remains turbulent. According to Benchmark Company analyst Josh Sullivan, although the company begins deliveries of these planes, “the speed of delivering all 450 parked 737-MAXs will be determined by the airline customers’ ability to absorb the aircraft and air traffic demand.”
Boeing’s Wednesday morning report will provide insight into the company’s recovery prospects during the pandemic, but Sullivan looks ahead to the volatility resulting from a recent stock supply and the impact of the COVID-19 crisis on airlines.
and Southwest Airlines Co.
Offer more on Thursday morning.
Can you hear me now?
Verizon Communications Inc.
Tuesday morning leading a busy week of telecommunications revenues, followed by AT&T Inc.
Wednesday morning and Comcast Corp.
It will be a major problem for wireless operators The impact of iPhone 12 promotions on final results. Investors will also look for information on a new range of wireless auction offers that will be crucial for 5G network deployments. Although the offers have not yet been made public, the auction led to record spending, and AT&T and Verizon are both expected to pay generously to prove their existence. The question for investors is what impact these offers will have on companies’ financial positioning.
AT&T and Comcast are exposed to more media than Verizon, and these two companies are struggling with the new realities that the pandemic brings. Both companies made moves to highlight streaming more on movie charts theater closures and the financial consequences of these movements will be worth watching.
The situation with the pandemic is perhaps not more clearly reflected than the results of Visa Inc.
and American Express Co.
with the pulse in the global consumer spending landscape. Companies should provide insight into a travel rebound towards the end of the year and the impact of recent lockdowns.
Susquehanna analyst James Friedman recently wrote that the $ 3.97 billion Mastercard revenue projection was slightly below the consensus view, but he also asked the question: “Does anyone really care about Q4 2020?” Friedman is optimistic about mobile payments and online shopping dynamics, suggesting “positive trends ahead” for Mastercard released Thursday morning. That afternoon, Visa starts the week with the American Express Tuesday morning report.
The chip saga continues
Advanced Micro Devices Inc.
Will continue to take advantage of Intel Corp.
Jefferies analyst Mark Lipacis said after Intel’s latest earnings report, “We have low confidence that Intel will rapidly close this transistor gap and therefore continue to lose share for the foreseeable future.” When AMD releases the numbers on Tuesday afternoon, it will show how this dynamic plays out on its side of the equation.
Other chip makers reporting next week include Texas Instruments Inc.
; and Western Digital Corp.
It’s a busy week for the Dow
Among the 13 members of the Dow Jones Industrial Average
JP Morgan analyst Chris Schott wrote about Johnson & Johnson: “In the near term, we see the company’s COVID-19 vaccine reading as an upcoming major catalyst, and we believe that more than 80% product range activity will propose a clear role in the market for the product”.
Cowen & Co. analyst J. Derrick Wood sees tough comparisons for Microsoft, especially in Azure and server businesses, but awaits a more favorable situation ahead.
Wednesday brings results from Boeing and Apple, while on Thursday McDonald’s Corp.
and Visa. Honeywell International Inc.
and Caterpillar Inc.
Friday morning completes the week.