It’s the busiest week of the earnings season and will have serious consequences for the stock market. Around 160 S&P 500 corporations are on account of publish their results, including Apple, Amazon and McDonald’s. Pfizer can be on deck. By Friday’s close, greater than 200 members of the S&P 500 had reported their first-quarter results. According to FactSet data, 80% of those corporations exceeded expectations. Of course, tech giants like Meta Platforms and IBM struggled after releasing their latest numbers. Take a take a look at CNBC Pro’s breakdown of expectations for a few of this week’s biggest stories. All times are eastern. On Tuesday, McDonald’s will announce its earnings before the bell, followed by a call at 8:30 a.m. Last quarter: MCD missed sales because the conflict within the Middle East put pressure on the corporate’s sales. This quarter: The fast food giant is predicted to report single-digit profit and revenue growth in comparison with the identical period last 12 months, in line with LSEG. What CNBC is Watching: McDonald’s is entering this quarterly report struggling, with shares down greater than 7% year-to-date. Can it get out of the crisis? Barclays analyst Jeffrey Bernstein believes the Q1 report could mark a turning point for McDonald’s. The analyst has a price goal of $340, representing greater than 20% upside potential, and an chubby rating. “MCD offers unique liquidity, size and scale within the industry, coupled with strong fundamental growth across the globe and significant cash yield, while maintaining relatively modest balance sheet leverage and significant real estate holdings, the latter of which generates outsized rental income. “We believe it is underestimated,” Bernstein wrote in an April 19 note. What History Shows: McDonald’s profits have exceeded expectations for eight consecutive quarters, in line with Bespoke Investment Group. However, they sometimes remain unchanged on earning days. Coca-Cola is predicted to report earnings premarket. Management is scheduled to carry a conference call at 8:30 a.m. Last Quarter: Higher prices led to better-than-expected revenue for KO. This quarter: According to LSEG, Coca-Cola’s profits and revenue are expected to be little modified from last 12 months. What CNBC is watching: Organic revenue growth might be the important thing metric to observe. JPMorgan’s Andrea Teixeira expects growth of 4.9% in comparison with the identical period last 12 months. However, that is below a consensus of seven%, the analyst said. She also said that the corporate “faces a relatively difficult comparison in gross margins, as was the case last year, as there were approximately 70 basis points of more discrete benefits within cost of sales that are being lapped up, although we still saw solid margin expansion despite the puts and takes.” See.” Teixeira is overweight the stocks. What history shows: Coca-Cola has a strong track record of beating analysts’ earnings estimates with a beat rate of 72%, according to Bespoke. However, on average, stocks only rise on earnings days by 0.1%. Amazon is expected to report earnings after the market close. A call with company management is scheduled for 5:30 p.m. Last quarter: AMZN reported better-than-expected earnings as revenue rose 14% year-over-year : According to LSEG, the e-commerce giant is expected to report profit growth of more than 160% compared to the same period last year. What CNBC is watching: Amazon shares have been on a roll year to date, up 18%. Telsey analyst Joseph Feldman expects this momentum to continue when Amazon reports earnings. “We expect continued double-digit revenue and profit growth in Q1 2024 – reflecting strength in online spending, gains from expanded merchandise offerings and faster fulfillment, and the stabilization (and growth) of AWS,” wrote Feldman, who posted an Outperform valuation and a price of $200 has targeted the stock. What History Shows: Bespoke data shows Amazon has beaten profit estimates four quarters in a row. The shares also recorded significant gains on three of these four reporting days. On Wednesday, Pfizer will report earnings before the market closes. A conference call is expected at 10 a.m. Last quarter: PFE beat earnings expectations as the company’s Covid business performed slightly better than expected. This quarter: According to LSEG, the pharmaceutical giant is expected to see significant year-over-year declines in profits and sales. What CNBC is watching: Pfizer shares have been under pressure this month, falling more than 8%, even after the company’s respiratory syncytial virus vaccine showed potential to protect high-risk adults ages 18 to 59 and the Food and Drug Administration had approved his gene therapy for a rare congenital blood clotting disorder. Can this report help turn things around for the struggling pharmaceutical giant? What History Shows: Pfizer’s profits exceeded earnings expectations 87% of the time, according to Bespoke. However, the stock has fallen on three of the last four reporting days. Apple will report its earnings after the market closes on Thursday. Management is expected to hold a conference call at 5:00 p.m. Last quarter: AAPL fell after the tech giant’s outlook suggested weaker iPhone sales. This quarter: The tech giant’s profits are expected to have fallen slightly year-on-year, LSEG data shows. What CNBC is watching: The struggling member of the Magnificent Seven goes into the report with questions about his efforts in artificial intelligence and increasing competition in China. Last week, UBS said Apple’s smartphone market share in China fell about 3.6% year-on-year, while its iPhone sales rate – the percentage of phones sold by retailers – fell 13% in March compared to the previous month % has decreased. What History Shows: Apple has beaten earnings expectations four quarters in a row, Bespoke data shows. However, shares fell on three of the last four reporting days, including a 4.8% decline.
Thursday, November 28, 2024
