R.M. Nunes
The final full week of October will offer the heart of the current quarterly earnings season. Following a release from Netflix in the week prior, each of its FAANG compatriots are due to post quarterly results over the period. Facebook parent Meta (NASDAQ:META), Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN), Alphabet (NASDAQ:GOOGL) (NASDAQ:GOOG), and Microsoft (NASDAQ:MSFT) are all set to release their quarterly results.
Joining the mega-cap titans reporting in the week, major automakers General Motors (GM) and Ford (F), consumer staples manufacturers Kraft Heinz (KHC), Coca-Cola (KO), and Colgate Palmolive (CL), defense leaders Boeing (BA), L3Harris Technologies (LHX), Raytheon Technologies (RTX), Aerojet Rocketdyne (AJRD), General Dynamics (GD), and Northrop Grumman (NOC) are expected to post quarterly updates.
Adding to the barrage of financial figures, payment processors Visa (V) and Mastercard (MA), major airlines American Airlines (AAL) and Southwest Airlines (LUV), and energy sector giants ExxonMobil (XOM) and Chevron (CVX) are set to report as well.
Below is a curated list of earnings due out between October 24 and October 28:
Monday, October 24
Packaging Corporation of America (PKG)
Packaging Corporation of American (PKG) is due to post its earnings report after the market close on Monday. In the 90 days prior to the results, consensus EPS estimates have been revised down 10 times. Indeed, both Jefferies and Deutsche Bank analysts cut their ratings on the stock to “Sell” based upon inventory concerns in the containerboard industry.
“Given weakening demand and upcoming capacity additions, we anticipate containerboard prices will fall by $100 per ton in total over the next year,” Deutsche Bank said on October 18.
- Consensus EPS Estimates: $2.81
- Consensus Revenue Estimates: $2.20B
- Earnings Insight: Packaging Corp. of America (PKG) has beaten EPS and revenue estimates in 7 of the past 8 quarters.
Also reporting: Aerojet Rocketdyne (AJRD), HSBC Holdings (HSBC) and Dorman Products (DORM)
Tuesday, October 25
Raytheon Technologies (RTX)
Raytheon Technologies (RTX) is due to post its third quarter earnings results prior to Tuesday’s market open. The defense contractor has significantly outperformed the market in a year filled with geopolitical turmoil. Shares of the Massachusetts-based missile manufacturer have managed to remain in the green during 2022, in contrast to an over 20% drop for the S&P 500.
The contractor has secured a number of hefty government contracts in 2022, including a $1B hypersonic missile order, a $770M engine contract for the Navy, and an over $300M contract for the US Army. Key peer Lockheed Martin (LMT) helped lift the defense sector with an earnings beat in the week leading up to Raytheon’s results.
- Consensus EPS Estimates: $1.14
- Consensus Revenue Estimates: $17.25B
- Earnings Insight: Raytheon has beaten EPS estimates in 8 straight quarters, but has only exceeded revenue expectations in 2 of those reports.
Microsoft (MSFT)
Microsoft (MSFT) is due to post its quarterly earnings update after the market close on Tuesday. Shares of the software giant have declined about 30% in 2022, outpacing declines in broader indices and accelerating to the downside since the summer in particular. The stock has shed 20% since mid-August.
Since August, analysts have reeled in estimates significantly with EPS and revenue estimates revised downward 33 and 37 times, respectively. The company has also cut a significant number of staff since that point, reportedly laying off 1,000 employees. Elsewhere, the expected acquisition of Activision Blizzard (ATVI) has come under scrutiny from UK regulators.
Just two weeks prior to the print, the stock was named a new short idea at Hedgeye. “We see more than 20% downside risk for MSFT as the company enters the estimate discovery process,” Hedgeye analyst Ami Joseph said. “When growth slows, the appropriate valuation consideration will change as well.”
Nevertheless, the overall sentiment on Wall Street remains bullish. According to Seeking Alpha data, the consensus rating remains bullish with 32 of 50 analysts advising clients that the stock remains a Strong Buy and another 16 advising a Buy rating.
- Consensus EPS Estimates; $2.31
- Consensus Revenue Estimates: $49.79B
- Earnings Insight: Microsoft has beaten EPS and revenue estimates in 7 of the past 8 quarters.
Meta Platforms (META)
Meta Platforms (META) is set to post its third quarter earnings results after the market close on Tuesday. Shares of the Mark Zuckerberg-led Facebook parent have slumped over 60% in 2022, with its February earnings miss prompting an over $200 billion loss in valuation in just a single trading day.
Documents leaked to the WSJ ahead of the results have also indicated continued struggles in the flagship metaverse offerings. Loup Ventures’ called the data in the documents a “very clear disappointment.” However, some on Wall Street remain upbeat. For instance, Citi named the stock a top pick ahead of the earnings report due to a “compelling” risk/reward opportunity and “relatively muted” earnings expectations.
- Consensus EPS Estimates: $1.87
- Consensus Revenue Estimates: $27.48B
- Earnings Insight: Meta has exceeded EPS estimates in 6 of the past 8 quarters, beating revenue expectations in 5 of those reports.
Alphabet Inc. (GOOGL)
Google parent Alphabet (GOOG) (GOOGL) will round out the slate of mega-cap tech reports due in Tuesday’s after-hours period. Shares of the tech giant have tumbled over 30% in the past year, accelerating declines since August alongside many of its tech peers.
Per Bloomberg, the company moved to cut back spending in its “other bets” division during the third quarter. Additionally, EU regulators have begun to bear down once again on the company’s ad-tech practices, according to Reuters. In September, a €4.12B fine levied by antitrust regulators on the continent was upheld.
Elsewhere, the company has moved towards monetizing more aspects of its business. The New York Times reported in September that the company is looking to monetize its TikTok competitor.
Meanwhile, Seeking Alpha Quant Ratings and Wall Street analysts surveyed by Seeking Alpha see the stock as a Strong Buy ahead of the Q3 report.
- Consensus EPS Estimates: $1.26
- Consensus Revenue Estimates: $70.74B
- Earnings Insight: Alphabet has exceeded EPS expectations in 6 of the past 8 quarters, rising above revenue estimates in 7 of those reports.
General Motors (GM)
Detroit-based automaker General Motors (GM) is set to post its third quarter earnings report prior to the market open. Shares of the auto manufacturer have declined over 45% in 2022.
Analysts have become divided over GM and its rival Ford (F) ahead of their respective Q3 reports. For example, UBS told clients that its “relative preference [for GM] over Ford remains” on October 10. Meanwhile, Morgan Stanley upgraded Ford (F) stock to a Buy-equivalent rating while trimming estimates on GM on October 5.
During the third quarter, GM increased its focus on EV efforts, earmarking $760M for an EV factory in Ohio. Meanwhile, speaking at a conference in September, CEO Mary Barra said the automaker plans to invest $2B in its Cruise project annually.
- Consensus EPS Estimates: $1.89
- Consensus Revenue Estimates: $42.17B
- Earnings Insight: General Motors has beaten EPS estimates in 7 of the past 8 quarters, rising above revenue expectations in half of those quarters.
Also reporting: Coca-Cola (KO), 3M Company (MMM), General Electric (GE), Halliburton Company (HAL), JetBlue Airways (JBLU), Kimberly-Clark Corp. (KMB), Moody’s Corporation (MCO), Archer-Daniels Midland (ADM), Biogen (BIIB), Cleveland-Cliffs (CLF), and United Parcel Service (UPS)
Wednesday, October 26
Boeing Co. (BA)
Boeing Co. (BA) is set to post its third quarter earnings prior to the market open on Wednesday. During the third quarter, the company settled with the SEC after “misleading investors” in relation to its 737 Max crashes. According to Bloomberg, the manufacturer is looking to offload hundreds of 737 Max jets to Asia-based airlines while the FAA continues to review safety paperwork.
Wall Street remains divided on the name, with Credit Suisse starting coverage of the stock at a Sell-equivalent rating on October 12 while Wolfe Research rated the stock at a Buy-equivalent the day prior. “Defense is a place you want to be when budgets are accelerating, and defense is a place you want to be into a recession…it’s not much more complicated,” Myles Walton, an analyst at the latter firm commented.
- Consensus EPS Estimates: $0.09
- Consensus Revenue Estimates: $18.11B
- Earnings Insight: Boeing has beaten EPS estimates only twice in the past two years, while exceeding revenue expectations thrice.
Kraft Heinz (KHC)
The Warren Buffett-backed Kraft Heinz is set to post its third quarter earnings report in premarket hours on Wednesday. Despite a disappointing longer term track record, the defensively oriented stock has significantly outperformed the broader market in 2022 with a modest gain contrasting starkly with an over 20% drop for the S&P.
Looking at Wall Street’s thinking headed into the report, Goldman Sachs said Kraft Heinz (KHC) is due to benefit from its lower mix of private label revenue. Meanwhile, the consensus of 20 analysts surveyed by Seeking Alpha remains broadly bullish on the name.
- Consensus EPS Estimates: $0.56
- Consensus Revenue Estimates: $6.26B
- Earnings Insight: Kraft Heinz has beaten EPS and revenue expectations in 8 straight quarters.
Also reporting: Bunge (BG), Canada Pacific (CP), Driven Brands (DRVN), O’Reilly Automotive (ORLY), Harley-Davidson (HOG), US Steel (X), Norfolk Southern Corp. (NSC), ThermoFisher (TMO), Wingstop (WING), Waste Management (WM), Hilton Worldwide Holdings (HLT), Bristol-Myers Squibb (BMY), and General Dynamics Corp. (GD)
Thursday, October 27
Amazon (AMZN)
Seattle-based retail giant Amazon (AMZN) will update investors on its quarterly performance after the market close on Thursday. In the 90 days prior to the earnings release, consensus EPS estimates have been revised down 35 times, according to Seeking Alpha data.
Looking back at the firm’s last earnings report, shares of Amazon (AMZN) marked a double-digit gain on the day after announcing its Q2 results. Financial figures were bolstered by a surge in net AWS sales from $14.8B in Q2 2021 to $19.74B in Q2 of 2022.
In October, a Prime Early Access event for the e-commerce segment Bank of America estimates that the company generated $8B in gross merchandise value for the two-day event, down from $10.7B in GMV for the same sales event held in July.
- Consensus EPS Estimates: $0.20
- Consensus Revenue Estimates: $127.78B
- Earnings Insight: Amazon has beaten EPS estimates in 5 of the past 8 quarters, rising above revenue expectations in 4 of those reports.
Credit Suisse (CS)
Troubled Swiss bank Credit Suisse (CS) will report its earnings results prior to the market open on Thursday. Prior to the print, Goldman Sachs advised that the bank could face a shortfall of up to $8B in 2024.
Meanwhile, Bloomberg has reported that the bank is currently preparing for a potential share sale as it seeks to restructure. Morgan Stanley and RBC Capital Markets are said to be assisting with the sale. The Bloomberg reporting added that Credit Suisse recently started marketing for sale the U.S. operations of its asset management business. The bank is also under investigation in the US for hiding client assets.
- Revenue estimate: $3.76B
- Earnings Insight: Credit Suisse (CS) has beaten revenue expectations in 4 of the past 8 quarters
Apple Inc. (AAPL)
Apple Inc. (AAPL), the most valuable company in the world, is due to post its earnings results after the market close on Thursday. While shares of the Cupertino, California-based company have fallen about 20% in 2022, the stock is essentially flat over a 12-month timeframe.
At the close of the third quarter, the iPhone manufacturer reportedly rejected a price increase proposal from Taiwan Semiconductor (TSM). The company is also reportedly trimming iPhone 14 production due to shortages of key components such as semiconductors. Elsewhere, Apple is expected to unveil the latest iteration of its iPad Pro tablet shortly before the release, according to Bloomberg.
According to Seeking Alpha data, 26 of 44 analysts rate the stock a Strong Buy while only one analyst assigned it a Sell rating. Indeed, the stock was named a “top pick” at Morgan Stanley only about a week prior to the Q3 earnings report. The bank’s channel checks suggested strength in China especially.
Still, the tech giant is reportedly seeking to open more operations in India rather than China. Along with much of the tech sector, Apple announced it would cut back on hiring in the third quarter in cost-reduction efforts.
- Consensus EPS Estimates: $1.27
- Consensus Revenue Estimates: $88.83B
- Earnings Insight: Apple has beaten EPS estimates in 8 straight quarters, missing revenue expectations only twice in that span.
Intel Corporation (INTC)
California-based semiconductor maker Intel (INTC) is due to report third quarter earnings after the bell on Thursday. Intel stock has been halved thus far in 2022, sliding alongside much of the semiconductor sector. Shares touched a 52-week low in mid-October as Bank of America warned of the company’s elevated exposure to China and faced risks in terms of export restrictions.
Elsewhere, Bloomberg reported that the chipmaker could announce significant staff cuts on earnings day. The layoffs are expected to hit the sales and marketing departments specifically.
Elsewhere, the company recently filed an S-1 to IPO its Mobileye subsidiary. At the high end of the prospective price range, Mobileye would be valued at about $16B.
- Consensus EPS Estimates: $0.14
- Consensus Revenue Estimates: $15.37B
- Earnings Insight: Intel has beaten EPS estimates in 5 of the past 8 quarters, rising above revenue expectations in 6 of those quarters.
Also Reporting: Ford (F), McDonald’s Corporation (MCD), Caterpillar (CAT), Southwest Airlines (LUV), Altria Group (MO), Anheuser-Busch InBev (BUD), Cameco Corp. (CCJ), International Paper (IP), Keurig Dr Pepper (KDP), Merck & Co. (MRK), Mastercard (MA), Shopify (SHOP), Textron (TXT), T-Mobile (TMUS), Pinterest (PINS), L3Harris Technologies (LHX), and Comcast Corporation (CMCSA)
Friday, October 28
ExxonMobil Corporation (XOM)
Rounding out earnings week, ExxonMobil (XOM), the most valuable US energy company, is due to offer its quarterly update prior to Friday’s open. Shares of the Texas-based oil giant have surged over 60% in 2022.
Despite a short retreat in September, an OPEC production cut and the release of U.S. government data that reflected a decline in domestic crude supplies ignited another rally for the stock into October. Ahead of the earnings report, Jefferies upgraded the stock to “Buy” based upon “attractive risk/reward, particularly for generalists needing energy exposure.”
In other news, Bloomberg recently reported that a “toxic work culture” is creating problems in employee retention at the company. The problem is particularly pronounced among scientists, engineers and technologists, according to the report.
- Consensus EPS Estimates: $3.79
- Consensus Revenue Estimates: $108.22B
- Earnings Insight: Exxon has exceeded EPS estimates in 7 of the past 8 quarters, beating revenue expectations in 6 of those reports.
Colgate-Palmolive (CL)
Colgate-Palmolive (CL) is also set to report its quarterly results in Friday’s pre-market hours. Shares of the manufacturer of household, healthcare and veterinary products have declined by a smaller margin than the broader market, although they remain depressed by about 15% thus far in 2022.
Recently, the Dan Loeb-led hedge fund Third Point has advocated that Colgate (CL) separate its Hill’s pets business. The hedge fund holds a $1B stake in the company. Loeb’s firm believes the spin-off could be worth as much as $20B.
- Consensus EPS Estimates: $0.73
- Consensus Revenue Estimates: $4.47B
- Earnings Insight: Colgate-Palmolive (CL) has beaten EPS and revenue estimates in 7 of the past 8 quarters.
Also reporting: Chevron Corporation (CVX), DaVita (DVA), AbbVie (ABBV), and Church & Dwight (CHD)
