Earnings will take center stage for the next week as some of the largest US companies across industries report revenues for the first quarter of 2021.
As the US economic recovery accelerates after the successful rollout of COVID vaccines, investors will focus on inflationary pressures and whether they are squeezing operating margins.
So far, just a week later, according to Refinitiv, companies have surpassed estimated profit by a wide margin – more than 84%. Earnings growth for the so far is 30.2% for the quarter, based on current reports and estimates. That makes it the best three-month period since the third quarter of 2010, according to FactSet.
Building on profit optimism, all three major US indices continued their upward trend last week. The S&P 500 ended the week at an all-time high, gaining a fourth week and up 1.1% for the week.
Below we have shortlisted three stocks from different sectors. monitoring as the first quarter earnings season gets underway:
1. Netflix
Streaming entertainment giant Netflix (NASDAQ 🙂 will close on Tuesday, April 20 after the market to report first quarter revenues. Analysts expect earnings per share of $ 2.97 on sales of $ 7.14 billion.
Following the COVID-19 pandemic, Netflix stocks are losing some steam as subscriber growth slows and competition in the streaming market intensifies.
As of the end of Friday at $ 546.54, Netflix shares are up just over 1. % this year, compared to the 9% expansion of the tech-heavy NASDAQ over the same period. Next week's earnings report will be crucial if the stock is to break this slow cycle and rise higher.
Los Gatos, California-based company must demonstrate that it is well positioned to defend its dominance at a time when Disney's streaming service (NYSE 🙂 is receiving an overwhelming response from subscribers and other competitors – including Apple (NASDAQ :), Amazon (NASDAQ 🙂 and NBCUniversal (NASDAQ 🙂 – are slowly gaining ground.
2. Johnson & Johnson
Global healthcare giant Johnson & Johnson (NYSE 🙂 will also report its first quarter earnings before opening the market on Tuesday. According to analyst consensus forecast, the company could report $ 2.34 EPS on revenue of $ 22 billion for the period.
In addition to the quarterly figures, investors will be happy to learn more about the side effects of the drug company's COVID-19 vaccine, whose rollout in the US was halted this month after reports that a small number of recipients developed life-threatening blood clots. . On Friday, the company's scientists published a rebuttal to the claims in a letter published in the New England Journal of Medicine.
The Advisory Committee on Immunization Practices, or ACIP, said on Wednesday it doesn't have enough information. but about the risk of these unusual side effects to determine whether the vaccine should be continued, discontinued, or recommended only to certain populations, according to the Wall Street Journal.
Despite the vaccine relapse, J & J & # 39; s remains strong as the US reopen and hospitals will gradually increase elective surgeries after the COVID-19 disruption, which is affecting the company's device operations. 2020. Shares of J&J are up 3% this year. They closed at $ 162.24 on Friday.
3. Coinbase
After the successful direct listing last week, which gave cryptocurrency exchange Coinbase Global (NASDAQ 🙂 an opening valuation of USD $ 86 billion, it is share has now fallen.
] Yet it has become an important barometer in the burgeoning cryptocurrency market. Shares of the largest US exchange for trading digital currencies ended their first week as a publicly traded company in the green.
The stock closed at $ 342 on Friday after a 6% rise for the day. At that level, the stock is more than 30% above the reference price of $ 250, but much lower than the peak of $ 429.54 during the first few minutes of stock trading on Wednesday, April 14.
The stock exchange, with a current market cap of $ 68 billion, continues to receive favorable reviews from some Wall Street analysts. Loop Capital Markets analyst Kenneth Hill advised clients to buy stock from the exchange, emphasizing that there are "many runways" for the company before it "takes off."
Despite the risks ranging from increasing competition to volatility, some investors see opportunities in Coinbase. Bloomberg reported that Cathie Wood's ARK funds bought about $ 352 million worth of stock in two days in the expectation that the company could become a staple in money managers' portfolios.
