Over the next week, which will be filled with a myriad of megacaps earnings reports, investors will get a new look at how deeply the COVID-19 pandemic is harming American business.
Over the past week, still under pressure from investor concerns, it fell by 1.3%, providing new evidence of serious damage to the US economy. Indeed, since last Thursday's report, 26 million workers have made unemployment claims as companies struggling to save money are cutting their workforce.
Despite the fear-filled environment, some important earnings reports will be released that investors cannot ignore. Our focus will be on three tech giants whose reports could help clarify whether their latest gains are warranted:
1. Alphabet
Alphabet (NASDAQ :), the parent company of Google will report Q1 2020 earnings on Tuesday, April 28, after the market closes. Expectations are average for earnings per share of $ 10.70 on revenues of $ 41 billion.
Shares of Google have remained because of concerns that the possible recession caused by the coronavirus will compel companies to reduce their spending on digital ads, which will do massive damage to this internet content and information. Google's stock closed at $ 1,276.60 on Friday, down 4% for the year, after rising more than 30% in 2019.
The global health crisis has particularly hammered the retail and travel sectors, and these are major advertising customers of Google.
"The entire global economy is hurting, and Google and Alphabet are not immune to the effects of this global pandemic," Chief Executive Officer Sundar Pichai wrote in a memo to employees cited by Bloombeg this month.
"We exist in an ecosystem of partnerships and interconnected companies, many of whom are in great pain."
2. Microsoft
One of Wall Street & # 39; s technical darlings, Microsoft (NASDAQ :), reports third quarter 2020 fiscal profit after market closes at Wednesday, April 29. The computer giant is expected to post $ 1.20 in earnings per share on revenues of $ 33.8 billion.
MSFT Weekly TTM
If the past provides clues, the technology giant should show that it is fueled by a surge in technology investments and the strength of its core Office products. Due to this strength, Microsoft's shares remained largely immune to the current crisis, gaining nearly 11% for the year so far. On Friday, the stock closed at $ 174.55 after rising 1.83% for the day.
Amid the economic uncertainty created by the coronavirus outbreak, Microsoft is taking advantage of the current & # 39; shelter in place & # 39; environment. It's a tech stock that benefits from the increased demand for connectivity as people work from home and communicate socially. In addition, investors expect companies and governments to continue to devote to their transition to cloud computing, which has been the company's main growth area in recent years.
3. Apple
Apple (NASDAQ :), the maker of popular iPhones and computers and smart wearables, will close on Thursday, April 30, after the market closes, report second quarter 2020 results.
AAPL Weekly TTM
The outbreak of and response to COVID-19 has posed several challenges to Apple, including disruption to China's manufacturing supply chain. In addition, for example, Apple's stores outside of China are closed until further notice, and many regions in the United States are under obscurity to know when restrictions will be relaxed.
Unit sales for iPhones will decline 36% year-over-year in a period when the global economy is hit by the pandemic before recovering to a decline of only 2% by the fourth quarter of this year, according to a Goldman Sachs forecast.
While Apple shares have risen 26% from a low hit last month, shares remain 14% below their peak in February. AAPL rose about 3% on Friday, closing at $ 282.97.
The company's massive innovation ecosystem and its huge wealth of money are some of the things that attract investors and keep them hopeful about the future of Cupertino, the California-based tech behemoth. The iPhone maker currently has about $ 207 billion in cash on hand, with about $ 108 billion in both short-term and long-term debt.
