With the major US indices trading at record highs, the coming week will mainly be dominated by earnings as some of the country's largest companies release their latest quarterly earnings.
Earnings estimates for the just completed quarter were up 7.3% from early April to $45.03 per share for the members of the Index headed last week, according to data collected by FactSet.
Despite bullish market sentiment, the spread of a highly contagious strain of coronavirus and the possibility of the Federal Reserve scaling back its monetary stimulus are some of the risks the ongoing rally in equities could thwart .
Below we've shortlisted three stocks from different sectors that we'll be watching as the Q2 earnings season kicks off:
1. JPMorgan Chase
Global lender JPMorgan Chase (NYSE:) will report its second quarter results on Tuesday, July 13, before the market opens. Analysts expect the Wall Street powerhouse to report $3.16, an equity gain on $29.96 billion in revenue.
The International Investment Bank is emerging much more strongly after the cause of the global pandemic, aided by its trade division and fees from its corporate and investment banking groups. JPMorgan Q2 gains come after the Federal Reserve issued a clean bill of health to major US banks last month, paving the way for lenders to increase their payouts to investors after June 30.
In a vote of confidence for banks including JPM and Goldman Sachs Group (NYSE:), the Fed said last month it would end temporary limits on dividend payments and share buybacks after all 23 companies had performed well in the annual stress tests.
JPM shares closed Friday at $155.77, following a strong rally this year so far. Shares are up 22% in 2021, handily beating the 16% expansion of the S&P 500.
2. PepsiCo
Snack and beverage giant PepsiCo (NASDAQ:) will also report the company's fiscal results for the second quarter of 2021 before market opens on Tuesday. Analysts expect an average of $1.53 per share in earnings on revenue of $17.97 billion.
During the pandemic, PEP from incarcerated consumers stocking snacks and beverages aided by its diversified portfolio of snack brands, such as Tostitos, Fritos, Ruffles and Cheetos.
In April, the company reiterated its 2021 forecast, which expects mid-single digit organic sales growth and high-single digit earnings per share in constant currencies. Pepsi forecasts strong sales from its North American beverage division as more consumers visit restaurants and movie theaters, but demand for Quaker Foods products is likely to decline.
PEP shares closed Friday at $149.48, up about 5% over the past three months.
3. Delta Air Lines
Delta Air Lines (NYSE:) will report its second quarter results on Wednesday, July 14, before the market opens. On average, analysts expect a loss of $1.36 per share on revenue of $6.14 billion.
The global airline industry is trying to make a comeback after one in which air traffic collapsed amid rising COVID-19 infections. Domestic air traffic in the US is recovering with the acceleration of the rollout of the coronavirus vaccine. During a webcast last month, Delta Air Chief Executive Ed Bastian said the airline would operate twice as many domestic flights in July as it did in May, but added that business travel, one of the most lucrative segments for carriers, is still very much was limited. Delta shares closed Friday at $42.92, after falling 13% in the past three months amid concerns that new strains of the coronavirus will continue to keep some travel segments depressed.
