With some of the largest US companies reporting their quarterly results next week, investors' focus will likely be fully focused on corporate America and the financial health of the leading companies.
Over the next five days, about a third of companies will release their most recent figures along with their outlook for the rest of this year, including tech giants like Facebook (NASDAQ:) and Amazon (NASDAQ:) and industry names, such as Boeing (NYSE:) and Caterpillar (NYSE:).
About 87% of the S&P 500 companies that have reported results so far this season have exceeded Wall Street estimates. according to data collected by Bloomberg, investors are betting that a strong economic recovery will continue to fuel corporate America despite the threat of higher inflation.
During this pivotal week for Q2 earnings season, we'll focus on three key tech mega-caps whose earnings could help clarify whether they are still benefiting from the pandemic-driven surge in demand that their stocks are heading for. record high pushed prices in recent months:
1. Tesla
Electric vehicle manufacturer Tesla (NASDAQ:) will report its second quarter after market close on Monday, July 26. Analysts expect $0.94 equity gain on $11.53 billion in revenue.
With its shares still in a declining cycle so far this year, the Palo Alto, California-based EV manufacturer faces mounting competitive threats from traditional automakers, signs of a potential sales slowdown in China and an ongoing semiconductor shortage. TSLA shares closed at $643.38 Friday, down about 8% for the year.
The short-term outlook for Tesla has improved after the company reported last month that it produced more cars in the second quarter than analysts had expected. That shows that the company has managed to solve supply chain problems that hurt traditional automakers.
The company's sales forecast for the remainder of 2021, and the demand situation in China, will be important details for investors to consider. like to be kept informed.
2. Apple
Apple (NASDAQ:), the maker of the popular and iconic iPhone, as well as computers and smart wearables, is slated to report its fiscal 2021, Q3 earnings on Tuesday, July 27 after the market closed. Analysts, on average, expect the company to post $1.01 and share gains of $73.3 billion.
Shares of Apple continued to rise this year after the stock delivered a stellar performance in 2020. Strong signs that sales of its flagship iPhone will remain strong this year will help propel AAPL higher in 2021. During its fiscal , iPhone sales increased by 66%. It was the first full period for the company's Model 12 to support 5G technology. Apple has also introduced new MacBook Pros, a Mac mini, MacBook Airs, new AirPods, new iPads and updated Apple Watches this year. take advantage of the work-from-home environment that drives consumer technology needs.
The stock gained more than 11% this year, after rising 80% in 2020. AAPL closed Friday at $148.56.
3. Microsoft
Another high-profile mega-cap technology company, Microsoft (NASDAQ:), also reports its fiscal profit for the fourth quarter of 2021 after the market closed Tuesday. The software and cloud computing giant is expected to achieve earnings per share of $1.91 on revenue of $44.13 billion, according to consensus forecasts.
If it gives any clues, Microsoft should show robust momentum, fueled by a wave of technology investment and the strength of its cloud computing and core Office product line. The Redmond, Washington-based software and infrastructure company is benefiting from increased demand for connectivity as people continue to work from home and communicate socially.
Also, investors expect that businesses and governments will continue to spend on their transition to cloud computing, which has been a key growth area for the company in recent years.
Growth in that division increased 50% in the third quarter as enterprise customers accelerated to the cloud during the pandemic, where they can store data and run applications over the Internet. MSFT shares closed at $289.67 on Friday, after rising 30% this year.
