Although the winning season may end, some big names have yet to report, both this week and the following week. During Sunday's Bell Ringers podcast, we focused on five notable releases: Uber Technologies (NYSE :), CVS Health (NYSE :), Qualcomm (NASDAQ :), Roku (NASDAQ 🙂 and Disney ] (NYSE :).
This is what we look for during each report:
Monday, November 4:
1. UBER: Reports After Markets Close
Ride Sharing Service Uber has recorded an astonishing loss of $ 5.24 billion, of which $ 3.9 billion was related to employee compensation. These are staggering figures that have tested the patience of the market for losses.
Not very surprising, this quarter will probably be more of the same. This time, Uber is expected to report a quarterly loss of – $ 0.85 per share on revenue of $ 3.74 billion. What we will look at most is Uber's cash flow. Although the San Francisco-based company may not be in the bankruptcy area yet – it has $ 11 billion in cash of which it used around $ 2 billion in the first half of 2019 – but any sign that it is getting closer to becoming the cash flow positive , would alleviate investors' concerns.
Sales growth is also crucial. Uber's revenues have lost their explosive momentum, which in 2017 and 2018 was 106% and 42% respectively. Over the past three quarters, the service recorded revenue growth of only around 25% for the entire period.
Bullish thesis for the shares: sharing rides as a service requires proven profitability – something that has not yet been established; Uber Eats should show some growth (it lost 1.7% of the market share last quarter), and in fact Uber must hit all cylinders. That probably won't be the case. In the long term, we will therefore remain on the sidelines.
Wednesday, November 6:
2. CVS Health: Reports Before Markets Open
It has been a strange year for CFS, health care and the pharmaceutical chain. The stock has increased by only 2.5% YTD, but it has also increased by 28% since the beginning of March. The consensus expectation is that it will report sales of $ 63 billion on $ 1.77 earnings per share.
If that were to happen, it would mark the 30% + sales growth for CVS, and it would explain the dynamics of the stock since the March profit report.
CVS is also doing well when it comes to selling in the same store, perhaps the most important measure for store chains. Last quarter it reported a growth of 4.2% in the same store sales, driven by a growth of 7.2% in prescription volumes.
Bullish thesis for the stock : As a rule, health care shares depend on an aging American population that is highly medicated to thrive. That is not like & # 39; n distance shot. Moreover, the 3% dividend yield, paid quarterly, makes CVS a company worth considering if you want to diversify in healthcare.
3. Qualcomm: Reports After Markets Close
chip manufacturer Qualcomm gave disappointing guidelines. The stock fell to $ 68 after the release of the win. Wall Street then expected Q3 EPS to be $ 1.08, while Qualcomm led lower: EPS between $ 0.65 and $ 0.75. Surprise, the new expectations of Wall Street are a earnings per share of $ 0.71 on sales of $ 4.7 billion.
However, it is worth noting that despite much lower expectations, Qualcomm is now trading at $ 83, 10% above where it was before expectations were lowered. It is clear that in the short term markets can often misunderstand stocks – and do so
Bullish Thesis for the Shares: In the long run, it is difficult to bet against the market leader in 5G technology. Qualcomm has captured a place for its 5G modems in the next-generation Apple (NASDAQ 🙂 devices, and macro trends all work to their advantage.
4. Roku: Reports After Markets Close
If you can't handle volatility, don't even think of Roku. Shares of the company, which operates a TV streaming platform, jumped from $ 96 in August to $ 176 in early September, then dropped back to $ 98 at the end of September and then jumped back to $ 150 in October. This indicates Wall Street's lack of confidence in Roku's valuation model.
The annual sales growth of Los Gatos, CA company, is the important measure here. And the trend is positive right now. , Roku sales increased by 59%, the highest in the last four quarters. Revenue of $ 258 million is expected to be reported with a loss of – $ 0.28 per share. To be fair, the losses are negligible in comparison with sales growth.
Bullish Thesis for the Shares: Wall Street really likes revenue growth, so if Roku meets or defeats, expect a big swing after hours when Roku reports.
Thursday, November 7:
5. Disney: Reports After Markets Close
Just about all of Disney's profits this year (12% YTD) can be traced to a single day – April. 11, when the company announced the details of its streaming plans. This week's report does not include streaming earnings, as the service will not be launched until November 12, but management's expectations for streaming earnings are likely to overshadow everything else in the current report.
Consensus says Disney will generate $ 19 billion in revenue with a profit of $ 0.95 per share. If that happens, it would mean that profitability is deteriorating, not that anyone cares … anything is allowed if you are a potential streaming entertainment giant.
Media networking is the segment to watch. Disney & # 39; s subsidiaries ABC and ESPN are having a hard time cutting the consumer's cord, and while Disney will try to make up for it with its own streaming offering, media networks still represented 33% of Disney's revenue last quarter.
Bullish Thesis for the Shares: During the profit call, Disney management is likely to come up with preliminary Disney + sign-ups and ensure strong anticipated growth in subscriber numbers.
