Upcoming Week: Major Earnings Reports & IPOs

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With the continuous spread of the virus, the stimulus package proposed by President-elect Joe Biden brings hope to the ever-volatile stock market. Even though the market will be closed on Monday due to Martin King Jr.’s birthday, the following four days will be packed with the release of quarterly earnings reports, IPOs, and new data disclosures.

Earnings Reports

The major companies releasing their Q4 earnings results include Netflix, Intel, and Schlumberger.

Netflix

The streaming giant Netflix has been the center of attention since the pandemic caused its subscriptions to rocket. Netflix will release Q4 results on Tuesday after the closing bell. Wall Street expects earnings of $1.32 per share on revenue of $6.62 billion.

The Los Gatos, CA-based firm showed a declining number of subscribers in its last quarterly report. Only 2.2 million paid subscriptions were added in Q3 as compared to 6.8 million added in the same period last year. Yet, the company was able to exceed analysts’ estimates of revenue of $6.39 billion – earning $6.44 billion. However, for the third consecutive quarter, EPS fell below estimates, reaching only $1.74 when Wall Street expected $2.13.

The share price of Netflix has declined 8% in the last three months while the S&P 500 index has gained 8% in the same period. Moreover, Netflix’s rivals including Disney+, Hulu, and HBOMax, have been gaining subscribers. The stock closed at $497.98 Friday. If Netflix is able to meet analysts’ estimates for this quarter, it could be a turning point for its stocks that have been stuck in a sluggish cycle.

Intel

Multinational chipmaker Intel will have investors’ eyes after it announced last week about its new CEO, at a time when its dominant position is uncertain. Intel revealed that Bob Swan, the existing CEO, will be replaced by Pat Gelsinger, VMware’s CEO. Gelsinger will be returning to Intel after he left over a decade ago.

Intel will post quarterly results on Thursday after the market close. Wall Street expects a profit of $1.1 per share on sales of $17.46 billion. However, investors will be keener to learn how the new CEO makes the company to defend its leading position in the challenging chip industry. The semiconductor giant has failed to innovate new products and has lost huge customers like Apple who now produces its own chips.

For the shares, they have performed relatively poorly as compared to rivals. In the past year, the stocks have not changed much while the Philadelphia Semiconductor Index has gained around 60% in the same period. Intel shares closed at $57.58 Friday.

Schlumberger

The leading oil services company Schlumberger will reveal Q4 results on Friday before the market opens. Analysts forecast a profit of $0.17 per share on revenue of $5.23 billion. The oil services giant works in over 120 countries, providing services like exploration and production. However, as the pandemic arrived, big oil companies tried to reduce spending to build up cash reserves.

Yet, Schlumberger stocks have added over 50% in the last three months as investors hoped for the global economy to recover with the development of the vaccine. The shares closed at $24.91 Friday as compared to $14 in October.

More IPOs This Week

The IPO division will remain active as companies including Dream Finders Homes, Patria Investments, and Qualtrics, launch new IPO pricings. The biggest IPO is expected to be by the e-commerce firm MYT Netherlands.

MYT Netherlands

The Munich, Germany-based company is the parent company of Mytheresa, a thriving luxury e-commerce platform founded in 2006. According to Renaissance Capital, the online firm seeks to raise $266 million by offering 15.6 million American Depository Shares at a price range of $16 to $18. Last week, the re-commerce store, Poshmark, raised around $277 million through its IPO.

 

The pet retailer Petco and online platform Poshmark are set for their second week after making big first day gains that were cut a little on Friday.

Source Seeking Alpha Money & Markets Investing.com

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