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We’re halfway there. Approximately 50% of S&P 500 companies have released earnings reports and the results have been mixed. According to FactSet, only 69.7% exceeded expectations. This is below the three-year average of 79%, according to The Earnings Scout. There were several big surprises including Microsoft and Meta Platforms. However, Apple and Alphabet, Google’s parent company, reported quarterly misses. The second half of the reporting season begins this week, with 87 S&P 500 companies ready to report. These include Disney and the Chipotle Mexican Grill. Here’s a breakdown of what to expect from these two reports, as well as other key names. Chipotle Mexican Grill will report earnings Tuesday after the call, followed by a 4:30 pm ET call. Last Quarter: CMG posted better-than-expected results as higher ticket prices offset weaker customer visits. This Quarter: Analysts polled by Refinitiv expect earnings per share to jump nearly 60%. They also forecast a double-digit increase in revenue. What CNBC reporter Amelia Lucas observes: “In recent quarters, the biggest question for Chipotle has been how strong the price power of the burrito chain is. fell in the third quarter. Will the trend change or get worse? The chain recently announced that it is looking to increase its workforce by adding 15,000 restaurant-level employees, a sign that demand can remain solid despite inflationary pressures.” What history shows: Data from the Bespoke Investment Group shows that Chipotle’s earnings beat expectations 76% of the time and average 1.7% per profit day. The company also reported higher-than-expected earnings for seven consecutive quarters, according to FactSet. On Wednesday, CVS Health will report pre-opening earnings and management will hold a conference call at 8:00 AM ET. Last Quarter: CVS raised its forecast and reported quarterly revenue that beat all expectations. This Quarter: The company’s revenue is expected to change little from the previous year, while earnings are expected to decline slightly, according to Refinitiv’s forecasts. What CNBC is watching: In early January, CVS said it expects Medicare Advantage enrollments to grow by mid-single digits in 2023. note last month. Updates on this front can cause stocks to swing positively or negatively. What history shows: CVS earnings per share have beaten analysts’ expectations for 27 consecutive quarters, FactSet data shows. Yum Brands is set to report earnings before the call, followed by a conference call at 8:15 AM ET. Last Quarter: YUM reported weaker-than-expected earnings as strong growth in US dollar sales was offset by KFC and Taco Bell. This Quarter: Analysts expect profits to jump more than 20%, Refinitiv data show, but only marginal revenue growth forecast. What CNBC restaurant reporter Amelia Lucas observes: “The restaurant company that owns KFC, Taco Bell and Pizza Hut is expected to report strong sales in the US, but the focus will be on its international performance. Competitor McDonald’s said European markets are performing better than expected. Investors will also be watching for news as China, KFC’s biggest market, bounces back after the government eased its zero Covid policy.” What history shows: Individual data shows that Yum Brands beat profit estimates 82% of the time. However, according to FactSet, the fast food company reported four straight quarterly misses. Uber Technologies is set to report earnings before the call, followed by the call at 8am ET. Last Quarter: UBER reported higher revenue and issued strong guidance, sending shares up 11%. This Quarter: The ridesharing giant is expected to report more than 40% year-over-year revenue growth, according to Refinitiv. What CNBC is watching: While Uber’s revenue is expected to skyrocket, investors will be looking for clues as to how far the company has come to become profitable. “We estimate a CAGR of 20% for Bookings between 2022 and 24 and a 3%/4% upside potential over 23/24 based on the underlying assumption that UBER is simply maintaining existing share. market sharing / delivery from restaurants. We also look forward to further progress. to $5B+ in 24Y EBITDA, which should boost confidence in long-term profitability,” Jefferies analyst Jon Colantuoni wrote in a Jan. 29 note. What history shows: According to Bespoke, Uber averages a profit of 1.12% despite only outperforming estimates 47% of the time. However, shares fell after two of the last three quarterly reports. Disney is set to report post-closure earnings. Corporate management is due to hold a meeting at 4:30 pm ET. Last Quarter: DIS reported misses in revenue and key revenue segments. The company also warned of a slowdown in streaming growth. This Quarter: The media giant is expected to report a sharp year-on-year drop in earnings per share, Refinitiv data shows. What CNBC Entertainment reporter Sarah Whitten observes: “While shareholders will continue to play a key role in how many subscribers a set of Disney streaming services will add during the Q1 financial report, the focus of Wednesday’s report will be the return of CEO Bob Iger. His recovery coincides with a bitter proxy battle with activist investor Nelson Peltz and follows a tough year for the company’s stock as skyrocketing streaming spending and a small slate of theatrical releases ate into profits. This is Iger’s first earnings call since early 2020, and his words will set the tone for the future of the media company.” What history shows: Individual data shows that Disney beats earnings-per-share estimates almost 80% of the time. However, according to the data, the stock’s daily returns are muted. Shares fell 13% on the last reporting day. Thursday, PayPal is due to report earnings after the close of trading, followed by a call at 5:00 pm ET. Last Quarter: PYPL declined due to fourth quarter earnings forecast. This Quarter: PayPal’s revenue and earnings are expected to rise slightly from the previous year, according to Refinitiv data. What CNBC is watching: Investors will be looking for clues as to whether the payments giant can maintain its market share. “We believe the most important numbers for the upcoming press will be the Q4 2022 figures released in the US. [total payment volume] growth where we think the bogey is ~4% yoy (the lower end of the averages published by eComm in the US),” wrote Deutsche Bank analyst Brian Keane. What history shows: PayPal’s earnings beat analysts’ expectations in nine of the last quarters in Factset.
Credit: www.cnbc.com /
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