Round Two of Earnings Season
It’s that time of the quarter again. The markets are receiving earnings reports from hundreds of companies, staring down expectations and actuals, a top-line and a bottom-line, a beat or a miss.
AstraZeneca, for one, doesn’t have net profit to print. It has vaccine data to share on Monday with Oxford University, a report to confirm or deny that trial data is strong. Astra’s shot is in final-stage testing, so not long now until markets are catalyzed by the widespread availability of a vaccine.
On Tuesday, investors will find out if Snap can outperform as advertisers boycott Facebook and spend more on Snapchat. Texas Instruments will have to settle nerves in the market following the merger of its two competitors, Analog and Maxim, and Coca-Cola’s post-earnings move will offer insight into how passive, risk-off dividend investors are thinking.
On Wednesday, expect noise. Tesla’s reporting. The most expensive car-maker in the world aims to prove that under the bonnet, it’s really that valuable. The markets are looking for stocks with blue-sky potential and Elon Musk knows how to inspire. The numbers themselves won’t even matter with this one. It’s about whether Musk is in a storytelling mood.
On Thursday, Union Pacific. This is a railroad, and railroads are a great bellwether for economic activity. You need to jump in at the point of maximum pessimism, as they fall the most in market crashes, but rise the most during the earliest stages of a recovery.
The airlines will deliver more pain on Thursday, no doubt, Twitter also shedding light on its massive cyberattack, but a quiet Friday will allow investors time to take stock of new information.
It’s normal to see reporting stocks move double-digits overnight, and there some investors want no part of that madness. It is a gamble, as analysts’ expectations don’t necessarily signpost the wider market’s expectations, but if you’ve bought a stock and believe its future is bright, the earnings releases can be key moments when the story of the stock gets told! Are you sitting in, or out?
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.