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Market Shapers Unveiled: Unpacking Key Earnings Reports


Robert Tavares

April 21, 2024 - 11:57 am


Earnings Extravaganza: Fates of Tech Giants and Auto Pioneers to be Unveiled

The upcoming week is set to be a pivotal one as corporate giants spanning the technology, automotive, and food sectors prepare to unveil their latest earnings. Investors will be glued to their screens as approximately 30% of S&P 500 companies reveal their financial performances.

Titans of Industry: Meta, Tesla, GM, and More in the Spotlight

In what could be described as the financial world's spotlight week, household names like Meta Platforms, Tesla, and General Motors are poised to disclose their fiscal health amid a fluctuating market. The unveiling of earnings comes at a time when the current financial landscape has painted a mixed picture—over 73% of reporting companies have surpassed analyst expectations, yet year-over-year growth for Q1 appears static. Growth projections initially exceeding 3% now face headwinds, as detailed by FactSet.

Pre-market on Tuesday, General Motors (GM) is expected to announce its earnings, an event that continues to garner significant attention. According to last quarter reports, GM not only surpassed Wall Street's profit predictions but also put forth a robust guidance for 2024. As per data from LSEG, this quarter may witness a modest dip in earnings compared to the previous year. Michael Wayland, CNBC's automobile expert, suggests that GM could deliver sturdy, if not "resilient," results, primarily fueled by higher-than-expected vehicle pricing at the year's start, echoing sentiments from recent analyst notes. Investors, aside from earnings, are on the lookout for any bullish signals regarding GM's annual guidance or even a nudge towards upper-bound targets previously declared.

Investors are also tuning in to Tesla's post-market earnings disclosure, followed by a management call. The electric car juggernaut rolls into this report amidst a troublesome year, with shares plummeting more than 40%. There's speculation of a notable earnings drop—nearly 40% year-on-year—as per LSEG analytics. Deutsche Bank's Emmanuel Rosner has spotlighted Tesla with a downgraded recommendation, from buy to hold, amid concerns over the brand's strategic direction away from budget-friendly models towards a robotaxi-focused venture.

The Aerospace Cornerstone: Boeing's Challenging Horizon

Come Wednesday, Boeing's premarket earnings announcement will be dissected by investors and analysts alike. With revenue forecasts anticipating over an 8% decline, per LSEG data, the aerospace stalwart stands at a tricky juncture. Last quarter's hesitation to set a 2024 guidance, following the CEO's admission of the Max 9 setback, has not helped fortify confidence. Mounting issues, including a whistleblower's safety warning on the 787 Dreamliner and the CEO's looming 2024 departure, paint a backdrop for a critical earnings announcement that many hope could signify a turnaround.

The Fast-Casual Favorite: Chipotle's Sizzling Prospects

Chipotle Mexican Grill, announcing post-bell with a subsequent leadership call, is riding a wave of positive sentiment. Their recent performance, bolstered by strong diner traffic, could herald robust double-digit growth in both earnings and revenue as indicated by LSEG. BTIG analyst Peter Saleh remains confident in the brand, sustaining his buy rating and ambitious price target of $3,250.

Ford's Fork in the Road

On the automotive front, Ford Motor trails General Motors to report post-close. With earnings poised to topple by over 33% from the previous year, based on LSEG interpretations, the focus turns to how the Detroit giant will handle the onslaught. Ford, unlike its rival, navigates more turbulent waters, marred by warranty and recall expenses alongside hefty electric vehicle losses. Investors are hopeful for positive news on these fronts, coupled with updates on CEO Jim Farley's 'Ford+' restructure plan, vehicle lineup revisions, and production strategies.

Tech Behemoths Meta and Alphabet: A Mixed Bag of Expectations

Meta Platforms shares have spiked roughly 36% this year, generating considerable optimism around their upcoming post-closing bell earnings call. Analysts forecast a compelling near-100% earnings per share hike, with Citi's Ronald Josey recently inflating his price target to $590. Attention is directed at new ad formats and features that are believed to strengthen Meta’s market foothold, especially in reel ads and engagement.

Another tech titan, Alphabet, braces for a post-bell report on Thursday. All eyes will be on the tech mammoth for any revelations regarding AI advancements; especially as Bloomberg reported potential licensing discussions around Gemini AI tools with Apple. With an earnings boost of about 30% on the horizon, Alphabet seeks to recoup from its two most recent earning day losses.

Microsoft's AI-Enhanced Ecosystem

Rounding out the week's tech saga, Microsoft is expected to tout a 10% hike in earnings and revenue from the corresponding previous year. Microsoft 365's Copilot AI assistant has successfully carved its first full quarter's imprint, and investors are eager for insights into uptake and its contribution to Azure's growth. With eyes on a rebounding PC market, the tech giant could witness bolstered Windows sales.

For the mentioned companies, history as recorded by Bespoke Investment Group, offers a varied tapestry of past performance success rates on earnings estimates with a mix of resultant share price reactions on earnings days—as high as 87% success for GM and as low as 63% for Tesla.

Investment Outlook: Riding the Earnings Wave

As the markets navigate through another earnings season, investors and analysts alike are on the lookout for signs of resilience amidst economic headwinds, as well as opportunities for innovation and growth. These upcoming earnings reports could act as a bellwether for the broader economy and signal shifts in investor sentiment across these diverse sectors.

For detailed insights on the upcoming earnings reports, readers may explore CNBC Pro's thorough analysis and backdrop for applicable Eastern time schedules here.

The anticipation among stakeholders is palpable. It is not simply about the numbers that will be revealed but what the figures represent in terms of strategic direction, market challenges, and future potential. As such, these earnings announcements are not the conclusion of quarterly performance but rather a commencement of what's to come in the global narrative of these industrial mainstays.

In conclusion, the coming week is set to be an earnings extravaganza, a rollercoaster ride through Wall Street's rigorous scrutiny, and it has all the trappings of an economic thriller that could define market dynamics in the time ahead.

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