2019-11-11 • Updated
The earnings season is in a full swing in America. Every day the largest US companies are releasing their financial statements. This leads to big moves of stock prices. You can now trade these stocks with FBS (learn more).
During the upcoming days there will be several earnings reports we would like to focus on:
Jan 18 - Netflix
Jan 22 - IBM
Jan 23 - Ford Motor
Jan 24 - Intel
Below you will find the forecasts for these companies’ earnings accompanied by the fundamental and technical analysis for the stocks.
Netflix
EPS forecast: $0.25
Revenue forecast: $4.21B
The company will release its earnings report at 02:00 a.m. MT time on January 18.
Notice that as Netflix is a subscription service for watching TV episodes and movies, the number of its subscribers will another important indicator to watch apart from EPS and revenue. Usually, subscriber figures for Q4 tend to be good.
Moreover, pay attention to the company’s guidance for Q1. Netflix has recently increased prices for the United States, so traders will want to see how the company estimates the potential impact of this step. Prices were increased as Netflix has a lot of debt and craves cash. Investors will also want to know what are the spending plans on content, marketing, and development; how Netflix plans to conquer the Asian market; how the company is going to deal with the negative impact of the strong USD.
The stock is trading at the highest price since October. That month the company released a good report and outlined solid prospects. Now the price returned to the levels of that time.
The majority of analysts have positive expectations, although the stock looks a bit overbought. There’s a gap on D1 and 200-day MA at 339.40 as support. Resistance is at 378.00.
IBM
EPS forecast: $4.85
Revenue forecast: $21.8B
International Business Machines had a difficult period behind: its year-over-year revenue has been declining for 22 quarters in a row. Then there was a gleam of hope: 3 better quarters. However, the improvement was mainly due to the favorable exchange rate and the active refresh cycle for IBM machines. The impact of these positive factors will likely diminish.
The forecasts listed above represent the expectations of worse results than those of the previous quarter. Investors will want the company to reassure the market that its revenue will soon start rising.
The stock has started 2019 with a recovery, although it's still far below last year's highs. Resistance is at 124.20 and 129.30. The nearest support lies at 119.25.
Ford Motor
EPS forecast: $0.33
Revenue forecast: $38.72B
The company is trying to prepare the market for a negative outcome. It admitted on Wednesday that its Q4 earnings will likely be lower than expected by Wall Street. According to Ford, EPS will be around $0.30. At the same time, the company sounded optimistic about its prospects in 2019.
Nevertheless, it’s necessary to take into account the global economic growth slowdown and trade wars between the United States and China: these things make the automobile suffer, so despite the optimism, the year is going to be rather challenging for Ford.
The stock is in a downtrend. Support lies at 8.05 and 7.50.
Intel
EPS forecast: $1.22
Revenue forecast: $19.02B
Intel has managed to achieve strong results in Q3. The company works at the markets which are growing fast and have a big potential (self-driving cars, cloud computing, the Internet of Things, artificial intelligence). The range of products is wide and this makes less intimidated by trade tensions. In November, the company announced that it will increase its stock repurchase program — a sign that it’s quite confident in its own future. All in all, Intel seems to be a good pick.
The stock remains far below the 52-week high (57.66). A rise above 49.15 will open the way to 50.60 and 53.30.
China has issued new oil product export quotas to allow oil companies to send surplus barrels overseas, particularly Sinopec, which has the highest volume among quota holders. While the exact quota volume remains undisclosed, oil companies are forecasted to export approximately 3.5 million metric tons of clean oil products in September, a 10% increase from August.
Thanks to the incredible advancements in horizontal drilling and fracking technology, the United States has experienced a mind-blowing shale revolution. They've become the heavyweight champion of crude oil production, leaving Saudi Arabia and Russia in the dust. They even turned the tables and became net exporters of refined petroleum products in 2011.
Oil prices rebounded slightly on Friday but are still expected to show losses for the week due to concerns about slowing growth in the US and China. US crude futures rose 2.7% to $70.41 per barrel, while the Brent contract increased by 2.5% to $74.33 per barrel.
The past several weeks have been a real triumph for the bulls in the oil market. The Brent spot price grew by 8.5% during the last month.
Gold prices are rising for three consecutive days ahead of the Federal Reserve (Fed) interest rate decision, which is expected to remain unchanged due to declining inflation and a positive economic outlook. Investors are keen on the Fed's interest rate guidance, fearing a hawkish stance that could trigger market risk aversion.
Amid concerns of a Chinese economic slowdown, reports of declining investment often overlook China's efficient investment strategy in emerging sectors for long-term growth. China has taken measures to stabilize foreign and private sector investments, like reducing the reserve requirement ratio to boost investor confidence.
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