X Here's your weekly Investing Action Plan: what you need to know as an investor for the coming week.
Markets will get a broader view of the economy as leading-edge companies in the tech, heavy industry, defense, energy and medical sectors have their turn at earnings. Microsoft (MSFT), Amazon.com (AMZN), Alphabet (GOOGL), Boeing (BA), Caterpillar (CAT), Exxon Mobil (XOM) and McDonald's (MCD) are among the big names due. They're followed by an even broader view of the economy on Friday, when an initial reading on Q1 GDP comes out. But results of the first round of France's presidential election on Sunday will set the tone for the week.
Stocks To Watch
Facebook (FB) is trading in new-high territory after gaining 3% for the week. While shares are well extended from their 129.37 cup-with-handle breakout, the stock is providing another buying opportunity. Facebook has successfully rebounded higher off of its 10-week line after testing that level in the prior week. That's providing an add-on entry, or could even be a signal to start a new position.
Apple (AAPL) has provided multiple buying opportunities. Shares are climbing higher after their own test of the 10-week line. And they're also holding above a four-weeks-tight entry of 141.12. But buyers beware: the stock is already extended about 20% from its January cup-with-handle breakout.
Visa (V) is another example of a stock pulling back to the 10-week line after a breakout. Fueled by its earnings report, shares hit a new all-time high Friday. However, Visa erased all of Friday's intraday gains in very heavy volume, which is not great action. Friday's move comes after the stock traded tightly just above the 10-week line for several weeks.
Shares are now extended 8% from their 84.06 flat base breakout in February.
French Face-Off
Centrist Emmanuel Macron and far-right candidate Marine Le Pen will go head to head in a May 7 runoff after taking the top two spots in Sunday's presidential election. Opinion polls have consistently shown Macron, who backs the EU, easily beating Le Pen, who is anti-euro, anti-immigrant and anti-Islam. The euro spiked to a five-month high on the election results. Investors of U.S. bank shares may breathe a sigh of relief at the prospect of some stability in the EU and eurozone, as some top lenders had planned to shift staff from London to Paris after last year's Brexit shock.
Solid Q3 Seen From Microsoft
Software giant Microsoft is predicted to report its best quarter for sales and earnings growth in over two years when it posts fiscal Q3 results on Thursday. Analysts expect Microsoft to earn 70 cents a share, up 13% year over year, on sales of $23.62 billion, up 7%, in the March quarter. Microsoft has been transitioning into a cloud computing services firm from a PC-server software company. Its tablet, as well as efforts in virtual reality and augmented reality, have also gotten attention recently.
Amazon Growth To Slow Further
With the stock trading near record highs, the e-commerce giant reports earnings after the close Thursday. Wall Street sees EPS up 6% to $1.13 and a 21% increase in revenue to $35.3 billion, marking what would be the third straight quarter of slowing top-line growth. Credit Suisse recently raised its price target on Amazon to 1,050 from 900, based on expectations of improved profit margins and a better outlook for Amazon's cloud-computing unit. UPS (UPS), which delivers many of Amazon's orders, reports before the market opens Thursday, potentially offering an early sign of Amazon's sales volume.
Mind The GAAP At Alphabet
Google-parent Alphabet reports Q1 earnings late Thursday. Management in January said it's moving to GAAP accounting, like some other internet companies. In Q1, analysts estimate 23% EPS growth to $7.40, with revenue rising 19.5% to $24.22 billion. An advertising flap at YouTube derailed a stock rally in March. While YouTube's Q1 revenue may take a hit, the online video site's growth is key as search revenue slows.
Big Earnings For Big Oil
Exxon Mobil and Chevron (CVX) will report quarterly results Friday. Analysts expect Exxon's EPS to soar 102%, to 87 cents, with revenue up 38.2%, to $67.3 billion. Chevron is expected to swing back to a profit of 92 cents per share from a loss of 11 cents a year ago. Revenue is seen jumping 48% to $34.9 billion. Last quarter, the oil majors announced capital budgets forecasts with plans to focus on U.S. shale plays, which have seen a surge in activity. As oil prices bounce around on mixed signals from OPEC on extending its output cut, see how the companies respond this time.
Aerospace, Defense Giants
On Tuesday, Lockheed Martin (LMT) kicks off a busy earnings week for the sector. Analysts expect the F-35 maker to report a 4% drop in earnings to $2.79 per share. But revenue is seen rising 8.4% to $1.24 billion. Results from Boeing, Northrop Grumman (NOC), United Technologies (UTX) and General Dynamics (GD) are on tap for Wednesday. Boeing is seen reporting a 10.9% increase in EPS, to $1.93, but a 5.7% drop in sales to $21.34 billion while Northrop's EPS is expected to fall 3.6%, to $2.92, but sales are seen up 2.3%. Raytheon (RTN), whose Tomahawk missiles were used in a recent strike on Syria, will report Thursday. Analysts expect EPS to jump 12.6%, to $1.62, and revenue to rise 1.2%, to $5.83 billion.
Economic Indicators
Friday's GDP report will be the highlight of the week's economic news. Readings for Q4 GDP were revised higher and last showed a 2.1% annualized gain, and the Atlanta Fed predicts a sharp slowdown in Q1 to just 0.5% growth. On Tuesday, the Case-Shiller home price index for February and new home sales for March come out. On Thursday, durable goods orders and pending home sales for March are due, and Friday will also see the Q1 employment cost index as well as the final reading of the University of Michigan consumer sentiment gauge for April.
Busy Week Ahead For Chipmakers
The week ahead will see earnings reports from a bunch of closely watched semiconductor companies, including chip giant Intel (INTC). Analysts expect Intel to earn 65 cents a share, up 20%, on sales of $14.81 billion, up 7%. It reports Q1 results on Thursday after the close. Intel is benefiting from strong demand for data center chips and a resurgent PC market. Texas Instruments (TXN) and Macom Technology Solutions (MTSI) are scheduled to report quarterly results Tuesday. Cavium (CAVM) follows on Wednesday with its Q1 results. Microsemi (MSCC) and Skyworks Solutions (SWKS) will report quarterly results on Thursday.
'Check Engine' Light Is On
Ford (F), General Motors (GM) and Fiat Chrysler (FCAU) report, as the auto industry faces a growing list of potential challenges: slipping auto sales after a long run-up; higher delinquencies, incentives and inventories; falling used-car prices as more leases end and more cars sit outside dealerships; questions about the viability of the subprime-loan market. Ford reports Thursday, and its EPS is expected to dive 47%, to 36 cents, as sales slip 1.6%, to $34.69 billion. GM, which reports Friday, is seen increasing EPS by 16%, to $1.46, on revenue of $40.519 billion, up 9%. Fiat Chrysler reports Wednesday.
Biotechs, Drug Giants
Biogen (BIIB) is expected to report $2.74 billion in sales and $5 adjusted earnings per share early Tuesday, two days before AbbVie (ABBV), Celgene (CELG) and Alexion Pharmaceuticals (ALXN) are set to offer their reports. All three will report early. For Q1, AbbVie is expected to report $1.26 adjusted EPS on $6.48 billion in sales. Analysts see Celgene reporting $3.04 billion in sales and $1.64 in adjusted EPS. Alexion's EPS is seen at $1.23 on $827.2 million in sales. Drugmakers Eli Lilly (LLY) and Novartis (NVS) are scheduled to report Tuesday. Analysts model $5.21 billion in sales and 96 cents adjusted EPS for Lilly, and $1.12 EPS ex items on $11.65 billion in sales for Novartis. On Thursday, analysts expect Bristol-Myers Squibb (BMY) to report $4.72 billion in sales and 74 cents EPS minus items.
Biding Time For Baidu Rebound
China's internet search giant reports Q1 earnings early Thursday. Analysts estimate EPS will fall 17% to 87 cents, with revenue flattish at $2.44 billion. Baidu (BIDU) lowered earnings and revenue guidance last year after the government cracked down on internet health care advertising following the death of a university student. But year-over-year comparisons should improve in the back half of 2017. One bright spot for Baidu has been its video streaming business, iQiyi.com.
AT&T Follows Verizon
The telecom behemoth reports Q1 earnings late Tuesday. Analysts estimate EPS will grow 3%, to 74 cents, with revenue flattish at $40.57 billion. AT&T (T) stock is down in 2017 amid fierce wireless competition and expectations that interest rates could rise. Rival Verizon Communications (VZ), also a high dividend payer, missed earnings estimates on April 20. AT&T aims to garner approval of its acquisition of media giant Time Warner (TWX) from the Trump administration
Mining, Equipment Heavies
Caterpillar, which is due to report before Tuesday's open, is expected to earn 62 cents a share, down from 67 cents a year ago. Revenue is seen slipping to $9.26 billion from $9.46 billion. Shares have been choppy amid an IRS investigation and doubts about federal infrastructure spending. Copper-mining giant Freeport-McMoRan (FCX) also reports early Tuesday and is expected to earn 18 cents a share vs. a year-ago loss of 16 cents, while revenue is seen dipping 0.3% to $3.52 billion. Copper prices have been holding up pretty well, but Freeport has been dogged by a dispute with Indonesia over an export license for the company's massive Grasberg mine.
Good Eats
Restaurant earnings abound in the week ahead. Analysts expect McDonald's earnings to rise 8% to $1.33 a share on a 7% sales drop to $5.51 billion when it reports Tuesday. Meanwhile, Chipotle (CMG) is seen swinging to a profit on Tuesday, and Buffalo Wild Wings (BWLD) reports Wednesday. On Thursday, Domino's Pizza (DPZ) is projected to log a 30% profit gain, to $1.16, on a 14% sales increase, to $615.5 million, while Starbucks (SBUX) is expected to post 15% EPS growth, to 45 cents, and 8% sales growth, to $5.41 billion.
PayPal Is In The Zone
PayPal Holdings (PYPL) reports Q1 earnings late Wednesday, and analysts project Q1 EPS of 41 cents, up 11% from a year earlier, with revenue rising 15.5%, to $2.94 billion. The payment processor aims to expand into mobile wallets and smartphones from online transactions. PayPal on April 18 announced a mobile partnership with Alphabet's Google. Shares are in a buy zone.
Chinese Educators
New Oriental Education (EDU) reports fiscal Q3 results early Monday, and Wall Street sees EPS increasing 32%, to 41 cents, as revenue grows 21%, to $419.7 million. Shares broke out last month and are nearing profit-taking sell territory. Peer Tal Education (TAL) reports fiscal Q4 numbers early Thursday, and analysts see EPS up 30%, at 30 cents, and revenue surging 65%, to $288.1 million. Shares have shot up more than 50% since late December.
