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Your guide to a week that includes Apple and Amazon
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It’s the busiest week of the earnings season, and it could have major consequences for the stock market. About 160 S & P 500 companies are slated to post their results, including Apple, Amazon and McDonald’s . Pfizer is also on deck. Through Friday’s close, more than 200 S & P 500 members had reported first-quarter earnings. Of those companies, 80% had beaten expectations, FactSet data shows. To be sure, tech giants such as Meta Platforms and IBM struggled after posting their latest numbers. Take a look at CNBC Pro’s breakdown of what’s expected from some of this week’s key reports. All times are Eastern. Tuesday McDonald’s is set to report earnings before the bell, followed by a call at 8:30 a.m. Last quarter: MCD missed on revenue as the conflict in the Middle East put pressure on the company’s top line. This quarter: The fast-food giant is expected to report single-digit earnings and revenue growth from the year-earlier period, LSEG shows. What CNBC is watching: McDonald’s comes into this quarterly report struggling, with shares down more than 7% year to date. Can it come out of its slump? Barclays analyst Jeffrey Bernstein thinks the Q1 report could mark an inflection point for McDonald’s. The analyst has a price target of $340, implying more than 20% upside, and an overweight rating. “MCD offers unique liquidity, size & scale within the industry, coupled with strong fundamental growth across the globe, and a return of significant cash, while maintaining relatively modest balance sheet leverage & significant real estate ownership, the latter generating outsized rental income, which we believe is underappreciated,” Bernstein wrote in a note April 19. What history shows: McDonald’s earnings have beaten expectations for eight straight quarters, according to Bespoke Investment Group. However, they are normally flat on earnings days. Coca-Cola is set to report earnings in the premarket. Management is slated to hold a call at 8:30 a.m. Last quarter: Higher prices led to better-than-expected revenue for KO . This quarter: Coca-Cola’s earnings and revenue are expected to stay little changed year over year, according to LSEG. What CNBC is watching: Organic sales growth will be the key metric to watch for. JPMorgan’s Andrea Teixeira expects a 4.9% expansion from the year-earlier period. However, that’s below a consensus of 7%, the analyst said. She also said the company “faces a relatively tough comparison on gross margins as last year as there was about 70 bps of more discrete benefits within cost of sales that will be lapped, although we still see solid margin expansion working though the puts and takes.” Teixeira has an overweight rating on shares. What history shows: Coca-Cola has a strong track record of topping analyst earnings estimates with a 72% beat rate, per Bespoke. That said, shares average only a 0.1% advance on earnings days. Amazon is set to report earnings after the close. A call with corporate leadership is set for 5:30 p.m. Last quarter: AMZN posted better-than-expected earnings as revenue jumped 14% year over year. This quarter: The e-commerce giant is expected to report more than 160% earnings per share growth from the year-earlier period, per LSEG. What CNBC is watching: Amazon shares have been on fire year to date, rallying 18%. Telsey analyst Joseph Feldman expects that momentum to carry on when Amazon reports earnings. “We expect continued double-digit sales and profit growth in 1Q24 — reflecting the strength of online spending, gains from expanded merchandise and faster fulfillment, and stabilization (and growth) of AWS,” wrote Feldman, who has an outperform rating and $200 price target on the stock. What history shows: Bespoke data shows Amazon has exceeded earnings estimates for four straight quarters. Shares have also posted sharp gains in three of those four earnings days. Wednesday Pfizer is set to report earnings before the bell, with a conference call expected at 10 a.m. Last quarter: PFE beat earnings expectations as the company’s Covid business performed slightly better than expected. This quarter: The pharma giant is forecast to report steep earnings and revenue declines from a year prior, according to LSEG. What CNBC is watching: Pfizer shares have been under pressure this month, losing more than 8%, even after the company’s respiratory syncytial virus vaccine showed potential to protect high-risk adults ages 18-59 , and the Food and Drug Administration approved its gene therapy for a rare inherited inherited bleeding disorder . Can this report help turn things around for the struggling pharma giant? What history shows: Pfizer earnings beat earnings expectations 87% of the time, per Bespoke. That said, the stock has dropped in three of the past four earnings days. Thursday Apple is set to report earnings after the bell. Management is slated to hold a call at 5 p.m. Last quarter: AAPL fell after the tech giant’s outlook pointed to weakening iPhone sales . This quarter: The tech giant’s earnings are forecast to have fallen slightly year over year, LSEG data shows. What CNBC is watching: The struggling member of the Magnificent Seven goes into the report with questions around its artificial intelligence efforts and increasing competition in China. Last week, UBS said Apple’s smartphone market share in China has fallen about 3.6% year from the prior year, while the iPhone sell-through rate — the percentage of phones sold by retailers — dropped 13% in March from the previous month. What history shows: Apple has beaten earnings expectations for four straight quarter, Bespoke data shows. However, shares have fallen in three of the last four earnings days, including a 4.8% decline.
