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Earnings Previews: AMC Entertainment, Cloudera, Oracle, Carnival, Ballard Power
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A light week of earnings reports earnings is broken up by several interesting reports due over the next two days.
Tuesday morning’s results include a beat on earnings and revenues at Dick’s Sporting Goods that was dragged down by a weak outlook for the year ahead. The real battering was reserved for Stitch Fix, which reported a slightly narrower than expected loss Monday afternoon but a miss on revenues. Growth companies that miss revenue estimates are typically hammered, and Stitch Fix traded down nearly 30% Tuesday morning.
After markets close Tuesday, tax preparer H&R Block and speaker producer Sonos are scheduled to report earnings, with Campbell Soup and clothing retailer Express due out before markets open Wednesday.
Now we’ll take a look at five earnings results coming up Wednesday afternoon and Thursday morning.
AMC Entertainment
AMC Entertainment Holdings Inc. (NYSE: AMC) was among the big losers of 2020. The COVID-19 pandemic caused most theaters to remain closed for most of the year, and the impact on those businesses has been nothing less than awful. The stock plummeted more than 70% last year but has added more than 380% so far in 2021. Most of that year-to-date rise is the result of a short squeeze that sent shares rocketing by more than 800%.
Either anticipating more squeezing or the beginning of a return by paying customers, analysts remain bullish on the stock with three Strong Buy ratings and six Buy ratings. There are no Sell ratings, but six Holds. On Monday, analysts at Wedbush doubled their price target to $5 a share, while reiterating a Neutral rating. Of course, the stock has outrun its consensus price target of $2.86 and traded Tuesday morning at a high of $10.45.
When the company reports fourth-quarter results Wednesday afternoon, analysts are expecting a loss per share of $3.32 and revenue of $142.4 million. That’s a revenue drop of 90% year over year. For the 2020 fiscal year, the loss per share is forecast at $38.20 on revenue of $1.22 billion.
Shares traded up more than 11% Tuesday, in a 52-week range of $1.91 to $20.36. The company is not expected to post a profit in either 2021 or 2022.
Cloudera
Also expected to report results Wednesday afternoon is Cloudera Inc. (NYSE: CLDR). The data analytics and management firm saw its share price rise by nearly 20% last year, and shares have traded up another 4%, after rising more than 35% for the year to date before the tech stock selloff.
Since last September, Cloudera has enjoyed the equivalent of Buy or Hold ratings from seven firms, and the consensus price target is now $15.64, with the stock trading at around $14.50. That implies a potential gain of around 7.6% to the target, and a whopping 52% to the high target of $22.
Analysts are expecting earnings per share (EPS) for the company’s fiscal 2021 fourth quarter of $0.11 on revenue of $221.4 million. Those estimates represent a jump of 75% in EPS and 4.6% in sales. For the fiscal year, EPS is forecast at $0.41 (up from a loss of $0.13 last year) on sales of $864 million.
At the current share price, the stock trades around 35 times expected 2021 EPS, 30 times expected 2022 earnings and 25 times estimated 2023 EPS.
Oracle
Oracle Corp. (NASDAQ: ORCL) also reports Wednesday afternoon, following the $200 billion company’s share price gain of around 24% last year and a 13% gain so far this year. Its Cloud Infrastructure is beginning to gain some traction against competitors like Amazon, Microsoft and Alphabet, due partly to the halo effect of a contract with Zoom.
In addition to a Sell rating from Goldman Sachs, 26 other analysts rate Oracle stock a Buy or Strong Buy, with nine recommending holding shares. The shares trade above the consensus price target of $67.66 by about $5, but they trade with potential upside of more than 12% to the high target.
Analysts estimate fiscal third-quarter EPS of $1.11, an improvement of more than 14% year over year on sales of $10.1 billion, an increase of 2.8%. Those estimates are right around the midpoints of Oracle’s own projections made when it reported second-quarter results in December. For the full fiscal year, analysts are looking for EPS of $4.36 on sales of $40.1 billion.
The stock trades at around 17 times expected 2021 earnings, 16 times expected 2022 EPS and 14 times expected 2023 EPS.
Carnival
Like AMC, Carnival Corp. (NYSE: CCL), had a miserable 2020 due to the COVID-19 pandemic. Shares dropped about 57% in the year but have managed to tack on 24% so far in 2021 on hopes that vaccines and pent-up demand for cruises will get the company back on the right track. Carnival reports results before markets open Thursday.
As if to light a fire under the company, nine brokerage firms have a Strong Buy rating on the stock, and another six rate the stock as a Buy. Also, nine recommend holding the stock, and just one rates the shares at Underperform. Investors not wanting to be late to the party have pushed the shares to around $27, well above the consensus price target of $20.61. Yet, it may not be too late for those who believe in the high target of $33, which implies a gain of around 26% to the current trading price.
Analysts are looking for a fiscal 2021 fourth-quarter ending loss per share of $1.55 on revenue of $208.3 million, a decline of nearly 96% in revenue. For the fiscal year, estimates call for a net loss of $3.92 per share and revenue of $5.95 billion.
The cruise line operator’s stock traded at around 99 times expected 2022 earnings and 17 times expected 2023 earnings.
24/7 Wall St.Ballard Power Systems
Quarterly and fiscal year 2020 results from Ballard Power Systems Inc. (NASDAQ: BLDP) are expected before markets open Thursday. The hydrogen fuel cell maker posted a share-price gain of 226% in 2020 and had added another 75% or so, until the bottom fell out of the tech sector in early February.
The shares traded up more than 11% Tuesday morning, following the company’s announcement of an order for additional fuel cell modules for a customer in Northern Ireland. In the announcement, Ballard noted that it is the supplier for more than 85% of 295 hydrogen-powered buses to be deployed throughout Europe by the middle of 2022.
The relatively tiny hydrogen fuel cell maker boomed last year, along with electric vehicle makers. Ballard is rated a Buy or Strong Buy by most analysts and Hold by the rest. There is even some headroom for investors looking for more. The stock currently trades at around $23.50, about $10 below its consensus price target of $33.34. That implies a potential upside of 41% at the current share price. Using a high target of $42, the implied upside is 81%.
Analysts expect Ballard to report a quarterly net loss of $0.04 per share on sales of $30.2 million and a full-year loss of $0.19 per share on sales of $106.2 million. The quarterly loss is equal to the loss reported in the same period a year ago, and the annual loss is three cents a share worse than a year ago. Revenue is also forecast to be lower for both the quarter and the year.
Ballard is not expected to report an annual profit in its 2021 or 2022 fiscal years.
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