The three major U.S. equity indexes tanked Monday, with the S&P 500 Index entering bear market territory after dropping 3.90%. The Nasdaq dropped by 4.68%, and the Dow Jones industrials closed down 2.79%. All three traded up by less than 1% early Tuesday. The Federal Reserve meeting begins Tuesday and ends with an announcement and press conference Wednesday afternoon. An interest rate hike of 0.50% is virtually guaranteed, with a raise of 0.75% on the table now as well.
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After markets closed Monday, Oracle reported quarterly results that beat estimates on both the top and bottom lines. Revenue guidance for the company’s current quarter was solidly higher than the consensus estimate. Shares traded up more than 9% Tuesday morning.

Lithium-ion battery recycler Li-Cycle topped the consensus revenue estimate by more than 30%. The adjusted EBITDA loss totaled $20.7 million. The stock traded down more than 3%.

Here is a look at four companies scheduled to release quarterly results Tuesday afternoon or Thursday morning. There are no notable earnings releases scheduled for Wednesday.

Commercial Metals

Recycler and metals fabricator Commercial Metals Co. (NYSE: CMC) reports second-quarter fiscal 2022 results first thing Thursday morning. The stock has added nearly 13% to its share price over the past 12 months. Since posting a 52-week high in mid-April, however, the shares trade down about 20.3%.

In January, the company announced that it would build a new steel micro-mill to serve customers in the Midwest, Northeast and Mid-Atlantic regions. Site selection has begun, and once that is completed, the company estimates a construction period of around two years.

Just nine analysts cover the stock, and five of them have a Hold rating. The other four rate the shares at Buy or Strong Buy. At a recent share price of around $36.80, the upside potential based on a median price target of $44.00 is 19.6%. At the high price target of $55.00, the upside potential is 49.5%.

For the company’s fiscal third quarter, analysts are expecting revenue of $2.25 billion, which would be up 11.8% sequentially and 21.6% higher year over year. Adjusted earnings per share (EPS) are forecast at $1.63, up 6.8% sequentially and 56.7% year over year. For the full 2022 fiscal year ending in August, CMC is forecast to report EPS of $6.42, up 82%, on sales of $8.47 billion, up 25.8%.

Shares trade at 5.7 times expected 2022 EPS, 7.7 times estimated 2023 earnings of $4.78 and 8.0 times estimated 2024 earnings of $4.62 per share. The stock’s 52-week range is $28.77 to $46.68. CMC pays an annual dividend of $0.52 (yield of 1.52%). Total shareholder return for the past year was 12.8%.

Jabil

Shares of manufacturing services provider Jabil Inc. (NYSE: JBL) dipped by 2.5% over the past 12 months, including a December spike to an all-time high. Since then, however, the shares are down about 21.3%. The company’s gross margin over the past four quarters is nearly 8%, and its EBITDA margin is nearly 6.9%. In the company’s prior quarter, both came in at 12-month highs. Jabil reports quarterly results before Thursday’s opening bell.

Of seven brokerages covering the stock, all have a Buy or Strong Buy rating. At a share price of about $56.10, the upside potential based on a median price target of $81.00 is 44.4%. At the high target of $90.00, the potential upside is about 60.4%.

Analysts are expecting fiscal third quarter revenue of $8.22 billion, up about 8.8% sequentially and 14.0% higher year over year. Adjusted EPS for the quarter are forecast at $1.62, down by 3.6% sequentially but up 24.6% year over year. For the full fiscal year ending in August, analysts currently estimate EPS of $7.22, up 28.8%, on revenue of $32.68 billion, up 11.6%.

Shares trade at 7.8 times expected 2022 EPS, 7.3 times estimated 2023 earnings of $7.65 and 7.0 times estimated 2024 earnings of $8.00 per share. The stock’s 52-week range is $52.43 to $72.11. JBL pays an annual dividend of $0.32 (yield of 0.57%). Total shareholder return for the past 12 months was negative 2.5%.

Grocery store operator Kroger Co. (NYSE: KR) has added more than 32% to its share price over the past 12 months. Shares posted a 52-week high in early April and have dropped about 18% since then. How well Kroger can stay ahead of inflation is a major question (as it is for all retailers). Its strength, though, is that people have to eat. Their focus on groceries has both Kroger and Albertsons far outperforming competitors Walmart and Target. Kroger reports quarterly results Thursday morning.
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Of 26 analysts covering the stock, 13 have a Hold rating. Seven rate the shares at Buy or Strong Buy rating, and six have assigned Sell or Strong Sell ratings. At a share price of around $50.30, the upside potential based on a median price target of $55.50 is 10.3%. At the high price target of $75.00, the upside potential is 49.1%.

Fiscal first-quarter revenue is forecast at $43.08 billion, up about 30.4% sequentially and 4.3% higher year over year. Adjusted EPS are tabbed at $1.27, up 40% sequentially and 6.7% year over year. For full fiscal 2023 ending in January, Kroger is expected to post EPS of $3.81, up 3.5%, on sales of $144 billion, up 4.4%.

The stock trades at 13.2 times expected 2023 EPS, 12.6 times estimated 2024 earnings of $3.99 and 12.1 times estimated 2025 earnings of $4.15 per share. The stock’s 52-week range is $36.77 to $62.78. Kroger pays an annual dividend of $0.81 (yield of 1.67%). Total shareholder return for the past year is 32.4%.

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Planet Labs

Since coming public in a SPAC merger last December, shares of Planet Labs PBC (NYSE: PL) have dropped by nearly 55%. That includes a share price jump of 68% between May 11 and May 27, following the company’s federal contract award for providing unclassified satellite imagery. The company reports quarterly results after markets close on Tuesday.

The “PBC” in the company’s name indicates that it is a for-profit corporation that is intended to produce a public benefit and to operate in a responsible and sustainable manner. Like virtually every other growth stock, Planet Labs requires patience and that is in short supply among investors these days.

Of eight analysts covering the stock, all have a Buy or Strong Buy rating on the shares. At a share price of around $5.10, the upside potential based on a median price target of $11.25 is 120.6%. At the high price target of $17.00, the upside potential is 233%.

Revenue for the first quarter of fiscal 2023 is forecast at $39.5 million, up about 6.3% sequentially. Analysts anticipate an adjusted loss of $0.13 per share, compared to a loss of $0.25 per share in the prior quarter. For the full fiscal year ending in January, Planet Labs is expected to post a loss of $0.48 per share, down from the year-ago loss of $1.70, on sales of $181.26 billion, up 38.1%.

Planet Labs is not expected to post a profit in 2023, 2024 or 2025. The company’s sales to enterprise value multiple for 2023 is 4.9. For 2024, the multiple is 3.4, and for 2025 the multiple is 2.0. The stock’s post-IPO range is $3.70 to $11.65 (prior to the IPO, the SPAC stock reached a high of $12.15 in November, after announcing the deal with Planet Labs).

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