The three major U.S. equity indexes closed mixed Thursday. The Dow Jones industrials dropped 0.26%, the S&P 500 slipped by 0.08%, and the Nasdaq rose by 0.41%. Seven of 11 sectors ended the day higher, led by tech (0.5%), consumer cyclicals (0.4%) and communications services (0.4%). The energy sector tumbled by 3.7%.

Before markets open Friday morning, the U.S. Department of Labor reported that nonfarm payrolls increased by 528,000 in July, more than double the consensus estimate and well above the revised June total of 398,000. The headline unemployment rate fell from 3.6% to 3.5%. All three major indexes traded lower in Friday’s premarket session, as inflation fears rise once again as investors see little chance that the Federal Reserve will ease up on interest rate hikes.

After markets closed on Thursday, AMC posted a smaller-than-expected loss and fell short of the consensus revenue estimate. The company announced a special dividend consisting of one preferred, convertible share for each common share. The preferred shares will trade on the New York Stock Exchange under the ticker symbol APE. Shareholders were not amused; the stock traded down more than 8% in Friday’s premarket.

Block beat estimates on both the top and bottom lines, but the Bitcoin fiasco forced the company to take an impairment charge of $36 million. Bitcoin revenue fell 34% year over year to $1.79 billion. Shares traded down by about 6.6%.

Virgin Galactic reported a loss per share that was larger than forecast and revenue fell 37.5% year over year. The really bad news is that resumption of commercial flights has been pushed into the second quarter of next year. Shares traded down more than 18%.

Warner Bros. Discovery missed on both the top and bottom lines, and the misses were not even close. The stock traded down about 13%.

Before markets opened on Friday, Canopy Growth reported a much larger loss per share than expected after taking a non-cash impairment charge of $1.36 billion. Shares traded down about 6% in the morning.

DraftKings posted a smaller-than-expected loss and beat the consensus revenue estimate. The company also issued guidance that was in line with expectations. The stock traded up about 3.2%

Western Digital beat the consensus earnings estimate and missed on revenue. The company also issued downside earnings and revenue guidance far short of the consensus estimate. Shares traded down nearly 7%

First thing Monday morning, Barrick Gold, Palantir, Tyson Foods and Viatris are expected to report quarterly earnings.

Here are previews of four earnings reports due out after markets close Monday or before they open on Tuesday.

GlobalFoundries

Chipmaker Globalfoundries Inc. (NASDAQ: GFS) came public in late October of last year, and shares soared 70% by late March. By July 1, the stock had dropped 50% from its peak. The shares have gained 38% since then and currently trade with a gain of more than 15% since the IPO. In large part, GlobalFoundries has the passage of the CHIPS and Science Act to thank for the recent share price increase. The company reports results early Tuesday morning.
Analysts are mostly bullish on the stock, with 13 of 17 having a rating of Buy or Strong Buy and another two with Hold ratings. At a recent price of around $53.60 a share, the upside potential based on a median price target of $70.00 is 30.6%. At the high price target of $100, the upside potential is 86.6%.

For the company’s second quarter of fiscal 2022, analysts are forecasting revenue of $1.97 billion, which would be up 1.6% sequentially. Adjusted earnings per share (EPS) are forecast at $0.45, up 7.7% sequentially. For the full 2022 fiscal year, GlobalFoundries is expected to post adjusted EPS of $2.21, up from a loss of $0.05 in the prior year, on sales of $7.95 billion, up 20.7%.

The stock trades at 24.2 times expected 2022 EPS, 22.5 times estimated 2023 earnings of $2.38 and 16.8 times estimated 2024 earnings of $3.19 per share. The stock’s post-IPO range is $36.81 to $79.49. Globalfoundries does not pay a dividend.

Norwegian Cruise Lines

Over the past 12 months, shares of Norwegian Cruise Line Holdings Ltd. (NYSE: NCLH) dropped by about 42.6%. That is still better than either of its main rivals, Carnival and Royal Caribbean. Norwegian and Royal Caribbean have resumed a full schedule of sailings from south Florida, and Carnival is nearly there. Testing for COVID-19 has been dropped where local rules allow, and that does not include the United States. Since mid-June, Norwegian’s share price has risen by 25%, more than twice as much as either of its competitors. The company reports results before markets open on Tuesday.

Of 19 analysts covering the stock, nine have Buy or Strong Buy rating and the rest have Hold ratings. At a share price of around $13.00, the implied gain based on a median price target of $19.50 is 50%. At the high target of $35.00, the implied gain is about 169%.

Second-quarter revenue is forecast to come in at $1.25 billion, up 139% sequentially and from $4.37 million in the year-ago quarter. Analysts expect the company to post a per-share loss of $0.83, smaller than the prior quarter’s loss of $1.82 per share and lower than the year-ago quarterly loss of $1.93. For the full year, Norwegian is expected to post a loss per share of $2.27, compared to last year’s loss of $8.07 per share. Revenue is forecast to reach $5.4 billion, more than 700% from $647.99 million in 2021.

The stock trades at 7.6 times estimated 2023 earnings of $1.70 and 5.4 times estimated 2024 earnings of  $2.42 per share. Norwegian is not expected to post a profit this year. The stock’s 52-week range is $10.31 to $29.45, and the company does not pay a dividend. Total shareholder return for the past year was negative 42.6%.

Upstart

Consumer lending platform Upstart Holdings Inc. (NASDAQ: UPST) has seen its share price plunge by nearly 78% over the past 12 months. Shares fell below the break-even point in early March after peaking in mid-October. Since that October peak, the stock is down almost 93%. Upstart reports results after markets close Monday.

In July, the company warned that second-quarter revenue would come in lower than its previous forecast and the shares dived by 21% on the report. Rising interest rates and a mistimed conversion of loans to cash get the blame.
Of 13 analysts covering the stock, just two have a rating of Buy or Strong Buy and seven have Hold ratings. At a price of around $28.30 apiece, the shares trade just above the median price target of $28.00. At the high target of $69.00, the implied gain is about 144%.

Second-quarter revenue is forecast to come in at $235.3 million, down 24% sequentially and by 21.3% year over year. Analysts expect the company to post EPS of $0.08, down 87.5% sequentially and 87% lower year over year. For the full year, Upstart is expected to post EPS of $1.23, down 48.1%, on revenue of $1.08 billion, up 27.7%.

Upstart stock trades at 23.0 times expected 2022 EPS, 14.5 times estimated 2023 earnings of $1.95 and 7.6 times estimated 2024 earnings of  $3.75 per share. The stock’s 52-week range is $22.42 to $401.49, and the company does not pay a dividend. Total shareholder return for the past year was negative 77.9%.

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Velodyne Lidar

Velodyne Lidar Inc. (NASDAQ: VLDR) makes lidar (light detection and ranging, or laser-light) sensors for autonomous vehicles and drones. Over the past year, the stock has dropped about 83% of its value. The last good news the company received came in February when Amazon was given a warrant to purchase up to 40 million shares of Velodyne stock for $4.18 a share. The deal is good until February 4, 2030.

Since it came public through a SPAC merger in September of 2020, the Velodyne share price has dropped from a high of $25.15, or nearly 95%. The company reports quarterly results after markets close on Monday.

Of seven brokers covering the stock, four have a Hold rating and two more rate the shares at Buy or Strong Buy. At a trading price of about $1.30 a share, the implied gain to the consensus price target of $2.00 is 53.8%. At the high target of $12, the upside potential is more than 800%.

Analysts expect Velodyne to report second-quarter revenue of $11.43 million, up 85% sequentially but 16% lower year over year. The forecast loss per share is $0.21, compared to a loss of $0.22 per share in the prior quarter and $0.18 in the year-ago quarter. For the full year, Velodyne is expected to post a per-share loss of $0.80, compared with a loss per share of $0.67 last year, on sales of $44.76 million, down 27.7%.

Velodyne is not expected to post a profit in 2022, 2023 or 2024. The stock’s enterprise value to sales multiple is 0.6 for 2022, an estimated 0.4 for 2023 and an estimated 0.2 for 2024. The stock’s 52-week range is $0.82 to $8.50. The company does not pay a dividend and the total shareholder return last year was negative 83.2%.

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