About 90 minutes after Friday’s opening bell, the Dow Jones industrials traded 0.09% higher, while the S&P 500 was down 0.1% and the Nasdaq down 0.66%. China’s top-tier e-commerce companies were dragging the Nasdaq lower.
After markets closed Thursday, Cloudflare beat earnings per share (EPS) and revenue estimates. The cybersecurity company also issued first-quarter and full-year guidance in line with expectations. Shares traded up about 3% Friday morning.
Lyft posted a net loss of $0.76 per share, while analysts had projected EPS of $0.13. Even worse, the company said it expects EBITDA of between $5 million and $15 million in the current quarter. Analysts had forecast $83.6 million. The stock was down about 35.6%.
PayPal beat the consensus EPS estimate but missed on revenue by about $10 million, or about 0.013%. The payment provider also raised fiscal year EPS guidance and expects current-quarter revenue to close above the average analyst estimate. Shares traded up 2.8%.
Before markets opened on Friday, Enbridge missed the consensus EPS estimate. The Canada-based firm also raised its annual dividend to CAD$3.55 and reaffirmed previous 2023 guidance. Shares traded up 1.5%.
After U.S. markets close on Monday, Palantir Technologies and Vornado Realty Trust will report their quarterly results.
Here is a look at what to expect from three firms reporting earnings first thing Tuesday morning.
24/7 Wall St.Cleveland-Cliffs
Shares of iron ore miner and steelmaker Cleveland-Cliffs Inc. (NYSE: CLF) have dropped by about 7% since posting a 52-week high last April. That is a 40% jump since putting up a 52-week low in early November. Iron ore prices have risen by around 56%, and steel prices are up almost 16% since posting annual lows at the same time.
Earlier this week, the company raised prices for certain steel products by a minimum of $50 a ton after raising prices on hot-rolled steel a few weeks ago by $850 a ton. Cliffs has set a 2023 price of $1,400 a ton for a mix of hot-rolled, cold-rolled and coated steel products for automakers, a price jump of $1,300 per ton compared to the 2022 price.
Of 12 brokerages covering the stock, five have a Buy or Strong Buy rating and six rate the shares at Hold. At a recent price of around $19.50 a share, the implied gain based on a median price target of $21.75 is 11.5%. At the high price target of $27.00, the upside potential is 38.5%.
Analysts forecast second-quarter revenue of $5.22 billion, which would be down 7.7% sequentially and by 2.4% year over year. Analysts are forecasting an adjusted loss per share of $0.28, down from EPS of $0.29 sequentially and from $1.76 in the year-ago quarter. For the full 2022 fiscal year, analysts expect Cliffs to report EPS of $2.90, down nearly 50%, on sales of $23.1 billion, up nearly 13%.
The stock trades at about 6.7 times expected 2022 EPS, 10.2 times estimated 2023 earnings of $1.90 and 8.2 times estimated 2024 earnings of $2.36 per share. The stock’s 52-week trading range is $11.82 to $34.04, and the company does not pay an annual dividend. Total shareholder return over the past year was negative 7.2%.
Coca-Cola
Dow component and Warren Buffett favorite Coca-Cola Co. (NYSE: KO) has posted a share price decline of about 3% over the past 12 months. For the year to date, the stock is down about 7%, worse than the consumer staples sector’s decline of around 3% for the same period.
PepsiCo’s outstanding report earlier this week has not had a positive effect on Coca-Cola’s stock, and that is something of a mystery. Demand appears to be strong, and both firms have been able to raise prices to cover higher costs. The big differences between the two are PepsiCo’s snack food business, and Coke’s reliance on the global soft drinks market is about twice that of Pepsi’s.
Analysts are bullish on the stock, with 19 of 26 of them having a Buy or Strong Buy rating. The other seven have Hold ratings. At a share price of around $60.00, the upside potential based on a median price target of $68.00 is 13.3%. At the high price target of $77.00, the upside potential is 28.3%.
Fourth-quarter revenue is forecast at $9.92 billion, down 10.6% sequentially but up 4.8% year over year. Adjusted EPS are pegged at $0.45, down 35% sequentially and flat year over year. For the full 2022 fiscal year, consensus estimates call for EPS of $2.49, up 7.4%, on revenue of $42.8 billion, up 10.7%.
Coca-Cola stock trades at 23.9 times expected 2022 EPS, 23.3 times estimated 2023 earnings of $2.56 and 21.5 times estimated 2024 earnings of $2.78 per share. The stock’s 52-week range is $52.28 to $67.20. Coca-Cola pays an annual dividend of $1.76 (yield of 2.95%). Total shareholder return for the past year was negative 0.09%.
Peabody Energy
Since posting a 52-week low some 50 weeks ago, the stock price of Peabody Energy Corp. (NYSE: BTU) rose to a 52-week high 130% higher by mid-April. Since then, the shares have dropped by nearly 23% but still show a 12-month gain of about 71%. Coal prices are down by about a fifth since last April and by more than 50% since the November peak. According to the International Energy Agency (IEA), coal demand rose to more than 8 billion metric tons in 2022, and the agency believes demand will remain flat through 2025.
Only four brokerages cover the stock, and three of them have Buy ratings. The fourth has a Hold rating. At a share price of around $26.00, the upside potential based on a median price target of $33.50 is 28.8%. At the high price target of $39.00, the upside potential is 50%.
Fourth-quarter revenue is forecast at $1.37 billion, up about 2% sequentially and 8.7% higher year over year. Adjusted EPS are pegged at $1.93, about flat sequentially and down 44.2% year over year. For the full 2022 fiscal year, consensus estimates call for EPS of $6.10, down 7.5%, on revenue of $4.72 billion, up 42.4%.
Peabody stock trades at 4.2 times expected 2022 earnings, 3.7 times estimated 2023 earnings of $6.94 and 15.2 times estimated 2024 earnings of $1.70 per share. The stock’s 52-week range is $14.34 to $33.29. The company does not pay a dividend. Total shareholder return for the past year was 73.3%.
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