In the first half-hour of trading on Wednesday, the Dow Jones industrials were down 0.41%, the S&P 500 down 0.35% and the Nasdaq down 0.13%. Retail sales in January came in much stronger than economists had predicted. Sales in every category posted a month-over-month increase, led by a boisterous 7.2% increase in food services and drinking establishments.

After U.S. markets closed Tuesday, Airbnb posted earnings per share (EPS) and revenue that beat consensus estimates and guided first-quarter revenue above consensus. Shares traded up 12.4% in the early going Wednesday.

Devon Energy reported mixed results, with EPS below the consensus estimate and revenue slightly higher. The stock traded down 10.6% Wednesday morning.

Livent also reported mixed results, surpassing the EPS consensus but missing on revenue. Shares traded up more than 3%.

Before markets opened on Wednesday, Barrick Gold beat the consensus EPS estimate by a penny and missed on revenue. The company also announced a new $1 billion buyback program. Shares traded down 3.3%

Kraft Heinz beat estimates on both the top and bottom lines but issued downside guidance for the 2023 fiscal year. The stock traded up about 0.8%.

Roblox reported a smaller-than-expected loss per share while beating the consensus revenue estimate. Revenue and bookings were reported to be strong in January. Shares traded up more than 24%.

Albemarle, Antero Resources, Cisco Systems and Energy Transfer will report earnings after Wednesday’s closing bell. First thing Thursday morning, look for reports from Cenovus Energy, Datadog and Paramount Global.

Here is a look at what analysts expect when these four companies report quarterly results late Thursday or early Friday.

Applied Materials

Shares of semiconductor equipment maker Applied Materials Inc. (NASDAQ: AMAT) have cut their decline from a 12-month drop of 30% at the end of the October quarter to just over 10% as of Tuesday’s close. The stock is up nearly 22% so far in 2023. The company reports fiscal first-quarter results on Thursday.

Forecasts for chip demand in the current year have sales declining by up to 6% year over year, the industry’s first decline in four years. Companies like Applied Materials that make the precision and hugely expensive equipment to manufacture chips are also expected to experience lower demand.
Of 31 analysts covering Applied Materials stock, 22 have Buy or Strong Buy ratings and eight more have Hold ratings. At a recent price of around $118.50 a share, the implied upside based on a median price target of $125.00 is about 5.5%. At the high target of $140.00, the upside potential is 18.1%.

For the company’s first quarter of fiscal 2023, analysts expect revenue of $6.66 billion, which would be down 1.4% sequentially but up 6.2% year over year. Adjusted EPS are forecast at $1.92, down 5.4% sequentially and up 1.6% year over year. For the full fiscal year ending in October, analysts anticipate EPS of $6.61, down 14.2%, on sales of $24.1 billion, down 6.7%.

Applied Materials’ stock trades at about 17.9 times expected 2023 EPS, 18.0 times estimated 2023 earnings of $6.59 and 14.3 times estimated 2024 earnings of $8.26 per share. The stock’s 52-week trading range is $71.12 to $143.79. Applied Materials pays an annual dividend of $1.04 (yield of 0.91%). Total shareholder return over the past year was negative 9.34%.

Deere

Heavy equipment maker Deere & Co. (NYSE: DE) has posted a share price gain of 5.7% over the past 12 months. Since posting a 52-week low in early July, the stock has added more than 42%, including a year-to-date dip of 4.5%. Deere reports quarterly results on Friday morning.

A month ago, Deere signed a memorandum of understanding with the American Farm Bureau Federation that allows farmers to repair their own equipment. Deere, like Apple until last year, required owners to get service and repair work done only at authorized shops. On Monday, the U.S. Department of Justice weighed in against Deere in a related case seeking damages for alleged Deere violations of the Sherman Antitrust Act.

Analysts continue to be bullish, with 16 of 26 having a rating of Buy or Strong Buy and nine more rating the stock at Hold. At a share price of around $409.00, the upside potential based on a median price target of $477.00 is 16.6%. At the high price target of $582.00, the upside potential is 42.3%.

For the company’s first quarter of fiscal 2023, analysts expect Deere to report revenue of $11.14 billion, down 22.4% sequentially but 30.6% higher year over year. Adjusted EPS are expected to come in at $5.47, down 29.5% sequentially and up 87.3% year over year. For the full 2023 fiscal year ending in October, EPS are forecast at $27.93, up 16.4%, on sales of $53.51 billion, up 11.7%.

Deere stock trades at 14.7 times expected 2023 EPS, 13.9 times estimated 2024 earnings of $29.44 and 13.1 times estimated 2025 earnings of $31.21 per share. The stock’s 52-week range is $283.81 to $448.40. The company pays an annual dividend of $4.80 (yield of 1.17%). Total shareholder return over the past year was 7%.

DraftKings

Punters placed 100 million mobile betting transactions on last Sunday’s Super Bowl, a year-over-year increase of 25%. DraftKings Inc. (NASDAQ: DKNG) paid out $2.68 million on a $1.68 million bet on the (winning) Kansas City Chiefs. None of the Super Bowl numbers will show up until the company reports current quarter earnings in a few more months. But World Cup betting will be in fourth-quarter results. That plus DraftKings’ expansion into several new states during the quarter should make the company a favorite to beat estimates when it reports results on Thursday.
Analysts remain somewhat bullish on DraftKings, with 16 of 32 having a Buy or Strong Buy rating and 13 having Hold ratings. At a share price of around $16.50, the upside potential based on a median price target of $19.50 is 18.2%. At the high target of $48.00, the upside potential is nearly 200%.

Fourth-quarter revenue is forecast at $797.71 million, up 59.0% sequentially and by 68.6% year over year. Analysts forecast a loss per share of $0.49 in the quarter, compared to a prior quarter loss of $0.97 and a year-ago loss of $0.79 per share. For the full 2022 fiscal year, DraftKings is expected to post a per-share loss of $2.51, better than the $3.69 loss per share in 2021. Sales are forecast to rise 68.1% year over year to $2.18 billion.

DraftKings is not expected to post a profit in 2022, 2023 or 2024. The stock trades at a multiple of 3.4 times estimated 2022 enterprise value to sales, 2.5 times the estimated 2023 estimated sales of $2.91 billion and 2.1 times estimated 2024 sales of $3.57 billion. The stock’s 52-week range is $9.77 to $425.01. The company does not pay a dividend. The total shareholder return for the past year was negative 25.23%.

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Vale

Over the past 12 months, shares of Brazilian iron ore miner Vale S.A. (NYSE: VALE) have declined by about 4%, despite a boost of more than 23% over the past six months. Vale reports quarterly earnings on Thursday.

When the company reported production for December, totals were down 10% sequentially and 1% year over year. Automaker GM has discussed taking a stake of up to 10% in Vale’s base metals mining unit, an investment valued at up to $2 billion, according to a report in The Wall Street Journal. GM and other electric vehicle makers would be most interested in guaranteeing supplies of nickel and other metals used in their EV batteries.

Of 13 analysts covering the stock, nine have a Buy or Strong Buy rating and the others have Hold ratings. At a share price of around $17.00, the implied gain based on a median price target of $19.50 is 14.7%. At the high price target of $24.00, the upside potential reaches 41.2%.

Fourth-quarter revenue is forecast at $11.39 billion, up 14.7% sequentially but 8.9% lower year over year. Adjusted EPS are forecast at $0.57, down 46.0% sequentially and by 48.6% year over year. For the full 2022 fiscal year, analysts expect EPS of $3.61, down 19.2%, on sales of $43.47 billion, down 20.2%.

Vale stock trades at 4.6 times expected 2022 EPS, 5.7 times estimated 2023 earnings of $2.90 and 8.8 times estimated 2024 earnings of $1.91. The stock’s 52-week range is $11.72 to $21.29. The company pays an annual dividend of $0.74 (yield of 4.48%). Total shareholder return for the past 12 months was 6.3%.

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