In early trading on Monday, the Dow Jones industrials were down 0.08%, the S&P 500 down 0.33% and the Nasdaq 0.43% lower.

After U.S. markets closed on Monday, Devon Energy beat consensus estimates on both the top and bottom lines. Devon also boosted its share buyback program by 50% to $3 billion and declared a fixed-plus-variable dividend of $0.72, down from $0.89 in the prior quarter. Shares traded down 1.9%.

Lucid posted a wider-than-expected loss and fell short of the consensus revenue estimate by about 30%. At a cash burn rate of around $1 billion per quarter, the company has enough liquidity to last through the second quarter of 2024. Shares traded down 8.8%.

Palantir reported better-than-expected earnings per share (EPS) and revenue. The company added 52 new U.S. customers in the past year, up 50%. Palantir issued downside guidance for second-quarter revenue and in-line guidance for the 2023 fiscal year. Shares traded up 21.1%.

Before U.S. markets opened on Tuesday, Duke Energy missed the consensus EPS estimate but surpassed analysts’ expectations for revenue. The company said it expects a 25% sequential increase in revenue in the second quarter thanks to its acquisition of FlexSteel. Shares traded down 1.3%. Duke’s 4.05% dividend yield makes a difference here.

Fox beat top-line and bottom-line estimates despite a massive settlement in the Dominion lawsuit and the firing of top-rated program host Tucker Carlson. Fox also authorized a $7 billion share buyback program. Shares traded up 0.5%.

Fisker, another EV maker, reported a bigger loss than analysts expected and just $200,000 in revenue, compared to an estimate of $2.52 million. Shares traded down 6.8%.

Nikola reported a net loss of $0.26 per share, exactly on target, on sales that fell short of expectations. The company also announced more focus on fuel-cell trucks, hydrogen refueling stations and autonomous-driving technologies in the North American market. With just $154 million in cash and equivalents, the company’s burn rate of $232 million in the first quarter is an ominous sign. Shares traded down 9.9%.

After U.S. markets close on Tuesday, Affirm, Airbnb, Luminar, Occidental Petroleum and Rivian are set to report earnings. Hecla Mining, Li Auto and Roblox will report results first thing Wednesday morning.

The following two companies are scheduled to report quarterly earnings after U.S. markets close on Wednesday. Note that Disney also reports results late Wednesday.

Robinhood

In late July, Robinhood Markets Inc. (NASDAQ: HOOD) will celebrate the second anniversary of its initial public offering. It is unlikely to be much of a party, though. The stock is down about 75% since then.
Robinhood’s moment in the sun has been shortened by increasing competition from much bigger players and by its attachment to crypto trading, where the sun also hides behind a cloud these days. Except for its first quarter as a publicly traded company, Robinhood has not met the consensus sales estimate and has never posted a profit. In March, the company launched an individual retirement account that matches customer contributions with a 1% contribution from Robinhood.

Just 14 brokerages cover the stock. Of those, only three have a Buy or Strong Buy rating, and seven more rate it at Hold. At Monday’s closing price of around $9.00, the upside potential based on a median price target of $10.00 is 11.1%. At the high price target of $25.00, the upside potential is more than 175%.

For Robinhood’s first quarter of fiscal 2023, revenue is forecast at $426.77 million, which would be up 12.3% sequentially and by 47.2% year over year. Analysts are looking for an adjusted loss per share of $0.49, compared to a loss of $0.13 per share in the previous quarter and the year-ago loss of $0.45 per share. For the full fiscal year, consensus estimates call for an adjusted loss per share of $0.28, well below the 2022 fiscal year loss of $0.99 per share. Revenue is forecast at $1.84 billion, up 35.7%.

Robinhood is expected to post a profit of $0.48 per share in 2024, yielding a price multiple of 18.7. The stock’s 52-week trading range is $6.81 to $12.76. The company does not pay a dividend, and total shareholder return for the past year was negative 5.58%.

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Unity Software

Real-time 3D video development platform maker Unity Software Inc. (NYSE: U) has seen its share price decline by more than 50% over the past 12 months, despite a gain of 19.5% over the past six months. Last week the company announced a cut of 8% (about 600) in staffing, a move described as positioning the company for “long-term and profitable growth.” The stock has added 13% since the announcement, but that only makes up about half the decline over the past month. Unity is going to have to do more and better.

Of 22 analysts covering the stock, 10 have a Buy or Strong Buy rating and nine rate it at Hold. At a share price of around $28.40, the upside potential to the median price target of $40.00 is 40.8%. At the high target of $67.00, the upside potential is more than 135%.

First-quarter revenue is expected to rise sequentially by 6.4% to $479.83 million and to rise about 50% year over year. The consensus estimate calls for a loss per share of $0.03, compared to a $0.05 loss per share in the prior quarter and a loss of $0.08 per share in the year-ago quarter. For the full year, analysts now expect Unity to post EPS of $0.28, better than the year-ago loss of $0.31. Revenue is expected to rise by 52.7% to $2.12 billion.

Unity shares trade at 101.9 times estimated 2023 earnings, 33.8 times estimated 2024 earnings of $0.84 and 24.0 times estimated 2025 earnings of $1.18 per share. The stock’s 52-week range is $21.22 to $58.63. Unity does not pay an annual dividend, and total shareholder return for the past year was negative 43.87%.

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