After U.S. markets closed on Monday, Canoo reported no revenue, as expected, and a narrower-than-expected adjusted loss per share of $0.14. The company also launched its Lifestyle Delivery Van (LDV) 190, expanding its electric cargo van offerings into a heavier class. Canoo said it is “making progress on achieving a production readiness level of 20,000 vehicles per year by the end of 2023.” Shares were down about 1% shortly after Tuesday’s opening bell.

Before markets opened on Tuesday, Home Depot reported better-than-expected earnings per share (EPS) and revenue. While revenue beat the consensus estimate by 1.7%, it fell 2% short of revenue in the year-ago fiscal quarter. The Dow Jones industrial average component reaffirmed fiscal year 2024 guidance and authorized a new $15 billion share buyback program. The stock traded up about 2%.

Sea Limited missed both top-line and bottom-line estimates. The Singapore-based company cited lukewarm consumer spending and a weak macroeconomic environment as responsible for a sharp drop in its mobile gaming business. Shares plummeted more than 25% early Tuesday.

Tencent Music also missed consensus estimates on the top and bottom lines. EPS missed by a penny, and revenue missed by $2 million (less than 0.1%) but beat the year-ago total by 5.5%. Shares traded up 0.4%.

After U.S. markets close on Tuesday and before they open on Wednesday, JD.com, Nu Holdings, Target, TJX and Zim Shipping are scheduled to report quarterly results.

Here is a look at what to expect when these three firms report earnings later on Wednesday.

Cisco Systems

Networking giant and Dow component Cisco Systems Inc. (NASDAQ: CSCO) has posted a share price boost of 13.1% over the past 12 months, including an increase of 13% for the year to date. Since registering a 52-week low in mid-October, the stock is up almost 40%, including a new 52-week high in mid-April. The sharp increase in the share price is likely due to the knock-on effects of the enthusiasm for AI. If anything, analysts expect no downside to Cisco’s business stemming from AI.

Analysts remain mildly bullish on the stock, with 12 of 29 having a rating of Buy or Strong Buy and 16 more rating it at Hold. At a recent price of around $54.00 a share, the upside potential based on a median price target of $56.00 is 3.7%. At the high price target of $73.00, the upside potential is 35.2%.

For Cisco’s fourth quarter of fiscal 2023, analysts are expecting revenue of $15.05 billion, which would be an increase of 3.3% sequentially and 14.9% higher year over year. Adjusted EPS are forecast at $1.06, up about 5.9% sequentially and by 27.7% year over year. For the full fiscal year that ended in July, analysts estimate EPS of $3.81, up 13.3%, on revenue of $56.8 billion, up 10.2%.

Cisco’s stock trades at 14.2 times expected 2023 EPS, 13.3 times estimated 2024 earnings of $4.04 and 12.8 times estimated 2025 earnings of $4.40 per share. Its 52-week trading range is $38.60 to $54.14. Cisco pays an annual dividend of $1.56 (yield of 2.94%). Total shareholder return over the past year was 19.39%.

Sociedad Química y Minera de Chile S.A. (NYSE: SQM) is a specialty chemicals company that produces a variety of raw materials, including lithium. SQM, as it is commonly known, has seen its stock price fall by more than 39% over the past 12 months. The price of lithium has dropped by more than 57% over the same period, and a government plan to create a state-owned lithium company sent shares tumbling by 18% on the day it was announced. In the past month, the stock has dropped 17.5%. Safe to say that state control of Chile’s lithium industry is not widely viewed as a plus for that industry.

Of 16 brokerages covering the stock, 10 have a Buy or Strong Buy rating and five have Hold ratings. At a share price of around $66.00, the implied upside to a median price target of $89.00 is 34.8%. Based on the high price target of $136.00, the upside potential is 106%.

Second-quarter revenue is forecast at $2.13 billion, down 6.1% sequentially and by 18.1% year over year. Adjusted EPS are forecast at $2.64, up 0.4% sequentially but 12.3% lower year over year. For the full 2023 fiscal year, analysts expect SQM to report EPS of $11.25, down 17.7%, on sales of $9.85 billion, down 8.1%.

SQM stock trades at 5.9 times expected 2023 EPS, 6.5 times estimated 2024 earnings of $10.12 and 7.4 times estimated 2025 earnings of $8.89 per share. The 52-week trading range is $60.21 to $115.72. The company pays an annual (variable) dividend of $8.74 (yield of 12.98%). Total shareholder return over the past year was negative 34.75%.

StoneCo

StoneCo Ltd. (NASDAQ: STNE) provides fintech services to merchants and their partners in Brazil. The company is headquartered in the Cayman Islands and is a subsidiary of HR Holdings. Over the past 12 months, its shares have added about 11.4%, including a year-to-date jump of 42.3%. Warren Buffett’s Berkshire Hathaway owns about 10.7 million shares (3.4%) of StoneCo stock and 107.1 million shares (2.3%) of another Brazilian fintech firm, Nu Holdings, which is expected to post its results Tuesday’s closing bell.

Analysts have adopted a show-me approach to StoneCo, with 11 of 19 having a Hold rating and 7 more rating the stock a Buy. At a share price of around $13.50, the upside potential based on a median price target of $15.08 is 11.7%. At the high price target of $19.55, the upside potential is about 44.8%.

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StoneCo is expected to report second-quarter revenue of $583.15 million, up 9.0% sequentially and 32.4% higher year over year. Adjusted EPS are forecast at $0.17, up 21.4% sequentially and up from $0.05 in the year-ago quarter. For the full 2023 fiscal year, analysts expect EPS of $0.73, up 127.1%, on revenue of $2.35 billion, up 29.8%.

StoneCo’s share price to earnings multiple for the 2023 fiscal year is 18.3. For the 2024 fiscal year, the multiple to estimated EPS of $0.94 is 14.3, and for 2025, the multiple is 11.7 times estimated EPS of $1.15. The stock’s 52-week trading range is $8.07 to $14.83. StoneCo does not pay a dividend, and total shareholder return for the past year was 11.36%.

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