This week’s biggest guides, from Netflix to Goldman Sachs | Wilnesh News
This week, some of the largest U.S. banks and leading streaming companies will report first-quarter corporate earnings. More than 35 S&P 500 companies will release their latest quarterly data, including Goldman Sachs, Bank of America and Morgan Stanley. Netflix is waiting in the wings. Friday’s reporting period got off to a rocky start. JPMorgan Chase reported better-than-expected results, but concerns about net interest income weighed on the stock. So far, about 30 S&P 500 companies have reported first-quarter data. FactSet data shows that 80% of them exceeded expectations. Check out CNBC Pro’s breakdown of expectations for some of the week’s biggest stories. All times are Eastern Time. Goldman Sachs will report earnings before the market opens on Monday, followed by a conference call at 9:30 a.m. This quarter: Analysts expect Goldman Sachs’ revenue to rise slightly from a year earlier, according to London Stock Exchange Group (LSEG). What CNBC is watching: The investment bank’s stock heads into its quarterly report following a straight week of losses. Can first-quarter numbers get Goldman Sachs back on track? JMP Securities analyst Devin Ryan said earlier this month that he favors Goldman Sachs over rival Morgan Stanley due to more attractive valuations. Ryan said: “This view is not a negative view of Morgan Stanley’s business model, but a comment that the valuation has reflected a more normalized return profile, while Goldman’s valuation has been affected by the inevitable normalization. And it’s temporarily mispriced. History shows: Goldman Sachs has beaten estimates on 85% of its earnings forecasts, but the company’s stock price fell on three of the last five earnings days. fell 6.4% on the day. Bank of America will report earnings before the market opens on Tuesday. A conference call with management is scheduled for 8:30 a.m. Last quarter: BAC shares fell after the bank reported a drop in fourth-quarter profit, according to LSEG. Data, the Charlotte-based banking giant expects profits to fall nearly 20% annually What CNBC is watching: Bank of America shares have been underperforming recently, falling 5.6% this month as investors repriced expectations for a rate cut. In early April, UBS downgraded Bank of America’s rating to “neutral” from “buy,” noting that while the bank could theoretically make more money through higher interest rates, “the impact on the economy and its (Hold-to-maturity bond) portfolio concerns may resurface and have a larger negative impact on market multiples. History shows: Bank of America has beaten profit expectations 79% of the time, according to Bespoke data. The stock is down an average of 0.7% on earnings days, but has risen following nine of the past 10 releases. UnitedHealth will report earnings before the bell, followed by a conference call at 8:45 a.m. Last quarter: UNH reported better-than-expected earnings and revenue, but shares fell more than 3%. This quarter: The health insurance giant expects profit and revenue growth to edge up slightly from a year ago, according to data from London Stock Exchange Group. What CNBC is watching: The health insurance company needs a win in its first-quarter report. Shares of the Dow Jones Industrial Average member have fallen 16% so far this year due to the impact of the cyberattack and lower-than-expected Medicare Advantage premium increases. Could the company’s report spark a comeback? History shows: UnitedHealth Group has missed profit expectations just twice since the start of 2018, Bespoke data shows. The stock also performed well on earnings day, rising an average of 0.8%. Morgan Stanley will report earnings before the market opens. An earnings call is also scheduled for 9:30 a.m. Last quarter: Microsoft beat revenue estimates, but its CEO warned of geopolitical and economic risks ahead. This quarter: Analysts polled by London Stock Exchange Group (LSEG) expect profits and revenue to be slightly down from the same period last year. What CNBC is watching: Morgan Stanley took a hit last week, with its shares falling more than 6% after The Wall Street Journal reported that multiple regulators were investigating how the company’s wealth management arm checks clients at risk of money laundering. Investors will be watching for the latest news on this front and how banks will respond to the changing interest rate environment. History shows: The Wall Street bank’s shares have gained an average of 0.8% on earnings days, according to Bespoke. The company also beat profit estimates 78% of the time. United Airlines will report earnings after the close. A conference call is scheduled for 10:30 a.m. the next day. Last quarter: UAL expects a first-quarter loss due to the grounding of Boeing 737 Max 9 planes. This quarter: The airline’s revenue is expected to rise nearly 9% annually, according to LSEG. What CNBC airline reporter Leslie Josephs is watching: Investors will be watching to see how much growth United can achieve in the coming months and years. United Airlines is one of the airlines suffering from delays in deliveries from Boeing, which it attributes to its decision to suspend pilot hiring this spring and provide pilots with unpaid leave. The FAA has also provided additional oversight over recent mechanical issues at United, including a tire that came off a 777 during takeoff from San Francisco last month. United said in early April it would postpone two routes based on an FAA safety review. United Airlines canceled its investor day event as it focused on the FAA’s review of safety protocols. History shows: Customized data shows that United has exceeded profit expectations for six consecutive quarters. The stock also posted strong gains on four of the trades. Netflix is scheduled to report earnings after the market close on Thursday. Conference call with management scheduled for 4:45 PM Last Quarter: NFLX gained 10% on strong subscriber growth and better-than-expected revenue. This quarter: The dominant U.S. streaming platform is expected to report profit growth of more than 50% from the same period last year, according to LSEG. CNBC is watching: Netflix’s stock price has soared this year, soaring more than 27%. Oppenheimer analyst Jason Helfstein noted that momentum could continue into first-quarter earnings. He expects ad-supported subscriptions to be strong, saying, “The tail of paid sharing will be longer than initially thought, with only 20% of 100 million opportunities being captured to date.” History Shows: According to Bespoke According to the data, Netflix’s profit forecasts exceeded expectations 80% of the time. Shares rose an average of just 0.1% on earnings days, but have seen double-digit gains following the release of the last two reports. On Friday, Procter & Gamble will report earnings before the bell, followed by a conference call at 8:30 a.m. brought a boost. This quarter: The maker of Ivory soap and Crest toothpaste expects profit and revenue to rise slightly from the same period last year, according to London Stock Exchange Group (LSEG). What CNBC is watching: Morgan Stanley analyst Dara Mohsenian said P&G’s performance could be a mixed bag. In an April 7 report, he said organic sales growth was likely to be weak, but added that gross margins were likely to be strong. “We remain long-term (overweight) as PG market share continues to grow due to strong execution despite slowing (organic sales growth) due to recent weakness in the beauty category in China, slower category growth in developed markets and slower pricing , and will improve in the future. History shows: Bespoke data shows that Procter & Gamble’s profit expectations have exceeded expectations in the past four quarters, with daily profit growth of at least 2.6% in each quarter.
