Stocks to watch: Delta, PepsiCo, BBBY. Let's see what is expected about them
The coming week will mark the ‘official’ start of the US earnings season when the big banks start releasing their quarterly results. Before then, the US will see a number of companies release their earnings this week.
This article will highlight some of these companies.
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Delta (DAL) is one of the largest airline company in the world with a market cap of more than $38 billion. It is much bigger than United Airlines and American Airlines, which have a market cap of more than $23 billion $14 billion respectively. The company will release its Q2 earnings on Thursday.
Investors expect the results to show that the company had an EPS of $2.3, which will be higher than the $1.77 for the same quarter last year. They expect the company’s revenue to be $12.46 billion. In the same quarter last year, the company had revenues of more than $11.78.
The results will shed light on the state of the US economy. They will also shed more light on the state of the US airlines industry as Boeing continues to go through challenges following the Ethiopian Airlines jet. The chart below shows the performance of the company’s stock this year.
The chart below shows the performance of the company’s stock this year.
Bed Bath & Beyond
Bed Bath & Beyond was one of the biggest home goods retail company. In recent years, the company has lost market share as the retail sector continues to weaken. The company has also been disrupted by the likes of Amazon, which offer an easier method of buying home goods.
Therefore, the company’s stock is currently trading at $11.47 after peaking at above $80 in 2013. The market capitalization stands at just $1.47 billion.
To deal with the retail-apocalypse, the company has been shutting down underperforming stores and investing in its digital solutions. Investors expect the company to deliver an EPS of 8 cents on revenues of more than $2.58 billion.
At this valuation, the company is trading at a forward PE ratio of 5, which is much lower than the 11 when the year started.
Pepsico is one of the biggest consumer goods company in the world. The company has a market value of more than $186 billion and is currently trading at an all-time high. This valuation is about $40 billion lower than that of its global competitor, Coca-Cola, which has a market value of more than $222 billion.
The company released its report on Tuesday before the market opens. Investors expected it to report an EPS of $1.60 on revenue of $16.4 billion.
A year ago, the company had an EPS of $1.61 on revenue of $16.09 billion. The company – together with Coca-Cola – are trying to adjust their businesses to match the needs of the modern consumer who prefers beverages with low salt, sugar, and more natural ingredients.
At this valuation, investors are paying 22x forward earnings on a growth of just 4%.
Fastenal is a giant supplier of OEM, MRO, and construction products. The company has more than 2,700 stores worldwide and has a market cap of more than $18 billion. The company will release its earnings on Thursday and investors expect it to have an EPS of 37 cents on revenue of $1.38 billion.
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More useful resources for Earnings Season
Earnings Calendar from investing
An interesting arcticle by CNBC