Earnings Heat Up And Gold On Display
Welcome to Seeking Alpha’s Stocks to Watch – a preview of key events scheduled for the next week. Follow this account and turn the e-mail alert on to receive this article in your inbox every Saturday morning. A podcast of Stocks to Watch is also available on Sundays on Seeking Alpha, Apple Podcasts, Stitcher and Spotify (click the highlighted links).
Earnings season ramps up next week with major companies like Delta Air Lines (NYSE:DAL), AT&T (NYSE:T), Coca-Cola (NYSE:KO), IBM (NYSE:IBM) and Lockheed Martin (NYSE:LMT) set to give their varying outlooks on the pandemic and the road ahead. All told, about a fifth of S&P 500 companies will report results before the closing bell on Friday. Investors already know that profit will be down in Q1 and Q2. The bigger questions are if share prices properly reflect the downturn and how well balance sheets will hold up. On the economic front, updates on existing home sales, new home sales and durable goods orders are due to drop, as well as another jobless claims report (~4M anticipated). Sports fans will get a small dose of action when Disney’s (NYSE:DIS) ABC and ESPN air the NFL Draft on April 23-25. On a lighter note, 4/20 Day is around the corner and Earth Day follows on April 22. If there is a pair trade there, it’s beyond us.
Earnings spotlight: Carnival (NYSE:CCL), Ally Financial (NYSE:ALLY), Halliburton (NYSE:HAL), IBM (IBM) and Equifax (NYSE:EFX) on April 20; Coca-Cola, JetBlue (NASDAQ:JBLU), Philip Morris (NYSE:PM), Travelers (NYSE:TRV), Chipotle (NYSE:CMG), Canadian Pacific (NYSE:CP), Snap (NYSE:SNAP), Texas Instruments (NASDAQ:TXN), Danone (OTCQX:DANOY) and Netflix (NASDAQ:NFLX) on April 21; AT&T, Delta Air Lines, NASDAQ (NASDAQ:NDAQ), Alcoa (NYSE:AA), Discover Financial Services (NYSE:DFS), Kinder Morgan (NYSE:KMI), Visa (NYSE:V), Lam Research (NASDAQ:LRCX) and Las Vegas Sands (NYSE:LVS) on April 22; Domino’s Pizza (NYSE:DPZ), Eli Lilly (NYSE:LLY), Freeport-McMoran (NYSE:FCX) and Hershey Foods (NYSE:HSY), Capital One (NYSE:COF), Intel (NASDAQ:INTC) and United Airlines (NASDAQ:UAL) on April 23; American Airlines (NASDAQ:AAL), American Express (NYSE:AXP), AutoNation (NYSE:AN), Sanofi (NASDAQ:SNY) and Verizon (NYSE:VZ) on April 24.
IPO watch: Holy smokes there is a new IPO to report. China Liberal Education (CLEU) is due to price on April 23. As of publication time, it doesn’t appear that the IPO has been pulled. Also in the week ahead, the lockup period expires on BRP Group (NASDAQ:BRP) on April 21, as well as on Phathom Pharmaceuticals (NASDAQ:PHAT), Progyny (NASDAQ:PGNY), Youdao (NYSE:DAO), Cabaletta Bio (NASDAQ:CABA), Aesthetic Medical International Holdings Group (NASDAQ:AIH), TFF Pharmaceuticals (NASDAQ:TFFP) and Happiness Biotech Group (NASDAQ:HAPP) on April 22. The stay-at-home order has disrupted the plans of several companies involved with sports and fitness. Topgolf International (Callaway Golf (NYSE:ELY) holds a stake), F45 Training and Xponential Fitness are all on the IPO sidelines.
Go deeper: Catch up on all the latest IPO news.
M&A tidbits: The Stars Group (NASDAQ:TSG)-Flutter Entertainment (OTC:PDYPF) merger will go to a vote next week. The Northwest Bancshares (NASDAQ:NWBI) and MutualFirst Financial (NASDAQ:MFSF) merger is set to close next week.
All that glitters: The World Gold Forum will run from April 20-23 in a virtual format. Keynote speakers include U.S. Global Investors’ (NYSEARCA:GOAU) Frank Holmes and World Gold Council CFO Terry Heymann. Other talks titled “A Rational Case for $7,000” and “Gold in Times of Market Dislocation” look like just the thing for gold bugs. Wall Street has been increasingly bullish on gold even with prices near a seven-year high. Participating companies include Endeavor Silver (NYSE:EXK), First Mining Gold (OTCQX:FFMGF), Alamos Gold (NYSE:AGI), Americas Gold and Silver Corporation (NYSEMKT:USAS), Avino Silver & Gold Mines (NYSEMKT:ASM), Equinox Gold (NYSEMKT:EQX), Alexco Resources (NYSEMKT:AXU), Barrick Gold (NYSE:GOLD), Erdene Resource Development (OTCPK:ERDCF), Great Panther Mining (NYSEMKT:GPL), Harmony Gold Mining (NYSE:HMY), Hecla Mining (NYSE:HL), Eldorado Gold (NYSE:EGO), IAMGOLD (NYSE:IAG), Kinross Gold (NYSE:KGC), Kirkland Lake Gold (NYSE:KL), MAG Silver (NYSEMKT:MAG), Minerals Technology (NYSE:MTX), NovaGold Resources (NYSEMKT:NG), Pan American Silver (NASDAQ:PAAS), Royal Gold (NASDAQ:RGLD), Newmont (NYSE:NEM), Sierra Metals (NYSEMKT:SMTS), Sandstorm Gold (NYSEMKT:SAND), Silvercorp Metals (NYSEMKT:SVM), SSR Mining (NASDAQ:SSRM), Vista Gold (NYSEMKT:VGZ), Wesdome Gold Mines (OTCPK:WDOFF), Golden Star Resources (NYSEMKT:GSS) and Agnico Eagle Mines (NYSE:AEM).
Projected dividend changes (quarterly): The list of the companies that have suspended or lowered dividend payouts is long due to the disruption around the pandemic, but there some outliers. Companies that recently raised their dividend payouts include Colgate-Palmolive (NYSE:CL), Costco (NASDAQ:COST), Equity Residential (NYSE:EQR), First Republic Bank (NYSE:FRC), Johnson & Johnson (NYSE:JNJ), Mid-America Apartment Communities (NYSE:MAA), Procter & Gamble (NYSE:PG) and UDR (NYSE:UDR). Next week’s forecasted dividend adjustments include Federal Signal (NYSE:FSS) to $0.09 from $0.08, Great Western Bancorp (NYSE:GWB) to $0.33 from $0.30, Ameriprise Financial (NYSE:AMP) to $1.04 from $0.97, W.W. Grainger (NYSE:GWW) to $1.56 from $1.44, Evercore (NYSE:EVR) to $0.61 from $0.58, Travelers to $0.85 from $0.82, Southern Co. (NYSE:SO) to $0.64 from $0.62, Agree Realty (NYSE:ADC) to $0.60 from $0.585, People’s United (NASDAQ:PBCT) to $0.18 from $0.1775, Healthcare Services (NASDAQ:HCSG) to $0.2025 to $0.20125, Core Laboratories (NYSE:CLB) to $0.01 from $0.25, Equitrans Midstream (NYSE:ETRN) to $0.15 from $0.45 and CenterPoint Energy (NYSE:CNP), to $0.15 from $0.29.
Spotlight on Netflix: Netflix is on tap to report earnings, with analysts expecting the company to report revenue of $5.7B and EPS of $1.64. “NFLX is a clear beneficiary of stay-at-home, but more importantly we believe it is also accelerating the secular shift toward on-demand streaming, resulting in a bigger business over time,” previews JPMorgan on the streamer. JP thinks the cancellation of live sports and strong content (including the unexpected virality of Tiger King) set up well for NFLX to have added 8.8M net adds in Q1 vs. 7M anticipated and guide for 5.6M new subs in Q2. Right in front of earnings week for Netflix, BTIG Research lifted its price target to a Street-high $500, while Benchmark went the other way with an initiation of the streamer at Sell and a lowly $327 PT.
Building planes: Boeing (NYSE:BA) will begin a phased return to work next week at its Puget Sound facilities in Washington. The company says ~27K workers will return throughout the week to resume production on the 747, 767, 777, and 787. Analysts think fiscal stimulus may moderate the impact of COVID-19 somewhat and may accelerate recovery, but think it could take until 2023 for production to return to 2019 levels. Shares of Boeing were up 12.3% on Friday.
Energy outlook: BP (NYSE:BP) is due to release its 2020 Energy Outlook on April 21 after pushing back the release from February. The company says the report will explore the forces shaping the global energy transition out to 2040 and the key uncertainties surrounding that transition. Of course, those uncertainties in the near term include the price of crude oil. At last check, WTI crude oil futures are trading at $18.27/bbl and Brent crude is swapping hands at $28.08/bbl. The U.S. Oil Fund ETF (NYSEARCA:USO) is down 66% YTD.
Business updates: Charles Schwab (NYSE:SCHW) has a call scheduled for April 21. BHP (NYSE:BHP) has a nine-month operational review set for April 21. U.S. Gold Corp. (NASDAQ:USAU) is scheduled to hold an electronic investor update webinar. CEO Edward Karr will update USAU shareholders on the outlook for the company and will be available for questions after the initial presentation.
FDA watch: The PDUFA date on Sanofi’s (SNY) MenQuadfi arrives on April 26. Data from Principia Biopharma’s (NASDAQ:PRNB) PRN2246 multiple sclerosis treatment will be presented on April 23. Zogenix (NASDAQ:ZGNX) has an investor call on April 26 to discuss two studies evaluating FINTEPLA in Dravet syndrome and Sunflower syndrome.
Casinos: Nevada Governor Steve Sisolak says he intends to offer details next week on some of the criteria he’ll use to determine when it will be safe to start reopening businesses in the state. Looking ahead, Union Gaming thinks protocols such as reduced gaming capacity, greater spacing between active slot machines, fewer seats at live gaming tables and masks for dealers could be part of a phase one opening for casinos, while amenities such as bars and nightclubs won’t be opened until phase two or three. Over the next few weeks, the scenario will be playing out in other states as well. The uncertainty over casino traffic is a big wildcard for investors considering Caesars Entertainment (NASDAQ:CZR), MGM Resorts (NYSE:MGM), Boyd Gaming (NYSE:BYD), Wynn Resorts (NASDAQ:WYNN), Las Vegas Sands (LVS), Full House Resorts (NASDAQ:FLL), Red Rock Resorts (NASDAQ:RRR), VICI Properties (NYSE:VICI), MGM Growth Properties (NYSE:MGP), Golden Entertainment (NASDAQ:GDEN), Scientific Games (NASDAQ:SGMS), Twin River Worldwide (NYSE:TRWH), Eldorado Resorts (NASDAQ:ERI), William Hill (OTCPK:WIMHY), Monarch Casinos & Resort (NASDAQ:MCRI), Penn National Gaming (NASDAQ:PENN), Century Casinos (NASDAQ:CNTY) and Churchill Downs (NASDAQ:CHDN).
Notable annual meetings: Virtual annual meetings next week of note include Canadian Pacific, Domino’s Pizza and Whirlpool (NYSE:WHR) on April 21, Coca-Cola and AutoNation (AN) on April 22, Texas Instruments and Greenhill & Co. (NYSE:GHL) on April 23, as well as Kellogg (NYSE:K) on April 24.
Lighting candles: SpaceX (SPACE) is targeting next week for the launch of a Falcon 9 rocket loaded with broadband satellites. The mission will mark SpaceX’s seventh for its Starlink constellation, which is aimed at transmitting internet connectivity to remote and underserved users around the world.
Barron’s mentions: The publication recommends buying banks stocks while they are down. JPMorgan Chase (NYSE:JPM), Wells Fargo (NYSE:WFC), Citigroup (NYSE:C), Bank of America (NYSE:BAC), Goldman Sachs Group (NYSE:GS) and Morgan Stanley (NYSE:MS) are all seen recovering as increases in trading and debt capital markets this year and next help to offset near-zero interest rates. In pharma, companies with pipelines of essential drugs are seen as obvious favorites. Mylan (NASDAQ:MYL), Perrigo (NYSE:PRGO), Merck (NYSE:MRK), AstraZeneca (NYSE:AZN), AbbVie (NYSE:ABBV), Eli Lilly (LLY) and Bristol-Myers Squibb (NYSE:BMY) all make the list. While Zoom Video Communications (NASDAQ:ZM) is called wildly expensive, there are still content-delivery networks that look interesting. Akamai (NASDAQ:AKAM), Cloudflare (NYSE:NET), Box (NYSE:BOX), Dropbox (NASDAQ:DBX), RingCentral (NASDAQ:RING), Vonage Holdings (NASDAQ:VG) and 8×8 (NYSE:EGHT) are all seen as benefiting from the stay-at-home world right now. Small cap Compass Diversified Holdings (NYSE:CODI) is identified as being in a position to emerge from the coronavirus recession stronger than it entered it. Finally, Raytheon Technologies (NYSE:RTX), Otis Worldwide (NYSE:OTIS) and Carrier Global (NYSE:CARR) are labeled as appealing after making their recent debut at about the worst possible time.