The third week of July 2024 brings a flurry of earnings reports from financial giants and industry leaders. Here's what investors should keep an eye on:
Monday, July 15th
BlackRock (BLK) - ★★★★
Ranked #15 in Q3 2024 Large Cap Equity Rankings
Earnings per share (EPS) estimate: $9.97
Key Indicators to Watch: Assets under management (AUM), Net inflows, particularly in ETFs and active strategies and Impact of market volatility on fee income.
Goldman Sachs (GS) - ★★★★★
Ranked #8 in Q3 2024 Large Cap Equity Rankings
Earnings per share (EPS) estimate: $8.35
Key Indicators to Watch: Investment banking revenue, especially M&A activity, trading revenue, particularly in fixed income, progress on consumer banking initiatives
Tuesday, July 16th
Bank of America (BAC) - ★★★★
Ranked #60 in Q3 2024 Large Cap Equity Rankings
Earnings per share (EPS) estimate: $0.80
Key Indicators to Watch: Net interest income and margins, Loan growth and credit quality, Cost control measures
Morgan Stanley (MS) - ★★★★
Ranked #19 in Q3 2024 Large Cap Equity Rankings
Earnings per share (EPS) estimate: $1.65
Key Indicators to Watch: Wealth management revenue and client assets, Investment banking fees, Trading revenue, especially in equities
PNC Financial Services (PNC) - ★★★★
Ranked #34 in Q3 2024 Large Cap Equity Rankings
Earnings per share (EPS) estimate: $2.99
Key Indicators to Watch: Commercial loan growth, Net interest margin, Progress on digital banking initiatives
Progressive (PGR) - ★★★★★
Ranked #6 in Q3 2024 Large Cap Equity Rankings
Earnings per share (EPS) estimate: $2.04
Key Indicators to Watch: Combined ratio (a measure of profitability for insurers), Premium growth, particularly in auto insurance, Impact of severe weather events on claims
UnitedHealth Group (UNH) - ★★★★
Ranked #37 in Q3 2024 Large Cap Equity Rankings
Earnings per share (EPS) estimate: $6.67
Key Indicators to Watch: Medical loss ratio, Medicare Advantage enrollment growth, Optum Health revenue and operating margins
Wednesday, July 17th
U.S. Bancorp (USB) - ★★★
Ranked #67 in Q3 2024 Large Cap Equity Rankings
Earnings per share (EPS) estimate: $0.95
Key Indicators to Watch: Net interest income trends, Non-interest income, particularly from payment services, Efficiency ratio and cost management
Thursday, July 18th
Netflix (NFLX) - ★★★★
Ranked #22 in Q3 2024 Large Cap Equity Rankings
Earnings per share (EPS) estimate: $4.39
Key Indicators to Watch: Subscriber growth, both domestic and international, Average revenue per user (ARPU), Content spending and production delays, Progress on ad-supported tier and password sharing crackdown
Friday, July 19th
American Express (AXP) - ★★★★
Ranked #53 in Q3 2024 Large Cap Equity Rankings
Earnings per share (EPS) estimate: $3.23
Key Indicators to Watch: Card member spending trends, Net card fees and loan growth, Credit loss provisions
A Look Back
Duolingo's Latest Move: Animation Studio Buyout Fails to Impress Investors
Duolingo (DUOL) - ★★★★
Ranked #5 in Q3 2024 SMID Equity Rankings
Language learning app Duolingo (NASDAQ: DUOL) saw its stock price decline by 5% on Tuesday following news of its latest acquisition. This latest drop contributes to Duolingo's challenging year in the stock market, with shares now down 16% year-to-date. Adding to investor concerns, the stock has been trading below both its 50-day and 100-day moving averages since May 2024, indicating a bearish trend.
source: TradingView
The acquisition brings 12 new team members to Duolingo's design ranks, including motion designers, animators, creative strategists, directors, and producers. Hobbes has already been collaborating with Duolingo as a motion design partner, contributing to key features for Duolingo Music, product architecture, and animation design systems.
While the move appears to align with Duolingo's strategy to enhance its visual and interactive elements, investors seem cautious about the company's expansion efforts. The financial terms of the deal were not disclosed, leaving questions about the acquisition's impact on Duolingo's bottom line.
Electric Dreams: Rivian's Stock Soars as Company Recharges Investor Confidence
Rivian Automotive (RIVN) - ★★
Ranked #67 in Q3 2024 SMID Equity Rankings
Rivian Automotive (RIVN) has recently experienced a significant rebound in its stock performance, breaking above its 50-day moving average and trading above $16 for the first time since February 2024. The stock has shown impressive gains, up 43% in the last month and nearly 60% over the past three months.
This surge comes on the heels of several positive developments for the electric vehicle manufacturer. Rivian reported second-quarter deliveries of 13,790 vehicles, surpassing Wall Street expectations of about 12,000 units and representing a 9% year-over-year increase. While production dipped to approximately 9,600 vehicles in Q2, down from almost 14,000 in Q1 2024, the company maintains its 2024 production target of 57,000 vehicles.
The recent stock price rally can be attributed to multiple factors:
Joint Venture with Volkswagen: A newly formed partnership with Volkswagen, which includes a cash infusion for Rivian, led Wall Street analysts to raise their stock price targets by an average of $3 per share.
Successful Investor Day: Rivian's late June investor day was well-received, as the company outlined plans to reduce costs and move towards profitability.
Industry-wide EV Sector Rebound: The rise in Rivian stock coincides with a broader rally in the EV sector, exemplified by Tesla's (TSLA) nearly 50% increase over the past month.
On June 29, 2024, our 3rd Quarter SMID Equity Rankings for Rivian set a 12-month price target of $15, representing a 12% upside potential from its then-trading price of $13.42. The stock has already surpassed this target, indicating stronger-than-anticipated investor confidence.
source: TradingView
Looking ahead, Rivian's production goals for the second half of 2024 remain ambitious but achievable, with a target of approximately 17,000 vehicles per quarter. The company has demonstrated its ability to produce at this rate in the past.
As the EV market shows signs of recovery after a challenging start to 2024, Rivian's recent performance suggests a potential turning point for the company and the broader electric vehicle industry. Investors and industry observers will be closely watching Rivian's ability to maintain this momentum and deliver on its production and profitability goals in the coming months.
Uber Shares Surge As Tesla Delays Robotaxi Unveiling
Uber (UBER) - ★★★
Ranked #81 in Q3 2024 Large Cap Equity Rankings
Uber (UBER) saw its stock price jump 6% following news that Tesla has postponed the announcement of its highly anticipated robotaxi service. The event, originally scheduled for August 8, 2024, has been pushed back to October, giving Tesla's teams additional time to develop vehicle prototypes for the autonomous taxi service.
The delay, reportedly communicated internally at Tesla, comes as a temporary reprieve for ride-hailing giant Uber, which has been bracing for increased competition in the autonomous vehicle space. Tesla CEO Elon Musk had previously announced the August date in a post on social media platform X, generating significant buzz in the industry.
This news comes on the heels of Musk's recent comments about "crushing" short sellers betting against Tesla's future. The postponement may provide Uber with a brief window to solidify its market position before facing a potentially game-changing competitor.
Uber's stock has been performing well in 2024, up 21% year-to-date. The latest surge suggests that investors see the delay in Tesla's robotaxi unveiling as a positive development for Uber's near-term prospects in the ride-hailing market.
As the autonomous vehicle race heats up, all eyes will be on Tesla's October event and its potential impact on established players like Uber in the transportation sector.
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