The US March quarter earnings reporting hits peak week with dozens of S&P 500 companies to report led by a handful of giants that will determine the quality of the profit reporting season – Tesla, Apple, Amazon, Microsoft, Facebook, Alphabet (Google), Exxon, BP, Shell and Chevron.
Up to Friday just over 25% of S&P 500 companies had reported – as expected Netflix was the big one from last week and its subscriber shortfall rattled sentiment.
This week there’s another test for the techs and the season as a whole.
So far around 76% of those S&P 500 companies to report have beaten earnings and revenue expectations.
So far, earnings news has been positive, with 86% of companies reporting earnings beats.
Corporate profits are expected to be up about 33.9% for the first quarter, based on estimates and actual reports, according to Refinitiv. Initial forecasts put the rise around 21%. Revenues are up just under 10%.
The AMP’s chief economist, Shane Oliver says the final increase could be between 35% to 40%.
The reports from the oil sector will go a long way to pushing up revenues and earnings this quarter and next seeing a year ago Covid and the lockdowns saw demand and prices collapse – especially in the three months to June.
So just on a comparative basis, the rebound in prices for oil and gas and petrol will see the oil majors reveal surges in revenues and earnings for the March quarter of this year and no doubt some will resume buybacks.
Watch for comments on the pace of recovery, taxes, Covid, inflation and cost rises, and China.
The big tech giants will be joined by the likes of Boeing, Starbucks, Honeywell, Raytheon, Ford, Caterpillar, Comcast and McDonald’s, which will give a good spread of comments and figures from manufacturing, media and consumer facing businesses.
Looking at the major reports this week, Tesla dominates today. Tuesday sees 3M, Mondelez, Alphabet, Starbucks, Microsoft, Raytheon, Visa, Texas Instruments, UPS, AMD, Eli Lilly, BP and Hasbro.
Wednesday sees reports from Apple, Boeing, Rockwell, Ford, Yum Brands, eBay, Moody’s, Discovery, Facebook, Qualcomm, Teck Resources, Hess and Nielsen.
Thursday sees reports from Amazon, Bristol Myers, Merck and Co, McDonald’s, US Steel, Hershey, Comcast, Kraft Heinz, Caterpillar, Mastercard, Twitter, Newmont, S&P Global and Shell.
Friday sees reports from Exxon Mobil, Chevron, Phillips 66 and Colgate Palmolive.
And on May 1, Berkshire Hathaway on Saturday, along with the annual meeting which will again be virtual because of COVIF and from Los Angeles instead of Omaha.
This year question time will expand. Vice chair Charlie Munger missed last year’s meeting but he will be back this year with the meeting coming from Los Angeles, rather than Omaha.
Continuing the theme of last year Greg Abel, who was present last year, and Ajit Jain, who wasn’t, will also answer questions on their domains. Abel focuses primarily on energy and other non-insurance operations.
Jain focuses on insurance. Given the advanced ages of Buffett and Munger this enables Berkshire investors to become more comfortable with Berkshire’s succession planning.
