Thursday, June 20, 2024

Earnings week ahead: Oracle, Adobe, Broadcom and more

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Profitability and Growth

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Despite a relatively sparse earnings calendar next week, there are still several notable companies scheduled to release their financial figures. The results have the potential to make a big impact on expectations, not just for specific companies, but also for important industries like consumer staples and enterprise software.

Notably, investors are eager for updates from Oracle (NYSE:ORCL), Adobe (NASDAQ:ADBE), Broadcom (NASDAQ:AVGO), Fuelcell Energy (NASDAQ:FCEL) and Signet Jewelers (NYSE:SIG), among others.

Below is a rundown of major quarterly updates anticipated in the week of June 10 to 14:

Monday, June 10

FuelCell Energy (FCEL)

FuelCell Energy (FCEL) is slated to report its quarterly earnings before the opening bell on Monday. Analysts expect a double-digit decline in revenue compared to last year, while EPS is expected to grow.

The stock, which has lost more than 40% of its value so far in 2024, gets a Hold rating from both Seeking Alpha’s Quant Rating system and Wall Street analysts.

SA investing group leader The Value Pendulum, who has a Hold rating on the stock, writes, “FuelCell Energy’s Q2 FY 2024 results are expected to fall short of expectations, based on the company’s track record and the recent performance of its peers. However, the South Korean market could provide new growth opportunities for FuelCell Energy, and its shares don’t seem to be overvalued.”

  • Consensus EPS Estimates: -$0.08
  • Consensus Revenue Estimates: $21M
  • Earnings Insight: The company has exceeded revenue estimates in 3 of the past 8 quarters, and EPS estimates in 50% of those reports.

Also reporting: Yext (YEXT), Calavo Growers (CVGW), Skillsoft (SKIL), Zedge (ZDGE), MIND Technology (MIND) and more.

Tuesday, June 11

Oracle (ORCL)

Texas-based software giant Oracle (ORCL) is set to release its results after the market closes on Tuesday. Analysts anticipate year-over-year revenue growth but expect a slight decline in profit.

A few days ahead of the earnings report, Seeking Alpha’s Quant Rating system has turned cautious on Oracle, assigning it a Hold rating. Meanwhile, Wall Street analysts have a consensus Buy recommendation.

Seeking Alpha author Mike Zaccardi upgraded Oracle shares from Hold to Buy just ahead of the earnings. He notes: “Semiconductor stocks are outperforming software companies amid an AI arms race, leaving some SaaS firms attractively priced. We need to see strong numbers from its SaaS applications, cloud infrastructure technologies, and products. Specifically, its margins will be closely scrutinized along with the firm’s forward growth outlook.”

  • Consensus EPS Estimates: $1.65
  • Consensus Revenue Estimates: $14.57B
  • Earnings Insight: Oracle has exceeded EPS in 7 of the past 8 quarters and revenue in 4 of those reports.

Also reporting: ZEEKR Intelligent Technology Holding Limited (ZK), Rubrik (RBRK), Mama’s Creations (MAMA), PetMed Express (PETS), Academy Sports and Outdoors (ASO), Qudian (QD), Lilium N.V. (LILM), Casey’s General Stores (CASY), Enzo Biochem (ENZ), Rafael Holdings (RFL), Motorcar Parts of America (MPAA), Streamline Health Solutions (STRM), Yunji (YJ) and more.

Wednesday, June 12

Broadcom (AVGO)

Broadcom (AVGO) is slated to announce its quarterly results after Wednesday’s closing bell, with analysts expecting year-over-year top-line growth of more than 37%.

The California-based semiconductor company’s stock has soared over 25% so far in 2024, riding the wave of AI excitement. However, Wall Street opinions are divided: Sell-Side analysts remain bullish with a Buy rating, but Seeking Alpha’s Quant Rating system gives it a more cautious Hold.

Seeking Alpha author Mike Zaccardi has downgraded the stock from Buy to Hold ahead of earnings results, citing concerns over Broadcom’s stretched valuation and slowed momentum.

Similarly, investing group leader Jonathan Weber, with a Hold rating on the stock, states, “Broadcom’s shares have become expensive, and the dividend yield has dropped, making it less appealing as an investment. While the company’s recent operational performance showed revenue growth, it still lags behind tech companies with more AI exposure. Broadcom’s buyback program has not effectively offset share count dilution, and its valuation is higher than the historic norm.”

  • Consensus EPS Estimates: $10.84
  • Consensus Revenue Estimates: $12.01B
  • Earnings Insight: Broadcom has beaten EPS and revenue estimates in 8 consecutive quarters.

Also reporting: Dave & Buster’s Entertainment (PLAY), Oxford Industries (OXM), Torrid Holdings (CURV), Zhihu (ZH), Vera Bradley (VRA), Affimed N.V. (AFMD), Coda Octopus Group (CODA) and more.

Thursday, June 13

Adobe (ADBE)

Adobe (ADBE) will update investors on its quarterly performance on Thursday after the bell. Following upbeat results in its previous earnings report, the company guided quarterly revenue in the range of $5.25B to $5.30B and adjusted EPS between $4.35 and $4.40. Analysts anticipate both EPS and revenue to grow year-over-year.

Seeking Alpha’s Quant Rating system downgraded the stock to Hold from Buy just a week ahead of its earnings report, while Wall Street analysts maintain a Buy recommendation.

Recently, Oppenheimer lowered its price target on ADBE to $580 from $660 while maintaining an Outperform rating on the stock. Oppenheimer analysts predict a potential reacceleration in Adobe’s stock in the second half of 2024 as pricing headwinds ease, margins improve and investors anticipate greater AI monetization in FY2025.

SA investing group leader Best Anchor Stocks, with a bullish view on Adobe, writes, “Adobe is much more than AI, and simply solving the ideation phase (where most competitors are currently present) is unlikely to pose a threat to the company’s business; monetizable users require much more than just ideation.”

  • Consensus EPS Estimates: $4.39
  • Consensus Revenue Estimates: $5.29B
  • Earnings Insight: Adobe has exceeded EPS consistently in all the past 8 quarters and revenue estimates in 6 of those reports.

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