Industrials

7 Key Dow Earnings for the Week Ahead

Earnings season for the fourth quarter of last year has kicked off, and 24/7 Wall St. has put together a preview of some of the Dow Jones Industrial Average companies that are reporting their quarterly results this week. We included the consensus earnings estimates from Thomson Reuters and the stock price and trading history, as well as added some additional color on each.

Be advised that the earnings and revenue estimates may change ahead of the formal reports, and some companies may change reporting dates as well.

For more previews of the big earnings in the week ahead, see Top 8 Top Earnings to Look for Next Week.

IBM

International Business Machines Corp. (NYSE: IBM) is set to report its fourth-quarter results on Tuesday. The analysts’ consensus estimates call for EPS of $4.81 and $22.04 billion in revenue. This company is a Dog of the Dow member due to poor performance. While IBM has raised its dividend and keeps buying back stock, its shares were down by 11.4% in 2015. The 3.78% dividend yield may not be enough to stave off declining core business concerns and lower backlogs. IBM just cannot grow its new efforts fast enough to make a huge dent. IBM is even considered a classic value trap because no one is willing to pay over 10 times earnings here.

Shares were changing hands at $130.03 on Friday’s close. The consensus analyst price target is $147.75, and the stock has a 52-week trading range of $128.87 to $176.30.


UnitedHealth

UnitedHealth Group Inc. (NYSE: UNH) is expected to share its latest quarterly earnings on Tuesday. The consensus estimates call for EPS of $1.38 and $43.26 billion in revenue. This company offers the full spectrum of health benefit programs for individuals, employers and Medicare and Medicaid beneficiaries, and it contracts directly with more than 850,000 physicians and care professionals and 6,000 hospitals and other care facilities. The company offers a broad spectrum of products and services through two distinct platforms: UnitedHealthcare, which provides health care coverage and benefits services, and Optum, which provides information and technology-enabled health services.

Shares closed at $109.27 on Friday, in a 52-week trading range of $95.00 to $126.21. The consensus price target is $142.57.

Goldman Sachs

On Wednesday, Goldman Sachs Group Inc. (NYSE: GS) is set to report its latest results. The consensus estimates are for EPS of $3.53 and revenue of $7.14 billion. This investment bank has the dubious honor of being one of the worst performing Dow stocks in 2016, with a loss through Thursday’s close of about 10.5%. Goldman Sachs recently has had issues trading the market and that could very well be why the stock is leading the DJIA down. In the first week of the year, broad markets across the world tanked, and Goldman Sachs holdings went down with them.

Shares changed hands at the end of the week at $155.61. The consensus price target is $205.71. Shares have traded between $153.81 and $218.77 in the past year.

American Express

American Express Co. (NYSE: AXP) is scheduled to report its fourth-quarter results on Thursday. The consensus analyst estimates call for $1.13 in EPS and revenue of $8.29 billion. This company was at the mercy of the strong dollar over the course of 2015, and that appears to be the case for this year as well. This stock is down over 8% in just this second week of trading. Sure, falling broad markets this month had an impact in pulling this stock down, but the prevailing market conditions and the currency overhang will prove to be tough to overcome.

Shares of American Express were at $62.91 on Friday’s close. The consensus price target is $78.54. The 52-week trading range is $61.51 to $87.72.

Travelers

Also on Thursday, Travelers Companies Inc. (NYSE: TRV) is set to report its fourth-quarter results. The analysts’ consensus estimates call for EPS of $2.64 and $5.93 billion in revenue. Merrill Lynch sees risks to Travelers: the departure of any key management, a resurgence of asbestos or environmental claims, a more hostile stance by state insurance commissioners and a spike in the frequency or severity of insurance claims. Additional risks noted were potential future acquisition activity, increased losses in the surety line, a more dramatic deterioration in the credit environment, poor results in alternative investments and more intense competitive conditions than expected.

Shares of Travelers were changing hands at $105.10 as last week came to a close. The consensus price target is $111.19, and the stock has a 52-week trading range of $95.21 to $116.48.

Verizon Communications

Verizon Communications Inc. (NYSE: VZ) is scheduled to reveal its fourth-quarter results on Thursday. The consensus estimates call for $0.88 in EPS, as well as $34.04 billion in revenue. The company is the top Dog of the Dow for 2016. A year earlier it had been AT&T, but now AT&T is out. Verizon barely outperformed the market in 2015, with a 3.6% total return, but that current 4.89% dividend yield was the single driving force. Verizon is still in a price war, but no one expects its business to come apart. It is also cheaply valued at about 10 times forward earnings.

Shares were trading at $44.43 on Friday’s close. The consensus price target is $50.33. The stock has a 52-week trading range of $38.06 to $50.86.


GE

Look for General Electric Co. (NYSE: GE) to report its fourth-quarter results on Friday. The analysts’ consensus estimates call for EPS of $0.49 and $35.93 billion in revenue. GE was the top conglomerate of 2015 and blew out expectations on all fronts. That means that during the market carnage it was sold off the most as well. GE was the tenth worst performer, down nearly 7% so far in 2016 as of Thursday’s close, and remember that GE will be buying back billions worth of stock in 2016. Now the question is whether the big gains in 2015 ate all of 2016’s potential gains.

Shares of GE closed at $28.49 on Friday. The consensus price target is $32.38, and the 52-week trading range is $19.37 to $31.49.

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