Investing

Earnings Previews: Activision Blizzard, Ford, Peloton and T-Mobile

Another busy day of earnings is on tap for Thursday. We covered two major health care companies in our weekly preview from Sunday: Merck and Bristol-Myers Squibb. On Tuesday, we previewed announcements scheduled to arrive before markets open Thursday morning from eBay, PayPal, Qualcomm, Nokia and Vista Outdoors.

Here’s a preview of four companies that will be reporting quarterly results after markets close Thursday.

Activision Blizzard

Activision Blizzard Inc. (NASDAQ: ATVI) shares posted a gain of more than 57% last year but have added less than 1% so far in 2021. The video game business had a big year in 2020, and 2021 promises to be another good one, at least for Activision. The company will be releasing its “Call of Duty: Mobile” game in the United States this year. The game was launched in late December in China and raked in $14 million in player spending in its first week. The game could add $500 million to the company’s top line this year.

The consensus estimate for quarterly earnings per share (EPS) is $1.18, about 4% lower than the year-ago quarter, on revenue of $2.83 billion, an increase of 4.6% year over year. For the 2020 fiscal year, analysts are forecasting EPS of $3.44, a jump of nearly 53% compared to 2019, and revenue of $8.18 billion, up 28% year over year.

At a current price near $93.50, shares trade at 27.3 times expected 2020 EPS and 26.8 times expected 2021 earnings. The consensus 12-month price target on the stock is $100.79, implying a potential upside of about 7.8%. At the high target of $117, the potential share-price gain is more than 25%. Activision pays a dividend yield of 0.44%.

Ford

Ford Motor Co. (NYSE: F) did not share in the share-price run-ups that tech stocks had last year. The stock dipped about 4% in 2020 but has jumped more than 27% since the beginning of this year. Sales for the year just ended fell by 16% compared to 2019, but the good news was that the average selling price was stronger due to slowdowns in production due to the COVID-19 pandemic.

Total sales dipped more than 8% in January, while retail sales rose 5.5%. Production (and sales) of the all-electric Mustang Mach-E SUV is expected to boost 2021, sales and the company continues to work on an electrified F-150 pickup, so there is some good news ahead.

Analysts are expecting a fourth-quarter net loss of $0.07 a share on sales of $33.9 billion. Ford posted EPS of $0.12 in the same period a year ago on sales of $36.7 billion. For the full year, Ford is expected to post a net loss of $0.01, far below its $1.19 EPS in 2019. Revenue is forecast to be down more than 18% at $117.47 billion.