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Earnings Previews: ASML, IBM, Netflix, NextEra, Verizon

ASML doesn’t get a lot of analyst coverage, with five of seven firms rating the stock Buy or Strong Buy and the other two with Hold ratings. The consensus price target on the stock is $720.25, and at a recent price of $627.90, upside potential is 14.7%. At the high target of $806, the upside potential is about 28.4%.

EPS for the quarter is estimated at $2.60, down nearly 20% year over year, and revenue is forecast to dip 6.4% to $4.83 billion. The outlook for the fiscal year brightens, however, to EPS of $10.50, up nearly 24% year over with revenue more than 18% higher to $16.94 billion.

Shares trade at around 42.3 times expected 2021 EPS, 34.9 times estimated 2022 earnings and 29.8 times estimated 2023 earnings. The 52-week trading range is $275.96 to $653.00, and ASML pays a dividend of $3.28 (yield of 0.51%).

NextEra Energy

NextEra Energy Inc. (NYSE: NEE) also reports quarterly results before markets open Wednesday. Monday morning the regulated utility company’s publicly traded limited partnership, NextEra Energy Partners, announced that it had purchased 391 megawatts of wind generation capacity in California from Brookfield Renewable for a base price of $733 million. NextEra Energy’s share price rose by nearly 33% last year. For a brief spell in October, NextEra was the largest energy company in the United States, bigger even than Exxon Mobil or Chevron.

Of the 15 analyst ratings on the stock, 13 are Buy or Strong Buy. The stock’s consensus price target is $87.33, and shares traded recently at $79.80, implying upside potential of about 9.5%. At the high target of $101, the potential upside is more than 26%.

Analysts expect the stock to post EPS of $0.58, a penny below its EPS in the same quarter last year. Revenue is projected to reach $4.86 billion, up 5.4% year over year. For the full year, EPS is forecast at $2.51, about 8.7% higher, and revenue is expected to rise to $20.6 billion, up 14.5%.

NextEra Energy’s stock trades at a multiple of 30.2 times expected 2021 EPS, 27.4 times estimated 2022 earnings and 25.2 times estimated 2023 earnings. The stock’s 52-week range is $55.65 to $87.69, and the company pays an annual dividend of $1.54 (yield of 1.90%).

Verizon

Like IBM, Verizon Communications Inc. (NYSE: VZ), is a Dow Jones industrial average component, and it will report March-quarter results before the opening bell Wednesday. The telecom giant last week announced that it is expanding its fixed-wireless 5G business network to 21 more cities, bringing to 24 the cities where the high-speed network will be available. Share prices increased by about 4.2% last year.

Two-thirds of the 32 analysts with ratings on the stock have it pegged as a Hold, with the other eight rating the stock either a Buy or a Strong Buy. The consensus price target on the shares is $59.83, about $1.50 higher than a recent trading price of $58.28. The high target is $65, implying upside potential of about 11.5%.

For Verizon’s first quarter, analysts are expecting EPS of $1.29, three cents higher than the same quarter last year, with revenue of $32.47 billion, up 2.7% year over year. For the full year, estimates call for EPS of $5.08, up about 3.7%, on sales of 133.09 billion, which also would be a 3.7% gain.

Shares currently trade 11.5 times expected 2021 EPS, 11.3 times estimated 2022 earnings and 11.1 times expected 2023 earnings. The stock’s 52-week range is $52.85 to $61.95. Verizon pays an annual dividend of $2.51 (yield of 4.31%).