Investing

Earnings Previews: Intel, Snap, American Express, Honeywell

Of the dozens of March quarter earnings reports released Wednesday morning, most showed better earnings than analysts were looking for. Two exceptions were Sweden’s Ericsson and U.S. homebuilder NVR.

After markets close Wednesday, we’ll hear from, among others, Lam Research, Kinder Morgan and Chipotle. Before markets open Thursday, Alaska Airlines, American Airlines, AT&T, Freeport-McMoRan, Cleveland-Cliffs and Valero Energy are all on tap to report results.

Here are two companies set to report results after markets close Thursday and two more on the schedule to report earnings before markets open Friday morning.

Intel

Chipmaker Intel Corp. (NASDAQ: INTC) saw its shares sink nearly 15% in 2020. So far in 2021, the stock is up about 27.5%. Rising demand for semiconductors against a limited supply does not necessarily yield more revenue and higher profits. This quarter’s report will be the first under new CEO Pat Gelsinger, and his comments on the conference call may be more important than Intel’s quarterly performance. The Dow 30 component reports first-quarter results after markets close Thursday.

Of 41 brokerages covering Intel, the stock is rated as a Buy or Strong Buy by 23 and at Hold by 13 others. The consensus price target on the stock is $66.26 and, at a recent price of $63.20, upside potential is 4.8%. At the high target of $800, the upside potential is about 52%.

Earnings per share (EPS) for the quarter is forecast at $1.15, down by nearly 21% year over year, and revenue is forecast to fall by 9.9%% to $17.86 billion. The outlook for the fiscal year calls for EPS of $4.57, down by nearly 14% year over with revenue more than 7% lower to $73.32 billion.

Shares trade at around 13.7 times expected 2021 EPS, 13.4 times estimated 2022 earnings and 12.2 times estimated 2023 earnings. The stock’s 52-week range is $43.61 to $68.49, and Intel pays an annual dividend of $1.39 (yield of 2.22%).

Snap

Snap Inc. (NYSE: SNAP) also reports first-quarter results after Thursday’s closing bell. The stock has soared by some 355% over the past 12 months. With its revenue based primarily on advertising on the company’s popular Snapchat social media app, ad revenues are the key metric for analysts and investors. Revenue rose 62% year over year in the prior quarter, and analysts expect that to be around that level again.

What the company has to say about its outlook for the rest of this year now that life appears to be regaining some semblance of normality may have a big impact on how the stock moves after the report is in.

Of 36 firms covering Snap, 20 rate the shares a Hold, while nine put an Underperform rating on the stock and one has the stock rated as a Sell. Only seven rate the shares a Buy or Strong Buy. The consensus price target on the stock is $74.79, and at a recent price of around $58.60, upside potential is 27.6%. At the high target of $100, the upside potential is nearly 71%.

Analysts are forecasting a loss per share for the quarter of $0.05, three cents better than last year’s loss in the same period. Revenue is forecast to soar by nearly 61% to $742.94 million. The outlook for the fiscal year calls for EPS of $0.16, up from a loss of $0.06 last year, with revenue 53% higher to $3.83 billion.

Shares traded Wednesday at around 99.9 times expected 2022 EPS and 48.2 times estimated 2023 earnings. The stock’s 52-week range is $14.85 to $73.59, and Snap does not pay a dividend.