Of nearly 40 companies in our watch list that reported earnings late Thursday or before markets opened Friday, a full one-quarter posted negative earnings surprises, and just one met expectations exactly. Nearly half (17) missed revenue estimates, and two others matched analysts’ estimates.
Missing Wall Street’s revenue estimates is arguably a more serious offense than missing earnings estimates, as both Snap and Intel found out Friday morning.
We already have previewed three companies scheduled to report September-quarter results before markets open on Monday: Kimberly-Clark, Otis Worldwide and Restaurant Brands.
Here’s a look at one company scheduled to report results after markets close Monday and four more reporting before markets open Tuesday.
After markets close Monday, Facebook Inc. (NASDAQ: FB) will report third-quarter 2021 results. The social media giant’s stock price has grown by about 28% over the past 12 months, but since reporting second-quarter results in late July, the stock is down nearly 8.5%.
Facebook has suffered from issues that are arguably of its own making. Comments from Snap CEO Evan Siegel following Snap’s quarterly report Thursday evening have weighed on Facebook shares Friday morning. Snap’s ad revenues took a hit in the third quarter, and the company lowered its revenue outlook for the fourth quarter, citing ad revenue declines due to Apple’s tracking transparency initiative. Investors appear to believe that Facebook faces the same headwind.
Analysts don’t appear to share those doubts. Of 52 brokerages covering Facebook, 33 have given the shares a Buy rating and 10 more have a Strong Buy rating on the stock. Of the remaining nine, seven have given the stock a Hold rating. At a recent price of around $327.80, the upside potential based on a median price target of $425 is nearly 30%. At the high price target of $500, the upside potential is 52.5%.
Facebook is expected to report third-quarter revenue of $29.53 billion, which would be up 1.5% sequentially and up 37.5% year over year. Adjusted earnings per share (EPS) is forecast at $3.17, down 12.2% sequentially but up 32% year over year. For the full year, revenue is currently forecast at $119.5 billion, up 39%, and EPS are expected to come in at $14.10, up nearly 40%.
Facebook stock trades at 24.2 times expected 2021 EPS, 21.4 times estimated 2022 earnings and 18.4 times 2023 earnings. The stock’s 52-week range is $244.61 to $384.33. Facebook does not pay a dividend.