Investing

Earnings Previews: Activision Blizzard, Amazon, Ford, Snap

Amazon

In mid-July, Amazon.com Inc. (NASDAQ: AMZN) posted a new all-time high share price. For the 12-month period since last February, however, Amazon stock has slipped by about 6.6%. The stock posted a new annual low just last week when it was down about 13.5% over the past 12 months. The recent interest in buying tech stocks helped Amazon cut its share price decline by half. Now, investors want to know if that will continue.

All but one of 50 analysts give Amazon stock a Buy or Strong Buy rating. The lone holdout has a Hold rating on the stock. At a recent share price of around $3,023.90, the upside potential based on a median price target of $4,050 is 33.9%. At the high price target of $5,000, the upside potential is 65.3%.

Analysts are looking for fourth-quarter revenue of $137.63 billion, which would be up 24.2% sequentially and 9.6% higher year over year. Adjusted earnings per share (EPS) are expected to be $3.54, down 42% sequentially and 75% lower year over year. For the full fiscal year, EPS is expected to come in at $40.73, down 2.6%, on sales of $470.13 billion, up 21.8%.

Amazon stock trades at 74.2 times expected 2021 EPS, 60.1 times estimated 2022 earnings of $50.31 and 39.8 times estimated 2023 earnings of $75.99 per share. The stock’s 52-week range is $2,707.04 to $3,773.08. Amazon does not pay a dividend. Total shareholder return over the past 12 months was negative 10.5%.

Ford

Last month, Ford Motor Co. (NYSE: F) reached a milestone $100 billion market cap for the first time since its founding in 1903. Over the past 12 months, Ford’s stock price is up almost 96%, including a drop of more than 22% in the two weeks following its January 14 all-time high. The share price started climbing in late September as order backlog grew for the company’s new all-electric F-150 Lightning pickup.

After EV market leader Tesla reported solid numbers a week ago, some of the bloom came off the rose for legacy automakers now diving into the EV wars. Not only is there a lot of competition, but there are supply chain issues and a veritable laundry list of downside risks. If Ford (or GM, which reported after markets close Tuesday) wants to stay viable, it now has figured out that it has no alternative.

Analysts are a bit mixed on the stock, with 10 of 22 brokerages giving the stock a Buy or Strong Buy rating and nine rating the shares at Hold. At a share price of around $20.70, the upside potential based on a median price target of $23 is 10%. At the high price target of $30, the upside potential is almost 45%.

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