Quarterly results reported after the closing bell on Tuesday led to sharp changes in several tech stocks. Alphabet and AMD both smashed estimates, while PayPal and Starbucks either missed or guided below expectations or both.

After markets close Wednesday, four firms will report quarterly results: Meta Platforms, Qualcomm, Spotify and T-Mobile. We also have previewed three companies set to release results before markets open on Thursday: ConocoPhillips, Honeywell and Merck.
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Here is a look at four firms scheduled to report results after Thursday’s closing bell.

Activision Blizzard

Unless you have just returned from a trip to Mars, you know that Microsoft is splashing out nearly $70 billion in cash ($95 a share) to acquire game maker Activision Blizzard Inc. (NASDAQ: ATVI). The deal is supposed to give Microsoft a strong toehold in the coming real-life battles over the metaverse.

Bloomberg Wednesday morning cited an unnamed source who claims that the U.S. Federal Trade Commission will conduct an antitrust review of the proposed merger. It is probably fair to say that Activision would have dropped 30% of its value over the past 12 months were it not for the Microsoft deal. As it is, the company’s stock is still down 13%.

There have been no changes in the ratings since the Microsoft deal was announced. What would be the point? Still, it is instructive to look at the ratings to get a feel for what Microsoft hopes to own. Of 27 brokerages covering the firm, fewer than half (12) have Buy or Strong Buy ratings on the stock. The other 15 rate the stock at Hold. At a share price of around $79.10, the upside potential based on Microsoft’s offer of $95 is 20%. At the high price target of $113, the upside potential is 43%. Does someone expect another bid for Activision? Not likely.

Analysts have forecast fourth-quarter revenue of $2.83 billion, up about 50% sequentially but down 7.2% year over year. Adjusted EPS are forecast at $1.32, up 82% sequentially and 8.2% year over year. For full fiscal 2021, consensus estimates call for EPS of $3.76, up 7.6%, on sales of $8.72 billion, up 3.6%.

Activision stock trades at 21.0 times expected 2021 EPS, 21.0 times estimated 2022 earnings of $3.76 and 17.4 times estimated 2023 earnings of $4.53. The stock’s 52-week range is $56.40 to $104.53, and the company pays an annual dividend of $0.47 (yield of 0.59%). Total shareholder return for the past year was negative 15.5%.

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.
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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%.
Ford’s fourth-quarter revenue is forecast at $35.63 billion, up 7.3% sequentially and 7.2% year over year. Adjusted EPS are forecast at $0.41, down 19.2% sequentially but up 20.6% year over year. For full fiscal 2021, consensus estimates call for EPS of $1.85, up 350%, on sales of $126.66 billion, up 9.3%.

Ford stock trades at 11.2 times expected 2021 EPS, 10.1 times estimated 2022 earnings of $2.04 and 8.8 times estimated 2023 earnings of $2.35 per share. The stock’s 52-week range is $10.71 to $25.87. Ford pays an annual dividend of $0.40 (yield of 1.97%). Total shareholder return for the past year was 92.8%.
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Snap

In the past two days, five brokerages have taken some action on Snap Inc. (NYSE: SNAP). Four of the five rate the stock the equivalent of a Buy, and the other rates it at Hold. Over the past 12 months, the stock has dropped 37%. Since reaching its latest 52-week high in late September, the stock is down nearly 60%. What analysts are betting on is higher daily active user (DAU) numbers, which they understand to mean that Snap is not going to get steamrolled by TikTok.

There are a total of 37 brokerages covering Snap stock. Analysts are solidly bullish, with 28 giving the stock a Buy or Strong Buy rating and nine rating the shares at Hold. At a share price of around $33.70, the upside potential based on a median price target of $65 is nearly 93%. At the high price target of $85, the upside potential is 152%.

Fourth-quarter revenue is forecast at $1.2 billion, up 12.6% sequentially and 31.7% year over year. Adjusted EPS are forecast at $0.10, down 40% sequentially but 10% higher year over year. For the full 2021 fiscal year, consensus estimates call for EPS of $0.36, compared to last year’s loss of $0.06 per share, on sales of $4.02 billion, up 60.4%.

Snap stock trades at 92.5 times expected 2021 EPS, 64.0 times estimated 2022 earnings of $0.53 and 30.1 times estimated 2023 earnings of $1.12 per share. The stock’s 52-week range is $28.02 to $83.34. Snap does not pay a dividend and total shareholder return for the past year was negative 42.8%.

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