Investing

Earnings Previews: Amgen, Simon Property, Tenet Healthcare

Paul Ausick

Published: February 4, 2022 12:31 pm

While not quite the shock that Meta Platforms sprung on Wednesday, two companies that reported after markets closed Thursday have reversed the sentiment that prevailed. Amazon easily beat profit estimates, and Snap had better growth numbers, along with solid profit and revenue gains, to gain back even more than the drop of 23% suffered Thursday thanks to Meta.

There are no earnings reports due out after markets close Friday. Thursday, we previewed two notable earnings reports due out before Monday’s opening bell: ON Semiconductor and Tyson Foods.

Here is a look at three firms scheduled to report results after markets close on Monday.

Amgen

Dow Jones industrial average component Amgen Inc. (NASDAQ: AMGN) has seen its share price decline by about 3.5% over the past 12 months. During that period, its biggest advance had been about 10% in mid-April. Shares sank to a 52-week low that was 13.5% below the price on February 4 of last year. The company’s focus on anti-cancer treatments got a boost on Wednesday when President Biden restarted a “Cancer Moonshot” program with the goal of reducing cancer deaths by half over the next 25 years.

Brokerage firms remain a bit cautious on Amgen, with 17 of 27 putting Hold ratings on the stock and another six with a Buy or Strong Buy rating. At a recent share price of around $221.50, the implied gain based on a median price target of $232.50 is 5%. At the high price target of $292, the implied gain is 31.8%.

Estimates for the fourth quarter of fiscal 2021 call for revenue of $6.88 billion, which would be up 2.6% sequentially and 3.8% year over year, while adjusted earnings per share (EPS) are pegged at $4.05, down 13.3% sequentially but up about 6.3% year over year. For the full fiscal year, analysts are looking for EPS of $16.84, a gain of 1.4% year over year, and sales of $26.01 billion, up 2.3%.

Amgen stock trades at 13.2 times expected 2021 EPS, 12.5 times estimated 2022 earnings of $17.78 and 11.5 times estimated 2023 earnings of $19.37 per share. The stock’s 52-week range is $198.64 to $261.00, and the company pays an annual dividend of $7.76 (yield of 3.46%). Total shareholder return over the past year was negative 3.58%. Amgen made it on the list of 2022’s Dogs of the Dow.

Simon Property

Simon Property Group Inc. (NYSE: SPG) is a real estate investment trust (REIT) that owns more than 200 U.S. shopping malls and other retail properties and some 32 retail properties globally. The company is the largest mall and shopping center management company in the United States. Since posting a 52-week high in early November, the shares have dropped nearly 16%, but they have still managed to put up a 12-month price gain of more than 59%.

Brokerage firms are optimistic about Simon’s prospects, with 11 of 20 putting Buy or Strong Buy ratings on the shares and the other nine rating the shares at Hold. At a share price of around $142.10, the implied gain based on a median price target of $177 is 24.6%. At the high price target of $200, the implied gain is nearly 41%.

Estimates for the fourth quarter of fiscal 2021 call for revenue of $1.26 billion, down 2.6% sequentially but up 11.5% year over year. Adjusted EPS are forecast at $1.45, up 22.5% sequentially and about 59.3% year over year. For the full fiscal year, analysts are looking for EPS of $5.64, a gain of 44.5% year over year, and sales of $4.98 billion, up 8.1%.

Simon’s shares trade at 25.1 times expected 2021 EPS, 23.6 times estimated 2022 earnings of $6.02 and 22.2 times estimated 2023 earnings of $6.39 per share. The stock’s 52-week range is $92.92 to $171.12, and the company pays an annual dividend of $6.60 (yield of 4.41%). Total shareholder return over the past year was 56.2%.

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Tenet Healthcare

Health care services company Tenet Healthcare Corp. (NYSE: THC) operated 65 hospitals and some 550 other health care facilities across the United States at the end of 2020. Over the past 12 months, the company’s stock price has risen by about 42%, including a dip of around 13% for 2022 so far. Tenet has beaten profit and revenue estimates in each of the past four quarters. Even though the company lowered fourth-quarter EPS guidance when it reported third-quarter results, the shares had been moving higher.

Analysts are mostly optimistic, with 10 of 27 putting Buy or Strong Buy ratings on the shares and the other seven having a Hold rating. At a share price of around $71.00, the implied gain based on a median price target of $89.00 is 25.4%. At the high price target of $120, the implied gain is 69%.

Estimates for the fourth quarter of fiscal 2021 call for revenue of $5.01 billion, up 2.4% sequentially and 1.8% higher year over year. Adjusted EPS are forecast at $1.49, down 25% sequentially and down from $4.72 in the year-ago quarter. For the full fiscal year, analysts are looking for EPS of $6.32, a drop of 20.1% year over year, and sales of $19.65 billion, up 11.4%. Last year’s EPS included $446 million in grant income (about $4.20 per share outstanding).

Tenet’s shares trade at 11.2 times expected 2021 EPS, 10.7 times estimated 2022 earnings of $6.62 and 9.8 times estimated 2023 earnings of $7.30 per share. The stock’s 52-week range is $48.20 to $83.69, and the company does not pay a dividend. Total shareholder return over the past year was 42.7%.