Investing

Earnings Previews: Carnival, Huya, Nike, Pinduoduo, Tencent Music

After markets closed on Thursday, FedEx reported quarterly results that missed earnings estimates by $0.06 a share (1.3%) but beat revenue estimates by nearly 10%. Costs related to the Omicron variant, wages and transportation rose, however. The low end of fiscal 2022 earnings guidance came in below the consensus estimate for earnings per share (EPS) of $2.58. Shares traded down about 6% shortly after Friday’s opening bell.

GameStop also reported results and missed EPS estimates by $2.70, posting a loss per share of $1.86, compared to the consensus estimate for EPS of $0.84. The stock traded down more than 5% Friday morning. Brazilian payment technology firm StoneCo missed EPS estimates as well, but it reshuffled senior management and said it expects margins to improve beginning in the current quarter following a pricing adjustment implemented in November.

Here are previews of five companies set to report quarterly results Monday or Tuesday.

Carnival

Cruise line operator Carnival Corp. & PLC (NYSE: CCL) is set to report results before markets open Tuesday. Over the past 12 months, the stock has dropped about 33%, including a decline of about 17% since mid-February. Rising fuel costs hit Carnival and the other cruise line operators hard, accounting for as much as 20% of operating costs. The industry got some good news earlier this week when the CDC lifted its conditional sailing order and lowered the risk levels for cruises.

Analysts continue to tilt toward a favorable view of Carnival, with eight of 20 analysts giving the shares a Buy or Strong Buy rating and another nine assigning a Hold rating. At a recent price of around $19.30 a share, the upside potential based on a median price target of $25.00 is nearly 30%. At the high target of $38.00, the upside potential is 97%.

For the company’s fiscal first quarter, analysts have forecast revenue of $2.26 billion, which would be up 75.3% sequentially and by nearly 10-times year over year. The adjusted loss per share is forecast at $1.21, better than the prior quarter loss of $1.72 and also better than last year’s quarterly loss of $1.79 per share. For the full 2022 fiscal year ending in November, Carnival is expected to post a per-share loss of $1.18, compared with last year’s loss of $7.06 per share. Revenue is forecast to reach $16.12 billion, up about 745% year over year. Carnival posted revenue of $4.79 billion in the quarter that ended in February 2020. Current projects call for November quarter 2022 revenue of $5.02 billion.

Carnival is expected to post EPS of $1.69 in its 2023 fiscal year and $2.36 in fiscal 2024. The stock’s 52-week range is $16.32 to $31.52. The company does not pay a dividend. Total shareholder return for the past year is a negative 31.9%.

Huya

Huya Inc. (NASDAQ: HUYA) will report fourth-quarter results first thing Tuesday morning. The Guangzhou, China-based firm operates live streaming game platforms in China, Southeast Asia and Latin America. Shares have dropped about 80% of their value over the past 12 months, largely due to the harsh rules imposed on tech stocks by the Chinese government. Two ARK Invest exchange-traded funds owned more than 10 million shares of Huya stock two years ago, but that position has since been entirely eliminated.

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