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Earnings Previews: Rite Aid, Taiwan Semiconductor, UnitedHealth

While there were a few interesting earnings reports out Tuesday morning, all eyes were focused on the U.S. Labor Department’s monthly consumer price index (CPI) report. For the month of March, the CPI rose by 1.2% month over month and by 8.5% year over year. Core CPI, excluding food and energy, rose 0.3% sequentially and by 6.5% year over year. Stocks reacted by rising in the premarket session and were indicated to open the regular session on a slight upswing.

Among companies reporting earnings Tuesday morning, Canada-based marijuana grower OrganiGram jumped by more than 9% in premarket trading after beating estimates on both the top and bottom lines. CarMax reported a miss on profits and shares fell by around 8% at one point in premarket trading. Albertsons beat estimates on both the top and bottom lines, but guidance was no better than lukewarm.

Wednesday more or less marks the beginning of the March-quarter earnings season. We already have previewed four companies set to report results before markets open Wednesday (Bed Bath & Beyond, BlackRock, Delta Air Lines, JPMorgan) and four big bank reports due out first thing Thursday (Citigroup, Goldman Sachs, Morgan Stanley, Wells Fargo).

Here is a look at three more companies set to report results Thursday morning.

Rite Aid

Retail drugstore operator Rite Aid Corp. (NYSE: RAD) reports fiscal 2021 fourth-quarter results before Thursday’s opening bell. Over the past 12 months, the share price has plunged by about 62%. Shares have trended down since late last June, and for the year to date, shares currently trade down nearly 48%. A recent analyst report on the company suggests that it could fail and slapped a Sell rating on the stock, along with a price target of $1.

Just three analysts pay attention to the shares, and none rates them above a Sell. At a recent price of around $7.75 a share, the stock traded above its median price target of $7.00. Upside potential based on a high price target of $12.00 is 54.8%.

Fourth-quarter revenue is expected to come in at $5.95 billion, which would be up by less than 1% sequentially and 2.2% higher year over year. The adjusted loss per share is forecast at $0.57, compared to earnings per share (EPS) of $0.15 in the prior quarter and a loss per share of $0.78 in the fourth quarter of last year. For the full fiscal year that ended in February, Rite Aid is expected to post a loss per share of $0.67, compared to last year’s loss of $0.15. Revenue is expected to increase by 1.8% to $24.46 billion.

Rite Aid is also not expected to post a profit in either 2023 or 2024. The company’s enterprise value to sales multiple for the three fiscal years is 0.3. The stock’s 52-week trading range is $6.11 to $23.02. Rite Aid does not pay a dividend. Total shareholder return for the past year was negative 61.5%.

Taiwan Semiconductor

Last week, Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE: TSM) posted its monthly revenue report. For the first quarter of 2022, revenue totaled $17 billion, an increase of 36% year over year. Revenue for March totaled $5.95 billion, up 33.2% compared to March 2021. Despite supply chain issues and the impact of the coronavirus pandemic, demand for gadgets like smartphones and smart TVs remains strong. The company also said it has no current plans for a downward revision of either its sales or capital spending guidance.

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