The three major U.S. equity indexes closed higher on Wednesday. The Dow Jones industrials rose 0.15%, the S&P 500 closed up 0.59% and the Nasdaq saw a gain of 1.58%. High-growth sectors technology (up 1.6%) and communications services (up 1.0%) trailed consumer cyclical stocks (up 1.8%) as the day’s leading gainers. Utilities (down 1.4%) and health care (down 1.1%) lagged. Thursday’s report on new claims for unemployment benefits came in higher than economists were expecting.
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The major indexes were mixed after the first 45 minutes of trading on Thursday, with the Nasdaq and S&P higher while the Dow was lower.
After markets closed Wednesday, Tesla reported better-than-expected results on both the top and bottom lines. Earlier in the day, the company reported selling about 75% of its bitcoin holdings for U.S. dollars due to “uncertainty as to when Covid shutdowns would lift in China.” Shares traded up about 5.9% shortly after Thursday’s opening bell.
Las Vegas Sands missed the consensus earnings per share (EPS) estimate but beat on revenue. The stock traded up about 5.8% Thursday morning.
Kinder Morgan beat estimates on both the top and bottom lines. Shares were up 1% in early trading.
Steel Dynamics also beat top-line and bottom-line estimates. The company said that orders remain strong, although prices for flat-rolled steel are softer. The stock traded up 2.7% early Thursday.
United Airlines missed the consensus EPS estimate but managed to beat (barely) the revenue estimate. Shares traded down by about 8.8%.
Before markets opened on Thursday, AT&T beat estimates on both the top and bottom lines. The telecom giant raised its Mobility service estimate for the year but cut its free cash flow guidance to “reflect heavy investment in growth and working capital impacts related to timing of collections.” Shares traded down 9.5% in early trading Thursday.
Freeport-McMoRan missed both top-line and bottom-line estimates. Shares traded lower by about 3.3%.
Philip Morris beat estimates for both EPS and revenue. The international marketer of Marlboro cigarettes raised full-year EPS guidance. The stock traded up about 5.4%.
We already have previewed four companies (American Express, Snap, Twitter, Verizon) that will report results late Thursday or before U.S. markets open Friday morning. Three more companies (Cleveland-Cliffs, NextEra Energy, Schlumberger) also will report results Friday morning.
Here is a look at three companies set to report results on Monday.
24/7 Wall St.Newmont
Over the past 12 months, gold prices have decreased by about 5.4%, and all that gain has come since early March. Newmont Corp. (NYSE: NEM) has seen its share price fall by about 10.8% over the same 12-month period. Since posting a 52-week high in mid-April, the stock has plunged by more than 38%. Given its recent slide, Newmont’s saving graces may be its dependable dividend and buy-in price. The company is set to report results first thing Monday morning.
Analysts remain cautious on Newmont stock, with 14 of 19 brokerages having a Hold rating, while the rest have Buy or Strong Buy ratings. At a recent price of around $52.30 a share, the upside potential based on a median price target of $77.00 is 47.2%. At the high price target of $100.00, the upside potential is 91.2%.
Second-quarter revenue is forecast at $3.06 billion, which would be up 1.1% sequentially and flat year over year. Adjusted EPS are forecast at $0.67, down 2.8% sequentially and by 19.3% year over year. For the full 2022 fiscal year, estimates call for EPS of $3.05, up 2.9%, on sales of $12.81 billion, up 4.8%.
Newmont stock trades at 17.2 times expected 2022 earnings, 17.0 times estimated 2023 earnings of $3.08 and 18.1 times estimated 2024 earnings of $2.90 per share. The stock’s 52-week range is $52.23 to $86.37. Newmont pays an annual dividend of $2.20 (yield of 4.02%). Total shareholder return for the past year was negative 10.4%.
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NXP Semiconductors
Since posting an all-time high share price in early December, Netherlands-based NXP Semiconductors N.V. (NASDAQ: NXPI) has watched about 25% of that high price melt away. The stock is down about 5% over the past 12 months and posted a 52-week low earlier this month. NXP, which produces chips both at its own fab and with third-party fabs, may be the canary in the coal mine as supply chain, inflation and recession concerns plague the chip industry. NXP reports its results after markets close on Monday.
Of 28 analysts covering the company, 16 have a Buy or Strong Buy rating and 11 more rate the shares at Hold. At a share price of around $178.00, the upside potential based on a median price target of $200.00 is 12.4%. At the high price target of $260.00, the upside potential is 46.1%.
Second-quarter revenue is expected to come in at $3.27 billion, up 4.2% sequentially and 25.8% higher year over year. Adjusted EPS are forecast at $3.38, up 0.3% sequentially and by 41.4% year over year. For full fiscal 2022, analysts are looking for EPS of $13.73, up 27.7%, on sales of $13.1 billion, up 18.5%.
NXP stock trades at 12.8 times expected 2022 EPS, 12.8 times estimated 2023 earnings of $13.78 and 11.7 times estimated 2024 earnings of $15.13 per share. The stock’s 52-week range is $140.33 to $239.91. NXP pays an annual dividend of $3.38 (yield of 1.98%). Total shareholder return for the past 12 months was negative 10%.
Range Resources
Independent oil and gas producer Range Resources Corp. (NYSE: RRC) has posted a 12-month share price increase of about 100%. In early June, the shares were up 150%. Recent analyst calls on the stock have resulted in an upgrade to Overweight at Wells Fargo and a reiterated Sell rating from Goldman Sachs. In other words, nobody knows what will happen with energy prices.
As a group, analysts are cautious. Of 27 brokerages covering the stock, 13 have a Hold rating and 10 have a Buy or Strong Buy rating. At a share price of around $29.80, the stock’s upside potential based on a median price target of $38.50 is 29.2%. At the high price target of $61.00, the upside potential is nearly 105%.
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