The three major U.S. equity indexes closed higher Friday. The Dow Jones industrials ended the day up 1.26%, the S&P 500 closed 1.36% higher and the Nasdaq saw a gain of 1.28%. All 11 sectors closed higher, with materials (3.41%) and financials (1.87%) posting the biggest gains. Utilities and healthcare (both 0.57%) had the smallest gains.
This week’s economic calendar includes the monthly report on the consumer price index (CPI). Economists are expecting the Thursday morning release to show that the index increased month over month in October by 0.7%. Core CPI (excluding food and energy) is expected to tick down from 0.6% to 0.5%. The weekly report on new claims for unemployment insurance will be released Wednesday. New claims are expected to rise from last week’s 217,000 to 220,000.
The three major indexes traded higher in the first hour of trading on Monday.
Before markets opened, Palantir Technologies reported a one-penny miss on EPS and revenue in line with expectations. The company lowered fourth-quarter revenue guidance to a new range of $603 to $505 million. Analysts had a consensus estimate of $506.6 million. The stock traded down about 6.9% early Monday.
NiSource reported adjusted earnings per share (EPS) that met the consensus estimate, while revenue of $1.09 billion was better than expected. The company lowered full-year EPS guidance from a prior range of $1.50 to $1.57 to a new range of $144 to $1.46. NiSource also announced a growth plan that it expects to boost adjusted EPS by 6% to 8% annually through 2027. Shares traded down 2.8% Monday morning.
Ballard Power reported inline EPS and missed on revenue. Shares traded down by 3.9% Monday morning.
Activision Blizzard and Lyft take their turns in the earnings spotlight after U.S. markets close on Monday. Before U.S. markets open on Tuesday, Constellation Energy and GlobalFoundries are on deck to report quarterly earnings.
With so many interesting reports due out late Tuesday, we split our coverage into two stories. We already have previewed Affirm, AMC Entertainment and Disney. Here is a look at three more companies set to report quarterly results after U.S. markets close on Tuesday.
24/7 Wall St.Lucid
Electric vehicle (EV) maker Lucid Group Inc. (NASDAQ: LCID) made its public market debut in a SPAC merger late in July of last year. The stock spiked to a 52-week high in mid-November but has dropped by about 74% since then. In mid-October, the company reported that year-over-year production tripled, and the stock has added 6%.
Lucid has had three recalls over the past year that have affected about 1,900 vehicles, more than half its sales. The company expects to deliver 6,000 to 7,000 vehicles this year, but it will need to build about 3,000 to make that number. Lucid produced almost 2,300 vehicles in the third quarter.
Only nine analysts cover the stock, with five having a Buy or Strong Buy rating and two more rating the shares at Hold. At a recent price of around $13.90 a share, the upside potential based on a median price target of $24.00 is 72.7%. Based on the high target of $36.00, the upside potential is almost 160%.
Analysts expect the company to report fiscal 2022 third-quarter revenue of $200.21 million, which would be up 105.7% sequentially and up from $230,000 in the year-ago quarter. The consensus forecast calls for an adjusted loss of $0.30 per share, three cents better than the prior quarter’s loss and 11 cents better than last year’s third quarter. For the full fiscal year, the loss per share is forecast at $0.82, down from last year’s loss of $5.00 per share, on sales of $756.52 million, up nearly 2,700%.
Lucid is not expected to report a profit in 2022, 2023 or 2024. The enterprise value to sales multiple is expected to be 28.1 in 2022. Based on average estimated sales of $2.92 billion and $5.46 billion for 2023 and 2024, respectively, the multiple is 7.6 for 2023 and 3.9 for 2024. The stock’s 52-week range is $11.77 to $57.75. Lucid does not pay a dividend. Total shareholder return for the past year is negative 66.8%.
Occidental Petroleum
Of the oil and gas stocks we cover, shares of Occidental Petroleum Corp. (NYSE: OXY) have posted the largest share price gain (nearly 124%) over the past 12 months. Besides high prices for crude, Warren Buffett has acquired about 20% of the company, and there is no doubt that the Oracle of Omaha’s support has had an influence on Oxy’s share price.
The company, partnered with Canada’s Carbon Engineering, announced last month that the pair would construct a direct-air carbon capture plant in the Permian Basin that can suck 500,000 tons of carbon out of the air. The groundbreaking is set for later this month, and the plant is expected to begin operation in late 2024.
Of 27 brokerages covering the stock, 15 rate the shares at Hold and just nine have a Buy or Strong Buy rating. At a share price of around $74.50, the stock trades above its median price target of $73.50. At the high price target of $110.00, the upside potential is 47.7%.
Third-quarter revenue is forecast at $9.05 billion, down 15.7% sequentially but almost 33% higher year over year. Adjusted EPS are pegged at $2.45, down 22.5% sequentially and up 185% year over year. For the full 2022 fiscal year, analysts currently expect Oxy to report EPS of $10.33, up more than 300%, on revenue of $36.91 billion, up 40.3%.
Occidental stock trades at 7.2 times expected 2022 EPS, 9.3 times estimated 2023 earnings of $7.65 and 11.8 times estimated 2024 earnings of $6.27 per share. The stock’s 52-week range is $26.05 to $77.13. Occidental pays an annual dividend of $0.52 (yield of 0.71%). Total shareholder return for the past year is 123.5%.
Plug Power
Over the past 12 months, hydrogen fuel cell maker Plug Power Inc. (NASDAQ: PLUG) is down by about 62%. The shares reached their 52-week high in late November last year and have dropped by about 66% since then. The company got a boost from a new federal tax credit to support added production of green hydrogen, but the effect did not last because the company canceled plans for two of three planned green hydrogen plants and said the third would be delayed. The stock has plunged by around 50% in the past two months.
Of 30 analysts covering the stock, 22 have a Buy or Strong Buy rating and the rest have Hold ratings. At a share price of around $14.75, the implied gain based on a median price target of $31.00 is 110%. At the high target of $78.00, the implied gain is about more than 400%.
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