In early trading Thursday, the Dow Jones industrials were up 0.25%, the S&P 500 up 0.62% and the Nasdaq up 1.21%.
After U.S. markets closed on Wednesday, Chewy reported better-than-expected earnings per share (EPS) and revenue, primarily due to higher prices for pet food. Sales of non-discretionary pet items rose 18.5%, the company said. Hard-to-please investors want to know where Chewy and its rivals expect to get growth going forward. Shares traded down more than 5% Thursday morning.
KBHome also beat consensus estimates on the top and bottom lines. Deliveries of new homes were down 3% year over year but selling prices rose 2% to an average of $494,500. Fiscal 2023 revenue guidance was in line with expectations. Shares traded up 7% early Thursday.
Before U.S. markets opened on Thursday, Accenture reported EPS and revenue above estimates and issued current quarter guidance in line with consensus estimates. Guidance for fiscal 2023 was above the current estimates. Shares traded up 4%.
Darden Restaurants also beat top-line and bottom-line estimates as overall same-store sales rose nearly 12%. The owner of the Olive Garden and Longhorn Steakhouse chains raised the top end of EPS guidance and the revenue above estimates for the 2023 fiscal year. Shares traded up 0.7%.
General Mills reported sales and profits above expectations and issued upside guidance for full-year EPS and organic net sales. Shares traded up 3.4%.
Here is a preview of what to expect when these two companies report results first thing Monday morning.
BioNTech
Germany-based BioNTech S.E. (NASDAQ: BNTX) and Pfizer developed one of the first COVID-19 vaccines, driving the German company’s share price up by more than 800%. Shares are still up nearly 200% over the past three years since that August 2021 peak. In the past 12 months, however, shares have fallen by about 23.5%.
BioNTech has built a cash pile of nearly $13.2 billion and dropped $200 million of that on a private U.S. firm called OncoC4, developers of a new cancer drug that will have to take on Bristol-Myers Squibb’s Yervoy and AstraZeneca’s Imjudo antibody immunotherapy treatments.
Rival Moderna said Wednesday that it will begin pricing its COVID-19 vaccine at $130 per dose when its federal contracts expire later this year. BioNTech had previously indicated it was considering a price between $110 and $130 per dose. This may just be an opening gambit, but it is not a good look for either Moderna or BioNTech.
Of 16 analysts covering BioNTech, eight have a Hold rating and eight more rate the stock as a Buy or Strong Buy. At a recent price of around $133.70 a share, the upside potential based on a median price target of $213.91 is 60%. At the high target of $302.00, the upside potential is about 126%.
Fourth-quarter revenue is expected to come in at $4.22 billion, which would be up 24.3% sequentially and down 33% year over year. Adjusted earnings per share (EPS) are forecast at $8.26, up 20.8% sequentially and down 40.4% year over year. For the full 2022 fiscal year, analysts expect BioNTech to report EPS of $37.08, down 17.8%, on sales of $18.09 billion, down 16.3%.
BioNTech stock trades at 3.6 times expected 2022 EPS, 9.3 times estimated 2023 earnings of $14.39 and 15.4 times estimated 2024 earnings of $8.70 per share. The stock’s 52-week trading range is $117.08 to $189.07. BioNTech paid a special cash dividend of $2.13 in June 2022 but has not established an annual dividend. The company’s total return to shareholders over the past year was negative 22.71%.
Carnival
Shares of cruise ship operator Carnival Corporation & PLC (NASDAQ: BNTX) have had another tough year. Over the past 12 months, Carnival stock has dropped about 53%. Since the pandemic began in February 2020, shares are down about 79%.
Carnival has posted 11 consecutive money-losing quarters, although it beat the consensus estimate in its December quarter. The stock rose more than 50% in the first six weeks of this year but has dropped more than half that gain since then. If the company misses estimates when it reports earnings or has indifferent guidance, the stock could take another tumble.
Analysts remain cautiously optimistic on the stock, with nine of 21 analysts having a Buy or Strong Buy rating and another eight having Hold ratings. At a share price of around $9.00, the upside potential based on a median price target of $10.00 is 11.1%. At the high target of $22.00, the upside potential is 144.4%.
For the company’s first quarter of fiscal 2023, analysts have forecast revenue of $4.3 billion, up 12.1% sequentially and by 165% year over year. The company reported revenue of $1.62 billion in the same period a year ago. The adjusted loss per share is forecast at $0.60, better than the prior quarter’s loss per share of $0.85 but much better than last year’s quarterly loss of $1.66 per share.
For the full fiscal year that ends in November, Carnival is expected to post a per-share loss of just $1.85, compared with last year’s loss of $4.67 per share. Revenue is forecast to reach $20.98 billion, up 72.5% year over year. Carnival posted revenue of $12.17 billion in fiscal year 2022.
Carnival is expected to post earnings of $0.92 in its 2024 fiscal year and $1.21 in fiscal 2025. The stock’s 52-week range is $6.11 to $21.50. The company does not pay a dividend. Total shareholder return for the past year is a negative 52.51%.
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