After U.S. markets closed on Thursday, railroad operator CSX met the consensus estimate for earnings per share (EPS) and barely missed Wall Street’s revenue estimate. Intermodal (container) volume was down 18% year over year. Shares traded down 4.6% shortly after Friday’s opening bell.
Intuitive Surgical reported better-than-expected EPS and revenue, but sales of its da Vinci robotic surgery device did not rise to the level investors were hoping for. Shares traded down 3.2% Friday morning.
Before U.S. markets opened on Friday, American Express beat the analysts’ EPS estimate but missed by about 2.3% on revenue. Year over year, however, revenue was up more than 12% to a record, and EPS reached an all-time high. Credit card spending reached an all-time high, and the company added another $100 million to its credit loss provision, bringing its total backstopping fund to $1.2 billion. That contributed to a share price decline of around 3.9% in early trading on Friday.
Schlumberger, like Amex, beat on profits and missed on revenue. The EPS beat was a single penny, while adjusted EBITDA rose by 10% sequentially and 28% year over year. Expenses, however, rose 16.7% sequentially and 20.8% year over year. Diluted EPS was higher sequentially but down 47% year over year. The stock traded down 2.5% Friday morning.
No earnings reports of note are due after U.S. markets close Friday or before they open on Monday. Here is a look at three companies set to report quarterly results late Monday.
Cadence Design Systems
Shares of Cadence Design Systems Inc. (NASDAQ: CDNS) posted a new all-time high on Thursday. The shares have added more than 45% over the past 12 months, thanks to a boost of nearly 49% since the beginning of the year. The company’s AI-assisted chip design systems have driven the stock to these new highs. Cadence announced Thursday that it has acquired intellectual property (IP) from Rambus that is in demand for a variety of AI, data center and hyperscale applications.
As a group, analysts are solidly bullish. Of 15 brokerages covering the stock, 14 have a Buy or Strong Buy rating and two more have Hold ratings. At a recent price of around $239.00 a share, the stock’s upside potential based on a median price target of $248.00 is about 3.8%. At the high price target of $300.00, the upside potential is 25.5%.
For the second quarter, Cadence is expected to report revenue of $977.39 million, which would be down by 4.3% sequentially but up 14.0% year over year. Adjusted EPS are forecast at $1.19, down 7.5% sequentially and 10.2% higher year over year. For the full 2023 fiscal year, analysts are looking for EPS of $5.03, up 17.8%, and revenue of $4.06 billion, up 13.9%.
Cadence stock trades at 47.5 times expected 2023 EPS, 41.3 times estimated 2024 earnings of $5.79 and 36.6 times estimated 2025 earnings of $6.53 per share. Its 52-week trading range is $138.76 to $248.16, and the company does not pay a dividend. Total shareholder return for the past 12 months was 45.59%.
24/7 Wall St.Cleveland-Cliffs
Shares of iron ore miner and steelmaker Cleveland-Cliffs Inc. (NYSE: CLF) have dropped by about less than 1% over the past 12 months, including a boost of 2.4% so far in 2023.
In May, Cleveland-Cliffs reached an agreement with the machinists union at the plant it acquired from Arcelor Mittal for $1.1 billion in 2020. Earlier this week, about 400 workers at the company’s iron ore pellet facility joined the United Steelworkers union. The union represents about 2,000 workers in the company’s mines in Minnesota and northern Michigan.
Cleveland-Cliffs stock took off after the Arcelor Mittal deal, improving by about 190% since. However, it still trails rivals U.S. Steel and Steel Dynamics for overall stock performance for the period and for the past 12 months.
Of 12 brokerages covering the stock, five have a Buy or Strong Buy rating and the others rate it at Hold. At a price of around $16.50 a share, the implied gain based on a median price target of $19.00 is 15.2%. At the high price target of $27.00, the upside potential is 63.3%.
Analysts forecast second-quarter revenue of $5.79 billion, up 9.3% sequentially but 8.7% lower year over year. Analysts anticipate adjusted EPS of $0.70, up from a per-share loss of $0.11 in the prior quarter and down by 46.6% year over year. For the full 2023 fiscal year, analysts expect Cliffs to report EPS of $1.58, down 40%, on sales of $21.67 billion, down 5.7%.
The stock trades at 10.4 times expected 2023 EPS, 8.2 times estimated 2024 earnings of $2.01 and 9.2 times estimated 2025 earnings of $1.80 per share. The 52-week trading range is $11.82 to $22.83, and the company does not pay an annual dividend. Total shareholder return over the past year was negative 0.6%.
NXP Semiconductors
Over the past 12 months, Netherlands-based NXP Semiconductors N.V. (NASDAQ: NXPI) has seen its share price rise by more than 20%, including a gain of more than 34% so far in 2023.
Demand for chips from the auto industry and networking companies that produce equipment for 5G networks has remained strong, and these markets are among NXP’s most important. Earlier this month, the company said that China’s announced restrictions on exports of gallium and germanium are not expected to have a material effect on its business. In May, NXP boosted its dividend by 20%.
Of 28 analysts covering the company, 14 have a Buy or Strong Buy rating and the rest rate the stock at Hold. At a share price of around $212.00, the stock trades within a dollar of its $212.50 median price target. At the high price target of $250.00, the upside potential is nearly 18%.
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