Several technology companies have already issued warnings for the earnings reports they will be posting in the week ahead. While this might make some investors worried about the quality of earnings, what the companies have also done is potentially set the bar very low. In short, some reactions could be that things don’t look as bad as was first thought. As a result, this earnings season is likely to be all about guidance from the big tech shops.
24/7 Wall St. has put together a preview of some of the larger companies in the tech and media sector reporting their quarterly results in the middle of April. We have reviewed the consensus earnings estimates from Thomson Reuters and the stock price and trading history, as well as added some additional color on each.
Intel Corp. (NASDAQ: INTC) is scheduled to report its first-quarter results on Tuesday after the markets close. The consensus estimates call for $0.41 in earnings per share (EPS) and $12.90 billion in revenue. This chip giant does a whopping 83% of sales to foreign customers and has been hurt by the strong dollar. Weaker PC sales hurt the company as well. Hence, the earnings warning. Like many firms, Merrill Lynch analysts are seeing value in the stock after a pretty hard share pricing beat-down. They also see the other areas starting to contribute a meaningful impact to revenues and helping to move the legendary Silicon Valley chip giant away from its crushing PC dependence.
Shares closed trading at $31.93 Friday, below the consensus analyst price target of $34.61. The 52-week trading range is $25.74 to $37.90.
Advanced Micro Devices Inc. (NASDAQ: AMD) will release its most recent quarterly results Thursday. The consensus estimates are a net loss per share of $0.05 on $1.05 billion in revenue. AMD had a poor year in 2014. The stock dropped 30%, and even though it is the one of the few chip stocks in 24/7 Wall St.’s coverage universe to post a gain so far in 2015, the 1.1% increase is not exactly heart-stopping. Just a week after pumping up Intel and Broadcom, UBS analysts downgraded AMD from Neutral to Sell and set a price target of $2.40 on the shares.
In Friday’s trading session, shares ended at $2.76. The consensus price target is $3.11, and the 52-week trading range is $2.14 to $4.80.
Netflix Inc. (NASDAQ: NFLX) is set to post its first-quarter results Wednesday after the close. Consensus estimates call for EPS of $0.69 and $1.57 billion in revenue. Netflix’s core strategy is to grow its Internet streaming subscription business both domestically and internationally. As the company expands into Europe, it expects to spend heavily on international expansion over the next two years and thus projects lower operating income in 2015 than in 2014. Netflix expects to complete its international expansion by the end of 2016. The effort is focused on countries in Western Europe, Australasia and East Asia that have significant consumer broadband usage.
At the end of Friday’s trading session, shares were changing hands at $454.57. Note that the consensus price target is $452.69. The 52-week trading range is $299.50 to $489.29.
SanDisk Corp. (NASDAQ: SNDK) is scheduled to report its first-quarter results on Wednesday after the close. The consensus estimates call for $0.66 in EPS and $1.31 billion in revenue. With all the consumer electronics that are being bought and sold around the world, flash memory should be doing very well. SanDisk is the independent leader of flash memory. SanDisk announced, yet again, a revision to its guidance for the first quarter to approximately $1.30 billion, depending on final sell-through results. The company had previously guided its revenues into range of $1.40 billion to $1.45 billion.
SanDisk shares closed trading at $70.68 on Friday, below the consensus analyst price target of $81.03. The 52-week trading range is $63.00 to $108.77.
Seagate Technology PLC (NASDAQ: STX) is set to post its fiscal third-quarter results Friday. Consensus estimates call for EPS of $1.05 and $3.43 billion in revenue. This stock is still down sharply from the highs posted late last year, and some insiders sold stock in the first quarter. The company and other hard disk drive (HDD) stocks took a hit during earnings season and are just now starting to bounce back. Seagate’s sizable stock repurchase program may put some support under the stock. With 40% of the HDD market, the company may have issues in the first quarter as soft PC demand translates to lower HDD units being shipped.
Shares were changing hands at $55.58 as the week came to a close. The consensus price target is $63.39. The 52-week trading range is $48.49 to $69.40.