Earnings playbook: Your guide to trading the biggest reports of the week, including Netflix and Goldman Sachs

Published Sun, Apr 14 20247:08 AM EDT

First-quarter corporate earnings kick into high gear this week with some of the biggest U.S. banks and the leading streaming company slated to report. More than 35 S & P 500 companies are on deck to post their latest quarterly figures, including Goldman Sachs, Bank of America and Morgan Stanley. Netflix is waiting in the wings. The reporting period got off to a rough start on Friday. JPMorgan Chase posted better-than-expected results, but concerns around net interest income pressured the stock. So far, about 30 S & P 500 names have posted first-quarter numbers. Of those, 80% have exceeded expectations, FactSet data shows. Take a look at CNBC Pro's breakdown of what's expected from some of this week's key reports. All times are Eastern. Monday Goldman Sachs is set to report earnings before the bell, followed by a call at 9:30 a.m. Last quarter: GS posted fourth-quarter revenue that beat analyst expectations thanks to better-than-expected asset management results . This quarter: Analysts expect Goldman to report a slight revenue increase from the year-earlier period, according to LSEG. What CNBC is watching: Stock in the investment bank comes into its quarterly report after back-to-back weekly losses. Can Q1 figures get Goldman back on track? JMP Securities analyst Devin Ryan noted earlier this month that he prefers Goldman Sachs over rival Morgan Stanley, citing a more attractive valuation. "This view is not a negative on Morgan Stanley's business model but rather a comment that the valuation was already reflecting a more normalized return profile whereas Goldman Sachs' valuation was temporarily mispriced for an inevitable normalization," Ryan said. What history shows: Goldman Sachs beats earnings estimates 85% of the time, according to Bespoke Investment Group. However, shares have fallen on three of the past five earnings days, including one 6.4% drop. Tuesday Bank of America is set to report earnings ahead of the opening bell. A call with management is slated to take place at 8:30 a.m. Last quarter: BAC shares fell after the bank posted a decline in Q4 profit . This quarter: The Charlotte-based banking giant is forecast to report a year-over-year earnings drop of nearly 20%, according to LSEG. What CNBC is watching: Bank of America shares have struggled lately, losing 5.6% this month as investors reprice rate cut expectations. Earlier in April, UBS downgraded BofA to neutral from buy, noting that while the bank theoretically makes more money with higher rates, "concerns over the economy and its [held-to-maturity bond] portfolio may reemerge and negatively impact market multiples more." What history shows: BofA tops earnings estimates 79% of the time, according to Bespoke. The stock averages a 0.7% decline on earnings day but has posted gains after nine of the last 10 releases. UnitedHealth is set to report earnings in the premarket, followed by a conference call at 8:45 a.m. Last quarter: UNH reported better-than-expected earnings and revenue, but shares dropped more than 3%. This quarter: The health insurance giant is expected to post slight gains in earnings and revenue growth year over year, LSEG data shows. What CNBC is watching: The health insurer comes into its Q1 report needing a win. Shares are down 16% year to date as the fallout over a cyberattack and a smaller-than-expected increase to Medicare Advantage premiums pressure the Dow Jones Industrial Average member. Can the company's report spark a comeback? What history shows: Since early 2018, UnitedHealth has missed earnings expectations just twice, Bespoke data show. The stock also has a history of doing well on earnings day, rising on average 0.8%. Morgan Stanley is set to report earnings before the open. An earnings conference call at 9:30 a.m. is also scheduled. Last quarter: MS revenue beat expectations, but its CEO warned of geopolitical and economic risks ahead . This quarter: Analysts polled by LSEG expect slight earnings and revenue declines on a year-over-year basis. What CNBC is watching: Morgan Stanley took a hit last week, losing more than 6% after The Wall Street Journal reported multiple regulators were investigating how the company's wealth management division checks clients at risk of money laundering. Investors will look for updates on that, as well as how the bank will navigate the changing interest rate environment. What history shows: The Wall Street bank averages a 0.8% gain on earnings day, according to Bespoke. The company also exceeds bottom-line estimates 78% of the time. United Airlines is set to report earnings after the close. A call is slated for the following day at 10:30 a.m. Last quarter: UAL guided for a first-quarter loss due to the grounding of Boeing 737 Max 9 planes . This quarter: The airline's top line is expected to have grown by nearly 9% year over year, according to LSEG. What CNBC airlines reporter Leslie Josephs is watching: Investors will be focused on how much United will be able to grow in the coming months and years. United is one of the airlines feeling the pain from delayed deliveries from Boeing, lateness the carrier has attributed to its decision to pause pilot hiring this spring and offer aviators unpaid time off. There is also additional Federal Aviation Administration oversight of United's recent mechanical issues, including a tire that fell off of a 777 as it left San Francisco last month. United in early April said it would postpone two routes, tied to the FAA's safety review. United called off its investor day as it focuses on the FAA's safety protocol review. What history shows: United has exceeded earnings expectations for six straight quarters, Bespoke data shows. The stock has also seen strong gains in four of those instances. Thursday Netflix is set to report earnings after the close. A call with management is slated for 4:45 p.m. Last quarter: NFLX popped 10% thanks to strong subscriber additions and better-than-expected revenue . This quarter: The dominant U.S. streaming plaform is expected to report earnings growth of more than 50% from a year ago, according to LSEG. What CNBC is watching: Netflix shares have been on fire this year, surging more than 27%. Oppenheimer analyst Jason Helfstein noted the momentum can continue into Q1 earnings. He expects strong ad-supported subscriptions and said, "Paid Sharing will have a longer tail than initially believed, with only 20% of the 100M opportunity captured to-date." What history shows: Netflix beats earnings estimates 80% of the time, according to Bespoke. Shares only average a 0.1% advance on earnings day, but they posted double-digit gains after the last two reports came out. Friday Procter & Gamble is set to report earnings before the bell, followed by a call at 8:30 a.m. Last quarter: PG reported earnings that beat expectations as price hikes gave the company a boost . This quarter: The Ivory soap and Crest toothpaste maker is expected to post slight earnings and revenue growth from the year-earlier period, per LSEG. What CNBC is watching: Procter's results could be a mixed bag, according to Morgan Stanley analyst Dara Mohsenian. In an April 7 note, he said organic sales growth could be soft, but added that gross margins may be strong. "We remain [overweight] long term, with continued PG market share gains with strong execution, despite softer [organic sales growth] on near-term China beauty category weakness and decelerating developed markets category growth with decelerating pricing, as well as ahead of improving [organic sales growth] trends in FY25, as PG cycles near-term China weakness, and should benefit from reinvestment in FY24," the analyst wrote. What history shows: Bespoke data shows Procter has beaten earnings estimates in the last four quarters, notching an earnings-day gain of at least 2.6% in each instance.