12 portfolio companies report earnings in the week ahead. What we want to hear from each

Published Sat, Apr 27 202410:00 AM EDTUpdated Mon, Apr 29 202411:41 AM EDT

The major U.S. stock indexes closed higher for the week, with the S & P 500 and Nasdaq Composite breaking multiweek losing streaks. Earnings drove the action, despite some less-than-ideal macroeconomic reports on economic growth and inflation. Meta Platforms ' report gave the market a bit of a scare Wednesday night, contributing to Thursday's declines alongside a weaker-than-expected first-quarter GDP estimate . The action quickly and sharply reversed back to the upside Friday after blowout earnings reports from Alphabet and Microsoft . The importance of these reports cannot be overstated. They matter not only because the companies' large market values give their stocks big sway in the S & P 500 and Nasdaq, but because of what the results say about the economy overall. Cloud spending accelerated at Microsoft in the January-to-March quarter, indicating that businesses are investing in growth again and looking for ways to leverage AI into increased efficiency. If business leaders feared a recession around the corner, it's unlikely they would invest so aggressively in the new technology. Meanwhile, advertising commentary from Meta and Alphabet suggests the consumer is still spending. For instance, retail was the leading advertiser vertical for Google Search. Companies aren't going to be paying for ads if they didn't think the customer demand was there to generate a positive return on investment. The read-through from these three Big Tech reports is very positive for Nvidia , which was our top-performing stock this week, and, to a lesser extent, fellow chipmaker Broadcom . .SPX YTD mountain The S & P 500's year-to-date stock performance. Other Club reports this week included Danaher , Ford Motor , and Honeywell . Danaher and Ford delivered mostly clean reports. Honeywell was a mixed bag . In the week ahead, earnings are likely to drive the action again, though we'll get a few important macroeconomic reports. Economic data : The biggest report of the week is the April nonfarm payrolls report due out at 8:30 a.m. ET Friday. If the U.S. economy is going to hold in and avoid a recession, then consumers need to be employed with wage increases at or above the level of price inflation. In the report, economists polled by Dow Jones are looking for 250,000 payroll additions and a 3.8% unemployment rate, which would be unchanged from March. According to FactSet, economists expect a 4.1% annual increase in hourly wages, which also would be steady from March. Elsewhere, payroll processing firm ADP will release its private-sector employment report at 8:15 a.m. ET Wednesday. Wall Street expects 200,000 private payroll additions, according to Dow Jones estimates. This report takes a backseat to the government's nonfarm payrolls report, but because it comes out two days prior, it will be used as a means of gaming the Labor Department figures. Its track record has been mixed in recent years. The so-called JOLTS report — short for Job Openings and Labor Turnover Survey — is scheduled for release at 10 a.m. ET Wednesday, as well. The report provides insight on the tightness of the labor market in April. We also receive two looks at the state of manufacturing next week. The ISM Manufacturing PMI report arrives at 10 a.m. ET Wednesday, with economists expecting to see a slight contraction following a surprise move into expansionary territory in March. The U.S. government's factory orders is slated for release at 10 a.m. ET Thursday. The release of the ISM Services PMI report at 10 a.m. ET Friday will provide a look at the services sector of the economy. Earnings: We've got the biggest week of the earnings season ahead of us, with 12 Club holdings set to report. Buckle up. Here's our day-by-day preview. Tuesday Eaton helps kick it off Tuesday morning. We expect Eaton to beat the $2.29 earnings per share estimate and raise its full-year outlook due to continued strong demand for its electrical products. The conference call should be upbeat as management explains how it is benefitting from megaprojects in the U.S. and the data-center boom to support artificial intelligence-related workloads. GE Healthcare also reports on Tuesday morning. In addition to the usual revenues and earnings items, we'll be focusing on the medical technology firm's orders and backlog. Margins also will be key after management guided for 0.5 percentage points to 0.8 percentage points of expansion in 2024. Eli Lilly 's report Tuesday morning continues to be all about sales of type-2 diabetes treatment Mounjaro and weight-loss drug Zepbound. Of course, all line items are important, but for the stock to maintain its premium valuation we need to see sustained momentum for the drugs , which share an active ingredient called tirzepatide. Investors want to know whether tirzepatide remains on the path to becoming the best-selling drug of all time. The only issue Lilly may face in the interim is having enough supply to meet demand and beat Wall Street expectations. After the close Tuesday, Amazon is due out with results. Its cloud-computing unit, Amazon Web Services, will be in full focus given the strong numbers from rivals Microsoft Azure and Alphabet 's Google Cloud. We want to see AWS revenue growth accelerate from last quarter, similar to what we saw from Azure. Amazon's operating margin also will be a major watch item. The swing factor there will likely be its North American e-commerce segment, where management has been working to reduce its cost to serve and grow into excess capacity built during the pandemic. We're not expecting a good quarter from Starbucks on Tuesday night. However, we think the stock trading under $90 already accounts for this weakness. The company has not been able to solve its sluggish sales in the U.S. and China, leading us to believe a cut to guidance is in order . The offset to weak same-store sales could be margin expansion, which may help Starbucks protect its earnings growth. Wednesday Estee Lauder is a tricky one Wednesday morning. Last time around, CEO Fabrizio Freda said the company had finally reached an "inflection point," so we're looking for a return to year-over-year sales growth. The market is not sold on the company's recovery, which means a simple reiteration of full-year guidance may be enough to send the stock higher. We picked up some shares last week following a positive update from analysts at Deutsche Bank. In DuPont 's report Wednesday morning, we're looking for a continued rebound in its semiconductor business following a sequential increase last quarter. We also expect to hear management call out how it is an AI beneficiary . Less clear is the rest of the business, which has been negatively impacted by inventory destocking. However, Dupont's shelter solutions segment, which includes caulks and roof coatings, should be back on the road to steady growth by now. Over the past few months, we've also heard encouraging order commentary about Dupont's water business that should translate to sales later in the year. Essentially, we want confirmation that all end markets are starting to show improvement, with the first quarter still expected to be the low point for the year. Thursday Linde is set to report before the open Thursday. We're looking for continued earnings growth and wouldn't be surprised to see the results come in ahead of management's guidance. That's a dynamic we've seen play out consistently over the past three years. We're also interested in the breakdown of Linde's end market demand. Linde's results have the ability to provide some insight into demand across many end markets because its industrial gases are high up in the supply chain, meaning they're used to make products many steps before they reach the consumer. The most important pieces to Bausch Health 's report are not its top-and-bottom line performances. We want management's thinking on the next steps for key drug Xifaxan, which recently secured a much-needed victory from the U.S. Court of Appeals in a patent-defense case. We also seek updates on the timing of the monetization of its Bausch + Lomb stake and plans to improve its debt-heavy balance sheet. Stanley Black & Decker 's results are set to be released before Thursday's opening bell. Higher-for-longer interest rates are a headwind for the tool maker, but that's variable outside the company's influence. We want to see management demonstrate continued progress on inventory rationalization and structural cost reductions, which should result in margin expansion. Coterra Energy 's results are set to be released Thursday evening, with a conference call to be held on Friday morning. In addition to strong price realization, our focus will be Coterra's production expectations and capital expenditures, the two things management can steer; commodity prices, on the other hand, are beyond their control. Anything management offers on its decision to prioritize oil production over natural gas, given depressed prices for the latter, will also be of interest. The main event of the week is Apple 's results after the close Thursday. Demand for iPhones in China is widely expected to be weak , but the question for management will be whether there are any signs of a recovery. We will also be listening for commentary on the Vision Pro, following a report indicating that demand has started to wane for the mixed-reality headset. Is management looking into business-to-business applications? It's no secret we believe they should be given Nvidia's Omniverse compatibility. We are not holding our breath for concrete updates on Apple's generative AI strategy, despite intense investor focus; anything on this front is likely being safeguarded for the company's developer event in June. Lastly, Apple usually announces a new stock buyback authorization in this earnings report. In both 2022 and 2023, the new authorization was $90 billion. Below is a full calendar for the week ahead. Monday, April 29 Before the bell: SoFi (SOFI), ON Semiconductor (ON), Domino's Pizza (DPZ), Royal Philips (PHG), Alliance Resource Partners (ARLP), Franklin Resources (BEN) After the bell: Paramount Global (PARA), Transocean Ltd. (RIG), NXP Semiconductors N.V. (NXPI), Woodward (WWD), Arch Capital Group (ACGL), Logitech International (LOGI), Lattice Semiconductor (LSCC), Rambus (RMBS), Chegg (CHGG), F5 Networks (FFIV), Sanmina Corporation (SANM), Welltower (WELL) Tuesday, April 30 Before the bell: Eaton (ETN), GE HealthCare (GEHC), Eli Lilly (LLY), PayPal (PYPL), 3M Company (MMM), McDonalds (MCD), Enterprise Products Partners L.P. (EPD), Coca-Cola Company (KO), Melco Resorts & Entertainment Limited (MLCO), Cameco (CCJ), SiriusXM Holdings (SIRI), Oatly Group AB (OTLY), NeoGenomics (NEO), PACCAR (PCAR), American Electric Power Company (AEP), Eaton (ETN), Leidos Holdings (LDOS), Marathon Petroleum (MPC), Archer-Daniels-Midland Co. (ADM), Corning (GLW), Equitrans Midstream Corporation (ETRN), HSBC Holdings (HSBC) After the bell: Amazon (AMZN), Starbucks (SBUX), Advanced Micro Devices (AMD), Supermicro (SMCI), Riot Blockchain (RIOT), Pinterest (PINS), Caesars Entertainment (CZR), Lemonade (LMND), ONEOK (OKE), Root (ROOT), Skyworks Solutions (SWKS), Lumen Technologies (LUMN), Mondelez International (MDLZ) Wednesday, May 1 8:15 a.m. ET: ADP Employment 10:00 a.m. ET: ISM Manufacturing 10:00 a.m. ET: JOLTS Job Openings 2:00 p.m. ET: FOMC Meeting Before the bell: Estee Lauder (EL), DuPont (DD), Pfizer (PFE), CVS Health (CVS), Barrick Gold (GOLD), Mastercard Inc (MA), Norwegian Cruise Line Holdings Ltd. (NCLH), Wingstop (WING), Kraft Heinz Company (KHC), Marriott International (MAR), Ares Capital (ARCC), Generac Holdings Inc (GNRC), Johnson Controls (JCI), Cencora (COR), Cenovus Energy Inc (CVE) After the bell: Qualcomm (QCOM), Devon Energy (DVN), Paycom Software (PAYC), Carvana Co. (CVNA), Axcelis Technologies (ACLS), Fastly (FSLY), Coeur D'Alene Mines (CDE), Etsy (ETSY), Sunnova Energy International (NOVA), Albemarle (ALB), MGM Resorts International (MGM), First Solar Inc (FSLR), Marathon Oil (MRO), Allstate (ALL), Mosaic Co. (MOS), Tenable Holdings (TENB), Enovix Corporation (ENVX), Gladstone Capital (GLAD), Wolfspeed (WOLF), Zillow (Z), Avis Budget Group (CAR), DoorDash (DASH), eBay (EBAY) Thursday, May 2 8:30 a.m. ET: Initial Jobless Claims 10:00 a.m. ET: Factory Orders Before the bell: Linde (LIN), Stanley Black & Decker (SWK), Bausch Health (BHC), Novo Nordisk A/S (NVO), Canadian Natural Resources Ltd (CNQ), Peloton Interactive (PTON), Moderna (MRNA), Zoetis (ZTS), PENN Entertainment (PENN), Apache (APA), ConocoPhillips (COP), Cigna (CI), InMode Ltd. (INMD), Baxter International (BAX), Bausch Health Companies (BHC), Cardinal Health (CAH), Regeneron Pharmaceuticals (REGN), Shake Shack (SHAK), Wayfair (W), Apollo Global Management, LLC (APO), 1-800-Flowers.com (FLWS), Parker-Hannifin (PH), Aptiv (APTV), Belden (BDC), Cinemark Inc (CNK), CyberArk (CYBR), Dominion Energy (D) After the bell: Apple (AAPL), Coterra Energy (CTRA), Coinbase Global (COIN), Block (SQ), DraftKings (DKNG), Cloudflare (NET), Bill.com Holdings (BILL), Fortinet (FTNT), Amgen (AMGN), Booking Holdings (BKNG), Expedia (EXPE), United States Steel (X), BigBear.ai (BBAI), Illumina (ILMN), AXT Inc (AXTI), Five9 (FIVN), MP Materials (MP) Friday, May 3 8:30 a.m. ET: Nonfarm Payrolls 10:00 a.m. ET: ISM Services Before the bell: Cheniere Energy (LNG), Hershey Company (HSY), fuboTV (FUBO), XPO Logistics (XPO), Fluor (FLR), Cboe Global Markets (CBOE), Plains All American Pipeline, L.P. (PAA), Amneal Pharmaceuticals (AMRX), Atmus Filtration Technologies (ATMU), Brookfield Business Partners L.P. (BBU), Brookfield Renewable Corporation (BEPC), Magna International (MGA), Rapid Micro Biosystems (RPID), Interface Inc (TILE), Adient (ADNT) This story has been updated to include a preview of Stanley Black & Decker. (See here for a full list of the stocks in Jim Cramer's Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . 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