As the earnings season is upon us, it is essential to know which companies we should keep an eye on, especially when we are talking about some of the largest in the world by market cap.
On Thursday, investors and analysts will be holding their breaths over the following triad or the "Triple-A stocks": Apple, Amazon, and Alphabet.
Why are they important? Easy! Because they make up for almost 13% of the USA500, and their combined market capitalization is roughly $4 trillion. All three of them will report Thursday, after hours.
The company showed resilience during the pandemic, as the stock price gained more than 73% since mid-March. Although in roughly one and a half month it grew more than other companies do in half of the year, the investors are not so optimistic about forecasting the figures.
The revenue is to decline by 3.7% and reach $51.8 billion, and the EPS is to decrease 10%, while the growth rate for services is expected to be 40% lower than the peak value of min 2018.
Analysts forecast an EPS of $2.21, lower than last year’s $2.46.
In 2019, Apple had an overall return of 89.6%, more prominent than the USA500's 9.5% in one year.
Amazon was the star of the past quarter, as, during the pandemic crisis, online shopping and cloud services were in high demand. However, analysts expect the EPS to drop for the third time in four quarters, and the revenue to be healthiest in seven quarters.
Analysts expect an EPS of $1.32, a significant decrease from $5.22 in the same quarter last year. The expected revenue is to come at $81 billion, increasing from last year's $63.4 billion.
The cloud revenue is said to increase by 31.1% - the lowest in more than 16 quarters.
Since March, the stock price gained more than 80%.
In one year, Amazon had a return of 55.6%, while USA500 had a yield of 9.5%.
For this quarter, analysts expect a 4.2% drop in revenue to $37.3 billion, compared to $38.9 billion in the same quarter last year. The adjusted EPS is seen at $11.23, lower than last year's $17.25. The traffic acquisition costs are forecasted at -8.2%, indicating that the company is paying less for its traffic when the traffic might increase due to the pandemic.
In the past 12 months, Alphabet had a total return of 37.4%, compared to the USA500's gain of 9.8%.
Keep an eye on what is going on in the market, and don't forget to check CAPEX.com for more information about the earnings season!
Sources: cnbc.com, thestreet.com, investopedia.com