The Earnings Season Breakdown: Analyzing Key Companies’ Quarterly Reports

As the earnings season comes to a close, there are still several important names in the S & P 500 set to report their quarterly figures. Among them are Home Depot and Walmart, both of which are influential companies that can provide valuable insight into the health of the consumer market. Overall, 92% of the S & P 500 has already released their earnings reports, with an impressive 80% of these companies exceeding expectations, according to FactSet.

Home Depot is scheduled to report its earnings before the bell on Tuesday, with an earnings call following at 9 a.m. The home improvement giant has had a challenging year so far, reflected in its stock performance hovering around the flatline. Analysts forecast that Home Depot’s earnings for this quarter will be down more than 5% compared to the same period last year.

Despite the challenges, history shows that Home Depot has a strong track record of beating earnings estimates, with an 87% success rate according to Bespoke Investment Group. The stock has also increased in value after three out of the last four earnings releases. Investors and analysts will be closely watching Home Depot’s upcoming numbers to see if they can help boost the company’s stock performance.

Cisco Systems is set to report its earnings after the market closes on Wednesday, with a call scheduled for 4:30 p.m. Analysts are expecting double-digit declines in earnings and revenue from the legacy tech giant this quarter. Despite its challenging outlook, Cisco shares have historically risen after the last six earnings releases, as indicated by Bespoke data.

JPMorgan analysts believe that Cisco’s current valuation is “inexpensive” in the short term, but they predict a muted earnings outlook in the medium to long term. A significant portion of Cisco’s product revenues come from Campus Networking, which saw a surge in demand post-pandemic but is now in correction. This correction could be reflected in the upcoming earnings report, according to analyst Samik Chatterjee.

Walmart is slated to report its earnings in the premarket on Thursday, with a call scheduled for 8 a.m. Analysts are forecasting mid-single digit growth in both earnings and revenue for the retail giant this quarter. Walmart’s strong momentum is expected to have continued from the previous quarter, with e-commerce sales soaring.

Bank of America analyst Robert Ohmes predicts that Walmart will see continued gross margin expansion in the fiscal first quarter, driven by higher-margin profit streams such as digital advertising and fulfillment services. Despite a history of beating bottom-line forecasts 71% of the time, Walmart shares fell in two of the last three earnings days.

Investors and analysts will closely monitor the quarterly reports of Home Depot, Cisco Systems, and Walmart. These key companies provide valuable insights into consumer spending trends and the overall health of the economy. While challenges may be present, historical performance and analyst expectations offer guidance on what to expect from these key earnings reports.

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