3 Stocks To Watch This Week: Alphabet, Amazon, Intel
Haris Anwar | Jul 24, 2022 21:25
- More than a third of S&P 500 companies are reporting earnings next week.
-
Alphabet sales may get a hit from the possible spending cut on digital ads and Russian war.
-
Amazon’s e-commerce business is facing a sharp slowdown as people shift their spending pattern after the pandemic.
- Inflation
- Geopolitical turmoil
- Disruptive technologies
- Interest rate hikes
Earnings releases from some of the largest US companies may help provide direction for investors this week who are looking for signs of weakness in consumer demand amid a threat of recession.
More than a third of S&P 500 companies are reporting, including tech and industrial giants that have global footprints and have the latest update on how inflationary pressures and war in Europe are impacting consumer behavior.
In addition to major earnings announcements, the US Federal Reserve will also announce its decision on interest rates this week amid expectations that a 75 basis point jump is a done deal. The Fed has been pursuing the most aggressive monetary tightening in decades to cool down the economy and tame a four-decade high rate of inflation.
Below, we've short-listed three stocks from different sectors we’re monitoring as Q2 earnings season ramps into full swing:
h2 1. Alphabet/h2Alphabet (NASDAQ:GOOGL) (NASDAQ:GOOG), the parent company of Google, will be reporting second-quarter 2022 earnings on Tuesday, July 26, after the market close. On average, expectations are for earnings per share of $1.28 on revenue of $70.04 billion.
Google’s Q2 results are likely to be impacted by the Russian war in Ukraine, a worsening macro environment in which companies are cutting their ad spending, tougher comparisons against pandemic highs and changing foreign exchange rates.
Alphabet Earnings History
Ahead of the earnings announcement, some equity analysts have lowered estimates for YouTube sales in part to reflect the heightened competition from ByteDance Ltd.’s TikTok video app.
Google is also facing a tougher regulatory environment in Europe. Google’s second-largest business line, its network system that runs ads elsewhere on the web, was likely limited by new regulations in Europe that restricted ad targeting.
Google stock, which has lost more than 25% this year, closed at $107.90 on Friday.
h2 2. Amazon.com/h2Online retail juggernaut Amazon (NASDAQ:AMZN) will report Q2 earnings after the market closes on Thursday, July 28. The consensus is that the world’s largest e-commerce company will report $119.18 billion in sales, producing per share profit of $0.1279.
Get The App
Amazon’s business is facing a sharp slowdown after the pandemic-induced boom as people shift their spending to activities, such as travel and eating out.
The Seattle-based behemoth reported sales that rose just 7% during the first quarter of 2022, compared to the 44% expansion during the year-ago period. It marked the slowest growth rate for any quarter since the dot-com bust in 2001 and the second straight period of single-digit growth.
Source: InvestingPro+
This slowdown will likely continue for the remainder of the year as both consumers and companies face rising interest rates, and a rate of inflation that is the highest in four decades.
Amazon stock, which closed on Friday at $122.42, has weakened more than 25% this year.
h2 3. Intel/h2Chipmaker Intel (NASDAQ:INTC) is yet another tech heavyweight set to release earnings during the upcoming week. The Santa Clara, California-based company will report its latest quarterly earnings on Thursday after the close.
The semiconductor giant is forecast to report $0.6967 a share profit on revenue of $17.96 billion, according to analyst consensus, amid reports that demand for chips in some industries is slowing.
Source: Investing.com
While chips used in cars and data centers are still in high demand, prices of memory chips used in many electronic gadgets have fallen in recent months, prompting some producers to get ready for tougher days ahead.
Intel has lagged in introducing newer and faster products and has lost some of its biggest customers, such as Apple, which has decided to manufacture its own chips. Intel shares, which closed at $39.20 on Friday, have weakened about 25% this year.
Disclosure: The writer owns shares of Amazon.com
***
The current market makes it harder than ever to make the right decisions. Think about the challenges:
To handle them, you need good data, effective tools to sort through the data, and insights into what it all means. You need to take emotion out of investing and focus on the fundamentals.
For that, there’s InvestingPro+, with all the professional data and tools you need to make better investing decisions. Learn More »
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.