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Summary
- Tech behemoths Microsoft, Apple, AMD, Facebook, and Tesla will report their earnings by this week.
- These tech stocks have posted remarkable gains in recent quarters, buoyed by homebody economy.
- Nasdaq rallied 14 per cent by Monday midday, as traders bet on big techs’ bigger earnings in the current quarter.
Wall Street and Bay Street are pumped-up in anticipation as major tech powerhouses like Microsoft, Apple, AMD, Facebook, and Tesla are due to present their earnings reports this week.
The 2020 earnings season had been a disastrous year for some, laden with uncertainties and pitfalls due to the COVID-19 pandemic. But for others, it was a roller-coaster ride.
These technology behemoths have reported remarkable growth in all three consecutive quarters of the fiscal year, raising the stakes for even better performance in the current quarter.
Nasdaq rallied by almost 14 per cent to 13556.74 at 11:54 am ET on Monday while Nasdaq 100 was up nearly 0.3 per cent to 13405.05. Markets analysts have opined that tech stocks may continue to rally throughout the week.
What to Watch:
Microsoft Inc. (NASDAQ:MSFT)
Microsoft plans to release the report on Tuesday, January 26, after the market closes. Microsoft stocks were priced at $228.1 per share on January 25, 2021. In year-to-date terms, its share price value rose by more than 21 percent. Its current market cap is more than $1.7 trillion.
In 2019, it had made a gross profit of nearly $97 million. Its P/E ratio is 36.50.
The work-from-home trends during the pandemic have boosted its sales, especially demand for its cloud computing systems. Going forward, the company’s successful cloud business, Azure, as well as Microsoft Teams will continue to be a driving force for the stock’s strong performance.
Apple Inc. (NASDAQ:AAPL)
Apple plans to release the report on Wednesday, January 27. Apple stocks were priced at around $143 on January 25, 2021. Its stock value rose by over 9 percent year-to-date.
Its P/E ratio was 35.10. Its current market cap is over $2.5 trillion.
Apple’s iPhone 12 sales figures are expected to be a key component of the overall earnings.
The iPhone 12 series have undergone several upgrades, including the LIDAR sensor provided with the Pro models, besides 5G capabilities. Analysts described the changes as “revolutionary”.
Besides iPhone sales, income from its services business had surged to a record $14.5 billion in the previous quarter.
@Kalkine Image 2021
Advanced Micro Devices Inc. (NASDAQ:AMD)
AMD also plans to release the report on Tuesday, January 26, after the markets close.
AMD stocks were priced at around $94 on January 25, 2021. Its stock value rose by 2 percent year-to-date. Its P/E ratio is 125.40 and a market cap of $11.5 billion.
In 2019, it made a gross profit of $2.8 million.
Boosted by the strong performance of its data-center business and PC sales, the company is expected to present a positive earnings report.
Despite the pandemic, the company’s business remained in high gear. AMD shares have been on the rise, climbing about 5% over the past week, and is now up 1.2% year to date.
Factors contributing to its stocks’ popularity included positive earnings report for the last six consecutive quarters, robust top-line and bottom-line growth, among others.
Facebook Inc. (NASDAQ:FB)
The social media giant will present its report on Wednesday, January 27, after the market closes. Facebook shares were priced at around $276 on January 25, 2021. Its stock value remained flat year-to-date. Its current market cap is more than $789 billion. Its P/E ratio is 31.30.
In 2019, it earned a gross annual profit of nearly $58 million.
Facebook shares have had an impressive run over the past week, rising by 12 percent.
The company has been performing well over the past eleven quarters.
However, risks posed by various political factors remained, which may hinder its growth and eventual profitability. In the recent past, Facebook had been criticized over its privacy policy. But it also has immense opportunities to boost its user base, with an unassailable lead in the market.
Tesla Inc. (NASDAQ:TSLA)
This pioneering electric car company will present the report on Wednesday, January 27. Tesla’s stock value continues to rise with a robust top-line and bottom-line growth over the past year. Its stock is trading around $882 and continues to rise. Its value rose more than 20 percent year-to-date.
Its gross annual profit in 2019 was around $4 billion.
Its P/E ratio is 1.653, and a market cap of around $83 billion.
In 2020, the company delivered 499,550 vehicles, and there is no sign of slowing down.
After debuting with Tesla Roadster in 2008, it came out with four more models. The latest Model Y came out in 2020.
In 2019, it had delivered 367,656 EV units globally.
