Kalkine Media lists major earnings to watch from last week

Highlights:

• Eli Lilly and Company (NYSE:LLY) noted a two per cent YoY growth in its Q3 FY22 revenue.
• CVS Health noted a revenue growth of over 10 per cent YoY for the first nine months of the year.
• The diluted earnings per share of PayPal  rose 26 per cent YoY in Q3 FY22.

The earnings season is generally closely monitored by investors, especially during times of economic headwinds. It received mixed response so far, while the pressures of higher inflation and increased borrowing costs are impacting the profits of companies.

Let's revisit some major earnings from last week, which include Eli Lilly and Company (NYSE: LLY), CVS Health Corporation (NYSE: CVS), Booking Holdings Inc. (NASDAQ:BKNG), Starbucks Corporation (NASDAQ:SBUX), and PayPal Holdings, Inc. (NASDAQ: PYPL).

Given that positive earnings generally lift the sentiments of the market participants and vice-versa, the earnings season seemed to have helped gains in the market last month.

The optimism over positive earnings and hopes over a slowdown in Fed's aggressive stance to curb inflation has bolstered gains in all three benchmark US indices.

The S&P 500 and Nasdaq index noted single-digit gains last month, while the Dow Jones Industrial Average gained double-digit gains, marking its highest percentage advance since 1976.

On the other hand, the gloomy earnings from some big companies so far, which are generally not good for the market, have also lifted some investors' confidence.

Some investors see that the downbeat earnings due to the higher rates and cooling demand might ease the central bank's hawkish measures in their fight against inflation.

Last week, the Federal Reserve announced another three-quarter of a percentage point jump in the policy rates for the fourth time this year while suggesting that further increases are required to bring down the inflation under their target range of two per cent.

So, let's take a quick look at these companies' recent stock performances and see their financial performance in the latest quarter.

Eli Lilly and Company (NYSE:LLY)

The US$ 347.74 billion market cap multinational pharmaceutical firm, Eli Lilly and Company's dividend yield was 1.1 per cent. The firm's stock which primarily focuses on drug manufacturing operations, gained nearly 31 per cent YTD and 35 per cent YoY.

In the final quarter through November 4, the LLY stock added over 11 per cent and touched its 52-week high of US$ 363.9199 on the last day of October this year.

According to its Q3 FY22 earnings release on November 1, Eli Lilly and Company's revenue ticked up two per cent year-over-year to US$ 6.94 billion, and its reported EPS soared 32 per cent YoY to US$ 1.61 apiece in the quarter.

The company's US revenue was up 11 per cent YoY to US$ 4.42 billion, which was driven by a 15 per cent growth in its volume, the company said.

Meanwhile, Eli Lilly and Company expects its annual reported EPS to be between US$ 6.50 and US$ 6.65 apiece, suggesting growth of six per cent and nine per cent YoY, respectively. It also provided its annual revenue guidance between US$ 28.5 billion and US$ 29 billion.

CVS Health Corporation (NYSE:CVS)

The US$ 128.52 billion healthcare company that offers a range of healthcare solutions, CVS Health holds a dividend yield of 2.27 per cent. The healthcare firm's stock, which offers health solutions and helps people navigate the healthcare system, fell over five per cent YTD while adding about one per cent YoY.

In the running quarter, it gained over two per cent YoY and touched its 52-week low of US$ 86.28 on October 13 this year.

According to the Woonsocket, Rhode Island-based firm's earnings release of November 2, its revenue rose 10 per cent YoY to US$ 81.2 billion in Q3 FY22, and diluted loss per share totalled US$ 2.60 apiece, compared to an income of US$ 1.20 per share in Q3 FY21.

For the first nine months, CVS Health's revenue was up 10.7 per cent YoY to US$ 238.6 billion. The company had revised its annual GAAP diluted EPS outlook to be between US$ 3.12 and US$ 3.22 per share, from its prior guidance range of US$ 7.23 to US$ 7.43 per share.

Booking Holdings Inc. (NASDAQ:BKNG)

Booking Holdings is a major travel technology firm with a market cap of US$ 75.62 billion. The company's stock fell about 23 per cent YTD and around 25 per cent YoY. The BKNG stock was at its 52-week low of US$ 1,616.85 on October 13, 2022.

According to its Q3 FY22 earnings release of November 2, Booking Holdings' revenue surged 29 per cent YoY to US$ 6.1 billion, and its net income jumped 117 per cent YoY to US$ 1.7 billion.

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Starbucks Corporation (NASDAQ:SBUX)

Starbucks is a Seattle-based coffeehouse chain operator with a market cap of US$ 106.27 billion. The coffeehouses and roastery reserves firm's stock dropped by about 27 per cent YTD and 24 per cent YoY.

As per its final quarter earnings release of Thursday, November 3, the Nasdaq-listed company's revenue rose three per cent YoY or 11 per cent YoY on a 13-week basis, to US$ 8.4 billion in Q4 FY22, and its GAAP EPS was US$ 0.76 per share, compared to US$ 1.49 apiece in Q4 FY21.

PayPal Holdings, Inc. (NASDAQ:PYPL)

The leading fintech firm, PayPal Holdings' stock was down over 59 per cent YTD and about 66 per cent YoY. In the fourth quarter through November 4, it lost about 11 per cent.

The firm's revenue, which provides online payments solutions, rose 11 per cent YoY to US$ 6.84 billion, and its diluted EPS was up 26 per cent YoY to US$ 1.15 apiece in Q3 FY22.

Bottom line:

Both the economy and inflation showed resilience so far against the soaring policy rates. Despite Federal Reserve's effort to tame inflation by raising the borrowing costs, the inflation remained elevated. The economy also advanced at a 2.6 per cent rate in Q3, after two straight quarters of shrinking.

Apart from the major earnings, this week would also be crucial for the traders with several economic data scheduled to come out. The CPI data would be released on Thursday, November 10, which might set the stage for Fed's future stance on borrowing costs.

The midterm election is also scheduled this week, an important event that might also impact the equity markets significantly. So, investors should consider all the risks, and other factors, before putting their bets amid the uncertain picture in the broader market.