Earnings Weekly: Earnings Parade Slows
- By John Tierney
- 4 min read
Summary
- Only seven S&P 500 companies report earnings this week, and 24 across June. Whatever drives markets in this period, it will not be earnings.
- Still, expect some drama. 488 companies have reported 2Q earnings; half those remaining are in the consumer staples sector.
- They should indicate how consumers are responding to food inflation, and how their business models will likely fare in coming months.
This article is only available to Macro Hive subscribers. Sign-up to receive world-class macro analysis with a daily curated newsletter, podcast, original content from award-winning researchers, cross market strategy, equity insights, trade ideas, crypto flow frameworks, academic paper summaries, explanation and analysis of market-moving events, community investor chat room, and more.
Summary
- Only seven S&P 500 companies report earnings this week, and 24 across June. Whatever drives markets in this period, it will not be earnings.
- Still, expect some drama. 488 companies have reported 2Q earnings; half those remaining are in the consumer staples sector.
- They should indicate how consumers are responding to food inflation, and how their business models will likely fare in coming months.
Monday
- Today is tech day.
- Salesforce will provide an update on corporate demand for software. Software companies have generally done well in the past earnings season as companies turn to automation to offset labour shortages.
- Hewlett Packard (HPQ), maker of printers, computers and related hardware, has benefited from the work-from-home trend. With more people returning to the office, how is demand shaping up? And are semiconductor chip shortages causing problems?
Tuesday
- The more corporate-oriented Hewlett Packard Enterprise (HPE) and NetApp (NTAP) should indicate how companies are investing in data management and cloud services.
- It has been a rough earnings season for many consumer discretionary companies, but luxury/niche companies have managed to buck the trend. PVH Corp (PVH) will be the latest data point.
Wednesday
- Hormel Food Corp (HRL), producer of branded food products, sits squarely between rising food commodity energy costs and consumers who need to eat but want to stretch their food dollars as far as possible. Markets will surely react to its outlook.
- Cooper Co. (COO) manufactures various health-related products for consumers and health professionals. Demand should be no problem, but can it meet that demand?
The Month Ahead
- In coming weeks, we will hear from several consumer staples companies, including JM Smucker Co (SJM), Campbell Soup (CPB) and Kroger Co (KR).
- Royal Caribbean Cruises (RCL) gave an upbeat outlook about cruise vacation demand – but that was as of the end of March. Will Carnival Corp (CCL), reporting a month later, echo that optimism?
