Big banks delivered our first look at the post-pandemic economy last week.
But some of the most interesting news came from Pepsi (PEP).
The snack and drink giant posted stunning results.
Check out these revenue growth numbers:
FLNA = Frito Lay, QF = Quaker Foods, PB = Pepsi Bottling
That’s some impressive growth in this environment.
Yet, big banks told a different story.
Loan growth began to slow both for retail and commercial products.
Still, Delta (DAL) turned a profit in June as their outlook brightened.
Here’s what to look for in earnings this week.
Big blue tries to change
IBM reports after the bell.
While revenues declined the last decade, their recent acquisition of Red Hat delivered 18% growth last quarter.
With a massive war chest and free cash flow, investors want to hear how the company plans to drive more top line growth.
Netflix faces stiff competition
Disney+ delivered nearly as much revenue for the opening weekend of Black Widow as theaters did.
Streaming services and content seem to be popping up like daisies.
Netflix got a massive boost from the pandemic. Subscribers’ volume exploded as folks had little else to do at home.
The question is whether that can continue.
Analysts expect subscriptions slowed in Q2 as we lapped the pandemic. However, that should pick back up as the year progresses.
The real exciting news is the new video game offerings.
This could be a major growth segment that ties in nicely with their current business model.
Johnson & Johnson post-vaccine
J&J’s vaccine was plagued by production issues, not the least of which is a rare neurological side effect.
Yet, the stock trades at a 20x P/E non-GAAP, 29x P/E GAAP, making it much cheaper than the broader market.
With the stock near all-time highs, it may be one of the few that could hold its ground in the face of a selloff.
Intel changes strategies
Intel used to be top dog.
That all changed in the last decade.
Their design and production fell behind rivals like Advanced Micro Devices (AMD).
However, the shortage in semiconductors and a rock-solid balance sheet has given them a rare opportunity to realign their business.
News hit last week Intel was looking to purchase GlobalFoundries as a way to expand their production footprint.
What we’re really interested in is their insights into the global microprocessor outlook.
Our hot take
These are only a few of the companies reporting this week.
We’ll also hear from several airlines and commodity companies.
Each one gives us a different look at various parts of the economy and global supply chains.
However, don’t be surprised if the vast majority simply say they don’t know what the future holds.
Questions from your clients
- Which sectors appear over/under bought?
- Is the energy sector able to hold these price gains?
- Which sectors are poised for the most growth in the second half of the year?
- Will we see inflation start to ease?
Monday, July 19
- Earnings: IBM (IBM), JB Hunt (JBHT)
Tuesday, July 20
- 8:30 AM – Housing starts and building permits for June
- Earnings: Chipotle Mexican Grill (CMG), Halliburton (HAL), Netflix (NFLX), Philip Morris International (PM), United Airlines (UAL).
Wednesday, July 21
- Earnings: Anthem (ANTM), Coca-Cola (KO), CSX (CSX), Harley-Davidson (HOG), Johnson & Johnson (JNJ), Verizon Communications (VZ), Whirlpool (WHR).
Thursday, July 22
- 8:30 AM – Jobless claims
- 8:30 AM – Chicago fed national activity index for June
- 10:00 AM – June existing home sales
- 11:00 AM – Kansas Fed Manufacturing activity for July
- Earnings: Abbott Laboratories (ABT), American Airlines Group (AAL), AT&T (T), Biogen (BIIB), Blackstone Group (BX), D.R. Horton (DHI), Freeport-McMoRan (FCX), Intel (INTC), Southwest Airlines (LUV), Twitter (TWTR).
Friday, July 23
- 8:30 AM – Markit manufacturing & services PMI for July
- Earnings: American Express (AXP), Honeywell International (HON), Kimberly-Clark (KMB).