Wall Street is gearing up for a busy week ahead with over 160 companies in the S & P 500 set to report their latest earnings. This represents nearly one-third of the benchmark’s constituents, with six of them also being part of the Dow Jones Industrial Average. The first quarter earnings season is reaching its midway point, and so far, the profits have been positive. According to FactSet, as of Friday, 77% of companies that have reported surpassed analyst estimates for their quarterly earnings, with 60% of them also beating expectations.
Stocks to Watch
Upon closer examination, it is evident that the stocks that are expected to perform well post-earnings have certain specific criteria that they need to meet. These include a consensus earnings per share estimates increase of at least 10% in the past three and six months, buy ratings from at least 55% of analysts, and a price target suggesting at least a 10% upside from current levels. Some of the names to watch in the upcoming earnings reports include Amazon, Mastercard, and Equinix.
Amazon
Analysts have significantly boosted Amazon’s three- and six-month earnings estimates by 139% and 309%, respectively. The consensus price targets indicate a potential upside of 31% for the e-commerce giant, which has seen its shares rise by 18% this year. With the owner of Amazon Web Services (AWS) set to report first-quarter earnings, there is optimism in the market. Both UBS and Citi have reiterated their buy ratings on Amazon and raised their 12-month price targets. Citi analyst Ronald Josey views Amazon as one of his top picks in the Internet sector, with a price target implying another 31% increase in share price.
Mastercard is another stock to keep an eye on as it has seen its earnings estimates rise by 12% in the past three months and 20% over the past six months. The average analyst price targets suggest an 18% rally for the credit card company, which has seen its shares climb 8% higher this year. With TD Cowen initiating coverage of Mastercard at a buy rating and setting a price target indicating an 18% increase, there is optimism surrounding the company’s upcoming earnings report.
Equinix, a data center company, also shows promise with analysts increasing its earnings estimates by 29% over the past three and six months. Despite the fact that shares of Equinix have fallen by 9% this year, experts believe that there is an 11% rally potential from current levels. This indicates that Equinix could surprise investors with its upcoming earnings report.
The upcoming earnings reports on Wall Street present an opportunity for investors to assess the performance and potential of various companies. By analyzing the criteria for stocks that might see a post-earnings rise in valuation, investors can make informed decisions about where to put their money. Stocks like Amazon, Mastercard, and Equinix are worth watching as they have the potential to deliver positive results and drive their share prices higher in the coming days.
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