December 7, 2022

Earning Relationships from Familiar Names – Part 2


With Monday’s income reports ruled out, it is now time to turn our attention to the reports due Tuesday. Interestingly, half of FAANG is publishing earnings reports today. For this reason, expect hyperactive NASDAQ in Tuesday’s session.

Let’s start with Apple Inc (NASDAQ: AAPL) and Microsoft (NASDAQ: MSFT)

The two largest companies in the United States, APPL and MSFT, report back to back on Tuesday.

The market analyst sitting to my left, Pavan Sharma, from the equity research arm of BlackBull Markets (check them out for some nifty stock picks), shared with me the following interesting chart from 2020 that demonstrates the hugeness of Apple.

This graph asks the question; How many Air pods did Apple sell in Q3 2021 and how much does this device contribute to the company’s revenue in Q3?

Apple’s revenue is expected to be US $ 73 billion, up over US $ 10 billion from PCP. Pneumatic pods could account for a smaller portion of the company’s third-quarter revenue depending on the quality of iPhone 12 sales in the quarter and whether Apple has experienced any supply constraints for pneumatic pods.

When it comes to Microsoft, investors will want to see if it has maintained its cloud service revenue growth. The cloud is now the software company’s biggest revenue stream and is expected to add up to over US $ 14 billion of the $ 44 billion expected revenue for the quarter. Microsoft’s past success in cloud computing could be its downfall this quarter. Maintaining 25% year-over-year growth in its cloud division is a big demand.

By the way, the first tech pick of BlackBull Markets research arm is Apple for several reasons. The main reason being its strong brand presence and its ability to generate healthy margins on its wide variety of products and services with strong growth potential also anticipated on new products and services – in particular the digital services complementary to its core business. job. Apple also has a strong balance sheet with around $ 196 billion in cash, which can be deployed to reinvest in new offerings or acquisitions, and on traditional valuation metrics, its price is more attractive than its mega-cap peers with a solid history of paying a growing dividend.

The APPL and MFT earnings reports will be deleted after the closing bell on Tuesday.

Mattel (NASDAQ: MAT) may surprise

Because I covered Hasbro (NASDAQ: HAS) yesterday, I want to cover Mattel, another big toy maker, today.


Mattel has a habit of making pessimistic projections, whether it’s understating their projected profits or overselling their projected losses. Because of this, the company’s actual earnings per share are likely to surprise the market when Mattel releases its earnings report after trading ends on Tuesday.

Mattel’s profits for its second-quarter operation are expected to be just over $ 900 million, up 23% from PCP as it faced Covid-related shutdowns of many of its business partners.

Other earnings reports to watch for Tuesday

  • General Electric (NYSE: GE).

  • Alphabet (NASDAQ: GOOG).


  • Starbucks (NASDAQ: SBUX).

  • Visa (NYSE: V).

  • Mondelez International (NASDAQ: MDLZ).