Stock Market Futures Gain As More Positive Earnings Roll In
U.S. stock futures are on the rise following yesterday’s mixed session. The tech-heavy Nasdaq, in particular, is seeing somewhat of a recovery rally following its notable 1.22% drop during the previous session. Overall, it appears that the stock market remains volatile as investors continue to digest the current batch of earnings. Even with positive earnings, broad-based headwinds continue to plague companies across the board. This could, arguably, weigh in on outlooks for the short-to-mid-term.
Providing an overview of all this is Deepak Puri, Deutsche Bank’s (NYSE: DB) wealth management chief investment officer. Puri starts by saying, “The big question is whether the earnings can really sustain this kind of a macro backdrop of slower growth and [tighter] Fed policy.” He continues, “It seems certain companies can — historically that’s been the case. What’s different this time is really the trifecta, which is higher costs of capital, quantitative tightening, plus a lack of … a big fiscal stimulus.”
While this may seem daunting, Bank of America (NYSE: BAC) CEO Brian Moynihan did recently note that consumer spending remains strong. In his words, “They are a very strong force and you can see them very healthy. Their loan balances are down, they have plenty of borrowing capacity and they have plenty of spending capacity.” As investors look to make sense of all this, there remains plenty of stock market earnings news to consider today. As of 5:25 a.m. ET, the Dow, S&P 500, and Nasdaq futures are trading higher by 0.58%, 0.77%, and 1.14% respectively.
Tesla Rallies Following Stellar First-Quarter Earnings Report
Tesla (NASDAQ: TSLA) is among the top head turners in the stock market today. Notably, this is thanks to the company revealing its latest quarterly financials. In it, Tesla seems to be seeing green across the board. For starters, the company is looking at an earnings per share of $3.22. For reference, this handily beats Wall Street estimates of $2.26. Moreover, the electric vehicle (EV) titan raked in a total revenue of $18.76 billion for the quarter, also above consensus forecasts of $17.8 billion.
Going into the specifics, Tesla’s strong momentum on the automotive sales front is likely to thank for this stellar performance. For the quarter, the company’s automotive revenue is $16.86 billion. This translates to a whopping 87% year-over-year increase. According to Tesla, its automotive gross margins soared to 32.9%. By and large, all of this comes as no surprise seeing as Tesla continues bolstering its manufacturing capacities worldwide. In fact, just earlier this month, the company posted its second consecutive quarter with record deliveries. For a sense of scale, Tesla’s quarterly deliveries for Q1 2022 are currently at 310,048 units.
Sure, CEO Elon Musk may be making headlines for his current bid to take over Twitter (NYSE: TWTR). But Tesla does not seem to be slowing down in the least bit. Over the past month, the company celebrated the opening of two new mega factories. These would be its Giga Berlin and Giga Texas facilities. Despite inflationary and supply chain pressures, Tesla is working hard to localize production, optimize its operations, and speed up distribution. As a result of all this, I could see TSLA stock making headlines in the stock market today.
United Airlines Expects 2022 Return To Profit As Flight Ticket Prices Soar
At the same time, United Airlines (NASDAQ: UAL) seems to be taking off amongst its airline industry peers today. For the most part, this comes after United provided an upbeat outlook for the current fiscal year. Before going into that, a quick look at the company’s financials for the quarter. United posted a quarterly loss of $4.24 per share, below consensus forecasts of a $4.22 loss. Additionally, United’s total revenue for the quarter is currently at $7.57 billion. This too is just shy of analyst estimates of $7.68 billion.
Despite the seemingly lackluster results, United’s recovery from its pandemic era should not be overlooked. The company’s total revenue is up by over 135% year-over-year. More importantly, United is currently expecting to turn a profit in 2022. The company cites immense momentum across business travel and leisure bookings. In the words of CEO Scott Kirby, “I’ve never seen in my career, and I’ve been in this industry a long time … such a hockey stick increase of demand.” For the current quarter, United is guiding for a 10% operating margin and its highest quarterly sales to date. As such, it is no wonder that UAL stock is taking the lead among the top airline stocks now.
Procter & Gamble Beat Earnings Forecasts; Hikes Prices To Combat Inflation
In other earnings-related news, Procter & Gamble (NYSE: PG) is also in focus after posting commendable quarterly results. Diving in, the company saw earnings of $1.33 per share on revenue of $19.38 billion. To put things into perspective, consensus analyst expectations stand at $1.29 and $18.73 billion respectively. While PG’s margins continue to feel the pinch from rising commodity and freight costs, the company is adapting accordingly. It is doing so via a combination of product price hikes and productivity savings.
On the operational side of things, PG is also seeing consistent growth across its core product segments. Firstly, both its fabric & home-care and baby, feminine & family-care divisions saw organic sales growth (OSG) of 10%. In particular, its Tide brand detergent is looking at a double-digit increase in sales. Secondly, the company’s grooming segment, covering its Gillette razors, saw OSG of 8%. Thirdly, PG’s beauty division is also up by 3% in this respect.
Looking forward, PG also seems to be confident regarding its ability to navigate these challenging times. Namely, the company is raising its revenue growth forecast to a range of 4% to 5%. This would mark a notable increase from its previous outlook of a 3% to 4% increase. Seeing as PG continues to power forward, PG stock could be in focus at today’s stock market open.
Notable Stock Market Earnings To Consider Today
Not forgetting, there are also plenty of other earnings on tap today. The likes of which range from more airline firms to cyclical, energy industry, and even tech names. In the pre-market, we have American Airlines (NASDAQ: AAL), AT&T (NYSE: T), Nucor (NYSE: NUE), Freeport McMoRan (NYSE: FCX), and NextEra Energy (NYSE: NEE).
Alternatively, things are leaning more towards the tech side after today’s closing bell. This is apparent as Snap (NYSE: SNAP) and Qualtrics (NASDAQ: XM) take center stage. Aside from that, Intuitive Surgical (NASDAQ: ISRG), PPG Industries (NYSE: PPG), and Boston Beer (NYSE: SAM) are also hosting their earnings calls. All in all, it seems like investors have another jam-packed day of earnings to look ahead to.