(Bloomberg) — Equity investors are assessing the impact of global rate hikes before market attention shifts back to corporate earnings. Guidance boosts from this week by companies including Kroger, Tapestry, DocuSign and Gitlab suggest that strong demand may help firms in a variety of sectors weather macro headwinds and deliver better-than-expected results for the full year.
(Bloomberg) — Equity investors are assessing the impact of global rate hikes before market attention shifts back to corporate earnings.
Guidance boosts from this week by companies including Kroger, Tapestry, DocuSign and Gitlab suggest that strong demand may help firms in a variety of sectors weather macro headwinds and deliver better-than-expected results for the full year.
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Earnings highlights to look for next week:
Monday: Oracle (ORCL US) reports postmarket.
Following mixed guidance from peers Microsoft and Salesforce over the summer, investors will be looking to see how well the software marker’s cloud migration plans have held up against the slowing macro environment.
Worse-than-anticipated foreign exchange headwinds during the fiscal first quarter could drive the reported results to levels below the Street’s expectations, analysts at Guggeheim Securities wrote. That said, thanks to its recent acquisition of digital medical records provider Cerner, the company’s top line on a constancy-currency basis may grow at the fastest pace in over a decade, according to Bloomberg consensus.
On the earnings call later that day, investors will be listening for the company’s plan to improve the margin structure. After Oracle slashed jobs last month in a unit where results lagged expectations, management is expected to also cut back on new hirings in the coming year or undertake another restructuring, said Bloomberg Intelligence.
Tuesday: No major earnings scheduled.
Wednesday: Li-Cycle (LICY US) will announce third-quarter results premarket. The Canadian battery recycler has had its revenue estimates trimmed by analysts since it last reported, with Cowen attributing the revision to lower cobalt and nickel pricing, which in turn impacts black mass: the powder substance used to create new batteries that’s produced during the recycling process.
Having returned to a loss last quarter, investors may focus on the company’s cost and cash burn forecast as it prioritizes building more plants in North America and beyond.
- ESG in Focus: Investors may also watch for big-picture commentary from the company on market outlook, as analysts see a favorable global regulatory environment for Li-Cycle in the long term.
Cowen analysts rate the stock “outperform”, and said that the company is positioned to benefit from a proposed US tax credit for the use of recycled batteries in electric vehicles. A mandate by European regulators forcing automakers to use more recycled materials in batteries starting in 2030 also bodes well for the company, BI Senior ESG Analyst Gail Glazerman noted.
Some recyclers are concerned, however, about whether there is even enough waste material for them to process, risking the introduction of using freshly mined material in plants.
Thursday: Adobe (ADBE US) is due after the market close.
According to Bloomberg consensus, analysts see both top and bottom lines for the fiscal third quarter to be in line with company guidance of $4.43 billion and $3.33, respectively. Pricing changes could offset seasonal slowness among enterprises, giving the company’s key Digital Media net new annualized revenue metric a lift, or even a beat, Barclays analysts wrote.
Still, disappointing sales guidance from peer Salesforce may cast doubts over Adobe’s ability to steer clear of macro headwinds going forward. Finally, foreign exchange impact — which in part forced the California-based company to trim its full-year outlook in June — continues to worsen, said Jefferies analysts.
Friday: No major earnings scheduled.
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