This Week's Earnings Repertoire

·3 min read

Last week, the Dow powered higher despite the decline of Nike (NYSE: NKE) that missed Street's revenue expectations as even the sportswear giant hasn't been immune to supply chain disruptions. For the week, the Dow gained 0.6%, followed by S&P 500's gain of 0.5%, whereas the Nasdaq rose less than 0.1% but still ended in positive territory.

Fed Chair Jerome Powell ended the week by signaling a dovish tapering tone until the end of the year. This week, we're in for an even less crowded earnings calendar before third-quarter earnings kick in at the beginning of October.

Tuesday

Wall Street is expecting the world's leading semiconductor manufacturer Micron Technology Inc (NASDAQ: MU) to report it generated $8.22 billion in fiscal fourth-quarter revenue and deliver earnings of $2.33 per share. The stock is down 1.50% year to date, sharply underperforming both the tech sector and the S&P 500 index as it has lost 13.3% over the past six months.

Over the past few quarters, investors have been growing concerned about the demand prospects of memory chips, namely NAND and DRAM which are an integral part of smartphones, along with chips that power cloud computing, AI, and 5G, as well as the supply chain disruptions. As a result of these factors and price softness, last week, both JPMorgan and KeyBanc Capital Markets made price target cuts on the stock. On Tuesday, Microns needs to show guidance that gives confidence in the prospects of the business.

Thursday

Wall Street expects Bed Bath & Beyond (NASDAQ: BBBY) to deliver fiscal second-quarter earnings of 52 cents per share on revenue of $2.06 billion. With new leadership at the helm, the company that operates many stores in the United States, Canada, Mexico, and Australia has been showing signs of accelerating transformation. First-quarter results released in June topped Wall Street estimates as the company delivered an adjusted profit of 5 cents per share. Additionally, management raised the midpoint of the full-year revenue guidance to $8.3 billion, which is greater than the prior one by $200 million.

EBITDA guidance is $530 million with adjusted earnings midpoint being at $1.50 per share, reflecting confidence in the company's actions such as closing the worst-performing stores. Now, BBB needs to demonstrate it is capable of delivering consistent profitability as well as a detailed path towards transforming business from strictly brick-and-mortar towards the digital framework.

The United States' largest used-car retailer Carmax Inc (NYSE: KMX) is expected to report its fiscal second-quarter earnings of $1.85 per share. Investors have some high expectations as the company is operating in a historically strong selling environment, with prices and demand for its products soaring. Prices are surging, too, in part because new car prices are skyrocketing, which gives the company room to widen its margins. With its upcoming report, investors should get clarity around important issues like the supply chain, pricing, and customer traffic trends through the first few weeks of the undergoing quarter. But under any scenario, the retailer is in a favorable position as it is building enduring strengths such as a robust e-commerce network and a bigger selling footprint throughout the country, all of which should support shareholder returns, no matter what becomes of the selling environment.

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