As earnings season progresses, investors should be cautious of companies that have experienced significant reductions in analyst earnings estimates. CNBC Pro has identified 10 S&P 500 companies set to report next week with the most substantial declines in average analyst earnings estimates over the past three months. These companies may struggle to meet market expectations and could face further sell-offs.
Meta Platforms, the parent company of Facebook, Instagram, and WhatsApp, reported financial results for the first quarter of 2024 that surpassed analyst expectations. Earnings per share reached $4.71, outperforming the anticipated $4.32 EPS. Revenue also exceeded estimates, reaching $36.46 billion compared to the projected $36.16 billion.
Viking Therapeutics (VKTX) reported a first-quarter loss per share of 26 cents, beating analyst estimates of 28 cents by 7.14%. The company’s research and development expenses increased significantly to $24.1 million from $11 million in the same period last year, driven by increased expenses related to drug manufacturing, pre-clinical and clinical studies, and third-party consulting services. As of March 31, 2024, Viking had cash, cash equivalents, and short-term investments of $963 million, compared to $362 million on December 31, 2023. The increase reflects proceeds from a public offering of common stock that closed on March 4, 2024. Viking’s president and CEO, Brian Lian, stated that the company reported positive results from its Phase 2 VENTURE study of subcutaneous VK2735 in obesity and encouraging data from a Phase 1 study of a tablet formulation of the compound. The company plans to discuss further development of both programs with regulators later this year.
Ford Motor Company is set to release its first-quarter financial results after the market closes on Wednesday. Analysts estimate adjusted earnings per share of 42 cents and automotive revenue of $40.10 billion. These projections represent a 2.6% increase in revenue and a 32.9% decrease in adjusted earnings per share compared to the same period last year.
Texas Instruments (TXN) delivered robust financial results for the first quarter of 2023, exceeding analysts’ expectations on both revenue and earnings per share. Revenue reached $3.66 billion, marginally above consensus estimates and reflecting a decline from the previous year and quarter. Despite the revenue dip, the company reported strong earnings of $1.20 per share, surpassing analyst estimates of $1.08 per share. This included a 10-cent benefit from non-core items. Texas Instruments highlighted the strength of its business model and the benefits of 300mm production, allowing for robust cash flow generation. Looking ahead, the company estimates second-quarter revenue to range from $3.65 billion to $3.95 billion and earnings between $1.05 and $1.25 per share. Analysts responded positively to the earnings announcement, with Mizuho and Truist Securities adjusting their price targets upwards. Mizuho maintained a Neutral rating while Truist Securities maintained a Hold rating.
Calix, Inc. (CALX) reported Q1/2024 results in line with guidance, but below analyst expectations. Revenue and profitability declined, despite solid free cash flow. The appliance business faced challenges due to customer indecision on government funding, shorter lead times, and spending plan adjustments. The company’s guidance for Q2 also fell short of consensus estimates. Analysts are expected to reduce estimates, and the stock’s valuation is seen as rich. Stimulus funding delays and ongoing headwinds pose risks to future expectations.
