Results for: First-Quarter Earnings

First-quarter earnings reports have surpassed expectations, with about 78% of companies reporting positive results, exceeding estimates by a significant margin of 9.5%. This exceeds the long-term average of 4.2% and the average of 7% for the previous four quarters. Major companies such as Alphabet, Meta, Netflix, Goldman Sachs, JPMorgan Chase, GE Aerospace, Caterpillar, and Microsoft have all reported notable earnings beats. Despite ongoing concerns about higher interest rates, the strong economy and job market continue to support earnings growth, with S&P 500 earnings expectations for Q2, Q3, and Q4 all trending upwards.

Wyndham Hotels & Resorts announced robust results for the three months ended March 31, 2024, highlighting continued progress in execution, openings, franchisee retention, and net room growth worldwide. The company’s global system expanded by 4%, with 1% growth in the U.S. and 8% internationally. The first quarter witnessed a 1% increase in global RevPAR, driven by a 5% decline in the U.S. and growth of 14% internationally. The company generated strong net cash provided by operating activities and adjusted free cash flow, ending the quarter with ample liquidity. Wyndham Hotels also executed $115 million of new forward starting interest rate swaps on its Term Loan B Facility, further enhancing its financial stability. The company’s Board of Directors increased the share repurchase authorization, reinforcing its commitment to returning value to shareholders. These positive results showcase Wyndham Hotels’ ongoing resilience, adaptability, and growth trajectory in the global hospitality industry.

Boeing faced scrutiny in hearings over allegations of safety failures, while the company reported a loss of $355 million in the first quarter. CEO David Calhoun acknowledged manufacturing issues and emphasized a focus on safety. Despite setbacks, Boeing remains a dominant player in the aircraft industry due to a backlog of orders and its defense contracts.

Tesla’s first-quarter financial results revealed weaker-than-anticipated earnings and a negative free cash flow, leading JPMorgan to reiterate its Underweight rating. Despite record revenue, the company’s EBIT and free cash flow fell short of expectations and analysts have revised earnings downward. Tesla’s stock performance has been under pressure, trading near its 52-week low, amid concerns over earnings and cash flow. However, InvestingPro insights indicate that Tesla remains a key player in the automotive industry with a positive balance sheet and strong long-term growth potential.

Biogen reported a solid first quarter with its profits exceeding estimates. The company’s highly anticipated Alzheimer’s drug, Leqembi, has generated significant sales of about $19 million, surpassing the $14 million analysts had predicted. Leqembi, which is administered through intravenous infusions, has experienced a steady increase in patients, with the total number on the drug rising to nearly 2.5 times what it was at the end of 2023. The drug’s annual price tag is $26,500 per patient, and Medicare has agreed to cover the cost for those who meet specific criteria. Additionally, Biogen has implemented cost-cutting measures, including eliminating over 1,000 jobs since Viehbacher became CEO in late 2022.

Amidst ongoing market fluctuations and speculation about Elon Musk’s dual roles as CEO of Tesla and Twitter, the tech magnate has reaffirmed his primary focus on Tesla. During the company’s first-quarter earnings call, Musk emphasized that Tesla occupies the majority of his work time and expressed confidence in its continued prosperity. However, his comments came after a recent stock downturn following reports of disappointing deliveries and concerns about his potential reduced involvement with Tesla in the future.

Swedish automaker Volvo Cars has reported an 8% increase in core operating profits for the first quarter of 2024, attributed to strong retail sales. Despite a slight dip in revenue, retail sales surged by 12%, reaching a record high in March. The company’s strong performance in the first quarter sets a positive foundation for the upcoming year.

The Hang Seng Index opened with a 1.1% increase to 17,018.98 as of 9.51am local time, while the Hang Seng Tech Index gained 1.8%. Ping An Insurance experienced a 1.5% surge to HK$33.50 due to exceeding estimates in new-business values during the first quarter. Hong Kong Exchanges and Clearings rose 1.2% to HK$233.40 ahead of its earnings report later on Wednesday.

Tesla’s first-quarter net income saw a significant decline of 55%, but the company’s stock witnessed a surge in after-hours trading on Tuesday. This was attributed to the announcement of accelerated production of new, more affordable vehicles. In a letter to investors, the company outlined its plans to start production of smaller and more cost-effective models ahead of previous estimates. These vehicles will utilize innovative vehicle underpinnings and incorporate features from current models. Tesla emphasizes that the manufacturing will occur on the same production lines as its existing products, minimizing the need for hefty capital expenditures. While CEO Elon Musk provided limited details about the new vehicles, he anticipates the commencement of production between late this year and the second half of next year. Despite the positive market response, shares of Tesla remain down by over 40% for the year.

On CNBC’s ‘Halftime Report Final Trades,’ analysts provided their final trade recommendations.

Stephen Weiss of Short Hills Capital Partners highlighted Taiwan Semiconductor Manufacturing Company Limited (TSM) as oversold and undervalued, citing its recent earnings beat. TSM’s revenue and net income exceeded expectations in the first quarter.

Jenny Van Leeuwen Harrington of Gilman Hill Asset Management, LLC recommended SL Green Realty Corp. (SLG) for its 6% yield. While SLG missed revenue expectations, it beat estimates on FFO.

Joseph M. Terranova of Virtus Investment Partners named Goldman Sachs Group, Inc. (GS) as his final trade. GS reported better-than-expected earnings, beating estimates on both revenue and EPS.

All three stocks experienced price gains on Monday’s trading session: TSM rose 1.6%, SLG gained 2.4%, and GS jumped 3.3%.