Wednesday morning\u2019s earnings reports mark the halfway point in this busiest week of earnings season. Next week\u2019s report count will be lower due to the President\u2019s Day holiday.<\/p>\n
This edition of our earnings previews focuses on four companies set to report December quarter results before Wednesday\u2019s opening bell.<\/p>\n
iRobot Corp. (NASDAQ: IRBT) is the maker of Roomba robot floor vacuum cleaners, Braava floor mopping robots and Terra robotic lawn mowers, among other things. Like many other consumer discretionary stocks, iRobot had a good 2020, with a share price increase of nearly 60%.<\/p>\n
Then things got really crazy as shares doubled when retail investors drove prices higher, squeezing short sellers who held more than 38% of the company\u2019s shares. The share price doubled by January 27 and has since fallen back to a gain of around 53% for the first six weeks or so of 2021.<\/p>\n
Analysts expect the company to report fourth-quarter earnings per share of $0.31, less than half EPS in the year-ago quarter, and revenue of $494 million, up 16% year over year. For the full year, analysts are looking for EPS of $3.63, up 22%, on revenue of $1.4 billion, up nearly 14%.<\/p>\n
At a current price of around $123, iRobot stock has outrun its consensus price target of $101.50 and its high target of $120. The 52-week high of $197.40 suggests a potential upside of 60%. Shares trade at around 34 times expected 2020 EPS and 56 times expected 2022 earnings.<\/p>\n
MGM Resorts International (NYSE: MGM) on Monday received an upgrade from BofA Securities from Underperform to Neutral that boosted the share price by around 15% in just one day. That\u2019s more good news for the hotel and casino operator that saw its share price plunge by nearly 80% in late March of last year, the deepest trench of the COVID-19 pandemic.<\/p>\n
A late March Federal Reserve decision to purchase commercial mortgage-backed securities lifted MGM stock (and others), and by the end of December, MGM shares were down less than 5% for the year.<\/p>\n
Consensus estimates for the fourth quarter call for a net loss of $0.92 per share on revenue of $1.5 billion, down more than 50% from revenue in the fourth quarter of 2019. For the full year, MGM\u2019s net loss is tabbed at $3.82 per share on sales of $5.2 billion, a revenue drop of some 60% year over year. The stock is also forecast to post a net loss of $1.71 per share in 2021 before recovering to post EPS of $0.22 in 2022. At the current share price of around $35.75, MGM stock trades at nearly 327 times expected 2022 earnings.<\/p>\n
Since the beginning of the year, analysts have shown some love for Uber Technologies Inc. (NYSE: UBER). Of nine ratings since January 4, all have maintained the equivalent of a Buy rating on the stock and all have boosted their price targets.<\/p>\n
The ride-sharing firm succeeded in recovering from a sharp drop at the peak of the pandemic lockdowns by swerving into the delivery business. In the third quarter of last year, ride-sharing revenue declined 53% while delivery revenue jumped by 125%, holding the corporate shortfall in revenue to 18%.<\/p>\n
Analysts expect Uber to report a fourth-quarter net loss per share of $0.55 on revenue of $3.6 billion. The year over year loss is smaller, but revenue is also forecast to be down. For the full year, the consensus estimate calls for a loss per share of $3.87 on sales of $12.3 billion. The net loss reflects a sharp decrease for the year-ago loss of $6.81. With losses forecast for both 2020 and 2021, the stock trades at about 88 times expected EPS of $0.37 in 2022.<\/p>\n
Video game maker Zynga Inc. (NASDAQ: ZNGA) posted a share price gain of more than 60% in 2020, largely due to people around the world being subjected to lockdowns and turning to their computers and mobile devices for entertainment.<\/p>\n
Zynga depends on ad tracking for both revenue and recruiting new users, so the coming privacy feature for Apple\u2019s iPhone and iPad operating systems could have a negative effect on Zynga\u2019s revenues going forward. The company also spent nearly $2 billion on acquisitions last year, leaving analysts upbeat about the outlook for this year.<\/p>\n
The consensus estimate calls for EPS of $0.09 in the fourth quarter and $0.37 for the full year, up more than 40% over 2019. Quarterly revenue is set to rise by 56% to $677.7 million and full-year revenue is tabbed to rise nearly 44% to $2.25 billion.<\/p>\n
At a current price of around $11.50 per share, the stock trades at a multiple of about 31 times expected 2020 EPS and 27 times expected 2021 EPS. The stock posted a new 52-week high of $11.49 earlier Tuesday morning. The 52-week low is $5.65 and the consensus price target is $11.91.<\/p>\n<\/p>\n