Earnings Season: 3 Key Quarterly Reports To Watch

Image Source: UnsplashThe Q2 earnings season continues its rapid pace next week, with many notable companies on the reporting docket. The expectation remains for another period of growth, with the Tech sector forecasted to enjoy a strong showing.Concerning next week’s docket, three notable companies – Home Depot (HD – Free Report), Walmart (WMT – Free Report), and Deere & Co. (DE – Free Report) – are all scheduled to report. Let’s take a closer look at how expectations shape up heading into the releases.

Home Depot
 Home Depot shares have been pretty volatile in 2024, up 2% overall and underperforming relative to the S&P 500. Earnings expectations for the quarter to be released have moved lower over the last several months, with the $4.59 per share estimate suggesting a 1.3% decline from the year-ago period.Image Source: Zacks Investment ResearchThe company’s comparable sales decreased 2.8% throughout the period, likely explaining the adverse reaction post-earnings. Still, HD reaffirmed its current year guidance, remaining confident that its product assortment will provide benefits.It’s also worth noting here that the company has continued to see softness in big-ticket discretionary items, a trend that’s been present for several quarters now. Many consumers purchased big-ticket items during the pandemic, reflecting pulled-forward demand.Revenue expectations have remained unchanged, with HD forecasted to post a modest 0.8% sales decline. Valuation multiples remain somewhat elevated heading into the print, with the current 22.8X forward 12-month earnings multiple above the five-year median.

Walmart
 Walmart shares have delivered a nice performance in 2024 on the back of favorable quarterly results, with the company’s profitability seeing a nice improvement. Earnings saw year-over-year growth of 22% throughout its latest period, whereas sales climbed 6%.Analysts have remained positive for the quarter to be released, with the $0.65 Zacks Consensus EPS estimate up 1.6% over the last several months and suggesting 6.5% year-over-year growth. Revenue expectations have moved similarly, with the company expected to post $168.4 billion in sales.
Image Source: Zacks Investment ResearchWalmart’s eCommerce sales have been a great story for the company, pleasing investors with its digital efforts. Global eCommerce sales throughout its latest period grew 21% year-over-year, reflecting yet again another strong quarter for the company in the metric.The metric will undoubtedly be in focus again in the upcoming print, as favorable results would again further confirm the company’s eCommerce momentum.

Deere & Co
 Deere shares have struggled in 2024, down roughly 11% and widely underperforming relative to the S&P 500. Shares have faced pressure following back-to-back releases, as we can see below.
Image Source: Zacks Investment ResearchConcerning its latest release, the company’s sales declined 12% year-over-year due to global agricultural and turf demand softening. Still, the company sees a stable construction industry, undoubtedly a major positive.Analysts have taken a bearish stance for the release, with the $5.85 per share expected down more than 15% since mid-May. 
Image Source: Zacks Investment ResearchThe CEO remains confident in the company’s standing, stating, ‘Thanks to the dedication and hard work of our team, we continue to demonstrate structurally higher performance levels across business cycles and are benefitting from stability in construction end markets amid declining agricultural and turf demand.’The stock is currently a Zacks Rank #4 (Sell) heading into the release.

Bottom Line
 We continue to wade through the critical Q2 earnings cycle, whose results overall have been positive so far.And next week, we’ll hear from several notable large-cap companies, a list that includes Home Depot, Walmart, and Deere & Co.More By This Author:Bull Of The Day: Servicenow Will Cloud Results Boost Microsoft And Amazon? Why Did Alphabet Shares Fall Post-Earnings?