Stocks to Watch: Investor Jobs Report, OPEC Meeting and EV Reports
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Investors are hoping March will end like a lamb after a turbulent few weeks amid the backlash from the Russia-Ukraine war and anxiety over rising interest rates. In the rough macro background. OPEC+ will hold a virtual meeting where the group is expected to keep current production plans in place even with crude oil prices trading at a 14-year high and the International Energy Agency warning of the impact of the loss of Russian oil. On the economic calendar, the US jobs report for March will be released, with economists predicting a gain of 450,000 jobs to follow after an explosion of 678,000 last month. The unemployment rate is expected to fall to 3.7%. The average hourly wage is expected to rise 0.4% month-over-month and 5.4% year-over-year. Earnings reports are light in the week ahead, but a flurry of Tesla delivery reports (NASDAQ: TSLA), Nio (NYSE: NIO), Li Auto (NASDAQ: LI) and XPeng (NYSE: XPEV) could put a charge in the vast electric vehicle sector when the calendar shifts to April on Friday.
Earnings Spotlight: Monday, March 28 XPeng (XPEV), Dave & Buster’s Entertainment (NASDAQ: PLAY) and Jefferies Financial Group (NYSE: JEF).
Earnings Spotlight: Tuesday, March 29 Solo brands (NYSE: DTC), Lululemon (NASDAQ: LULU), microns (NASDAQ: MU), Soft (NYSE: CHWY) and HR (NYSE: HR).
Earnings Spotlight: Wednesday, March 30 Five below (NASDAQ: FIVE) and Paychex (NASDAQ: PAYX).
Earnings Spotlight: Thursday, March 31 Walgreens Boot Alliance (NASDAQ: WBA) and BlackBerry (NYSE: BB).
IPO and SPAC monitoring: Genius Group (GNS), Rail Vision (RVSN) and Wearable Devices (WLDS) could start trading next week as the IPO market looks to warm up a bit. IPO action lockout expirations have been reached for Guardforce AI (NASDAQ: GFAI) on March 28 and Olaplex (NASDAQ:OLPX) on March 29.
Projected dividend increases: Watco (New York Stock Exchange: WSO) is expected to increase its quarterly dividend to $2.20 per share from $1.95.
Corporate events: Gildan Activewear (GIL) will host a virtual Investor Day to provide an overview of the “Gildan Sustainable Growth” strategy on March 29. Immunovant (IMVT) will host an R&D Day event on March 30, while Five Below (FIVE) will host its inaugural Investor Day to showcase the company’s strategic plans and vision to 2025. Flex Ltd. (FLEX) will also organize an event for investors. On March 31, SunPower Corporation (SPWR) will host its Analyst Day event. The leaders will present the company’s new initiatives, its long-term strategic vision, its growth drivers and its market opportunities. Check out Seeking Alpha’s Catalyst watch for a full list of next week’s events that could impact stock prices.
Lululemon revenue overview: Investors will have a chance to learn more about Lululemon (LULU) entering the sale of its own line of running shoes. Jefferies warned that while the new products could be an attractive source of revenue, they might not be good for margins and could distract from the company’s core business. Lululemon has come out of the gate with a 30-day trial offer for new customers and is attracting strong interest according to Google search trends. The earnings conference call could dig deeper into how the early deployment unfolds for the company.
Micron revenue overview: Micron (MU) will report results next week as investors are cautious amid geopolitical headwinds, supply chain dynamics and general PC turmoil. Key issues in the earnings release and management conference call will be Micron’s update on DRAM and NAND offerings. Also look for more color on data center revenue and automotive DRAM market potential. Wells Fargo laid out full-year estimates on Micron ahead of the tech company’s own forecast and Street’s averages, while Citi is also constructive on Micron ahead of the report, saying the semiconductor maker is seeing a solid and stable dynamic random access memory pricing.
Deliveries of electric vehicles: The EV sector could get a boost this weekend when Tesla (TSLA) reports monthly deliveries and Chinese automakers Nio (NIO), Li Auto (LI) and XPeng (XPEV) release monthly delivery reports . Investors are trying to look past short-term headwinds, supply chain slowdowns and commodity inflation to see when production can be ramped up to meet supply. Looking ahead, Wedbush Securities believes Tesla could now be on track to see a run rate of 2 million units released in 2022.
Conference schedule: The conference program includes the Maxim Growth Conference, Bank of America Virtual Crypto Mining Conference, Bank of America ESG Consumer & Retail Conference, MedInvest Pharmaceutical and Biotechnology Investor Conference, Jefferies Pan-European Mid-Cap Conference and HC Wainwright & Co. Gene Editing and Therapy Conference.
Mentions of Barron: Netflix (NFLX) and other streaming stocks take their place on the cover this week ahead of the Oscars this weekend. While streamers have had a tough time with investors, the slow and steady transition away from cable TV is seen as an opportunity, and Netflix is seen as a long-term winner. Netflix’s first-mover advantage, global scale and massive content budget are known to differentiate the service and grow subscribers from a recent total of 222 million. Price increases around the world should help boost profit margins. Analysts are forecasting nearly $900 million in free cash flow for the company this year, rising to the billions in years to come. It should be noted that Netflix started buying back shares last year and is expected to continue. The shares are trading at around 32X expected earnings against the five-year average of 71X. Another potential stock gainer called this week is electrical component maker nVent Electric (NYSE: NVT). It is noted that the company is benefiting from the growth of automation, data centers and sensors to monitor complex systems for almost anything electrified.
Sources: EDGAR, Bloomberg, CNBC, Reuters, Renaissance Capital