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EARNINGS NEWS 📆

Back in the real world, Q4 earnings szn continues to chug along, albeit at a slightly slower pace than previous weeks.

Still, there’s quite a few notable companies slated to report quarterly earnings this week; and with the market as choppy as it’s been, we figured we’d briefly analyze the hype to see which reports are worth paying attention to. This week’s full schedule:

I. GAUGING THE HYPE 🌡️

First, we took a look back thru the news coverage surrounding each stock scheduled to report this week to get a sense of total ‘hype’.

Here’s each company’s total headline volume so far this year:

Companies reporting earnings this week with the highest news volume YTD:

1. Carnival Corp (CCL) — 1,115 headlines

2. Micron Technologies (MU) — 913 headlines

3. Wallgreens Boots (WBA) — 740 headlines

4. Skillz (SKLZ) — 444 headlines

5. Blackberry (BB) — 432 headlines

6. Cintas (CTAS) — 266 headlines 

Next, we took a look at the year-to-date sentiment (mood on a scale from -1.0 to +1.0) expressed in news articles about each company scheduled to report this week.

Here’s a look at each company’s average sentiment YTD compared to each companies change in stock price YTD:

The overall correlation is somewhat moderate (0.36). The stocks with most correlated sentiment vs. returns are:

1. Aehr Test Systems (AEHR) +87% return, +0.49 sentiment

2. Canoo (GOEV) -47% return, -0.11 sentiment

3. Aadi Bioscience (AADI) -40% return, -0.33 sentiment

4. Micron Technologies (MU) +20% return, +0.15 sentiment

5. Curiositystream (CURI) +19% return, +0.18 sentiment

6. BioNTech (BNTX) -15% return, -0.7 sentiment

Generally speaking, these companies seem to ride the hype more than others; when news sentiment is positive, they’ve tended to produce positive returns, and when sentiment is negative, they’re returns tend to be negative.

II. WHAT TO WATCH 👀

Now, a look at some notable news nuggets for companies scheduled to report earnings this week:

🔴 Micron (MU) | 📰 MarketWatch | 🗣️ Operating at a negative margin?

“Micron Technology Inc. may be paying more to make memory chips than the price it is charging for them… [Analyst] believes that this report will come in much worse than the collective consensus on Wall Street for both revenue and net losses, and he also predicts a massive write-down.”

🔴 Canoo (GOEV) | 📰 InvestorPlace | 🗣️ High burn rate is a concern

“While the company may be having little trouble securing orders (given its more than $2 billion backlog) for now, competition could start having an impact, as “old school” automakers move into the electrified commercial van market… The biggest concern with GOEV stock continues to be this early-stage EV company’s high levels of cash burn.”

🟢 Cintas (CTAS) | 📰 MotleyFool | 🗣️ Massive runway and room to grow dividends

“Cintas has grown sales and adjusted earnings per share (EPS) in 51 of the last 53 years… although the company trades at a premium P/E of 35, it only counts 6% of the total businesses in North America as customers, leaving a massive runway for growth. Cintas has a payout ratio of only 35%, showing that it should easily be able to continue increasing its dividend (currently yielding 1%), just as it has since 1983.”

🟢 Blackberry (BB) | 📰 YahooFinance | 🗣️ Selling patents for a big payout

“BlackBerrysaid last week that it agreed to unload "substantially all of its non-core patents and patent applications" to Malikie Innovations… the agreement terms say BlackBerry will receive $170M upon closing, and another $30M no later than the third anniversary of closing, as well as a cut of the profits generated from the patents.”

🟢 Skillz (SKLZ) | 📰 TipRanks | 🗣️ Beaten down stock with some upside

“Regarding Q4 estimates, Wall Street analysts expect Skillz Inc. to post earnings of -$0.12 per share… Last quarter, Skillz Inc. missed earnings estimates, reporting EPS of -$0.19 on estimates of -$0.13… Wall Street’s consensus rating for SKLZ stock is a Moderate Buy, with an average analyst price target of $1.73, implying upside potential of 237.03% from current levels.”

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.

SENTIMENT KEY: 🟢=bullish, 🌑=neutral, 🔴=bearish