5 Stocks to Watch Monday – Wednesday: AAPL, TWTR, YELP, PNRA, GPRO

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Tuesday, October 27

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Wednesday, October 28

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Apple, Inc. (AAPL)

Information Technology – Computers & Peripherals | Reports October 27, after the close.

The Estimize consensus, made up of an incredible 754 estimates at this point, calls for EPS of $1.91, 3 cents higher than the Wall Street consensus and signaling YoY growth of 34%. Revenues of $51.345B are also above the Street’s consensus for $50.798B and company guidance of $50.0B.

imageWhat to watch: Investors will be waiting with great anticipation to hear how sales of the iPhone 6s and 6s Plus are faring. Three days after the official launch in late September, Apple sold more than 13 million units in one weekend, a company record. This is up from the 10 million units that were sold during the first weekend of the iPhone 6 and iPhone 6 Plus launch. Much of the company’s success this year can be attributed to China, but can massive growth in that region continue? Earlier this year the company received approval from Chinese regulators to sell iPhones. During its fiscal Q2 2015 report back in April, Apple reported that iPhone sales in China outpaced the U.S. for the first time ever. In the latest quarterly report released in July, YoY growth in Greater China was up 112%. The latest iPhone models were made available in China on launch day, something that wasn’t true of the iPhone 6/iPhone 6 Plus release. Investors will also be looking for updates on Apple Watch and Apple Music. After reaching $132 a share this summer, the stock is down nearly 10%, but has been rising into the report.

Twitter, Inc. (TWTR)

Information Technology – Internet Software & Services | Reports October 27 after the close.

Estimize looking for EPS of $0.06, 1 cent higher than Wall Street. Revenues are anticipated to come in at $560.58M vs. Wall Street at $556.99M and company guidance of $556.25M. This would put YoY EPS growth at 500% and revenue growth at 55%.

imageWhat to watch: Even more important than earnings and revenue figures are Twitter’s user growth and engagement numbers measured through monthly active users (MAUs). Monthly active users ended Q2 with 316M, up 15% YoY. The criticism around Twitter lately is that user growth isn’t increasing fast enough, and pales in comparison to FB’s 1.5B user base. One of the reasons for this is that new users find the platform too confusing, TWTR is trying to solve this with things like instant timeline which populates your feed based on interests. With online videos remaining one of the fastest growing segments, Twitter is betting big on video  through applications like Vine and Periscope. Mobile is still a big focus as well, and the company has done a solid job monetizing mobile partially due to new app install ads. Mobile currently makes up 89% of total ad revenues, and ad revenues make up 72% of total revenues. The implementation of Jack Dorsey as CEO will also be a big topic during this earnings report, as many question if he can handle the job in addition to being CEO of soon to IPO Square.

Panera Bread Co. (PNRA)

Consumer Discretionary – Hotels, Restaurants & Leisure | Reports October 27 after the close.

Estimize EPS consensus calling for $1.34, three cents above the Street. Revenues of $663.56M are just slightly higher than the Street’s $662.9M.

imageWhat to watch: It’s been a rough road for Panera which has missed top and bottom-line estimates in both quarters this year due to higher food costs, labor costs and stiff competition in the fast casual space. Up to this point, expenses have been adding up at Panera 2.0, a series of integrated technologies that include digital ordering and mobile payments, with no real results. However, improving same store sales in the second quarter, and indications of an even stronger third quarter (SSS growth in the first 27 days of Q3 came in at 4.7%) may be due to improvements in Panera 2.0 initiatives. In the interest of reaching consumers through multiple distribution methods, the company is ramping up its packaged goods offerings, estimated to be a $1B business, by making Panera branded products available to consumers in grocery stores.

Yelp, Inc. (YELP)

Information Technology – Internet Software & Services | Reports October 28 after the close.

The Estimize consensus is expecting EPS of -$0.07, two cents above Wall Street’s prediction. Revenues are just slightly higher at $141.65M vs. Wall Street’s $141.48B and company guidance of $140.50M.

imageWhat to Watch: Yelp typically comes under fire for having high costs and poor monetization despite a large user base. Results from the first two quarters of the year haven’t helped to dismantle that, with Yelp missing on both the top and bottom-line in Q1 and only missing EPS in Q2. During the second quarter the company lowered full year revenue guidance to a range of $544M to $550M from $574M to $579M. That announcement led to a huge selloff of the stock, which fell 34% by the next day’s close. Yelp’s local ads business drives most of its value, with average revenue per active local business (ARPALB) being a key metric to watch. The company has a total addressable market 76 million local businesses worldwide, a majority of those located in the Americas and Europe. However, the number of companies that actually pay for Yelp’s services only totaled 97,000 in Q2. The company is relying heavily on international growth, and while international traffic grew over 40% in the latest quarter, that hasn’t helped much with ARPALB.

GoPro (GPRO)

Information Technology – Computers & Peripherals | Reports October 28, after the close.

The Estimize consensus for GPRO stands at $0.33, 14% higher than the Wall Street consensus and growing. Revenues are expected to come in at $444M vs. the Street’s $438M.

imageWhat to watch: The biggest criticism of GoPro, despite significant growth this year, has been its inability to establish itself as more than just a commoditized action camera company. Adrenaline junkies are awaiting with bated breath the launch of the Hero 5 camera, which features 8K resolution and full ultra HD video recording. Other new products, such as the quadcopter drone set to be released in 2016, will have competition from similar offerings from Alphabet Inc. and Amazon. Aside from new products, GoPro is attempting to establish itself as a media and content  company. Their online platform allows GoPro users to upload original footage in hopes of making money from global ad agencies that want to purchase the content. The hope is that measures like this, as well as the GoPro Awards where the best videos win cash prizes, will build the company’s creator community. These moves, as well as some high-end hires from Hulu and CBS, cause many to think original content offerings could be on the horizon.

Get your estimates in for this week here!

(Photo Credit: Yutaka Seki)

Source: 5 Stocks to Watch Monday – Wednesday: AAPL, TWTR, YELP, PNRA, GPRO

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