Earnings Previews: Mattel, Meta Platforms, ServiceNow

After U.S. markets closed on Monday, Cadence Design beat consensus estimates on both the top and bottom lines. Fiscal year guidance was in line with expectations as well. Investors were clearly hoping for more, as the stock traded down 1.5% shortly after Tuesday’s opening bell.

Cleveland-Cliffs missed Wall Street’s earnings per share (EPS) estimate by a penny while beating the revenue forecast. Still, revenue was down about 5.6% year over year. But shares traded up about 4.8%.

NXP Semiconductors beat top-line and bottom-line estimates. Guidance was in line with expectations, and the stock traded up about 3.7%.

Before markets opened on Tuesday, General Motors beat the consensus EPS and revenue estimates, with revenue up 25% year over year in the quarter. The automaker raised fiscal 2023 EPS guidance from a range of $6.45 to $7.35 to a new range of $7.15 to $8.15. The company also offered long-term guidance, including doubling annual revenue to a range of $275 billion to $315 billion by 2025 and targeting EV production of 1 million annually in North America by the same year. Shares traded down 3.2%.

General Electric beat estimates on both the top and bottom lines and also issued upside guidance for the 2023 fiscal year. EPS guidance rose from a prior range of $1.70 to $2.00 to a new range of $2.10 to $2.30. Shares traded up 5.5%.

GE HealthCare topped EPS and revenue estimates and issued in-line guidance. The stock traded up 1.8%.

Verizon beat the EPS consensus but missed on revenue. Broadband net additions topped 400,000 for the third consecutive quarter, and wireless revenue rose 3.8% year over year. Verizon also affirmed fiscal 2023 EPS guidance of $4.55 to $4.85. Shares traded up 0.6%.

After markets close on Tuesday, Alphabet, Microsoft and Visa are scheduled to release earnings reports. AT&T, Boeing and Coca-Cola are expected to share their results first thing Wednesday morning.

Here is a look at three companies set to report quarterly results after Wednesday’s closing bell.

Mattel

Toy maker and entertainment media company Mattel Inc. (NASDAQ: MAT) has added about 21% to its share price so far in 2023. The magic word, of course, is “Barbie.” Mattel has not revised guidance since its original estimate, but analysts have raised expectations sharply in the past month. The marketing campaign for the “Barbie” movie paid off with a $150 million opening weekend, and that cannot do anything but raise expectations even more. What remains to be seen is whether Mattel now lifts its own estimates.

Of 12 analysts covering the stock, 11 have a Buy or Strong Buy rating, and the other one has a Hold rating. At a recent price of around $21.50 a share, the upside potential based on a median price target of $24.00 is 11.6%. At the high target of $26.00, the upside potential is 20.9%.

Mattel is expected to report second-quarter revenue of $1 billion, which would be up 22.6% sequentially but down by 19.4% year over year. Analysts are forecasting an adjusted loss per share of $0.03, better than the prior quarter’s loss of $0.24 per share and worse than EPS of $0.18 in the year-ago quarter. For the full 2023 fiscal year, consensus estimates call for EPS of $1.16, down 6.8%, on sales of $5.44 billion, essentially flat year over year.

The stock trades at 18.5 times expected 2023 EPS, 14.5 times estimated 2024 earnings of $1.48 and 13.2 times estimated 2025 earnings of $1.64 per share. Its 52-week trading range is $15.36 to $24.38, and Mattel does not pay a dividend. The total shareholder return for the past year was negative 3.92%.