Earnings Previews: Alphabet, Coca-Cola, Enphase, Microsoft, Visa

Dow component and Warren Buffett favorite Coca-Cola Co. (NYSE: KO) has posted a share price gain of 3% over the past 12 months. Since posting a 52-week high in late April, the share price has dropped by nearly 14%. When Coke reported first-quarter results in April, the stock was up 27% over the previous 12 months. The company reports earnings first thing Tuesday morning.

The company has earned a spot on the Dividend Kings list for having raised its dividend every one of the past 50 years. Coca-Cola’s regular dividend and 78% payout ratio are strong incentives for buying and holding on to the stock.

Analysts are bullish on the stock, with 19 of 26 analysts having a Buy or Strong Buy rating. Another six have a Hold rating. At a share price of around $56.00, the upside potential based on a median price target of $66.00 is 17.9%. At the high price target of $78.00, the upside potential is 39.3%.

Third-quarter revenue is forecast at $10.5 billion, down 7.1% sequentially but 4.6% higher year over year. Adjusted EPS are pegged at $0.64, down 9% sequentially and down by a penny year over year. For the full 2022 fiscal year, consensus estimates call for EPS of $2.45, up 5.8%, on revenue of $42.04 billion, up 8.7%.

Coca-Cola stock trades at about 22.8 times expected 2022 EPS, 22.0 times estimated 2023 earnings of $2.54 and 20.5 times estimated 2024 earnings of $2.73 per share. The stock’s 52-week range is $52.28 to $67.20. Coca-Cola pays an annual dividend of $1.76 (yield of 3.15%). Total shareholder return for the past year was 6.1%.

Enphase

Solar energy component maker Enphase Energy Inc. (NASDAQ: ENPH) has seen its share price jump by about 40% over the past year. Since posting its annual low in late January, the stock is up by nearly 97%. The big boost came in July, and it peaked in mid-September after the company struck a deal with a Munich-based renewable energy company. Shares have dropped more than 20% since then, likely because the impact from the Inflation Reduction Act on Enphase’s revenues is expected to be less than originally believed. The company reports quarterly results after Tuesday’s closing bell.

Brokerages are bullish on the stock, with 20 of 30 analysts having a Buy or Strong Buy rating and nine others rating the shares at Hold. At a share price of around $252.00, the implied gain based on a median price target of $290.50 is about 15.3%. At the high target of $363.00, the upside potential is 44%.

For the third quarter, analysts have forecast revenue of $618.85 million, up 16.2% sequentially and about 75.2% higher year over year. Adjusted EPS are forecast at $1.09, up 2.1% sequentially and by 81.7% year over year. For the 2022 fiscal year, analysts estimate EPS at $4.07, up 69.1%, on revenue of $2.24 billion, up 62.3%.

Enphase’s shares trade at about 61.8 times expected 2022 EPS, 50.3 times estimated 2023 earnings of $4.17 and 41.7 times the estimated 2024 earnings of $6.04 per share. The stock’s 52-week range is $113.40 to $324.84. Enphase does not pay a dividend. Total shareholder return for the past year was 40.2%.