The Zacks Analyst Blog Highlights: Amazon, Google, Facebook, Starbucks and Apple

Zacks Equity Research
·5 min read

For Immediate Release

Chicago, IL – October 30, 2020 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Amazon.com, Inc. AMZN, Alphabet Inc. GOOGL, Facebook, Inc. FB, Starbucks Corporation SBUX and Apple Inc. AAPL.

Here are highlights from Thursday’s Analyst Blog:

Big Tech (Mostly) Blows Doors Off Estimates: AMZN, AAPL, GOOGL, FB and More

Where to start? The biggest of the Big Tech companies are all reporting earnings Thursday after the close of regular trading. Based on market cap, this is the biggest day of Q3 earnings season (not all are reporting for Q3), though the biggest of the big — Apple — always waits to make its appearance. Let’s check the others first:

Amazon posted a big beat on its Q3 bottom line: $12.40 per share was miles ahead of the $7.30 expected, and nearly 3x the year-ago earnings number of $4.23 per share. Revenues also posted a solid outperformance, with $96.2 billion in the quarter beyond the $92.9 billion analysts were looking for. Sales growth rose 37% in the quarter. Both North America and International sales were slightly above estimates. AWS cloud business was in-line with estimates at $11.6 billion, while Operating Cash Flow was up 56%.

Guidance for Amazon’s all-important holiday shopping season Q4 took a big step up, now expecting $112 billion - $121 billion next quarter. Operating income guidance was down, however, which must be the main reason shares are trading down more than 1% on the news. Then again, this is what can happen when your stock is up 70% year to date, even after Wednesday’s big sell-off. For more on AMZN’s earnings, click here.

Alphabet also blew the doors off EPS estimates, to $16.40 per share versus $11.40 expected, with $46.17 billion in sales far outpacing the $35.36 billion consensus. YouTube new adds brought in $5 billion for the quarter, while its Cloud business came in at $3.44 billion, ahead of the $3.22 billion expected. Shares have shot up 7.5% on the earnings report; Alphabet had been lagging its Big Tech counterparts a bit previously. For more on GOOGL’s earnings, click here.

Facebook also surpassed expectations on its top and bottom lines: $2.71 per share on $21.47 billion beat the $1.94 per share and $19.89 billion in revenues. The social media staple’s EPS swung to a positive from expectations year over year. Daily and Monthly Active Users (DAU & MAU) came in slightly lower than anticipated, which the company expects to continue into Q4; its Q2 adds were tremendous during the heart of the “shelter in place” period of the pandemic. For more on FB’s earnings, click here.

Stepping out of Big Tech a moment, Starbucks surprised to the upside in what was expected to be a pull-back quarter as pandemic conditions have wreaked havoc on foot traffic. Earnings of 51 cents per share beat the 33 cents in the Zacks consensus, with $6.2 billion in sales topping the $6.08 billion we were looking for. Both figures are still down year over year. Same-store sales were down in the U.S., International and Chinese markets, but all performed better than expected. For more on SBUX’s earnings, click here.

Apple shares are down 4% in late trading upon its fiscal Q4 earnings release: 73 cents per share amounts to a 4-cent beat on the consensus estimate, with $64.7 billion beating estimates of $63.4 billion. However, lower-than-expected iPhone sales in the quarter — 26.4 billion units, versus 27.9 billion anticipated — are hitting the stock after hours.

Gross Margins of 38.2% were even, with Services better than expected at $14.5 billion. Mac and iPad sales were relatively in-line. However, the company gave no guidance for fiscal Q1. For more on AAPL’s earnings, click here.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.


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