July 20, 2020, 10:50 a.m. EDT

A Week of Dow and Tesla to "Cure" COVID-19-Tainted Earnings

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Jul 20, 2020 (IAM Newswire via COMTEX) -- Without any sugar-coating, this earnings reporting season is so far living up to expectations that it will be the worst since the 2008 financial crisis. Until now, S&P 500 components have posted a 47.4% decline in second-quarter profits with nearly 9% of reports issued. Based on delivered reports as well as expectations, FactSet analysts predict that earnings for the whole index will plummet nearly 45%. This could be the biggest drop since a 69% plunge during the worst times of the Great Recession which stroke the fourth quarter of 2008. Retail, travel and energy companies are in for the biggest declines in sales and profit. But some were exempt from this dreadful fate.

After Delta Air Lines Inc. /zigman2/quotes/200327741/composite DAL +1.24% delivered a $5.72 billion loss for the June quarter and warned that a "sustainable recovery" is more than two years away, United Airlines Holdings Inc /zigman2/quotes/205037281/composite UAL +0.62% and Southwest Airlines Co (nyes:LUV) are "on board" this week, as far as earnings reports are concerned.

As for Dow Jones Industrial Average, eight of its components will report this week as will 80 S&P 500 members. And several big names could offer some better news. Tesla Inc. /zigman2/quotes/203558040/composite TSLA +2.25% and Microsoft Corporation /zigman2/quotes/207732364/composite MSFT +0.97% will deliver on Wednesday and Intel Corporation /zigman2/quotes/203649727/composite INTC +1.02% on Thursday. Hopefully, they will provide hints that the pace is picking up.

Some analysts are expecting a narrower loss than a year ago whereas others are hoping that the company can post a surprise GAAP profit. After it announces results on Wednesday, Tesla could end up meeting every requirement for entering the S&P 500 index, which requires four straight quarters of profitability for entry. The EV pioneer has already achieved three consecutive quarters of profitability. With the fourth one, it could be added to the index at any time. The anticipation of that event is surely helping boost its price as Tesla's stock skyrocketed during the first half of the year. Although Musk has fallen short of some of his bold promises, he did deliver quite a few. SpaceX has put humans into orbit and Tesla became not only the EV brand that consumers want but also the best-selling luxury car while it pushed the entire auto industry into electrification.

Twitter Inc. /zigman2/quotes/203180645/composite TWTR +2.55% reports on Thursday morning and Snap Inc. /zigman2/quotes/205087158/composite SNAP +1.88% on Tuesday afternoon. Twitter is bound to have gained some points for taking a stand against social injustice, unlike Facebook /zigman2/quotes/205064656/composite FB +1.99% . But, its recent security breach will surely come under the spotlight.

Snap's revenue growth is expected to have decelerated from the first quarter to the second quarter, but a double-digit ad growth relative to a year ago given the "growing appetite" for Snap's direct-response ads is likely in the cards. And let's not forget that this platform is a favorite among youngsters. Together, Twitter and Snap will shed some light on how is the ad market handling the pandemic.

On Thursday morning, AT&T Inc. /zigman2/quotes/203165245/composite T +0.21% will report its pandemic performance, with Verizon Communications Inc. /zigman2/quotes/204980236/composite VZ -0.13% following the next day. Both players saw their equipment revenue dive as stores closed due to COVID-19, but things could be picking back up with eased social distancing measures. Yet, AT&T is also dealing with other challenges. Film production at Warner Bros. has been put to a halt, media channels have been harmed with less ad spending and DirecTV is being hit with an avalanche of cord-cutting. On a brighter note, the wireless segment should remain a bright spot.

There's at least one Dow member on the schedule every day in the week ahead. International Business Machines Corp. /zigman2/quotes/203856914/composite IBM +0.25% will open the week on Monday afternoon, followed by The Coca-Cola Company /zigman2/quotes/209159848/composite KO -0.47% on Tuesday morning and Microsoft on Wednesday afternoon,. As for Thursday, Travelers Cos. Inc. /zigman2/quotes/206313935/composite TRV -0.24% and Dow Inc. /zigman2/quotes/203121064/composite DOW -0.23% will take the morning stage and Intel will report in the afternoon. On Friday morning, American Express Company /zigman2/quotes/203805826/composite AXP +0.37% and Verizon will wrap up the week. And if that's not enough for you, there is also the Chipotle Mexican Grill Inc. /zigman2/quotes/200781108/composite CMG +0.87% which is expected to have handled the pandemic and consequent restrictions on indoor dining better than expected.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure . IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you're interested in becoming an IAM journalist contact: contributors@iamnewswire.com

The post A Week of Dow and Tesla to "Cure" COVID-19-Tainted Earnings appeared first on IAM Newswire .

COMTEX_368240368/2618/2020-07-20T10:50:22

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