Magnificent 7 Earnings Report Card: Here's How the Giants Fared So Far in Q1
Investing.com | May 07, 2024 17:01
- Earnings season is winding down, with the Magnificent 7 tech giants mostly exceeding expectations.
- In this piece, we will analyze their performance and future outlook using InvestingPro.
- Meanwhile, Nvidia is the only one left to report, so we will take a look at what to expect from the chipmaker.
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These past few weeks have been a whirlwind of earnings reports, with all but one member of the Magnificent 7, namely NVIDIA Corporation (NASDAQ:NVDA), stepping up to the plate:
Let's dive into their performance and what it might mean for their future using InvestingPro's analysis of post-earnings impact and current analyst estimates.
h2 Apple/h2Apple exceeded expectations in its quarterly earnings report, boasting an EPS of $1.53 compared to the anticipated $1.50, alongside revenue reaching $90.8 billion against the expected $90.32 billion.
Notably, the announcement of a colossal $110 billion share buyback plan garnered significant attention.
Despite Warren Buffett's Berkshire Hathaway (NYSE:BRKa) selling 13% of its Apple stock, causing a minor dip in yesterday's trading, the overall market response to the report was overwhelmingly positive, with a robust 8.32% uptick.
Source: InvestingPro
However, valuations remain high based on the 14 mathematical models developed by InvestingPro.
Source: InvestingPro
h2 Tesla/h2
This quarter, Tesla delivered a pleasant surprise to investors. Despite widespread expectations of a significant downturn, the stock experienced a notable rebound. Remarkably, this occurred despite the quarterly results showing a negative performance.
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The resurgence can be attributed to the reintroduction of affordable vehicles and the groundbreaking partnership with Baidu (NASDAQ:BIDU) to manufacture self-driving cars in China, a move that caught analysts off guard, dubbing it the "Musk effect."
Investors responded enthusiastically to the quarterly report, driving the stock up by over 14 percent.
Source: InvestingPro
However, even here the stock seems in line with current prices, as we can see from its estimated fair value
Source: InvestingPro
h2 Microsoft, Amazon/h2Microsoft and Amazon have quietly released better-than-expected earnings and turnovers recently. Despite this, the post-quarterly stock prices didn't see a positive boost, likely due to already high expectations.
Source: InvestingPro
Source: InvestingPro
Both then are still overvalued according to estimated Fair Values.
Source: InvestingPro
Source: InvestingPro
h2 Meta Platform/h2Meta suffered a heavy blow from the quarterly report, despite its overwhelmingly positive nature. The following day saw a double-digit decline for the tech giant. It's worth noting that Meta had been one of the top performers in 2023, possibly indicating that a break was overdue.
However, the sharp decline following such a promising quarterly report is undoubtedly frustrating for its shareholders. This is especially true when contrasted with Tesla's performance, which reported worse-than-expected accounts but still managed to deliver strong earnings.
Source: InvestingPro
The stock in any case still remains overvalued thanks to the 2023 run.
Source: InvestingPro
h2 Alphabet/h2Alphabet stands out in this regard, as it not only reported a strong quarterly performance but also saw a significant increase in its stock price.
Unlike its peers, Alphabet appears to have capitalized on the emerging trend in artificial intelligence more effectively, resulting in a notable boost to its financials. Following the data release, the stock surged by nearly 8%.
Source: InvestingPro
Alphabet, like all the other biggies, also trades at high valuations to date.
Source: InvestingPro
h2 Yet to Report: Nvidia/h2We now come to Nvidia, the most talked-about stock in recent months, which is yet to report. The date is May 22, where EPS estimates are at $5.55 per share and revenue estimates at $24.4 BILLION.
Source: InvestingPro
Nvidia has consistently delivered strong quarterly performance, setting a precedent for market outperformance. The recent announcement of a dividend has further bolstered investor confidence, typically resulting in a surge in the stock's value post-data release.
However, a looming question remains: will this trend persist? Given current valuations, there's speculation as to whether the market will continue to factor in Nvidia's impressive and sustained growth trajectory.
Source: InvestingPro
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