the Dow Jones Industrial Average (DJINDICES: ^ DJI) On Monday afternoon it lagged behind the other major US stock indices, rising just 0.1% at 2 pm EDT after spending much of the day in the red. Confirmed cases of COVID-19 continue to rise in the United States, and some cities are receding in their reopens. In particular, Chicago is ordering the closure of interior service in bars, along with the enactment of other restrictions designed to stem the recent surge in cases.
Actions of the technological giant Microsoft (NASDAQ: MSFT) It emerged on Monday when analysts raised their price targets ahead of the company’s earnings report. In the meantime, Coca Cola (NYSE: KO) Shares fell as investors prepared for sharp declines in revenue and earnings.
Image source: Microsoft.
Microsoft price targets high before earnings
Cloud computing and software giant Microsoft is scheduled to report its fourth-quarter fiscal results on Wednesday, July 22. Analysts expect decent results, with average estimates requiring 8.2% revenue growth and flat earnings per share (EPS) compared to the previous one. year period In the third fiscal quarter, which ended in March, revenue increased 15% and EPS shot up 23%.
Analysts are increasingly optimistic about Microsoft despite the pandemic. Jefferies maintained its stock buy rating on Monday and raised its target price from $ 200 to $ 240. Jefferies expects impressive results from the company, but noted a historically high stock price as a cause for concern.
Barclays also increased its price target at Microsoft, from $ 204 to $ 234. While IT spending has been under pressure during the pandemic, Barclays expects Microsoft to be less affected. Raymond James also stepped in with a target price increase, raising his target from $ 208 to $ 225 due to Azure, Office 365, and the gaming business.
Exactly how Microsoft is doing in the coming months as the U.S. economy struggles under the weight of the pandemic is unclear. For one thing, switching to work at home will drive demand for some of its programs, such as Microsoft Teams. On the other hand, companies that fail due to the weak economy could eliminate some of Microsoft’s customers.
Microsoft shares rose 3.3% on Monday afternoon. Shares have shot up approximately 32% since early 2020.
Low expectations for Coca-Cola
Analysts are expecting some rough numbers for the beverage giant Coca-Cola when it reports its second-quarter results on Tuesday morning. Average estimates require a decrease in income of 28% and a decrease in profit of 37%. The company was hit by lack of demand from the restaurant industry during the pandemic shutdown.
In April, Coca-Cola revealed that it was experiencing declines in global volume of approximately 25% since the beginning of that month. Channels outside the home, which generally account for about half of the company’s total revenue, were largely responsible for the decline.
The company also said that its second-quarter and full-year results would depend on the duration of the social distancing and refuge requests in place, as well as the pace of the economic recovery. Restaurants have partially reopened for dinner in many areas of the United States, but with the increase in COVID-19 cases in some areas, the recovery of restaurant visits is at risk.
Coca-Cola shares fell 1.5% on Monday afternoon as investors prepared for a tough quarterly report. The stock has lost about 17% of its value this year.
