Wall Street Breakfast: The Week Ahead

Investors will return next week with a new wildcard in the mix after the January jobs report smashed expectations to reinforce the view that the Federal Reserve will move forward with planned rate hikes. The labor market read is likely to keep Federal Reserve Chairman Jerome Powell on script when he speaks at the Economic Club of Washington D.C. on February 7. Earnings reports slow down in the week ahead, although there are some key releases to watch. On Seeking Alpha, author Daniel Varga is positive on Disney (DIS) ahead of the media giant’s earnings report. The stock is said to remain undervalued with Disney expected to deliver even when encountering declining consumer confidence. Value Pendulum sees a good chance for an earnings beat from Take-Two Interactive (NASDAQ:TTWO) with its mobile business expected to perform above exceptions (Read the full earnings preview). Meanwhile, Acutel called out Royal Caribbean (RCL) ahead of its earnings report with the cruise line operator said to be on the path to profitability (dig into the details). Within the energy sector, contributor Bram de Haas pointed out that potential share buybacks by BP (BP) were brought up by analysts on the last earnings call – and the author thinks the oil giant could deliver a welcome surprise to investors again. PepsiCo (PEP) and Chipotle (CMG) are the heavyweight from the consumer sector scheduled to spill earnings. On the event calendar, Canada Goose (NYSE:GOOS) has an investor day event scheduled and Google (GOOG) (GOOGL) is holding a search and AI event that could include some surprises.

Earnings spotlight: Monday, February 6 – Activision Blizzard (NASDAQ:ATVI), Tyson Foods (TSN), and Take-Two Interactive (TTWO).

Earnings spotlight: Tuesday, February 7 – BP (BP), Chipotle (CMG), Fortinet (NASDAQ:FTNT), Dupont (DD), Royal Caribbean (RCL), Lumen Technologies (LUMN) and Hertz Global (HTZ) report.

Earnings spotlight: Wednesday, February 8 – Disney (DIS), CVS Health (CVS), Dominion Energy (D), Uber (UBER), MGM Resorts (MGM), Affirm (AFRM) and Under Armour (UAA).

Earnings spotlight: Thursday, February 9 – AbbVie (ABBV), PepsiCo (PEP), Philip Morris (PM), PayPal (PYPL), Ralph Lauren (RL), Lyft (LYFT), and Kellogg (K).

Earnings spotlight: Friday, February 10 – Enbridge (ENB) and Magna International (MGA).

Volatility watch: Carvana (CVNA) and Beyond Meat (BYND) are positioned once again for a volatile week with short interest at a very high level. Silvergate Capital (SI) and Esports Entertainment (GMBL) are on the list of stocks with the highest implied volatility based on options trading. Nordstrom (NYSE:JWN) is expected to be a battleground stock with short interest at a high level and Ryan Cohen reported to have taken an activist stake.

IPO watch: Hesai Group (HSAI) is scheduled to go public on February 9. The China-based LiDAR specialist is noted to be the first company to deliver over 10K LiDAR units per month. Hesai joins an increasingly crowded LiDAR sector that includes Innoviz (INVZ), Luminar (LAZR), Ouster (OUST), Velodyne Lidar (VLDR), Aeva (AEVA) and AEye (LIDR). Read a preview of the IPO from Seeking Alpha author Donovan Jones. There are also IPO lockups during the week on blocks of shares of Treasure Global (NASDAQ:TGL), Forza X1 (NASDAQ:FRZA), and LuxUrban Hotels (NASDAQ:LUXH). Analyst ratings coverage will begin on Skyward Specialty Insurance Group (SKWD).

Dividend watch: Some of the notable companies expected to boost their quarterly dividend payouts next week include Primerica (NYSE:PRI) to $0.65 from $0.55, Rexford Industrial (NYSE:REXR) to $0.36 from $0.315, ITT (ITT) to $0.30 from $0.264, Northern Oil and Gas (NOG) to $0.33 from $0.30, Tractor Supply (TSCO) to $1.00 from $0.92, and Vulcan Materials (VMC) to $0.43 from $0.40.

Corporate events: Shareholders with Mountain Crest Acquisition Corp III (NASDAQ:MCAE) will vote on February 8 on the deal to take digital health company ETAO International public in a SPAC deal. ETAO considers itself a digital healthcare group providing telemedicine, hospital care, primary care, pharmacy and health insurance. Canada Goose Holdings (GOOS) will also host an Investor Day event focused on the apparel retailer’s long-term strategic initiatives and financial outlook. On February 7, Google (GOOG) will hold an event on Search and AI. Amid growing interest in AI, the tech giant said it will detail the power of AI to reimagine how people search for, explore and interact with information. Shopping, Maps, and Travel are also a few of the highlights that are expected to be highlighted at the event. The event will also be of high interest to Microsoft (MSFT), which has a stake in ChatGPT. C3.ai (NYSE:AI) and Nvidia (NVDA) have also been bid up recently on ChatGPT upside speculation. SoundHound AI (NASDAQ:SOUN) is also a volatile AI-related stock. On February 10, 2seventy bio (NASDAQ:TSVT) will present full Phase 3 data on Abecma (KarMMa-3) at the EBMT-EHA 5th European CAR T-cell meeting. The cancer therapy is being marketed by Bristol Myers Squibb (BMY). It will also be the last trading before the FDA action date on Regeneron Pharmaceuticals’ (NASDAQ:REGN) Eylea. Check out Seeking Alpha’s Catalyst Watch for more events scheduled for next week.

Eyes on auto: The Chicago Auto Show runs from February 9 to February 20. Automakers with press conferences scheduled on media include Subaru (OTCPK:FUJHY), Volkswagen (OTCPK:VLKAF), Honda (HMC), and Stellantis’ (STLA) Ram and Jeep brands. Electric vehicles will be on full display at the event including the Cadillac Lyriq, 2024 Chevrolet Blazer EV, Ford Mustang Mach-E, Ram 1005 Revolution Concept, Toyota BZ4X, Buick Wildcat Concept, and Chevrolet Silverado EV.

Quant ratings: Stocks with recent quant rating upgrades include Glencore (OTCPK:GLNCY) to Strong Buy from Hold, UBS (UBS) to Strong Buy from Buy, and Fiverr International (FVRR) to Buy from Hold. New quant rating downgrades include Farmer Bros. (FARM) to Sell from Hold and Harley-Davidson (HOG) to Hold from Buy. See the stocks with the very highest rated Seeking Alpha Quant Ratings.

Notable conferences: The biggest conference of the week could be the Stifel 2023 Transportation & Logistics Conference, which will include key updates from Heartland Express (HTLD), FTAI Aviation (NASDAQ:FTAI), Werner Enterprises (WERN), Matson (MATX), and Daseke (DSKE). The BIO CEO & Investor Conference and Guggenheim Oncology Conference are also on the calendar.

Barron’s mentions: Pfizer (NYSE:PFE) is the subject of the cover story this week with the stock called attractive after the sharp share price drop. Despite the drop in revenue after vaccine sales slowed, analysts think the pipeline is strong enough to support a bounce back. Key launches include vaccines for the respiratory syncytial virus, or RSV, meningitis, and the flu, and drugs to treat atopic dermatitis and multiple myeloma. Pfizer is also noted to have made the strategic move to offset patent losses in 2025 to 2028 through acquisitions for companies such as Arena Pharmaceuticals, Biohaven Pharmaceuticals, and Global Blood Therapies. The drug giant is estimated to be only 40% on the way to meeting its goal of $25M in revenue from acquired drugs in 20230. On a valuation basis, Pfizer trades at a 13X multiple and sports a well-protected dividend yield of 3.72%.

Sources: EDGAR, Bloomberg, CNBC, Reuters