Harriet Lefton

About the Author Harriet Lefton

Harriet originates from the UK where she worked as a journalist specializing in the metal markets. She graduated from the University of Cambridge before becoming a qualified UK lawyer.

Looking Ahead of Wall Street: Tesla Inc (TSLA), Apple Inc. (AAPL), Shopify Inc (US) (SHOP)

Analysts have a lot to look forward to on Wall Street in the next few days, from the quarterly earnings report of controversial auto stock Tesla Inc (NASDAQ:TSLA) on August 2 to tech giant Apple’s (NASDAQ:AAPL) fiscal third quarter earnings report on August 1. In fact, August 1 will be a busy day as we also have the Q2 earning results for booming Canadian e-commerce company Shopify Inc (NYSE:SHOP).

So in advance of these key dates, let’s see what analysts are predicting that earnings will hold for these three major stocks:

Tesla Inc

Since the start of 2017, Tesla has ripped past expectations. Shares have spiked all the way from $217 to the current share price of $335. Prices dipped slightly from $344 over the weekend following reports of weak sales for Tesla’s luxury Model S/X sedan, but strong results could really see prices soar.

In terms of Street expectations, TSLA has a consensus EPS forecast of -$2 down from -$1.54 last year. For revenue, the Street is predicting $2.55 billion with $11.37 billion for the full year. Investors will also be looking out for three key updates: 1) further details on Model 3 production and deliveries; 2) how the company’s solar roof pilot production is developing and 3) if Tesla wants to notably boost its vehicle production and deliveries. In the first half of this year, Tesla delivered 47,100 vehicles- a 60% rise from the same period last year.

Tesla has just launched its much-hyped Model 3 all-electric sedan on July 28. Now an aggressive ramp-up is underway. Tesla has a goal of delivering 1,500 sedans in December, rising to 20,000 deliveries by the end of the year. Maintaining this schedule is important for Tesla to support its full-year guidance and to meet its 400,000 pre-orders.

Top Robert W. Baird analyst Ben Kallo says that investors will be looking for any commentary around demand. He recommends investors take any post-earnings weakness as a buying opportunity. Kallo reiterated his Buy rating on July 26 with a $385 price target- 9.8% upside from the current share price. So far Kallo has done well on Tesla stock- over his 41 Tesla ratings he has an impressive 73% success rate and 34.7% average return. (To watch Kallo’s track record, click here.)

On the whole analysts show a cautious outlook towards Tesla. On TipRanks, the stock has a Hold consensus rating. In the last three months, the stock has received 2 Buy, 6 Hold and 3 Sell ratings. The price targets show a very wide range- while the average 12-month price target comes out as $280.90 (-16.17% downside from the current share price), price targets reach all the way to $430 on the high and $165 on the low.

Apple Inc.

Tech giant Apple is releasing its fiscal third quarter results on August 1. If Apple disappoints in respect of its guidance for the much-hyped iPhone 8 launch later this year, then we can expect some serious stock fluctuations.

So what is the Street predicting for Apple on Tuesday evening? The current consensus is for EPS of $1.57 on revenue of $44.96 billion. iPhone unit sales of 39.95 million are expected- down 1% year-on-year. This is a seasonally soft quarter for Apple- although the September quarter could also be weak depending on the exact iPhone 8 launch date.

Increasingly, analysts are forecasting the possibility that the new iPhone launch will be delayed into their models. The launch date was expected to be September, as for previous iPhone models, but now an October launch is seen as a strong possibility. In particular, delays are possible for the 5.8 inch OLED screen model. However, any revenue shortfall due to a launch delay would no doubt be recovered in later quarters.

Today, five-star Drexel Hamilton analyst Brian White has reiterated his AAPL Buy rating with a bullish $202 price target (35% upside from current share price). He is impatient for the results to be over so we can move into the crucial make or break iPhone 8 launch period. White says: “Apple’s quarterly results and outlook will be less important this week as investors are focused on the iPhone 8 this fall”. He concludes that Apple remains one of the world’s most undervalued companies. (To watch White’s track record, click here.)

Apple has a “Strong Buy” analyst consensus rating with 24 Buy and 7 Hold ratings published on the stock in the last three months alone. We can also see that the average analyst price target of $167.92 suggests that Apple still has upside potential of over 12% for the next 12 months.

Shopify Inc (US)

Shopify will also be releasing its results on August 1, but before Tuesday’s open. The Street is expecting EPS of -$0.07 on revenue of $143.51 million. Shopify stock has exploded from $42 at the beginning of the year to its current price of $92.

However, as a result of this huge price movement, some analysts (see Goldman Sachs for example) now believe that the stock has little upside potential left to run. One of the more optimistic analysts is Alliance Securities’ Blair Abernethy. He reiterated his SHOP Buy rating 13 days ago with a $100 price target (8% upside from current share price). (To watch Abernethy’s track record, click here.)

Abernethy says Shopify is growing much faster than other SaaS platforms and that there are a number of potential catalysts for the stock including “new major platform partnerships, Shopify Plus traction with large companies, further take-up of the Shopify Capital offering, and tuck-in technology acquisitions.” For the whole of fiscal 2017, he is modelling for Adjusted EBITDA of $6.9-million on revenue of $629.1-million.

TipRanks reveals that Shopify has a Buy analyst consensus rating. This is based on the fact that in the last three months, analysts have been evenly divided between Buy and Hold ratings. Meanwhile the average analyst price target of $88.29 now stands at a -5.04% downside from the current share price.


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