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    Home»Investment»Analysts have cut earnings estimates on these stocks reporting next week
    Investment

    Analysts have cut earnings estimates on these stocks reporting next week

    By Staff WriterOctober 17, 20244 Mins Read
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    Investors should keep an eye on companies that could disappoint on earnings and see their share price fall. Wall Street has been lowering its third-quarter growth estimates for months now. According to a recent FactSet note, companies in the S & P 500 are projected to see a 4.2% increase in earnings compared with the same quarter a year ago, down from an expected 7.8% on June 30. That’s not abnormal, however, as third-quarter growth estimates tend to decline in the preceding months. Nearly 10% of S & P 500 companies have already reported results, with more than 79% beating earnings estimates, according to FactSet. Several names could still disappoint, however. To find those that might, CNBC Pro screened FactSet for stocks in the S & P 500 that are reporting next week. These names have seen their earnings estimates cut by at least 10% over the past three and six months. Investor sentiment on Valero Energy has taken a significant dive ahead of its quarterly results due on Oct. 24 . Analysts’ estimates for earnings per share have been cut by 80.3% over the past three months and 85% over the past six months. Still, the stock is favored by 60% of Wall Street analysts. One of them is Morgan Stanley analyst Joe Laetsch, who has an overweight rating and $165 price target on Valero. That indicates 22.5% potential upside for the stock, which has gained about 4% this year. ” We see VLO as well-positioned in the currently tight refining environment with its outsized downstream exposure relative to peers,” Laetsch said in a Tuesday note. “Its asset base is well-managed, and we think VLO will continue to execute, driving substantial [free cash flow] as the refining cycle advances.” Enphase Energy also made the screener, as analysts surveyed by FactSet have slashed their earnings per share estimates on the stock by nearly 39% and 35.5% over the past three and six months, respectively. Just under half of analysts rate the stock a buy. RBC Capital Markets analyst Christopher Dendrinos recently lowered his outlook on the stock, downgrading Enphase to sector perform from outperform on Tuesday. He also slashed his price target by $25 to $100, which suggests the beaten-down stock can gain 8.6%. Dendrinos’ new outlook on the name reflects his concerns that Enphase will see a slower pace of growth next year amid sluggish demand in the residential solar market . The continued adoption of third-party ownership, or TPO, systems in the U.S. could also weigh on Enphase’s demand growth, he said, as the company has less market share in TPO systems compared with its competitors. With a TPO model , installers maintain ownership of the energy system while the homeowner makes monthly payments for either the panels or electricity, according to Enphase. Shares of the company, which will report on Oct. 22 , are down 30% year to date. Tesla is set to report earnings on Oct. 23 after the market close. The company has a high bar to overcome before its stock can see a sizable jump, as the struggling electric vehicle maker disappointed on third-quarter deliveries and failed to impress investors with its hyped-up robotaxi unveiling earlier this month. Analysts have cut their earnings per share estimates on Tesla by 24.1% over the past three months and 30.8% over the past six months. In all, 34.5% of analysts rate the automaker a buy. Wells Fargo is on the bearish side of Tesla heading into earnings, as it reiterated an underweight rating on Tuesday and said it expects the company to miss third-quarter estimates.

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