Key Earnings Reports to Watch This Week Before the Holiday Season

The final full trading week before Christmas features a lighter earnings calendar, but several significant companies are still set to release their quarterly results. Market attention will also be focused on the year’s final interest rate decisions from the US Federal Reserve and the Bank of England. Key earnings releases include Nike’s first report under its new CEO and Micron’s results following a substantial US government subsidy. This week offers valuable insights into various sectors, from sportswear and technology to professional services and logistics.

Nike (NKE) – Q2 Earnings Expected Thursday, December 19th

Nike’s stock performance has been challenged this year, down 28% year-to-date, with previous earnings releases contributing to the decline. The company’s Q1 results, released in early October, revealed revenues of $11.59 billion, slightly below analyst expectations of $11.65 billion and a 10% drop compared to the same period last year. While earnings per share of $0.70 surpassed Wall Street estimates of $0.52, it still represented a 26% decrease year-over-year. Adding to the complexity, Nike withdrew its full-year guidance and postponed its investor day amidst the CEO transition from John Donahoe to Elliott Hill in October. Since then, Nike has focused on solidifying key sports partnerships with organizations like the NBA, WNBA, and the NFL. Deutsche Bank analysts suggest that significant benefits from product innovation under the new CEO may not materialize until 2025. Bank of America maintains a “buy” rating on Nike but recently lowered its price target from $100 to $95.

Micron Technology (MU) – Q1 Earnings Expected Wednesday, December 18th

Micron recently secured a significant $6.1 billion subsidy from the US Department of Commerce to bolster domestic semiconductor manufacturing. This funding will support Micron’s ambitious plans to invest approximately $100 billion in New York and $25 billion in Idaho over the next two decades, potentially creating around 20,000 jobs. This initiative aims to increase the US share of advanced memory manufacturing from less than 2% to around 10% by 2035, amid escalating trade tensions with China in the semiconductor sector. For Q1, Micron forecasts revenue of $8.7 billion, exceeding the analyst consensus of $8.3 billion. The company reported full-year revenue of $25.1 billion in September, a notable increase from $15.5 billion the previous year. While Micron’s stock has experienced volatility this year, it remains up 15% year-to-date.

Accenture (ACN) – Q1 Earnings Expected Thursday, December 19th

Accenture is capitalizing on the growing demand for AI integration across various industries. The company reported $1 billion in new AI business bookings in its Q4 results, up from $900 million in Q3, with total generative AI new bookings reaching $3 billion for the year. Accenture’s recent partnership expansion with Nvidia aims to accelerate enterprise AI adoption. Nvidia CEO Jensen Huang highlighted Accenture’s crucial role as the “connecting fabric” between their technology and clients. For Q1, Accenture anticipates revenue between $16.85 billion and $17.45 billion, representing a 2% to 6% increase. The company projects full-year revenue growth of 3% to 6% and earnings per share between $12.55 and $12.91. Accenture also plans to return at least $8.3 billion to investors through dividends and share buybacks. Despite a summer slump, Accenture’s stock is currently up nearly 3% year-to-date.

FedEx (FDX) – Q2 Earnings Expected Thursday, December 19th

FedEx experienced a significant stock decline in September following a disappointing quarterly report. The company reported fiscal Q1 profits of $892 million, falling 24% short of analyst expectations. FedEx also lowered its full-year earnings per share guidance to $20-$21 from the previous $20-$22 range. CEO Raj Subramaniam attributed the weaker performance to inflationary pressures impacting customer shipping choices. Despite the Q1 setback, FedEx shares have partially recovered, showing a 12% year-to-date gain. Goldman Sachs recently upgraded FedEx to a “buy” rating and raised its price target from $370 to $420.

Birkenstock (BIRK) – Q4 Earnings Expected Wednesday, December 18th

Birkenstock’s stock has experienced volatility since its New York Stock Exchange debut in October 2022, though it remains up nearly 31%. Despite reporting a 19% year-on-year revenue increase to €565 million and a 15% rise in adjusted EBITDA to €186 million in Q3, the results missed Wall Street expectations, leading to a stock decline. CEO Oliver Reichert emphasized the record quarterly revenue achieved in Q3. The company opened seven new stores, bringing its total to 64. Birkenstock maintains its full-year guidance of 20% revenue growth and an adjusted EBITDA margin of 30% to 30.5%. While the Q3 results triggered a sell-off, Stifel managing director Jim Duffy views it as a temporary setback. UBS recently reaffirmed its “buy” rating on Birkenstock but lowered its price target from $85 to $83.

Other Notable Earnings This Week:

Monday, December 16th: Videndum (VID.L)

Tuesday, December 17th: Bunzl (BNZL.L), Hollywood Bowl (BOWL.L), Chemring (CHG.L), Capita (CPI.L), ThyssenKrupp Nucera (NCH2.DE), Heico (HEI)

Wednesday, December 18th: General Mills (GIS), Jabil (JBL)

Thursday, December 19th: Serco (SRP.L), Carnival (CCL), Darden Restaurants (DRI), CarMax (KMX), BlackBerry Limited (BB)

These earnings reports, along with the anticipated central bank decisions, will likely shape market sentiment heading into the holiday period. Investors will be closely analyzing the results for indications of economic strength, corporate performance, and future outlook.