- Wall Street’s first quarter earnings season ends this week, and the results were better than feared;
- So, I used InvestingPro’s stock tracker to identify some of the biggest winners and losers at the end of the Q1 earnings season;
- Below is a list of five notable winners and five losers from this season’s results.
Despite fears of a possible recession or recession, Wall Street’s first quarter earnings season brought relief as the results further indicated that things may not be as dire as previously feared.
With more than 95% of companies having already published their results by Wednesday morning, the numbers are now available and tell a story of resilience. Interestingly, 78% of these companies exceeded earnings per share estimates, and an equally impressive 76% exceeded revenue expectations.
This strong performance reduced the year-on-year decline in Q1 profit to just -2.2%, a slight decline from the -6.7% forecast on March 31.
As the dust settles, it’s time to look back and determine which companies weathered the storm and which struggled through the rough times.
In this article, I’ll highlight five notable winners and five notable losers of Wall Street’s first quarter earnings season.
Using the InvestingPro stock tracker, I also reviewed the upside and downside of each brand based on their Investing Pro value models.
The top 5 winners after the publication of the first quarter:
1. Meta Platforms
On April 26, Meta Platforms (NASDAQ: ) posted a surprisingly strong first quarter according to ; experienced an unexpected increase in revenue after three quarters of decline. Parent company Facebook’s forecast for the second quarter also exceeded expectations.
Shares in the Mark Zuckerberg-led company soared alongside technology and jumped 105% since the start of the year, making META one of the best performing stocks this year.
It should be noted that even after the stock has more than doubled since the beginning of the year, META is still undervalued according to quantitative models at InvestingPro and could gain 17.9% from Tuesday’s closing price of $246.74.
Palantir (NYSE: ) posted its first quarter on May 8. The data from the release beat analysts’ estimates, both in terms of top and bottom lines. CEO Alex Karp said the data analytics software company expects to remain profitable every quarter through the end of the year.
Shares of this data miner have risen again this year and so far in 2023, they are up 96.9%. Despite the recent swing, the stock remains about 70% below its January 2021 high of $45.
Palantir stock appears overvalued according to multiple valuation models at InvestingPro. At the time of writing, the average fair value for PLTR is $9.25, a potential downside of nearly 27% from Tuesday’s closing price of $12.64.
3. Uber Technologies
Uber Technologies (NYSE: ) posted its first quarter on May 2. The figures presented easily exceeded analysts’ expectations for revenue and earnings, with sales up 29% year over year. In a prepared statement, CEO Dara Khosrowshahi said Uber had a “good start” to the year.
Shares of the mobility-as-a-service specialist are up nearly 56% year-to-date in 2023, outpacing comparable gains from industry peer Lyft (NASDAQ: ), whose shares are down nearly 26% over the same period.
According to InvestingPro, even with the recent gains, UBER stock could see a gain of 11.3% approaching a value of $43.02 per share.
4. Draft Kings
On May 4, DraftKings (NASDAQ:) posted first-quarter earnings that beat analysts’ estimates. Quarterly revenue increased 84% year-over-year to $769.7 million, driven primarily by successful new customer acquisitions.
Shares of DKNG are up 113% since the start of the year as investors grew more optimistic about the online gambling giant’s future prospects.
The average fair value of DraftKings stock on InvestingPro across a range of valuations – including P/E and P/S multiples – is $28.64, which is a potential upside of 18% over the current market value.
5. Chipotle Mexican Grill
On April 25, Chipotle Mexican Grill (NYSE: ) presented its results for the first quarter, and it was better than expected, also in terms of revenue. Same-restaurant sales rose 10.9%, beating the consensus of 8.6%. Looking ahead, Chipotle is forecasting single-digit same-restaurant sales growth for the full year.
Since the start of the year, the Newport Beach, Calif.-based fast-casual chain has gained 47.5%, outperforming the S&P 500’s gain of nearly 8% over the same period.
With a “fair value” of $1,971.56 according to InvestingPro’s quantitative models, CMG appears undervalued at current levels with a potential downside of around 4%.
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Top 5 losers after publication in the first quarter:
On April 19, Tesla (NASDAQ: ) posted a disappointing first quarter.
The EV founder led by Elon Musk said adjusted net income fell 24% to $2.51 billion, or $0.85 per share, from $3.32 billion, or $0.95 per share, a year ago. Commenting on the results, Musk highlighted macroeconomic uncertainty that could affect people’s plans to buy cars.
Tesla shares are up 50.8% since the start of the year. Despite the recent move, the stock remains below the November 2021 high of $414.50.
Despite headwinds in the near term, InvestingPro currently has a “fair value” price target of around $209 per share for TSLA, suggesting an upside of 12.6%.
On April 27, the company Snap (NYSE:). Unfortunately, these fell short of analysts’ revenue expectations due to poor results in the core digital advertising business. Although the social media company did not provide official guidance for the second quarter, it did warn that its “internal forecast” for revenue would be $1.04 billion, down 6% year-over-year.
Not surprisingly, SNAP stock has underperformed its established competitors since the start of the year, gaining 9.5% in 2023 year to date.
Looking ahead, the average fair price per share on InvestingPro is $10.54, a potential upside of 7.5% from Tuesday’s closing price of $9.80.
On May 10, Walt Disney (NYSE: ) reported weaker-than-expected earnings for its streaming service and reported a surprising drop of four million subscribers to its streaming service as consumers become more aware of the cost of their consumption habits. the media.
Shares in the entertainment company have outperformed the broader market in 2023, and DIS shares are up just 3.4% since the start of the year.
According to InvestingPro’s model, Disney stock remains undervalued and could see a 30.2% upside from current levels, approaching a value of $116.95 per share.
On April 20, AT&T (NYSE: ) delivered its disappointing performance The post revealed a sharp decline in profit and sales growth in an uncertain economic environment. In addition to the low and high figures, the telecom giant recorded an unexpected drop in customer growth in the postpaid customer segment.
Since the beginning of the year, T has fallen by 12.5%. Shares have sold off in recent weeks and AT&T shares have fallen near their lowest level since October 2022.
At a current price of about $16 per share, T-Share is being offered at a significant discount, according to quantitative models at InvestingPro, which indicate a 23.9% increase in stock value over the next 12 months.
5. Tyson’s Foods
Another nasty surprise was the publication of Tyson Foods (NYSE: ) results. The company posted an unexpected financial loss on May 8, while earnings also fell short of expectations due to disappointing results in the poultry industry. The poor results led the food company to lower its earnings forecast for this year as consumer demand weakened.
Shares in the meat and poultry producer have fallen 17% this year, touching a three-year low.
Despite the significant decline, the average fair value of TSN shares on InvestingPro suggests an increase of about 34% over the current market value over the next 12 months.
Reservation: At the time of writing, I don’t have time to use the S&P 500 and Nasdaq 100 through the ProShares Short S&P 500 ETF (SH) and the ProShares Short QQQ ETF (PSQ). I regularly balance my portfolio of individual stocks and ETFs based on the current risk assessment of the macroeconomic environment and corporate finances.
The opinions discussed in this article are solely those of the author and should not be construed as investment advice.