AVAH - Stocks To Watch: Big Week On Tap For McDonald's Shopify GameStop And Johnson & Johnson

2023-12-02 10:00:00 ET

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The economics calendar next week will be highlighted by the U.S. jobs report on Friday. The nonfarm payrolls report could be high stakes for interest rate watchers as it arrives just five days before the Federal Reserve's December 13 meeting. Economists forecast payrolls growth will rise to 200K in November from 150K job additions in October, and the unemployment rate to stay steady at 3.9%. In addition, the JOLTS and ADP reports will be released earlier in the week. The event calendar is busy with Shopify (SHOP), McDonald's (MCD), Johnson & Johnson (JNJ) all hosting investor events that could include guidance and strategy updates. The earnings calendar includes reports from Broadcom (AVGO), Lululemon (LULU), GameStop (GME) ( preview ), Chewy (CHWY) ( preview ), C3.ai (AI) ( preview ), and Dollar General (DG).

Earnings spotlight: Monday, December 4 - GitLab (GTLB) and JOANN (JOAN).

Earnings spotlight: Tuesday, December 5 - AutoZone (AZO), Box (BOX), Toll Brothers (TOL), MongoDB (MDB), NIO (NIO), and J.M. Smucker (SJM).

Earnings spotlight: Wednesday, December 6 - Brown-Forman (BF.A), Campbell Soup (CPB), C3.ai (AI), Chewy (CHWY), Sprinklr (CXM), GameStop (GME), and ChargePoint Holdings (CHPT).

Earnings spotlight: Thursday, December 7 - Broadcom (AVGO), Lululemon (LULU), Dollar General (DG), DocuSign (DOCU), and Guidewire Software (GWRE).

Volatility watch: Short interest levels pushed higher again on Faraday Future Intelligent Electric (FFIE) and Fisker (FSR). Options trading volume spiked on GameStop (GME) ahead of earnings. The most overbought stocks per their 14-day relative strength index are Aveanna Healthcare (AVAH), Bluegreen Vacations Hold (BVH), Gyre Therapeutics Inc (GYRE). The most oversold stocks per their 14-day Relative Strength Index are reAlpha Tech (AIRE), Ventyx Bio (VTYX), Eagle Pharma (EGRX).

Dividend watch: Companies projected to boost their quarterly dividend payouts include Zoetis (ZTS) to $0.43 from, $0.375, Mastercard (MA) to $0.63 from $0.57, Stryker (SYK) to $0.82 from $0.75, Amgen (AMGN) to $2.32 from $2.13, and Broadcom (AVGO) to $5.00 from $4.60. See Seeking Alpha's list of Quick Dividend Stock Picks.

IPO watch: No new IPOs are scheduled to debut next week as the market heads into what could be a slow period for new offerings. Looking ahead to 2024, casual dining group Panera Brands has confidentially filed for an initial public offering, with plans for a listing next year. Chinese-founded fast-fashion giant Shein also recently filed confidentially to go public. Reddit, Fanatics, and Skims are also anticipated to be in next year's IPO class.

Spotlight on McDonald's: McDonald's (MCD) will hold an investor event on December 6. The restaurant operator is expected to update on unit development in the U.S. and international markets, digital initiatives, and provide its long-term financial outlook. Additional topics that Oppenheimer thinks could create some buzz include more color on the recent China acquisition, royalty rate increases, franchisee relations, and automated order-taking initiatives. The last long-term guidance update from McDonald's dates all the way back to 2017, when management said it expected 3% to 5% system sales growth, mid-40% operating margin, and high-single-digit EPS growth. Analysts think that the new outlook could surprise to the upside, with the pandemic disruption over and McDonald's expected to increase its focus in high-population regions of the U.S. South and Southwest.

Domino's Pizza Investor Day preview: Domino's Pizza (DPZ) will host an Investor Day event from 9:00 a.m. to 12:00 p.m. Eastern time on December 7. This event will include presentations by CEO Russell Weiner and members of Domino's executive leadership team, as well as a question-and-answer session. UBS expects Domino's will highlight insights into key growth drivers, including initiatives to accelerate U.S. sales trends and strengthen global store expansion. The pizza chain operator is also anticipated to address long-term growth targets, which the firm expects could include an increase or tightening of the current mid-term outlook for 4% to 8% global retail sales growth. UBS also expects commentary on key U.S. sales drivers, including the Uber Eats partnership, enhanced loyalty program, carryout, and innovation. Potential positive catalysts from Domino's could include data on app downloads following the loyalty program changes and updates on menu innovation strategy. There could also be some interesting teasers on technology opportunities, including the recently announced AI partnership with Microsoft (MSFT).

Eyes on Johnson & Johnson: Johnson & Johnson (JNJ) will hold a Pharma/MedTech investor day on December 5. Analysts expect the focus to be on the longer-term outlook for Pharma and MedTech businesses. The event will mark the first time that Johnson & Johnson will review both Pharma and MedTech at the same time. In Pharma, UBS expects JNJ to reiterate confidence in guidance for $57B ex-FX sales by 2025 and highlight the next wave of growth drivers for 2025 and beyond after the U.S. Stelara loss of exclusivity. Johnson & Johnson (JNJ) is also expected to highlight key in-market drugs like Carvykti and Darzalex, as well as the strength of its pipeline in areas like immunology, oncology, and neuroscience. Investors could also hear an update on JNJ's capital allocation strategy.

Conference schedule: The Barclays Global Technology, Media and Telecommunications Conference is being viewed as the biggest conference of the week. The long list of companies that will give presentations includes Intel (INTC), Lyft (LYFT), Appian (APPN), UiPath (PATH), AMD (AMD), and Microsoft (MSFT). Workday (WDAY) Co-CEO Carl Eschenbach will deliver a keynote address at the event. Other notable conferences include the Craig-Hallum's Online Gaming Conference, Raymond James Technology Investors Conference, Morgan Stanley's Global Consumer & Retail Conference, and Wolfe Research 1st Annual Small & Mid-Cap Conference.

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