Investing Action Plan: Navigating A Skittish Stock Market

The Nasdaq Composite, S&P 500 and the Dow Industrials ended lower for a second straight week as concerns over rising Russia/Ukraine tension weighed on investors confidence. All three benchmarks held above prior lows, leaving the stock market’s attempted uptrend intact, although under increasing pressure, heading into a short holiday trading week.

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Stocks including Matador Resources, Vale and Ultra Clean Holdings are near buy points with earnings due in the coming week. And consumer spending data due Friday could give the market a shot in the arm — if Western countries manage to dismantle Russia’s momentum toward invading Ukraine.

Five Stocks Near Buy Points

Apple (AAPL), Commercial Metals (CMC), Union Pacific (UNP), Oneok (OKE) and Hilton Worldwide (HLT) are five stocks near buy points with relative strength lines at or near highs. Apple has formed a cup-with-handle base with shares slightly below the 50-day line. Commercial Metals and especially Union Pacific are building the right side of shallow consolidations. Oneok has formed a handle in its base. Hilton has pulled back from the buy zone but the entry remains valid amid generally positive headwinds for hotels and travel stocks.

Real Estate, Construction, Home Improvement Supply Chains

Investors will receive a look at home building, remodeling and materials supply chains from multiple angles in the coming week, as Home Depot (HD), Toll Brothers (TOL) and Boise Cascade (BCC) all report earnings. Lowe’s (LOW), Louisiana Pacific (LPX), Cornerstone Building Brands (CNR) and TopBuild (BLD) are also due to report. All are seen turning in strong EPS gains, except for LPX. Most of the stocks are basing, however Boise Cascade is extended, near highs and sitting on a 12-month gain of 73%. CNR broke out this week on takeover news.

Economic Calendar: Just how strong is the consumer?

Investors will get a clearer answer with release of January’s personal income and spending report on Friday at 8:30 a.m. ET.

The past week’s surge in January retail sales — up 3.8% on the month — appeared to show that consumers are shrugging off high prices and that late-year softness mostly reflected a frontloading of holiday shopping to October.

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One question the report will answer is whether retail spending strength was offset by service-spending softness amid the omicron surge. We’ll also learn how much spending grew in real terms, with the report’s latest read on the Fed’s favored inflation gauge, the personal consumption expenditures price index.

Thursday’s initial jobless claims data, released at 8:30 a.m., will carry greater weight in the coming week after the latest report showed new claims unexpectedly rising 23,000 to 248,000 in the week through Feb. 12. It’s easy to overlook one soft week, but another might begin to raise questions about how well the economy is withstanding inflationary pressures.

Security Software: Palo Alto, Zscaler Earnings

Palo Alto Networks (PANW) reports fiscal Q2 earnings after the market close of Feb. 22. Analysts project the cybersecurity firm’s profit will rise 6% to $1.64 per share. Revenue will climb 25% to $1.28 billion, analysts estimate. Palo Alto has been on an acquisition spree. Cybersecurity firm Zscaler (ZS) reports fiscal Q2 earnings after the market close on Feb. 24. Analysts expect EPS of 11 cents, up a penny from a year earlier. Revenue will jump 53% to $241.6 million, analysts estimate.

China Stocks: Alibaba, NetEase, Sohu, Vipshot Report

It’s a big earnings week for China technology stocks, led by e-commerce giant Alibaba Group Holdings (BABA). The reports arrive as China stocks have been hammered this past year, for reasons that include heavy handed actions by government regulators. Alibaba reports before the market open Thursday. The consensus looks for Alibaba to report adjusted earnings of $2.55 per share on revenue of $38.8 billion. That’s a 33% jump in revenue but its slowest growth in eight quarters. Gaming giant NetEase (NTES) also reports early Thursday. The consensus is earnings of $1.02 a share on revenue of $3.8 billion. Gaming company Sohu (SOHU) reports Tuesday morning while e-commerce company Vipshop Holdings (VIPS) reports Wednesday morning.

Biotechs: Moderna, Sage, Pacira Earnings

Moderna (MRNA), Sage Therapeutics (SAGE) and Pacira BioSciences (PCRX) biotech companies are on tap to report fourth-quarter earnings before the open Thursday. Analysts polled by FactSet expect Moderna to earn $9.96 per share on nearly $6.8 billion in sales. Earnings would flip from a year-earlier loss and sales would surge by a quadruple-digit percentage. Sage is expected to report a loss of $2.13 a share, reversing from a year-earlier gain and $1.8 million in sales. Analysts expect Pacira’s earnings to inch up to 90 cents per share on $156 million in sales. Sales would rise 19%.

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SeaWorld Poised For A Breakout

One of the few pure-play routes to the rebounding theme park segment is SeaWorld Entertainment (SEAS). Also in the group, Planet Fitness (PLNT) reports Thursday. Cedar Fair (FUN) reported Feb. 16.

Oil Patch: APA, Diamondback, Matador

More shale oil stocks are on tap with APA Corp. (APA), Williams (WMB) and Black Stone Minerals (BSM) reporting late Monday. Diamondback Energy (FANG), Viper Energy Partners (VNOM) and Matador Resources (MTDR) will report late Tuesday. All three stocks are at or near buy range. Analysts see Diamondback’s earnings soaring 316% to $3.41 per share with revenue doubling. Occidental Petroleum (OXY) will report late Thursday and Northern Oil & Gas (NOG), Calumet Specialty Products Partners (CLMT) and EOG Resources (EOG) will report early Friday. EOG’s EPS is expected to jump 350% with revenue doubling.

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Oil Stocks, Oil Prices Rebound As Russia/ Ukraine News Evolves

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Stock Market Earnings Briefs: Macy’s, Medtronic

Macy’s (M) will report Q4 results before the market opens Tuesday. Analysts see the department store reporting a 150% jump in earnings to $1.99 per share and a 24% rise in sales to $8.44 billion.

Early Tuesday, Medtronic (MDT) will report its fiscal third-quarter earnings. The medical devices player is expected to earn $1.37 per share on $7.88 billion in sales, climbing a respective 6% and 1%.

Telemedicine company Teledoc (TDOC) reports fourth-quarter results late Tuesday. The consensus look for an adjusted loss of 56 cents on revenue of $546.6 million, up 42

Mosaic Still In A Buy Range, Earnings Due

Mosaic (MOS), a supplier of phosphate and potash fertilizer, reports Q4 results after the close on Tuesday. Analysts expect EPS to rise 242% to $1.95 on 55% sales growth to $3.81 billion, according to Zacks. MOS stock, though extended from a cup-with-handle buy point, is still in range of a 43.34 cup buy point on a weekly chart.

Ultra Clean Holdings (UCTT) stock has formed a loose double-bottom base ahead of the semiconductor equipment supplier’s fourth-quarter report, due out Wednesday. Analysts expect its earnings to rise 48% to $1.20 a share while sales climb 64% to $606 million.

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NetApp (NTAP) reports fiscal third-quarter results after the close Wednesday, with the stock up 28% in the past 12 months. Analysts target earnings of $1.28 a share for the data networking company, up 16%, on revenue of $1.6 billion, up 21%. The company is a leading provider of data storage networking-and-management solutions, with on-premise and cloud-based applications.

Heico (HEI) will report Q4 results after the market closes Wednesday. Consensus forecasts see the aerospace parts maker’s earnings climbing 20% to 61 cents per share with revenue up 18% to $494 million.

E-commerce company eBay (EBAY) reports fourth-quarter results late Wednesday, as eBay stock is trading near a 10-month low. The consensus looks for eBay to report earnings of $1 a share on revenue of $2.6 billion, up 9% but its slowest revenue growth in five quarters.

Vale Below a Buy Point Ahead of Earnings

Early Thursday, Papa John’s International (PZZA) should see a 79% EPS increase to 71 cents on a 12% sales gain to $524.1 million.

VMware (VMW) reports Q4 earnings late Thursday. Analysts expect the company, which completed its spinoff from Dell Technologies (DELL) last year, to report profit of $1.97 per share, down 11% from the year-earlier period. Revenue will rise 7% to $3.52 billion, analysts estimate.

Evertec (EVTC) reports Q4 earnings after the market close on Thursday. Analysts estimate 5% profit growth to 62 cents a share for the Latin American payments processor. Revenue is expected to grow 9% to $146.4 million.

Etsy (ETSY) reports fourth-quarter earnings late Thursday, for a company that’s trading far below its record high. Etsy provides an internet platform where artisans and makers of handmade goods can sell their products. The consensus looks for Etsy to post earnings of 79 cents on revenue of $684.6 million, up 11%.

Iron ore mining giant Vale (VALE) reports Q4 results after Thursday’s close. The Brazilian company already reported sales volumes for Q4 and 2022 guidance, with iron ore set to get a solid boost this year. Cost pressures are the biggest unknown. Vale stock has been rallying the past three months and is near a cup-with-handle buy point.

Warren Buffett’s Berkshire Hathaway (BRKB) is likely to see a 30% operating EPS gain to $2.80 on an 11% revenue rebound to $71.459 billion when it reports on Feb. 26.

Early Friday, China EV startup Li Auto (LI) should deliver earnings of 2 cents per ADS, in line with a year ago, as revenue vaults 142% to $1.535 billion

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