Stocks To Watch: Investors Look For Edges Amid Inflation, Rates, Earnings Challenges

Oct. 01, 2022 9:00 AM ETBox, Inc. (BOX), DUK, HAS, ILMN, TLRY, COST, HCP, RGNX, VERU, NCLH, TLRY:CA14 Comments
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Investors hope to turn a page on a brutal September with the calendar turning to October. Looking to next week's highlights, there is a full roster of Federal Reserve Bank speakers, although the general expectation is that the central bankers will reiterate the goal of not pulling back prematurely on restrictive monetary policy and higher interest rates. Meanwhile, the economic calendar is headlined by the September jobs report at the end of the week. For stock pickers, the flurry of investor events include presentations by Sinclair Broadcast Group (SBGI), Illumina (NASDAQ:ILMN), Duke Energy (NYSE:DUK), Hasbro (NASDAQ:HAS) and Box (NYSE:BOX). Also watch for news from Google (GOOGL) with a Pixel hardware event on the calendar.

Earnings spotlight: Tuesday, October 4 - Acuity Brands (AYI) and SMART Global (SGH).

Earnings spotlight: Wednesday, October 5 - Helen of Troy (HELE), Lamb Weston (LW)

Earnings spotlight: Thursday, October 6 - Conagra (CAG), Constellation Brands (STZ), McCormick (MKC), and Levi Strauss (LEVI)

Earnings spotlight: Friday, October 7 - Tilray (NASDAQ:TLRY)

Auto sales preview: TrueCar forecasts total new vehicle industry sales increased 13% in September to 1,140,659 units in September 2022. That tally is up 3% from August 2022 when adjusted for the same number of selling days. Excluding fleet sales, TrueCar expects U.S. retail deliveries of new cars and light trucks to be 987,378 units, up 8% from a year ago and up about 3% from August 2022. "With increasing interest rates, affordability is being tested," noted TrueCar analyst Zack Krelle, Industry Analyst at TrueCar. Honda (HMC), Nissan (OTCPK:NSANY) and General Motors (GM) were noted to have gained traction during the month. GM, in particular, was able to capitalize on other OEMs' inability to deliver vehicles. Deliveries reports are also due in from electric vehicle makers. Tesla (TSLA) is expected to post a big Q3 deliveries number, with estimates ranging to as high as 370K units, which would smash the prior quarterly record of 310K units set in Q1 of 2020 before the pandemic closed down supply chains. The consensus estimate is for Tesla deliveries of about 350K deliveries. Watch for share price movements for Rivian Automotive (RIVN), Li Auto (LI), Nio (NIO), and XPeng (XPEV) as their deliveries reports are digested as well.

U.S. jobs report preview: A key report for Federal Reserve Bank watchers arrives next week with the nonfarm payrolls report for September. Bank of America estimated about 300K jobs were added in the U.S. economy during September to mark a slight slowdown from the 315K in August. The firm said indicators of labor market activity that feed into its projections for payrolls remained red-hot since the August report. "Both initial and continuing jobless claims fell, and the Conference Board’s labor market differential rose by 2pts to 38%, meaning that consumers view jobs as very plentiful," noted BofA's economic team. The takeaway is that momentum in the labor market is proving to be difficult to slow down. Of note, BofA forecast average hourly earnings to rise by 0.3% month-over-month or 5.0% year-over-year to leave wage inflation far too high for the Fed's comfort level.

Corporate events: A busy week of events starts on October 3 with Sinclair Broadcast Group (SBGI) hosting an Investor Day event, Illumina (ILMN) conducting its 2022 Investor Day, and Legend Biotech Corporation (LEGN) holding an in-person and virtual Research & Development Day. On October 4, Duke Energy (DUK) will host a virtual presentation to provide an update on the company's long-term strategy and other business initiatives, American Electric Power Company (AEP) will host an investor event, and Hasbro (HAS) will host its annual investor day event with an update expected on the toy company's Game Plan initiative to drive long-term shareholder value. On October 5, HashiCorp (NASDAQ:HCP) will hold a financial analyst day event and Costco (NASDAQ:COST) will post its September sales report. On October 6, Google (GOOGL) will hold a highly-anticipated Pixel hardware event, Terminix (TMX) shareholders will vote on the deal for the company to be acquired by Rentokil, and Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) will hold an investor & analyst event relating to business and financial results. The week will end with Box (BOX) holding its annual BoxWorks event that will feature a product briefing and talks from top execs. Mark Cuban, IBM (IBM) CEO Arvind Krishna, Zoom Video (ZM) CEO Eric Yuan, HubSpot (HUBS) CEO Yamini Rangan will also give talks. Check out Seeking Alpha's Catalyst Watch for a more detailed breakdown on next week's big events.

Healthcare watch: The healthcare sector has several events worth tracking next week. REGENXBIO's (NASDAQ:RGNX) will hold a conference call on October 3 to provide a new, interim update from the ongoing Phase II AAVIATE trial of RGX-314. On October 6, the FDA Vaccines and Related Biological Products Advisory Committee will take place and the FDA's Pulmonary-Allergy Drugs Advisory Committee will meet to discuss Veru's (NASDAQ:VERU) request for Emergency Use Authorization of sabizabulin for hospitalized COVID-19 patients at high risk for ARDS. Shares of Veru have been volatile before off sabizabulin developments. (Update: The VERU meeting has been rescheduled to November 9).

Eyes on the Metaverse: The MetaBeat 2022 event next week will throw a spotlight on the metaverse. MetaBeat will bring together metaverse thought leaders to give guidance on how metaverse technology will transform the way all industries communicate and do business. Execs from Nvidia (NVDA), Walmart (WMT), Procter & Gamble (PG), Chipotle (CMG), and AI firm Solsten will be at the event.

Barron's mentions: Olaplex Holdings (OLPX) is singled out as an intriguing pick amid the stock market collapse. Of note, OLPX's earnings and sales are expected to rise by more than 20% in 2023. Adding in the hair-care specialist's profitability track, innovation potential, and long-term growth opportunities - OLPX makes its way to the publication's suggested buy list.

Sources: EDGAR, Bloomberg, CNBC, Reuters

This article was written by

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