Earnings Previews: DocuSign, Ideanomics, Kroger
The three major U.S. equity indexes closed lower Tuesday. The Dow Jones industrials ended the day down 0.55%, the S&P 500 dropped by 0.41% and the Nasdaq fell by 0.74%. Seven of 11 sectors ended the day with losses, ranging from 1.2% (communications services) to 0.2% (consumer cyclicals). Real estate (up 1.0%) and utilities (up 0.3%) were the top gainers. Later in the morning, Apple will launch its new iPhone 14, along with other new and improved products. All three major indexes traded slightly lower ahead of Wednesday’s opening bell.
After markets closed Tuesday, Coupa Software beat estimates on both the top and bottom lines and issued earnings per share (EPS) guidance for the current quarter and the full year that was above analyst estimates. Revenue was guided lower than estimates, however. The stock traded up about 11.4% in Wednesday’s premarket session.
UiPath also beat top-line and bottom-line estimates but issued downside revenue guidance for the quarter and the full year. Shares traded down by more than 21% Wednesday morning.
GitLab beat EPS and revenue estimates as well and issued upside guidance for the quarter and the full year. The stock traded up by less than 1%.
Before markets opened Wednesday, Chinese electric vehicle maker Nio reported better than expected profits and revenue but issued downside guidance for the current quarter. Shares traded down about 5.3% in the premarket.
Academy Sports beat estimates on the top and bottom lines. The company raised fiscal-year EPS guidance and guided revenue in line with expectations. The stock traded up more than 6% Wednesday morning.
After markets close Wednesday and before they open again on Thursday, American Eagle Outfitters, Bilibili, FuelCell Energy and GameStop will report quarterly results.
Here is a look at what to expect from three companies reporting results after markets close Thursday or before they open on Friday.
DocuSign
Shares of cloud-based signature and contract management software provider DocuSign Inc. (NASDAQ: DOCU) have dropped by nearly 83% over the past 12 months. The shares posted a new 52-week low on Tuesday, and the 52-week high was set exactly one year ago.
That virtually unbroken slide reflects investor questions about what the company can do to return to its salad days during the pandemic. Revenue growth has stalled, and EPS missed estimates in the prior quarter. Any sign of similar misfortune could cause a stampede for the exits. DocuSign reports its results after markets close on Thursday.
Of 19 brokerages covering the company, five have a Buy or Strong Buy rating and 11 have Hold ratings. At a recent price of around $53.80 a share, the upside potential based on a median price target of $67.50 is about 25.5%. At the high price target of $93.00, the upside potential is 72.9%.
Fiscal second-quarter revenue is forecast at $602.25 million, which would be up 2.3% sequentially and by 17.7% year over year. Adjusted EPS are forecast at $0.42, up 11.5% sequentially but down 10.6% year over year. For the full 2023 fiscal year ending in January, DocuSign is expected to post EPS of $1.69, down nearly 15%, on sales of $2.47 billion, up 17.3%.
DocuSign trades at 31.9 times expected 2023 EPS, 28.6 times estimated 2024 earnings of $1.88 and 23.4 times estimated 2025 earnings of $2.30 per share. The stock’s 52-week range is $53.25 to $311.68. The company does not pay a dividend, and the total shareholder return for the past year is negative 82.7%.
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