This Week's Earnings Repertoire

Despite another volatile week, both the Dow Jones Industrial Average and the S&P 500 index ended Friday's trading session at all-time highs, underscoring the level of optimism investors still have about the strength of the economic recovery. Although earnings reports remain in a lull, several big-shot names will present their latest financials this week, including Nike NKE, Coupa Software COUP, CrowdStrike CRWD and FedEx Corporation FDX.

Coupa Software needs to outline its path towards becoming a BSM leader

On Tuesday, Coupa Software is expected to lose 11 cents per share on revenue of $145.66 million. Coupa, a provider of a cloud-based corporate spend management software aiming to become a Business Spend Management leader, saw its shares fall 21% over the past month. Coupa makes money by analyzing large quantities of corporate transactional expense data, looking for spending patterns and areas of inefficiency to provide actionable insights that consumers can use to improve inventory management, make smarter purchasing decisions and lower expenditures. Its total addressable market is measured at $56 billion and growing.

CrowdStrike needs to show it will stay relevant

Also on Tuesday, FactSet expects CrowdStrike to earn 8 cents per share on revenue of $250.44 million. As vaccines become more widely available the market has grown concerned about software stocks, including cybersecurity stocks like CrowdStrike which has surged as much as 380% over the past year. Although there are valuation concerns, it's hard to imagine a scenario where cybersecurity won't be a critical part of enterprise spending in a post-pandemic world. Companies will continue adopting digitalization and therefore, improving security will be a top operational priority. Currently worth $200 billion, the market is projected to grow to approximately a 10% compound annual growth rate within the decade.

Nike is expected to capitalize on its brand name and innovation

On Thursday, Nike is expected to report adjusted net income of $1.2 billion, or 76 cents a share, on sales of $11 billion according to FactSet. The stock has risen 2.9% since the company last reported earnings on December 18^th. Nike has positioned itself as one of the better-performing names within the retail sector with its shares going up some 70% over the past year, despite the devastation brought on by the pandemic. Although some argue that shares have run too far ahead of the company's fundamentals, Nike has capitalized from the fact that consumers across the globe have developed an increased focus on health and wellness by being known for its strong brand name and innovation.

FedEx

Thursday is the day for FedEx Corporation which is expected to report adjusted net income of $858.2 million, or $3.31 a share, on sales of $19.9 billion. The stock was fueled by stronger-than-expected business activity, particularly in its domestic parcel capacity, increasing 140% over the past year. Investors now want to know what the company can do to sustain the momentum. Last quarter revenue for the Express segment, the company's largest operation, grew more modestly than the Ground and Services business. But there are now signs of a recovery in air cargo demand which should help relieve some of the pressure, along with mass distribution of vaccines and the re-opening of the economy.

As vaccine rollouts accelerate and the economy prepares for re-opening, here is plenty of reason to suggest that the worst of the pandemic is behind us. The question remains, while the economic recovery has demonstrated resiliency, what will the new market normalcy look like?

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