2 Earnings Reports to Watch Next Week
It’s only been a couple of weeks but it’s already been one of the wildest earnings seasons in recent memory. Big tech has been all over the map so far with Tesla (NASDAQ: TSLA), Alphabet (NASDAQ: GOOGL), and Microsoft (NASDAQ: MSFT) all popping higher. Meanwhile, Meta Platforms (NASDAQ: META) and Netflix (NASDAQ: NFLX) tumbled despite beating expectations for their respective quarters.
Since big tech is the theme, you probably know what I have my eyes on for next week. Will the market continue higher with the momentum from Alphabet and Microsoft? Or will we succumb to continued strength in commodities and the dollar index which would put more pressure on equities? Let’s see what Amazon and Coinbase have in store next week!
Amazon (NASDAQ: AMZN)
Forgive me for being hyperbolic, but Amazon is one of the most important companies in the world. I know it’s one of the largest by market cap, but I believe an Amazon earnings report gives us a broader view of how the global economy is truly doing. Amazon’s report gives us retail and consumer sentiment as well as corporate spending for AWS and growth in the AI sector. Amazon truly is a conglomerate that reaches across a variety of different sectors.
So when Amazon does well, I tend to take that as a healthier economy. But when Amazon struggles, it’s worth being a little nervous about. Amazon has certainly been a frustrating stock to own and it feels like it’s been in consolidation for years now. To be fair, Amazon’s stock has never had any traction under new CEO Andy Jassy. Can I make a prediction? I think Amazon will do well this quarter on the back of strong AWS numbers and no decline in consumer spending. What will the stock do? Nobody knows for sure.
Coinbase (NASDAQ: COIN)
I could have chosen Apple or Berkshire Hathaway or any other mega-cap company reporting next week. But instead, I’m going to look at Coinbase again because I think this is a sleeping giant of a company. Coinbase has already done well this year and the stock is up by more than 40% despite numerous pullbacks. The stock has been consolidating in a fairly tight range for the better part of the last few weeks and has done well to hold its new area of support which was previous resistance.
Generally, when a stock continues to retest previous resistance as support, it builds a stronger base moving forward. There are fewer reasons for the stock to revisit those levels if it can be established that the resistance has flipped. Coinbase is still quite reliant on Bitcoin and the broader crypto market on a day-to-day basis. So even though the company is doing well, ultimately Coinbase is more influenced by Bitcoin. Coinbase has been expanding its reach in the crypto industry to new markets in Europe and has established headquarters in Canada and abroad. As long as cryptos continue to grow in the mainstream financial markets, Coinbase will succeed and benefit. After a good couple of months of Bitcoin basing in this range, I think both charts are primed for a breakout. I’ll be watching Coinbase next week which should provide a gauge of mainstream crypto sentiment as well.
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