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The following research was contributed by Christine Short, Vice President of Research at Wall Street Horizon.
- With 2023 just around the corner and S&P 500 profit growth in full swing, market participants are turning their attention to quarterly reports and annual shareholder gatherings
- Our team highlights major multinational companies with confirmed incidents
- As shareholder meeting season gets underway, there could be volatility in industries ranging from cars to chips, banks to chocolate
Over the past two years or so, businesses have faced a series of challenges. Following an economic boom fueled by massive fiscal and monetary stimulus in 2021, followed by sharp rises in interest rates throughout 2022, the situation at the macro level last year was grim, with corporate profit growth stalling. But fourth-quarter results underscored the strength of large multinationals in generating cash flow and rewarding shareholders.
According to Factset, the S&P 500 company is now forecasting earnings per share growth for the third consecutive quarter.1 We’ll know more starting this Friday, when the big banks begin reporting first-quarter results.
Now that earnings recession is clearly a thing of the past, investors will also be curious about dividend and buyback plans. Additionally, capital markets may be turning a corner, with some good initial public offerings in recent weeks and M&A activity in some industries showing important signs.
Why shareholder meetings are important
Clues in all of these areas are usually provided at shareholder meetings. At the annual event, shareholders vote on important corporate decisions, such as electing board members (we saw some drama in this last week with Disney ( DIS )), approving mergers and acquisitions, and other corporate initiatives.
Shareholder meetings provide a platform for management teams to hear from equity owners, large and small, while communicating operational plans to the market. However, the party can get tense when activist investors assert their views. Stock price volatility can also intensify when a major strategy shift is unexpectedly announced or surprising financial details are revealed.
surround
April to June is the peak season for shareholder meetings. Let’s take a look at some of the most notable events that can impact individual stocks and drive industry price movements. There was even dessert at the end.
Number of global shareholder meetings by month (2022-2024)
April 16: Strantis (STLA)
The automotive OEM landscape is constantly changing. Tesla reported very weak March electric car sales and a tepid outlook, while Ford (F) reported stronger hybrid sales than a year earlier.2 Investors will likely get a sense of how things develop at Stellantis after a tumultuous second half of 2023 — think back to last year’s labor strike and the eventual agreement between workers and management. Then in March, Stellantis reported it was cutting 400 tech jobs, so things might not be good for the U.S. automaker.3 Looking ahead, rival Ford’s shareholder meeting is scheduled for May 9.
April 22: Broadcom (AVGO)
What drove the market higher last year and early 2023 was the semiconductor sector. AVGO is considered a sibling to NVIDIA (NVDA), but the former’s over 100% return over the past 12 months is hard to ignore among momentum traders. A shareholder meeting of players building artificial intelligence infrastructure could provide more details about the chip industry’s growth trajectory. AVGO’s second-quarter financial results won’t be released until June 12.
April 24: ASML Holdings (ASML)
Continuing on the semiconductor theme, the third-largest non-U.S. stock held its shareholder meeting two days after Broadcom held its shareholder meeting.4 The Dutch company is part of Goldman Sachs’ vaunted “granola” business and a beneficiary of the artificial intelligence boom.5 Earnings per share are expected to grow strongly this year, but the stock trades at a high forward price-to-earnings ratio.6 Any financial updates could impact trends in the stock, as well as the European Equity ETF.
April 24: Bank of America (BAC)
More broadly, Bank of America’s shareholder event comes eight days after its first-quarter earnings report. Chief Executive Brian Moynihan has navigated turbulent financial and capital markets, but BAC’s one-year stock performance pales in comparison to peer JPMorgan Chase & Co.’s (JPM). Be on the lookout for institutional commentary at the event regarding consumer spending and risk appetite. Morgan Stanley analysts said money center banks will benefit from more active capital markets as the year unfolds, but significant uncertainty remains.7
April 30: Citigroup (C)
Citigroup’s shareholder meeting will be held next Tuesday after the release of its first-quarter report on April 12. Chief Executive Jane Fraser has been leading a turnaround at the $120 billion bank, and the stock has responded favorably – up 20% so far this year. Last month, the industry reported an improvement in credit card delinquencies and a decline in net charge-offs.8 At the same time, card issuers are being negatively impacted by new swipe fee agreements that could have a significant impact on revenue.9
May 1: The Coca-Cola Company (KO)
Speaking of consumers, there could be some volatility when KO reports first-quarter results on April 30. The company’s annual general meeting will be held the next day, Wednesday, May 1. The stock has fallen slightly over the past 12 months, no doubt influenced by the growing popularity of the GLP-1 wonder drug. But earlier this year, Coca-Cola raised its dividend by more than 5%, perhaps signaling that the consumer staples stalwart remains a dominant global brand.10 According to reports in February, growth in Latin America, Asia Pacific and Europe, the Middle East and Africa drove revenue up 7% year-on-year.11
May 4: Berkshire Hathaway (BRK.A)
Arguably the most famous shareholder meeting is the one hosted by the Oracle of Omaha. However, Capitalist Woodstock will take on a somber tone on the first Saturday in May. The event follows the death of late Berkshire Hathaway Vice Chairman Charlie Munger. Still, value investors will be looking to hear Buffett’s thoughts on the state of the economy and what Berkshire plans to do with its growing cash position. The first quarter 2024 financial report will also be released at the annual event.
May 6: The Hershey Company (HSY)
Last but not least, this year’s shareholder meeting in Hershey, Pa., will likely draw more attention after cocoa futures surged over the past three months. Last month, cocoa prices rose from $4,000 to over $10,000 a ton, surpassing copper.12 Ironically, HSY stock has been trading between $180 and $205 since October 2023. The Hershey Company’s first-quarter 2024 earnings report has an unconfirmed Thursday, May 2 date.
source:
[1] Earnings Insights, FactSet, John Butters, March 28, 2024, https://advantage.factset.com/
[2] Tesla shares drop 6% on weak auto revenue, warns of slower growth in 2024, CNBC, Lora Kolodny, January 24, 2024, https://www.cnbc.com/
[3] Stellantis to cut 400 engineering, technology jobs, Detroit Free Press, Eric D. Lawrence, March 22, 2024 https://www.freep.com/
[4] iShares MSCI ACWI US ETF, iShares, April 5, 2024, https://www.ishares.com/
[5] 11 GRANOLAS stocks pushing Europe to all-time highs, seven comparisons, CNBC, Elliot Smith, February 27, 2024, https://www.cnbc.com/
[6] ASML ASML Holding NV, Seeking Alpha, April 5, 2024, https://seekingalpha.com/
[7] MS analysts bullish on money center banks, capital markets continue to rebound, Seeking Alpha, Monica L. Correa, March 26, 2024, https://seekingalpha.com/
[8] Credit card delinquencies fall, net charge-offs rise, moderate February pattern, Seeking Alpha, Liz Keische, March 24, 2024, https://seekingalpha.com/
[9] Visa, Mastercard strike $30 billion deal with U.S. retailers, Bloomberg, Paige Smith, March 26, 2024, https://www.bloomberg.com/
[10] The Coca-Cola Company’s Board of Directors Approves 62nd Consecutive Annual Dividend Increase, The Coca-Cola Company, February 15, 2024, https://investors.coca-colacompany.com/
[11] Coca-Cola reports fourth quarter and full-year 2023 results, The Coca-Cola Company, February 13, 2024, https://www.coca-colacompany.com/
[12] Chocolate is more expensive than copper, dr1, April 1, 2024, https://dr1.com/
For more information about the data in this report, please email: info@wallstreethorizon.com
Wall Street Horizon provides institutional traders and investors with the most accurate and comprehensive forward-looking event data. We cover 9,000 companies worldwide and offer more than 40 enterprise event types through a range of delivery options from machine-readable files to API solutions to streaming media sources. By keeping clients informed of important events and revisions affecting markets, our data enables financial professionals to take advantage of or avoid the ensuing volatility.
Christine Short is Vice President of Research at Wall Street Horizon, focusing on research that publishes Wall Street Horizon event data covering 9,000 global stocks on the market. Over the past 15 years in the financial data industry, her research has been widely reported in financial news media, including regular appearances on networks such as CNBC and Fox discussing corporate earnings and the economy.
Twitter: @ChristineLShort
The author may have positions in the securities mentioned.Any views expressed in this article are solely those of the author and do not in any way represent the views or opinions of any other person or entity.
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