Weekly Financial Overview: February 19 - February 25, 2024

This week's financial reports provided insights into various sectors, from retail giants like Walmart to tech behemoth NVIDIA, reflecting diverse performance outcomes and future expectations. The week also witnessed significant movements in major market indexes, hinting at broader economic sentiments.

Corporate Earnings Highlights

Walmart Inc. 

Walmart reported full-year revenue of $648 billion, aligning with forecasts, while its EPS of $5.74 exceeded expectations by 5.6%. Analysts project a modest revenue growth to $668.1 billion by 2025 with EPS expected to rise by 21% to $6.99. Despite the updates, the price target for Walmart shares has increased by 6.3% to $192, indicating optimism about the company's future value.

The Home Depot 

The Home Depot reported a decrease in sales and earnings for Q4 and fiscal year 2023, with sales dropping 2.9% in Q4 to $34.8 billion and annual sales falling 3.0% to $152.7 billion, alongside a net earnings decline of 9.5% for the year. The company announced a 7.7% increase in its quarterly dividend to $2.25 per share and provided fiscal 2024 guidance predicting approximately 1.0% total sales growth, including the impact of an additional operating week. Despite the downturn, The Home Depot remains optimistic about its market share growth in the over $950 billion home improvement sector.

Barclays

Fourth-quarter group revenue dropped 3% to £5.6 billion, with credit impairment charges increasing to £552 million from £498 million the previous year. The Common Equity Tier 1 (CET1) capital ratio slightly decreased to 13.8%, and the full-year return on tangible equity (RoTE) was 10.6%, although fourth-quarter RoTE fell to 5.1% from 8.9% in Q4 2022, with total operating expenses remaining stable at £4 billion.

NVIDIA 

NVIDIA reported a record Q4 revenue of $22.1 billion, up 265% from the previous year, with Data Center revenue at $18.4 billion, marking a 409% increase. The company's full-year revenue surged 126% to $60.9 billion, with GAAP EPS up 586% and Non-GAAP EPS up 288% from last year. CEO Jensen Huang highlighted the tipping point in accelerated computing and generative AI, forecasting significant innovations in the upcoming product cycles.

Rivian 

In 2023, Rivian reported a total revenue of $4,434 million from 50,122 vehicle deliveries, with a reduced net loss of $5,432 million compared to the previous year. Gross profit improved, though still negative at $(2,030) million, alongside a decrease in operating and net losses. The company concluded the year with $10,468 million in total liquidity, indicating a strengthened financial position despite ongoing losses.

Booking Holdings 

Booking Holdings reported quarterly earnings of $32 per share, surpassing the Zacks Consensus Estimate of $29.72 and marking a year-over-year increase from $24.74 per share. The company achieved quarterly revenues of $4.78 billion, exceeding estimates and showing growth from $4.05 billion the previous year. With a consistent record of beating consensus EPS estimates over the last four quarters, Booking Holdings has seen its shares rise by 5.5% since the start of the year, outperforming the S&P 500's gain.

Warner Bros. Discovery 

Warner Bros. Discovery missed revenue and earnings estimates due to a slump in advertising revenue, with a notable 14% decline in linear TV ad revenue and a 4% fall in actual distribution revenue. Despite this, its streaming service Max turned profitable for the first time in 2023, with the company optimistic about its profitability in 2024, although it warned of free cash flow challenges ahead due to increased content spending. The company significantly reduced its net loss to $400 million in the fourth quarter, improving from a $2.1 billion loss the previous year, and saw an 86% increase in free cash flow to $6.16 billion for the year, focusing on boosting cash flow and reducing debt.

Market Index Performance

• S&P 500 closed at 5088.79, marking a weekly change of +1.66%.
• Dow Jones Industrial Average (DJI) ended the week at 39131.54, up by +1.3%.
• NASDAQ 100 concluded at 17937.61, with a +1.42% weekly gain.

Upcoming Earnings Reports 

Several companies are scheduled to report their financial results in the coming week, providing further insights into various sectors of the economy.

• February 26: Workday, ONEOK, Fidelity National Information Services 
• February 27: eBay 
• February 28: Snowflake, Baidu, HP Inc. , Paramount Global 
• February 29: Anheuser-Busch InBev, Dell Technologies 
• March 1: Plug Power