Tesla, Meta And SAP Lead Big Earnings Week

Hello everyone and welcome to earnings cheat sheet for Friday, October 16th. It's Rachel Fox here and I'm joined by Ed Carson today and we'll be taking a look at some key upcoming earnings reports to help you prepare for the week ahead. So Ed, there's a lot going on next week. What What are we going to focus on today? >> Yeah, I want to take a look at Meta, Tesla, and SAP. Okay, great. Um, let's go ahead and start with Tesla. Uh, that's going to be a big one. Uh, scheduled to post fiscal Q3 earnings on Wednesday, October 21st. Earnings for the EV maker are projected to fall 9% to 45 cents per share, while revenue is expected to drop 1% to 27.89 billion. And here's why we're watching this stock. It's definitely going to be a key sentiment check for EVs and retail to some extent. Um, but we're also going to be watching for updates on Tesla's uh robo taxi, cyber cab expansion plans, also the economics of the robo taxi, as well as capital expenditures, cash burn expectations. So, Ed, what are you going to be looking out for uh with Tesla next week? Yeah, I mean it's really the reaction to earnings or the reaction to what Elon Musk says because he'll say similar stuff. I mean not saying it's always the same same because sometimes he's more a little bit more optimistic sometimes but still the general thing is hey you know self-driving is where we're going you know optimist is coming you know there's a lot of positive things and it really comes down to how the investors feel about that. I mean honestly because sometimes the market I mean it just feels like wow that was a big reaction it's you don't always know why it was that but last time I think there was like they were a little more cautious while they were spending a lot of money they burned cash for the first time in a while that cash burn is going to continue for a while obviously the market is is expecting better days ahead uh and you know in this report while it's supposed to be down year keep in mind that was tough comparisons versus a year earlier because that's when US tax credits expired So, you know, that was when we had record EV sales and they were able to sell them without too much of a discount given that tax credit. So, you know, the fact that it's not going to drop that much is is sort of a victory for uh Tesla. >> Yeah. And investors might also be looking for hints from Elon Musk about the potential SpaceX merger. Um might maybe we'll get some comments on that as well. >> Yeah, he'll probably be koi. Um but it could excite people. There's a little buzz about that. And there's also Tesla energy. We don't talk about it as much because it's sort of in between. It's a growing business, but not that big compared to auto business. And it's not as exciting as say self-driving or Optimus, but that's important that the sales have, you know, that's the amount has generally trended up, but the margins have come down, which isn't that surprising given that it's somewhat of a commodity product as competition builds up. So, it'll be interesting to see how that one does as well. But again, as almost always, it's always about the future on what people see is going to be down the road for Tesla. >> Yeah. And it does look like going over to Tesla's chart here, looking at market surge, it does look like estimates for 2026 looks like earnings are going to be growing 2% and then for 2027, we're seeing estimates for much larger growth, 34% year-over-year. Uh, which is pretty, you know, that's that's nice. That's good to see. Um >> I would say this is that yeah the estimates tend to be very very optimistic and then throughout the year are cut. This year was a little different. I mean they were cut don't get me wrong. They were expecting these huge gains and then Tesla was really saved and a lot of EV makers were saved by the surging energy gasoline prices. I think that really helped prop up EV sales uh quite a bit and that helped all all of Tesla's rivals in that regard. But you have to take next year's earnings with a grain of salt. I mean with analysts there, they often just slash and slash away as as as the actual time period comes in. >> Yeah, definitely a good thing to note. And uh looking at the actual chart itself, you know, the stock has come under pressure. It's been under the 200 day line for, you know, since early July, so for for a few months. And it's been hitting its head there. Uh but maybe it could get uh support here at the the 50-day line. >> Yeah, I mean look, things are actually lining up because before when it when it got up to say 384 about a month ago, it's like, well, it's popping up above the 50-day line, but it's still well below the 200 day line. It wasn't really a good spot, but you could imagine now. Now, okay, if it gets through short-term highs, it's going to be above the 200 day line. If it decisively clears the 200 day line, it'll have that long trend. I can see that trend line that you've drawn which is now oh it's probably around 397 you know like today and so you know maybe next week it's at 395 I don't know but so if it decisively gets above the 200 day line then you could get it above this trend line which goes all the way back to say December 2025 high really is a good trend line because it hits so many tops if it did that I think that would be an aggressive entry would still be a lot of overhead resistance it's not like a breakout or something high in the base but I I think people could could use that uh so so for the first time in a while there feels like there's something that could look like an entry without either being too low or too high. >> Yeah, I I would agree with that. All right, let's move over to the second stock here, which is SAP. I'm going to pull it up here on our market surge charts. And for this computer software firm, it's expected to report Q3 earnings Wednesday, October 21st after the close. and earnings for the company, which it builds enterprise resource planning and business application software. Earnings are expected to rise 12% to $26 a share, while revenue is projected to climb 9% to 11.45 billion. So, here's why we're we're watching SAP. It's currently in the process, from my research, it's currently in the process of moving thousands of customers away from old software to more modern online subscriptions. Um investors I'm sure will be curious to see you know if there's a lot of future business there and if customers are making that upgrade. Also the company is one that's uh spent heavily in building new artificial intelligence tools into its software. So it'll be important to see if that's really paying off. Um so Ed, what are what are we looking at here with SAP? >> Yeah, this one doesn't have the most amazing growth. I think there's stronger cloud growth of some of the growth areas and so our the growth areas are growing more by definition but you know it's still hard to move that needle. Uh the real thing why it's good to look at this name more than so much is because it's the first one it's the first big software maker to report for the September quarter. I mean so and you know relevant for service now and Salesforce and others that so this sort of sets the tone and whether it's true or not what they have to say will influence you know a lot of other stocks and software is doing pretty well including a lot of SAP's traditional business software rivals. So it's it's that's that's really the reason why is I'm I'm interested more interested in this stock for what it says about for other stocks and the broader sector rather than SAP itself. Uh but uh it's been acting well. >> Yeah. So, a bit of a a bit of a bell weather here. Um setting the tone for what could be to come. Um you know, on the chart, it does look like it's having a really great week. Uh you know, several up days in a row here. It broke out today from this flat base um stage one. Uh maybe it's coming up from from the bottom here. So, you know, the chart doesn't look half bad. >> No, it doesn't. I mean, obviously there's still it's still not near the highs. A lot of other stocks are closer to their highs or even higher in the software group. But this is what we like to see from a bottoming base. Rally off the bottom. So, a prior uptrend, form a base above the 200 day line and then break out. So, this is like a classic bottoming base in that regard. Uh, pretty powerful move. Came off there. So, yeah, acting well. It's in a buy zone right now. Uh, nice bounce off the 50-day line. Well, 10 week line kind of thing. So it's even and it's not even extended from that because it is a pretty shallow base. So looking good the and the RS line if it's not it's not a 52- week high. So we're not going to get a blue there's not a blue dot but it's probably like a six-month high. So yeah, a lot of things going well. The problem is is that earnings are in just a few days. So that really adds the risk. >> Yeah, it it definitely does. Um yeah, Computer Software Enterprise Group ranking six out of 145. as you mentioned, there's going to be a lot of important uh earnings from from many of these companies in the coming weeks. So, this one will be important uh for for that reason. So, all right, let's go ahead and move on to Meta, which is our third key earnings report to be watching out for next week. And Meta is set to report earnings Wednesday, October 21st, after the market closes and is expected to see third quarter earnings rise 544% to $6.76 cents a share. Uh helped by a huge one-off charge from last year, which is important to note. And also revenue is expected to jump 24% to 63.3 billion. And why we're watching Meta is or what we're watching, you know, key things in the report that we'll be looking out for will definitely be Capex. That's always important for this company. Um, we'll also hopefully get some comments from Mark Zuckerberg on Muse's early success, the new AI product. Um, it'll be interesting to see retention metrics and if people are actually paying for the product. Uh, Ed, what are your thoughts on on Meta's report next week? Yeah, I mean exactly like I want to see that it's really surged on this excitement about Muse and just going to find out how is that going to pay off. I mean I think expectations are to pay off but yes the Muse their move into enterprise just in general uh this the vibe has really shifted and we'll talk about the chart in a minute but that's important. This is also the first hyperscaler. This is the first hyperscaler to report. So again, we're going to take the cue. We, you know, right now the market is extremely nervous about AI spending and AI financing. If if Meta says anything suggesting even the tiniest bit negative on AI spending, that could have catastrophic effects or just really double down. positive news could, you know, could continue like, you know, they could come out and say again, no, we're going to boost our spending or we expect, you know, a substantial increase next year or some kind of thing that could could do it. that that really really matters for the broader market and uh and you know what they'll have to say about things uh because there's a lot of their things again it's a little bit like Tesla but a lot of a lot of stuff is about the future growth from Muse and Muse enterprise may you know and enterprise might include a cloud computing arm which which the other hyperscalers do have uh so yeah um definitely an very important stock here >> yeah and looking at the chart as you mentioned it has been rallying a lot in recent weeks um on on Muse and on the the new aspect there. Um this one is, you know, getting above this this short-term level, which I've drawn here on the chart, but let's take a look on a on a daily chart. Um it's kind of been back and forth, but today it's getting support at the at the 21day line here and definitely above key levels. Yeah, I mean look, it would rally when it rallied off the tunity line or even would have been above that 38 686 that you know it just felt like well it's done this before. It had done a number of times it gone over there and so it was hard to buy and as it turned out it was a great time to buy you know but it was you know I stayed away from it because it's like well I I didn't like this really ugly chart. I mean it was like this big choppy moves. there seems to be a shift that now AI is going to pay off for for Meta because they really did not seem to have they weren't in the lead. I mean it was Google, it was open AI, it was Anthropic. Uh other things were going on. Amazon had its cool chip. You know, it's like Meta didn't seem to have anything. I mean, that's not fair, but you know, it just didn't in terms of AI. Uh so now it's setting up. So now, okay, if you missed it, now it's pausing. To me, I see this as sort of a messy handle. It doesn't look that messy compared to how messy the base is. Uh, I like the support it's found at the 21-day line. I mean, presumably if this doesn't move out on earnings, which, you know, who knows? But this one could form a base sort of within that consolidation, you know, in a couple more weeks, but that's a ways away. But still, I think that this is a handle. You could use the high from this week as sort of an early entry to that handle. As you say, it's all right around forming around that one other short-term high that, you know, you got that line that you drew through it. But yeah, this seems like a nice place. It's, you know, if it consolidates and it does move out, that would be something that would uh, you know, it be suggest it has another move in it. >> Yeah. All right. Let's go ahead and do some lightning round here and take a look at some of uh, the other tickers that we'll be reporting next week. Uh, starting with VLOO, which is going to be reporting uh, third quarter earnings October 22nd. Uh, in the oil and gas space, high ranking group right now. Uh, this one's really taken off. It's been doing great. Now the thing is is that earnings probably won't matter. Look at this. This is stock that has made these huge moves. But look at actual earnings report days around the stock doesn't move that much and this opposite is the case with oil stocks like oil you know like with oil production and refining stocks because okay they you know it's not that hard to calculate sort of what they paid for oil and what they probably got for their gasoline and diesel. So it's I mean with a lot of these reports it's you know the earnings and the earnings reports the earnings are going to be great. I mean, but it's just the earnings days are often not that exciting. And I probably would have highlighted this as one of the big three because obviously it's one of the big winners. The problem is that it's extended and earnings earnings often don't move things. I think people should be looking for maybe a pullback to the 21day line again or or some kind of thing or even just a full-on base. uh you know but just hard to know with all the stuff going on in Iran with Russia, Ukraine, there's a lot of things that could make uh the underlying dynamic you know continue to be strong or deteriorate pretty quickly. >> Yeah, it is very sensitive to geopolitics of the moment. So, uh but definitely a strong one and one to watch. Um let's take a look at LRCX which has earnings due uh October 21st, third quarter earnings. uh a chip stock. This one crossing below its 200 day line today for the first time in gez, I don't even know how long. It's been it's been a while. It's been a few years, but um yeah, there's been pressure in this area over the past uh several weeks. >> Yeah, this is all reflective of what's going on in the chip sector and everything else, but that's the way it is. This is why we talk about follow the market, follow the sectors, you know, uh yeah, we want to see signs that demand is there. This stock presumably will not be actionable anytime soon. I'd be nervous if it gapped up to say 370. I mean, that'd be a huge move. I mean, you know, so uh but you need to hear positive comments from these names like yes, we're seeing strong demand. We see it, you know, we're sold out through 2028. Those kind of things. Uh you know, to regain confidence in the broader sector, but I don't think this one is something that people will be looking to buy in the short term. you know, I didn't hear you because you were on mute, but yeah, this is like uh it's getting close to those lows, but I think I can understand what's going on. Like it was getting close to these uh base lows. Yeah. So, there's there look, it's close to decisive breaks. I think that people I mean, I'm not sure if people bought if people bought at 345 or 352, they should have been out by this point anyway. And if they were longer term holders, you know, I mean, obviously the 200 day line's big, but you know, if you held for all that, you maybe you're sticking in for something longer. But, uh, I think if it drops further from here and yeah, undercut those levels, I think long-term holders would want to be getting, you know, you know, maybe scaling out. >> Yeah, I couldn't have said it better. All right, let's move over to TXN, uh, Texas Instruments, which is reporting next week on October 21st. Uh this one has been basing here for a few months now. Uh definitely has a buy point but pulling back to the 50-day line. >> I mean this one is like some of the analog chip makers are doing pretty well. You can see that the revenue growth has accelerated expected to accelerate again. So these were sort of slower growth areas but it became sort of an AI chip area. So we'll see. This has held up better than a lot of names. I can imagine a gap up off the 50-day line uh breaking the downtrend of this too low handle or even getting above the 300 level. That could be actionable. >> Yeah. All right. And let's go ahead and check out MXL, which is another one reporting next week. Uh earnings are due October 22nd. Uh we will wait for this chart to load. And my internet is struggling. And you've been somewhat frozen here. >> Okay. Yeah, it's telling me I've been having an internet problem. Um, let's see if this loads. Oh yeah. Okay. Yeah, I'm having an internet issue. Sorry. Just give me one second. Okay. Wait, there it is. Can you hear me? >> Yes, I can hear you. Yeah. >> Okay, cool. Then we will just continue on. All right. MXL earnings due October 22nd. Um, this one also a chip name reporting next week. Uh, also undercutting a key level of support here after a difficult few days, undercutting the 50-day line, but it looks like um it's hard some of the losses today. >> Yeah, I mean the thing is this has just fallen so fast and this is when things get in a downdraft, you really have to watch out for those higher ATR stocks. Texas Instruments had not that we need to go to that has an ATR of just under 3%. This one has 8.75%. So I mean you know so you really have to watch it. Uh it's it's it's risky enough in good markets but when the sector turns weak this is really fallen off. This has fallen 42% off it 52 week high and most of that is really the last couple weeks. I mean I haven't done the math but I can imagine that's about you know 25 30% in just a few days. So needs repair work. Yes it could bounce back. Growth has been very strong. Uh it's supposed to be acc accelerating revenue growth again. Uh so one to watch but again like so many others it's gone beyond the point where one good day would make you feel good about this. It needs some repair time it seems like. >> Yeah definitely and yeah as you mentioned very high uh 21day ATR stock as well at 8.75%. So a tricky one to be doing anything with. Um, all right. Let's go ahead and take a look at uh RNG, which is another or Ring Central, which is another uh one from the computer software enterprise industry group. Strong ranking group. Uh the chart looks pretty decent. It's holding up trading tightly above the 21day line. >> Yeah, it's possible this one will have a three weeks tight heading into earnings. I mean, it's sort of working on that. uh you know right now it is a 3 weeks tight I believe or would be if it got through but we'll see what you know coming week but I think people could use use that move over this week's high or or the or the ultimate high as as an entry I mean that would be somewhat risky in this market uh again there's just so many crosscurrens multi-trillion dollar bets that are should they continue or not which is ring you know I that you just don't know how various sectors will react just in general but ring is one with steady growth not amazing growth I wish the revenue the new growth were a little stronger. I think, you know, I think there's been optimism about an AI shift and stuff. Well, how is that going to pay off, you know, a little bit down the road and really see the growth pick up or not? And and then how much more is should should this one be moving off of that? >> All right, let's move over to Steel Dynamics, STLD, which is earnings due uh Monday, October 19th. Uh it looks like estimates are for uh 100% year-over-year growth. So, a nice acceleration from the prior quarter here. Um, and nice 2026 annual estimates as well. Uh, this one coming into support at the 21day line. >> Yeah, big moves recently like I think a strong move over 250 could offer an entry. Uh, we'll see. I mean, we'll see how that goes. There's uh um there's this concerns that the tariffs have made steel so expensive that customers can't afford it. But yeah, sort of like the downtrend line and the and that short-term horizontal line sort of line up. So, you know, that would be something that could be a possibility there. Again, there's just different things going on. Uh and you you know, it hasn't made a big move recently despite the strong earnings. Uh but, uh this could be a place uh that could that could go on another run again. >> Yeah. All right, let's check out a stock in the medical sector, which is an area that has been uh pretty strong. This is an industry group ranking four out of 145. So, medical research uh really strong there. Earnings a year-over-year growth uh not quite as strong. We're seeing a bit of a deceleration expected here for the upcoming quarter. Um and it's been basing here in this consolidation. >> Yeah, this is a weird one. This is a stock that has a low ATR except on earnings. That ATR looks at 3%. Oh, this is nice. This is like Pirates of the Caribbean, but every once in a while you get a real rapids kind of situation, you know, like that. Oh my goodness. Uh you just can scroll back. This is when if you go to a weekly, this is the kind of thing you can see their earnings reports from space. You know exactly where this company has reported. I mean, just enormous moves up and down. So, I would be extremely wary of buying this ahead of earnings uh unless you did an options play. I mean, and they were willing to to lose all that because you could win 20% in a day and just okay or you lose it all. Uh, but yeah, just uh the growth is supposed to slow a little bit here. It's it's slowing, you know, in in this quarter and then maybe more. So, you might want to check on that. But this has been basing for a while fairly tight again heading into earnings. Uh, so it could be interesting. The problem is it's hard to know when to buy it because it's like if you can't buy it before earnings and then does all of its move on earnings and doesn't move, it's just hard. It's just hard because where do you buy it? Because then it goes sideways, you know, often for the next few months. So, it's been a tricky one to find a place to actually buy even though the trend over the past year has been up a lot. Uh so, but uh an interesting name and sure almost sure to get a big move on earnings. I just have no idea which way it'll be. >> That's impressive. The consistency with which it just completely jumps on earnings is wow. That's >> got to know the character of a stock. I mean, yeah, some stocks like VLOO, they don't move on earnings and some stocks they go like crazy. So, that's something everybody should know. Oh, generally, okay, I like to have this kind of cushion. But with something like Medpace, you probably want a bigger cushion because it moves so much. >> Yeah, knowing the character of your stock is very important. All right, let's move on to our final ticker here, which is uh Appfolio. This one is expected to report earnings October 22nd. And on a on a daily chart, we can see it's had a really strong day today, up over 7% uh for, you know, a somewhat lower ATR stock. Um getting back above the 50-day line here. >> Yeah, this one is tied to the does real estate software. So, I'm assuming that a big reason why this is popping because some of the software names on this particular day that are rising are tied to employment or tied to real estate. You know, the interest rates are probably a factor. So if treasury yields rebound while other software makers might be like I don't care that much it could have a big impact on this. So definitely should be should be aware of that. I mean again if yields fall and all of a sudden you start just seeing housing and you know like that that sector picking up again this might do quite well. Um it does have a bit of a you know like a decent growth out there. Uh so one to watch, but again that that's sort of a an X factor out there and and and unfortunately it looks viable today, but earnings are coming up, so who knows where it'll be in a in a week uh when when when actual earnings come out. >> Yeah, exactly. Definitely wait on this one. Um but yeah, keep it on a watch list. This move today is definitely impressive. All right, that is going to wrap it up for this episode of Earnings Cheat Sheet. Thank you, Ed, so much for all of your comments and analysis here. If you want even more market analysis, be sure to tune in to Stock Market Today that goes live after the closing bell. Thank you so much for watching and we'll see you again here next week.