Analysis of the Most Interesting Earnings Reports: NVDA, PANW, BJ

Within this analysis we focus on the 3 most interesting stocks that have released the earnings reports in the past week:

  • NVIDIA Corp (NVDA)
  • Palo Alto Networks, Inc. (PANW)
  • BJ’s Wholesale Club Holdings, Inc. (BJ)

The analysis will take into consideration the financial data reported in the earnings report just released (+ data from the last 5 years) and the stock price performance compared to key levels. The explanation of both sections can be found at the end of the article.


Summary

Before going deeper into the individual companies, let’s see together some key data relating to the earnings report released. In particular, the following information is shown in the table:

  • EPS surprise:
    • indicates how much the EPS (Earnings-Per-Share) reported were higher / lower than analysts’ expectations
  • Stock price reaction:
    • indicates the reaction of the stock price on the day of publication of the earnings report
  • Key Data Growth:
    • indicates how much the 3 main items (revenue, net income and net margin) have increased / decreased compared to the same quarter of 12 months before

NVIDIA Corp (NVDA)

NVIDIA Corporation is the worldwide leader in graphics processors and media communications devices. The NVIDIA’ Tesla’ accelerated computing platform gives modern data centers the power to accelerate both artificial intelligence and high-performance computing workloads.

FINANCIALS:

During the last quarter, NVDA reported $3.080 million in revenue, up 38,7% compared to $2.220 million reported in the same quarter 12 months earlier. In the same period, net income increased by 132,7% to $917 million, compared to net income of $394 million in the previous period, while net margin was 29,8% , improved by 67,8% compared to the same quarter 12 months earlier.

Focusing on annual data, NVDA revenue in the last 4 quarters totaled $11.778 million, an increase of 70,4% compared to $6.910 million in revenue reported 3 years ago. During the same period, NVDA reported a 99,2% increase in net income to $3.319 million, compared to $1.666 million net income in the previous period, while the net margin improved by 16,9% .

KEY CHART LEVELS:

As assumed last week, NVDA’s quarterly report confirmed the company’s strength. Since the beginning of 2020 it has grown by 50% and the next objectives are only to reach further historical highs. But beware of probable traces from here to the next few days, before starting again towards new historical highs also thanks to the recovery of the growth in revenue (and the net margin).


Palo Alto Networks, Inc. (PANW)

Palo Alto Networks, Inc. offers a network security platform that allows enterprises, service providers, and government entities to secure their networks. The core of its platform is the Company’s firewall that delivers natively integrated application, user, and content visibility and control through its operating system, hardware, and software architecture. 

FINANCIALS:

During the last quarter, PANW reported $869 million in revenue, up 19,7% compared to $727 million reported in the same quarter 12 months earlier. In the same period, net income decreased by -270,3% to -$75 million, compared to net loss of -$20 million in the previous period, while net margin was -8,6% worsened by -209,5% compared to the same quarter 12 months earlier.

Focusing on annual data, PANW revenue in the last 4 quarters totaled $3.264 million, an increase of 136,8% compared to $1.379 million in revenue reported 3 years ago. During the same period, PANW reported a -18,8% decrease in net income to -$229 million, compared to -$193 million net loss in the previous period, while the net margin improved by 49,8% .

KEY CHART LEVELS:

PANW is 5% away from the strong $ 250.86 resistance. It is difficult to say whether PANW will immediately try to reach it and overcome it, also because the trend started in mid-March 2020 allowed to earn 90% in 2 months, but PANW never took a break.


BJ’s Wholesale Club Holdings, Inc. (BJ)

BJ’s Wholesale Club Holdings, Inc. is an operator of membership warehouse clubs primarily in the Eastern United States. The company operates clubs and BJ’s Gas(R) locations in states. It provides shopping destination which includes exclusive Wellsley Farms(R) and Berkley Jensen(R) brands, along with USDA Choice meats, premium produce and delicious organics.

FINANCIALS:

During the last quarter, BJ reported $3.798 million in revenue, up 20,8% compared to $3.143 million reported in the same quarter 12 months earlier. In the same period, net income increased by 167,3% to $96 million, compared to net income of $36 million in the previous period, while net margin was 2,5% , improved by 121,2% compared to the same quarter 12 months earlier.

Focusing on annual data, BJ revenue in the last 4 quarters totaled $13.845 million, an increase of 12,1% compared to $12.351 million in revenue reported 3 years ago. During the same period, BJ reported a 459,0% increase in net income to $247 million, compared to $44 million net income in the previous period, while the net margin improved by 398,7% .

KEY CHART LEVELS:

In reaction to the earnings report, BJ exceeded the $ 33 it had recorded immediately after a rally started from the day of the IPO of 2018. The following day (Friday) it further accelerated (+ 5.22%). The ability to increase the net margin despite a modest growth in revenues during the last 3 years is remarkable.


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FINANCIAL DATA & KEY CHART LEVELS

– explanation –

FINANCIAL DATA

This section shows some key financial data contained in the company’s income statement, updated to the latest available earnings report. The 2 tables are as follows:

FIRST TABLE – “Key Data in the past 5 years”

“Key Data in the past 5 years” table shows the amount of Revenue, Net Income and Net Margin (the percentage of Revenue that turns into Net Income) reported in the last year or in the last 4 quarters (TTM-trailing 12-months). In the same table you can find the percentage increase (or decrease) of the 3 items in the last 3 years.

To the right of the table you find a chart containing the trend of Revenue in the last 5 years (green columns) and the trend of Net Income (red line) in the same period. Inside the same chart you will find a semi-transparent line that show the trend line of the Revenue in the last years.

This section is useful for understanding if the company has been growing in recent years.

SECOND TABLE – “Key Data in the last Earnings Report”

“Key Data in the last Earnings Report” table shows the data of the same items of the previous table, but with reference to the last earnings report released by the company in comparison with the same quarter of 12 months before.

On the right of the table you will find the relative chart containing the trend of Revenue (green columns) and Net Income (red columns) in the 2 quarters taken into consideration (current versus last year’s quarter).

This section is useful for understanding if the company has grown in the last quarter compared to the same quarter of last year.

Data are expressed in millions of dollars.

KEY CHART LEVELS

For each of the companies, a chart is shown containing the following key chart levels:

  • Simple moving average 50-day (red line) and 200-day (black line)
  • Resistance and Support

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Sources & additional info

*Chart by stockcharts.com
*EPS surprise and company description by barchart.com


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