Morgan Stanley (NYSE:MS), International Business Machines Corp. (NYSE:IBM), Halliburton Company (NYSE:HAL) and Hasbro, Inc. (NASDAQ:HAS) will release first quarter earnings on Monday, and are likely to be active in trade. Here what investors can expect:
Morgan Stanley (NYSE:MS)
The consensus of analysts polled by Thomson Reuters is for Q1 earnings of 78 cents a share, compared to 74 cents a year ago. Morgan Stanley hasn’t provided any profit forecasts for the quarter. Revenue should come in at $9.17 billion, up from the $8.93 billion in the same period last year.
Return on equity, a key measure of bank’s profitability, will also be in focus. Morgan Stanley (NYSE:MS) CEO, James Gorman, has set a target of lifting the firm’s ROE to at least 10 percent. 2014 ended with 8 percent, and investors will be hoping he gets there in 2015.
New capital and risk-taking rules have drained profitability from most Wall Street banks. Morgan Stanley (NYSE:MS) had to pull back from some of its trading businesses. The strategy paid off when markets were in a slump. But the sentiment has improved; so has client activity. Investors are eager to know how Morgan Stanley’s rejigged business model fared in better times.
International Business Machines Corp. (NYSE:IBM)
International Business Machines is forecast to record revenues of $19.6 billion for Q1, down 10.5 percent from the year-ago quarter. The company has reported 11 straight quarters of year-over-year decline in revenues. EPS, excluding one-time items, is expected to edge 4.5 percent higher to $2.80, reversing two straight quarters of declines.
International Business Machines Corp. (NYSE:IBM) has been struggling with a marked slowdown in business, largely on account of weak client spending, anemic software demand and divestitures of key businesses. The company has also been hit by exchange rate woes, as IBM derives a large chunk of its revenue from offshore markets. Considering that the business environment is still challenging, revenues across most divisions are more than likely to decline.
However, International Business Machines Corp. (NYSE:IBM)’s power and mainframe systems businesses are on the verge of major product transitions, because of which customers have deferred purchases. The Street will look for news on any new upgrades.
Halliburton Company (NYSE:HAL)
Halliburton Co.’s first quarter earnings per share are seen dropping to 37 cents versus 73 cents in the year ago period. Though the turbulence in the crude oil market began in H2 2014, it didn’t work its way into Halliburton’s earnings last year, As such, Q1 numbers will become an important indicator of the extent to which Halliburton’s earnings will be impacted, going forward, given the current downturn and spending cuts.
Halliburton Company (NYSE:HAL)’s large exposure to the North American market, where a bulk of the cuts are taking place, should keep earnings and revenue depressed for the next few quarters. However, international rig activity should remain resilient over the first quarter.
Hasbro, Inc. (NASDAQ:HAS)
The average analysts’ estimate is for Hasbro to post earnings per share of 9 cents compared to a profit of 14 cents a share in the year ago quarter. The consensus estimate is down from 3 months ago when it stood at 14 cents.
Revenue is likely to decrease 3 percent year-over-year to $660.3 million for the quarter. Hasbro, Inc. (NASDAQ:HAS)’s revenue has increased in each of the last three quarters. For the full year, analysts are expecting earnings of $3.32 per share on revenue of $4.29 billion.
