First Week of June Forecast and Earnings Plays.
Jason Lubin June 1, 2020 3:41 PM
A few interesting tickers for this week
On Tuesday, Zoom Video Communications (ZM) is likely to unveil 1Q EPS of $0.09 vs. $0.001 the prior year on revenue of $199.7M compared to $122.0M last year. The Co is a leader in modern enterprise video communications and since May 22nd, India's Supreme Court has been trying to sort out a petition attempting to ban the company's video conferencing software due to concerns over privacy, according to Bloomberg. Looking at a daily chart, the RSI is above 50. The MACD is above its signal line and positive. The configuration is positive. Moreover, the stock is above its 20 and 50 day MA (respectively at $159.35 and $145.51). We are looking at the final target of $216.00 with a stop-loss set at $153.20.
On Thursday, Broadcom (AVGO) is expected to announce 2Q EPS of $5.14 vs. $5.21 the prior year on revenue of $5.7B compared to $5.5B in the year before. The Co develops a range of semiconductors and on May 28th, HCL Technologies and the Co revealed that they expanded there original partnership signed in 2018, in order to continue to help customers establish a more secure environment to pursue their business growth objectives. From a technical point of view, the RSI is above 50. The MACD is positive and above its signal line. The configuration is positive. Moreover, the stock is above its 20 and 50 day MA (respectively at $269.21 and $249.00). We are looking at the final target of $310.80 with a stop-loss set at $256.20.
Also on Thursday, Ciena (CIEN) is anticipated to release 2Q EPS of $0.49 vs. $0.48 the prior year on revenue of $881.6M compared to $865.0M last year. The Co develops networking systems, software and offers professional services, and on May 19th, the Co disclosed that it was selected by Telefónica UK to move legacy traffic onto a new packet network that is able to support 5G and other next generation applications. From a chartist's point of view, the RSI is trading above 70. This could mean that either the stock is in a lasting uptrend or just overbought and that therefore a correction could shape (look for bearish divergence in this case). The MACD is positive and above its signal line. The configuration is positive. Moreover, the stock is trading above both its 20 and 50 day MA (respectively at $49.17 and $45.07). We are looking at the final target of $62.90 with a stop-loss set at $49.80.
Additionally on Thursday, Gap (GPS) is awaited to post 1Q LPS of $0.48 vs. an EPS of $0.24 the prior year on revenue of $2.4B compared to $3.7B last year. The Co retails apparel, accessories and person-care products under a variety of brands and on May 1st, the Co announced a multiyear partnership with IMG, a professional licensing management company, to help push the Co's brands across new markets and channels of distribution. Technically speaking, the RSI is above 50. The MACD is above its signal line and negative. The MACD must break above its zero level to trigger further gains. Moreover, the stock is above its 20 and 50 day MA (respectively at $7.70 and $7.75). We are looking at the final target of $11.09 with a stop-loss set at $6.25.
Looking at the S&P 500 CFD, the index has been rising on a 30-min chart since May 14th and is using its 200-period moving average as loose support. As long as the S&P can stay above 2995 support we should expect a continuation towards the 3069 and 3105 resistance levels.
Source: GAIN Capital, TradingView
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.