Key Takeaways:
- Analysts expect Tesla to cut prices further to boost supply in Q4.
- Netflix stock could rise on bullish predictions despite the company’s restrictions on password sharing.
- Further difficulties loom for Goldman Sachs; its stock has lost 7% since Oct 11.
YEREVAN (CoinChapter.com) — Electric vehicle manufacturer Tesla (TSLA), Entertainment giant Netflix (NFLX), and Investment Banking company Goldman Sachs (GS) have seen their stocks slide 6%, 7%, and 2.6%, respectively, since Oct. 11, when the consequences of the Israel-Hamas war hit the markets.
Meanwhile, the Q3 earnings reports on Oct. 17 and 18 could shed more light on where the Q4 expectations should stand. More details below.
#1 Tesla’s Q3 Earnings Could Show Depleting Margins
Tesla investors are concerned about more price cuts needed to boost demand for the electric automaker’s product. The company has already given up a part of its profitability to bolster sales amid growing competition.
Thomas Martin, senior portfolio manager at Tesla shareholder Globalt Investments, asserted that investors could see more pain in Q4. He commented that the price cuts are not over as the “demand is still weak.”
According to nine analysts polled by financial analysis firm Visible Alpha, the Q3 report might reflect a gross margin (a company’s gross profit compared to its revenues) of 18.1%, a 4-year low for Tesla, resulting from cuts of more than 6% across models in the July-September period.
Tesla’s stock TSLA also gave a choppy performance throughout Q3. As mentioned, TSLA lost 6% since Oct 11, opening the Oct 16 session at $253. The upcoming report will shed more light on the Q4 price predictions.
#2 Netflix Q3 Earnings Report Weak?
Researchers from analytical firm FactSet Research Systems expect the video-on-demand service to earn nearly $3.5 a share on sales of $8.5 billion in Q3. Notably, in Q3 2022, Netflix earned $3.1 a share on sales of $7.9 billion.
Moreover, analysts expect Netflix to obtain over 5 million new subscribers, as the company ended Q2 with just over 238 million users.
Rosenblatt Securities analyst Barton Crockett also added that subscriber additions are a key factor for the company since the crackdown on password sharing in the US last quarter. Additionally, the streaming service could get a lot more expensive for customers who want to keep their accounts.
Despite the bullish expectations from FactSet, Netflix stock slid 7% since Oct 11, reaching $362 a share on Oct 16. In detail, the stock price peaked at $485 on July 19, ahead of its Q2 earnings report, but has dropped 25% since.
#3 Goldman Sachs Stock Up
Goldman Sachs will release its Q3 earnings results on Oct 17, before the market opens.
Analysts expect it to reflect a 7% and nearly 33% respective year-over-year decline in revenue and earnings per share (EPS). The banking giant could also report a steep drop in earnings through Q4 as deal-making dries up in the face of a potential credit crunch.
The likely disappointing financial results would follow three-year low Q2 profits. After a booming 2021, the bank’s performance has been subdued since 2022 due to persistent interest rate hikes and growing geopolitical uncertainty that slowed the economy.
As a result, the Goldman Sachs stock (GS) dropped 9% since mid-September and reached $314 on Oct 16.
