The stock market judgment day is only 8 days away

The stock market exploded in 2020, defying all expectations after a truly incredible rebound in the coronavirus bear market in February and March. The rebound was sparked by how quickly some companies shifted gears to adapt to drastic changes in economic and business conditions, as well as investor optimism to look beyond the immediate impact of the pandemic. COVID-19 to predict a better future.

Now 2021 is here, and investors are trying to figure out which direction the stock market will go in the coming year. Bulls eagerly await the rollout of coronavirus vaccines to get the economy back on track, while bears fear that anything that isn’t a full return to normal could disappoint markets. Speculations about what the coming months will look like range from euphoric to apocalyptic.

Earnings reports give investors the truth they need to overcome emotional ups and downs and come to terms with reality. And on Wednesday January 27, the Stock Exchange will really have its day of judgment. On that day, investors will receive three key earnings reports from Apple (NASDAQ: AAPL), Boeing (NYSE: BA), and You’re here (NASDAQ: TSLA) it could explode or plunge the markets.

Take off or hit turbulence?

Boeing will start things on the morning of the 27th. The aerospace giant is expected to release its fourth quarter results before the opening bell Wednesday morning, with a webcast and conference call starting at 10:30 am EST.

From a business standpoint, Boeing was in free fall all year round in 2020. The company initially hoped to fly its 737 MAXs early last year, but it wasn’t until December that Boeing finally got the green light from the Federal Aviation Administration to put the airplane model back in the air. Although the aircraft manufacturer received a large order for Ryanair, a large number of cancellations continued to pour in, in large part because the airline industry remains in shambles due to travel restrictions and reduced demand.

Even before things got better for Boeing, its inventory hit its all-time low. After losing more than 70% of its value in March, Boeing has more than doubled from its worst levels at the end of the year. This left the share price well below where it started in 2020. But the current price reflects a lot of optimism for a company that has suspended its dividend and may continue to see losses persist until 2021.

Investors will be watching closely to see what CEO David Calhoun and his team have to say about Boeing’s outlook for 2021. If they’re not convinced by Calhoun’s strategy, Boeing could experience more turmoil and the stock market. could draw many conclusions about the health of the industry as a whole.

Apple has high hopes for the iPhone 12

Apple has emerged as the world’s largest tech stock, with a market cap of over $ 2 trillion and rising. Yet after another meteoric rise in 2020, many investors fear that even well-deserved praise for the rollout of the 5G-capable iPhone 12 could have pushed Apple stock prices up too quickly.

All signs suggest that Apple’s first quarter tax results, which will come after the closing bell on January 27, should be strong. Overdue orders for the high-end iPhone 12 Pro remain high, even with a four-digit price, and some customers still have to wait several weeks to receive their shipments. This prompted Apple to ramp up production volume in the first half of this year, and vendors have given positive indications that suggest better times ahead. Apple is also seeing service revenue growing at a steady pace, as App Store sales hit record highs during the holiday season.

Nonetheless, Apple’s stock is now trading at over 25 times even the most optimistic forecast earnings estimates for 2022, which would require average annual growth rates of 20% to 25% from fiscal year levels. 2020. It’s not impossible, but it’s ambitious, even with the favorable winds Apple is getting from the product upgrade cycle. Investors will want to hear what CEO Tim Cook and his team have to say at 5 p.m. EST on the 27th.

Does Tesla have something in the tank?

Finally, You’re here (NASDAQ: TSLA) is expected to report earnings after the market closes on January 27. It will follow with a live Q&A webcast starting at 6:30 p.m. EST.

Tesla’s stock rose more than 700% in 2020. That has put the stakes high for the electric automaker to maintain its pace of growth.

Investors already have a good idea of ​​what the fourth quarter looked like. Deliveries of more than 180,500 vehicles brought the total for the year to just under Tesla’s target of 500,000 vehicles. Tesla produced nearly 180,000 vehicles in the fourth quarter and nearly 510,000 for 2020 in total.

Tesla’s revenue report will fill a few spaces, however. Net income and free cash flow will give a better picture of Tesla’s efficiency, as well as the contribution of regulatory credit sales to its bottom line. Shareholders also want to know what CEO Elon Musk’s vehicle delivery target for 2021 is, as well as when to expect new vehicles to be available.

What could hurt Tesla in the future, however, is an extremely optimistic outlook for 2021. Investors have grown accustomed to strong growth in the core automotive sector and also want to see continued progress in key areas such as autonomous driving, battery technology, and sustainable energy equipment, more broadly. If they are disappointed, Tesla’s great race could come to an end.

Don’t miss it

There will be a lot of news on how the market evolves over the next eight days, so it’s not as if nothing will happen by January 27. However, if you have to pick a day this earnings season to pay attention to the market, the last Wednesday in January is the one to watch.