The Week Ahead: Earnings Heat Up With Apple, Amazon, and Facebook

The earnings reporting room is crowded with big names this week. Tech giants Apple AAPL, Microsoft MSFT, Amazon.com AMZN, and Facebook FB are set to announce fourth-quarter earnings.

Our analyst expressed a positive outlook for Amazon's late-2019 online grocery efforts. We believe that accelerated adoption of Amazon Fresh supports our longer-term revenue growth assumptions.

Apple announces first quarter earnings Tuesday. Services and wearables like Apple Watch, Airpods, and Apple TV+ are expected to be the largest growth segments. Last quarter, wearables grew by 50% showcasing Apple’s ability to succeed beyond the iPhone.

Microsoft reports fourth-quarter earnings Wednesday. Microsoft Azure, its cloud computing organization, is continuing to compete with Amazon Web Services by increasing integrations and capabilities. The wide-moat firm recently announced its pledge to be carbon-negative by 2030 as corporations face pressure to address the climate crisis.

Facebook is hoping to beat earnings estimates for the ninth consecutive quarter on Wednesday. We will be watching for revenue and user growth across its collection of apps including Instagram, Messenger, and WhatsApp.

From oil, we have Exxon Mobil XOM and Chevron CVX. Payment processors Visa V, Mastercard MA, and PayPal PYPL will report, as will telecoms Verizon VZ and AT&T T. Other names to watch for include Starbucks SBUX, Boeing BA, Eli Lilly LLY, and Pfizer PFE.

Our analysts believe that McDonald's MCD should be on investors' radar; our confidence in the business stems from new technology investments (particularly at the drive-thru), menu innovation plans, a recession-resilient brand, strong cash return qualities, and an underrated management team.

In economic data, we will see a bundle of real estate data, including the S&P CoreLogic Case-Shiller Home Price Index and new home sales numbers for December. The Federal Reserve is set to announce a decision on interest rates Wednesday, but most speculate that it will keep rates steady for this year. Other datasets include consumer confidence, consumer sentiment, and fourth-quarter GDP.