Upcoming Earnings to Watch: AEO, COST, ADBE

Stocks were sliding again on Friday morning, with investors seemingly shrugging their shoulders at the latest jobs numbers and continuing to crank up trade war-based selling. This headwind is overshadowing basically all other conversations, including strong reads on earnings and revenue in many sectors.

Wall Street got what it wanted from last weekend's G20 summit, as trade representatives from the U.S. and China agreed to halt new tariffs for 90 days in order to work on a longer-term agreement. But that optimism was quickly erased thanks to discouraging trade-related news, including a series of tweets from President Trump and the arrest of U.S.-backed arrest of Huawei CFO Meng Wanzhou.

The trade war is now, without a doubt, the number one headwind affecting stocks, especially considering last week's surprise dovish turn from the Fed. Sure, folks are worried about a recession on the horizon, but investors are really worried about the trade war sparking a recession much sooner than expected, and that has kept stocks in a bearish range recently.

This makes it difficult for companies reporting earnings during this stretch. Investors need to see powerful beat-and-raised quarters during this non-busy period for reports, and that is no easy task.

With that said, investors should remember to use the Zacks Earnings Calendar to plan out their schedules for earnings, dividend announcements, and other important financial releases. This handy tool is your perfect one-stop-shop to properly prepare for the market events that will have an impact on your own portfolio.

We have made this task even easier today by selecting a few of next week's top reports to preview right now. Let's take a closer look at a few of the earnings announcements due during the week of December 10.

1. American Eagle Outfitters, Inc. (AEO)

Specialty retailer American Eagle is slated to announce its latest quarterly earnings results after the market closes on December 11. AEO had a great run to start the year, but the stock has now lost more than 30% since reaching five-year highs in August. American Eagle will hope to reignite its earlier momentum with an impressive report.

Analysts expect the retailer to report earnings of $0.47 per share, according to our Zacks Consensus Estimate. This would represent year-over-year growth of 27%. American Eagle has seen positive and negative revisions to estimates within the last 30 days, but the overall consensus has not budged. Revenue is projected to be up nearly 8% to $1.04 billion.

2. Costco Wholesale Corporation (COST)

Big-box retail giant Costco is expected to release its most recent quarterly report after the closing bell on December 13. Costco shares have added about 23% so far this year. The company posts monthly sales results and just announced that Q1 same-store sales growth reached 8.8%, crushing expectations. That should serve as an indicator that next week's full report will be largely positive.

Our current Zacks Consensus Estimates are pegged at $1.62 per share for earnings and $34.5 billion for revenue. These results would represent year-over-year growth rates of 19% and 9%, respectively. COST is trading at roughly 30x earnings ahead of the report.

3. Adobe Inc. (ADBE)

Software innovator Adobe will release its earnings report after U.S. markets close on December 13. A darling momentum stock for the past few years, Adobe has pulled back from its highs as investors have ditched high-flying tech picks in recent months. That said, ADBE is still up over 40% in 2018 and could extend those gains with another great report.

Adobe's earnings per share are expected to improve 49% to reach $1.88 for the quarter, based on our Zacks Consensus Estimate. Revenue is estimated to grow nearly 21% to total $2.42 billion. These results would bring full-year earnings and revenue growth to roughly 58% and 23%, respectively.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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