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Tech Stocks to Watch for Earnings on May 12: DT, CVLT & EGHT

Aniruddha Ganguly
·5 min read

Technology stocks have so far exhibited resilience this coronavirus-hit earnings season. Solid data center market, growing adoption of cloud-based applications and tech-supported remote-working and online-learning wave are working in favor of the industry players, offsetting supply-chain disruptions and lower advertising spending.

Robust results of tech bellwethers, namely Intel INTC, Microsoft and Google are buoying investors’ confidence.

Intel’s first-quarter 2020 results benefited from strength in its data-centric businesses.  Results of both Microsoft and Google reflected solid demand for their respective cloud-computing services, such as Azure and Google Cloud.

Contactless payment also gained a significant traction amid the coronavirus outbreak. PayPal’s PYPL Venmo, which enables money transfer between family and friends via mobile devices, drove year-over-year growth in total payment volume (TPV). Venmo accounted for more than $31 billion of TPV, surging 48% on a year-over-year basis in first-quarter 2020.

Moreover, expansion in Square’s SQ first-quarter gross payment volume (GPV) reflected a strong performance at the Square Online Store owing to higher transition rate of sellers to online commerce from in-person sales mode post the coronavirus outbreak. Further, increase in GPV generation from eGift Cards was a positive.

Additionally, social-media companies like Facebook, Snap and Twitter registered an uptick in traffic and user engagement as more and more people stayed home due to lockdowns and adherence to shelter-at-home guidelines as well as safe-distancing norms. However, the coronavirus deflated advertising demand and spending, hurting the industry players’ top lines in turn.

Insight Into Key Releases

Here we discuss three stocks scheduled to release their quarterly earnings on May 12.

Dynatrace’s DT fourth-quarter fiscal 2020 results are expected to reflect the coronavirus-induced negativities. Monitoring and digital transformation projects are likely to have suffered delays due to lower spending and budget control, which might reflect on the company’s top line.

Nevertheless, Dynatrace’s firm enterprise footing and a sturdy customer base are key tailwinds. The company’s expertise in hybrid-cloud monitoring is a key catalyst, which is expected to have added customers to its portfolio in the to-be-reported quarter.

Moreover, Dynatrace has the favorable combination of a Zacks Rank #3 (Hold) and an Earnings ESP of +2.13%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 increases the odds of an earnings beat. You can see the complete list of today’s Zacks #1 Rank stocks here.

Notably, the Zacks Consensus Estimate for the company’s earnings in the fiscal fourth quarter has remained at 8 cents per share over the past 30 days.
 

Dynatrace Inc Price and EPS Surprise

Dynatrace Inc Price and EPS Surprise
Dynatrace Inc Price and EPS Surprise

Dynatrace Inc price-eps-surprise | Dynatrace Inc Quote

 

Commvault Systems' CVLT fourth-quarter fiscal 2020 results are expected to reflect healthy recurring revenues and a deepened focus on enterprise.

Notably, in the fiscal third quarter, enterprise software deals (worth more than $100,000) represented 66% of software and product revenues. Revenues from the same improved 15% sequentially.

Moreover, the Hedvig acquisition expanded Commvault’s total addressable market (TAM), which might reflect on its top line despite stiff competition and soft demand due to coronavirus.

Notably, Commvault has an unimpressive combination of a Zacks Rank of 3 and an Earnings ESP of 0.00%.

Further, the consensus mark for earnings in the fiscal fourth quarter has been steady at 39 cents per share over the past 30 days.
 

CommVault Systems Inc Price and EPS Surprise

CommVault Systems Inc Price and EPS Surprise
CommVault Systems Inc Price and EPS Surprise

CommVault Systems Inc price-eps-surprise | CommVault Systems Inc Quote

 

8x8 EGHT is Zacks #3 Ranked and has an Earnings ESP of 0.00%, a combination which dims possibilities of a beat.

The company’s exposure to small and medium businesses (SMBs), most susceptible to the coronavirus-induced economic slump, doesn’t bode well for the top line. Although work-from-home routine is expected to have expanded the customer base, the top-line number is expected to get reflected in stiff competition from the likes of Zoom Video and RingCentral.

Notably, the consensus mark for fourth-quarter fiscal 2020 loss has stayed at 14 cents per share over the past 30 days.

 

8x8 Inc Price and EPS Surprise

8x8 Inc Price and EPS Surprise
8x8 Inc Price and EPS Surprise

8x8 Inc price-eps-surprise | 8x8 Inc Quote

 

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Intel Corporation (INTC) : Free Stock Analysis Report
 
CommVault Systems Inc (CVLT) : Free Stock Analysis Report
 
Dynatrace Inc (DT) : Free Stock Analysis Report
 
8x8 Inc (EGHT) : Free Stock Analysis Report
 
PayPal Holdings Inc (PYPL) : Free Stock Analysis Report
 
Square Inc (SQ) : Free Stock Analysis Report
 
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