Ford, Mastercard, GrubHub, Harley-Davidson – Stocks To Watch – 4 Stocks To Watch Before The Market Opens Tomorrow
Ford Motor Company (F)
Ford earnings have only started to reflects its status as an icon in American history. After years of struggles, car sales have started to rebound. Low gas prices have been the primary driver of truck and SUV sales. These high margin vehicles typically propel earnings to new territory. Over the past 3 quarters, Ford revenue neared double digit gains while earnings topped 100%. Ford sales have also ramped up in Europe and China which has offset some of the currency headwinds. While all this looks good, Ford has repeatedly warned that Brexit will put a strain on its European operations. Any further indications of this being a problem could send shares spiraling.
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Mastercard Inc (MA)
After strong reports from Visa and American Express, it looks as if it’s smooth sailing for MasterCard. The card giant is coming off a better than expected first quarter that saw double digit gains in gross dollar volume, transaction counts, and worldwide purchase volume when measured on a constant currency basis. MasterCard’s recent string of success has come on the back of consistent international growth and recent acquisitions. Unfortunately a number of alarming points were raised during in the Q1 analyst call and the recent Brexit vote could become a real threat. Similar to Ford, MasterCard investors are hoping the word Brexit isn’t uttered to often tomorrow morning.
Harley-Davidson Inc (HOG)
Harley’s recovery the past year is consistent with the historic rebound in U.S. car sales. In 3 of the past 4 quarters the motorcycle manufacturer has posted a surprise on both the top and bottom line. Harley is moving to increase its customer base, particularly with millennials, by expanding its product portfolio outside of twin cruisers. Harley has indicated that shipments this year would be in the 1 to 3% range with international sales growing much faster than domestic. Just be weary that stiff competition and strong currency headwinds will hurt retail sales moving forward.
GrubHub Inc (GRUB)
GrubHub has been one of the biggest movers with shares up over 60% in the past 6 months. Its business model has been conducive to robust growth due its relatively low operating expenses. At this point both the online and mobile platform have established a competitive advantage against smaller players like Postmates and Uber Eats. In May, the company launched an all encompassing platform which tracks orders in real time. More importantly the company is incorporating mobile payment platforms like Apple Pay to provide its users with more options. GrubHub’s gaudy numbers should be taken with a grain of salt though. Both earnings and revenue growth has greatly decelerated over the past few years, a common theme found in the tech space.
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