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Blue-chip profits will give investors plenty to digest on Wednesday morning, coming off yet another record high for the Dow Jones Industrial Average the day before.
Dow members Visa Inc. and Boeing Co. are expected to disclose quarterly financial performance before the opening bell. And in both cases, lavish stock gains are on the line – Visa shares have risen by 30 per cent over the past year, while Boeing's stock has nearly doubled in value.
Coca-Cola Co., which is also on the Wednesday morning earnings schedule, has seen its shares rise by 8 per cent over the past 12 months, which, this year, ranks as dismal underperformance.
The Dow is up by nearly 30 per cent since last October. All but five of the index's names have gained over that time, while just one name is down by double-digits – General Electric Co., which missed earnings forecasts by a mile last Friday in the midst of a spotty restructuring and pressure from the oil and gas sector.
Otherwise, recent Dow earnings reports have been strong, with Caterpillar Inc., 3M Co., and United Technologies Corp. all coming in ahead of forecasts on Tuesday.
Those beats lifted the blue-chip index to another record closing value of 23,441.76, up 5 per cent in just one month.
Beyond the Dow, dozens of S&P 500 companies are set to release earnings between Tuesday's closing bell and the start of trading on Wednesday.
Defense contractors will likely be active traders with General Dynamics Corp. and Northrop Grumman Corp. both on the morning earnings docket, as well as Boeing.
Boeing has a strong history of topping the Street's earnings estimates, and following the company's last eight earnings reports, the stock has reacted to the upside six times.
Boeing's management is likely to face questions over its trade spat with Bombardier Inc., which likely played a part in pushing the Canadian plane and train manufacturer into the arms of Airbus in order to salvage the C Series aircraft program.
A strong start to earnings season in general has seen nearly three quarters of companies beat the consensus forecast, with total S&P 500 earnings tracking about 4 per cent higher than expected. If that beat rate continues, it will help boost total earnings growth, which, as of the start of earnings season, was at a fairly modest 4 per cent over the same quarter last year.
Following two straight quarters of double-digit earnings growth, the third quarter was affected in part by a series of deadly and costly summer storms.
Meanwhile, while Canadian earnings season is still in its early days, Canadian National Railway Co. reported a marginal shortfall in its net income versus analyst estimates, while reaffirming its profit outlook for the year as a whole.
Tim Shufelt