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Tech Stocks' Jul 28 Earnings Roster: FB, PYPL, SHOP, NOW & CTSH

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The Technology sector is expected to have benefited from changing consumer preference and behavior this earnings season. Rapid adoption of cloud computing and the integration of AI and machine learning have been key catalysts.

Technology stocks are riding on continuing work-from-home and online-learning waves that have kept demand for remote-working tech, including advanced technology-based virtual meetings and conference tools, cloud services and cybersecurity solutions, high in the to-be-reported quarter.

The work-and-learn-from-home necessity has propelled demand for PCs, notebooks, peripheral accessories and cloud storage. All of these, in turn, are fueling growth for high-speed Internet services.

Intel’s (INTC - Free Report) second-quarter 2021 results reflected continued PC shipment momentum. Per IDC data, PC shipments in second-quarter 2021 improved 13.2% year over year to 83.6 million units.

Strong results from social-networking companies – Snap and Twitter – reflected strong recovery in ad spending.

Insight Into Key Releases

Investors interested in the technology sector are eagerly awaiting earnings releases from players like Facebook , PayPal (PYPL - Free Report) , Shopify (SHOP - Free Report) , ServiceNow (NOW - Free Report) , and Cognizant (CTSH - Free Report) on Jul 28.

Let’s take a look into how things have been shaping up for these prominent technology companies ahead of their earnings releases:

Facebook’s second-quarter 2021 performance is likely to have gained from improving market share, driven by growing user base and the company’s e-commerce endeavors. Focus on AR and expanding user base in Asia Pacific are expected to have aided the quarterly performance.

Intensifying competition from the likes of Google, Snap and Twitter for ad-dollars is a headwind. (Read More: Facebook to Report Q2 Earnings: What's in the Cards?)

This social-network giant has a Zacks Rank #3 (Hold) and an Earnings ESP of +7.52%. 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 (Strong Buy) stocks here.

The Zacks Consensus Estimate for Facebook’s second-quarter earnings is pegged at $3.04 per share, having been revised 0.3% upward in the past seven days. The figure indicates 69% growth from the figure reported in the year-ago quarter.
 

Facebook, Inc. Price and EPS Surprise

Facebook, Inc. Price and EPS Surprise

Facebook, Inc. price-eps-surprise | Facebook, Inc. Quote

 

Meanwhile, PayPal is expected to have benefited from its robust portfolio, including One Touch and Venmo, in its second-quarter earnings. Strong monetization efforts of Venmo are likely to have aided its adoption rate in the to-be-reported quarter. (Read More: PayPal to Report Q2 Earnings: What's in the Cards?)

However, PayPal has an unfavorable combination of a Zacks Rank #2 and an Earnings ESP of -0.19% that reduces chances of a beat.

The Zacks Consensus Estimate for PayPal’s second-quarter earnings is currently pegged at $1.13 per share, unchanged over the past 30 days and indicating year-over-year growth of 5.6%.
 

PayPal Holdings, Inc. Price and EPS Surprise

PayPal Holdings, Inc. Price and EPS Surprise

PayPal Holdings, Inc. price-eps-surprise | PayPal Holdings, Inc. Quote

 

Shopify is riding on momentum in online shopping triggered by the coronavirus pandemic amid e-commerce boom .Strength in its Shopify Plus platform is expected to have aided its top-line performance in the to-be-reported quarter.

Nevertheless, Shopify’s escalating investments in product development, fulfillment network, infrastructure and international expansion to maintain a competitive edge in the e-commerce market have been headwinds. (Read More: Shopify to Report Q2 Earnings: What's in the Cards?)

Shopify has an unfavorable combination of a Zacks Rank #1 and an Earnings ESP of -13.58% that decreases chances of a beat.

The Zacks Consensus Estimate for Shopify’s second-quarter earnings is currently pegged at 98 cents per share, which indicates year-over-year decline of 6.7%.
 

Shopify Inc. Price and EPS Surprise

Shopify Inc. Price and EPS Surprise

Shopify Inc. price-eps-surprise | Shopify Inc. Quote

 

ServiceNow’s second-quarter results will likely reflect benefits from strong adoption of the company’s workflows by enterprises amid the coronavirus-induced accelerated digital transformation trend.

Nonetheless, higher expenditure on product innovation might have exerted pressure on margins during the quarter under review. (Read More: What’s in the Offing for ServiceNow’sQ2 Earnings?)

ServiceNow has an unfavorable combination of a Zacks Rank #1 and an Earnings ESP of 0.00% that reduces chances of a beat.

The Zacks Consensus Estimate for ServiceNow’s second-quarter earnings is currently pegged at $1.20 per share, unchanged over the past 30 days but indicating year-over-year decline of 2.4%.
 

ServiceNow, Inc. Price and EPS Surprise

ServiceNow, Inc. Price and EPS Surprise

ServiceNow, Inc. price-eps-surprise | ServiceNow, Inc. Quote

 

Cognizant’s quarterly results are likely to reflect its domain expertise in areas like automation, digital engineering, cloud and IoT. Stellar demand for digital transformation across enterprises is anticipated to have fueled growth in the company’s digital bookings.

However, weakness across select global banking accounts is expected to have dampened growth in the financial services segment.

Cognizant has an unfavorable combination of a Zacks Rank #3 and an Earnings ESP of 0.00% that reduces chances of a beat.
 

 

The consensus mark for Cognizant’s’s second-quarter earnings is currently pegged at 96 cents per share, unchanged over the past 30 days and indicating year-over-year growth of 17.1%.

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