So, five of my favorite tech stock companies reported their earnings, and let me tell you – these are some fantastic results. They managed to exceed my expectations, and the numbers are absolutely amazing. Hello everyone, welcome back to Investing with Antoaneta. In today’s post, we’ll have a look at five of the most significant players in the tech field (and my personal favorites), all of which recently released their earnings reports.
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Okay, so who are these mysterious companies that I’m talking about? Well, if I have to be honest with you, I was sort of tempted to use some clickbait-y title like “You will never believe the reports about these companies”, but … it wouldn’t really be fair. Besides, we’re going to look at businesses, known for consistently providing excellent results, so, it would also be pretty silly to say that.
And, I am, of course, talking about, Apple, Microsoft, Facebook, Amazon, and Google.
So, with this blog, I want to hit two major points:
The numbers in their reports and if these stocks are a buy right now. And, of course, the second point is going to entirely my opinion. As I’ve told you before, you should always do your own research and never invest in something, just becomes someone told you to. I am not a professional, and I am certainly not your financial advisor. I’m just like you – I am an investor, looking for opportunities.
We’ll have a look at the opportunities, presented by these five tech stock companies:
Starting off at number one, we’ve got Google.
Google came in at:
- $16.40 earnings per share versus the expected $11.29 (as forecasted by Refinitiv)
- $46.17 billion revenue against the expected $42.90 billion (as forecasted by Refinitiv)
- Google Cloud $3.44 billion versus $3.22 billion (StreetAccount)
- YouTube Ads revenue $5.04 billion vs $4.39 billion (StreetAccount)
- Traffic Acquisition Costs (TAC) – $8.17 billion vs $7.66 billion(StreetAccount)
Is Google a Buy Right Now?
- Market Cap – 1.119 T
- PE Ratio – 32.00
- Forward P/E – 27.25
Now, if you want to see what a gorgeous balance sheet looks like, all you have to do is take a look at Google.
They’ve got over 132 billion dollars in total cash, cash equivalents, and marketable securities, versus … about 14 billion in long-term debt. So, that adds up to over 118 billion dollars in the positive. That is absolutely incredible.
Google is enjoying a rapid EPS expansion. For 2020, the expectation was sitting at 44.39. For 2021, we’re looking at 56.49. That’s really lovely bottom-line growth.
For 2021, analysts are expecting revenue growth of 20.60% from Google. Again – this is a really, really, really solid number for how long the company has been around. Most businesses do not continue growing this rapidly for this long. Google is just that amazing.
Conclusion – If I had to compare Google to the other three companies that we’ve covered, I’d say that they’re the most attractive choice this far. They’re definitely a better buy than Amazon or Apple right now.
Alright, so what about Amazon then? Well, they managed to not only exceed the forecasts but also scored soaring profits and an astounding 37% revenue growth!
So, here are the numbers for Amazon:
- Earnings per share – $12.37 vs $7.41 expected
- Revenue – $96.15 billion vs $82 billion expected
Is Amazon a Buy Right Now?
- Market Cap – 1.533 trillion
- PE Ratio – 89.33
- Forward P/E – 57.14
After this year’s very impressive numbers, Amazon is expected to grow by 18.3% during 2021. I expect them to grow a bit more, maybe say 20-ish percent. They are just on such a roll, that it’s hard to believe any is stopping them. Analysts also expected them to do about $7.40, and they managed to do $12+! And, as far as EPS next year, however, the estimation is a bit iffy in my opinion.
Because remember guys, we are talking about Amazon here. The number can be way more than what’s expected, but it can also be way less. Honestly, there’s no real way of telling how the EPS will go with them. I would be surprised if they had 30 EPS or 60 EPS. It’s just how Amazon rolls.
The forward P/E of 57.14 is also something to be expected here, especially considering the massive growth they pulled this year.
Now, let’s talk about the balance sheet.
They’ve got about a 70billion in cash and cash equivalents and about a 48billion in long-term debt. So, all in all, you’re looking at about 20 billion in the positive. And even if they can’t really hold a candle to Apple or Google in terms of balance sheets, their numbers are still very respectable.
Conclusion – As much as I love Apple, I have to say that, right now, Amazon is a better buy. They might not be an amazing deal, but they’re still a pretty good one.
Now, let’s take a look at Facebook
Zuckerberg’s company managed to exceed our expectations on all accounts, showing us some great numbers:
- Facebook’s earnings came in at $2.71 per share versus $1.91 per share (as forecasted by Refinitiv)
- Their revenue – $21.47 billion vs $19.8 billion (as forecasted by Refinitiv)
- The Daily Active Users (DAUs) – 1.82 billion vs 1.79 billion (forecast by FactSet)
- The Monthly Active Users (MAUs) – 2.74 billion vs 2.7 billion (forecast by FactSet)
- And, finally, their average revenue per user (ARPU) – $7.89 vs 7.32 (forecast by FactSet)
Is Facebook a Buy Right Now?
- Market Cap – 755.651 B
- PE Ratio – 30.22
- Forward P/E – 25.38
Facebook’s balance sheet is really impressive – they are over 60 billion in the positive with virtually no debt to speak of.
Facebook’s estimated earnings per share are expected to rise by about 30% between 2020 and 2021. Their revenue is also expected to grow by over 24%. And that’s super impressive. Facebook is the number one growth tech stock on this list. Not just in terms of the bottom line, but also the top-line as well!
Conclusion – Facebook is definitely one of the most attractive companies on our list and the one I’m the most excited about at this moment. Remember – this can change at any point. I’m not saying that I don’t like the other Amazon, Google, Apple, or Microsoft. I’m not going to sell out of my positions just so I can grab as much Facebook stock or anything like that. But, right now, Facebook is just amazing. And, if they go down in price, I’m going in big time!
Apple did a bit worse in comparison to the first three, but they still managed to beat a couple of the forecasts.
- Earnings per share – 73 cents vs 70 forecasted
- Revenue – $64.7 billion vs 63.70 billion estimated (up 1% year-over-year)
- iPhone revenue -$26.44 billion vs 27.93 billion (down about 20% year-over-year)
- Services revenue – $14.55 billion vs $14.08 billion forecasted (up 16% year-over-year)
- Other product revenue – $7.88 billion vs $7.40 billion forecasted (up 20.9% year-over-year)
Is Apple a Buy Right Now?
- Market Cap – 1.873 trillion
- PE Ratio – 33.59
- Forward P/E – 28.25
I’ve been a big fan of Apple for ages now, and I own a fair bit of Apple stock. If you look at their consolidated balance sheets, they’re up to about $190 billion. Which might seem like a crazy amount at first, especially if you aren’t very familiar with the company. But, here’s the thing about Apple – they also have racked up quite a bit of debt over the last couple of years.
Currently, they’re looking at about 90 billion dollars’ worth of debt. So, while their balance sheet does look pretty solid, and while they could definitely go and clean all of their debt first things tomorrow morning, they’re not going to have all that much left. I mean, $90 billion is still not an insignificant amount for us, but for a company the size of Apple, that’s not really all that impressive, alright?
There’s a big, big difference between just looking at the balance sheet and saying “They up $190 billion!!!” and looking at the bigger picture and realizing “Oh, they’re actually just $90 billion in the plus”. And, please don’t get me wrong here, guys, I’m not trying to be nitpicky just for the sake of it. Remember – I am a big Apple fan myself. But, their numbers do leave a lot to be desired here. It’s just not as impressive as the headlines, the hype, the forums, and YouTubers make it out to be.
But, there are also a lot of good things coming up for Apple. They’re expected to have excellent iPhone sales in 2021, with some forecasts going as far as expecting them to have “the strongest year for iPhone sales ever”. And there is a simple reason for that – there’s a ton of 5G demand and, with 5G iPhones devices unexpectedly affordable, they’re looking at a really bright future. Personally, I believe that they will do even better than what the analysts are expecting here.
Conclusion – I would buy Apple stock if it went down 5% or more tomorrow. I like the company, but I don’t love the stock at the moment. They just aren’t a fantastic deal right now.
- Mac Revenue – $9 billion vs $7.93 billion forecasted (up 28% year-over-year – Big increase here)
- iPad revenue – $6.8 billion vs $6.12 billion forecasted (up 46% year-over-year – big increase here!)
- Gross margin – 38.2% vs 38.1% estimated (up 0.1%)
Is Microsoft a Buy Right Now?
- Market Cap – 1.561 T
- PE Ratio – 33.30
- Forward P/E – 30.77
Microsoft’s revenue is up by a little over 10% from last year (or about 4 billion dollars). Essentially, they managed to make 37 billion dollars by spending a little over 11 billion costs of revenue, amounting to a gross margin of 26 billion.
We’re looking also looking at a net income of 13.89 billion dollars, up from last year’s 10.67 billion.
And, if that’s not impressive, I don’t know what is, really.
So, what does the balance sheet tell us?
Well, they’ve got a total of 137.97 billion worth of cash and cash equivalents versus a 57 billion dollars’ worth of long-term debt. Looking at the company’s overall performance, they could easily clear all of their debt and still have decent numbers going forward.
Conclusion – Microsoft is the one cheapest trading tech stock on our list, yet they still boast really impressive numbers, backed up by a solid balance sheet. Analysts are quite optimistic about their predictions, and, overall, I’d say that Microsoft is a very reliable company. If they dropped by XXXX tomorrow, I would definitely take the opportunity to add more of their stock to my portfolio.
So, in summary: (сложи твоите мнения дали са overvalued/undervalued/reasonably priced etc и на каква цена ще купиш ако паднат тук):
I hope you enjoyed the content, and, if you did, please don’t forget to let me know by hitting that thumbs up button and sharing the blog with your friends. As always, you can feel free to ask any questions about these tech stocks, about business, investing, or success in general in the comments section below. I always love hearing from you, and I will get back to you as soon as possible.
Thank you all for reading, and I’ll see you all in the next blog!
Recommended books for further reading:
- The Financial Times Guide to Investing:The Definitive Companion to Investment and the Financial Markets: The Definitive Companion to Investment and the Financial Markets
- Stock Market Investing For Beginners: The Investment Guide – How to benefit from the crisis, invest in stocks and generate long-term passive income incl. ETF and Stock Picking Checklist
- Intelligent Investor: The Definitive Book on Value Investing – A Book of Practical Counsel
- The Little Book of Common Sense Investing: The Only Way to Guarantee Your Fair Share of Stock Market Returns (Little Books. Big Profits
- The Stock Market Investing Guide #2020: From Beginner to Intelligent Investor within 30 Days – How to Save Money, Generate Passive Income and Reach Financial Freedom
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