Weekly Equities Forecast Costco Micron Technologies AutoZone

Costco Q1 earnings preview

Costco will release earnings on September 26 after the closing bell. Thanks to stronger revenues, the stock is expected to report a year-over-year increase in earnings and the share price trades just off its all-time high.

Wall Street is expecting EPS of 5.08 on revenues of 79.93 billion, compared to earnings of 4.86 on 78.94 billion of revenue in the same quarter in 2023.

The wholesale firm has a good track record of being resilient to challenging economic conditions and maintaining consistent performance. More recently, the firm has been ramping up digital capabilities and has delivered double-digit e-commerce sales growth in recent quarters.

Costco recently increased its membership fee by $5, marking the first increase in seven years. The fee hike sparked speculation regarding consumers' reactions; however, the move is expected to strengthen the bottom line without significantly impacting store traffic. This marked the first increase in membership in seven years and is expected to offset rising operational costs.

The Federal Reserve's jumbo rate cut means that conditions for consumers should start easing, brightening the outlook. This comes as data last week showed that consumer confidence was at its highest level in 4 months.

How to trade Costco earnings?

Costco has been steadily rising, forming a series of higher highs and higher lows; buyers will look to extend gains towards 922, the all-time high, and beyond. A fall below 870 could negate the near-term uptrend.

Micron Technology Q4 earnings preview

While many large-cap semiconductor stocks are performing well in the broader market, Micron Technology is underperforming its peers by a wide margin. The stock trades down 44% from its record high above 157 set in June ahead of Q4 and full-year earnings.

Wall Street is expecting an EPS of $1.11 on revenue of $7.64bn.

Me towards the stock and the broader semiconductor sector have taken a hit in recent weeks as investors rotate away from tech as competition heats up and amid geopolitical concerns. The PHLX semiconductor index has fallen 14% from its 2024 closing high.

While Micron’s high bandwidth memory chips are expected to see a demand tailwind from AI some have argued that the expectations are overdone. The stock has recently suffered a slew of analyst downgrades amid concerns over oversupply.

Meanwhile, several analysts have sounded more pessimistic towards Micron technology this month, with BNP Paribas downgrading shares to underperform and slashing its price target. Morgan Stanley has also lowered their price target to $100 from 140.

How to trade MU earnings?

Micro Technologies trades below its falling trendline dating back to mid-June. The 50 SMA is also crossing below its 200 SMA in a death cross signal. Sellers will look to break below 85.00, the September low to extend losses towards 79, the 2024 low. A rise above the 200 SMA at 104.70 could see buyers extend gains.

Autozone Q4 earnings preview

Autozone will release Q4 earnings on September 24 ahead of the opening bell. Wall Street expects to see EPS of $53.33 on revenue of $6.22 billion compared with EPS of $46.46 on revenue of $5.69 billion in the same quarter in 2023.

The share price is up 18% year to date, roughly in line with the broader market, ahead of earnings.

The thriving pre-owned vehicle industry has supported the demand for automobile parts. While interest rates remain high and budgets are tight, people will continue to purchase used vehicles, supporting the demand for car parts.

AutoZone's extensive store network gives it the upper hand over competitors, and the company also benefits from a healthy inventory. While management is cautious in the near term, they expect to see sales growth accelerate over the longer term.

How to trade AZO earnings

Autozone trades in an upward trend on the weekly chart, forming a series of higher highs and higher lows. Buyers will look to retake 3250 for fresh all-time highs. Sellers could look for a break below 2680 the 100 SMA to extend losses.