Economic reports in the week ahead - A short trading week is ahead for investors, although it is not likely to be a quiet week with the rapid increase of the omicron COVID variant threatening some industries. The whipsaw action could continue as the impact of the Federal Reserve's plan to raise interest rates is fully digested. A possible wildcard could come earlier in the week from China if the PBOC lowers benchmark lending rates. Nike (NYSE:NKE), Micron Technologies (NASDAQ:MU) and Rite Aid (NYSE:RAD) are the biggest names to report earnings. The IPO market is quiet, but a flurry of SPAC deals go to a vote.
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| | Welcome to the Sunday edition of Wall Street Breakfast, which previews events for investors to watch during the upcoming week. If you want to receive this a day earlier, follow Stocks to Watch and select the option to receive email notifications. Outlook  A short trading week is ahead for investors, although it is not likely to be a quiet week with the rapid increase of the omicron COVID variant threatening some industries. The whipsaw action could continue as the impact of the Federal Reserve's plan to raise interest rates is fully digested. A possible wildcard could come earlier in the week from China if the PBOC lowers benchmark lending rates. Nike (NYSE: NKE), Micron Technologies (NASDAQ: MU) and Rite Aid (NYSE: RAD) are the biggest names to report earnings. The IPO market is quiet, but a flurry of SPAC deals go to a vote. | | Earnings Earnings spotlight: Monday, December 20 - Carnival (NYSE:CCL), Nike (NKE) and Micron (MU).
Earnings spotlight: Tuesday, December 21 - Rite Aid (RAD), General Mills (NYSE:GIS), CalAmp (NASDAQ:CAMP) and BlackBerry (NYSE:BB).
Earnings spotlight: Wednesday, December 22 - CarMax (NYSE:KMX), Cintas (NASDAQ:CTAS) and PayChex (NASDAQ:PAYX).
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Earnings spotlight: Thursday, December 23 - Sanderson Farms (NASDAQ:
SAFM).
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IPOs
IPO watch: No IPOs are expected to debut during the holiday-shortened week. Across the Pacific, Chinese artificial intelligence startup SenseTime Group is expected to debut in Hong Kong. It is a busy week of IPO lockup expirations with Full Truck Alliance (NYSE:
YMM) on December 20, Monte Rosa Therapeutics (NASDAQ:
GLUE) and Doximity (NYSE:
DOCS) on December 21, as well as Elevation Oncology (NASDAQ:
ELEV), Mister Car Wash (NYSE:
MCW), Argo Blockchain (NASDAQ:
ARBK), Elevation Oncology (
ELEV) and Graphite Bio (NASDAQ:
GRPH) on December 22 all standing out.
Dividends
Projected dividend increases: There are not any big dividend announcement expected next week, Looking ahead to the new year, the Dow 30 stocks with the highest dividend yields are IBM (NYSE:
IBM) 5.18%, Dow (NYSE:
DOW) 5.18%, Verizon (NYSE:
VZ) 4.81%, Chevron (NYSE:
CVX) 4.72% and Walgreen Boots Alliance (NASDAQ:
WBA) 3.77%. The S&P 500 Index stocks with the highest dividend yields are AT&T (NYSE:
T) 8.75%, Lumen Technologies (NYSE:
LUMN) 7.94%, Altria (NYSE:
MO) 7.46%, Kinder Morgan (NYSE:
KMI) 6.81% and Williams Companies (NYSE:
WMB) 6.31%.
SPACs
SPAC votes: Votes are scheduled for three SPAC deals on December 21. Shareholders with Altimar Acquisition Corp. II (NYSE:ATMR) vote on the deal to take on-demand digital manufacturing platform Fathom public, shareholders with HealthCor Catalio Acquisition Corp. (NASDAQ:EUSG) vote on the deal to take battery charging player ADS-TEC Energy public and shareholders with portable medical device maker HealthCor Catalio Acquisition Corp. (NASDAQ:HCAQ) meet to vote on the deal with Hyperfine & Liminal Sciences. Notably, HealthCor Catalio Acquisition Corp. has backing from Cathie Wood's ARK Investment. Merida Merger Corp. I (NASDAQ:MCMJ) holds a meeting on extend its deadline to combine with cannabis player Leafly past December 31. Leafly is a subscription-based platform for more than 7,800 brands and 4,600 paying retail subscribers.
Explainer
Nike earnings preview: Nike (
NKE) reports earnings on Monday after the close in a report that will have a sharp focus on demand trends and supply chain progress in Vietnam. Analysts are mixed heading into the report, with warnings on margin pressures from factors like elevated freight costs, container shortages, port congestion and truck/worker shortages weighing on sentiment. Bank of America sees the risk/reward profile on Nike as balanced until there is more visibility on the rebound in China. Meanwhile, Wells Fargo says shares at 36X earnings are at a premium to the pre-COVID multiples and already pricing in NKE's strong underlying fundamentals. On the other hand, Truist initiated coverage on Nike with a Buy rating, while Cowen and Telsey Advisory Group both raised their price targets on the athletic apparel stock on confidence the upcoming guidance will be better than feared.
Healthcare
FDA watch: The FDA action date for Aquestive Therapeutics' (NASDAQ:AQST) NDA on Livervant for epileptic seizures arrives on December 23 and December 24 is the last trading day before the FDA action date on Global Blood Therapeutics' (NASDAQ:GBT) priority review on Oxbryta for sickle cell disease in children. Earlier this week, the company floated a $300M note offering to help fund the development and commercialization of Oxbryta.
Analysis
Box office preview: The U.S. box office could have a huge weekend after Spider-Man: No Way Home brought in the third highest preview gross of all-time. The latest Spider-Man movie from Sony (NYSE:SONY) is on track to be the first pandemic-era movie to top $100 million for a single weekend and could haul in as much as $150 million. Theater chain stocks like AMC Entertainment (NYSE:AMC), Cineworld (OTCPK:CNNWF), Cinemark (NYSE:CNK), IMAX (NYSE:IMAX), Marcus (NYSE:MCS), Reading International (NASDAQ:RDI), Cineplex (OTCPK:CPXGF) and National CineMedia (NASDAQ:NCMI) could benefit if the box office momentum is strong.
Stocks
Barron's mentions: The publication says it expects muted gains for the stock market in the year ahead as corporate earnings and economic growth are expected to decelerate. With the stock and bond markets both priced for perfection, equity investors are advised to focus next year on quality companies that can control their own fate, irrespective of macroeconomic trends. The 2022 outlook from Barron's includes ten picks for investors to consider. Amazon (NASDAQ:AMZN), AT&T (T), Berkshire Hathaway (NYSE:BRK.A),General Motors (NYSE:GM), Hertz Global Holdings (NASDAQ:HTZ), IBM (IBM), Johnson & Johnson (NYSE:JNJ),Nordstrom (NYSE:JWN), Royal Dutch Shell (NYSE:RDS.B) and Visa (NYSE:V) all make the list of best candidates to outperform the market next year.
Sources: EDGAR, Bloomberg, CNBC, Reuters, Renaissance Capital
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