S&P 500 stocks Adobe, Costco Wholesale, Fair Isaac, SLB and UnitedHealth Group are in focus this week.
The Dow Jones Industrial Average, the S&P 500 and the Nasdaq composite fell sharply last week as the 10-year Treasury yield surged yet again. Meanwhile, a slew of earnings reports are about to hit the market. So far, the reaction to earnings and guidance has been negative overall.
So stocks without earnings in the short run are a plus.
SLB and UnitedHealth recently reported, with Adobe and Costco several weeks away. Even Fair Isaac is over two weeks away.
These five S&P 500 stocks are trading around buy points.
S&P 500: Adobe Stock
Adobe stock fell 2.7% to 540.96 in Friday's market action, but found support above the 50-day line, closing above the 21-day. On the week, the S&P 500 stock dropped 1.4%.
Adobe shares have formed a flat base with a buy point of 570.24, according to MarketSmith. In a positive sign, the relative strength line for Adobe stock is rising as it outperforms the broader S&P 500 index.
Meanwhile, Adobe's earnings-per-share growth has accelerated in the last two quarters.
The S&P 500 component recently announced more than 100 new generative AI features and updates for its creative software. The software giant added three new image generators to its Firefly family of products. It also released scores of AI features and updates across its Creative Cloud applications, including Adobe Illustrator, Photoshop, Lightroom, Premiere Pro, After Effects and Adobe Stock.
Adobe unveiled the new features at its annual Max conference in Los Angeles, drawing upbeat reactions from many Wall Street analysts.
The S&P 500 stock ranks first in IBD's Computer Software-Desktop industry group. Adobe stock has a 98 Composite Rating out of 99. The stock has a 97 Relative Strength Rating, an exclusive gauge for share-price movement. The EPS Rating for the S&P 500 component is also 97.
Further, ADBE stock is on three IBD lists: the IBD 50, Big Cap 20 and Tech Leaders. Adobe stock was Wednesday's IBD Stock Of The Day.
SLB Stock
SLB sank 2.9% to 58.21 on Friday after it reported third-quarter earnings, back below the 50-day line. On the week, SLB stock fell 1.3%.
SLB stock has a short flat base with a 62.12 buy point. Wednesday's high of 61.20 could be used as an early entry for aggressive investors.
SLB reported better-than-expected third-quarter profit Friday as the company sounded optimistic about its international operations growth even as the Middle East's Israel-Hamas war clouds the oil market outlook.
SLB announced earnings grew 24% to 78 cents per share while revenue increased 11% to $8.31 billion, with both growth rates slowing for a second straight quarter. Analysts predicted EPS of 77 cents per share with sales of $8.32 billion.
The vast majority of SLB's sales came from its international work. SLB's international revenue grew 12% to $6.61 billion while its North America segment totaled $1.64 billion, up 6% vs. last year but down 6% compared to last quarter.
SLB Chief Executive Olivier Le Peuch in the earnings statement Friday said the company's Q3 performance was propelled by "broad-based growth" across Saudi Arabia, the United Arab Emirates, Kuwait, Oman, Indonesia, China and Malaysia.
Despite the war in the Middle East, Le Peuch said "market fundamentals remain very compelling for our business" and he expects sequential revenue growth in the fourth quarter.
IBD ranks SLB stock fifth in the Oil & Gas-Field Services industry group, behind Halliburton. S&P 500 stock HAL has a 99 Composite Rating out of 99. SLB stock has an 89 Relative Strength Rating. The EPS Rating for the S&P 500 component is 86.
S&P 500: FICO Stock
FICO dipped 0.8% to 912 on Friday, but rose 1.9% for the week. Fair Isaac has a flat base with an official entry of 916.41, according to MarketSmith.
The stock has gained 52% in 2023, including 4% in October. During effectively all of that run, the S&P 500 stock has been cradled by its 10-week moving average. FICO stock's relative strength line is also at new highs. FICO was Tuesday's IBD Stock Of The Day.
Montana-based FICO is a data analytics company, best known for its FICO score — a measure of consumer credit risk that is used by consumer lenders in the U.S. The company's two operating segments are "scores" and "software."
Analysts see earnings for the S&P 500 giant growing 20% in Q4 to $5.29 per share with revenue increasing 11% to $389 million. For the full fiscal year, Wall Street predicts EPS gaining 16% to $19.99 and sales jumping 11% to $1.52 billion.
Analysts also forecast solid EPS growth over the next four fiscal years, with earnings expected to reach $40.70 per share in 2027, according to FactSet.
Fair Isaac reports fiscal fourth-quarter earnings on Nov. 8.
FICO stock has a 97 Composite Rating out of a best-possible 99. The S&P 500 component also has a 97 Relative Strength Rating and a 96 EPS Rating.
UnitedHealth Stock
UNH shares edged down 0.9% to 527.03 Friday. UnitedHealth stock shed 2.3%% on the week.
UNH now has a 546.78 handle buy point from a 50-week consolidation.
UNH is part of IBD's Long-Term Leaders list and is ranked No. 1 by IBD in the Medical-Managed Care group, according to IBD Stock Checkup.
Last week, the Dow Jones component kicked off the Q3 results for the managed-care industry, easily topping estimates and slightly raising the low end of 2023 earnings guidance.
UnitedHealth's adjusted earnings rose 13.3% vs. a year earlier to $6.56 per share, ending a three-quarter string of slowing growth. Revenue climbed 14.2% to $92.36 billion.
UNH raised full-year 2023 EPS guidance to a range of $24.85-$25 from $24.70-$25. The analyst EPS consensus is $24.83, according to FactSet.
S&P 500: Costco Stock
Costco stock fell 2.25% to 552.93 on Friday, losing 2.45% for the week. Shares pulled back below the 571.16 buy point from a flat base, ending the week below the 50-day line.
Back in September, the S&P 500 component reported full-fiscal year and fourth-quarter results amid a wider downturn for retailers and mixed performance for discounters.
Costco earnings growth slowed after two quarters of accelerating gains. Adjusted earnings climbed nearly 16% to $4.86 per share adjusted, compared to an 18% gain the prior quarter. Total revenue grew 9.5% to $78.94 billion, ending a streak of decelerating growth for the past four quarters.
Fiscal 2023 earnings rose 7.9% to $14.16 per share on 6.8% revenue growth to $242.29 billion. Full-year adjusted comparable sales climbed 5.2%. Costco's U.S. comparable sales rose 4.2% for the year. E-commerce sales fell 4.8% in 2023.
Meanwhile, increasing the price of Costco memberships is "a question of when, not if," CFO Richard Galanti said in September. The company last increased its membership fees in June 2017.
This past week, Costco announced that CEO Craig Jelinek will step down Jan. 1 COO Ron Vachris will take over as chief executive
The S&P 500 stock has an 89 Composite Rating out of 99. COST shares have an 88 Relative Strength Rating. The EPS Rating for the S&P 500 component is 95.
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