The quarterly earnings season continues this Thursday with two China technology companies. Baidu (BIDU) will update its investors on the progress of its artificial intelligence platform. JD.com (JD), an e-commerce firm, will reveal the impact of severe competition in China.
JD.com competes with Alibaba (BABA) and PDD (PDD). PDD is especially fierce. Temu is an overnight sensational app globally.
Deere (DE) shares failed to break out above $415 over the last year. Investors are bracing for weak agricultural equipment sales in its quarterly report today. Furthermore, weak sales in the construction and forestry equipment sector may hurt DE stock.
Deere needs to increase recurring revenue by selling a subscription-based model. It is serious about incorporating technology in its machinery, connected through Elon Musk’s Starlink.
In retail, Walmart (WMT) had trouble breaking out above $60 since March. The stock trades at a premium valuation. Even if Walmart posts strong results and reaffirms its guidance, the price-to-earnings ratio of 27.05 times is 48% higher than the sector median.
WMT stock suits growth investors, who will willingly pay a premium for its strong profitability and stock momentum. Investors do not get the same stock quality as Dollar General (DG) or Dollar Tree (DLTR). Those two firms rely on discount pricing, whereas Walmart offers online shopping. Its physical stores offer grocery and everyday products. The one-stop-shop model justifies the stock premium.
