Communication Services Sector In Focus As Investors Gear Up For Alphabet Meta Earnings

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Communication Services sector in focus as investors gear up for Alphabet, Meta earnings
Communication Services sector in focus as investors gear up for Alphabet, Meta earnings from

Communication Services sector in focus as investors gear up for Alphabet, Meta earnings

Alphabet, Meta Platforms earnings on tap this week as investors brace for impact of macroeconomic headwinds

The Communication Services sector is in focus this week as investors gear up for earnings from two of the sector's largest companies, Alphabet and Meta Platforms. Both companies are expected to report their latest quarterly results after the bell on Wednesday, and investors will be closely watching for any signs of impact from the current macroeconomic headwinds.

The Communication Services sector has been one of the worst-performing sectors in the S&P 500 this year, with the SPDR Communication Services Select Sector ETF (XLC) down over 20% year-to-date. The sector has been weighed down by a number of factors, including concerns about the impact of inflation on consumer spending, rising interest rates, and the war in Ukraine.

Alphabet, Meta earnings: What to expect?

Analysts expect Alphabet to report revenue of $70.6 billion and earnings per share (EPS) of $1.32 for the third quarter. This would represent a modest increase from the same period last year, when the company reported revenue of $65.1 billion and EPS of $1.27.

Meta Platforms is expected to report revenue of $29.1 billion and EPS of $2.84 for the third quarter. This would represent a slight decrease from the same period last year, when the company reported revenue of $29.1 billion and EPS of $3.22.

Key themes to watch for

Investors will be closely watching both Alphabet and Meta's earnings reports for any signs of impact from the current macroeconomic headwinds. Key themes to watch for include:

  • The impact of inflation on consumer spending: Inflation has been a major concern for consumers in recent months, and it is likely to have weighed on the advertising revenues of both Alphabet and Meta.
  • The impact of rising interest rates: Rising interest rates have made it more expensive for companies to borrow money, and this could lead to lower spending on advertising.
  • The impact of the war in Ukraine: The war in Ukraine has created uncertainty in the global economy, and this could lead to lower advertising spending from businesses.

    • What to do with Alphabet, Meta stock

    Analysts are mixed on the outlook for Alphabet and Meta Platforms stock. Some analysts believe that the companies are well-positioned to weather the current macroeconomic headwinds, while others believe that the stocks are overvalued and could be due for a correction.

    Investors should consider their own circumstances and investment goals before making any decisions about whether to buy, sell, or hold Alphabet or Meta Platforms stock.