Investors endured their worst period of volatility in years last week. Both the Dow Jones Industrial Average (DJINDICES:^DJI) and the S&P 500 (SNPINDEX:^GSPC) lost about 5% by the end of the week and are now down by about 2% for the year.
While the market might gyrate in response to shifting investor attitudes, it's earnings results that determine long-run stock price trends. With that in mind, let's look at a few of the most anticipated reports set to publish over the next few trading days, from Under Armour (NYSE:UA) (NYSE:UAA), TripAdvisor (NASDAQ:TRIP) and Campbell Soup (NYSE:CPB).
Under Armour's growth pace
Investors could hardly be more pessimistic about Under Armour's fourth-quarter results, due out before the market opens on Tuesday. The sports apparel titan's last report was a bust, with sales and profitability both shrinking because of a brutal sales environment in the core U.S. market. "We do not expect these conditions to improve," CEO Kevin Plank bluntly warned investors in an earnings call in late October.
Shareholders are expecting weak demand to drive heavy promotional activity over the holiday season, which should translate into nearly flat sales and another round of sinking gross profit margin. Rival Nike recently pointed to signs of a stabilization coming in the U.S. after over a year of contraction, but that optimism is mostly thanks to the fact that it is introducing dozens of new apparel and footwear products over the next few months. Investors will find out on Tuesday whether Under Armour believes it can engineer a rebound, too, when the company issues its first official forecast for fiscal 2018.
TripAdvisor's hotel business
It boasts one of the biggest online travel communities around, but TripAdvisor can't seem to find a way to turn that asset into a formidable business. Shares dramatically underperformed the market last year, after the company missed management's growth targets in both the second and third quarters. That poor track record has investors feeling cautious heading into Thursday morning's report.
TripAdvisor's core hotel business has struggled to return to growth following last year's switch to a new business model. Management had predicted that the shift would improve customer satisfaction and drive profitable long-term growth. That forecast hasn't panned out, though. Instead, the hotel segment contracted in the most recent quarter despite a marketing blitz aimed at driving traffic to the website.
In addition to the hotel division, shareholders will be watching for signs of continued gains in the promising attraction-booking business. That segment has grown far more profitable recently, and TripAdvisor will probably need that success to continue if it's going to avoid its third straight year of reduced earnings.
Campbell Soup's outlook
Campbell Soup will post its fiscal second-quarter results on Friday morning. The packaged-foods specialist hasn't impressed investors lately. In fact, organic sales ticked lower last year thanks to the combination of several negative trends, led by shifting food preferences on the part of consumers.
Campbell is hoping to change that dynamic in part by bulking up its brand portfolio through aggressive acquisitions like its purchase of pretzel and snack giant Snyder's-Lance. Executives hope the new combined business will be both leaner and more profitable, with a stronger focus on snack foods.
Look for CEO Denise Morrison and her executive team to spend time on Friday discussing their plans for extracting value from this $5 billion purchase as they enter what could be the business' third year of organic sales declines.
Demitrios Kalogeropoulos owns shares of Nike, TripAdvisor, Under Armour (A Shares), and Under Armour (C Shares). The Motley Fool owns shares of and recommends Nike, TripAdvisor, Under Armour (A Shares), and Under Armour (C Shares). The Motley Fool has a disclosure policy.