It was another tough time for investors last week, as both the Dow Jones Industrial Average (^DJI 1.56%) and the S&P 500 (^GSPC 1.52%) shed 5%. Most of that decline came following news that inflation was still running near a 40-year high, suggesting further aggressive interest-rate increases on the way from the Federal Reserve.
Many individual stocks performed better, though, especially in the case of positive earnings announcements. With that in mind, let's preview reports on the way this week from Kroger (KR +3.84%), Jabil (JBL 1.19%), and Adobe (ADBE 1.43%).
1. Kroger's profit outlook
Kroger's stock took a hit after rival Walmart (WMT +1.49%) lowered its 2022 earnings outlook last month, and we'll learn on Thursday whether the supermarket chain avoided those profit challenges.
There are good reasons to believe Kroger can outperform its bigger rival. The chain closed the growth gap last quarter, in part thanks to excitement around its fresh produce and prepared food niches. Follow comparable-store sales for signs that Kroger is gaining market share. That metric rose 3% in Walmart's last report.
NYSE: KR
Key Data Points
Kroger navigated through soaring costs in early 2022, and investors are hoping that it can extend that positive momentum in this report with help from its vertically integrated supply chain.
When costs are spiking, it's handy to own your own dairy farm, trucking company, and retailing network. Follow Kroger's earnings outlook, which currently calls for a big annual profit boost, for evidence of continued pricing power.
2. Jabil's operating margin
Electronics manufacturing specialist Jabil will announce its latest earnings results on Thursday, and investors have big questions heading into the report. The company trounced expectations at its last outing, which showed an 11% sales boost. Even more impressive was Jabil's 23% increase in earnings per share.
Follow Jabil's operating profit margin for signs that the company is still benefiting rising demand in the smartphone, cloud services, and automotive niches. That metric was below 5% of sales last quarter but has the potential to rise with increased prices.
Jabil raised its 2022 outlook back in March, and management now sees revenue landing at $32.6 billion, or about 11% higher than 2021. The big question is how its partnership with Apple might set it up for even faster gains down the line.
3. Adobe's growth rate
Despite having set new sales and cash flow records last quarter, Adobe's stock has fallen since that report in late March. The main concern from investors is that growth will slow following two years of booming demand for its digital media products through earlier phases of the pandemic.
That slowdown isn't likely to threaten the long-term outlook for Adobe, which announces fiscal Q2 results on Thursday. Executives in March predicted sales would grow at roughly 15% for the period, compared with Q1's 17% increase.
In addition to hitting those numbers, investors are hoping that Adobe might project a brighter earnings outlook over time as more businesses and consumers shift creative work onto its cloud services platform.
