AT&T is expected to announce a multi-year stock buyback program at its investor day, with analysts predicting annual repurchases between $5 billion and $8 billion. The company's stabilized free-cash-flow growth and reduced debt position it well for such a move, though the exact size of the buyback remains debated. The sale of AT&T's stake in DirecTV to TPG for $7.6 billion is anticipated to impact earnings but support future buybacks. Analysts expect buybacks to commence in 2025, with potential increases in subsequent years.
Delta Airlines unveiled a new strategy at its Investor Day, focusing on increasing revenue by reducing upgrades, segmenting products, and using AI for personalized pricing. The airline plans to limit complimentary upgrades and introduce more product tiers to encourage passengers to pay for additional services. Delta is testing AI-driven pricing to determine the maximum fare each passenger is willing to pay, aiming to enhance revenue management. The airline's loyalty program is also being re-evaluated to align with these changes, emphasizing brand perception over traditional value.
United Parcel Service (NYSE: UPS) stock is down nearly 8% as investors are concerned about the near-term outlook despite the company's exciting long-term targets, including an increased revenue target for 2026. UPS warned of a tough current quarter with profits expected to be down 40% year over year, prompting aggressive cost-cutting measures. The stock has underperformed archrival FedEx, and while there is potential, management needs to demonstrate progress before investor confidence is restored.
McDonald's is expected to provide updates on its expansion plans, digital strategy, and a new spinoff brand called CosMc's at its investor day. While no major shifts in strategy are anticipated, analysts predict the release of a near-term sales growth forecast and plans for new unit development. The company's restructuring and its impact on decision-making will likely be addressed. McDonald's also aims to accelerate growth in its U.S. footprint, experimenting with fresh restaurant formats and features. Additionally, the company plans to expand in its international markets, including China, where it recently bought back a minority stake. Technology advancements, such as AI for drive-thru orders, may also be discussed.
Arista Networks (ANET) saw a dip in its stock following its investor day, where analysts assessed its financial outlook through 2027. While the company's revenue guidance for 2024 was in line with expectations, its longer-term guidance of a 15% compound annual growth rate (CAGR) from 2022-2027, implying a deceleration in growth after 2024, led to the sell-off. Arista expects a boost from customer investments in artificial intelligence infrastructure by 2025. Its main competitors are Cisco Systems and Juniper Networks, and it is gaining ground in the enterprise market.
CNBC's Jim Cramer believes that Constellation Brands' upcoming investor day on November 2nd could be a significant catalyst for the company's stock. This event follows activist hedge fund Elliott Management's disclosure of a stake in Constellation and an information sharing agreement. Cramer suggests that Elliott may push for changes such as divesting the underperforming spirits business or implementing a buyback program. Despite a 3% drop in the stock price following the company's strong earnings report, Cramer views it as a buying opportunity and expects more insights into the company's future prospects at the investor day.
Delta Air Lines raised its 2023 earnings outlook and maintained its fiscal 2024 view in an investor day presentation. The company expects earnings per share of $5 to $6 for fiscal 2023, with free cash flow at $3 billion for the year. Delta also raised its second-quarter revenue outlook to a growth range of 17% to 18%. Meanwhile, rival carriers United Airlines and American Airlines surpassed buy points for their respective cup-with-handle bases. Delta shares climbed 2.5% following the outlook updates.
Tesla is holding its annual Shareholders Meeting today, where shareholders will vote on director appointments, stockholder proposals, and special items. After the official items, Tesla's management will hold a presentation about the state of the company and take questions from shareholders. Shareholders are likely to ask about the state of Tesla's demand, recent price cuts, Cybertruck production, and Musk's commitment to the company. The meeting can be watched via livestream.
