Supply Chains Are Still Squeezed. Just Ask These Companies.


Illustration by Elias Stein

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The Delta variant is disrupting global supply chains, and companies are starting to talk about it. Here are five that strategists at RBC Capital Markets highlighted due to concerns about the supply constraints.


Albemarle

: On its recent earnings call, the specialized-chemicals producer cited a range of places where it can’t get its inputs—China, Thailand, the United Kingdom. and eastern Australia. “We’re kind of stuck,” said CEO Jerry Masters. The stock is off 11% from its all-time high this month.


Parker-Hannifin

: The maker of motion and control systems sees supply-chain problems and other Covid uncertainties “throughout the world,” CEO Thomas Williams said on an Aug. 4 earnings call. The stock is down just over 8% from its all-time high, hit in mid-May.


Aptiv

: Closure of auto plants has been a particular problem for the supply chains of this auto-parts maker. “There’s obviously some inefficiencies now creeping into our plants as customers shut down for periods of time,” said Chief Financial Officer Joseph Massaro. Aptiv stock has fallen 6.5% from its all-time high, hit this month.


Western Digital

: “We have to continue to work through the Covid situation from a factory perspective and supply-chain perspective,” said CFO Robert Eulau on the company’s Aug. 4 earnings call. The stock is down 20% from its 2021 high, hit in early June.


Arista Networks

: The networking company’s CFO, Ita Brennan, said on its quarterly call that shipments were down as the company “continued to carefully navigate industrywide supply-chain shortages.” The stock is off 4.7% from its all-time high, hit this month.

Next Week

Monday 8/23


JD.com,

Madison Square Garden Entertainment, and

Palo Alto Networks

report quarterly results.

The National Association of Realtors reports existing-home sales for July. Consensus estimate is for a seasonally adjusted annual rate of 5.83 million homes sold, about even with the June figure. Existing-home sales have slowed from the beginning of the year as prices continue to soar. In June, the median home price was a record $363,300, up 23.4% year over year.



IHS Markit

releases
both its Manufacturing Purchasing Managers’ Index and Services PMI for August. Economists forecast a 63.1 reading for the Manufacturing PMI and a 59.8 reading for the Services PMI. Both figures would be roughly even with the July data.

Tuesday 8/24


Advance Auto Parts,

Bank of Montreal,

Bank of Nova Scotia,


Best Buy,


Intuit,


Medtronic,

and

Toll Brothers

announce earnings.

The Census Bureau reports new single-family home sales for July. Expectations are for a seasonally adjusted annual rate of 700,000 new homes sold, a 3.6% month-over-month rise from June. Much like existing-home sales, new-home sales are off sharply from earlier this year.

Wednesday 8/25


Autodesk,


NetApp,


Royal Bank of Canada,


Salesforce.com,

Snowflake, Splunk, and Ulta Beauty release quarterly results.

The Census Bureau releases the durable goods report for July. The consensus call is for a 0.8% monthly gain in new orders for manufactured durable goods, to $260 billion. Excluding transportation, new orders are expected to rise 0.9%, after increasing 0.5% in June.

Thursday 8/26

The Federal Reserve Bank of Kansas City hosts its annual Economic Policy Symposium in Jackson Hole, Wyo. This year’s theme is “Macroeconomic Policy in an Uneven Economy.” The confab runs through Aug. 28.


Burlington Stores,


Canadian Imperial Bank of Commerce,


Dell Technologies,


Dollar General,


Dollar Tree,


Gap,


J.M. Smucker,


HP Inc.,


Marvell Technology,


Peloton Interactive,


Toronto-Dominion Bank,

and VMware hold conference calls to discuss earnings.

The Bureau of Economic Analysis reports its second estimate for second-quarter gross domestic product. Economists forecast a 6.5% seasonally adjusted annual rate of growth, unchanged from the BEA’s advance estimate from late July.

Friday 8/27

The BEA releases the Personal Income and Outlays report for July. Consensus estimates are for both personal income and spending to rise 0.5% month over month. This compares with increases of 0.1% and 1%, respectively, in June. The PCE Price Index, the Federal Reserve’s favored inflation gauge, is seen jumping 4.2% year over year, after a 4.0% rise in June.

Write to Jacob Sonenshine at jacob.sonenshine@barrons.com

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