Australian earnings this week: the top stocks to watch

Commonwealth Bank of Australia (CBA)

What are the markets expecting from CBA?

Investors approached the CBA’s with a level of caution following a quarterly trading update last year the saw the share plunge from record highs. The company published its results on Wednesday morning, and revealed a better than expected NPAT of $4.74B (Est. $4.5B) but a smaller dividend of $1.75 (Est. $1.81) than expected, albeit higher than the comparable period last year. The strong profits came despite a squeeze in net interest margins and moderating loan growth. The company also announced another share buy back to the tune of $2 billion.

Going into the results, analysts were quite bearish on the stock. Out of 14 surveyed brokers by Reuters, the average rating is a sell, with 9 recommending a sell, 1 recommending a strong sell, 2 a hold, 1 a buy, and 1 a strong buy.

Technical analysis of CBA shares

CBA shares have rallied following its first-half results, with the stock breaking resistance at $96.00 and its 50-week moving average, to push towards its 20-week MA and $100 per share. Momentum does appear skewed to the downside still, with the weekly RSI below 50 and recording a series of lower highs. From here, key support levels remain around $96.00 per share and $92.20. While resistance can be found around $100 and $103.50.

AGL Energy (AGL)

What are the markets expecting from AGL?

AGL is expected to post a steep loss when it posts half-year profits this week, with analysts estimating a $-70.7m bottom-line result. Despite this, the company is still tipped to pay out a dividend of $0.126 for the half. The weak financials are underpinned by a drop in wholesale power prices during the half, as lockdowns across Australia and the warmer weather reduced demand for energy.

AGL shares are showing signs of long-term reversal right now. After breaking-out of its downtrend, the share price is putting in a rounded bottom, with RSI showing positive momentum as it holds above 50. The stock is meeting resistance at its 50-week moving average right now, which if broken, could see it push towards $8.00. While on the downside, key technical supports exists at around $6.30.

AMP (AMP)

What are the markets expecting from AMP?

Another loss for the financial year 2021 is expected from AMP, as the company continues to try and mend the damages inflicted by the Banking and Financial Services Royal Commission. Analysts are tipping a $-266.5m for the year, and no dividend to be paid out by the company, as net cash outflows from Australian Wealth and AMP Capital continues to impact the company’s performance.

At present, broker analysts have an average hold rating on the company (2 buys, 7 holds, 3 sells) and consensus price target of $1.17.

Technical analysis of AMP shares

The trend for AMP shares remains lower, as investors stay largely bearish on the stock. Despite this, there are signs that downside momentum is slowing, with the weekly RSI showing a bullish divergence, and price carving out a descending wedge. Key technical resistance sits around 1.03 right now for AMP stock, while support sits around the most recent lower-low at $0.85.

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