Reports of the largest companies (MAMA) may weigh on the further direction

Tech giants and rivals in field of AI will report their results for the last quarter this week. It promises to be a lot of emotions also considering the over 20% increase of the Nasdaq 100 index from last year's low. Will big tech confirm price increases with results, or maybe disappoint investors? Let's look at expectations.

Results of MAMA companies

Microsoft, A, Meta and Amazon (MOMA) will be reporting in the last week of April. These companies have a combined capitalization of more than $5 trillion and account for nearly 15% of the entire S&P500 index. In turn, in the Nasdaq 100 index, they have a weight of 30%. Therefore, these publications may affect the direction of the US stock market in the near future. According to the Refinitiv data and consensus, analysts expect Microsoft, Alphabet and Meta profits to increase by an average of 4,5% compared to the previous quarter, with the increase in the case of Meta amounting to 11,8%. However, compared to last year, profits are expected to fall by almost 16% on average, with Microsoft expected to do best and record only a 0,5% decline.

AI boom

It is also worth noting that companies are likely to provide updates on their AI activities, a clear trend seen since last quarter. It seems, therefore, that while in the last quarter large technology companies were expected to restructure, increase efficiency and improve their results, now announcements regarding the potential of using artificial intelligence in their products will be crucial. Recall that Microsoft has already integrated the company's ChatGPT technology OpenAI with its Bing search engine, and Google has only just started the public release of its Bard chatbot.

Amazon, the world's largest cloud division, AWS, has released a suite of technologies aimed at helping other companies build their own AI-powered chatbots, Reuters reported.

Microsoft and Alphabet shares are up 19% so far this year. Apple Lossless Audio CODEC (ALAC), and Amazon are up 28% and 23% respectively. Meta shares gained almost 77%. We will now look at key metrics and expectations:

Microsoft

• P/E: 31,8
• Forward P/E: 28,9
• Capitalization: USD 2,12 trillion
• EPS forecast: $2,24
  Revenue forecast: $51,12 billion

Google (alphabet)

• P/E: 23,2
• Forward P/E: 20,8
• Capitalization: USD 1,34 trillion
• EPS forecast: $1,08
• Revenue forecast: $68,87 billion

Meta

• P/E: 24,8
• Forward P/E: 21,9
• Capitalization: USD 546 billion
• EPS forecast: $2,02
• Revenue forecast: $27,61 billion

Amazon

• P/E: –
• Forward P/E: 74,9
• Capitalization: USD 1,09 trillion
• EPS forecast: $0,21
• Revenue forecast: $124,55 billion

This week's big tech festival will start with Microsoft and Alphabet after the US session on Tuesday, followed by Meta on Wednesday after the session, and Amazon on Friday.

Based on implied volatility from the market, stock options traders are expecting the most volatility this week on Meta Platforms stocks. Until Friday, the estimated volatility is close to 10%. In second place was Amazon with an implied share price volatility of 7,6%. Investors from the options market expect that Alphabet's share price may change by 6% by the end of the week, and Microsoft's by 4,6%.