These stocks are expected to have the biggest moves this week on earnings: Carvana, Roblox and more

The second-quarter earnings season is outperforming, with 80% of S&P 500 companies reporting positive earnings and revenue surprises, alongside robust net profit margins. Against this backdrop, several high-growth stocks are poised for significant post-earnings movements this week, driven by options market forecasts and strong analyst conviction. Specifically, Roblox is anticipated to jump 11.3%, Roku 9.5%, Beyond 18.3%, and Carvana 11.6%, with analysts like Wedbush and JPMorgan highlighting compelling growth opportunities and operational improvements for these already high-performing names.

Analysis

The second-quarter earnings season is exhibiting broad strength, with 80% of S&P 500 companies surpassing both earnings and revenue estimates, a figure that exceeds the five-year average of 78%. This robust performance is complemented by the index maintaining a net profit margin above 12% for the fifth consecutive quarter, with analyst consensus pointing toward further margin improvement in the second half of the year. Against this positive macroeconomic backdrop, options market activity is signaling significant expected volatility for several high-growth stocks post-earnings. Roblox (RBLX), already up 105% year-to-date, is anticipated to see an 11.3% price move, supported by strong analyst conviction (24 out of 34 rate it a buy or strong buy) and a view from Wedbush that it represents a compelling growth opportunity. Similarly, Roku (ROKU), up over 25% YTD, is forecast to move 9.5%, with JPMorgan reiterating an overweight rating and raising its price target to $100, citing stable ad spending and potentially conservative guidance. The most substantial moves are expected from Beyond (BYON) and Carvana (CVNA), at 18.3% and 11.6% respectively. Carvana's outlook is particularly notable, having received a recent upgrade to outperform from Oppenheimer, which cited a 'significant fundamental and financial repositioning' that has the business model now 'humming' and generating meaningful cash.

Key Decisions for Investors

• Given the high implied volatility priced by the options market for RBLX, ROKU, BYON, and CVNA, investors could consider options strategies to capitalize on the expected sharp post-earnings price movements.
• The recent Oppenheimer upgrade and commentary on Carvana's improved fundamentals suggest a potential business turnaround; investors should re-evaluate CVNA's financial health as it may no longer be just a high-beta trade but a fundamental recovery play.
• For investors with higher risk tolerance, the strong analyst conviction for Roblox and the specific catalysts identified by JPMorgan for Roku could support initiating or increasing long positions ahead of their earnings reports, despite significant year-to-date appreciation.
• The broad-based strength in S&P 500 earnings and profit margins provides a supportive macro environment for growth stocks, potentially mitigating downside risk for companies that meet or exceed their quarterly expectations.