Stocks to Watch in November

Earnings reports and holiday shopping will be in the spotlight this month.

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November is a month of cranberry sauce and gratitude, but it often means more than that for investors. We’re wrapping up earnings season now. Holiday shopping will kick off near the end of the month, leaving investors with more knowledge than they had when the month began.

Datadog (NASDAQ: DDOG), Activision Blizzard (NASDAQ: ATVI), and Amazon.com (NASDAQ: AMZN) are some of the companies that will be making moves this month. Let’s see why these are stocks to watch in November.

Activision Blizzard: Nov. 6

Die-hard gamers can be fickle, and this isn’t Activision Blizzard at its best. Analysts are bracing for a 29% year-over-year plunge in quarterly revenue when it reports financial results on Thursday afternoon, with profits being slashed by more than half. Expectations are low, and recent tensions in China, where Activision Blizzard’s move to suspend a prolific esports personality for making comments in support of the Hong Kong protests polarized gamers and investors alike.

Investors will be hanging on for hope when it comes to guidance this week. The company rolled out Call of Duty: Modern Warfare — the latest installment of its combat franchise that peaked in 2011 — as well as Call of Duty: Mobile for smartphone players last month. Between the new releases and a better handle on the fallout from its esports suspension, any insight that Activision Blizzard offers on its near-term prospects will go a long way to dictating the stock’s direction.

Datadog: Nov. 12

The last few months have been rough for the IPO market. We’ve seen prolific offerings come undone before the opening bell, and even many of the big names to make it to the trading floor have buckled below their IPO prices. Investing in IPO stocks isn’t easy these days.

Datadog is one of the few recent debutantes to still have its head above water. The cloud monitoring and analytics specialist went public at $27 in mid-September, and it’s currently trading 28% higher.

The first big test for any IPO is its initial earnings report as a public company, and for Datadog that will come next week. It has a lot of growth momentum heading into next Tuesday’s report. Revenue nearly doubled last year, and it has risen almost 80% through the first half of 2019. With more large companies hopping onto the cloud and uptime reigning supreme, Datadog’s been growing its client base, and the same can be said for how much those customers are willing to pay for the platform’s crucial insight.

A strong report will keep the party going for Datadog, naturally. If things don’t go swimmingly — if the top line decelerates sharply or its impressive dollar-based net retention rate takes a breather — it wouldn’t be a surprise to see the stock become the latest broken IPO. It’s hard to regain the market’s confidence if you burn investors in your first earnings report as a public company.

Amazon.com: Nov. 22

The timing of this year’s Thanksgiving holiday is going to pinch some retailers. The holiday that officially kicks off the telltale shopping season is on the fourth Thursday of the month, and since it falls on Nov. 28 this time, it’s the latest possible start for a season that always ends on Christmas.

Amazon is trying to make its own luck. Instead of following the calendar into Black Friday on Nov. 29, the world’s largest online retailer is launching an eight-day Black Friday sale that starts a week earlier. Kicking off sales on Nov. 22 is brilliant, giving it a jump on the brick-and-mortar competition that’s already reeling from the e-tail challenge. With the company continuing to speed up its fulfillment and lowering the minimum for free shipping on Amazon-warehoused goods, things are shaping up nicely again during this crucial time of year.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Rick Munarriz owns shares of Datadog. The Motley Fool owns shares of and recommends Activision Blizzard and Amazon. The Motley Fool recommends Datadog. The Motley Fool has a disclosure policy.

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