Earlier today we looked at some ASX shares that Goldman Sachs believes could surprise to the upside during this month's earnings season.
But as readers know all too well from previous seasons, there are almost always a few companies that put out results that fall short of expectations. This is part and parcel of investing unfortunately.
With this in mind, Goldman has picked out four ASX shares that it believes could negatively surprise this month. They are as follows:
Commonwealth Bank of Australia (ASX: CBA)
This banking giant could surprise to the downside during earnings season according to Goldman. It notes that Australia's largest bank's first quarter update reveals that it is "not immune from the profitability pressures that the sector currently faces, particularly evident in mortgages."
Goldman commented: "We currently forecast a 1H22E NIM decline of 16 bp to 1.88% (from 2.04% in 2H21) vs VA consensus of a 13bp decline to 1.91% but see downside risk to these numbers given a further increase in funding costs (shift higher in swap rates) which came through, starting in Oct-21."
Mineral Resources Limited (ASX: MIN)
Goldman appears to believe the market is expecting too much from this mining and mining services company and is predicting profits well-below consensus estimates. This is due partly to margin pressures in the mining services business.
It explained: "GSe -5%/-16% below VA consensus 1H FY22 EBITDA/NPAT respectively, likely on higher expected CFR costs across Commodities operations and margin/cost pressure in Mining Services, as a result of labour and resourcing tightness, potential supply chain constraints, and broad cost inflation being experienced by the mining industry (diesel, steel)."
Monadelphous Group Limited (ASX: MND)
The broker feels this mining services company could disappoint due to labour pressures. Goldman notes that Monadelphous' November annual general meeting update highlighted that "border restrictions in its key Western Australia market are resulting in challenges in accessing skilled labour as well as impacting operational productivity levels."
Its analysts added: "Given that majority of MND's E&C orderbook (c.80%) is on fixed price contracts and sizeable proportion (c.50% in normal operating conditions) of its workforce is fly-in and fly-out, we believe that the street is underestimating the impact on MND's margin in the near term."
Temple & Webster Group Ltd (ASX: TPW)
Finally, this online furniture retailer has been tipped to disappoint this month. Goldman's research indicates that Temple & Webster's growth slowed during the second quarter to a level that will fall short of half year expectations. In addition, it feels the challenging digital marketing environment could weigh on its margins.
Overall, it suspects that this "could result in a lower return on marketing investment vs. market expectations over the near term."
