Best Stocks: How to trade 3 top names on the list reporting earnings this week

CNBC

14-07-2025

(This is The Best Stocks in the Market , brought to you by Josh Brown and Sean Russo of Ritholtz Wealth Management.) Josh — Earnings season is super annoying for trend-following investment strategies. The potential for both positive and negative surprises is higher, which can lead to reversals in trend and gappy trading before and after the opening and closing bells of trading. It can be a minefield. Sean and I try to avoid highlighting names right before they report for this reason. This time, however, we're going to break that tradition and show you a few set-ups for companies due to report this week. There are seven companies on our Best Stocks in the Market list reporting this week. One of them - Fastenal (FAST) - will have already released results prior to this column coming out. Three others have charts that appear to be losing momentum and threatening a downside breach of their uptrends - Kinder Morgan (KMI) , Abbott Labs (ABT) and Cintas (CTAS) — so we'll skip over those. The other three are worth taking a look at. BlackRock (BLK) , Interactive Brokers (IBKR) and Netflix (NFLX) are all strong stocks at interesting inflection points. Let's do some high-level stats on the overall list and then we'll dive in. Sector Leaderboard As of 7/14/2025, there are 136 names on The Best Stocks in the Market list Top Sector Ranking: Top Industries: Top 5 Best Stocks by Relative Strength: Sector Spotlight: Sean — Coming into earnings, all 3 major indices are within 2% of all-time highs: While prices are at or near all-time highs, earnings estimates are not. Throughout Q2, EPS estimates for the S & P 500 have declined 4.2% for this upcoming earnings season. In most quarters, analysts are usually adjusting their estimates down, so this is nothing unusual. However, over the past 20 quarters, the average decline in EPS estimates during the quarter has been a decline of 3%. The average of the past 60 quarters (15 years) has been a decline of 3.2%. So, estimates have shifted further down than normal. On a sectoral basis, every sector saw EPS adjustments lowered, except for communications, which stayed flat. Energy, discretionary, and materials were the three worst sectors with the highest decline in estimates at -18.9%, -7.4%, and -6.4% respectively (from start of quarter to end of quarter). (Data via Factset) Either analysts are lowering the bar for what could be a better-than-expected earnings season, or analysts were too bullish on U.S. earnings power amidst a myriad of risks. This goes without saying, but earnings can be a tumultuous period for single stockholders. It's fair to assume most of a stock's earnings outcome is priced in, but more often than not, the market will have some type of response to earnings. In recent quarters, companies have beaten earnings but issued softer forward guidance; a lot of times, that bit of news is not priced in. Earnings can greatly affect the behavior of investors, and thus earnings can affect the technicals of a stock, which matter to us, a lot. We want to show a couple set-ups of stocks that report earnings this week, so that investors are prepared for a range of possible outcomes coming into these events. BlackRock (BLK) - reports on Tuesday: Sean — Wall Street expects revenue of $5.47 billion, up 13.8% year-over-year and EPS of $10.80, up 4.3% year-over-year. (data via S & P Global and Quartr) Josh — BlackRock exploded higher this summer as the flows into ETFs followed (propelled, some might say) the stock market up and to the right. BlackRock is one of the most pro-cyclical stocks in the market. When asset values are booming and investors want in, their asset gathering activity picks up and, with it, the investment management fees. BlackRock's "all in" initiatives around crypto and private equity products are a big part of the story. In the short term, this is an extended name, far above its 200-day. The recent record high and golden cross (50-day moving above the 200-day) make me want to give it the benefit of the doubt. If you're not already in the stock, I'd wait for the report to come out and focus on a buying opportunity into any profit-taking. So long as it holds above $1,000, I think you can be long. Interactive Brokers Group (IBKR) - reports Thursday Sean — Wall Street expects revenue of $1.38 billion, up 11.8% year-over-year and EPS of $0.46, up 5.2% year-over-year. (data via S & P Global and Quartr) Josh — IBKR is emerging out of a cup-and-handle pattern which you can clearly see in the chart above. RSI at 71 could be considered "overbought" but I don't look at it that way. I see it as a sign of strength when it's accompanying new record high levels in price. Considering the outrageous rally in competitor Robinhood (HOOD) — up 112% since April 30th — this momentum in IBKR makes sense. HOOD is a good comp because, according to Morningstar, approximately 55% of IBKR's commission revenue is retail trading vs 45% institutional. One of the most important metrics IBKR is judged on each quarter is account growth — how many new brokerage clients are they adding to the platform. In Q4, Interactive added 217,000 new accounts, pushing the full year total to above 775,000. Then in Q1 they put up an even more explosive number, 279,000 new accounts, up 32% over the same quarter a year before. There's a seasonality to account opening activity, so expect the pace to decelerate when they report this week. But if the results are solid, there's no reason why this name can't break away and forge a new trading range above current resistance at $60. Netflix (NFLX) - reports on Thursday Sean — Wall Street expects revenue of $11.0 billion, up 15.5% year-over-year and EPS of $7.08, up 45.2% year-over-year. (data via S & P Global and Quartr) Josh — We've been writing positively about Netflix all spring and summer given the powerful rally and accompanying upside fundamental surprises along the way. Netflix continues to shock The Street. That said, recent price action says the stock may have gotten ahead of itself in the short-term. NFLX is in a 7% drawdown from its high, hopefully finding support at the 50-day moving average. I own the stock from lower levels and plan to remain long. If I had no position, I would wait and see rather than buy in anticipation of the earnings print. A "sell the news" reaction post-earnings might open up a better entry point. We'll follow up on this. DISCLOSURES: (None) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. 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