Latest news with #EarningsTrends
Globe and Mail
14 hours ago
- Business
- Globe and Mail
Zacks Earnings Trends Highlights: JPMorgan, Bank of America and Wells Fargo
For Immediate Release Chicago, IL – June 26, 2025 – Zacks Director of Research Sheraz Mian says, "While negative revisions to Q2 estimates have stabilized in recent weeks, estimates for the period have been under significant pressure relative to other recent periods since the June-quarter got underway." A Closer Look at Q2 Earnings: What Can Investors Expect? Note: The following is an excerpt from this week's Earnings Trends report. You can access the full report that contains detailed historical actual and estimates for the current and following periods, please click here>>> Here are the key points: Total S&P 500 earnings for the June quarter are expected to be up +4.9% from the same period last year on +3.9% higher revenues. While negative revisions to Q2 estimates have stabilized in recent weeks, estimates for the period have been under significant pressure relative to other recent periods since the June-quarter got underway. Q2 earnings estimates for 13 of the 16 Zacks sectors have come down since the quarter got underway, with Aerospace, Utilities, and Consumer Discretionary as the only sectors whose estimates have modestly moved higher since the start of April. Q2 earnings estimates for the Tech and Finance sectors, the two largest contributors to aggregate S&P 500 earnings, accounting for 51% of all index earnings, have also been cut since the quarter got underway. The quarter started with significant pressure on Tech sector estimates, but the negative revisions trend notably stabilized in the subsequent weeks. In terms of year-over-year growth, three sectors are expected to enjoy double-digit earnings growth in Q2: Aerospace (+15.1%), Tech (+11.8%), and Consumer Discretionary (+105.6%). On the negative side, seven sectors are expected to earn less in Q2 relative to the year-earlier period, with double-digit declines at the Energy (-24.9%), Construction (-14.4%), and Autos (-30.2%) sectors. The Q2 earnings season will really get going once JPMorgan JPM, Bank of America BAC and Wells Fargo WFC kick-off the June-quarter reporting cycle for the Finance sector. Making Sense of Earnings Expectations for 2025 Q2 and Beyond The start of Q2 coincided with heightened tariff uncertainty following the punitive April 2 nd tariff announcements. While the onset of the announced levies was eventually delayed by three months, the issue has understandably weighed heavily on estimates for the current and upcoming quarters, particularly in the first few weeks following the April 2 nd announcement. The expectation at present is for Q2 earnings for the S&P 500 index to increase by +4.9% from the same period last year on +3.9% higher revenues. While it is not unusual for estimates to be adjusted lower, the magnitude and breadth of Q2 estimate cuts are greater than we have seen in the comparable periods of other recent quarters. Since the start of the quarter, estimates have come down for 13 of the 16 Zacks sectors, with the biggest declines for the Transportation, Autos, Energy, Construction, and Basic Materials sectors. The only sectors experiencing favorable revisions in this period are Aerospace, Utilities, and Consumer Discretionary. Estimates for the two largest earnings contributors to the index – Tech & Finance – have also declined since the quarter began. Tech sector earnings are expected to be up +11.8% in Q2 on +10.8% higher revenues. While these earnings growth expectations are materially below where they stood at the start of April, the revisions trend appears to have notably stabilized lately, as we have been flagging in recent weeks. This stabilizing turn in the Tech sector's revisions trend can be seen in expectations for full-year 2025 as well. The two charts above show that estimates for the Tech sector have stabilized and are no longer under the type of downward pressure experienced earlier in the quarter. The Tech sector is much more than just any other sector, as it alone accounts for almost a third of all S&P 500 earnings. The Earnings Big Picture While estimates for this year have been under pressure lately, there haven't been a lot of changes to estimates for the next two years at this stage. Stocks have recouped their tariff-centric losses, although the issue has only been deferred for now. While some of the more dire economic projections have eased lately, there is still plenty of macro uncertainty that will likely continue to weigh on earnings estimates in the days ahead, particularly as we gain visibility on the tariffs question. Why Haven't You Looked at Zacks' Top Stocks? Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year. Today you can access their live picks without cost or obligation. See Stocks Free >> Media Contact Zacks Investment Research 800-767-3771 ext. 9339 support@ provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. Past performance is no guarantee of future results. Inherent in any investment is the potential for material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit for information about the performance numbers displayed in this press release. Research Chief Names "Single Best Pick to Double" From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all. This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months. Free: See Our Top Stock And 4 Runners Up Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Bank of America Corporation (BAC): Free Stock Analysis Report Wells Fargo & Company (WFC): Free Stock Analysis Report JPMorgan Chase & Co. (JPM): Free Stock Analysis Report
Yahoo
05-06-2025
- Business
- Yahoo
Mag 7 ETFs Surge: Will the Rally Keep Rolling?
After months of turbulence, the Magnificent Seven or Mag 7 stocks roared in May, posting a collective gain of more than 13% — their best monthly performance in nearly two years. The group comprising Apple AAPL, Microsoft MSFT, Alphabet (GOOG, GOOGL), Amazon AMZN, NVIDIA NVDA, Tesla TSLA and Meta Platforms META drove 62% of the S&P 500's gains in such, Roundhill Magnificent Seven ETF MAGS, which offers concentrated exposure to the 'Magnificent Seven' stocks, is up 10% over the past month, almost doubling the broad market fund SPY. NVIDIA and Tesla led the charge, each surging more than 20%. Notably, NVDA reclaimed the position of the world's most valuable company, boasting a market capitalization of $3.45 trillion. The AI darling surpassed Microsoft once again in a meteoric run, driven by unrelenting demand for its artificial intelligence (AI) hardware. Yet, despite the solid rally, the group remains in negative territory year to date (read: ETFs to Bet On as NVIDIA Reclaims Market Cap Crown).We have cited several reasons for the solid performances that are expected to continue in the coming months as well: Superior Earnings Growth: Total first-quarter earnings for Mag 7 are expected to be up 27.2% on 12.2% higher revenues, per the Earnings Trends report. For 2025, the group's earnings are expected to increase by 11.9% on 7.9% higher revenues. Excluding the Mag 7 contribution, total earnings for the remaining S&P 500 companies are expected to grow 5.8% in 2025, which compares to 3.9% growth in 2024. The Mag 7 companies are currently expected to bring in 24.2% of total S&P 500 earnings in 2025 and account for 31.6% of the index's total market capitalization. AI Boom: Though the artificial intelligence (AI) trade has cooled off significantly this year, its adoption will again provide a lift to tech stocks. The latest earnings reports from some of the Mag 7 underscore that strong demand for AI is helping companies navigate tariff-driven economic uncertainty. The expansion of AI applications holds the promise of ushering in fresh opportunities for growth within the sector. Tech companies have poured billions into data centers and AI chips to support the growth of AI models (read: Why Big Tech Stocks Are Powering Market Gains Again). Defensive Play: With rates still high and volatility lingering, these mega-cap tech names are proving to be the market's new safe haven. Magnificent Seven stocks will continue to act as a defensive play amid market uncertainty. These stocks' dominance in terms of earnings strength, cash flow resilience and market leadership positions them as anchors during periods of Fundamentals: These mega-cap tech stocks have superior fundamentals compared to the rest of the S&P 500. They boast faster growth rates, higher profit margins, cleaner balance sheets and reasonable valuations (see: all the Technology ETFs here).Analyst Upgrades: Companies like Amazon and Meta received price-target hikes from analysts, citing factors such as eased U.S.-China tariffs and strong company performance. Amazon's diversified revenue streams and Meta's stable advertising business were highlighted as growth drivers. With the recent rebound, valuations for the Mag 7 have climbed sharply. The group's median forward price-to-earnings (P/E) ratio was approximately 28, up from a low of 22.2 in April, according to LSEG Datastream. In comparison, the broader S&P 500 is trading at a forward P/E of the race to invest in AI infrastructure is leading to increased capital expenditures. This could put pressure on profit margins, especially if the anticipated returns from AI investments take longer to materialize. Further, renewed U.S.-China trade tensions and export restrictions, particularly targeting AI chips, are the major dampeners to the profitability of Mag 7. Roundhill Magnificent Seven ETF is the first-ever ETF that offers investors equal-weight exposure to Magnificent Seven stocks. It has amassed $2.3 billion in its asset base and charges 29 bps in fees per year. MAGS trades in an average daily volume of 2.4 million shares. MicroSectors FANG+ ETN (FNGS): This ETN is linked to the performance of the NYSE FANG+ Index, which is equal-dollar weighted and designed to provide exposure to a group of highly traded growth stocks of next-generation technology and tech-enabled companies. The note accounts for a 10% share in each of the seven stocks. MicroSectors FANG+ ETN has a Zacks ETF Rank #3 (Hold) (read: Google's Black Swan Event and a 25% Loss: ETFs to Consider).Vanguard Mega Cap Growth ETF (MGK): It tracks the CRSP US Mega Cap Growth Index. It holds 69 securities in its basket, with the 'Magnificent Seven' collectively accounting for 53% of the total assets. MGK has a Zacks ETF Rank # S&P 500 Top 50 ETF (XLG): Invesco S&P 500 Top 50 ETF measures the cap-weighted performance of the largest companies on the S&P 500 Index, reflecting the performance of the U.S. mega-cap stocks. It holds 53 stocks in its basket, with the 'Magnificent Seven' accounting for a combined 53.6% share. XLG has a Zacks ETF Rank #2 (Buy).iShares S&P 100 ETF (OEF): iShares S&P 100 ETF offers exposure to the 101 largest U.S. companies. The Mag 7 stocks account for a combined 44.7% share. OEF has a Zacks ETF Rank #2 (Buy). Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Alphabet Inc. (GOOG) : Free Stock Analysis Report Inc. (AMZN) : Free Stock Analysis Report Apple Inc. (AAPL) : Free Stock Analysis Report Microsoft Corporation (MSFT) : Free Stock Analysis Report NVIDIA Corporation (NVDA) : Free Stock Analysis Report Tesla, Inc. (TSLA) : Free Stock Analysis Report SPDR S&P 500 ETF (SPY): ETF Research Reports Alphabet Inc. (GOOGL) : Free Stock Analysis Report Invesco S&P 500 Top 50 ETF (XLG): ETF Research Reports Vanguard Mega Cap Growth ETF (MGK): ETF Research Reports iShares S&P 100 ETF (OEF): ETF Research Reports MicroSectors FANG+ ETN (FNGS): ETF Research Reports Meta Platforms, Inc. (META) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
29-05-2025
- Business
- Yahoo
Analyzing the Current Earnings Outlook
Note: The following is an excerpt from this week's Earnings Trends report. You can access the full report that contains detailed historical actual and estimates for the current and following periods, please click here>>> Here are the key points: Total S&P 500 earnings for the June quarter are expected to be up +5.5% from the same period last year on +3.8% higher revenues, with a broader and greater pressure on estimates relative to other recent periods. Q2 earnings estimates for 15 of the 16 Zacks sectors are down since the quarter got underway, with Aerospace as the only sector whose estimates have moved higher. The Tech sector's estimates are down since the start of the period, but they have notably stabilized in recent weeks. The Q1 reporting cycle is now effectively behind us, with results from less than two dozen S&P 500 members still awaited at this stage. The Q1 earnings cycle has ended for 9 of the 16 Zacks sectors. Total Q1 earnings for the 477 S&P 500 members that have reported results are up +11.4% from the same period last year on +4.4% higher revenues, with 74.2% beating EPS estimates and 62.9% beating revenue estimates. An Underwhelming Retail Sector Earnings Performance Total Q1 earnings for the 28 of the 33 Retail sector companies in the S&P 500 index that have reported already are up +11.2% from the same period last year on +5.0% higher revenues, with 60.7% beating EPS estimates and 57.1% beating revenue estimates. Regular users of Zacks Research know that we have a stand-alone economic sector for the Retail sector, unlike the 'official' Standard & Poor's classification that places retailers in the Consumer Discretionary and Consumer Staples sectors. The Zacks Retail sector includes online vendors like Amazon AMZN, restaurant operators like McDonald's MCD, and conventional retailers like Walmart WMT and Target TGT. The comparison charts below show the Q1 EPS and revenue beats percentages for these companies in the context of what we had seen from the same group of 28 Retail sector companies in other recent periods. Image Source: Zacks Investment Research As you can see above, these Retail sector companies have been struggling to beat EPS and revenue estimates. The comparison charts below show this group's earnings and revenue growth rates in a historical context. The right-hand chart shows the group's earnings and revenue growth pace on an ex-Amazon basis. Image Source: Zacks Investment Research As you can see below, the group's +11.2% earnings growth drops to a decline of -5.0% once Amazon's substantial contribution is excluded from the numbers. If we look at Retail sector earnings on an annual basis, the expectation is for +4.1% earnings growth this year, which follows +22.7% growth in 2024. But as we saw with the Q1 earnings results, all of that growth is coming from Amazon, with this year's +4.1% earnings growth dropping to -0.6% and last year's +22.7% dropping to +1.8% once Amazon's contribution is excluded from the sector's numbers. A significant part of the sector's earnings challenge is a result of margin pressures, with the logistics associated with e-commerce sales forcing retailers to spend heavily on fulfillment and deliveries. You can see this in the chart below that shows the sector's net margins on an annual basis. The left-hand side showing the sector as a whole and the right-hand side showing the sector's margins excluding Amazon. Image Source: Zacks Investment Research As you can see above, Retail sector margins outside of Amazon have been on a downtrend since 2021, with this year's margins expected to serve as a bottom and start recovering going forward. Evolving Expectations for 2024 Q2 and Beyond The start of Q2 coincided with heightened tariff uncertainty following the punitive April 2nd tariff announcements. While the onset of the announced levies was eventually delayed for three months, the issue has understandably weighed heavily on estimates for the current and coming quarters. The expectation at present is for Q2 earnings for the S&P 500 index to increase by +5.5% from the same period last year on +3.8% higher revenues. The chart below shows how Q2 earnings growth expectations have evolved since the start of the year. Image Source: Zacks Investment Research While it is not unusual for estimates to be adjusted lower, the magnitude and breadth of Q2 estimate cuts are greater than we have seen in the comparable periods of other recent quarters. Since the start of the quarter, estimates have come down for 15 of the 16 Zacks sectors, with the biggest declines for the Transportation, Autos, Energy, Construction, and Basic Materials sectors. The only sector experiencing favorable revisions in this period is Aerospace. Estimates for the two largest earnings contributors to the index – Tech & Finance – have also declined since the quarter began. Tech sector earnings are expected to be up +11.9% in Q2 on +9.9% higher revenues. While these earnings growth expectations are materially below where they stood at the start of April, the revisions trend appears to have notably stabilized lately, as we have been flagging in recent weeks. You can see this in the sector's revisions trend in the chart below. Image Source: Zacks Investment Research This stabilizing turn in the Tech sector's revisions trend can be seen in expectations for full-year 2025 as well, as the chart below shows. Image Source: Zacks Investment Research The above two charts show that estimates for the Tech sector have stabilized and are no longer under the type of downward pressure that we were experiencing earlier. The Tech sector is much more than just any another sector, as it alone accounts for almost a third of all S&P 500 earnings. The Earnings Big Picture The chart below shows expectations for 2025 Q1 in terms of what was achieved in the preceding four periods and what is currently expected for the next four quarters. Image Source: Zacks Investment Research The chart below shows the overall earnings picture for the S&P 500 index on an annual basis. Image Source: Zacks Investment Research While estimates for this year have been under pressure lately, there haven't been a lot of changes to estimates for the next two years at this stage. Stocks have recouped their tariff-centric losses, although the issue has only been deferred for now. While some of the more dire economic projections have eased lately, there is still plenty of macro uncertainty that will likely continue to weigh on earnings estimates in the days ahead, particularly as we gain visibility on the tariffs question. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Inc. (AMZN) : Free Stock Analysis Report Target Corporation (TGT) : Free Stock Analysis Report Walmart Inc. (WMT) : Free Stock Analysis Report McDonald's Corporation (MCD) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
Yahoo
15-05-2025
- Business
- Yahoo
Making Sense of the Evolving Earnings Picture
Note: The following is an excerpt from this week's Earnings Trends report. You can access the full report that contains detailed historical actual and estimates for the current and following periods, please click here>>> Here are the key points: Total Q1 earnings for the 456 S&P 500 members that have reported results are up +12.1% from the same period last year on +4.5% higher revenues, with 73.9% beating EPS estimates and 62.1% beating revenue estimates. We continue to believe that this earnings season was less about what companies earned in the first quarter of 2025 and more about sizing up the earnings impact of the evolving macroeconomic and public policy backdrop. To that end, management commentary has largely been reassuring despite the uncertainty. Estimates for the current period (2025 Q2) have been under pressure, with bigger declines in estimates compared to other recent post-COVID periods. That said, estimates for the Tech sector have notably stabilized lately. For 2025 Q2, total S&P 500 earnings are expected to be up +5.9% from the same period last year on +3.8% higher revenues. Q2 estimates have been steadily coming down, with the magnitude and breadth of negative estimate revisions greater than had been the case in the comparable periods of other recent quarters. The start of Q2 coincided with heightened tariff uncertainty following the punitive April 2nd tariff announcements. While the onset of the announced levies was eventually delayed for three months, the issue has understandably weighed heavily on estimates for the current and coming quarters. The expectation at present is for Q2 earnings for the S&P 500 index to increase by +5.9% from the same period last year on +3.8% higher revenues. The chart below shows how Q2 earnings growth expectations have evolved since the start of the year. Image Source: Zacks Investment Research While it is not unusual for estimates to be adjusted lower, the magnitude and breadth of the Q2 estimate cuts are greater than we have seen in the comparable periods of other recent quarters. Since the start of the quarter, estimates have come down for 13 of the 16 Zacks sectors, with the biggest declines for the Transportation, Autos, Energy, Construction, and Basic Materials sectors. Estimates for the two largest earnings contributors to the index – Tech & Finance – have declined since the quarter began. Tech sector earnings are expected to be up +12.4% in Q2 on +9.8% higher revenues. While these earnings growth expectations are materially below where they stood at the start of April, the revisions trend appears to have notably reversed course in recent weeks, as we have been flagging lately. You can see this reversal in the sector's revisions trend in the chart below. Image Source: Zacks Investment Research This favorable turn in the Tech sector's revisions trend can be seen in expectations for full-year 2025 as well, as the chart below shows. Image Source: Zacks Investment Research Hard to tell at this stage how durable this reversal in the Tech sector's estimates will prove to be, but the favorable turn in the sector's Q2 estimates at least proves that the shift to the annual growth pace isn't solely a function of strong positive Q1 earnings releases, particularly from the Mag 7 players. We can see this trend reversal in the estimates for Microsoft MSFT, Alphabet GOOGL, and Meta META. The current Q2 Zacks Consensus EPS estimate for Alphabet of $2.12 is down from $2.15 on April 4th, but is up from $2.08 on April 25th and $2.07 a week prior to that. Similarly, for Meta, the current Q2 EPS estimate of $5.84 is down from $5.94 on April 4th, but up from $5.70 on May 2nd and $5.51 on April 25th. The revisions trend for Microsoft is similar, though the company's current Q2 estimate is modestly higher relative to where it stood at the start of April. You can rest assured that we will be closely monitoring the Tech sector's revisions trend in the days ahead. The chart below shows expectations for 2025 Q1 in terms of what was achieved in the preceding four periods and what is currently expected for the next three quarters. Image Source: Zacks Investment Research The chart below shows the overall earnings picture for the S&P 500 index on an annual basis. Image Source: Zacks Investment Research While estimates for this year have started coming down lately, there haven't been a lot of changes to estimates for the next two years at this stage. Given all-around worries about the economy's growth momentum, it is reasonable to expect these estimates to be lowered further in the days ahead as the tariffs impact starts showing up in data. The modestly negative GDP read for the first quarter of the year primarily reflected the anticipatory effects of the trade regime, with importers stocking up on supplies ahead of the new levies taking effect. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Microsoft Corporation (MSFT) : Free Stock Analysis Report Alphabet Inc. (GOOGL) : Free Stock Analysis Report Meta Platforms, Inc. (META) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
