Latest news with #Q2
Globe and Mail
4 hours ago
- Business
- Globe and Mail
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. 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. 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. 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 2 nd 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. 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. 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. 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. 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. Only $1 to See All Zacks' Buys and Sells We're not kidding. Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent. Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators, and more, that closed 256 positions with double- and triple-digit gains in 2024 alone. See Stocks Now >> 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
Entrepreneur
2 days ago
- Business
- Entrepreneur
Workday Stock Price Implosion: An Automatic Buy for AI Investors
Workday's tepid Q2 and FY guidance are likely cautious estimates that will be outperformed by wide margins, catalyzing an analyst upgrade cycle. This story originally appeared on MarketBeat Workday's (NASDAQ: WDAY) May stock price implosion is a signal for AI investors to buy. The drop was caused by a tepid guide that included an expectation for sustained and accelerating double-digit growth and comes with a high likelihood of being beaten. Not only has Workday outperformed its consensus estimates for top and bottom line results 99.5% of the time since 2020, but the Q2 outlook and reaffirmed 2025 guidance reflect none of the Q1 strength. [content-module:CompanyOverview|NASDAQ:WDAY] The Q1 strengths are substantial, including backlog growth, margin expansion, and free cash flow improvements. The takeaway for investors is that at $235, Workday's price offers a low risk-to-reward profile and potential catalyst for higher prices in upcoming earnings reports. Analysts are a headwind in late Q2 but are helping to set up a stock price rebound for later in the year. Most revisions following the Q2 release are price target reductions, with the low end leading to the $250 level. The critical details are that this stock remains a Moderate Buy rated and the revision activity aligns with the consensus estimates. The total and trimmed revisions average is $290, about $3 or 100 basis points below the consensus. Consensus forecasts an 18-month closing high, a 17% gain from the critical support level; the market catalyst will be a reversion to price target increases spurred by upcoming business strength. Workday Builds Momentum in Q1 With Agentic AI and Automation Workday had a solid quarter in Q1 with its core subscription business growing by 13.4%, driving a 12.6% top-line gain, 100 basis points better than MarketBeat's reported consensus. The strength is in long-term contracts and large clients, including increased business with names like Chipotle Mexican Grill and new business with names like United Airlines and Dover Corporation. [content-module:Forecast|NASDAQ:WDAY] Other strengths were seen in the margins. The company expanded its gross and operating margins due to improved revenue leverage and operational quality, driving a 430-basis-point increase in the adjusted operating margin and a significant improvement in cash flow and free cash flow. Adjusted profit grew by 31% and adjusted earnings by 28%, outpacing the consensus by 1100 basis points, while cash flow increased by 22% and free cash flow by 44%. The critical takeaway is that the free cash flow is sufficient to cover the share buybacks and sustain the healthy balance sheet. The guidance is the market's sticking point. The company reaffirmed the outlook for 2025 despite the Q1 strength, forecasting a weaker-than-consensus result in Q2. However, Q2 subscription revenue growth is predicted to accelerate, and the guidance is likely low. Details like the 15.6% increase in long-term subscription backlog and 19% increase in total subscription backlog suggest the outperformance could be substantial. Workday's Balance Sheet Is a Fortress for Tech Investors to Take Shelter In Workday's balance sheet is a fortress and getting stronger by the quarter. The improved cash flow allows for accelerating share repurchases, which are on the brink of overtaking dilutive actions, including share-based compensation. Highlights at the end of Q1 include reduced cash and total assets, flat equity and share count, but leverage remains low, the company is net cash, and the stage is set for value gains later in the year. The question now is what the institutions will do. The institutions own about 90% of the stock and are the primary force behind long-term market direction. They have been buying in 2025, but activity slowed in Q2. The post-release price plunge puts the market back into the institutional buying range. If they fail to support the market now, this stock could fall below critical support and revert to previous lows. Before you make your next trade, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. Our team has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and none of the big name stocks were on the list. They believe these five stocks are the five best companies for investors to buy now... See The Five Stocks Here
Globe and Mail
20-05-2025
- Business
- Globe and Mail
/R E P E A T -- Scotiabank to Announce Second Quarter 2025 Results/
TORONTO, April 29, 2025 /CNW/ - Scotiabank will announce its second quarter results on Tuesday, May 27, 2025. Scotiabank Results News Release Financial results will be issued in a press release at approximately 6:00 a.m. ET on Tuesday, May 27, 2025. The results will be available on Scotiabank's Investor Relations Financial Results page.
Yahoo
19-05-2025
- Business
- Yahoo
Capital Bank Launches New Digital Banking Platform in Partnership with Q2, Advancing Innovation and Customer-Focused Growth
ROCKVILLE, Md., May 19, 2025 (GLOBE NEWSWIRE) -- Capital Bank, N.A. has officially launched its new digital banking platform, powered by Q2, a leader in digital transformation for financial services. The upgrade delivers a secure, modern experience for business customers and marks a major step in the Bank's ongoing digital evolution. Known for its agile, growth-oriented approach, Capital Bank continues to invest in technology that enhances efficiency and meets the demands of today's business environment . The new platform includes advanced digital treasury management capabilities and provides the scalability needed to expand into new geographies and new customer segments. 'This launch is more than a technology upgrade—it's a strategic step in how we scale Capital Bank,' said Ed Barry, CEO of Capital Bank. 'By investing in a modern, flexible platform, we're strengthening our ability to serve complex business needs, expand into new markets, and deliver the kind of seamless experience today's customers expect. It's a move that aligns technology with our broader growth strategy and positions us to better serve an increasingly digital economy—without losing the personal touch that defines who we are.' The platform gives customers consistent access across devices and equips the Bank to stay nimble in a rapidly changing financial landscape. 'Providing reliable, high-quality service—both in person and online—is a priority for our entire organization,' added Steve Poynot, President and COO of Capital Bank. 'This partnership with Q2 allows us to bring our relationship-first approach into the digital space, ensuring our customers experience convenience without compromise.' About Capital BankCapital Bank is a subsidiary of Capital Bancorp, Inc. (NASDAQ: CBNK), a publicly traded company with more than $3.3 billion in assets as of March 31, 2025. The Bank is a member of the Federal Reserve Bank System, FDIC-insured, and an Equal Housing Lender. Since 1999, Capital Bank has combined innovative technology with customized financial solutions to help clients grow. Its long-standing success is grounded in a simple principle: Think Big, Act Local. To learn more, visit Dominic CanusoEVP, Chief Financial Officerdcanuso@ ext.1223Sign in to access your portfolio
Yahoo
19-05-2025
- Business
- Yahoo
Capital Bank Launches New Digital Banking Platform in Partnership with Q2, Advancing Innovation and Customer-Focused Growth
ROCKVILLE, Md., May 19, 2025 (GLOBE NEWSWIRE) -- Capital Bank, N.A. has officially launched its new digital banking platform, powered by Q2, a leader in digital transformation for financial services. The upgrade delivers a secure, modern experience for business customers and marks a major step in the Bank's ongoing digital evolution. Known for its agile, growth-oriented approach, Capital Bank continues to invest in technology that enhances efficiency and meets the demands of today's business environment . The new platform includes advanced digital treasury management capabilities and provides the scalability needed to expand into new geographies and new customer segments. 'This launch is more than a technology upgrade—it's a strategic step in how we scale Capital Bank,' said Ed Barry, CEO of Capital Bank. 'By investing in a modern, flexible platform, we're strengthening our ability to serve complex business needs, expand into new markets, and deliver the kind of seamless experience today's customers expect. It's a move that aligns technology with our broader growth strategy and positions us to better serve an increasingly digital economy—without losing the personal touch that defines who we are.' The platform gives customers consistent access across devices and equips the Bank to stay nimble in a rapidly changing financial landscape. 'Providing reliable, high-quality service—both in person and online—is a priority for our entire organization,' added Steve Poynot, President and COO of Capital Bank. 'This partnership with Q2 allows us to bring our relationship-first approach into the digital space, ensuring our customers experience convenience without compromise.' About Capital BankCapital Bank is a subsidiary of Capital Bancorp, Inc. (NASDAQ: CBNK), a publicly traded company with more than $3.3 billion in assets as of March 31, 2025. The Bank is a member of the Federal Reserve Bank System, FDIC-insured, and an Equal Housing Lender. Since 1999, Capital Bank has combined innovative technology with customized financial solutions to help clients grow. Its long-standing success is grounded in a simple principle: Think Big, Act Local. To learn more, visit Dominic CanusoEVP, Chief Financial Officerdcanuso@ ext.1223Error 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
