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3 Companies Positively Surprising in Earnings Season

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Earnings season has quickly arrived at our doorstep, and investors are undoubtedly ready for companies to pull the curtain back and unveil what’s transpired behind the scenes.

The big banks kicked off earnings season, and today we’ll receive quarterly results from companies including Alcoa Inc. (AA - Free Report) , Discover Financial Services (DFS - Free Report) , and Kinder Morgan Inc. (KMI - Free Report) .

So far, there have been several companies stealing the spotlight in earnings season so far, including Taiwan Semiconductor Manufacturing (TSM - Free Report) , United Air Lines (UAL - Free Report) , and JPMorgan Chase & Co (JPM - Free Report) .

Below is a chart illustrating the year-to-date performance of all three stocks, with the S&P 500 blended in as a benchmark.

Zacks Investment Research
Image Source: Zacks Investment Research

Let’s take a closer look at each one.

United Airlines

United Airlines transports passengers and cargo throughout North America and destinations in Asia, Europe, the Middle East, and Latin America.

The company came out of the gates and reported EPS of $2.46, nearly 19% above our consensus estimate and reflecting a sizable year-over-year change.

Price, Consensus, and EPS

Zacks Investment Research
Image Source: Zacks Investment Research

Quarterly revenue was reported at $12.4 billion, roughly 1.4% above expectations and representing a 51% year-over-year increase.

Insiders must have known it was shaping up to be a strong quarter; Edward Shapiro, a director, purchased 25,000 UAL shares in December for roughly $1 million.

Scott Kirby, CEO, said, “Over the last three years, United has made critical investments in tools, infrastructure and our people – all of which are essential investments in our future. That’s why we’ve got a big head start, and we’re now poised to accelerate in 2023 as our United Next strategy becomes a reality.”

Taiwan Semiconductor Manufacturing

Taiwan Semiconductor Manufacturing is the world’s largest circuit foundry. Recently, the stock has come under a lot of attention following a purchase from the legendary Warren Buffett.

TSM exceeded the Zacks Consensus EPS estimate of $1.80 per share by roughly 1%, reporting EPS of $1.82. Quarterly revenue totaled $19.9 billion, marginally below our consensus estimate and reflecting a sizable 26% year-over-year increase.

Zacks Investment Research
Image Source: Zacks Investment Research

In addition, the company provided guidance for Q1 2023; TSM expects revenue in the range of $16.7 billion – $17.5 billion and a gross profit margin between 53.5% and 55.5%.

JPMorgan Chase & Co.

Headquartered in New York, JPMorgan Chase & Co. is one of the biggest global banks.

Many were anxious heading into the big banks’ releases, but JPM managed to exceed expectations; the company posted EPS of $3.57, nearly 15% above our $3.11 per share consensus estimate.

The financial titan generated $34.5 billion in revenue, roughly 2% ahead of estimates and reflecting an 18% change from the year-ago quarter.

Zacks Investment Research
Image Source: Zacks Investment Research

Jamie Dimon, CEO, said, “Our lines of business performed well in the quarter, and we continued to see momentum in our areas of strategic focus. In Consumer & Community Banking, debit and credit card sales were up 9%, while card loans were up 19% with total revolving balances now back to pre-pandemic levels.

He continued, "In the Corporate & Investment Bank, Markets revenue rose 7% as client activity remained strong in Fixed Income. Global Investment Banking fees were down significantly in a challenging environment, although we maintained our #1 ranking in 2022. Commercial Banking loans were up 14% on new loan originations and higher revolver utilization. And in Asset & Wealth Management, revenue increased 3% as higher net interest income more than offset the impact of lower market levels.”

Bottom Line

With earnings season kicking into higher gear, investors are more than ready to face the music and find out how the quarter went.

We’ll have a plethora of companies reporting for some time, but all three companies above – Taiwan Semiconductor Manufacturing (TSM - Free Report) , United Air Lines (UAL - Free Report) , and JPMorgan Chase & Co (JPM - Free Report) – have gotten their results out of the way already, positively surprising investors.

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