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The Dow endured a particularly tough week, ending with marginal gains for the first time only on Thursday. During the early half of the week, strong earnings results failed to boost investor sentiment. Trade and inflation related fears weighed on investors over most of the week. The Fed refrained from raising rates but market watchers remained concerned over its future actions.
Last Week’s Performance
The Dow decreased 0.1% on last Friday after gaining over two consecutive winning sessions. Strong earnings results from large-cap technology and Internet boosted investors’ sentiment in the mid-day trading.
However, the markets shed most of their gains as soft U.S. GDP data and tepid earnings reports from energy sector tumbled the stocks. The blue-chip index fell in the negative territory primarily due to tepid earnings results from Exxon Mobil Corporation (XOM - Free Report) .
The Dow lost 0.6% over last week. Investors remain concerned that iPhone sales may come in below expectations in the second quarter. Meanwhile, Caterpillar Inc.’s (CAT - Free Report) forecast that economic growth might decelerate later this year also dampened investor sentiment. A spike in Treasury yield also weighed on broader markets.
The DowThisWeek
The index declined 0.6% on Monday as a broad-based decline pushed all the three major indexes in red. Slide into the healthcare and industrial stocks more than offset gains from several merger and acquisitions (M&A) except a telecom mega deal. Moreover, strong first quarter earnings results also failed to uplift investor sentiment.
The Dow gained 0.3% during the month of April. Strong earnings results by most of the large U.S. corporates failed to encourage investors. Disappointing guidance by Taiwan Semiconductor (TSM - Free Report) , the largest contract chipmaker worldwide, led to losses for tech majors. Rising bond yields also dented investors’ confidence.
The index lost 0.3% on Tuesday with 9 of the 30-stocks in the index closing in the green while 20 traded in the red. During the trading session, the blue-chip index was once down 1%, nearly touching its lowest close since April 2.
The index declined 0.7% on Wednesday. Markets were up in the early hours of trading buoyed by the Fed’s decision to keep monetary policy unchanged. However, the broader-market lost momentum later in the day on news of further escalation of the U.S.-China trade conflict. Strong earnings results from Apple also failed to boost market sentiment as investors remain concerned about inflationary pressures.
The index gained 0.02% on Thursday even as investors remained uneasy ahead of Friday’s official jobs report. Earlier in the day, the Dow was down by nearly 400 points, moving below its 200-day moving average, the first such occurrence since early April. However, it recovered subsequently to post marginal gains as fears related to trade and uncertainty over the Fed’s future actions weighed on sentiment.
Components Moving the Index
Apple Inc. (AAPL - Free Report) reported second-quarter fiscal 2018 earnings of $2.73 per share, which beat the Zacks Consensus Estimate by 4 cents and increased almost 30% year over year. Net sales increased 15.6% year over year to $61.14 billion, which surpassed the Zacks Consensus Estimate of $60.99 billion. Apple has a Zacks Rank #3 (Hold).
Total iPhone unit sales of 52.2 million missed the Zacks Consensus Estimate of 52.9 million but increased 3% year over year on the back of iPhone X, iPhone 8 and iPhone 8 Plus.
For third-quarter fiscal 2018, revenues are projected between $51.5 billion and $53.5 billion. Gross margin is expected within 38-38.5%, while operating expenses are projected within $7.7-$7.8 billion. (Read: Apple Q2 Earnings & Revenues Top Estimates, Up Y/Y)
Chevron Corporation (CVX - Free Report) reported first-quarter earnings per share of $1.90, significantly ahead of the Zacks Consensus Estimate of $1.45. The bottom line also improved significantly from year-ago profit of $1.41. Chevron has a Zacks Rank #3.
Quarterly revenues of $37,764 million lagged the Zacks Consensus Estimate of $38,737 on refining weakness but were up 13% year over year. Chevron’s total production of crude oil and natural gas increased 6.6% compared with last year’s corresponding period to 2,852 thousand oil-equivalent barrels per day (MBOE/d).
DowDuPont Inc. recorded a profit (on a reported basis) of $1.1 billion or 47 cents per share for first-quarter 2018, compared with $888 million or 72 cents per share logged in the comparable quarter a year ago. Barring one-time items, earnings came in at $1.12 per share for the quarter, which topped the Zacks Consensus Estimate of $1.08.
Zacks Rank #3 DowDuPont raked in net sales of $21,510 million for the reported quarter, up 5% from the comparable quarter a year ago. It also surpassed the Zacks Consensus Estimate of $21,320 million.
DowDuPont expects net sales in the second quarter to increase more than 10% and operating EBITDA to rise more than 20% on a year-over-year basis. (Read: DowDuPont Tops Earnings, Revenue Estimates in Q1)
Merck & Co., Inc. (MRK - Free Report) reported first-quarter 2018 adjusted earnings of $1.05 per share, which beat the Zacks Consensus Estimate of 99 cents by 6.1%. Earnings rose 19.3% year over year. Revenues for the quarter rose 6% year over year to $10.04 billion. Sales, however, slightly missed the Zacks Consensus Estimate of $10.12 billion.
Merck raised its outlook for 2018 revenues to the range of $41.8 billion to $43.0 billion (previously $41.2 billion to $42.7 billion). The Zacks Consensus Estimate stands at $41.83 billion.
The company now expects adjusted earnings in the range of $4.16-$4.28, raising it from the previous guidance of $4.08-$4.23. The Zacks Consensus Estimate is pegged at $4.18 per share. The stock has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
McDonald's Corporation (MCD - Free Report) reported first-quarter adjusted earnings per share of $1.79 outpaced the consensus mark of $1.67 by 7.2% and improved 22% from the year-ago quarter. McDonald's has a Zacks Rank #3.
Pfizer, Inc. (PFE - Free Report) reported first-quarter 2018 adjusted earnings per share of 77 cents, which beat the Zacks Consensus Estimate of 74 cents by 4.1%. Earnings rose 12% year over year. Revenues of $12.91 billion missed the Zacks Consensus Estimate of $13.09 billion. Pfizer has a Zacks Rank #3.
Revenues however rose 1% from the year-ago quarter on a reported basis. For 2018, revenues are expected in the range of $53.5 billion to $55.5 billion. Adjusted earnings per share are expected in the range of $2.90-$3.00. (Read: Pfizer Stock Falls on Q1 Sales Miss, Earnings Beat)
Microsoft Corporation (MSFT - Free Report) delivered third-quarter fiscal 2018 earnings of 95 cents per share, which beat the Zacks Consensus Estimate by a dime. The figure rallied 35.7% on a year-over-year basis. Microsoft has a Zacks Rank #3.
Revenues of $26.82 billion increased almost 15.5% from the year-ago quarter (up 13% in constant currency or cc). Further, the figure exceeded the Zacks Consensus Estimate of $25.71 billion. (Read: Microsoft Beats Q3 Earnings on Strong Top-Line Growth)
Intel Corp (INTC - Free Report) delivered first-quarter 2018 non-GAAP earnings of 87 cents per share, which beat the Zacks Consensus Estimate by 16 cents. The figure surged 31.8% from the year-ago quarter but declined 19.4% sequentially. Intel has a Zacks Rank #3.
Revenues totaled $16.07 billion, up 8.6% year over year but down 5.8% quarter over quarter. The figure surpassed the Zacks Consensus Estimate of $15.03 billion. (Read: Intel Beats Q1 Earnings on Robust Data-Centric Growth)
Exxon Mobil reported first-quarter earnings of $1.09 per share, which missed the Zacks Consensus Estimate of $1.14. However, the bottom line increased from the year-ago quarter level of 95 cents. Exxon Mobil has a Zacks Rank #3.
Total revenues in the quarter rose to $68,211 million from $58,671 million a year ago. Moreover, the top line surpassed the Zacks Consensus Estimate of $66,070 million. (Read: Exxon Mobil Falls on Q1 Earnings Miss, Beats on Sales)
Performance of the Top 10 Dow Companies
The table given below shows the price movements of the 10 largest components of the Dow, which is a price weighted index, over the last five days and during the last six months. Over the last five trading days, the Dow has declined 2.1%.
Next Week’s Outlook
Markets have endured a difficult week, weighed down by concerns over the Fed’s future actions and trade related tensions with China. These concerns are unlikely to disappear in the near future. Fears over a spike in inflation have also weighed on investor sentiment.
Economic reports released recently have also been lackluster. The report on GDP was particularly disappointing. Markets will now look to crucial economic reports, such as Friday’s jobs report, for encouragement in the days ahead.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
Image: Bigstock
Dow 30 Stock Roundup: AAPL, DWDP, CVX, MRK, MCD, PFE Beat on Earnings
The Dow endured a particularly tough week, ending with marginal gains for the first time only on Thursday. During the early half of the week, strong earnings results failed to boost investor sentiment. Trade and inflation related fears weighed on investors over most of the week. The Fed refrained from raising rates but market watchers remained concerned over its future actions.
Last Week’s Performance
The Dow decreased 0.1% on last Friday after gaining over two consecutive winning sessions. Strong earnings results from large-cap technology and Internet boosted investors’ sentiment in the mid-day trading.
However, the markets shed most of their gains as soft U.S. GDP data and tepid earnings reports from energy sector tumbled the stocks. The blue-chip index fell in the negative territory primarily due to tepid earnings results from Exxon Mobil Corporation (XOM - Free Report) .
The Dow lost 0.6% over last week. Investors remain concerned that iPhone sales may come in below expectations in the second quarter. Meanwhile, Caterpillar Inc.’s (CAT - Free Report) forecast that economic growth might decelerate later this year also dampened investor sentiment. A spike in Treasury yield also weighed on broader markets.
The Dow This Week
The index declined 0.6% on Monday as a broad-based decline pushed all the three major indexes in red. Slide into the healthcare and industrial stocks more than offset gains from several merger and acquisitions (M&A) except a telecom mega deal. Moreover, strong first quarter earnings results also failed to uplift investor sentiment.
The Dow gained 0.3% during the month of April. Strong earnings results by most of the large U.S. corporates failed to encourage investors. Disappointing guidance by Taiwan Semiconductor (TSM - Free Report) , the largest contract chipmaker worldwide, led to losses for tech majors. Rising bond yields also dented investors’ confidence.
The index lost 0.3% on Tuesday with 9 of the 30-stocks in the index closing in the green while 20 traded in the red. During the trading session, the blue-chip index was once down 1%, nearly touching its lowest close since April 2.
The index declined 0.7% on Wednesday. Markets were up in the early hours of trading buoyed by the Fed’s decision to keep monetary policy unchanged. However, the broader-market lost momentum later in the day on news of further escalation of the U.S.-China trade conflict. Strong earnings results from Apple also failed to boost market sentiment as investors remain concerned about inflationary pressures.
The index gained 0.02% on Thursday even as investors remained uneasy ahead of Friday’s official jobs report. Earlier in the day, the Dow was down by nearly 400 points, moving below its 200-day moving average, the first such occurrence since early April. However, it recovered subsequently to post marginal gains as fears related to trade and uncertainty over the Fed’s future actions weighed on sentiment.
Components Moving the Index
Apple Inc. (AAPL - Free Report) reported second-quarter fiscal 2018 earnings of $2.73 per share, which beat the Zacks Consensus Estimate by 4 cents and increased almost 30% year over year. Net sales increased 15.6% year over year to $61.14 billion, which surpassed the Zacks Consensus Estimate of $60.99 billion. Apple has a Zacks Rank #3 (Hold).
Total iPhone unit sales of 52.2 million missed the Zacks Consensus Estimate of 52.9 million but increased 3% year over year on the back of iPhone X, iPhone 8 and iPhone 8 Plus.
For third-quarter fiscal 2018, revenues are projected between $51.5 billion and $53.5 billion. Gross margin is expected within 38-38.5%, while operating expenses are projected within $7.7-$7.8 billion. (Read: Apple Q2 Earnings & Revenues Top Estimates, Up Y/Y)
Chevron Corporation (CVX - Free Report) reported first-quarter earnings per share of $1.90, significantly ahead of the Zacks Consensus Estimate of $1.45. The bottom line also improved significantly from year-ago profit of $1.41. Chevron has a Zacks Rank #3.
Quarterly revenues of $37,764 million lagged the Zacks Consensus Estimate of $38,737 on refining weakness but were up 13% year over year. Chevron’s total production of crude oil and natural gas increased 6.6% compared with last year’s corresponding period to 2,852 thousand oil-equivalent barrels per day (MBOE/d).
Chevron’s downstream segment achieved earnings of $728 million, 21.4% lower than the profit of $926 million last year. (Read: Chevron Shares Gain After Posting Big Q1 Earnings Beat)
DowDuPont Inc. recorded a profit (on a reported basis) of $1.1 billion or 47 cents per share for first-quarter 2018, compared with $888 million or 72 cents per share logged in the comparable quarter a year ago. Barring one-time items, earnings came in at $1.12 per share for the quarter, which topped the Zacks Consensus Estimate of $1.08.
Zacks Rank #3 DowDuPont raked in net sales of $21,510 million for the reported quarter, up 5% from the comparable quarter a year ago. It also surpassed the Zacks Consensus Estimate of $21,320 million.
DowDuPont expects net sales in the second quarter to increase more than 10% and operating EBITDA to rise more than 20% on a year-over-year basis. (Read: DowDuPont Tops Earnings, Revenue Estimates in Q1)
Merck & Co., Inc. (MRK - Free Report) reported first-quarter 2018 adjusted earnings of $1.05 per share, which beat the Zacks Consensus Estimate of 99 cents by 6.1%. Earnings rose 19.3% year over year. Revenues for the quarter rose 6% year over year to $10.04 billion. Sales, however, slightly missed the Zacks Consensus Estimate of $10.12 billion.
Merck raised its outlook for 2018 revenues to the range of $41.8 billion to $43.0 billion (previously $41.2 billion to $42.7 billion). The Zacks Consensus Estimate stands at $41.83 billion.
The company now expects adjusted earnings in the range of $4.16-$4.28, raising it from the previous guidance of $4.08-$4.23. The Zacks Consensus Estimate is pegged at $4.18 per share. The stock has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
McDonald's Corporation (MCD - Free Report) reported first-quarter adjusted earnings per share of $1.79 outpaced the consensus mark of $1.67 by 7.2% and improved 22% from the year-ago quarter. McDonald's has a Zacks Rank #3.
Revenues of $ 5,138.9 million outpaced the consensus mark of $4,915 million by 4.5% but declined 9% year over year. (Read: McDonald's Q1 Earnings Top, Comps Continue to Impress)
Pfizer, Inc. (PFE - Free Report) reported first-quarter 2018 adjusted earnings per share of 77 cents, which beat the Zacks Consensus Estimate of 74 cents by 4.1%. Earnings rose 12% year over year. Revenues of $12.91 billion missed the Zacks Consensus Estimate of $13.09 billion. Pfizer has a Zacks Rank #3.
Revenues however rose 1% from the year-ago quarter on a reported basis. For 2018, revenues are expected in the range of $53.5 billion to $55.5 billion. Adjusted earnings per share are expected in the range of $2.90-$3.00. (Read: Pfizer Stock Falls on Q1 Sales Miss, Earnings Beat)
Microsoft Corporation (MSFT - Free Report) delivered third-quarter fiscal 2018 earnings of 95 cents per share, which beat the Zacks Consensus Estimate by a dime. The figure rallied 35.7% on a year-over-year basis. Microsoft has a Zacks Rank #3.
Revenues of $26.82 billion increased almost 15.5% from the year-ago quarter (up 13% in constant currency or cc). Further, the figure exceeded the Zacks Consensus Estimate of $25.71 billion. (Read: Microsoft Beats Q3 Earnings on Strong Top-Line Growth)
Intel Corp (INTC - Free Report) delivered first-quarter 2018 non-GAAP earnings of 87 cents per share, which beat the Zacks Consensus Estimate by 16 cents. The figure surged 31.8% from the year-ago quarter but declined 19.4% sequentially. Intel has a Zacks Rank #3.
Revenues totaled $16.07 billion, up 8.6% year over year but down 5.8% quarter over quarter. The figure surpassed the Zacks Consensus Estimate of $15.03 billion. (Read: Intel Beats Q1 Earnings on Robust Data-Centric Growth)
Exxon Mobil reported first-quarter earnings of $1.09 per share, which missed the Zacks Consensus Estimate of $1.14. However, the bottom line increased from the year-ago quarter level of 95 cents. Exxon Mobil has a Zacks Rank #3.
Total revenues in the quarter rose to $68,211 million from $58,671 million a year ago. Moreover, the top line surpassed the Zacks Consensus Estimate of $66,070 million. (Read: Exxon Mobil Falls on Q1 Earnings Miss, Beats on Sales)
Performance of the Top 10 Dow Companies
The table given below shows the price movements of the 10 largest components of the Dow, which is a price weighted index, over the last five days and during the last six months. Over the last five trading days, the Dow has declined 2.1%.
Next Week’s Outlook
Markets have endured a difficult week, weighed down by concerns over the Fed’s future actions and trade related tensions with China. These concerns are unlikely to disappear in the near future. Fears over a spike in inflation have also weighed on investor sentiment.
Economic reports released recently have also been lackluster. The report on GDP was particularly disappointing. Markets will now look to crucial economic reports, such as Friday’s jobs report, for encouragement in the days ahead.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>