The Q2 earnings season will take the spotlight with Alcoa’s (AA) report after the close on July 11th. Total earnings for the S&P 500 index are expected to be down -6.2% from the same period last year on -0.7% lower revenues. This will be the 5th quarter in a row of earnings declines for the index.
As has been the trend in other recent quarters, the Energy sector is a big drag on the aggregate growth picture in Q2 as well. Total earnings for the Energy sector are expected to be down -78.9% from the same period last year on -27.1% lower revenues. Excluding the Energy sector, total earnings for the rest of the S&P 500 index would still be in the negative; a decline of -2.8%.
In total earnings growth is expected to be in the negative for 9 of the 16 Zacks sectors, including Finance and Technology, the two biggest sectors in the index. Total earnings for the Technology sector are expected to be down -6.4% from the same period while the sector’s revenues are expected to be up +2.2%. Tough comparisons at Apple (AAPL - Free Report) , which carries an outsized weight in the sector, are a big reason for the sector’s earnings decline in Q2. Excluding Apple, total earnings for the sector would be essentially flat from the year-earlier period. Beyond Apple, earnings growth is expected to be strong among the space’s new operators like Facebook and Google’s parent Alphabet (GOOGL - Free Report) , but negative among legacy players like Microsoft (MSFT), Intel (INTC) and others.
On the flip side, earnings growth is expected to be positive for the Autos, Construction, Conglomerates and Utilities sectors.
Beyond Q2, earnings growth is expected to be flat in Q3 (actually down -0.1%) and positive in the last quarter of the year (actually +6.8%). Management guidance on the Q2 earnings calls would determine how estimates for Q3 and beyond evolve in the coming days. As such, more than anything else, the most important thing to watch this earnings season will be company guidance and the resultant trends in estimate revisions for Q3 and beyond.
Zacks 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.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
The Q2 earnings season will take the spotlight with Alcoa’s (AA) report after the close on July 11th. Total earnings for the S&P 500 index are expected to be down -6.2% from the same period last year on -0.7% lower revenues. This will be the 5th quarter in a row of earnings declines for the index.
As has been the trend in other recent quarters, the Energy sector is a big drag on the aggregate growth picture in Q2 as well. Total earnings for the Energy sector are expected to be down -78.9% from the same period last year on -27.1% lower revenues. Excluding the Energy sector, total earnings for the rest of the S&P 500 index would still be in the negative; a decline of -2.8%.
In total earnings growth is expected to be in the negative for 9 of the 16 Zacks sectors, including Finance and Technology, the two biggest sectors in the index. Total earnings for the Technology sector are expected to be down -6.4% from the same period while the sector’s revenues are expected to be up +2.2%. Tough comparisons at Apple (AAPL - Free Report) , which carries an outsized weight in the sector, are a big reason for the sector’s earnings decline in Q2. Excluding Apple, total earnings for the sector would be essentially flat from the year-earlier period. Beyond Apple, earnings growth is expected to be strong among the space’s new operators like Facebook and Google’s parent Alphabet (GOOGL - Free Report) , but negative among legacy players like Microsoft (MSFT), Intel (INTC) and others.
On the flip side, earnings growth is expected to be positive for the Autos, Construction, Conglomerates and Utilities sectors.
Beyond Q2, earnings growth is expected to be flat in Q3 (actually down -0.1%) and positive in the last quarter of the year (actually +6.8%). Management guidance on the Q2 earnings calls would determine how estimates for Q3 and beyond evolve in the coming days. As such, more than anything else, the most important thing to watch this earnings season will be company guidance and the resultant trends in estimate revisions for Q3 and beyond.
Zacks 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.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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