The second-quarter 2016 earnings season is picking up steam with nearly 951 stocks (including 189 S&P 500 members) expected to release their results this week. The earnings picture will be much clearer following this week’s releases.
This season, we’ve seen as many as 103 releases as of Jul 21, with earnings declining 2.1% in spite of a 1.4% rise in revenues. As for the beat ratios, 68.9% of the companies have come ahead of earnings estimates and 56.3% have surpassed revenue expectations. The projections for the quarter are far from encouraging for the entire gamut of S&P 500 companies. Total earnings are expected to be down 3.6% from the same period last year on 0.5% lower revenues.
Nine out of the 16 sectors in the Zacks coverage universe are expected to witness an earnings decline. The performance of the S&P 500 will primarily be pulled back by the Oil & Energy sector where earnings are expected to be down 78% on a 25.6% decline in total revenues.
However, among the outperformers, utilities are expected to outpace all others this season. Here we will focus on the Utility sector, which is expected to grow second-quarter earnings by 20.5% supported by a 2.4% top-line improvement. Read more details from our weekly Earnings Preview report.
The capital intensive utilities are benefiting from their domestic focus, the prevailing low interest rate environment and the regulated nature of their operation. All these factors along with the indispensability of the services provided are driving consistent performances season after season.
Here, let us focus on a few utilities reporting on Aug 28.
PG&E Corporation (PCG - Free Report) , a Zacks Rank#2 (Buy) stock, delivered a positive earnings surprise of 7.89% in the previous quarter. PG&E Corporation’s Earnings ESP which represents the difference between the Most Accurate estimate of 89 cents and the Zacks Consensus Estimate of 94 cents is -5.32% (read more: PG&E Corporation Q2 Earnings: What's in the Cards?).
CMS Energy (CMS - Free Report) , a Zacks Rank #2 (Buy) stock, delivered a negative earnings surprise of 13.24% in the previous quarter. CMS Energy’s Earnings ESP is +11.43% (read more: CMS Energy May Beat Q2 Earnings: Stock to Gain?).
American Electric Power (AEP - Free Report) , a Zacks Rank #3 (Hold) stock, delivered a negative earnings surprise of 3.77% in the previous quarter. American Electric Power’s Earnings ESP is -2.22.% (read more: American Electric Power Q2 Earnings: What's Ahead?).
SCANA Corporation , a Zacks Rank #4 (Sell) stock, delivered a negative earnings surprise of 7.91% in the previous quarter. SCANA Corporation’s Earnings ESP is -1.37% (read more: SCANA to Report Q2 Earnings: Will Stock Disappoint?).
ITC Holdings , a Zacks Rank #2 (Buy) stock, delivered a positive earnings surprise of 12.24% in the previous quarter. ITC Holdings’ Earnings ESP is -1.37%. Our proven model does not conclusively show that the company will beat estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 or #3 for this to happen.
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 >>
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 second-quarter 2016 earnings season is picking up steam with nearly 951 stocks (including 189 S&P 500 members) expected to release their results this week. The earnings picture will be much clearer following this week’s releases.
This season, we’ve seen as many as 103 releases as of Jul 21, with earnings declining 2.1% in spite of a 1.4% rise in revenues. As for the beat ratios, 68.9% of the companies have come ahead of earnings estimates and 56.3% have surpassed revenue expectations. The projections for the quarter are far from encouraging for the entire gamut of S&P 500 companies. Total earnings are expected to be down 3.6% from the same period last year on 0.5% lower revenues.
Nine out of the 16 sectors in the Zacks coverage universe are expected to witness an earnings decline. The performance of the S&P 500 will primarily be pulled back by the Oil & Energy sector where earnings are expected to be down 78% on a 25.6% decline in total revenues.
However, among the outperformers, utilities are expected to outpace all others this season. Here we will focus on the Utility sector, which is expected to grow second-quarter earnings by 20.5% supported by a 2.4% top-line improvement. Read more details from our weekly Earnings Preview report.
The capital intensive utilities are benefiting from their domestic focus, the prevailing low interest rate environment and the regulated nature of their operation. All these factors along with the indispensability of the services provided are driving consistent performances season after season.
Here, let us focus on a few utilities reporting on Aug 28.
PG&E Corporation (PCG - Free Report) , a Zacks Rank#2 (Buy) stock, delivered a positive earnings surprise of 7.89% in the previous quarter. PG&E Corporation’s Earnings ESP which represents the difference between the Most Accurate estimate of 89 cents and the Zacks Consensus Estimate of 94 cents is -5.32% (read more: PG&E Corporation Q2 Earnings: What's in the Cards?).
CMS Energy (CMS - Free Report) , a Zacks Rank #2 (Buy) stock, delivered a negative earnings surprise of 13.24% in the previous quarter. CMS Energy’s Earnings ESP is +11.43% (read more: CMS Energy May Beat Q2 Earnings: Stock to Gain?).
American Electric Power (AEP - Free Report) , a Zacks Rank #3 (Hold) stock, delivered a negative earnings surprise of 3.77% in the previous quarter. American Electric Power’s Earnings ESP is -2.22.% (read more: American Electric Power Q2 Earnings: What's Ahead?).
SCANA Corporation , a Zacks Rank #4 (Sell) stock, delivered a negative earnings surprise of 7.91% in the previous quarter. SCANA Corporation’s Earnings ESP is -1.37% (read more: SCANA to Report Q2 Earnings: Will Stock Disappoint?).
ITC Holdings , a Zacks Rank #2 (Buy) stock, delivered a positive earnings surprise of 12.24% in the previous quarter. ITC Holdings’ Earnings ESP is -1.37%. Our proven model does not conclusively show that the company will beat estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 or #3 for this to happen.
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 >>
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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