Monday, July 16, 2018This week, Q2 earnings season heats up in a big way, with roughly 60 companies in the S&P 500 reporting earnings. As per typical, early earnings season is heavy with financial institutions, although we also expect results from big non-financial names like Netflix (NFLX - Free Report) and Intel (INTC - Free Report) later in the week.
Prior to today’s market open, Zacks Rank #3 (hold)-rated Bank of America (BAC - Free Report) outperformed expectations on both its top and bottom lines for Q2: 63 cents per share topped the Zacks consensus by 6 cents, on revenues which narrowly edged the $22.5 billion expected. Year over year, BofA earnings were up 43% in the quarter, while on the top line they fell 1% from the June quarter 2017.
Higher interest rates supported the banking major, which noted 7% year over year growth in trading income and +5% in net interest income. This was slightly offset with investment banking down a tad year over year. For more on BAC’s earnings, click here.
Also, investment firm BlackRock (BLK - Free Report) also surpassed estimates this morning. The fellow Zacks Rank #3 (Hold) company put up $6.66 per share from the $6.60 expected — up 28% year over year. Revenues of $3.61 billion easily outpaced the $3.45 billion analysts had been expecting, up 11% from the year-ago quarter. Net income rose 26% from Q2 2017. For more on BLK’s earnings, click here.
We also see new economic data ahead of today’s opening bell, with June Retail Sales and July Empire State reads providing fresh details illustrating our continued robust domestic economy. Retail Sales last month reached +0.5%, exactly in-line with expectations. However, revisions to May were the big story — raised an additional 50 basis points to 1.3% Retail Sales Growth that month.
For June, we strip out auto sales and still see a strong +0.4%, up from the 0.3% expected. This not only spells continued strength for the less volatile segments of the retail space, but for auto sales themselves: many analysts had been looking for a continued pullback in new auto sales, but +0.1% makes those fears look a bit unfounded, at least month over month. Again, May ex-auto numbers were revised upward.
Finally, the Empire State report for July outperformed expectations, posting 22.6 instead of the 21 expected. This is down from the even healthier 25 in May, but with summer seasonality baked into New York State production numbers, we consider north of 22 to be consistent with our overall positive economic outlook.
Mark Vickery
Senior Editor
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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.
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Monday, July 16, 2018
This week, Q2 earnings season heats up in a big way, with roughly 60 companies in the S&P 500 reporting earnings. As per typical, early earnings season is heavy with financial institutions, although we also expect results from big non-financial names like Netflix (NFLX - Free Report) and Intel (INTC - Free Report) later in the week.
Prior to today’s market open, Zacks Rank #3 (hold)-rated Bank of America (BAC - Free Report) outperformed expectations on both its top and bottom lines for Q2: 63 cents per share topped the Zacks consensus by 6 cents, on revenues which narrowly edged the $22.5 billion expected. Year over year, BofA earnings were up 43% in the quarter, while on the top line they fell 1% from the June quarter 2017.
Higher interest rates supported the banking major, which noted 7% year over year growth in trading income and +5% in net interest income. This was slightly offset with investment banking down a tad year over year. For more on BAC’s earnings, click here.
Also, investment firm BlackRock (BLK - Free Report) also surpassed estimates this morning. The fellow Zacks Rank #3 (Hold) company put up $6.66 per share from the $6.60 expected — up 28% year over year. Revenues of $3.61 billion easily outpaced the $3.45 billion analysts had been expecting, up 11% from the year-ago quarter. Net income rose 26% from Q2 2017. For more on BLK’s earnings, click here.
We also see new economic data ahead of today’s opening bell, with June Retail Sales and July Empire State reads providing fresh details illustrating our continued robust domestic economy. Retail Sales last month reached +0.5%, exactly in-line with expectations. However, revisions to May were the big story — raised an additional 50 basis points to 1.3% Retail Sales Growth that month.
For June, we strip out auto sales and still see a strong +0.4%, up from the 0.3% expected. This not only spells continued strength for the less volatile segments of the retail space, but for auto sales themselves: many analysts had been looking for a continued pullback in new auto sales, but +0.1% makes those fears look a bit unfounded, at least month over month. Again, May ex-auto numbers were revised upward.
Finally, the Empire State report for July outperformed expectations, posting 22.6 instead of the 21 expected. This is down from the even healthier 25 in May, but with summer seasonality baked into New York State production numbers, we consider north of 22 to be consistent with our overall positive economic outlook.
Mark Vickery
Senior Editor
Questions or comments about this article and/or its author? Click here>>
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>
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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