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Apple, Amazon, Google, Tesla and Spotify are part of Zacks Earnings Preview
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For Immediate Release
Chicago, IL – April 26, 2021 – Zacks.com releases the list of companies likely to issue earnings surprises. This week’s list includes Apple Inc. (AAPL - Free Report) , Amazon.com, Inc. (AMZN - Free Report) , Alphabet Inc. (GOOGL - Free Report) , Tesla, Inc. (TSLA - Free Report) and Spotify Technology S.A. (SPOT - Free Report) .
Previewing Big Tech Earnings
Technology stocks have been less than stellar performers this year, with a number of last year’s leaders struggling to find traction in an environment that made the previously-shunned cyclical/value stocks more attractive.
Appleand Amazon are clearly the laggards this year, with Microsoft and Alphabet doing better than the market. Part of the explanation likely is that Apple and Amazon were flying high last year and they have been going through a period of consolidation before resuming their upward move. It will be interesting to see if this week’s quarterly results will help change sentiment on these two stocks, as we saw happen for Alphabet following the search giant’s last earnings release.
These five companies combined now account for 16.9% of the total market capitalization of the S&P 500 index, down from 17.4% of the total in October last year, but still second only to the Technology sector’s weight in the index at 31.4% and above the other 15 sectors, including Finance at 13.4% (Finance’s weight increased from 12.1% in October last year).
Beyond the big 5 Tech players, total Q1 earnings for the Technology sector as a whole are expected to be up +24.9% from the same period last year on +18.4% higher revenues. This big picture view of the ‘Big 5’ players as well as the sector as a whole shows that estimates for the coming periods reflect a decelerating growth trend.
Microsoft and Alphabet will report after the market’s close on Tuesday this week (4/27), while Facebook and Apple will report after the market’s close on Wednesday (4/28) and Amazon on Thursday. Other notable reports this week include Tesla, Spotify and a host of blue-chip operators in other sectors.
Q1 Earnings Season Scorecard
We now have Q1 results from 123 S&P 500 members or 24.6% of the index’s total membership. Total earnings (or aggregate net income) for these 123 companies are up +46.7% from the same period last year on +5.1% lower revenues, with 83.7% beating EPS and 75.6% beating revenue estimates.
We get into the heart of the Q1 reporting cycle this week, with more than 800 companies on deck to report results, including 180 S&P 500 members.
The Finance sector is such a big factor in the earnings growth rate for the 123 index members that have reported at this stage. On an ex-Finance basis, the Q1 earnings growth for the remaining companies that have reported results drops to only +6%.
But even on an ex-Finance basis, the Q1 earnings growth rate still compares favorably to other recent periods.
The second set of charts compare the proportion of these 123 index members beating EPS and revenue estimates.
Overall Expectations for 2021 Q1
Looking at Q1 as a whole, combining the actual results that have come out with estimates for the still to come companies, total earnings for the S&P 500 index are expected to up +30.2% on +6.6% higher revenues.
Part of the strong growth in Q1 is reflective of easy comparisons, as the last month of 2020 Q1 was weighed down by the pandemic, though the full impact showed up in Q2. Those easy comparisons are notable for the Finance, Consumer Discretionary, Transportation and Energy sectors. Profitability in these sectors is notably above the Covid-hit levels of the year-earlier period, but they are still below the comparable period in 2019 (2019 Q1), except for the Finance sector.
But it isn’t just easy comparisons that is giving us the strong aggregate growth in 2021 Q1. A number of sectors, including the all-important Technology sector, are on track to produce genuine growth, i.e., 2021 Q1 profitability growth above pre-Covid levels. These include, in addition to Technology, Construction, Medical, Basic Materials, Consumer Staples and Utilities.
On an index ‘EPS’ basis, the 2021 expectation works out to $173.45, up from $136.10 per ‘Index share’ in 2020. These full-year estimates have been going up as well.
We envision this favorable revisions trend to accelerate over the next few months as the vaccination effort reaches a critical mass and greater ‘normalcy’ returns to life.
For a detailed look at the overall earnings picture, including expectations for the coming periods, please check out our weekly Earnings Trends report >>>>A Very Strong Earnings Picture for Q1 and Beyond
Time to Invest in Legal Marijuana
If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027.
After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%
You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Apple, Amazon, Google, Tesla and Spotify are part of Zacks Earnings Preview
For Immediate Release
Chicago, IL – April 26, 2021 – Zacks.com releases the list of companies likely to issue earnings surprises. This week’s list includes Apple Inc. (AAPL - Free Report) , Amazon.com, Inc. (AMZN - Free Report) , Alphabet Inc. (GOOGL - Free Report) , Tesla, Inc. (TSLA - Free Report) and Spotify Technology S.A. (SPOT - Free Report) .
Previewing Big Tech Earnings
Technology stocks have been less than stellar performers this year, with a number of last year’s leaders struggling to find traction in an environment that made the previously-shunned cyclical/value stocks more attractive.
Appleand Amazon are clearly the laggards this year, with Microsoft and Alphabet doing better than the market. Part of the explanation likely is that Apple and Amazon were flying high last year and they have been going through a period of consolidation before resuming their upward move. It will be interesting to see if this week’s quarterly results will help change sentiment on these two stocks, as we saw happen for Alphabet following the search giant’s last earnings release.
These five companies combined now account for 16.9% of the total market capitalization of the S&P 500 index, down from 17.4% of the total in October last year, but still second only to the Technology sector’s weight in the index at 31.4% and above the other 15 sectors, including Finance at 13.4% (Finance’s weight increased from 12.1% in October last year).
Beyond the big 5 Tech players, total Q1 earnings for the Technology sector as a whole are expected to be up +24.9% from the same period last year on +18.4% higher revenues. This big picture view of the ‘Big 5’ players as well as the sector as a whole shows that estimates for the coming periods reflect a decelerating growth trend.
Microsoft and Alphabet will report after the market’s close on Tuesday this week (4/27), while Facebook and Apple will report after the market’s close on Wednesday (4/28) and Amazon on Thursday. Other notable reports this week include Tesla, Spotify and a host of blue-chip operators in other sectors.
Q1 Earnings Season Scorecard
We now have Q1 results from 123 S&P 500 members or 24.6% of the index’s total membership. Total earnings (or aggregate net income) for these 123 companies are up +46.7% from the same period last year on +5.1% lower revenues, with 83.7% beating EPS and 75.6% beating revenue estimates.
We get into the heart of the Q1 reporting cycle this week, with more than 800 companies on deck to report results, including 180 S&P 500 members.
The Finance sector is such a big factor in the earnings growth rate for the 123 index members that have reported at this stage. On an ex-Finance basis, the Q1 earnings growth for the remaining companies that have reported results drops to only +6%.
But even on an ex-Finance basis, the Q1 earnings growth rate still compares favorably to other recent periods.
The second set of charts compare the proportion of these 123 index members beating EPS and revenue estimates.
Overall Expectations for 2021 Q1
Looking at Q1 as a whole, combining the actual results that have come out with estimates for the still to come companies, total earnings for the S&P 500 index are expected to up +30.2% on +6.6% higher revenues.
Part of the strong growth in Q1 is reflective of easy comparisons, as the last month of 2020 Q1 was weighed down by the pandemic, though the full impact showed up in Q2. Those easy comparisons are notable for the Finance, Consumer Discretionary, Transportation and Energy sectors. Profitability in these sectors is notably above the Covid-hit levels of the year-earlier period, but they are still below the comparable period in 2019 (2019 Q1), except for the Finance sector.
But it isn’t just easy comparisons that is giving us the strong aggregate growth in 2021 Q1. A number of sectors, including the all-important Technology sector, are on track to produce genuine growth, i.e., 2021 Q1 profitability growth above pre-Covid levels. These include, in addition to Technology, Construction, Medical, Basic Materials, Consumer Staples and Utilities.
On an index ‘EPS’ basis, the 2021 expectation works out to $173.45, up from $136.10 per ‘Index share’ in 2020. These full-year estimates have been going up as well.
We envision this favorable revisions trend to accelerate over the next few months as the vaccination effort reaches a critical mass and greater ‘normalcy’ returns to life.
For a detailed look at the overall earnings picture, including expectations for the coming periods, please check out our weekly Earnings Trends report >>>>A Very Strong Earnings Picture for Q1 and Beyond
Time to Invest in Legal Marijuana
If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027.
After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%
You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.
Today, Download Marijuana Moneymakers FREE >>
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Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.