The widely diversified services sector continued reviving from the pandemic blues through the second quarter of 2021, benefiting from the uptick in both manufacturing and non-manufacturing activities driven by the relaxation of restrictions and increased vaccination drives.
The quarter witnessed growth in major manufacturing industries like computer & electronic products; machinery; electrical equipment, appliances & components; transportation equipment, food, beverage & tobacco products; printing & related support activities; and petroleum & coal products.
Among services industries, notable growth came in from transportation & warehousing; management of companies & support services; retail trade; wholesale Trade; accommodation & food services; mining; utilities; construction; health Care & social assistance; finance & insurance; information; educational services; and professional, scientific & technical Services.
Earnings Picture So Far, and Expectations
The second-quarter earnings for the S&P 500 members of the
Business Servicessector have been outstanding, so far. The sector had a commendable start with major players like Equifax ( EFX Quick Quote EFX - Free Report) , IHS Markit ( INFO Quick Quote INFO - Free Report) , Omnicom ( OMC Quick Quote OMC - Free Report) , Interpublic ( IPG Quick Quote IPG - Free Report) and Fiserv ( FISV Quick Quote FISV - Free Report) beating on both earnings and revenues.
Earnings Outlook suggests that earnings for those S&P 500 members of the business services sector, that have reported results, grew 40.2% year over year on 21.7% revenue growth.
Total quarterly earnings for the S&P 500 members of the sector are currently anticipated to display 35.3% year-on-year growth, and revenues will likely reflect a 18.6% rise. This compares favorably with the 8.5% and 3.9% decline in earnings and revenues in the third quarter of 2020, respectively.
VRSK, IT, FIS, DNB in Spotlight
Here we discuss five business services companies, scheduled to report second-quarter 2021 results on Aug 3.
Our quantitative model suggests that the combination of the following two key ingredients — a
Earnings ESP and a Zacks Rank #3 (Hold) or better — increases the odds of a positive earnings surprise. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
You can see
. the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here Verisk Analytics, Inc. ( VRSK Quick Quote VRSK - Free Report) : This New Jersey-based provider of data analytics solutions in the United States and internationally is scheduled to report results after market close.
The Zacks Consensus Estimate for revenues is pinned at $733.1 million, indicating growth of 8% from the year-ago reported figure. Strength across Insurance and Energy and Specialized Markets segments is likely to have aided the top line.
The consensus mark for earnings is pegged at $1.34, calling for an increase of 3.9% from the year-earlier quarter’s reported figure. Cost discipline and lower share count are expected to have aided the bottom line.
Verisk has an Earnings ESP of -1.68% and carries a Zacks Rank #3. (Read more:
Verisk to Report Q2 Earnings: What's in the Offing?) Gartner, Inc. ( IT Quick Quote IT - Free Report) : This Connecticut-based research and advisory company will announce results before market open.
The Zacks Consensus Estimate for revenues is pegged at $1.1 billion, suggesting growth of 15.3% from the year-earlier quarter's reported figure, likely to have been driven by segmental strength. The consensus estimate for earnings stands at $1.74, indicating a year-over-year plunge of 45%.
Gartner has an Earnings ESP of 0.00% and carries a Zacks Rank of 3, currently. (Read more:
Gartner to Report Q2 Earnings: What's in the Cards?) Fidelity National Information Services ( FIS Quick Quote FIS - Free Report) : This Florida-based financial services Technology company’s Zacks Consensus Estimate for earnings is pegged at $1.55, calling for year-over-year growth of 34.8%. The consensus mark for revenues is pinned at $3.4 billion, suggesting a year-over-year jump of 14.4%.
Fidelity National has an Earnings ESP of +1.91% and holds a Zacks Rank #3, at present.
Dun & Bradstreet Holdings, Inc. ( DNB Quick Quote DNB - Free Report) : This New Jersey-based business decisioning data and analytics provider has an Earnings ESP of 0.00% and presently carries a Zacks Rank of 3.
The Zacks Consensus Estimate for revenues is pegged at $524.9 million, suggesting an increase of 24.8%, year over year. The consensus mark for earnings is pinned at 24 cents, indicating a fall of 7.7%, year on year.