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5 Stocks to Watch on Solid Revenues in Last Reported Quarter
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The third-quarter 2023 earnings season is currently in full swing. Although we are at the initial stage of this reporting cycle, the overall earnings picture is better than expected so far. Besides earnings, a major metric to watch in any earnings season is revenues.
Economists and financial researchers closely watch revenues as the metric defines the demand for a company’s products. Earnings can be improved through strict cost control but strong sales imply growing demand for company’s products and services. This gives investors visibility on how a company is performing under competition.
Wall Street is currently suffering from several headwinds. The Fed Chairman’s warning of tougher monetary policies for a longer-than-expected period, the recent surge in the yield of the benchmark 10-Year Treasury Note, a spike in U.S. Dollar prices and geopolitical conflicts in the Middle-East are near-term concerns.
At this juncture, companies that will be able to do good business are expected to be rewarded in stock markets.
Stocks in Focus
We have narrowed our search to five U.S. corporate behemoths that have reported strong revenue growth beside earnings beat in their last reported quarter.
The chart below shows the price performance of our five picks in the past month.
Image Source: Zacks Investment Research
JPMorgan Chase & Co. (JPM - Free Report) reported third-quarter 2023 net revenues of $39.87 billion, up 22% year over year. The top line also surpassed the Zacks Consensus Estimate of $39.14 billion. Net Interest income (NII) jumped 30% year over year to $22.73 billion. This was driven by higher rates and higher revolving balances in Card Services, partially offset by the reduction in deposit balances.
Supported by higher interest rates, the First Republic Bank deal, robust consumer and commercial banking businesses and solid loan balance JPM reported quarterly earnings per share of $4.33 handily outpacing the Zacks Consensus Estimate of $3.89.
JPM now projects NII to be roughly $88.5 billion, driven by higher rates and slower-than-expected deposit repricing across both consumers and wholesale. Earlier, the company had guided NII of $87 billion for this year.
JPMorgan Chase has an expected revenue and earnings growth rate of 10.6% and 2.8%, respectively, for the current quarter. The Zacks Consensus Estimate for current-quarter earnings has improved 2.3% over the last 30 days. JPM currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Procter & Gamble Co.’s (PG - Free Report) organic sales grew in fourth-quarter fiscal 2023, driven by robust pricing and a favorable mix, along with strength across segments. PG reported net sales of $20.553 million, up 5% year over year, surpassing the Zacks Consensus Estimate of $20,020 million.
On an organic basis (excluding special items), revenues improved 8%, backed by a 7% rise in pricing and a 2% gain from a positive product mix, offset by a 1% decline in volume. PG’s core earnings of $1.37 per share surpassed the Zacks Consensus Estimate of $1.32.
Management has provided an optimistic view for fiscal 2024. PG anticipates year-over-year all-in sales growth of 3-4% for fiscal 2024. Organic sales are likely to increase 4-5% in fiscal 2024. Procter & Gamble currently carries a Zacks Rank #2 (Buy).
Abbott Laboratories (ABT - Free Report) reported second-quarter fiscal 2023 global revenues of $9.98 billion, outpacing the Zacks Consensus Estimate by 2.9%. On an organic basis (excluding special items), sales rose 11.5% year over year in the reported quarter.
ABT projects full-year 2023 organic sales growth, excluding COVID-19 testing-related sales, in the low double digits (from the earlier projection of at least high single digits) and COVID-19 testing-related sales of around $1.5 billion.
ABT reported quarterly adjusted earnings of $1.08 per share, which topped the Zacks Consensus Estimate by 3.8%. Abbott Laboratories currently carries a Zacks Rank #2.
UnitedHealth Group Inc. (UNH - Free Report) reported third-quarter 2023 revenues of $92.4 billion, up 14.25 year over year. Revenues from UnitedHealthcare segment, rose 13% year over year to $69.9 billion on the back of a growing membership base. The reported figure outpaced the Zacks Consensus Estimate of $68.7 billion. Optum segment reported revenues of $56.7 billion, which climbed 22% year over year and beat the Zacks Consensus Estimate of $55.7 billion
UNH reported quarterly adjusted earnings per share of $6.56, which outpaced the Zacks Consensus Estimate by 3.6%. UNH expects revenues between $357 billion and $360 billion this year, the mid-point of which suggested 10.6% growth from the 2022 reported figure. UnitedHealth Group currently carries a Zacks Rank #3 (Hold).
Freeport-McMoRan Inc. (FCX - Free Report) reported second-quarter fiscal 2023 revenues of $5.737 million, up 6% year over year, surpassing the Zacks Consensus Estimate of $5,647 million. FCX reported adjusted earnings per share came in at 35 cents, beating the Zacks Consensus Estimate of 28 cents.
For 2023, FCX anticipates consolidated sales volumes to be roughly 4 billion pounds of copper. FCX also expects gold sales volumes of 1.75 million ounces for 2023. It also expects sales of 79 million pounds of molybdenum for the year. Freeport-McMoRan currently carries a Zacks Rank #3.
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5 Stocks to Watch on Solid Revenues in Last Reported Quarter
The third-quarter 2023 earnings season is currently in full swing. Although we are at the initial stage of this reporting cycle, the overall earnings picture is better than expected so far. Besides earnings, a major metric to watch in any earnings season is revenues.
Economists and financial researchers closely watch revenues as the metric defines the demand for a company’s products. Earnings can be improved through strict cost control but strong sales imply growing demand for company’s products and services. This gives investors visibility on how a company is performing under competition.
Wall Street is currently suffering from several headwinds. The Fed Chairman’s warning of tougher monetary policies for a longer-than-expected period, the recent surge in the yield of the benchmark 10-Year Treasury Note, a spike in U.S. Dollar prices and geopolitical conflicts in the Middle-East are near-term concerns.
At this juncture, companies that will be able to do good business are expected to be rewarded in stock markets.
Stocks in Focus
We have narrowed our search to five U.S. corporate behemoths that have reported strong revenue growth beside earnings beat in their last reported quarter.
The chart below shows the price performance of our five picks in the past month.
Image Source: Zacks Investment Research
JPMorgan Chase & Co. (JPM - Free Report) reported third-quarter 2023 net revenues of $39.87 billion, up 22% year over year. The top line also surpassed the Zacks Consensus Estimate of $39.14 billion. Net Interest income (NII) jumped 30% year over year to $22.73 billion. This was driven by higher rates and higher revolving balances in Card Services, partially offset by the reduction in deposit balances.
Supported by higher interest rates, the First Republic Bank deal, robust consumer and commercial banking businesses and solid loan balance JPM reported quarterly earnings per share of $4.33 handily outpacing the Zacks Consensus Estimate of $3.89.
JPM now projects NII to be roughly $88.5 billion, driven by higher rates and slower-than-expected deposit repricing across both consumers and wholesale. Earlier, the company had guided NII of $87 billion for this year.
JPMorgan Chase has an expected revenue and earnings growth rate of 10.6% and 2.8%, respectively, for the current quarter. The Zacks Consensus Estimate for current-quarter earnings has improved 2.3% over the last 30 days. JPM currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Procter & Gamble Co.’s (PG - Free Report) organic sales grew in fourth-quarter fiscal 2023, driven by robust pricing and a favorable mix, along with strength across segments. PG reported net sales of $20.553 million, up 5% year over year, surpassing the Zacks Consensus Estimate of $20,020 million.
On an organic basis (excluding special items), revenues improved 8%, backed by a 7% rise in pricing and a 2% gain from a positive product mix, offset by a 1% decline in volume. PG’s core earnings of $1.37 per share surpassed the Zacks Consensus Estimate of $1.32.
Management has provided an optimistic view for fiscal 2024. PG anticipates year-over-year all-in sales growth of 3-4% for fiscal 2024. Organic sales are likely to increase 4-5% in fiscal 2024. Procter & Gamble currently carries a Zacks Rank #2 (Buy).
Abbott Laboratories (ABT - Free Report) reported second-quarter fiscal 2023 global revenues of $9.98 billion, outpacing the Zacks Consensus Estimate by 2.9%. On an organic basis (excluding special items), sales rose 11.5% year over year in the reported quarter.
ABT projects full-year 2023 organic sales growth, excluding COVID-19 testing-related sales, in the low double digits (from the earlier projection of at least high single digits) and COVID-19 testing-related sales of around $1.5 billion.
ABT reported quarterly adjusted earnings of $1.08 per share, which topped the Zacks Consensus Estimate by 3.8%. Abbott Laboratories currently carries a Zacks Rank #2.
UnitedHealth Group Inc. (UNH - Free Report) reported third-quarter 2023 revenues of $92.4 billion, up 14.25 year over year. Revenues from UnitedHealthcare segment, rose 13% year over year to $69.9 billion on the back of a growing membership base. The reported figure outpaced the Zacks Consensus Estimate of $68.7 billion. Optum segment reported revenues of $56.7 billion, which climbed 22% year over year and beat the Zacks Consensus Estimate of $55.7 billion
UNH reported quarterly adjusted earnings per share of $6.56, which outpaced the Zacks Consensus Estimate by 3.6%. UNH expects revenues between $357 billion and $360 billion this year, the mid-point of which suggested 10.6% growth from the 2022 reported figure. UnitedHealth Group currently carries a Zacks Rank #3 (Hold).
Freeport-McMoRan Inc. (FCX - Free Report) reported second-quarter fiscal 2023 revenues of $5.737 million, up 6% year over year, surpassing the Zacks Consensus Estimate of $5,647 million. FCX reported adjusted earnings per share came in at 35 cents, beating the Zacks Consensus Estimate of 28 cents.
For 2023, FCX anticipates consolidated sales volumes to be roughly 4 billion pounds of copper. FCX also expects gold sales volumes of 1.75 million ounces for 2023. It also expects sales of 79 million pounds of molybdenum for the year. Freeport-McMoRan currently carries a Zacks Rank #3.