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After a tough start to the year, the S&P 500 topped the 4,900 milestone for the first time in the latest trading session. This week is packed with more than 100 corporate earnings, a Federal Reserve policy meeting and the job report data that may dictate the next moves for the market’s rally.
Key Earnings Releases
Five of the "Magnificent Seven" tech companies are set to report earnings, with Microsoft (MSFT - Free Report) and Alphabet (GOOGL - Free Report) , (GOOG - Free Report) leading the pack on Jan 30. Apple (AAPL - Free Report) , Amazon (AMZN - Free Report) and Meta Platforms META will report on Feb 1. Outside the tech sector, General Motors (GM - Free Report) and United Parcel (UPS - Free Report) are among the well-known companies set to release results before the bell on Jan 30, while Starbucks (SBUX - Free Report) will report after market close.
Microsoft
Microsoft has an Earnings ESP of 0.00% and a Zacks Rank #2 (Buy). According to our methodology, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Microsoft saw a positive earnings estimate revision of a penny over the past 30 days for the to-be-reported quarter. Analysts increasing estimates right before earnings — with the most up-to-date information possible — is a good indicator for a stock. The Zacks Consensus Estimate indicates earnings growth of 18.9% and modest revenue growth of 15.7% from the year-ago quarter. Microsoft’s earnings track record is impressive, with the four-quarter earnings surprise being 7.83%, on average. Microsoft has gained 14.5% over the past three months and has a solid Growth Score of A (read: Microsoft Tops Apple Ahead of Q4 Earnings: 5 ETFs to Invest).
Select Sector SPDR Technology ETF (XLK - Free Report) and MSCI Information Technology Index ETFFTEC have the largest exposure of more than 20% each in Microsoft.
Alphabet
Alphabet has an Earnings ESP of +2.26% and a Zacks Rank #3. It saw a positive earnings estimate revision of a penny over the past 30 days for the to-be-reported quarter. The company’s earnings surprise track record over the past four quarters is good, with the average being 4.62%. Earnings are expected to increase 52.4%, while revenues are expected to grow 12% from the year-ago quarter. Alphabet has a Growth Score of A and has risen 18% in the past three months.
Communication Services Select Sector SPDR FundXLC and iShares Global Comm Services ETFIXP have 12.6% exposure in Alphabet.
Meta Platforms
Meta Platforms has an Earnings ESP of +0.51% and Zacks Rank #2. The social media giant saw a positive earnings estimate revision of 4 cents for the to-be-reported quarter over the past 30 days. The current Zacks Consensus Estimate for the yet-to-be-reported quarter indicates year-over-year earnings growth of 61.3% and revenue growth of 21%. Meta Platforms delivered an earnings surprise of 27.50%, on average, in the last four quarters. The stock has a solid Growth Score of A and has surged about 25% over the past three months.
Amazon
Amazon has an Earnings ESP of -0.04% and a Zacks Rank #2. The stock saw a positive earnings estimate revision of a couple of cents over the past 30 days for the fourth quarter. The Zacks Consensus Estimate indicates a whopping year-over-year earnings increase of 285.7% and substantial revenue growth of 11.4% for the to-be-reported quarter. Additionally, Amazon’s earnings surprise history is impressive, with the four-quarter average surprise being 54.87%. The stock has a solid Growth Score of A and has returned 15% in the past three months.
Communication Services Select Sector SPDR FundXLC and Fidelity MSCI Communication Services Index ETFFCOM have at least 23% exposure each in Amazon.
Apple
Apple has an Earnings ESP of +1.96% and a Zacks Rank #3. Apple saw a positive earnings estimate revision of a penny over the past 30 days for the fiscal fourth quarter. The iPhone maker has a strong track record of positive earnings surprises. It delivered an average earnings surprise of 3.47% in the trailing four quarters. The Zacks Consensus Estimate indicates a modest year-over-year increase of 11.2% for earnings and 0.4% for revenues. Apple is up 9% over the past three months.
General Motors has an Earnings ESP of +1.78% and Zacks Rank #2. It saw a positive earnings estimate revision of 7 cents over the past 30 days for the to-be-reported quarter. The company’s earnings surprise track record over the past four quarters is good, with the average being 23.82%, on average. Earnings and revenues are expected to decline 49% and 5.4%, respectively, from the year-ago quarter. General Motors has a solid Momentum Score of A and has climbed 18% in the past three months.
United Parcel has an Earnings ESP of +1.69% and a Zacks Rank #3. The courier company saw a negative earnings estimate revision of a penny for the to-be-reported quarter over the past 30 days. The current Zacks Consensus Estimate for the yet-to-be-reported quarter indicates a year-over-year earnings decline of 32.6% and a revenue decline of 6.4%. United Parcel delivered an earnings surprise of 27.50%, on average, in the last four quarters. The stock has a solid Momentum Score of A and has gained about 11% over the past three months.
iShares US Transportation ETF (IYT - Free Report) has a substantial 11.2% exposure in UPS.
Fed Meet
Fed Chair Jerome Powell is expected to hold rates steady in the range of 5.25% to 5.5%. According to the CME FedWatch tool, the fed funds futures market has priced in an approximately 97% probability that the central bank will leave rates unchanged during its Wednesday announcement and there’s a 48% probability of a rate cut at the next meeting in March. If the Fed signals a possible rate cut in March, the U.S. dollar will likely weaken against all major currencies. As such, Invesco DB US Dollar Index Bullish Fund (UUP - Free Report) and WisdomTree Bloomberg U.S. Dollar Bullish Fund (USDU - Free Report) might experience some declines. These two ETFs are the prime beneficiaries of the rising dollar.
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ETFs to Watch This Earnings-Packed Week
After a tough start to the year, the S&P 500 topped the 4,900 milestone for the first time in the latest trading session. This week is packed with more than 100 corporate earnings, a Federal Reserve policy meeting and the job report data that may dictate the next moves for the market’s rally.
Key Earnings Releases
Five of the "Magnificent Seven" tech companies are set to report earnings, with Microsoft (MSFT - Free Report) and Alphabet (GOOGL - Free Report) , (GOOG - Free Report) leading the pack on Jan 30. Apple (AAPL - Free Report) , Amazon (AMZN - Free Report) and Meta Platforms META will report on Feb 1. Outside the tech sector, General Motors (GM - Free Report) and United Parcel (UPS - Free Report) are among the well-known companies set to release results before the bell on Jan 30, while Starbucks (SBUX - Free Report) will report after market close.
Microsoft
Microsoft has an Earnings ESP of 0.00% and a Zacks Rank #2 (Buy). According to our methodology, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Microsoft saw a positive earnings estimate revision of a penny over the past 30 days for the to-be-reported quarter. Analysts increasing estimates right before earnings — with the most up-to-date information possible — is a good indicator for a stock. The Zacks Consensus Estimate indicates earnings growth of 18.9% and modest revenue growth of 15.7% from the year-ago quarter. Microsoft’s earnings track record is impressive, with the four-quarter earnings surprise being 7.83%, on average. Microsoft has gained 14.5% over the past three months and has a solid Growth Score of A (read: Microsoft Tops Apple Ahead of Q4 Earnings: 5 ETFs to Invest).
Select Sector SPDR Technology ETF (XLK - Free Report) and MSCI Information Technology Index ETF FTEC have the largest exposure of more than 20% each in Microsoft.
Alphabet
Alphabet has an Earnings ESP of +2.26% and a Zacks Rank #3. It saw a positive earnings estimate revision of a penny over the past 30 days for the to-be-reported quarter. The company’s earnings surprise track record over the past four quarters is good, with the average being 4.62%. Earnings are expected to increase 52.4%, while revenues are expected to grow 12% from the year-ago quarter. Alphabet has a Growth Score of A and has risen 18% in the past three months.
Communication Services Select Sector SPDR Fund XLC and iShares Global Comm Services ETF IXP have 12.6% exposure in Alphabet.
Meta Platforms
Meta Platforms has an Earnings ESP of +0.51% and Zacks Rank #2. The social media giant saw a positive earnings estimate revision of 4 cents for the to-be-reported quarter over the past 30 days. The current Zacks Consensus Estimate for the yet-to-be-reported quarter indicates year-over-year earnings growth of 61.3% and revenue growth of 21%. Meta Platforms delivered an earnings surprise of 27.50%, on average, in the last four quarters. The stock has a solid Growth Score of A and has surged about 25% over the past three months.
Amazon
Amazon has an Earnings ESP of -0.04% and a Zacks Rank #2. The stock saw a positive earnings estimate revision of a couple of cents over the past 30 days for the fourth quarter. The Zacks Consensus Estimate indicates a whopping year-over-year earnings increase of 285.7% and substantial revenue growth of 11.4% for the to-be-reported quarter. Additionally, Amazon’s earnings surprise history is impressive, with the four-quarter average surprise being 54.87%. The stock has a solid Growth Score of A and has returned 15% in the past three months.
Communication Services Select Sector SPDR Fund XLC and Fidelity MSCI Communication Services Index ETF FCOM have at least 23% exposure each in Amazon.
Apple
Apple has an Earnings ESP of +1.96% and a Zacks Rank #3. Apple saw a positive earnings estimate revision of a penny over the past 30 days for the fiscal fourth quarter. The iPhone maker has a strong track record of positive earnings surprises. It delivered an average earnings surprise of 3.47% in the trailing four quarters. The Zacks Consensus Estimate indicates a modest year-over-year increase of 11.2% for earnings and 0.4% for revenues. Apple is up 9% over the past three months.
Vanguard Information Technology ETF VGT and Select Sector SPDR Technology ETF (XLK - Free Report) have the largest exposure of at least 21% each in Apple (read: Tech Leads S&P 500 to Highs: Does Further Rally Await ETFs?).
General Motors
General Motors has an Earnings ESP of +1.78% and Zacks Rank #2. It saw a positive earnings estimate revision of 7 cents over the past 30 days for the to-be-reported quarter. The company’s earnings surprise track record over the past four quarters is good, with the average being 23.82%, on average. Earnings and revenues are expected to decline 49% and 5.4%, respectively, from the year-ago quarter. General Motors has a solid Momentum Score of A and has climbed 18% in the past three months.
First Trust Nasdaq Transportation ETF FTXR has the largest exposure of 8.2% in General Motors (read: 5 Top-Ranked Beaten-Down ETFs to Rebound in 2024).
United Parcel Service
United Parcel has an Earnings ESP of +1.69% and a Zacks Rank #3. The courier company saw a negative earnings estimate revision of a penny for the to-be-reported quarter over the past 30 days. The current Zacks Consensus Estimate for the yet-to-be-reported quarter indicates a year-over-year earnings decline of 32.6% and a revenue decline of 6.4%. United Parcel delivered an earnings surprise of 27.50%, on average, in the last four quarters. The stock has a solid Momentum Score of A and has gained about 11% over the past three months.
iShares US Transportation ETF (IYT - Free Report) has a substantial 11.2% exposure in UPS.
Fed Meet
Fed Chair Jerome Powell is expected to hold rates steady in the range of 5.25% to 5.5%. According to the CME FedWatch tool, the fed funds futures market has priced in an approximately 97% probability that the central bank will leave rates unchanged during its Wednesday announcement and there’s a 48% probability of a rate cut at the next meeting in March. If the Fed signals a possible rate cut in March, the U.S. dollar will likely weaken against all major currencies. As such, Invesco DB US Dollar Index Bullish Fund (UUP - Free Report) and WisdomTree Bloomberg U.S. Dollar Bullish Fund (USDU - Free Report) might experience some declines. These two ETFs are the prime beneficiaries of the rising dollar.