Another hectic week of the second-quarter earnings season is drawing to an end, with 414 S&P 500 members releasing their results. Roughly 83% of the total S&P 500 index members have released their second-quarter results through Aug 4. Following the disappointing trend set in other recent quarters, growth continues to remain elusive. The second quarter is expected to be the fifth in a row to suffer an earnings decline for the benchmark index. Having said that, the pace of decline is seen to be moderating from prior periods.

Per the latest Earnings Trends report, 414 S&P 500 companies have reported their second-quarter earnings so far with 70.5% topping bottom-line estimates and 52.9% coming in ahead of top-line expectations. The overall report suggests that earnings results have moved south 4.5%, on a 1% decline in revenues from the same period last year.

The Energy sector has been a major drag this earnings season, with earnings down 76.9% on a 24.4% fall in revenues from the prior-year period. If we keep aside the Energy sector, S&P 500 earnings would have moved south 0.7% from the same period last year, on 2.3% higher revenue.

So far, the reporting cycle for four sectors, namely, Autos, Conglomerates, Business Services and Transportation have come to an end, while most of the other sectors are also close to finishing. Eight out of 16 Zacks sectors are seeing growth in negative territory in Q2, with Energy, Basic Materials, Aerospace and Transportation suffering double-digit declines. However, Autos, Construction, Conglomerates, Utilities, Medical, Retail, Consumer Discretionary and Business Services – eight in all – have reasons to cheer, booking growth this season. Although other sector earnings are almost over, the Retail sector still awaits a large chunk of its results.  

The Business Services sector is looking reasonably good. For the sector, earnings are expected to grow 6%, while sales are touted to rise 7.3% over last year. The projected improvement is largely due to a recovery in oil prices in the second quarter and the faded effects of the dollar strength.

Let’s have a sneak peek at four major industry players to see how things are gearing up for the upcoming quarterly results.

Ritchie Bros. Auctioneers Incorporated (RBA Quick QuoteRBA - Free Report) is scheduled to report second-quarter results after market close on Aug 8. The company is known for their innovative auction methods, attention to detail and their total commitment to the unreserved auction.

As per our model, a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) for it to beat estimates. For the quarter to be reported, this Zacks Rank #4 (Sell) stock has an Earnings ESP of 0.00%. As it is, we caution against Sell-rated stocks (#4 and #5) going into the earnings release.

Over the trailing four quarters, the company has, however, beaten estimates thrice, with an average positive surprise of 14.07%.

Convergys Corporation is scheduled to report second-quarter results after market close on Aug 8. The company offers customer management services to communications and media, technology, financial services, retail, and healthcare industries across North America and globally. For the quarter to be reported, this Zacks Rank #3 stock has an Earnings ESP of 0.00%, thus making an earnings prediction uncertain. Over the trailing four quarters, the company beat estimates thrice, with an average surprise of 2.65%.

Sotheby's is scheduled to report second-quarter results before market open on Aug 8. It is one of the world's second largest auctioneers of fine arts, antiques and collectibles, offering property in collecting categories like paintings, jewelry, decorative arts, and books. For the quarter to be reported, this Zacks Rank #3 stock has an Earnings ESP of 0.00%, thus making an earnings prediction uncertain. Over the trailing four quarters, the company missed estimates twice, with a negative average surprise of 16.95%.

Envestnet, Inc. (ENV Quick QuoteENV - Free Report) is scheduled to report second-quarter results after market close on Aug 8. The company is an independent provider of technology-enabled, Web-based investment solutions and services to financial advisors. For the quarter to be reported, this Zacks Rank #2 stock has an Earnings ESP of 0.00%, thus making an earnings prediction uncertain. Over the trailing four quarters, the company missed estimates by a large margin in one quarter, bringing the average surprise to a negative 13.47%.

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