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Zacks Investment Ideas feature highlights: Meta and Apple
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For Immediate Release
Chicago, IL – October 28, 2024 – Today, Zacks Investment Ideas feature highlights Meta Platforms (META - Free Report) and Apple (AAPL - Free Report) .
Mag 7 Earnings: Meta and Apple in Focus
Earnings season has picked up notable steam over the last week, with a nice variety of companies delivering quarterly results. The Q3 cycle looks to be positive, underpinned by another robust showing from technology.
And next week, we have several Mag 7 members on the reporting docket, a list that includes but is not limited to Meta Platforms and Apple.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Currently, the Magnificent 7 group as a whole is expected to post 16.2% earnings growth on 13.6% higher sales.
Let’s take a closer look at individual expectations for Meta Platforms and Apple.
META Shares Continue Outperformance
META shares have been notably strong in 2024, reflecting one of the top Mag 7 performers overall in 2024. While other members have seen their shares primarily trade sideways over recent months, bullish sentiment has remained for the stock leading up to its quarterly release.
Earnings expectations for the quarter to be reported have remained positive since the beginning of August, with the $5.17 Zacks Consensus EPS estimate up 2% since and suggesting 18% growth year-over-year. Positive earnings estimate revisions have landed the stock into a favorable Zacks Rank #2 (Buy).
Revenue revisions have followed a similar trajectory, with the company expected to see 17% sales growth from the year-ago period. As usual, the company’s advertising performance will be a focal point, which has performed strongly over recent periods partly thanks to the implementation of AI capabilities.
Advertising results have consistently beaten our consensus expectations, with the company stringing together six consecutive positive surprises.
Investors should expect to hear further commentary surrounding its AI roadmap, particularly on the capital expenditures (CapEx) side of things. The valuation picture heading into the release isn’t concerning, with the current 23.7X forward 12-month earnings multiple not too far off from the 22.1X five-year median and well beneath five-year highs of 31.5X.
In addition, the current PEG works out to 1.2X, again in line with historical averages and a fraction of the 2.9X five-year high.
Apple's AI Efforts in Focus
Expectations for Apple’s upcoming release have reflected slight bearishness, with downward revisions recently hitting the tape near the beginning of October. Modest growth is forecasted, with the current $1.54 Zacks Consensus EPS estimate suggesting a 5% climb year-over-year.
A key item to keep an eye on during the upcoming release is the company’s iPhone results, which generally always take center stage. Investors should expect a decent bit of commentary surrounding the new iPhone 16 and the upcoming AI capabilities that the company has been touting over recent months.
iPhone results have exceeded our consensus expectations in two of its last three quarterly releases.
The valuation picture here is slightly stretched, with the current forward 12-month earnings multiple of 30.3X well above the 26.3X five-year median but beneath five-year highs of 36.1X.
And the current PEG works out to 2.4X, again above the 2.2X five-year median. While valuation multiples may be a bit steep, investors have had little issue paying a premium for shares given the company’s rock-solid fundamentals.
Bottom Line
We’ve got several notable companies on the reporting docket for next week, who will help kick off the reporting cycle for the broader Mag 7 group.
Investors should keep a close watch on META’s commentary surrounding CapEx, with Advertising results again expected to be a focal point. Earnings estimate revisions have been favorable heading into the release, with valuation multiples sitting fairly as well.
Concerning Apple, the big highlight will be iPhone results, with extensive commentary expected surrounding the previously announced AI capabilities.
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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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Zacks Investment Ideas feature highlights: Meta and Apple
For Immediate Release
Chicago, IL – October 28, 2024 – Today, Zacks Investment Ideas feature highlights Meta Platforms (META - Free Report) and Apple (AAPL - Free Report) .
Mag 7 Earnings: Meta and Apple in Focus
Earnings season has picked up notable steam over the last week, with a nice variety of companies delivering quarterly results. The Q3 cycle looks to be positive, underpinned by another robust showing from technology.
And next week, we have several Mag 7 members on the reporting docket, a list that includes but is not limited to Meta Platforms and Apple.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Currently, the Magnificent 7 group as a whole is expected to post 16.2% earnings growth on 13.6% higher sales.
Let’s take a closer look at individual expectations for Meta Platforms and Apple.
META Shares Continue Outperformance
META shares have been notably strong in 2024, reflecting one of the top Mag 7 performers overall in 2024. While other members have seen their shares primarily trade sideways over recent months, bullish sentiment has remained for the stock leading up to its quarterly release.
Earnings expectations for the quarter to be reported have remained positive since the beginning of August, with the $5.17 Zacks Consensus EPS estimate up 2% since and suggesting 18% growth year-over-year. Positive earnings estimate revisions have landed the stock into a favorable Zacks Rank #2 (Buy).
Revenue revisions have followed a similar trajectory, with the company expected to see 17% sales growth from the year-ago period. As usual, the company’s advertising performance will be a focal point, which has performed strongly over recent periods partly thanks to the implementation of AI capabilities.
Advertising results have consistently beaten our consensus expectations, with the company stringing together six consecutive positive surprises.
Investors should expect to hear further commentary surrounding its AI roadmap, particularly on the capital expenditures (CapEx) side of things. The valuation picture heading into the release isn’t concerning, with the current 23.7X forward 12-month earnings multiple not too far off from the 22.1X five-year median and well beneath five-year highs of 31.5X.
In addition, the current PEG works out to 1.2X, again in line with historical averages and a fraction of the 2.9X five-year high.
Apple's AI Efforts in Focus
Expectations for Apple’s upcoming release have reflected slight bearishness, with downward revisions recently hitting the tape near the beginning of October. Modest growth is forecasted, with the current $1.54 Zacks Consensus EPS estimate suggesting a 5% climb year-over-year.
A key item to keep an eye on during the upcoming release is the company’s iPhone results, which generally always take center stage. Investors should expect a decent bit of commentary surrounding the new iPhone 16 and the upcoming AI capabilities that the company has been touting over recent months.
iPhone results have exceeded our consensus expectations in two of its last three quarterly releases.
The valuation picture here is slightly stretched, with the current forward 12-month earnings multiple of 30.3X well above the 26.3X five-year median but beneath five-year highs of 36.1X.
And the current PEG works out to 2.4X, again above the 2.2X five-year median. While valuation multiples may be a bit steep, investors have had little issue paying a premium for shares given the company’s rock-solid fundamentals.
Bottom Line
We’ve got several notable companies on the reporting docket for next week, who will help kick off the reporting cycle for the broader Mag 7 group.
Investors should keep a close watch on META’s commentary surrounding CapEx, with Advertising results again expected to be a focal point. Earnings estimate revisions have been favorable heading into the release, with valuation multiples sitting fairly as well.
Concerning Apple, the big highlight will be iPhone results, with extensive commentary expected surrounding the previously announced AI capabilities.
Why Haven't You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
See Stocks Free >>
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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.