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Apple and Facebook are part of Zacks Earnings Preview
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For Immediate Release
Chicago, IL – October 30, 2017 – Zacks.com releases the list of companies likely to issue earnings surprises. This week’s list includes Apple (AAPL - Free Report) and Facebook .
We are past the halfway mark in the Q3 earnings season, with results from 54% of the S&P 500 members already out. This reporting season has turned out to be very good, further strengthening the narrative of a favorable earnings backdrop that has been in place over the last few quarters.
The Technology sector became the latest to come out with impressive Q3 results, which will likely get reconfirmed with this week’s results from Apple and Facebook. In total, we have almost 900 companies on deck to release results this week, including 134 S&P 500 members. By the end of this week, we will have seen Q3 results from more than 80% of S&P 500 members. Unlike the large-cap stocks in the S&P 500 index, we are still at a relatively early stage in the small-cap reporting cycle. As of Friday, October 27th, we have seen results from almost 31% of the small-cap S&P 600 members, with the reporting tally crossing the halfway mark by the end of this week.
Let me make a quick comment about expectations from Apple and Facebook before highlighting four points about the Q3 earnings season as a whole.
Apple shares have regained the ground they lost following the latest iPhone announcement in September, but there is plenty of uncertainty in the market about the outlook for the higher-end iPhone X. The stock is now up +40.1% in the year-to-date period vs. +22.5% gain for the Zack Tech sector and +14.2% gain for the S&P 500 index. This strong year-to-date performance notwithstanding, the stock has lagged the sector as well as the broader market since the September 12th product announcement.
The company is expected to earn $1.86 per share on $51.17 billion, up from $1.66 per share on $46.56 billion in the year-earlier period. The company has handily beaten estimates in each of the last three quarters. More than EPS and revenue surprises, the key metric for the market will be iPhone shipments with the Zacks Consensus estimate of 46.42 million units in the period, which will be up from 45.5 million units shipped in the year-earlier quarter.
Apple will report Q3 results after the market’s close on Thursday, November 2nd.
Facebook shares have been star performers this year, with the sock up +54.3% vs. +22.5% gain for the Zacks Tech sector and +14.2% gain for the S&P 500 index. Facebook is scheduled to report results after the market’s close on Wednesday November 1st, with the company expected to earn $1.30 per share on $9.88 billion in revenues, up +19.5% and +40.9% from the year-earlier level, respectively.
Performance in terms of advertising revenue and active users will be even more material for the stock price than revenues and EPS. The expectation is for ad revenues of $9.71 billion (up from $6.8 billion in the year-earlier period) and daily active users tally of 1.371 billion (up from 1.179 billion in 2016 Q3).
About the Zacks Rank
Since 1988, the Zacks Rank has proven that "Earnings estimate revisions are the most powerful force impacting stock prices." Since inception in 1988, #1 Rank stocks have generated an average annual return of +28%. During the 2000-2002 bear market, Zacks #1 Rank stocks gained +43.8%, while the S&P 500 tumbled -37.6%. Also note that the Zacks Rank system has just as many Strong Sell recommendations (Rank #5) as Strong Buy recommendations (Rank #1). Since 1988, Zacks Rank #5 stocks have significantly underperformed the S&P 500 (+3% versus +10%). Thus, the Zacks Rank system allows investors to truly manage portfolio trading effectively.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
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 http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
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Apple and Facebook are part of Zacks Earnings Preview
For Immediate Release
Chicago, IL – October 30, 2017 – Zacks.com releases the list of companies likely to issue earnings surprises. This week’s list includes Apple (AAPL - Free Report) and Facebook .
To see more earnings analysis, visit http://at.zacks.com/?id=3207.
All-Around Strength in Q3 Earnings Season
We are past the halfway mark in the Q3 earnings season, with results from 54% of the S&P 500 members already out. This reporting season has turned out to be very good, further strengthening the narrative of a favorable earnings backdrop that has been in place over the last few quarters.
The Technology sector became the latest to come out with impressive Q3 results, which will likely get reconfirmed with this week’s results from Apple and Facebook. In total, we have almost 900 companies on deck to release results this week, including 134 S&P 500 members. By the end of this week, we will have seen Q3 results from more than 80% of S&P 500 members. Unlike the large-cap stocks in the S&P 500 index, we are still at a relatively early stage in the small-cap reporting cycle. As of Friday, October 27th, we have seen results from almost 31% of the small-cap S&P 600 members, with the reporting tally crossing the halfway mark by the end of this week.
Let me make a quick comment about expectations from Apple and Facebook before highlighting four points about the Q3 earnings season as a whole.
Apple shares have regained the ground they lost following the latest iPhone announcement in September, but there is plenty of uncertainty in the market about the outlook for the higher-end iPhone X. The stock is now up +40.1% in the year-to-date period vs. +22.5% gain for the Zack Tech sector and +14.2% gain for the S&P 500 index. This strong year-to-date performance notwithstanding, the stock has lagged the sector as well as the broader market since the September 12th product announcement.
The company is expected to earn $1.86 per share on $51.17 billion, up from $1.66 per share on $46.56 billion in the year-earlier period. The company has handily beaten estimates in each of the last three quarters. More than EPS and revenue surprises, the key metric for the market will be iPhone shipments with the Zacks Consensus estimate of 46.42 million units in the period, which will be up from 45.5 million units shipped in the year-earlier quarter.
Apple will report Q3 results after the market’s close on Thursday, November 2nd.
Facebook shares have been star performers this year, with the sock up +54.3% vs. +22.5% gain for the Zacks Tech sector and +14.2% gain for the S&P 500 index. Facebook is scheduled to report results after the market’s close on Wednesday November 1st, with the company expected to earn $1.30 per share on $9.88 billion in revenues, up +19.5% and +40.9% from the year-earlier level, respectively.
Performance in terms of advertising revenue and active users will be even more material for the stock price than revenues and EPS. The expectation is for ad revenues of $9.71 billion (up from $6.8 billion in the year-earlier period) and daily active users tally of 1.371 billion (up from 1.179 billion in 2016 Q3).
About the Zacks Rank
Since 1988, the Zacks Rank has proven that "Earnings estimate revisions are the most powerful force impacting stock prices." Since inception in 1988, #1 Rank stocks have generated an average annual return of +28%. During the 2000-2002 bear market, Zacks #1 Rank stocks gained +43.8%, while the S&P 500 tumbled -37.6%. Also note that the Zacks Rank system has just as many Strong Sell recommendations (Rank #5) as Strong Buy recommendations (Rank #1). Since 1988, Zacks Rank #5 stocks have significantly underperformed the S&P 500 (+3% versus +10%). Thus, the Zacks Rank system allows investors to truly manage portfolio trading effectively.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.
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Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
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 http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.