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Zacks Earnings Trends Highlights: Tesla, Apple and Nvidia
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For Immediate Release
Chicago, IL – May 16, 2024 – Zacks Director of Research Sheraz Mian says, "What we've seen in Q1 earnings season is a resilient and steadily improving profitability picture, both in terms of the growth rate as well as the evolving revisions trend."
Current Earnings Outlook Reflects Positivity
Note: The following is an excerpt from this week’s Earnings Trends report. You can access the full report that contains detailed historical actual and estimates for the current and following periods, please click here>>>
Here are the key points:
What we saw in the Q1 earnings season is a resilient and steadily improving profitability picture, both in terms of the growth rate as well as the evolving revisions trend. Positive revenue surprises were a bit less commonplace relative to other recent periods, but margins expanded at a better-than-expected rate.
Total earnings for the 461 S&P 500 members that have reported Q1 results are up +4.8% from the same period last year on +4.1% higher revenues, with 77.4% beating EPS estimates and 59.7% beating revenue estimates.
The earnings and revenue growth pace for these 461 index members represents a modest acceleration from what we had seen in other recent periods. The +4.8% Q1 earnings growth pace improves to +11.4% once the Energy sector and Bristol Myers’s one-time charge are accounted for.
For 2024 Q2, S&P 500 earnings are expected to be up +9.1% from the same period last year on +4.5% higher revenues. Estimates have been increasing since the start of April, with the current +9.1% earnings growth pace up from +8.7% on April 3rd.
In recent weeks, we have consistently flagged signs of improvement in the overall revisions trend, with estimates starting to go modestly up. We are seeing this trend for the current period (2024 Q2) as well as for full-year 2024 estimates.
We started seeing this favorable turn in the revisions trend roughly around when the Q1 earnings reports started coming out. That said, several sectors, including Tech and Retail, had already been enjoying positive estimate revisions for quite some time. At present, half of the 16 Zacks sectors have higher aggregate earnings estimates than expected at the start of the year.
We have recently highlighted the favorable revisions trend for the Energy sector in this space. This week, we will discuss the evolving earnings outlook for the ‘Magnificent 7’ stocks.
Please note that the $444.3 billion the group is currently expected to earn in 2024 is up from $443.9 billion last week and $438.1 billion the week prior to that.
We all know that the revisions trend for Tesla (TSLA - Free Report) has been negative for a while now, while the same for Apple (AAPL - Free Report) is also negative, though the magnitude of negative revisions for Apple is far less severe.
The revisions trend for the remaining five members of this group is positive enough to more than offset the Tesla and Apple effects. Of these five, Nvidia (NVDA - Free Report) is in a league of its own.
A big part of this year’s earnings growth is expected to come from margins reversing last year’s declines and starting to expand again. The expectation is that aggregate net margins this year get back to the 2022 level, with the Tech sector driving most of the gains.
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.
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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 https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks Earnings Trends Highlights: Tesla, Apple and Nvidia
For Immediate Release
Chicago, IL – May 16, 2024 – Zacks Director of Research Sheraz Mian says, "What we've seen in Q1 earnings season is a resilient and steadily improving profitability picture, both in terms of the growth rate as well as the evolving revisions trend."
Current Earnings Outlook Reflects Positivity
Note: The following is an excerpt from this week’s Earnings Trends report. You can access the full report that contains detailed historical actual and estimates for the current and following periods, please click here>>>
Here are the key points:
In recent weeks, we have consistently flagged signs of improvement in the overall revisions trend, with estimates starting to go modestly up. We are seeing this trend for the current period (2024 Q2) as well as for full-year 2024 estimates.
We started seeing this favorable turn in the revisions trend roughly around when the Q1 earnings reports started coming out. That said, several sectors, including Tech and Retail, had already been enjoying positive estimate revisions for quite some time. At present, half of the 16 Zacks sectors have higher aggregate earnings estimates than expected at the start of the year.
We have recently highlighted the favorable revisions trend for the Energy sector in this space. This week, we will discuss the evolving earnings outlook for the ‘Magnificent 7’ stocks.
Please note that the $444.3 billion the group is currently expected to earn in 2024 is up from $443.9 billion last week and $438.1 billion the week prior to that.
We all know that the revisions trend for Tesla (TSLA - Free Report) has been negative for a while now, while the same for Apple (AAPL - Free Report) is also negative, though the magnitude of negative revisions for Apple is far less severe.
The revisions trend for the remaining five members of this group is positive enough to more than offset the Tesla and Apple effects. Of these five, Nvidia (NVDA - Free Report) is in a league of its own.
A big part of this year’s earnings growth is expected to come from margins reversing last year’s declines and starting to expand again. The expectation is that aggregate net margins this year get back to the 2022 level, with the Tech sector driving most of the gains.
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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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 https://www.zacks.com/performance for information about the performance numbers displayed in this press release.