Stephen Schwarzman, CEO and Co-Founder of Blackstone Group, attends the 55th annual World Economic Forum (WEF) meeting in Davos, Switzerland, January 23, 2025. REUTERS/Yves Herman/File Photo Purchase Licensing Rights, opens new tab
CompaniesNEW YORK, July 23 (Reuters) - Blackstone (BX.N), opens new tab is working to address the societal and environmental implications of artificial intelligence development, CEO Stephen Schwarzman said on Thursday, as opposition to data center construction mounts in the U.S.
Blackstone, opens new tab and other private capital firms are pouring tens of billions of dollars into businesses and infrastructure that aim to increase compute capacity and run power-hungry models.
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But the otherwise deeply divided American electorate is united across party lines when confronted by the pace of data center construction, and only 14% would support one being built in their community for technology firms, according to a June Reuters/Ipsos poll.
Blackstone is working closely with portfolio companies including data-center businesses "to address the workforce, environmental and community implications of development through the creation of union jobs, workforce training, water-free cooling systems, expanded power generation and significant local economic investment," Schwarzman said on a conference call.
While the impact of AI could echo the industrial revolution, which eventually raised living standards, Schwarzman said, "Major change of this type also creates anxiety due to the uncertainty of how the technology will evolve."
Data-center operator QTS, which Blackstone took private for $10 billion in 2021, said earlier this month that it had terminated a project in Virginia after years of planning. The project had faced strong local opposition and litigation, despite being approved by county authorities.
U.S. President Donald Trump's administration sees AI development as a race against China, but is also working to shield households from an attendant rise in energy costs.
Schwarzman, a longtime Trump donor, said he had personally been "spending a lot of time with leaders in the industry and various policymakers thinking about how to address these critical issues, while also preserving the advance of America's AI leadership."
Reporting by Isla Binnie; Editing by Nia Williams
Our Standards: The Thomson Reuters Trust Principles., opens new tab
Isla Binnie reports on how company directors and executives manage stakeholder and shareholder interests, with a focus on compensation, corporate crises, dealmaking and succession. She also covers how politics, regulation, environmental issues and the broader economy affect boardroom discussions. Isla previously covered business, politics and general news in Spain and Italy. She trained with Reuters in London and covered emerging markets debt for the International Financing Review (IFR).
Basil writes stories across the U.S. finance file including banks, asset managers, payment firms, insurers, and exchange operators. He also covers initial public offerings on U.S. exchanges and venture capital funding.
AI Consolidation Begins: Blackstone & Google Forge an AI EmpireBlackstone NYSE: BX reported sharply higher second-quarter 2026 earnings as executives said the firm’s early and aggressive positioning around artificial intelligence infrastructure is driving investment performance, fundraising and new business formation across the platform.
Weston Tucker, Blackstone’s Head of Shareholder Relations, said the firm reported GAAP net income of $2.4 billion for the quarter. Distributable earnings were $2 billion, or $1.52 per common share, and Blackstone declared a dividend of $1.29 per share, payable to holders of record as of August 3.
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As Broadcom Eclipses $2 Trillion, Private Credit Giants Wants InChairman and CEO Steve Schwarzman said distributable earnings rose 26% year-over-year, while fee-related earnings increased 22% and net realizations rose 27%. Total inflows reached nearly $70 billion in the quarter and more than $260 billion over the last 12 months, bringing assets under management to a record $1.35 trillion, up 11% from a year earlier.
AI Infrastructure Remains Central to Blackstone’s Strategy Schwarzman said the largest driver of Blackstone’s recent momentum has been its investments in AI-related areas, including data centers, energy and power, and private AI companies. He said Blackstone has become “one of the largest private capital providers in the AI ecosystem,” giving investors access to opportunities that often cannot be replicated in public markets.
Sony's $4 Billion Bet on Rock & Roll RoyaltiesDuring the quarter, Schwarzman highlighted four AI-related initiatives. Blackstone teamed with Google to build a new AI cloud provider using Google’s TPU chips, with an initial investment of up to $5 billion. The firm also partnered with Anthropic to form a company focused on enterprise adoption of AI-powered solutions. In credit, Blackstone joined Broadcom and another manager to create a financing platform to support Broadcom’s deployment of large-scale AI compute for end customers, providing $35 billion initially for 1 gigawatt of compute. The company also launched BXDC, a Blackstone REIT designed to acquire stabilized, newly built data centers, in a $2 billion offering that Schwarzman described as the largest blind-pool REIT IPO in history.
Blackstone’s data center platform has grown to $185 billion of total value, including facilities under construction, up from $130 billion at the start of the year. Schwarzman said the firm expects to lease more than three times as much capacity this year as in any prior year in its history. He also said the platform could double over the next few years if Blackstone executes on its pipeline.
Executives acknowledged risks around AI. Schwarzman said Blackstone is mindful of “excessive exuberance” and is focusing on risk-adjusted returns and downside protection. He also discussed workforce, environmental and community considerations tied to data center development, including union jobs, workforce training, water-free cooling systems and expanded power generation.
Fundraising Broad-Based Across Institutions, Insurance and Wealth President and COO Jon Gray said Blackstone’s clients are responding to performance with strong inflows across institutions, insurance companies and individual investors, which he called the firm’s “three I’s.”
In infrastructure, Gray said AUM grew 40% year-over-year to $90 billion, supported by investments in digital and energy infrastructure. He said the commingled BIP strategy has generated an 18% net annual return since inception.
Gray also said Blackstone’s Multi-Asset Investing business, BXMA, reached a record $109 billion of AUM, up 21% year-over-year, and delivered 25 consecutive quarters of positive returns for its largest strategy. After the quarter ended, BXMA recorded $4.8 billion of monthly inflows on July 1, which Gray said was its best single month of fundraising.
In institutional drawdown funds, Gray said three strategies reached their hard caps so far in 2026: opportunistic private credit, life sciences and Asia private equity. He said Blackstone expects its new private equity energy transition flagship to reach its hard cap soon as well. Together, those four strategies represent nearly $40 billion.
Blackstone’s Asia private equity flagship closed at $13.1 billion in the quarter, more than double the prior vintage, backed by a 27% net annual return in the previous fund since inception. Gray said Blackstone’s focus on India and Japan has been a key driver of that performance.
Credit and Insurance Platforms Continue to Expand Gray said Blackstone’s combined corporate and real estate credit platform grew to nearly $550 billion, up 13% year-over-year, with $33 billion of inflows in the quarter. Credit represented nearly half of total firm inflows.
He said Blackstone is benefiting from a secular shift toward investment-grade private credit, particularly in insurance. Insurance AUM reached $290 billion, up 15% year-over-year. Gray highlighted a new partnership with Nippon Life, Japan’s largest life insurer, under which Blackstone expects to deploy approximately $10 billion in private credit over the next several years and invest in Nippon Life’s domestic real estate portfolio.
During the question-and-answer session, Gray said insurers are increasingly using private investment-grade credit to compete, because it can provide higher returns at similar or higher ratings levels. He said Blackstone now has 40 clients in its dedicated insurance solutions area, nearly double the number from two years ago, and emphasized that the firm operates with an open architecture model without taking on insurance liabilities.
Private Wealth Growth Offsets BCRED Redemptions Blackstone’s private wealth AUM grew 16% year-over-year to a record $324 billion. Gray said total sales were $8.6 billion in the quarter, with slower activity in April and May amid geopolitical concerns but a strong recovery in June that continued into the third quarter.
BXPE raised $2.4 billion in the quarter, bringing its NAV to more than $25 billion after 10 quarters. Gray said its largest share class has produced a 20% net annualized return since inception, including approximately 8% net in the second quarter. BXINFRA raised about $900 million, bringing its NAV to $6 billion after six quarters.
BREIT raised $1.2 billion, while repurchase requests declined 42% year-over-year and 33% sequentially from the first quarter. Gray said that produced the vehicle’s best “regular way” net flows in nearly four years, adding that BREIT is “clearly back in growth mode.”
BCRED saw $1 billion of gross sales, but repurchase requests exceeded its 5% limit, with roughly 50% fulfilled, leading to net outflows of $1.2 billion. Gray said early third-quarter redemption requests were down materially and attributed the improvement partly to a reduction in negative market commentary around private credit.
Executives Point to IPO Market and Realizations CFO Michael Chae said fee-related earnings rose 22% year-over-year to $1.8 billion, or $1.43 per share. Fee revenues increased 22% to $3 billion, with growth across all four segments: private equity, real estate, BXMA and credit. Transaction and advisory fees nearly doubled year-over-year to a record $321 million.
Chae said net realizations were $414 million, up 27% year-over-year, helped by dispositions including a data center sale and multiple energy portfolio realizations. He said Blackstone’s net accrued performance revenue stood at $7.5 billion, or $6 per share, the highest level in four years.
Executives said the IPO market has strengthened. Gray noted that U.S. IPO activity increased sixfold in the first half of 2026 compared with the same period last year, while global issuance rose more than three-and-a-half-fold. Blackstone has executed three IPOs since May and has eight IPOs on file globally.
Chae said Blackstone expects net realizations to slow sequentially in the third quarter but anticipates a robust fourth quarter and 2027. He also said the firm expects base management fee growth to return to double digits in 2027, supported by drawdowns in private equity funds, growth in perpetual strategies, credit deployment and stabilization in real estate fee trends.
About Blackstone (NYSE:BX)Blackstone Inc NYSE: BX is a global investment firm focused on alternative asset management. Founded in 1985 by Stephen A. Schwarzman and Peter G. Peterson and headquartered in New York City, the firm organizes and manages investment vehicles that acquire and operate businesses, real estate and credit investments, as well as provide hedge fund solutions and other alternative strategies for institutional and individual investors.
Blackstone's business is organized around several principal investment platforms.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
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Key Takeaways CAKE may see Q2 gains from openings, menu innovation and stronger digital engagement.BJRI may benefit from traffic momentum, meal deals, menu additions and digital marketing efficiency.CMG's Q2 performance may gain from expansion, Rewards, technology and new menu offerings. The second-quarter 2026 earnings season for U.S. restaurant operators began this week, with Domino's Pizza, Inc. (DPZ - Free Report) reporting mixed results. Several prominent restaurant operators are scheduled to release results over the next few weeks.
The latest Earnings Trend report suggests that the Zacks Retail-Wholesale sector’s second-quarter earnings are expected to increase by 9.1% from the year-ago period’s reported figure. The previous quarter recorded a 9.8% increase. The sector’s revenues are projected to increase 6.6% compared with 4.1% reported in the previous quarter.
We have identified — with the help of the Zacks Stock Screener — a few restaurant players that are set to outshine the Zacks Consensus Estimate this earnings season. These include The Cheesecake Factory Incorporated (CAKE - Free Report) , BJ's Restaurants, Inc. (BJRI - Free Report) and Chipotle Mexican Grill, Inc. (CMG - Free Report) .
Before we discuss the companies, let us examine the factors likely to have shaped the restaurant industry’s second-quarter performance.
Factors At PlayThe U.S. restaurant industry is likely to have faced an uneven operating environment in the second quarter of 2026. A volatile macroeconomic backdrop, geopolitical uncertainty and heightened competition are likely to have weighed on the respective company’s second-quarter performance. Elevated gas prices may have constrained consumers’ discretionary budgets, while affordability pressures remained particularly pronounced among lower-income consumers.
Elevated operating expenses are likely to have constrained profitability in the second quarter. Per the National Restaurant Association, total expenses for an average restaurant are projected to be 36% higher in 2026 than in 2019, with average hourly earnings and wholesale food prices up 41% and 35%, respectively, from pre-pandemic levels. Limited pricing flexibility, greater reliance on value promotions and elevated beef, pork, produce and seafood costs are likely to have weighed on restaurant-level margins.
Restaurant companies’ emphasis on meal deals, loyalty offers and digital promotions is likely to have supported transactions during the quarter under review. Heightened international travel and the FIFA World Cup likely increased restaurant spending in select urban and destination markets. Meanwhile, broader GLP-1 adoption may have shifted ordering preferences toward smaller portions and protein-focused offerings without materially weakening restaurant engagement.
Restaurant spending is likely to have remained resilient in nominal terms. Per the report, eating and drinking place sales reached a seasonally adjusted $102.5 billion in June, up slightly from $102.4 billion in May and marking the fourth monthly increase in five months. Inflation-adjusted sales rose 0.4% year over year and remained relatively flat in recent months. Restaurant companies with compelling value offerings, strong digital ecosystems, effective cost controls and flexible menus are likely to have been better positioned during the quarter.
How to Make the Right Pick?Given the wide range of companies in this space, the task is by no means easy. While it is impossible to be sure of the outperformers, our proprietary methodology — a positive Earnings ESP, along with a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — makes it relatively simple. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP is our proprietary methodology for identifying stocks with high chances of delivering a surprise in their upcoming earnings announcements. It shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate. Our research shows that for stocks with the abovementioned combination, chances of a positive earnings surprise are as high as 70%.
Our ChoicesHere we discuss in detail the three abovementioned restaurant companies that are likely to beat estimates this time around.
Cheesecake Factory is scheduled to report second-quarter fiscal 2026 results on July 28. CAKE has an Earnings ESP of +2.76% and currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
CAKE’s second-quarter results are likely to have benefited from new restaurant openings, menu innovation and stronger digital engagement. The rollout of its mobile app and more personalized Rewards offers is likely to have supported ordering frequency and customer acquisition, while solid momentum at Flower Child and disciplined restaurant execution may have aided sales and profitability. However, low-to-mid-single-digit commodity and labor inflation, higher marketing expenses and continued softness at North Italia are likely to have constrained margin expansion.
The Zacks Consensus Estimate for CAKE’s fiscal second-quarter earnings per share (EPS) and revenues is pegged at $1.17 and $997.8 million, respectively. EPS estimates for the fiscal second quarter increased 2.6% in the past 60 days. CAKE has surpassed earnings estimates in each of the trailing four quarters.
BJ's Restaurants is slated to report second-quarter 2026 results on July 30. BJRI currently has an Earnings ESP of +7.51% and a Zacks Rank #2.
BJ’s Restaurants’ second-quarter results are likely to have benefited from sustained traffic momentum, strong performance during the celebration season and increased marketing support. The Pizookie Meal Deal, seasonal Pizookies, enhanced pizza offerings and the premium Wagyu burger are likely to have supported guest frequency, menu mix and brand relevance, particularly among younger consumers. Continued improvements in restaurant execution, guest satisfaction and digital marketing efficiency are likely to have aided the company's performance in the to-be-reported quarter.
The Zacks Consensus Estimate for BJRI’s to-be-reported quarter’s EPS and revenues is pegged at 87 cents and $374.6 million, respectively. EPS estimates for the second quarter increased 1.2% in the past 60 days. BJRI has surpassed earnings estimates in three of the trailing four quarters and missed once.
Chipotle is scheduled to report second-quarter 2026 results on July 29. CMG currently has an Earnings ESP of +0.84% and a Zacks Rank #3.
Chipotle's second-quarter performance is likely to have benefited from restaurant expansion, menu innovation, stronger Rewards engagement and operational technology investments. The continued rollout of Chipotlanes, Chipotle Honey Chicken and Cilantro Lime Sauce, along with enhanced digital features, is likely to have supported transactions, customer frequency and sales mix. High-efficiency kitchen equipment and the Chipotle Kitchen digital make-line system may also have improved throughput, order accuracy and service execution. However, mid-single-digit food-cost inflation, particularly for avocados, dairy and beef, along with wage pressure and cautious consumer spending, is likely to have constrained restaurant-level margins.
The Zacks Consensus Estimate for Chipotle's to-be-reported quarter’s EPS and revenues is pegged at 32 cents and $3.32 billion, respectively. EPS estimates for the second quarter have remained unchanged in the past 60 days. CMG surpassed earnings estimates in each of the trailing four quarters.
Key Takeaways Nasdaq's Q2 earnings rose 25% as revenues gained 15%, beating estimates on broad-based growth.Index revenues surged 38%, while Financial Technology revenues climbed 16% and ARR rose 16%.Market Services hit record revenues, while margins expanded 200 basis points to 57%. Nasdaq, Inc. (NDAQ - Free Report) reported second-quarter 2026 non-GAAP earnings of $1.07 per share, up 25% year over year. The figure beat the Zacks Consensus Estimate of 98 cents by 9.18%.
Net revenues increased 15% to $1.5 billion and topped the consensus estimate of $1.4 billion by 3.87%. Growth was broad-based across all three divisions. Annualized recurring revenues rose 11% to $3.3 billion and organic ARR growth reached 12%.
NDAQ Solutions Revenues Gain MomentumSolutions revenues advanced 17% year over year to $1.16 billion, representing 77% of net revenues. The increase reflected strength across Capital Access Platforms and Financial Technology, with adjusted and organic growth also coming in at 17%.
Annualized SaaS revenues reached $1.23 billion, up 12% on a reported basis and 15% organically. SaaS represented 38% of annualized recurring revenues, underscoring the rising contribution from subscription-based offerings. The recurring mix also provided a steadier complement to transaction-sensitive market revenues.
Nasdaq Capital Access Benefits From Index StrengthCapital Access Platforms revenues climbed 19% to $621 million or 18% on an adjusted basis. Index revenues surged 38% to $271 million, or 35% after excluding a one-time contract modification benefit. Data and Listing Services revenues increased 10% to $217 million, while Workflow and Insights revenues rose 5% to $133 million.
Index exchange-traded product assets under management ended the quarter at $1.11 trillion. Net inflows totaled $51 billion in the quarter and $109 billion over the trailing 12 months. Nasdaq also launched 34 new index products and welcomed seven of the 10 largest operating-company IPOs during the period.
NDAQ Financial Technology Posts Broad-Based GrowthFinancial Technology revenues rose 16% to $539 million and increased 15% organically. Financial Crime Management Technology revenues grew 22%, Regulatory Technology gained 15%, and Capital Markets Technology advanced 15% on a reported basis. Financial Technology ARR increased 16% to $1.870 billion.
The division signed 58 new clients, seven cross-sells and 107 upsells. Nasdaq Verafin added 47 small- and medium-sized bank clients and six enterprise deals, while its Agentic AI Workforce expanded to 750 clients. Calypso also broadened its reach to more than 70 countries through new client activity.
Nasdaq Market Services Sets Revenue RecordMarket Services net revenues increased 11% to a record $340 million. U.S. equity derivatives trading revenues were $123 million, while U.S. cash equity trading revenues reached $128 million. European cash equity trading contributed $32 million, and U.S. tape plan revenues were $33 million.
Nasdaq held a 29.1% matched share in U.S. multi-listed options and a 14.7% matched share in U.S.-listed cash equities. Its share in Nordic and Baltic cash equities was 74.5%. The Closing Cross also handled record notional values during the Russell reconstitution and June Triple Witch events.
NDAQ Margins Expand as Cash Flow Supports ReturnsNon-GAAP operating income rose 19% to $859 million. The non-GAAP operating margin expanded 200 basis points to 57%, as revenue growth outpaced the 10% increase in non-GAAP operating expenses to $641 million. Higher compensation, marketing and technology investments drove the expense increase.
Cash flow from operations totaled $711 million. Nasdaq returned $174 million through dividends and $356 million through share repurchases, while repaying $162 million of debt. Cash and cash equivalents were $520 million at quarter-end, and long-term debt was $8.5 billion.
Nasdaq Raises Expense Outlook for 2026Nasdaq updated its 2026 non-GAAP operating expense guidance to a range of $2.530 billion to $2.570 billion. The revised outlook reflects higher compensation tied to revenue execution, increased marketing costs amid a stronger IPO environment and continued technology investments.
The company maintained its non-GAAP tax rate guidance in the range of 22.5% to 24.5%. Strategic activity included agreements to sell Nasdaq Fund Secondaries and acquire Dasseti, an AI-powered due diligence platform that will be integrated into eVestment. Nasdaq also advanced tokenized collateral capabilities through Calypso on the Canton Network.
Zacks RankNDAQ currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of an Industry PlayerCME Group's (CME - Free Report) second-quarter 2026 adjusted earnings of $2.99 per share beat the Zacks Consensus Estimate of $2.91 by 2.7%. The bottom line increased 1% from the year-ago quarter. Revenues of $1.70 billion surpassed the consensus estimate of $1.68 billion by 1.2% and rose 1% year over year.
Average daily volume (ADV) totaled 29.8 million contracts, representing the company's third-highest quarterly ADV.
Management expects full-year adjusted operating expenses, excluding license fees, of approximately $1.695 billion and capital expenditures, net of leasehold improvement allowances, of roughly $85 million.
Upcoming ReleasesCboe Global Markets, Inc. (CBOE - Free Report) is set to release second-quarter 2026 earnings on July 31. The Zacks Consensus Estimate for second-quarter earnings per share is pegged at $3.41, indicating an increase of 38.6% from the year-ago reported figure.
CBOE delivered an earnings surprise in each of the last four reported quarters.
Intercontinental Exchange Inc. (ICE - Free Report) is set to release second-quarter 2026 earnings on July 30. The Zacks Consensus Estimate for second-quarter earnings is pegged at $1.84 per share, indicating an increase of 1.7% from the year-ago reported figure.
ICE delivered an earnings surprise in each of the last four reported quarters.
CME Group has underperformed the S&P 500, declining nearly 12% over the past 11 months. CME delivered solid Q2 2026 results, with EPS of $2.99 and revenue of $1.71B, both of which beat analysts' expectations. Market Data revenue surged more than 20% compared to the same period a year ago.
Have you been searching for a stock that might be well-positioned to maintain its earnings-beat streak in its upcoming report? It is worth considering Expedia (EXPE - Free Report) , which belongs to the Zacks Leisure and Recreation Services industry.
When looking at the last two reports, this online travel company has recorded a strong streak of surpassing earnings estimates. The company has topped estimates by 24.13%, on average, in the last two quarters.
For the most recent quarter, Expedia was expected to post earnings of $1.41 per share, but it reported $1.96 per share instead, representing a surprise of 39.01%. For the previous quarter, the consensus estimate was $3.46 per share, while it actually produced $3.78 per share, a surprise of 9.25%.
Price and EPS Surprise
Thanks in part to this history, there has been a favorable change in earnings estimates for Expedia lately. In fact, the Zacks Earnings ESP (Expected Surprise Prediction) for the stock is positive, which is a great indicator of an earnings beat, particularly when combined with its solid Zacks Rank.
Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be as high as seven.
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.
Expedia has an Earnings ESP of +7.86% at the moment, suggesting that analysts have grown bullish on its near-term earnings potential. When you combine this positive Earnings ESP with the stock's Zacks Rank #2 (Buy), it shows that another beat is possibly around the corner. The company's next earnings report is expected to be released on August 5, 2026.
When the Earnings ESP comes up negative, investors should note that this will reduce the predictive power of the metric. But, a negative value is not indicative of a stock's earnings miss.
Many companies end up beating the consensus EPS estimate, but that may not be the sole basis for their stocks moving higher. On the other hand, some stocks may hold their ground even if they end up missing the consensus estimate.
Because of this, it's really important to check a company's Earnings ESP ahead of its quarterly release to increase the odds of success. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
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52-Week Range$69.16▼
$94.57Dividend Yield2.53%
P/E Ratio18.52
Price Target$95.45
Otis Worldwide NYSE: OTIS just gave income investors a gift wrapped in a sell-off. Shares dropped by more than 2% the day the elevator giant reported Q2 2026 earnings.
The company met expectations with adjusted earnings per share (EPS) of $1.01. Then, management trimmed its profit outlook for the second consecutive quarter.
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But look past the short-term outlook, and a different story emerges. Sales are growing, the backlog is the strongest it's been in years, and the company’s dividend keeps getting bigger.
For investors willing to separate this quarter's cost pressure from next year's payoff, Otis looks less like a broken story and more like a company in the middle of a renovation.
Otis Earnings Show Strong Sales, But Margin Pressure PersistsNet sales in the quarter climbed 7% year-over-year to $3.86 billion, with organic growth of 6%. Service, which is Otis's highest-margin, most durable business at 94% of segment operating profit, grew organic sales 9%. Modernization orders were up 24%, and the backlog was up a striking 26% on a constant currency basis. That backlog number is a leading indicator of revenue that Otis hasn't even booked yet.
That was the good news. The bad news showed up in margins. Adjusted operating profit fell to $587 million from $612 million, and adjusted operating margin contracted 180 basis points to 15.2%. Adjusted EPS, as stated earlier, came in at $1.01, down from $1.05 a year ago. New Equipment was the drag. Sales were flat, but operating profit was down 41% as new-equipment sales in China fell in the "high teens" and productivity investments bit into margins.
Why Otis Lowered Guidance Despite Solid Revenue GrowthOtis didn't touch its sales outlook. Total net sales guidance stays at $15.1B to $15.3B, still framed as "up low to mid-single digits" organically. What moved was cost: management now expects constant-currency adjusted operating profit down $45 million to $15 million for the year, versus a prior call for growth of $20M–$60M. Translate that to EPS, and 2026 guidance lands at $4.01 to $4.05, essentially flat against 2025's $4.05.
The culprit is a familiar one in this earnings season. That is, labor and material cost inflation outrunning pricing gains in the near term. The cut is also due to $20 million in spending to balance micro-pricing against customer retention, and $50 million in productivity and field-cost initiatives that management is choosing to absorb now rather than defer.
Why OTIS Still Appeals to Dividend InvestorsOtis raised its dividend by 5% this quarter and still repurchased approximately $400 million in stock. That brought year-to-date buybacks to approximately $800 million. That’s unchanged from the company’s prior guidance despite the profit cut.
Adjusted free cash flow guidance did dip slightly, to $1.5B–$1.55B from $1.6B–$1.65B, but management isn't pulling back capital return to fund the investment cycle. That should make investors comfortable that Otis is treating margin pressure as a controllable, temporary cost of building future capacity, not a sign of a deteriorating business.
The bet for income-oriented investors is straightforward: get paid a growing dividend to hold through a period where Otis is reinvesting in service quality, pricing discipline, and a backlog that's already up 26%. If modernization and repair volumes convert that backlog into revenue as planned in 2027, today's margin trough becomes tomorrow's operating leverage.
The Biggest Risks Facing OTISTwo consecutive guidance cuts on profitability is not nothing, and "flattish EPS" for a full year is a tough sell to growth investors. Labor and material cost inflation could persist longer than management expects. Also, a slowdown in its New Equipment business, particularly in China, where organic growth fell more than 20% in the first half, remains a genuine drag with no clear inflection point yet.
Otis Stock Tests Key Support After EarningsThe chart tells a story of a stock that’s still looking for a bottom. OTIS peaked near $96 in February 2026 and slid roughly 27% into a low near $70 by June, well below its 50-day SMA, which currently sits at about $72. That’s right where July 22's intraday decline stalled (high of $72.26) before reversing to close at $70.25.
The relative strength index (RSI) reading of 41, below its own 14-period average of 51, shows momentum has rolled over again after a brief attempt to reclaim the 50-day line in July. It's not oversold territory yet, but it's a stock that has repeatedly failed to hold above its 50-day average since March. This is a level bulls will want to see reclaimed and held before calling this a real turn.
OTIS chart displaying a price floor around $72, with RSI of 41.
For now, OTIS looks like a name in a basing pattern: beaten down, dividend-supported, and waiting on either a cost inflection or a technical breakout to confirm the next leg. But investors with a time horizon of over 12 months may be rewarded with growth as the company’s backlog drives future earnings.
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The AI boom is creating opportunities across semiconductors, cloud computing, enterprise software, infrastructure, cybersecurity, and automation.
Inside this report, you’ll find 10 companies positioned to benefit as artificial intelligence moves from hype to real-world deployment and becomes a core growth driver for corporate America.
Alphabet's latest earnings report has renewed optimism for companies like Lumentum supplying optical networking and data center components, even as investors scrutinize the rising cost of artificial intelligence infrastructure.
While some investors focused on Alphabet's higher capital expenditure plans, Stifel analysts said the company's results reinforced expectations that AI infrastructure spending remains robust.
“The first hyperscaler print this earnings cycle reinforces our view that the AI data center buildout is not decelerating,” the analysts wrote following Alphabet's quarterly results.
Alphabet's continued investment is viewed as a positive signal for suppliers of interconnects, optics and networking hardware used in AI data centers.
The company is one of several hyperscalers, alongside Microsoft and Amazon, that are investing heavily in expanding AI infrastructure.
According to Stifel, Alphabet's results support companies with significant exposure to AI data center deployments.
Stifel identified Lumentum Holdings, Celestica and Coherent as the hardware companies with the greatest exposure to Alphabet's spending.
The brokerage also pointed to Marvell Technology as an important supplier of optical digital signal processors, while Semtech was highlighted for its growing supply of active copper cable to Alphabet.
Monolithic Power Systems was also identified as having meaningful exposure through power-related products.
“This initial read is overwhelmingly positive for the space and should skew positive for the CapEx spend insights from the other hyperscaler reports to follow,” the analysts added.
The brokerage suggested investors could look at these companies ahead of earnings from other hyperscalers. Microsoft is scheduled to report results on July 29, followed by Amazon on July 30.
Lumentum shares gained after Barclays also upgraded the stock to Overweight, citing strong demand for the company's optical and laser components used in AI data centers.
Barclays also assigned a $1,000 price target while pointing to expectations ahead of Lumentum's fiscal fourth-quarter earnings in August.
Lumentum stock LITE gained 1.8% on Thursday's session.
Lumentum has increasingly positioned itself as a beneficiary of the AI infrastructure boom by expanding its portfolio of optical and photonic technologies.
According to Seeking Alpha analysts, the company has diversified beyond legacy telecommunications markets through acquisitions including Oclaro, NeoPhotonics, IPG Photonics and Cloud Light Technology.
These deals have expanded Lumentum's exposure to cloud computing, AI, machine learning and high-speed optical networking.
The company reported that its Cloud & Networking segment accounted for 85.7% of fiscal 2025 revenue, up from 58.9% in fiscal 2022 under its previous Telecom and Datacom reporting structure.
The analysts also highlighted several long-term growth opportunities, including Optical Circuit Switches, expanding optical scale-out deployments and the anticipated transition toward optical scale-up architectures beginning in 2028.
Lumentum reported fiscal third-quarter 2026 revenue of $808.4 million, up 90.1% year over year, supported by accelerating laser sales tied to AI infrastructure demand.
Looking ahead, the analysts said broader adoption of Co-Packaged Optics for application-specific integrated circuits could drive additional demand for Lumentum's next-generation ultra-high-power lasers beginning in 2027.
At the same time, the experts warned that Lumentum continues to face execution risks, including elevated debt levels, uneven cash generation and shortages of critical components that could affect future capacity expansion.
Southern Missouri Bancorp NASDAQ: SMBC reported stronger quarterly and full-year earnings as net interest income improved, operating expenses declined and tax credit investments lowered its tax provision, executives said on the company’s fiscal fourth-quarter earnings call.
President and Chief Administrative Officer Matt Funke said the June quarter, which closed the company’s fiscal year, benefited from higher net interest income, higher non-interest income, lower non-interest expense and a reduced income tax provision. Those gains were partly offset by a higher provision for credit losses.
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For the quarter, Southern Missouri earned $1.83 per diluted share, up $0.23, or about 14%, from the linked March quarter and up $0.44, or about 32%, from the June 2025 quarter. For fiscal 2026, the company earned $6.43 per diluted share, compared with $5.18 in fiscal 2025.
Funke said the 24% year-over-year increase in full-year earnings was “predominantly driven by stronger net interest income,” which reflected margin expansion as funding costs declined, along with nearly 5% average earning asset growth. He said the company generated a return on assets of 1.41% for fiscal 2026.
Loan Growth Remains Solid, But Management Expects Moderation Gross loan balances increased $69 million during the fourth quarter and were up $291 million, or 7.1%, from a year earlier. Funke said growth during the quarter was driven largely by construction and land development loans, one-to-four-family residential real estate, multifamily loans, agricultural real estate and seasonal agricultural production lending.
Loan originations totaled about $335 million in the quarter, up $85 million from the year-ago period, though Funke said several larger payoffs muted the impact. The expected 90-day pipeline rose by about $4 million from the prior quarter to $182 million.
Looking to fiscal 2027, Funke said management continues to expect mid-single-digit loan growth. However, he said growth could moderate from the 7% achieved in fiscal 2026 because the company is prioritizing core deposit relationships rather than wholesale funding to support new loan production.
Deposits increased about $67 million, or 1.5%, in the fourth quarter and were up roughly $126 million, or about 3%, year over year. Funke said deposit growth in the quarter was primarily driven by brokered deposits, noting that brokered balances were up just under $56 million from a year earlier. He said local deposit rate competition has increased and wholesale funding has sometimes been more cost-effective.
The company has begun rolling out a new suite of business accounts and adjusted employee incentives in an effort to grow lower-cost operating accounts over time, Funke said.
Net Interest Margin Holds Steady, But Funding Costs Could Pressure Results Net interest margin was 3.67% in the June quarter, unchanged from the March quarter and up from 3.47% a year earlier. Net interest income rose almost 3% from the linked quarter and about 10% year over year.
Chief Financial Officer Stefan Chkautovich said the margin included about three basis points of fair value discount accretion on acquired loan portfolios and premium amortization on assumed deposits, unchanged from the linked quarter. He also said the quarter included a $603,000 reversal of accrued interest income, which reduced the margin and average earning asset yield by about five basis points.
Chkautovich said Southern Missouri generated 22 basis points of net interest margin expansion in fiscal 2026, primarily due to lower-cost deposits in a declining rate environment. But he cautioned that the company could face core margin pressure in coming quarters because short-term rates have recently increased and deposit competition remains elevated. About 25% of total deposits are indexed to the 91-day Treasury bill, he said.
In response to an analyst question, Chkautovich said the 91-day Treasury rate was up about 14 basis points from the start of July for the company’s indexed deposits. He also said about $550 million of fixed-rate loans are maturing over the next 12 months, with new originations about 25 basis points above maturing loan rates. At the same time, roughly $1.3 billion of certificates of deposit are repricing, with new CD rates about 3 to 5 basis points above maturing rates.
Credit Costs Rise as Two Relationships Drive Charge-Offs Chairman and Chief Executive Officer Greg Steffens said adversely classified loans improved from the prior quarter, declining to $54 million, or 1.2% of gross loans. Non-performing loans fell $2.5 million to about $28 million, or 0.63% of gross loans, at June 30.
Non-performing assets, however, increased $1.5 million from the prior quarter to about $33.5 million, primarily due to a rise in other real estate owned. Steffens said the increase followed the foreclosure of a previously disclosed commercial loan relationship secured by commercial real estate and equipment. The equipment was liquidated, and the commercial real estate was transferred to other real estate owned. The company recognized a $1.2 million charge-off on the transfer, leaving a remaining carrying value of about $3.6 million.
Steffens also said the company downgraded a separate agricultural lending relationship to non-accrual status during the quarter. The borrower filed for Chapter 7 bankruptcy, and Southern Missouri recognized a $2.6 million charge-off, leaving remaining exposure of $5.9 million supported by additional specific reserves.
The provision for credit losses was $3.2 million in the quarter, up from $2.1 million in the March quarter. Chkautovich said net charge-offs totaled $4.3 million, up $4 million from the linked quarter, mainly related to the agricultural production loan and the commercial loan relationship transferred to other real estate owned.
The allowance for credit losses totaled $54.9 million at June 30, representing 1.25% of gross loans and 199% of non-performing loans. That compared with $55.9 million, or 1.29% of gross loans and 186% of non-performing loans, at March 31.
In the question-and-answer session, Chkautovich said the company could see some increase in provision expense in fiscal 2027 following its annual model adjustment. He said a potential allowance range could be about 1.25% to 1.35% of loans, depending on problem asset levels.
Steffens said management expects charge-offs to improve from the past two fiscal years, when they were 17 basis points and 18 basis points. He said the company is targeting progress toward historical levels of roughly 3 to 5 basis points annually.
Agricultural Portfolio Outlook Improves, But Reserves Remain Elevated Steffens said agricultural real estate balances totaled $296 million, or 7% of gross loans, while agricultural production and equipment loans totaled $219 million, or 5% of gross loans. Agricultural production and equipment balances rose $15 million from the prior quarter due to normal seasonality tied to planting and higher operating costs.
He said planting has been completed across Southern Missouri’s markets, with the projected 2026 crop mix consisting of about 30% soybeans, 30% corn, 20% cotton, 15% rice and 5% specialty crops. Steffens said favorable planting and timely rainfall have positioned most major crops for above-average yield potential.
Current commodity prices and expected yields are running about 10% to 15% above the company’s underwriting assumptions, partially offsetting elevated production costs and improving projected farm profitability, Steffens said. He added that higher USDA Price Loss Coverage and Agricultural Risk Coverage payments this fall should provide additional liquidity for many farmers.
Despite the improved outlook, Steffens said the company continues to maintain elevated reserves for its agricultural production portfolio because of prolonged pressure in the sector.
Capital Deployment, Expenses and M&A Southern Missouri increased tangible book value per share to $47.43, up $5.56, or 13%, from a year earlier. During fiscal 2026, the company repurchased 317,000 shares, or nearly 3% of average common shares outstanding at the start of the year, at an average price of $58.59. In the fourth quarter, it repurchased 4,000 shares at an average price of just over $69.
The company also announced an 8% increase in its quarterly dividend, raising it by $0.02 to $0.27 per share.
Non-interest expense declined 2.6% from the linked quarter, Chkautovich said, due mainly to lower other non-interest expense, occupancy and equipment expense, and data processing costs. For fiscal 2026, non-interest expense totaled $102.1 million, unchanged from fiscal 2025. Looking ahead, he said operating expenses are expected to “re-accelerate” in fiscal 2027 as the company invests in new employees and technology, with expense growth potentially in the mid-single digits to the low-to-high single digits depending on timing.
Steffens said discussions around mergers and acquisitions have remained active. He said there are approximately 75 banks with $500 million to $2 billion in assets within the company’s footprint, in addition to institutions in adjacent markets. In response to an analyst question, he said the company’s improved trading multiples and capital position make M&A more attractive than buybacks at current valuation levels.
“Our focus remains on disciplined execution, prudent risk management, and thoughtful capital deployment to deliver sustained, attractive returns to our shareholders,” Steffens said.
About Southern Missouri Bancorp (NASDAQ:SMBC)Southern Missouri Bancorp, Inc NASDAQ: SMBC is a bank holding company headquartered in West Plains, Missouri, serving as the parent of Southern Bank. The company focuses on delivering community banking services to individual and commercial customers across southern Missouri and northern Arkansas. It operates branch offices in local markets and provides a comprehensive suite of deposit and lending products tailored to both urban and rural communities.
Through its subsidiary, Southern Bank, the company offers deposit products such as checking and savings accounts, money market accounts and certificates of deposit, alongside digital and mobile banking platforms.
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Robotics and automation are rapidly becoming essential infrastructure across healthcare, manufacturing, logistics, and many other industries.
"Physical AI" is coming to the United States, and there are four ways that investors can gain exposure to this new robotics revolution. Plus, learn which seven companies are most positioned to benefit as intelligent robots enter the workforce.
Key Takeaways Snap-on posted Q2 EPS of $4.96 and net sales of $1.24 billion, both above estimates.Commercial & Industrial sales climbed 13.8%, driven by 11% organic growth and acquisitions.Tools Group sales rose 3.6% as U.S. and international operations delivered 3% organic growth. Snap-on Inc. (SNA - Free Report) reported solid second-quarter 2026 results, wherein the top and bottom lines surpassed the Zacks Consensus Estimate and grew year over year. Results benefited from broad-based Commercial & Industrial Group growth and continued gains in the Tools Group.
Snap-on’s earnings of $4.96 per share surpassed the Zacks Consensus Estimate of $4.90. The figure increased from adjusted earnings of $4.72 per share in the year-ago quarter.
SNA’s Quarterly Performance: Key Metrics & InsightsNet sales totaled $1.24 billion, up 4.7% from the prior year, and topped the Zacks Consensus Estimate of $1.22 billion. Sales benefited from a 3% increase in organic sales ($35.5 million), $11.5 million of acquisition-related sales and an $8.7 million favorable impact from foreign currency fluctuations.
The gross profit of $635.2 million rose 6.7% year over year and the gross margin expanded 90 basis points (bps) to 51.4%. Our model expected a gross margin of 49.6%, down 90 bps from the year-ago quarter.
Snap-on’s operating earnings before financial services totaled $268.9 million, up 3.8% year over year. As a percentage of sales, operating earnings before financial services decreased 20 bps to 21.8% in the second quarter.
Consolidated operating earnings (including financial services) were $336.4 million, up 2.8% year over year. As a percentage of revenues, operating earnings fell 30 bps year over year to 25.2%.
Snap-on’s Q2 Segmental AnalysisSales in the Commercial & Industrial Group rose 13.8% from the year-ago quarter to $395.8 million, driven by a $2.5 million gain in favorable foreign currency translation, a $38.7 million or 11%, organic sales rise and $6.8 million in acquisition-related sales. The organic rise is mainly owing to increased sales across each of the segment’s operations. For the second quarter, we expected sales of $360 million for the segment.
The Tools Group segment’s sales increased 3.6% year over year to $508.8 million. We estimated sales of $505.7 million for the segment. The increase resulted from an organic sales rise of 3%, owing to an improvement in sales both in the United States and the segment’s international operations. Also, a $2.9 million benefit from foreign currency translation aided revenues. Management continues to focus on strengthening the franchise van channel. The company believes investments in product innovation, brand strength and franchisee support can sustain the segment’s long-term growth trajectory.
The Repair Systems & Information Group segment sales were $480.3 million in the quarter compared with $468.6 million in 2025. Organic sales edged up 0.7%, with acquisitions adding $4.7 million and favorable foreign currency translation contributing $3.8 million. We expected sales of $482.7 million for the segment.
The Financial Services business’ revenues dipped 2% year over year to $99.7 million. Our estimate for sales from this segment was $102.3 million.
SNA's Financial SnapshotSnap-on ended the second quarter of 2026 with cash and cash equivalents of $1.64 billion, with shareholders’ equity (before non-controlling interest) of $6.1 billion.
Snap-on generated $271.5 million in operating cash flow during the quarter, up from $237.2 million a year earlier. Capital expenditures totaled $23.1 million, while acquisitions used $154 million.
What’s Ahead for Snap-on?Snap-on expects its markets and operations to remain resilient despite ongoing economic uncertainty. The company plans to advance its growth initiatives by leveraging its established strengths in automotive repair, expanding its professional customer base across adjacent markets and new geographies, and increasing its presence in critical industries. For 2026, Snap-on continues to project capital expenditures of approximately $100 million, including $44.3 million spent during the first six months, and expects a full-year effective income tax rate of about 22%.
This Zacks Rank #3 (Hold) company’s shares have gained 8.4% in the past three months compared with the industry's 5.5% growth.
Image Source: Zacks Investment Research
Key PicksDuluth Holdings Inc. (DLTH - Free Report) sells casual wear, workwear, outdoor apparel, and accessories for men and women in the United States. It offers shirts, pants, shorts, underwear, outerwear, footwear, accessories and hard goods. At present, DLTH sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for current fiscal-year sales implies a decline of 2.8%, and the same for earnings implies growth of 39.5% from the year-ago reported figures. DLTH delivered a trailing four-quarter earnings surprise of 107.5%, on average.
Carter’s, Inc. (CRI - Free Report) designs, sources and markets branded children's wear in the United States and internationally. At present, CRI has a Zacks Rank of 2 (Buy).
The Zacks Consensus Estimate for current fiscal-year sales implies growth of 4.9%, and the same for earnings implies a decline of 10.9% from the year-ago figures. CRI delivered a trailing four-quarter negative earnings surprise of 100.8%, on average.
Vince Holding Corp. (VNCE - Free Report) provides luxury apparel and accessories in the United States and internationally. It operates through Vince Wholesale and Vince Direct-to-Consumer segments. At present, VNCE carries a Zacks Rank of 2.
The Zacks Consensus Estimate for current fiscal-year sales and earnings implies growth of 7.2% and 34.1%, respectively, from the year-ago reported figures. VNCE has delivered a trailing four-quarter earnings surprise of 635.7%, on average.
Key Takeaways CONMED's AirSeal is now FDA-cleared for 8 mm hex cannulas on the da Vinci 5 robotic platform.Joint testing with Intuitive Surgical supported compatibility across da Vinci X, Xi and 5 systems.AirSeal maintains pressure, clears smoke and supports low-pressure insufflation during robotic surgery. CONMED (CNMD - Free Report) recently announced that the FDA has expanded the indication for its AirSeal Robotic Solution to be used with Intuitive Surgical’s (ISRG - Free Report) 8 mm hex cannulas on the da Vinci 5 (dV5) robotic surgery platform. Previously approved for Intuitive Surgical’s 8 mm round cannulas, the solution is now compatible across the full portfolio of the da Vinci X, da Vinci Xi and da Vinci 5 robotic systems.
Management noted that the expanded indication was supported by extensive engineering and technical compatibility testing conducted jointly with Intuitive Surgical. The company remains focused on providing surgeons and hospitals with compatibility data and clear product communication, helping them deliver high-quality patient care.
The expanded indication brings greater clarity on the integration of the AirSeal Robotic Solution with the da Vinci 5 platform, supporting efficient and consistent surgical workflows while contributing to positive patient outcomes. Management also expressed confidence that this achievement strengthens the long-term growth potential of CONMED’s AirSeal portfolio.
Likely Trend of CNMD Stock Following the NewsFollowing the announcement, CNMD shares gained 0.3% at yesterday’s close. Year to date, the stock has risen 3.5% against the industry’s 2.2% decline. However, the S&P 500 has risen 9.3% in the same timeframe.
CONMED is well positioned to benefit from the expanded indication for its AirSeal Robotic Solution. Compatibility with the da Vinci 5 platform broadens the product’s addressable market and reinforces its value within robotic-assisted minimally invasive surgeries. As hospitals continue to adopt ISRG’s latest robotic platform and the company continues to expand in international markets, adoption of CONMED’s AirSeal is likely to be strengthened, which will drive growth for its surgical portfolio.
CNMD currently has a market capitalization of $1.26 billion.
Image Source: Zacks Investment Research
More on the NewsThe AirSeal Robotic Solution is an advanced insufflation system developed specifically for robotic-assisted minimally invasive surgery. It combines an AirSeal Cannula Cap with AirSeal and a bifurcated tube set to deliver stable pneumoperitoneum, continuous smoke evacuation and low-pressure insufflation through robotic ports, eliminating the need for an accessory port. Unlike conventional insufflation systems that replenish carbon dioxide only after pressure drops, AirSeal maintains pressure, improving visualization and minimizing interruptions during surgery.
Its three-lumen design provides CO2 insufflation, smoke evacuation and a regulated gas barrier that maintains consistent cavity pressure even during leaks or suction. By preserving visualization, minimizing pressure fluctuations and restoring pneumoperitoneum when disruptions occur, the system supports physiologic stability, enhances intraoperative efficiency and contributes to smoother patient recovery during minimally invasive robotic procedures.
The expanded indication strengthens AirSeal’s role in robotic surgery by enabling seamless integration with Intuitive Surgical’s latest system architecture while providing hospitals and surgeons with greater flexibility in using complementary technologies. Backed by more than 40 clinical studies, the system is designed to support low-pressure insufflation, helping improve patient outcomes, procedural efficiency and surgical performance.
Industry Prospects Favoring the MarketGoing by the data provided by Mordor Intelligence, the insufflation devices market is predicted to be valued at $3.28 billion in 2026 and is expected to witness a CAGR of 5.9% through 2031.
Factors like the growing adoption of minimally invasive surgeries, advancements in insufflation technology, rising volumes of bariatric and gynecologic procedures, integration with digital operating rooms, expanding ambulatory surgery infrastructure and a shift toward disposable insufflation consumables are boosting the market’s growth.
Other NewsCONMED recently appointed John E. Gallagher as its chief financial officer, effective July 15, 2026. He succeeds Todd Garner, who will remain associated with the company in an advisory role through Nov. 2, 2026. Gallagher brings nearly three decades of financial leadership experience across public healthcare and industrial companies, including Certara, Inc., Cue Health Inc. and Becton, Dickinson & Co.
In May, CONMED announced the appointment of seasoned healthcare executives Celine Martin and Jeff Mirviss to its board of directors, effective July 1, 2026. The move expands the board to nine members and strengthens governance with deep leadership expertise from Johnson & Johnson and Boston Scientific.
CNMD’s Zacks Rank & Key PicksCONMED currently carries a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks from the broader medical space are West Pharmaceutical (WST - Free Report) and Cardinal Health (CAH - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
West Pharmaceutical reported first-quarter 2026 earnings per share (EPS) of $2.13, which beat the Zacks Consensus Estimate by 26.8%. Revenues of $844.9 million surpassed the Zacks Consensus Estimate by 8.5%.
West Pharmaceutical has an estimated long-term earnings growth rate of 14.4%. WST’s earnings surpassed estimates in the trailing four quarters, the average surprise being 19.4%.
Cardinal Health reported a third-quarter fiscal 2026 adjusted EPS of $3.17, which beat the Zacks Consensus Estimate by 13.2%. Revenues of $60.94 billion missed the Zacks Consensus Estimate by 2.3%.
Cardinal Health has an estimated long-term earnings growth rate of 17%. CAH’s earnings surpassed estimates in the trailing four quarters, the average surprise being 10.3%.
Central Garden & Pet Company is rated 'Hold' due to stagnant growth and margin concerns, despite trading below sector multiples. CENT's pet segment growth has plateaued, while garden segment margin compression offsets revenue gains, raising questions about sustainable profitability. Management maintains full-year guidance despite industry spending increases, reflecting caution amid a shrinking addressable customer base and shifting consumer habits.
United Rentals, Inc. (URI) Q2 2026 Earnings Call July 23, 2026 8:30 AM EDT
Company Participants
Matthew Flannery - President, CEO & Director
William Grace - Executive VP & CFO
Conference Call Participants
David Raso - Evercore ISI Institutional Equities, Research Division
Robert Wertheimer - Melius Research LLC
Michael Feniger - BofA Securities, Research Division
Steven Fisher - UBS Investment Bank, Research Division
Jerry Revich - Wells Fargo Securities, LLC, Research Division
Kyle Menges - Citigroup Inc., Research Division
Kenneth Newman - KeyBanc Capital Markets Inc., Research Division
Seth Weber - BNP Paribas, Research Division
Mircea Dobre - Robert W. Baird & Co. Incorporated, Research Division
Jamie Cook - Truist Securities, Inc., Research Division
Angel Castillo Malpica - Morgan Stanley, Research Division
Sabahat Khan - RBC Capital Markets, Research Division
Tami Zakaria - JPMorgan Chase & Co, Research Division
Charles Albert Dillard - Bernstein Institutional Services LLC, Research Division
Presentation
Operator
Good morning, everyone, and welcome to the United Rentals Investor Conference Call. Please be advised that this call is being recorded.
Before we begin, please note that the company's press release, comments made on today's call and responses to your questions contain forward-looking statements. The company's business and operations are subject to a variety of risks and uncertainties, many of which are beyond its control. And consequently, actual results may differ materially from those projected. A summary of these uncertainties is included in the safe harbor statement contained in the company's press release.
For a more complete description of these and other possible risks, please refer to the company's annual report on Form 10-K for the year ended December 31, 2025, as well as the subsequent filings with the SEC. You can access these filings on the company's website at www.unitedrentals.com. Please note that United Rentals has no obligation and makes no commitment to update or publicly release any revisions to forward-looking statements in order to
Key Takeaways United Rentals' Q2 revenues rose 11.8%, while adjusted earnings increased 21.9% year over year.Record rental revenues climbed 12.7%, supported by 3.4% fleet productivity growth and specialty demand.United Rentals raised its 2026 revenue outlook to $17.5-$17.8 billion on strong project activity. United Rentals, Inc. (URI - Free Report) reported solid second-quarter 2026 results, with adjusted earnings per share and total revenues beating the Zacks Consensus Estimate and increasing year over year.
Record rental revenues, higher fleet productivity and robust specialty demand supported the results. Fleet productivity improved 3.4% year over year.
URI stock gained 8.3% during yesterday’s after-hours, following the earnings release.
URI's Q2 Earnings & RevenuesURI posted adjusted earnings of $12.76 per share, up 21.9% from $10.47 a year ago and surpassing the Zacks Consensus Estimate of $11.67 by 9.3%.
Total revenues advanced 11.8% to $4.41 billion and topped the consensus mark of $4.24 billion by 4.1%.
URI’s Rental Revenues Reach a Quarterly RecordRental revenues increased 12.7% year over year to a quarterly record of $3.85 billion. Average original equipment at cost, or OEC, rose 7.1%.
Owned equipment rental revenues increased 9% to $2.99 billion from $2.75 billion. Re-rent revenues rose 46.7% to $88 million, while ancillary and other rental revenues advanced 26.2% to $770 million.
Sales of rental equipment increased 4.1% to $330 million. Sales of new equipment rose 14.7% to $86 million, contractor supplies sales increased 7.3% to $44 million and service and other revenues grew 6.3% to $101 million.
United Rentals Sees Specialty Growth AccelerateGeneral Rentals segment equipment rental revenues increased 6.6% year over year to $2.42 billion. Equipment rental gross profit rose 8.7% to $865 million, while gross margin expanded 70 basis points to 35.8%.
Specialty segment equipment rental revenues rose 24.8% to $1.43 billion. Gross profit increased 21.1% to $636 million, but gross margin contracted 140 basis points to 44.4%. The decline reflected a revenue mix shift toward lower-margin ancillary and re-rent revenues, partly offset by lower labor and benefit expenses as a percentage of revenues.
United Rentals' Profitability ImprovesGross profit increased to $1.73 billion from $1.53 billion. The gross margin improved to 39.3% from 38.9%, as revenue growth outpaced the increase in cost of revenues.
Adjusted EBITDA rose 13.6% to a quarterly record of $2.06 billion. The adjusted EBITDA margin expanded 70 basis points to 46.6%, including a $49 million gain from the sale of part of the scaffolding business. Excluding that gain, the margin declined 40 basis points due mainly to the Specialty Rentals mix pressure.
Net income increased 21.1% to a second-quarter record of $753 million. Net income margin expanded 130 basis points to 17.1%, including a $37 million after-tax benefit from the scaffolding transaction.
United Rentals Maintains Financial FlexibilityFor the first six months of 2026, net cash provided by operating activities increased 20.1% to $3.31 billion. Free cash flow declined 4.1% to $1.15 billion, including restructuring-related payments and gross rental equipment purchases of $2.72 billion.
URI ended June with liquidity of $3 billion, including $112 million in cash and equivalents. Its net leverage ratio improved to 1.8x from 1.9x at the end of 2025.
The company returned $998 million to its shareholders during the first half of 2026, comprising $750 million in share repurchases and $248 million in dividends. United Rentals expects to repurchase $1.5 billion of shares in 2026 and declared a quarterly dividend of $1.97 per share.
URI Raises Key 2026 Guidance RangesManagement raised its 2026 revenue outlook to $17.5-$17.8 billion from $16.9-$17.4 billion. The adjusted EBITDA forecast increased to $7.98-$8.13 billion from $7.63-$7.88 billion.
United Rentals now expects net cash provided by operating activities of $5.85-$6.65 billion, compared with the prior projection of $5.4-$6.2 billion. The free cash flow outlook, excluding restructuring-related payments, was maintained at $2.15-$2.45 billion.
Net rental capital expenditures are projected at $3.4-$3.8 billion after gross purchases of $4.85-$5.25 billion. Management cited large-project activity, customer backlogs and year-to-date momentum as factors supporting the higher outlook.
URI’s Zacks Rank & Recent Construction ReleasesCurrently, United Rentals carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
PulteGroup, Inc. (PHM - Free Report) reported better-than-expected second-quarter 2026 results, with adjusted earnings and total revenues topping the Zacks Consensus Estimate, but declining year over year. The quarterly results reflect reduced home-closing volumes, softer average selling prices (ASP) and margin compression.
PulteGroup ended the quarter with a backlog of 10,966 homes, up 1.7% from the prior-year level. Backlog units increased in the Northeast, Florida, Midwest and Texas, while the Southeast and West reported declines. The value of homes in backlog slipped 0.6% to $6.80 billion. The divergence between higher units and lower value indicates that the average value of homes in backlog declined year over year, consistent with PHM’s broader pricing pressure.
D.R. Horton, Inc. (DHI - Free Report) reported third-quarter fiscal 2026 earnings of $3.20 per share, beating the Zacks Consensus Estimate of $2.99 by 7%. Revenues of $9.23 billion also surpassed the consensus mark of $9.19 billion by 0.5%. On a year-over-year basis, earnings declined 4.8%, while revenues increased marginally.
DHI’s earnings and revenue beat was driven by higher home-closing volumes, resilient home sales margins, disciplined management of pricing and incentives, and contributions from the Rental, Forestar and Financial Services businesses. However, lower profitability, elevated incentives and cautious consumer demand continued to weigh on results. D.R. Horton now expects fiscal 2026 consolidated revenues of $32.5-$33 billion, down from $33.5-$34.5 billion expected earlier.
Lennar Corporation (LEN - Free Report) reported mixed second-quarter fiscal 2026 results, with adjusted earnings topping the Zacks Consensus Estimate while revenues missed the same. Year over year, both metrics declined, given ongoing softness in housing demand and a lower ASP for homes delivered.
LEN’s Homebuilding revenues declined 2% year over year to $7.62 billion from $7.84 billion, with home deliveries increasing 2% to 20,519 homes from 20,131 homes a year ago. Backlog at quarter-end increased to 16,818 homes from 15,538 homes. For the third quarter of fiscal 2026, Lennar expects home deliveries in the range of 20,500-21,500 and new orders between 21,000 and 22,000 homes. Gross margin on home sales is expected to be approximately 16%.
NEW YORK, July 23, 2026 (GLOBE NEWSWIRE) -- Bronstein, Gewirtz & Grossman, LLC, a nationally recognized investor-rights law firm, announces that a class action lawsuit has been filed against Insulet Corporation (NASDAQ: PODD) and certain of its officers.
This lawsuit seeks to recover damages against Defendants for alleged violations of the federal securities laws on behalf of all persons and entities that purchased or otherwise acquired Insulet securities between May 21, 2025 and May 26, 2026, both dates inclusive (the “Class Period”). Such investors are encouraged to join this case by visiting the firm’s site: bgandg.com/PODD.
Insulet Case Details
The complaint alleges that, throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operations, and compliance policies. Specifically, the Complaint alleges that Defendants made false and/or misleading statements and/or failed to disclose that:
Insulet’s manufacturing controls and procedures were defective;the foregoing created a foreseeable heightened risk that one or more Insulet products would be found to be in violation of applicable safety regulations and/or pose a risk of injury; andas a result, Defendants’ public statements were materially false and misleading at all relevant times. What's Next for Insulet Investors?
A class action lawsuit has already been filed. If you wish to review a copy of the Complaint, you can visit the firm’s site: bgandg.com/PODD. or you may contact Peretz Bronstein, Esq. or his Client Relations Manager, Nathan Miller, of Bronstein, Gewirtz & Grossman, LLC at 917-590-0911. If you suffered a loss in Insulet you have until August 31, 2026, to request that the Court appoint you as lead plaintiff. Your ability to share in any recovery doesn't require that you serve as lead plaintiff.
No Cost to Insulet Investors
We, Bronstein, Gewirtz & Grossman LLC, represent investors in class actions on a contingency fee basis. That means we will ask the court to reimburse us for out-of-pocket expenses and attorneys’ fees, usually a percentage of the total recovery, only if we are successful.
Why Bronstein, Gewirtz & Grossman, LLC for Insulet Securities Class Action?
Bronstein, Gewirtz & Grossman, LLC is a nationally recognized firm that represents investors in securities fraud class actions and shareholder derivative suits. Our firm has recovered hundreds of millions of dollars for investors nationwide. More at www.bgandg.com
"Our practice centers on restoring investor capital and ensuring corporate accountability, which serves to uphold the essential integrity of the marketplace," said Peretz Bronstein, Founding Partner of Bronstein, Gewirtz & Grossman, LLC.
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Peretz Bronstein, Esq. or Nathan Miller
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Prior results do not guarantee similar outcomes.
Whether it's through stocks, bonds, ETFs, or other types of securities, all investors love seeing their portfolios score big returns. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
Cash flow can come from bond interest, interest from other types of investments, and, of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends make up large portions of long-term returns, and in many cases, dividend contributions surpass one-third of total returns.
Headquartered in Chattanooga, Unum (UNM - Free Report) is a Finance stock that has seen a price change of 13.28% so far this year. The insurance company is paying out a dividend of $0.46 per share at the moment, with a dividend yield of 2.1% compared to the Insurance - Accident and Health industry's yield of 1.34% and the S&P 500's yield of 1.34%.
Looking at dividend growth, the company's current annualized dividend of $1.84 is up 4.5% from last year. Over the last 5 years, Unum has increased its dividend 4 times on a year-over-year basis for an average annual increase of 9.80%. Looking ahead, future dividend growth will be dependent on earnings growth and payout ratio, which is the proportion of a company's annual earnings per share that it pays out as a dividend. Unum's current payout ratio is 22%, meaning it paid out 22% of its trailing 12-month EPS as dividend.
UNM is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2026 is $8.75 per share, with earnings expected to increase 7.63% from the year ago period.
Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. It's important to keep in mind that not all companies provide a quarterly payout.
Big, established firms that have more secure profits are often seen as the best dividend options, but it's fairly uncommon to see high-growth businesses or tech start-ups offer their stockholders a dividend. During periods of rising interest rates, income investors must be mindful that high-yielding stocks tend to struggle. With that in mind, UNM is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of #3 (Hold).
5 Tech Stocks to Buy on the July PullbackAmeriprise Financial NYSE: AMP reported higher second-quarter 2026 revenue and earnings, as executives pointed to asset growth, strong client and advisor engagement, and continued capital returns while acknowledging pressure from advisor transitions and an aggressive recruiting environment.
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Chairman and CEO Jim Cracchiolo said the company “delivered another great quarter” in a market environment shaped by rates, inflation and geopolitical volatility. Ameriprise reported revenue growth of 13% to nearly $5 billion and adjusted operating earnings of $1 billion, up 14% from a year earlier. Adjusted operating earnings per share rose 22% to $11.07.
Time to Sell? 3 Winners With Fading Technical MomentumThe company’s return on equity increased to 55%, compared with 51.5% a year earlier. Total assets under management, administration and advisement grew 14% to $1.8 trillion, while total client assets increased 15% to $1.2 trillion.
Wealth Management Assets and Productivity Rise Ameriprise’s Advice & Wealth Management business posted adjusted operating net revenue of $3.2 billion, up 16% from the prior year, according to Chief Financial Officer Walter Berman. Pre-tax adjusted operating earnings in the segment also rose 16% to $939 million, while margins remained strong at about 29%.
5 Under-the-Radar AI Stocks to Watch in JuneWrap assets reached a record $732 billion, up 19%, driven by market appreciation, client engagement and growth in the company’s advice platform. Berman said wrap flows were $6.9 billion in the quarter, while total client flows were $3.1 billion. He said flows were affected by an acceleration of Comerica-related terminations and elevated seasonal tax payments.
Advisor productivity reached a new high of $1.2 million, up 12% year over year. Cracchiolo attributed the increase to client engagement, technology investments and advisor support. He said Ameriprise’s client satisfaction score remained 4.9 out of 5.
The company added 79 experienced advisors during the quarter. Cracchiolo said Ameriprise remains selective in recruiting, noting that some competitors’ recruiting packages imply cash payback periods “as high as eight years,” which he described as “crazy.” He said Ameriprise is attracting advisors who cite its technology, service and responsiveness as differentiators.
Comerica Outflows to End in Third Quarter; Huntington Onboarding Ahead During the question-and-answer session, Berman said approximately $19 billion related to Comerica is expected to exit by the end of the third quarter. He declined to provide more detail on how much had already left, citing client confidentiality, but said the pace of departures accelerated significantly in the second quarter compared with the first.
Executives said the Comerica impact would be offset by Huntington Bank, which is expected to join the Ameriprise Financial Institutions Group platform in the fourth quarter. Berman said Huntington is anticipated to bring about 260 advisors and $28 billion of client assets onto the platform, with assets moving in the fourth quarter and early 2027. He said Ameriprise expects to benefit from the economics of the full book beginning in the fourth quarter.
AI and Banking Remain Investment Priorities Cracchiolo said Ameriprise is expanding its use of artificial intelligence to help advisors grow, reduce administrative work and deliver more personalized advice. He said tools such as e-meeting automation, meeting summarization and Copilot Premium can collectively save practices more than 30 hours per week when used together.
In response to an analyst question, Cracchiolo said about 6,000 advisors are already using one of the firm’s technology capabilities tied to client engagement and meetings. He said adoption should continue to support productivity as more advisors incorporate the tools into their practices.
The company also highlighted growth in its bank. Cracchiolo said bank assets exceeded $25 billion, up 6%, while lending grew 61% year over year, driven by pledge lending and mortgages. Ameriprise has also introduced HELOCs and checking accounts. Berman said bank assets totaled $25.5 billion, with total client cash of $84 billion down 2% year over year.
Asset Management Outflows Improve In asset management, Ameriprise reported total assets under management and advisement of $759 billion, up 10% year over year. Pre-tax adjusted operating earnings increased 23% to $274 million, while revenues rose 14% to $947 million. The segment’s margin reached 43%, above both the prior-year level of 39% and the company’s target range of 35% to 39%.
Cracchiolo said investment performance remained a strength, with 69% of funds above the median for one year, 75% above the median for three- and five-year periods, and 87% above the median over 10 years. He also said 97 Columbia Threadneedle funds globally carried four- or five-star Morningstar ratings.
Total net outflows improved to $6.5 billion, driven by higher gross sales in North America and EMEA. Cracchiolo said the company is gaining traction in active ETFs, separately managed accounts and models, while Seligman strategies contributed to asset growth and flows.
Capital Returns Continue at Elevated Pace Ameriprise returned $932 million of capital to shareholders in the quarter through share repurchases and dividends, equal to 91% of operating earnings. Berman said the company repurchased 1.7 million shares at an average price of $459 during the quarter.
For the first half of 2026, Ameriprise returned $1.9 billion of capital to shareholders, up 25% from the prior-year period. The company repurchased 3.3 million shares at an average price of $467, compared with 2.3 million shares at an average price of $507 in the first half of 2025.
Berman said Ameriprise ended the quarter with $2.1 billion of excess capital and $2.8 billion of holding company available liquidity. He said the balance sheet and free cash flow generation allow the company to invest for growth while continuing to return capital to shareholders.
About Ameriprise Financial (NYSE:AMP)Ameriprise Financial, Inc is a diversified financial services company headquartered in Minneapolis, Minnesota. The firm provides a range of advice-based wealth management, asset management and insurance products to individual and institutional clients. Its business model centers on delivering financial planning and investment advice through a network of financial advisors alongside proprietary product offerings designed to meet retirement, protection and accumulation needs.
Core products and services include comprehensive financial planning and advisory services, managed investment portfolios, retirement planning solutions, annuities and life insurance products.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
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Super Micro Computer, Inc. delivered preliminary FQ4 results with gross margins of 15–17%, nearly double guidance, and over $60 billion in new orders. SMCI's path to $100 billion in annual revenue is supported by surging orders and expanded manufacturing capacity, with DCBBS products driving margin expansion. The company has a clear path to $10+ EPS by FY28, while consensus estimates remain far lower despite massive order momentum.
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NextCure, Inc. (NASDAQ: NXTC) related to its merger with Avere Therapeutics, Inc. Upon closing of the proposed transaction, NextCure shareholders are expected to own approximately 1.21% of the combined company. Click here for more information https://monteverdelaw.com/case/nextcure-inc/. It is free and there is no cost or obligation to you.
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Custom Health Holdings Inc (TSX:CHLT) just landed Buy-rated coverage from Stifel, with analysts setting a C$12 price target and pointing to upside as high as C$18 a share.
The pitch: a pill-dispensing platform that's quietly solving one of healthcare's most expensive headaches.
That headache is medication non-adherence, which costs the US healthcare system an eye-watering $0.5 trillion a year. Only about half of prescriptions get taken as directed, and the fallout, hospitalizations, ER visits, disease progression, adds up fast.
Custom Health's answer is a full-stack system: a device called Spencer that dispenses and monitors pills at home, an AI-powered platform called AdhereNet, and a network of automated pharmacies behind it. Stifel says the result is a 98% adherence rate, far above the industry norm.
Insurers have taken notice. Custom Health already has more than 100,000 patients contracted through deals with major US health plans, including Humana (NYSE:HUM), Elevance and BlueCross BlueShield, plus pain management specialists Commonwealth and BKC. Stifel expects the company to nearly triple its active patient count next year, from about 6,000 to 17,000, helped along by its recent acquisition of InnovativeRx, with revenue more than doubling.
One area where Custom Health has a particularly good story to tell: opioids. The platform helps physicians safely wean patients off opioid prescriptions, which lines up with the NOPAIN Act, a law that kicked in this past January and sweetens Medicare reimbursement for opioid-reduction efforts. Better adherence also tends to boost Medicare Star ratings, translating into higher rebates and bonus payments for health plans.
The typical Custom Health patient is in their 50s or 60s and juggling more than 10 chronic medications, exactly the population set to grow as the US and Canada keep aging.
Stifel thinks the InnovativeRx deal could unlock 4x revenue growth over the next two to three years as Custom Health works through 30,000 of the 100,000 patients already under contract, with more acquisitions still on the table.
The margin story is arguably the most compelling part: the Spencer device alone represents close to a $200 million recurring revenue opportunity at gross margins north of 60%. Layered on top of traditional pharmacy dispensing margins around 20%, Stifel sees a path to EBITDA margins in the high teens, well above what most pharmacy peers manage.
Stifel's initiation wasn't the only news out of Custom Health this month. The company has since signed a binding letter of intent to acquire Wisconsin-based Evergreen Pharmacy LLC, a deal expected to add more than US$78 million in annual revenue.
The price tag is modest relative to that boost: US$3.5 million total, including at least US$1 million in prescription drug inventory and US$450,000 in net working capital, cash on closing, with US$175,000 held back for six months as an indemnity cushion.
Evergreen is licensed to operate in Wisconsin, Illinois and Michigan, with room to expand into Minnesota, and specializes in managing complex therapies across behavioral health, dermatology, gastroenterology, infectious disease, rheumatology and neurology. It brought in about US$78.8 million in revenue and US$0.6 million in normalized EBITDA for the 12 months ended December 31, 2025, and posted positive net income in both fiscal 2025 and the first quarter of 2026.
For Custom Health, the deal fits neatly with the growth story Stifel laid out: more patients on complex drug regimens, a bigger Midwest footprint, and another building block toward that four-times revenue potential.
Eagle Bancorp NASDAQ: EGBN reported lower second-quarter 2026 earnings as elevated credit costs and continued balance-sheet repositioning weighed on results, while the company’s new chief executive outlined priorities focused on asset quality, deposits, operating performance and capital.
The Bethesda, Maryland-based bank holding company posted net income of $6.9 million, or $0.23 per diluted share, compared with $14.7 million in the previous quarter, Chief Financial Officer Eric Newell said on the company’s earnings call. Newell said the decline “primarily reflects elevated provision expense, a smaller interest-earning asset base, continued resolutions associated with addressing problem assets and strengthening the overall health of the balance sheet.”
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Steve Curley, who joined Eagle Bancorp as president and chief executive three weeks before the call, said his immediate focus is on disciplined execution and improving confidence in the franchise.
“Investors are looking for results, not promises,” Curley said. “You’ll judge us by what we do, not what we say, and that’s exactly how we intend to earn your confidence.”
Asset quality remains central focus Management repeatedly emphasized that troubled credits have been identified and are being actively managed. Newell said the company’s approach is to “recognize problems early, reserve adequately, pursue resolution, and maximize recovery.”
Credit metrics improved in several areas during the quarter. Eagle’s commercial real estate concentration ratio declined to 268% at quarter-end from 295% in the prior quarter, moving further below the 300% threshold. Its acquisition, development and construction concentration ratio ended the quarter at 66%.
Criticized and classified assets, including substandard, special mention and held-for-sale loans, fell by about $34.5 million during the quarter to $759.6 million at June 30, compared with $794.1 million at March 31. Newell said those balances have declined more than 30% from their peak in the third quarter of 2025. As a percentage of Tier 1 capital and allowance for credit losses, criticized and classified assets declined to 58.1% at quarter-end, compared with 65.7% at year-end 2025.
The company reported approximately $216 million of downgrade activity during the quarter, including $102 million tied to multifamily loans. Newell said three loans represented all of the multifamily downgrade activity, including $35 million that paid off after quarter-end. The remaining two loans, totaling $64 million, are undergoing restructuring, with “no future losses anticipated,” he said.
Nonperforming loans declined to $111.1 million, or 1.68% of total loans. Provision for credit losses totaled $21.4 million, and net charge-offs were $47.9 million. Newell said the provision was tied to disposition activity during the quarter, while $18.5 million of charge-offs were associated with loans transferred from held for investment to held for sale.
The allowance for credit losses ended the quarter at $121.1 million, or 1.83% of total loans. Newell said about $40 million of reserves were allocated specifically to the bank’s income-producing office portfolio.
Curley said he has personally visited almost all special mention and substandard relationships greater than $7 million, along with several larger watch relationships. “What I found was not a portfolio full of surprises,” he said. “I found a portfolio with known issues, active resolution plans, and teams focused on executing against them.”
Balance sheet and funding strategy Eagle continued to reduce its commercial real estate exposure. Newell said CRE loans declined by $1.7 billion year-over-year, while deposits associated with that portfolio fell by only $152 million. That improved the CRE portfolio deposit funding ratio to 36%, up from 27% a year earlier.
Period-end deposits declined $406.4 million from the prior quarter, driven mainly by lower savings, money market and brokered time deposits. Brokered deposits fell $301.5 million as Eagle reduced reliance on higher-cost wholesale funding. Noninterest-bearing deposits increased to $1.56 billion, up 5.2% from the prior quarter.
Net interest income declined $1.3 million to $62.4 million, reflecting CRE payoffs and a smaller average earning-asset base, partially offset by improved funding mix. Net interest margin expanded five basis points to 2.52%.
Curley said one of his major priorities is improving the bank’s funding profile and building relationship-based core deposits before returning to stronger loan growth. “Too often, banks start by growing loans and then figuring out how to fund them,” he said. “We’ll take the opposite approach.”
Operating performance improves despite credit costs Pre-provision net revenue increased $1.4 million from the prior quarter to $29.1 million. Noninterest expense declined $4.7 million to $44 million, mainly because of lower FDIC insurance expense tied to improved risk and performance metrics and reduced expenses related to loan dispositions. The efficiency ratio improved to 60.2% from 63.8% in the prior quarter.
Newell said year-to-date pre-provision net revenue to average assets was about 109 basis points, an improvement from 2025 and a step toward the company’s intermediate target of roughly 150 basis points.
For 2026, management revised its outlook for average deposits, average loans and average earning assets to reflect first-half reductions, but Newell said the revisions do not assume continued declines in the second half. The bank narrowed its net interest margin outlook to 2.6% to 2.7% and improved its noninterest expense outlook to a decline of 7% to 11% year-over-year. Eagle continues to expect noninterest income growth of 15% to 25% for the year.
C&I growth remains a bright spot Management pointed to commercial and industrial lending as an area of momentum. Newell said C&I loans increased 24% year-over-year, with diversified production and strong credit quality.
Evelyn Lee, chief C&I lending officer, said the bank has benefited from its reputation in the Washington metropolitan area and from hiring experienced bankers. Looking ahead, she said normalized C&I growth would likely be in the “high single digits, low double digits.”
Lee said the C&I strategy is focused on new primary relationships rather than participations, with treasury management growth serving as an indicator of deeper client relationships. She said typical C&I relationships are generally between $5 million and $10 million in exposure, while new production can range from about $7 million to $15 million or $20 million.
In commercial real estate, Ryan Riel, chief real estate lending officer, said the bank expects to stabilize balances in the second half of 2026 but does not expect growth before year-end. Curley added that the company aims to “arrest the decline in the balance sheet” in the back half of the year and return to a growth footing in 2027.
Capital and turnaround priorities Curley said capital is another area under review, though he did not provide specific targets or potential actions. He described capital as “a strategic asset” and said the company is evaluating capital levels, flexibility and ways to create long-term shareholder value.
He also said Eagle is recruiting a new chief credit officer and beginning the search for a chief human resources officer following a planned retirement. The bank plans to continue investing in technology, processes and capabilities while remaining disciplined on expenses.
Asked by analysts about the most immediate opportunity at Eagle, Curley said the key task is stopping the balance-sheet decline. “I’ve never seen a bank shrink to greatness,” he said. He added that the company has opportunities to resume disciplined CRE lending, expand business banking and improve branch productivity.
Curley closed the call by saying his objective is not to remake the company, but to strengthen it. “My objective isn’t to create a different EagleBank,” he said. “It’s to build a stronger EagleBank.”
About Eagle Bancorp (NASDAQ:EGBN)Eagle Bancorp, Inc is the bank holding company for EagleBank, a commercial bank headquartered in Bethesda, Maryland. Since its founding in 1998, the company has focused on serving businesses and consumers in the Washington, DC metropolitan area. EagleBank operates a network of full-service branches and commercial banking centers, providing personalized financial solutions to corporate, nonprofit, real estate and individual clients.
The company's product portfolio includes commercial real estate lending, construction and land development financing, small business administration (SBA) loans, commercial and industrial credit facilities, and residential mortgage loans.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
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Old Second Bancorp NASDAQ: OSBC reported higher second-quarter earnings and an expanded net interest margin, while management said credit metrics improved despite elevated charge-offs tied largely to previously discussed problem loans.
The Aurora, Illinois-based bank holding company posted GAAP net income of $28.2 million, or $0.54 per diluted share, for the second quarter of 2026, Chairman, President and CEO James Eccher said on the company’s earnings call. Return on assets was 1.65%, while return on average tangible common equity was 15.58%. The company’s tax-equivalent efficiency ratio was 51.72%.
Excluding certain adjusting items, including mortgage servicing rights valuation adjustments and costs related to the 2025 acquisition of Bancorp Financial and its Evergreen Bank Group subsidiary, Old Second earned $28.7 million, or $0.55 per diluted share, Eccher said.
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Margin Expands as Net Interest Income Rises Chief Operating Officer and Chief Financial Officer Brad Adams said net interest income increased to $83.3 million from $81.1 million in the prior quarter and was up $19 million, or nearly 30%, from the year-earlier period.
The bank reported a tax-equivalent net interest margin of 5.23% for the second quarter, up 9 basis points from the linked quarter and 38 basis points from the prior-year quarter. Eccher said the increase reflected higher average balances, lower average time deposit balances, higher short-term rates and repricing of lower-yielding loans originated in 2021 and 2022.
Adams characterized the margin as “ridiculously good,” noting that tax-equivalent loan yields increased 12 basis points and securities yields rose 6 basis points during the quarter. He said the improvement was partly driven by increases in rates along the curve, particularly SOFR and overnight index swap rates, following geopolitical instability.
Total cost of deposits was 100 basis points in the second quarter, compared with 105 basis points in the first quarter and 84 basis points in the second quarter of 2025. Adams said competition for both loans and deposits remains “very robust,” with deposit competition running “pretty significantly above” the Fed funds and Treasury curves.
Looking ahead, Adams said margin trends still appeared stable in the near term, though he suggested the bank could give back a few basis points. In response to an analyst question, he estimated the margin could be around 5.18% in the third quarter and 5.15% in the fourth quarter, while cautioning that market conditions could change.
Loan Growth Returns After Seasonal Declines Total loans increased $60.6 million during the quarter, partially reversing seasonal declines from the first quarter. The loan-to-deposit ratio rose to 96.4% as of June 30, compared with 93.2% at the end of the prior quarter and 83.3% a year earlier.
Adams said loan origination activity reflected a seasonal increase, and the pipeline remained strong. However, he said tariffs and uncertainty related to the war in Iran had caused some borrowers to remain cautious about capital projects. He maintained the company’s full-year loan growth target in the low- to mid-single-digit range, with “a little bit more of a bias” toward the low-single-digit level.
Eccher said second-quarter loan growth came from several areas, including middle-market commercial and industrial lending, commercial real estate, sponsored finance and the powersports portfolio. He said competition remains “fierce,” but management is encouraged by current pipelines.
Charge-Offs Elevated, But Credit Metrics Improve Old Second recorded $9.2 million of net loan charge-offs in the second quarter. Eccher said the charge-offs primarily included two credits that management had discussed on the previous quarter’s call: a $3 million commercial and industrial charge-off related to a warehousing and distribution business, and a $2.8 million commercial real estate investor charge-off tied to an office property in a western suburb of Chicago.
The office property was an acquired credit that had been restructured into an A/B note in 2023 due to challenges in the office market. Eccher said the B note had previously been fully secured by collateral value but recently experienced a decline in value, leading management to conclude its collectibility was in doubt and charge it off. He added that the property continues to generate enough cash flow to support the A note at this time.
Net charge-offs related to the powersports business totaled $2.8 million, down $1.1 million from the prior quarter. Eccher said seasonal patterns typically result in higher usage of ATVs and UTVs during the spring and summer, improving collateral outcomes, and he noted that the business’s contribution margin remained strong.
Despite the charge-offs, management emphasized improvement in broader credit trends. Non-performing loans declined by $19 million, classified assets fell by $16.5 million and non-performing assets decreased 25% during the quarter, Eccher said. Special mention loans declined by $12.5 million, from about $40 million to $27 million, a reduction he called an encouraging leading indicator.
The allowance for credit losses on loans stood at $70.4 million, or 1.34% of loans, at June 30, compared with $72.1 million, or 1.39% of loans, at March 31. Eccher said unemployment and GDP assumptions used in the bank’s loss modeling were largely unchanged from the prior quarter, while tariff volatility and the war in Iran continued to be considered in the model.
On the outlook for credit, Eccher said the company is “really close to having a very clean quarter on the credit front,” though it is still working through a couple of credits. He said charge-offs could move back toward a 35- to 45-basis-point range, while acknowledging that the powersports portfolio may keep levels somewhat higher.
Fee Income, Expenses and Capital Non-interest income increased $631,000, or 5%, from the prior quarter and rose $2.4 million, or 21.7%, from the year-earlier period. Eccher said wealth management had a strong quarter, with income up $245,000 from the linked quarter and $525,000 from the prior-year period. Mortgage banking income increased $97,000 sequentially and $543,000 from a year earlier, primarily due to mortgage servicing rights mark-to-market valuations.
Total non-interest expense increased $1 million from the prior quarter, driven by higher officer incentive and employee insurance costs, elevated OREO expenses and GAP insurance refunds related to legacy Evergreen activity. Adams said he did not see material expense pressures from upcoming investments, saying capital projects are already reflected in the run rate.
Tangible book value per share increased to $14.77 from $14.35 in the prior quarter. The tangible equity ratio rose to 11.19% from 11.07%, while Common Equity Tier 1 capital was 13.28%, up from 13.13% in the first quarter but down from a year earlier due mainly to stock repurchases.
Adams said Old Second repurchased 732,000 shares during the second quarter at an average price of $21.08, reducing equity by $15.4 million and adding about $0.01 to earnings per share. Year-to-date repurchases totaled 1.9 million shares at an average price of $20.31. After exhausting its prior authorization, the board approved a new plan to repurchase about 2.5 million shares through June 30, 2027.
Adams said management expects to remain “active and aggressive” with buybacks given the company’s capital position. He also said Old Second remains interested in well-priced mergers and acquisitions that add to franchise value, though management currently has a bias toward smaller transactions.
Eccher closed the call by saying the bank is “cautiously optimistic” because of improved credit metrics and remains optimistic about loan growth and potential strategic growth opportunities.
About Old Second Bancorp (NASDAQ:OSBC)Old Second Bancorp, Inc is a bank holding company based in Aurora, Illinois, serving businesses and consumers through its primary subsidiary, Old Second National Bank. The company provides a broad range of commercial and retail banking services across the suburban Chicago marketplace, supported by a branch network and online platforms designed to meet the financial needs of local communities.
In its commercial banking division, Old Second offers lending solutions that include lines of credit, term loans, equipment financing and commercial real estate financing.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
Should You Invest $1,000 in Old Second Bancorp Right Now?Before you consider Old Second Bancorp, you'll want to hear this.
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Quantum computing stocks spent late 2025 sprinting for the ceiling, but now they're rediscovering gravity. IonQ (IONQ -1.13%) is down 37% over the past month, and D-Wave Quantum (QBTS -1.01%) has fallen by 28% in the same period. Even shares of Nvidia (NVDA -1.40%), which doesn't directly compete in quantum computing despite significant indirect participation, have been drifting sideways as investors rebalance the artificial intelligence (AI) trade.
So are the two beaten-down pure plays worth buying on the dip, or is it better to just buy Nvidia?
Image source: Getty Images.
How the pure plays size up The first thing to know about IonQ and D-Wave is that they're both banking on the federal government as a major customer, both now and in the future, just like many other quantum computing businesses.
IonQ has over $100 million in Air Force Research Lab contracts, plus extensive DARPA and Oak Ridge work queued up. D-Wave has a $1.6 million National Science Foundation (NSF) grant, and a $100 million letter of intent for future spending under the Chips Act -- but that's not the same as an order from a paying customer, at least not yet.
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In terms of revenue, IonQ brought in $64.7 million in the first quarter of 2026, up 755% year over year, and raised its full-year guidance to between $260 million and $270 million. So it's not having much of a problem finding sources of growth, though there's still no timeline on when it might be profitable.
D-Wave's revenue was only $2.9 million in the same quarter, down 81% compared to a year ago, thanks to a one-time $12.6 million system sale last year, though its Q1 bookings jumped to $33.4 million. It presently looks highly reliant on the proposed Chips Act funding to fill out its top line, as its core revenue isn't growing much, even after taking into account the big sale from 2025.
Both of these companies are highly risky investments, and they might not ever be profitable enough to return capital to investors.
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For the moment, they're more reliant on narratives and catalysts than their progress toward profitability, as even starting down that road is at least a handful of years into the future for both. Among these two, IonQ thus has a fair bit more traction and $3.1 billion in cash and equivalents, whereas D-Wave only has $588 million.
Why Nvidia is the smarter call Nvidia isn't as exposed to quantum computing as IonQ or D-Wave; its intention is to create foundational resources that will drive demand for its graphics processing units (GPUs) and enable it to market various software and hardware solutions specifically for hybrid quantum-classical setups.
To that end, in October 2025, the company launched NVQLink, an interconnect that links quantum processors to GPUs for real-time error correction and hybrid workloads. Seventeen quantum hardware developers signed on, including IonQ and several of its competitors. CUDA-Q, Nvidia's open-source hybrid programming platform, is the control surface for NVQLink.
The effect of this positioning is that every serious quantum program now needs racks of Blackwell GPUs alongside its qubits. Nvidia doesn't have to pick a quantum winner to build hardware for, because they all already run on its hardware.
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But, as good as that sounds, it won't move the needle for Nvidia stock in the near term.
It generated $81.6 billion in revenue in the fiscal first quarter of 2027, with $75.2 billion of that sum from its data center segment. The entire quantum computing industry is thus, for Nvidia, mostly optionality that's bolted onto a business already generating extraordinary sales and cash flow. It's seeding the growth markets that it wants to sell to today at a small scale, and potentially at a much larger scale in the future.
Therefore, Nvidia is going to win in quantum computing, whether IonQ, D-Wave, one of their peers, or none of them end up solving their various major technical hurdles. It's almost certainly a better purchase than either of the two pure plays, and it's much lower-risk in comparison.
If you are looking for a stock that has a solid history of beating earnings estimates and is in a good position to maintain the trend in its next quarterly report, you should consider Prosperity Bancshares (PB - Free Report) . This company, which is in the Zacks Banks - Southwest industry, shows potential for another earnings beat.
This financial holding company has an established record of topping earnings estimates, especially when looking at the previous two reports. The company boasts an average surprise for the past two quarters of 3.89%.
For the most recent quarter, Prosperity Bancshares was expected to post earnings of $1.41 per share, but it reported $1.5 per share instead, representing a surprise of 6.38%. For the previous quarter, the consensus estimate was $1.44 per share, while it actually produced $1.46 per share, a surprise of 1.39%.
Price and EPS Surprise
For Prosperity Bancshares, estimates have been trending higher, thanks in part to this earnings surprise history. And when you look at the stock's positive Zacks Earnings ESP (Expected Surprise Prediction), it's a great indicator of a future earnings beat, especially when combined with its solid Zacks Rank.
Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be as high as seven.
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.
Prosperity Bancshares currently has an Earnings ESP of +1.76%, which suggests that analysts have recently become bullish on the company's earnings prospects. This positive Earnings ESP when combined with the stock's Zacks Rank #3 (Hold) indicates that another beat is possibly around the corner. We expect the company's next earnings report to be released on July 29, 2026.
Investors should note, however, that a negative Earnings ESP reading is not indicative of an earnings miss, but a negative value does reduce the predictive power of this metric.
Many companies end up beating the consensus EPS estimate, though this is not the only reason why their shares gain. Additionally, some stocks may remain stable even if they end up missing the consensus estimate.
Because of this, it's really important to check a company's Earnings ESP ahead of its quarterly release to increase the odds of success. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
Have you been searching for a stock that might be well-positioned to maintain its earnings-beat streak in its upcoming report? It is worth considering Advance Auto Parts (AAP - Free Report) , which belongs to the Zacks Automotive - Retail and Wholesale - Parts industry.
This auto parts retailer has seen a nice streak of beating earnings estimates, especially when looking at the previous two reports. The average surprise for the last two quarters was 103.60%.
For the most recent quarter, Advance Auto Parts was expected to post earnings of $0.39 per share, but it reported $0.77 per share instead, representing a surprise of 97.44%. For the previous quarter, the consensus estimate was $0.41 per share, while it actually produced $0.86 per share, a surprise of 109.76%.
Price and EPS Surprise
For Advance Auto Parts, estimates have been trending higher, thanks in part to this earnings surprise history. And when you look at the stock's positive Zacks Earnings ESP (Expected Surprise Prediction), it's a great indicator of a future earnings beat, especially when combined with its solid Zacks Rank.
Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be as high as seven.
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.
Advance Auto Parts currently has an Earnings ESP of +8.04%, which suggests that analysts have recently become bullish on the company's earnings prospects. This positive Earnings ESP when combined with the stock's Zacks Rank #2 (Buy) indicates that another beat is possibly around the corner.
With the Earnings ESP metric, it's important to note that a negative value reduces its predictive power; however, a negative Earnings ESP does not indicate an earnings miss.
Many companies end up beating the consensus EPS estimate, though this is not the only reason why their shares gain. Additionally, some stocks may remain stable even if they end up missing the consensus estimate.
Because of this, it's really important to check a company's Earnings ESP ahead of its quarterly release to increase the odds of success. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
Key Takeaways Acute Care and Behavioral Health growth to support UHS' Q2 revenues and admissions.Universal Health faces higher labor, benefits and supply costs that could pressure quarterly margins.Acute Care revenues are projected to rise 6.1%, with operating income expected to increase 17.5%. Hospital operator Universal Health Services, Inc. (UHS - Free Report) is set to report second-quarter 2026 results on July 27, 2026, after the closing bell. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings is currently pegged at $5.66 per shareon revenues of $4.52 billion.
The second-quarter earnings estimate witnessed no movement over the past 60 days. The bottom-line projection indicates a year-over-year increase of 5.8%. The Zacks Consensus Estimate for quarterly revenues suggests year-over-year growth of 5.5%.
Image Source: Zacks Investment Research
For the full-year 2026, the Zacks Consensus Estimate for Universal Health’s revenues is pegged at $18.54 billion, implying a rise of 6.8% year over year. Meanwhile, the consensus mark for full-year EPS is pegged at $23.44, implying growth of 7.8% on a year-over-year basis.
Universal Health beat the consensus estimate for earnings in three of the last four quarters and missed once, with the average surprise being 9.5%. This is depicted in the figure below.
Q2 Earnings Whispers for UHSOur proven model does not conclusively predict an earnings beat for the company this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the odds of an earnings beat. That’s not the case here.
UHS currently has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
What’s Shaping UHS’ Q2 Results?Universal Health's performance is likely to have been boosted by higher patient days and admissions in both its Acute Care Hospital Services and Behavioral Health Care Services segments.
The Zacks Consensus Estimate for net revenues in the Acute Care Hospital Services segment is pegged at almost $2.55 billion, indicating 6.1% year-over-year growth. The consensus mark for the unit’s same-facility adjusted admissions indicates 2.8% growth from the prior-year quarter.
The Zacks Consensus Estimate for net revenues in the Behavioral Health Care Services segment is pegged at $1.98 billion, indicating a 5.6% increase from the prior-year quarter. The consensus estimate for the unit’s admissions indicates a year-over-year increase of 2.8%.
The Zacks Consensus Estimate for operating income from Acute Care Hospital Services indicates 17.5% year-over-year growth, while the same for Behavioral Health Care Services suggests a 0.9% decrease.
The positives are likely to have been partially offset by rising total operating expenses by nearly 6%, due to higher salaries, wages and benefits, as well as increased costs for supplies in the second quarter, making an earnings beat uncertain. We anticipate salaries, wages and benefits to increase nearly 4% year over year, while other operating costs are expected to escalate 9.3%.
Stocks That Warrant a LookWhile an earnings beat looks uncertain for Universal Health, here are some companies from the broader Medical space that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this time around:
ProMIS Neurosciences, Inc. (PMN - Free Report) has an Earnings ESP of +13.30% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for ProMIS’ bottom line for the to-be-reported quarter of a loss of $1.45 indicates an 80% year-over-year improvement. It has witnessed one upward revision against no downward movement over the past 60 days.
Cardinal Health, Inc. (CAH - Free Report) has an Earnings ESP of +1.24% and a Zacks Rank of 2.
The Zacks Consensus Estimate for Cardinal Health’s bottom line for the to-be-reported quarter suggests 16.4% year-over-year growth. Its earnings beat estimates in each of the past four quarters, with an average surprise of 10.3%. CAH’s revenues for the to-be-reported quarter are pegged at $65.61 billion, a 9.1% increase from the year-ago period.
Alcon Inc. (ALC - Free Report) has an Earnings ESP of +3.13% and a Zacks Rank of 3.
The Zacks Consensus Estimate for Alcon’s bottom line for the to-be-reported quarter indicates a 1.3% increase from a year ago. The company’s earnings beat estimates in three of the trailing four quarters and missed once, with an average surprise of 3.7%. The consensus estimate for ALC’s revenues is pegged at $2.77 billion, signaling a 7.3% increase.
First American Financial Corporation (FAF) Q2 2026 Earnings Call July 23, 2026 11:00 AM EDT
Company Participants
Craig J. Barberio - Vice President of Investor Relations
Mark Seaton - CEO & Director
Matthew Wajner - Executive VP & CFO
Conference Call Participants
Terry Ma - Barclays Bank PLC, Research Division
Oscar Nieves Santana - Stephens Inc., Research Division
Bose George - Keefe, Bruyette, & Woods, Inc., Research Division
Mark DeVries - Deutsche Bank AG, Research Division
Presentation
Operator
Greetings, and welcome to the First American Financial Corporation Second Quarter Earnings Conference Call. [Operator Instructions]
A copy of today's press release is available on First American's website at www.firstam.com/investor. Please note that the call is being recorded and will be available for replay from the company's Investor website and for a short time by dialing (877) 660-6853 or (201) 612-7415 and enter the conference ID 13761705.
We will now turn the call over to Craig Barberio, Vice President, Investor Relations, to make an introductory statement.
Craig J. Barberio
Vice President of Investor Relations
Good morning, everyone, and welcome to First American's Earnings Conference Call for the second quarter of 2026. Joining us today on the call will be our Chief Executive Officer, Mark Seaton; and Matt Wajner, Chief Financial Officer. Some of the statements made today may contain forward-looking statements that do not relate strictly to historical or current fact. These forward-looking statements speak only as of the date they are made, and the company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.
Risks and uncertainties exist that may cause results to differ materially from those set forth in these forward-looking statements. For more information on these risks and uncertainties, please refer to yesterday's earnings release and the risk factors discussed in
If you are looking for a stock that has a solid history of beating earnings estimates and is in a good position to maintain the trend in its next quarterly report, you should consider Enpro (NPO - Free Report) . This company, which is in the Zacks Technology Services industry, shows potential for another earnings beat.
This industrial products maker has an established record of topping earnings estimates, especially when looking at the previous two reports. The company boasts an average surprise for the past two quarters of 3.54%.
For the last reported quarter, Enpro came out with earnings of $2.14 per share versus the Zacks Consensus Estimate of $2.08 per share, representing a surprise of 2.88%. For the previous quarter, the company was expected to post earnings of $1.91 per share and it actually produced earnings of $1.99 per share, delivering a surprise of 4.19%.
Price and EPS Surprise
For Enpro, estimates have been trending higher, thanks in part to this earnings surprise history. And when you look at the stock's positive Zacks Earnings ESP (Expected Surprise Prediction), it's a great indicator of a future earnings beat, especially when combined with its solid Zacks Rank.
Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be as high as seven.
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.
Enpro currently has an Earnings ESP of +0.87%, which suggests that analysts have recently become bullish on the company's earnings prospects. This positive Earnings ESP when combined with the stock's Zacks Rank #2 (Buy) indicates that another beat is possibly around the corner. We expect the company's next earnings report to be released on August 4, 2026.
When the Earnings ESP comes up negative, investors should note that this will reduce the predictive power of the metric. But, a negative value is not indicative of a stock's earnings miss.
Many companies end up beating the consensus EPS estimate, but that may not be the sole basis for their stocks moving higher. On the other hand, some stocks may hold their ground even if they end up missing the consensus estimate.
Because of this, it's really important to check a company's Earnings ESP ahead of its quarterly release to increase the odds of success. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
Growth stocks are attractive to many investors, as above-average financial growth helps these stocks easily grab the market's attention and produce exceptional returns. But finding a great growth stock is not easy at all.
That's because, these stocks usually carry above-average risk and volatility. In fact, betting on a stock for which the growth story is actually over or nearing its end could lead to significant loss.
However, the Zacks Growth Style Score (part of the Zacks Style Scores system), which looks beyond the traditional growth attributes to analyze a company's real growth prospects, makes it pretty easy to find cutting-edge growth stocks.
Hamilton Lane (HLNE - Free Report) is on the list of such stocks currently recommended by our proprietary system. In addition to a favorable Growth Score, it carries a top Zacks Rank.
Research shows that stocks carrying the best growth features consistently beat the market. And returns are even better for stocks that possess the combination of a Growth Score of A or B and a Zacks Rank #1 (Strong Buy) or 2 (Buy).
Here are three of the most important factors that make the stock of this private-market investment firm a great growth pick right now.
Earnings GrowthEarnings growth is arguably the most important factor, as stocks exhibiting exceptionally surging profit levels tend to attract the attention of most investors. And for growth investors, double-digit earnings growth is definitely preferable, and often an indication of strong prospects (and stock price gains) for the company under consideration.
While the historical EPS growth rate for Hamilton Lane is 8.7%, investors should actually focus on the projected growth. The company's EPS is expected to grow 9% this year, crushing the industry average, which calls for EPS growth of 6%.
Impressive Asset Utilization RatioAsset utilization ratio -- also known as sales-to-total-assets (S/TA) ratio -- is often overlooked by investors, but it is an important indicator in growth investing. This metric shows how efficiently a firm is utilizing its assets to generate sales.
Right now, Hamilton Lane has an S/TA ratio of 0.37, which means that the company gets $0.37 in sales for each dollar in assets. Comparing this to the industry average of 0.24, it can be said that the company is more efficient.
While the level of efficiency in generating sales matters a lot, so does the sales growth of a company. And Hamilton Lane looks attractive from a sales growth perspective as well. The company's sales are expected to grow 18.6% this year versus the industry average of 4.5%.
Promising Earnings Estimate RevisionsBeyond the metrics outlined above, investors should consider the trend in earnings estimate revisions. A positive trend is a plus here. Empirical research shows that there is a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
The current-year earnings estimates for Hamilton Lane have been revising upward. The Zacks Consensus Estimate for the current year has surged 1.5% over the past month.
Bottom LineWhile the overall earnings estimate revisions have made Hamilton Lane a Zacks Rank #2 stock, it has earned itself a Growth Score of A based on a number of factors, including the ones discussed above.
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
This combination positions Hamilton Lane well for outperformance, so growth investors may want to bet on it.
Medpace Holdings, Inc. (MEDP) Q2 2026 Earnings Call July 23, 2026 9:00 AM EDT
Company Participants
David Ruhe
August Troendle - CEO, President & Chairman
Kevin Brady - CFO & Treasurer
Conference Call Participants
Charles Rhyee - TD Cowen, Research Division
Michael Cherny - Leerink Partners LLC, Research Division
Ann Hynes - Mizuho Securities USA LLC, Research Division
Jailendra Singh - Truist Securities, Inc., Research Division
Christine Rains - William Blair & Company L.L.C., Research Division
David Windley - Jefferies LLC, Research Division
Ryan Halsted - RBC Capital Markets, Research Division
Eric Coldwell - Robert W. Baird & Co. Incorporated, Research Division
Justin Bowers - Deutsche Bank AG, Research Division
Presentation
Operator
Good day, ladies and gentlemen, and welcome to the Medpace Second Quarter 2026 Earnings Conference Call. [Operator Instructions] As a reminder, this call is being recorded. I would now like to introduce your host for today's conference call, David Ruhe, Medpace's Director of Investor Relations. You may begin.
David Ruhe
Good morning, and thank you for joining Medpace's second quarter 2026 Earnings Conference Call. Also on the call today is our CEO, August Troendle; and our CFO, Kevin Brady. Before we begin, I would like to remind you that our remarks and responses to your questions during this teleconference may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve inherent assumptions with known and unknown risks and uncertainties as well as other important factors that could cause actual results to differ materially from our current expectations. These factors are discussed in our Form 10-K and other filings with the SEC. Please note that we assume no obligation to update forward-looking statements even if estimates change. Accordingly, you should not rely on any of today's forward-looking statements as representing our views as of any date after today.
Medpace Holdings remains a "Buy" as Q2 2026 showed broad metric improvement and an inflection point in growth trajectory. The company's net book-to-Bill ratio rebounded to 1.13x, and backlog conversion rate rose to 24.1%, signaling strong future revenue visibility. Revenue grew 17.2% YoY to $707.3M, with EPS of $4.25 beating expectations; full-year 2026 guidance was raised to $2.805B–$2.885B.
Shares of North America's largest pest control provider Rollins (ROL -10.44%) are down 10% as of noon ET on Thursday after the company reported second-quarter earnings yesterday. While sales grew 8% and beat analysts' expectations on the topline, its 7% adjusted earnings-per-share growth came up short. Organic sales rose by 6% in Q2, and management expects a 6% rise in this organic revenue across the full year, with another two or three percentage points added from acquisitions.
Image source: The Motley Fool.
Ultimately, these results are perfectly fine. However, Rollins was previously trading at 33 times free cash flow (FCF) yesterday -- and 45 times FCF in January -- so the market has had the stock priced for perfection, and it hasn't met these lofty expectations so far this year, sending the stock down 34% in 2026.
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Making matters worse, a Bank of America analyst lowered their price target on Rollins from $55 to $35 following the results, saying the stock no longer deserves a premium valuation given ongoing pressure on the consumer unit. Wall Street expected Rollins residential organic growth to be 5.4%, and it was only 3.6%. Rollins continues to wrestle with the new world of online search in an era where AI is reimagining how things are found online, temporarily (hopefully) harming Rollins' "top of funnel." While certainly concerning, I think investors would be wise to step back and not panic over these results just yet.
Roughly 75% of Rollins' business comes from recurring service agreements rather than strictly residential sales, which often result from a quick online search after discovering an infestation in their attic. That said, it's important for Rollins to solve its search problems, especially after it recently lost a non-compete case before the Federal Trade Commission.
I still believe in Rollins over the long haul, but the market is probably right in taking away its premium valuation for now. However, this is an elite compounder that has grown sales for 99 straight quarters, operates in a must-have niche, and has a long history of dividend growth. I'll be looking to buy the dip.
Bank of America is an advertising partner of Motley Fool Money. Josh Kohn-Lindquist has positions in Rollins. The Motley Fool has positions in and recommends Rollins. The Motley Fool has a disclosure policy.
Key Takeaways KMI topped Q2 2026 earnings and revenue estimates as natural gas transport and gathering volumes increased.Kinder Morgan raised its 2026 adjusted EBITDA and earnings outlook following broad-based segment strength.Kinder Morgan increased its quarterly dividend to 29.75 cents per share and improved leverage to 3.6X. Kinder Morgan, Inc. (KMI - Free Report) reported second-quarter 2026 adjusted earnings of 37 cents per share, beating the Zacks Consensus Estimate of 31 cents by 19.35%. Earnings increased 32.1% from 28 cents in the year-ago quarter.
Revenues increased 10.8% year over year to $4.48 billion from the prior year’s figure of $4.04 billion. Revenues surpassed the consensus estimate of $4.29 billion by 4.43%.
Strong quarterly results benefited from broad-based segment growth, led by higher natural gas transportation and gathering volumes. Natural gas transport volumes rose 7%, while gathering volumes increased 26%.
KMI's Natural Gas Business Leads GrowthNatural Gas Pipelines adjusted segment earnings before depreciation, depletion and amortization (EBDA) expenses increased to $1.46 billion from $1.35 billion a year earlier. Higher contributions from the Texas Intrastate system and gathering assets supported the improvement.
Transportation volumes averaged 47,886 billion British thermal unit per day (BBtu/d) compared with 44,818 BBtu/d in the prior-year quarter. Growth reflected higher LNG deliveries on the Tennessee Gas Pipeline, stronger Texas Intrastate demand, higher export volumes to Mexico and increased power-generation demand in Arizona.
Gathering volumes advanced to 4,637 BBtu/d from 3,692 BBtu/d. KinderHawk volumes rose 54%, supported by increased Haynesville activity. Management noted that the system is effectively full and is adding 1 billion cubic feet per day of treating capacity.
Kinder Morgan's Other Segments AdvanceProducts Pipelines adjusted segment EBDA increased to $339 million from $289 million. Higher commodity prices and stronger butane blending volumes and rates more than offset weaker transportation activity.
Due to a temporary disruption of the West Coast supply and higher commodity prices, total refined product volumes declined 5% to 1.62 million barrels per day (MMBbl/d) from the year-ago figure of 1.71 MMBbl/d. Crude and condensate volumes fell 16% to 421,000 barrels per day (Bbl/d), largely because the Double H system was converted from crude oil to natural gas liquids service.
Terminals adjusted segment EBDA rose to $309 million from $300 million. Higher liquids terminal rates, ancillary fees and favorable commodity pricing supported results. Liquids utilization was 93%, while the Jones Act tanker fleet remained fully contracted for 2026.
CO2 adjusted segment EBDA increased to $207 million from $145 million. Total net oil production increased 10% to 28,040 Bbl/d, driven by a 15% rise in SACROC production. The realized weighted average oil price increased to $73.78 per barrel from $67.60, while the realized weighted average NGL price was $33.38 per barrel, higher than the $32.08 per barrel recorded a year earlier.
KMI's Cost Profile Supports Profit GrowthTotal operating costs, expenses and other expenditures increased 8.3% year over year to $3.13 billion. Costs of sales rose to $1.41 billion from $1.21 billion, while operations and maintenance expenses increased to $806 million from $773 million.
Operating income increased 16.8% to $1.35 billion. The operating margin expanded to 30.1% from 28.5%, reflecting revenue growth that outpaced increases in operating expenses.
Adjusted EBITDA reached a second-quarter record of $2.20 billion, up 12% year over year. Net income attributable to KMI increased 21% to $867 million, while reported earnings rose to 39 cents per share from 32 cents.
Kinder Morgan Expands Project PipelineThe project backlog stood at $9.6 billion at the end of the quarter, down from $10.1 billion sequentially after approximately $660 million of expansion projects entered service. Natural gas projects represented about 92% of the backlog.
The board also granted contingent approval to nearly $400 million of projects that will enter the backlog after contract execution. Management expects to sanction significant additional projects from an opportunity set exceeding $10 billion during the second half of 2026.
Kinder Morgan's Cash Flow & Balance SheetCash flow from operations was $1.96 billion in the quarter. Meanwhile, free cash flow was $978 million and free cash flow after dividends reached $313 million.
As of June 30, 2026, KMI reported $89 million in cash and cash equivalents. Net debt stood at $32.03 billion at quarter-end. The net debt-to-adjusted EBITDA ratio improved to 3.6X from 3.8X at the end of 2025.
KMI Raises 2026 OutlookKinder Morgan expects full-year adjusted earnings before interest, taxes, depreciation, depletion and amortization (EBITDA) to exceed its original $8.6 billion budget by more than 5%. The company also expects adjusted earnings to surpass its initial $1.36-per-share budget by more than 12%.
The revised guidance reflects strong first-half performance across all business segments.
KMI’s Dividend GrowthThe quarterly dividend was raised 2% to 29.75 cents per share, equivalent to $1.19 per share annually. The dividend is payable Aug. 17, 2026, to shareholders of record as of Aug. 3.
KMI’s Zacks Rank & Stocks to ConsiderKinder Morgan currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the energy sector that have yet to release their second-quarter 2026 earnings are Cheniere Energy, Inc. (LNG - Free Report) , Venture Global, Inc. (VG - Free Report) and NOV Inc. (NOV - Free Report) . LNG sports a Zacks Rank #1 (Strong Buy), while NOV and VG carry a Zacks Rank #2 (Buy) each, at present. You can see the complete list of today’s Zacks Rank #1 stocks here.
Houston, TX-based Cheniere Energy is primarily engaged in the liquefied natural gas business. LNG owns and operates major liquefaction and export facilities on the U.S. Gulf Coast, including the Sabine Pass and Corpus Christi terminals.The company is involved in liquefied natural gas and natural gas marketing. With growing demand for cleaner energy, LNG is well-positioned to meet this need through its liquefaction and export facilities. Cheniere Energy is scheduled to release second-quarter 2026 earnings on Aug. 6, 2026.
Venture Global is one of the largest cost-efficient liquefied natural gas exporters in the United States, operating major production facilities along the U.S. Gulf Coast. VG distinguishes itself through a highly efficient, modular construction approach, which enables faster project delivery and massive volumes of reliable natural gas. This innovative strategy allows the company to rapidly scale and meet the world's rising demand for cleaner energy. Venture Global is scheduled to release second-quarter 2026 earnings on Aug. 11, 2026.
Houston, TX-based NOV is a global leader in the design, manufacture and sale of advanced equipment and components used in the oil and gas drilling, production, and renewable energy sectors. By leveraging its extensive proprietary technology portfolio, the company is well-positioned to reduce marginal costs and capitalize on the growing demand for oil and gas in the coming years. NOV is scheduled to release second-quarter 2026 earnings on July 28, 2026.
Resources Investor Relations Journalists Agencies Client Login Send a Release News Products Contact , /PRNewswire/ -- MGIC Investment Corporation (NYSE: MTG) announced that its Board of Directors declared a quarterly cash dividend of $0.17 per share, an increase of 13% from the last quarterly dividend paid of $0.15 per share. This quarter's dividend will be payable on August 20, 2026, to shareholders of record as of August 5, 2026.
About MGIC
Mortgage Guaranty Insurance Corporation (MGIC) (mgic.com), the principal subsidiary of MGIC Investment Corporation, provides mortgage insurance solutions that support responsible credit risk management for mortgage lenders and investors and enable borrowers to qualify for mortgages with lower down payments. As the founder and longstanding leader of today's private mortgage insurance industry, MGIC continues to guide the industry's evolution while serving as a trusted partner to lenders across the country.
From time-to-time MGIC Investment Corporation releases important information via postings on its corporate website, and via postings on MGIC's website, and it intends to continue to do so in the future. Such postings include corrections of previous disclosures and may be made without any other disclosure. Investors and other interested parties are encouraged to enroll to receive automatic email alerts and Really Simple Syndication (RSS) feeds regarding new postings. Enrollment information for MGIC Investment Corporation alerts can be found at https://mtg.mgic.com/shareholder-services/email-alerts. For information about our underwriting and rates, see https://www.mgic.com/underwriting.
Comcast Corporation (NASDAQ:CMCSA, XETRA:CTP2) reported stronger-than-expected second quarter 2026 results on Thursday, with adjusted earnings per share and revenue topping Wall Street expectations, while the company highlighted growth across its connectivity businesses and the first quarterly profit for streaming service Peacock.
The company reported adjusted earnings per share of $1.04 on revenue of $29.94 billion, compared with analyst estimates of $0.97 per share and $29.27 billion in revenue. Adjusted EPS declined 16.7% from $1.25 in the year-ago quarter, while revenue increased 4.7% on a pro forma basis.
“Second quarter results show continued progress against our strategic priorities,” Comcast co-CEOs Brian Roberts and Mike Cavanagh said in a statement. “In Connectivity & Platforms, our strategic pivot in broadband is gaining traction, and we are seeing that progress extend across the broader connectivity portfolio.”
Comcast highlighted its wireless business as a key growth area, reporting its strongest quarter on record with 448,000 domestic wireless customer net additions. Total wireless lines increased to 10.2 million, with penetration remaining below 7% of addressable wireless lines within its footprint.
Within Content & Experiences, Comcast reported that Peacock reached quarterly profitability for the first time, generating $189 million in EBITDA compared with a loss in the prior-year period. Paid subscribers increased by 2 million during the quarter to 48 million, supported by programming including the NBA playoffs, FIFA World Cup and “Love Island USA.”
Media operations delivered mid-single-digit EBITDA growth, while Comcast’s studios business reported higher EBITDA driven by theatrical releases and international distribution. The company highlighted the performance of “The Super Mario Galaxy Movie” and “Obsession,” which contributed to year-over-year studio EBITDA growth of $141 million.
Comcast also noted that FIFA World Cup 2026 coverage drove record engagement across Telemundo and Peacock, with the top 10 most-watched matches in Spanish-language history.
Additionally, the company announced during the quarter its intention to separate NBCUniversal and Sky into two publicly traded companies through a tax-free spin-off. Comcast said the separation is intended to create two focused companies with greater financial flexibility to pursue their respective growth strategies.
Shares of Comcast fell 2% to about $23 following the report.
Key Takeaways Comcast beat Q2 earnings estimates as reported revenues fell 1.2% year over year. CMCSA posted a record wireless quarter, while Peacock reached quarterly profitability for the first time.Comcast plans to separate NBCUniversal and Sky into two publicly traded companies through a tax-free spin-off. Comcast (CMCSA - Free Report) delivered adjusted earnings of $1.04 per share in the second quarter of 2026, down 16.7% from the year-ago period but ahead of the Zacks Consensus Estimate of 97 cents by 7.2%.
Consolidated revenues decreased 1.2% year over year to $29.94 billion but topped the consensus mark of $29.18 billion by 2.6%. On a pro forma basis, reflecting the Versant separation completed on Jan. 2, 2026, and the sale of Sky operations in Germany completed on May 31, 2026, revenues increased 4.7% year over year.
The quarter was shaped by continued traction in the company's go-to-market reset in Connectivity & Platforms, highlighted by the best wireless quarter on record alongside Peacock reaching quarterly profitability for the first time. Comcast also announced its intention to separate NBCUniversal and Sky into two publicly traded companies through a tax-free spin-off.
CMCSA Connectivity Pivot Shows Early TractionConnectivity & Platforms revenues (66.1% of revenues) decreased 3% year over year to $19.8 billion in the reported quarter as pressure in Residential Connectivity & Platforms outweighed continued gains in Business Services Connectivity.
Under the segment, Residential Connectivity & Platforms revenues decreased 4% year over year to $17.12 billion. Business Services Connectivity revenues increased 3.7% year over year to $2.67 billion.
Total Residential Connectivity & Platforms customer relationships decreased 230,000 to 47.7 million, reflecting decreases in both domestic and international customer relationships. Total domestic broadband residential customer net losses were 167,000. Total domestic wireless line net additions were 448,000, marking the company's best quarterly result on record, with total wireless lines rising to 10.2 million. Total domestic video customer net losses were 280,000.
Content & Experiences revenues (35.8% of revenues) increased 22.9% year over year to $10.73 billion, driven primarily by Media and Studios.
Under the segment, Media revenues increased 25.3% year over year to $5.69 billion, including $440 million of incremental revenues from the FIFA World Cup. Peacock reached quarterly profitability for the first time with EBITDA of $189 million, increasing $290 million year over year, while paid subscribers rose by 2 million net additions in the quarter to 48 million, driven by the NBA Playoffs, the FIFA World Cup and Love Island USA.
Studios revenues increased 25% year over year to $3.04 billion, driven by higher theatrical revenues from The Super Mario Galaxy Movie, Obsession and the international distribution of Michael. Theme Parks revenues increased 2.7% year over year to $2.41 billion, reflecting higher revenues at Orlando theme parks, partially offset by lower revenues at international parks.
CMCSA’s Operating DetailsCosts and expenses in the second quarter of 2026 increased 1.9% year over year to $24.78 billion.
Programming and production costs increased 10.7% from the year-ago quarter to $8.39 billion. Marketing and promotion expenses increased 4.2% year over year to $2.26 billion while other operating and administrative expenses rose 0.2% to $10.45 billion.
Adjusted EBITDA decreased 13.4% year over year to $8.9 billion. On a pro forma basis, reflecting the Versant separation and the Sky Germany sale, adjusted EBITDA declined 5.3% year over year.
Total Connectivity & Platforms adjusted EBITDA declined 5.7% year over year to $7.96 billion. Residential Connectivity & Platforms adjusted EBITDA decreased 8% year over year to $6.45 billion, reflecting investment in the new go-to-market strategy. Business Services Connectivity adjusted EBITDA increased 5% year over year to $1.52 billion, with an adjusted EBITDA margin of 56.7%.
Content & Experiences adjusted EBITDA increased 7.1% year over year to $1.33 billion. Media adjusted EBITDA increased 3.7% year over year to $708 million. Studios adjusted EBITDA increased to $202 million from $61 million, driven by strong theatrical performance. Theme Parks’ adjusted EBITDA decreased 5.1% year over year to $609 million.
CMCSA's Cash Flow & LiquidityAs of June 30, 2026, cash and cash equivalents totaled $7.66 billion, which decreased from $9.47 billion as of March 31, 2026.
As of June 30, 2026, consolidated total debt was $90.38 billion, which decreased from $94.61 billion as of March 31, 2026.
Free cash flow was $4.6 billion in the reported quarter, which increased from $4.5 billion in the prior year quarter.
In the second quarter of 2026, Comcast generated $8.09 billion in cash from operations, which increased from $7.82 billion reported in the prior year quarter.
Comcast paid dividends totaling $1.2 billion and repurchased 33.8 million of its shares for $900 million, resulting in a total return of capital to shareholders of $2.1 billion. On June 29 2026, the company announced it would pause its share repurchase program as it works through the separation of its businesses into two independent publicly traded companies.
Zacks Rank & Stocks to ConsiderCMCSA currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader Zacks Consumer Discretionary sector are Cimpress (CMPR - Free Report) , The Marcus (MCS - Free Report) and News Corporation (NWSA - Free Report) , each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Cimpress have returned 45.6% in the year-to-date period. Cimpress is slated to report fourth-quarter fiscal 2026 results on July 29.
Shares of The Marcus have returned 53.5% in the year-to-date period. The Marcus is slated to report second-quarter 2026 results on July 30.
Shares of News Corporation have returned 2.8% in the year-to-date period. News Corporation is slated to report fourth-quarter fiscal 2026 results on Aug. 5.
Comcast Corporation (CMCSA) Q2 2026 Earnings Call July 23, 2026 8:30 AM EDT
Company Participants
Marci Ryvicker - Executive Vice President of Investor Relations
Brian Roberts - Chief Executive Officer, President, Director and Director of Comcast Cable Communications Inc
Michael Cavanagh - Co-CEO & Director
Jason Armstrong - Chief Financial Officer
Steven Croney - Chief Executive Officer of Connectivity & Platforms Division
Presentation
Operator
Good morning, ladies and gentlemen, and welcome to Comcast's Second Quarter Earnings Conference Call. [Operator Instructions] Please note this conference call is being recorded. I will now turn the call over to Executive Vice President, Investor Relations, Ms. Marci Ryvicker. Please go ahead, Ms. Ryvicker.
Marci Ryvicker
Executive Vice President of Investor Relations
Thank you, operator, and welcome, everyone. Joining us on today's call are Brian Roberts, Mike Cavanagh, Jason Armstrong and Steve Croney. I will now refer you to Slide 2 of the presentation accompanying this call, which can also be found on our Investor Relations website and which contains our safe harbor disclaimer. This conference call may include forward-looking statements subject to certain risks and uncertainties. In addition, during this call, we will refer to certain non-GAAP financial measures. Please see our 8-K and trending schedule issued earlier this morning for the reconciliations of these non-GAAP financial measures to GAAP.
With that, I'll turn the call over to Brian.
Brian Roberts
Chief Executive Officer, President, Director and Director of Comcast Cable Communications Inc
Good morning, and thanks, Marci. Before Mike and Jason take you through the quarter, I'd like to spend a few minutes on the separation we announced 3 weeks ago. Since then, we've talked with our key constituencies, employees at every level and most of our key partners, and the reaction has been overwhelmingly positive. I feel more positive and energized today than I was on the day we announced it. What's come through most
Investors interested in Beverages - Soft drinks stocks are likely familiar with Primo Brands (PRMB) and Monster Beverage (MNST). But which of these two stocks offers value investors a better bang for their buck right now?
Key Takeaways Core commissions and fees are expected to rise on new business, renewals and foreign currency benefits. BRO is likely to see higher profit-sharing commissions from stronger underwriting and higher premium volume. Higher compensation, operating, amortization, depreciation and interest costs are expected to lift expenses. Brown & Brown, Inc. (BRO - Free Report) is expected to register an improvement in both top and bottom lines when it reports second-quarter 2026 results on July 27, after the closing bell.
The Zacks Consensus Estimate for BRO’s second-quarter revenues is pegged at $1.72 billion, indicating 34% growth from the year-ago reported figure.
The consensus estimate for the bottom line is pegged at $1.08 per share. The Zacks Consensus Estimate for BRO’s second-quarter earnings has moved south by 0.9% in the past 30 days. The estimate suggests a year-over-year increase of 4.8%.
What the Zacks Model Unveils for BROOur proven model predicts an earnings beat for Brown & Brown this time. This is because the stock has the right combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), which increases the chances of an earnings beat.
Earnings ESP: Brown & Brown has an Earnings ESP of +0.31% at present. This is because the Most Accurate Estimate of $1.09 is pegged higher than the Zacks Consensus Estimate of $1.08. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Brown & Brown currently carries a Zacks Rank #3.
Factors Likely to Shape Q2 Results of BROCore commissions and fees are likely to have benefited from net new and renewal business, acquisitions and an increase from the impact of Foreign Currency Translation.
Profit-sharing contingent commissions are likely to have increased owing to improved underwriting results, increased premium volume and the qualification for certain profit-sharing contingent commissions that did not qualify in the prior year and recent acquisitions.
Net investment income is expected to have benefited from interest income earned from the proceeds of the company’s follow-on common stock offering. The Zacks Consensus Estimate is pegged at $24.7 million.
Net new business written during the preceding 12 months and growth on renewals of existing customers are likely to have aided organic revenues in the Retail segment.
Net new business and exposure unit increases are expected to have aided organic revenues in the Wholesale Brokerage segment.
Expenses are expected to have increased because of higher employee compensation and benefits, other operating expenses, amortization, depreciation and interest expenses.
Other Stocks to ConsiderHere are three other insurance stocks that you may want to consider, as our model shows that these, too, have the right combination of elements to post an earnings beat:
Cincinnati Financial Corporation (CINF - Free Report) has an Earnings ESP of +7.22% and a Zacks Rank #2 at present. The Zacks Consensus Estimate for second-quarter 2026 earnings is pegged at $1.82, indicating a year-over-year decrease of 7.6%. You can see the complete list of today’s Zacks #1 Rank stocks here.
CINF’s earnings beat estimates in each of the last four reported quarters.
The Allstate Corporation (ALL - Free Report) has an Earnings ESP of +2.59% and a Zacks Rank #2 at present. The Zacks Consensus Estimate for second-quarter 2026 earnings is pegged at $5.61, indicating a year-over-year decrease of 5.5%.
ALL’s earnings beat estimates in each of the last four reported quarters.
Axis Capital Holdings Limited (AXS - Free Report) has an Earnings ESP of +3.82% and a Zacks Rank #3 at present. The Zacks Consensus Estimate for second-quarter 2026 earnings is pegged at $3.23, indicating a year-over-year decrease of 1.8%.
AXS’ earnings beat estimates in each of the last four reported quarters.
Parsons’ expanding portfolio of mission-focused products – underpinned by artificial intelligence – complements and enhances the company's broader global solutions offerings across national security and critical infrastructure markets.Products including Cyber Fly-Away Kits, AresNXT™, Javelin®, DroneArmor™, TReX®, Peanut™, iNET®, BlueFly®, GOCaaS™, and OrbitXchange™ demonstrate the company's ability to innovate, commercialize, and scale technologies that support customer missions.Parsons continues to invest in product development and commercialization to deliver repeatable, high-value offerings that drive mission outcomes, long-term growth, and margin expansion.
CHANTILLY, Va., July 23, 2026 (GLOBE NEWSWIRE) -- Parsons Corporation (NYSE: PSN), a leading global solutions provider in the defense, intelligence, and infrastructure markets, today highlighted its growing portfolio of mission-focused products – underpinned by artificial intelligence (AI) – that complement and enhance the company's global solutions and help customers address evolving challenges.
Built on decades of operational experience and customer collaboration, Parsons' product portfolio strengthens the company's ability to deliver integrated solutions across complex mission environments. These technologies provide customers with agile, scalable capabilities that enhance decision-making, improve resilience, and support mission success while creating flexible offerings.
“Our innovation is rooted in continuous advancement and a relentless focus on customer outcomes,” said Ricardo Lorenzo, chief technology officer at Parsons. “Parsons is uniquely positioned to combine deep mission expertise, AI-powered solutions, and scalable technologies to solve complex customer challenges. Through our One Parsons approach, we are extending the strength of our existing solutions portfolio by connecting experts across transportation, cyber and electronic warfare, space and missile defense, water and environment, urban development, and critical infrastructure protection.”
The company’s One Parsons approach leverages global expertise to accelerate innovation, strengthen product development, and deliver greater value for customers. Technologies developed in support of one customer mission can be adapted, integrated, and scaled across multiple markets.
“As the global threat landscape and demands on critical infrastructure continue to evolve, Parsons is expanding a product portfolio built around two urgent missions: securing the infrastructure that communities and economies depend on, and delivering AI-enabled, mission-ready technologies that help protect lives,” said Aaron Wajsgras, vice president of product strategy and commercialization at Parsons. “Every offering is rooted in customer outcomes, turning proven innovation into repeatable solutions that help customers operate with faster decision-making, greater resilience, and a mission-critical advantage.”
Parsons' portfolio spans cyber operations, biometrics and identity management, electronic warfare, counter-unmanned aircraft systems (CUAS), space operations, critical infrastructure protection, border security, and transportation. These offerings are sold directly to customers or integrated into larger company solutions.
Domain Superiority: Cyber Fly-Away Kits, TReX®, and Peanut™
Parsons' national security portfolio includes AI-enabled technologies designed to help customers maintain an operational advantage across cyber, electronic warfare, and contested environments.
Cyber Fly-Away Kits provide rapidly deployable defensive cyber capabilities that support cyber hunt and mission assurance activities.TReX® delivers high-fidelity threat emulation and electronic warfare testing capabilities that help customers prepare for evolving threat environments.Peanut™ provides resilient positioning, navigation, and timing (PNT) capabilities that support operations when traditional GPS signals are degraded, denied, or unavailable.
Securing Critical Infrastructure: DroneArmor™, AresNXT™, Javelin®, BlueFly® and TAKaaS
Parsons helps customers protect global critical infrastructure, public venues, transportation systems, and high-consequence assets through a growing portfolio of security and identity management technologies.
AresNXT™ provides next-generation biometric identity management capabilities that improve security, interoperability, and operational efficiency across mobile and enterprise environments.Javelin® delivers secure identity enrollment and verification capabilities that support law enforcement, public safety, national security, and event security missions.Complementing these offerings, DroneArmor™ provides counter-unmanned aircraft system capabilities that help customers detect, identify, and respond to emerging aerial threats, supporting force protection and critical infrastructure security requirements around the world.BlueFly® search-and-rescue system helps first responders and search teams rapidly locate individuals in a difficult environment.TAKaaS offers comprehensive TAK (Tactical Assault Kit/Team Awareness Kit) development, hosting, integration, fielding, and training services unlocking the full potential of the TAK ecosystem and ensuring mission success and effective operations for militaries, security forces, first responders, and event personnel.
Space Solutions: GOCaaS™ and OrbitXchange™
Parsons expansive portfolio of space-focused technologies support resilient satellite operations.
OrbitXchange™ orchestrates automated access to global antenna networks enabling satellite communications, telemetry, tracking, and command services.GOCaaS™ delivers 24/7 operational satellite operations as a service for any satellite delivering automated telemetry, tracking, commanding, mission management, and data delivery within a secure environment, helping government and commercial customers improve efficiency, resiliency, and mission assurance across increasingly complex space environments. Infrastructure Solutions: iNET®
iNET® is a globally deployed platform that helps transportation agencies around the world connect vehicles, infrastructure, and operational systems to improve mobility, safety, and efficiency. Built on Parsons' deep transportation expertise, iNET® demonstrates how the company's One Parsons approach combines digital innovation, infrastructure delivery, and operational experience to help customers build and secure critical infrastructure worldwide.
Parsons’ smart-mobility and traffic-management expertise extend beyond North America into the Middle East, where the company has delivered major ITS, traffic management centers, and smart-city mobility programs across the UAE, Saudi Arabia, Qatar, Oman, Bahrain, and Kuwait. These programs include integrated corridor management, centralized traffic operations centers, real-time monitoring and analytics, connected ITS devices, and multimodal coordination.
Parsons’ products trace their origins to customer missions around the world and are deployed across government, commercial, and critical infrastructure environments. From transportation agencies operating statewide mobility networks to security professionals conducting identity operations, cyber teams defending critical assets, and space operators supporting national security missions, the company’s solutions help customers solve complex challenges while preparing for future operational demands.
To learn more about Parsons' products and technology solutions, visit Parsons.com/products.
About Parsons:
Parsons (NYSE: PSN) is a leading disruptive technology provider in the national security and global infrastructure markets, with capabilities across cyber and electronic warfare, space and missile defense, transportation, water and environment, urban development, and critical infrastructure protection. Please visit Parsons.com and follow us on LinkedIn to learn how we’re making an impact.
Forward-Looking Statements:
This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are based on our current expectations, beliefs and assumptions, and are not guarantees of future performance. Forward-looking statements are inherently subject to uncertainties, risks, changes in circumstances, trends and factors that are difficult to predict, many of which are outside of our control. Accordingly, actual performance, results and events may vary materially from those indicated in the forward-looking statements, and you should not rely on the forward-looking statements as predictions of future performance, results or events. Numerous factors could cause actual future performance, results and events to differ materially from those indicated in the forward-looking statements, including, among others: any issue that compromises our relationships with the U.S. federal government or its agencies or other state, local or foreign governments or agencies; any issues that damage our professional reputation; changes in governmental priorities that shift expenditures away from agencies or programs that we support; our dependence on long-term government contracts, which are subject to the government’s budgetary approval process; the size of our addressable markets and the amount of government spending on private contractors; failure by us or our employees to obtain and maintain necessary security clearances or certifications; failure to comply with numerous laws and regulations; changes in government procurement, contract or other practices or the adoption by governments of new laws, rules, regulations and programs in a manner adverse to us; the termination or nonrenewal of our government contracts, particularly our contracts with the U.S. federal government; our ability to compete effectively in the competitive bidding process and delays, contract terminations or cancellations caused by competitors’ protests of major contract awards received by us; our ability to generate revenue under certain of our contracts; any inability to attract, train or retain employees with the requisite skills, experience and security clearances; the loss of members of senior management or failure to develop new leaders; misconduct or other improper activities from our employees or subcontractors; our ability to realize the full value of our backlog and the timing of our receipt of revenue under contracts included in backlog; changes in the mix of our contracts and our ability to accurately estimate or otherwise recover expenses, time and resources for our contracts; changes in estimates used in recognizing revenue; internal system or service failures and security breaches; and inherent uncertainties and potential adverse developments in legal proceedings, including litigation, audits, reviews and investigations, which may result in materially adverse judgments, settlements or other unfavorable outcomes. These factors are not exhaustive and additional factors could adversely affect our business and financial performance. For a discussion of additional factors that could materially adversely affect our business and financial performance, see the factors included under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025, and our other filings with the Securities and Exchange Commission. All forward-looking statements are based on currently available information and speak only as of the date on which they are made. We assume no obligation to update any forward-looking statement made in this press release that becomes untrue because of subsequent events, new information or otherwise, except to the extent we are required to do so by law.
What do an HVAC company and a power-and-cooling equipment supplier have in common? Comfort Systems USA (FIX +3.06%) and Vertiv Holdings (VRT +0.77%) are both riding the artificial intelligence (AI) boom thanks to the data center build-out happening behind the scenes.
The market has noticed. Over the past year, Comfort Systems' stock has risen 214%, while Vertiv's has risen 131%. They're tied to AI infrastructure in very different ways, which matters when you're trying to figure out what's really driving the gains.
Two under-the-radar infrastructure plays have already more than doubled. The question now is whether the fundamentals still support the story. Let's find out.
Image source: Getty Images.
What Comfort Systems and Vertiv actually do for AI data centers Comfort Systems is a specialized construction and building services company focused on the systems that make large facilities function. That includes mechanical, electrical, plumbing, HVAC, piping, controls, modular construction, monitoring, and fire-protection services.
Vertiv, on the other hand, sells critical digital infrastructure for data centers. Its products and services help data centers, communication networks, and industrial facilities stay powered, cooled, connected, and running reliably. That includes power-management equipment, thermal-management systems, racks, enclosures, monitoring software, and services that support the full life cycle of a data center.
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Why the AI data center boom needs cooling, power, and building systems Vertiv is the more obvious AI infrastructure pick at first glance. It supplies much of the equipment a data center needs to operate, especially around power and cooling. Comfort Systems takes a step back from the server floor, but it's still in the flow of the same trend.
Data centers generate enormous amounts of heat, and they need effective cooling and building systems to keep uptime high. As hyperscalers build and expand, they turn to companies that can design, install, and service those systems at scale. Comfort Systems has long been a leader in commercial HVAC, and it appears to be one of the biggest players in that market.
Q1 2026 results: The AI build-out is already showing up in earnings The latest results from both companies suggest the AI data center build-out is showing up in financial performance, not just stock charts.
Comfort Systems reported first-quarter 2026 revenue of about $2.9 billion, up 57% year over year. Net income rose 119% to about $370 million. In its Q1 investor presentation, the company pointed to data centers and chip manufacturing as its strongest end markets, followed by life sciences and pharmaceuticals. It also reported a $12.4 billion backlog, up 81% from $6.9 billion last year.
Vertiv also posted strong growth. Q1 2026 revenue increased 30% to about $2.65 billion, and net income climbed 137% to around $390 million. CEO Giordano Albertazzi said the company's ability to meet evolving AI-related demands is driving the growth.
Taken together, these results suggest AI infrastructure spending is already translating into real business momentum for both companies.
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Comfort Systems vs. Vertiv: Which AI infrastructure stock looks better now? So which stock looks more compelling today? At the moment, Comfort Systems appears cheaper, trading at a price-to-earnings ratio of about 49 compared to Vertiv's multiple of about 73. Those are still high multiples, and it's fair to ask whether enthusiasm for AI infrastructure is pushing prices ahead of fundamentals.
The counterpoint is that this has been a common pattern across many AI-adjacent stocks. The bigger question is whether earnings can keep growing fast enough to catch up. If the AI infrastructure build-out stays strong for years, today's valuations may not look so extreme in hindsight.
Wall Street clearly likes both names. Each carries a "strong buy" consensus rating, and both sets of price targets imply roughly 45% to 50% upside over the next year. If I had to choose, Comfort Systems has the edge. It trades at a lower valuation while posting faster revenue and earnings growth than Vertiv, and that record backlog suggests data center-related demand could stay healthy for a while.
After all, when two "hidden" AI infrastructure stocks are already up triple digits in a year, the next move depends less on hype and more on whether the build-out keeps translating into backlog, revenue, and earnings.
Growth stocks are attractive to many investors, as above-average financial growth helps these stocks easily grab the market's attention and produce exceptional returns. However, it isn't easy to find a great growth stock.
By their very nature, these stocks carry above-average risk and volatility. Moreover, if a company's growth story is over or nearing its end, betting on it could lead to significant loss.
However, the task of finding cutting-edge growth stocks is made easy with the help of the Zacks Growth Style Score (part of the Zacks Style Scores system), which looks beyond the traditional growth attributes to analyze a company's real growth prospects.
Our proprietary system currently recommends Vertiv Holdings Co. (VRT - Free Report) as one such stock. This company not only has a favorable Growth Score, but also carries a top Zacks Rank.
Research shows that stocks carrying the best growth features consistently beat the market. And for stocks that have a combination of a Growth Score of A or B and a Zacks Rank #1 (Strong Buy) or 2 (Buy), returns are even better.
While there are numerous reasons why the stock of this company is a great growth pick right now, we have highlighted three of the most important factors below:
Earnings GrowthEarnings growth is arguably the most important factor, as stocks exhibiting exceptionally surging profit levels tend to attract the attention of most investors. And for growth investors, double-digit earnings growth is definitely preferable, and often an indication of strong prospects (and stock price gains) for the company under consideration.
While the historical EPS growth rate for Vertiv is 64%, investors should actually focus on the projected growth. The company's EPS is expected to grow 51.9% this year, crushing the industry average, which calls for EPS growth of 8%.
Cash Flow GrowthCash is the lifeblood of any business, but higher-than-average cash flow growth is more beneficial and important for growth-oriented companies than for mature companies. That's because, high cash accumulation enables these companies to undertake new projects without raising expensive outside funds.
Right now, year-over-year cash flow growth for Vertiv is 41%, which is higher than many of its peers. In fact, the rate compares to the industry average of 10.2%.
While investors should actually consider the current cash flow growth, it's worth taking a look at the historical rate too for putting the current reading into proper perspective. The company's annualized cash flow growth rate has been 31.5% over the past 3-5 years versus the industry average of 7.1%.
Promising Earnings Estimate RevisionsSuperiority of a stock in terms of the metrics outlined above can be further validated by looking at the trend in earnings estimate revisions. A positive trend is of course favorable here. Empirical research shows that there is a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
The current-year earnings estimates for Vertiv have been revising upward. The Zacks Consensus Estimate for the current year has surged 0.3% over the past month.
Bottom LineVertiv has not only earned a Growth Score of A based on a number of factors, including the ones discussed above, but it also carries a Zacks Rank #2 because of the positive earnings estimate revisions.
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
This combination positions Vertiv well for outperformance, so growth investors may want to bet on it.
Berkshire Sells Visa, Domino's, and Pool Corp: Should You Follow?Pool NASDAQ: POOL reported a modest increase in second-quarter 2026 sales while maintaining its adjusted earnings outlook, as recurring maintenance demand and gains in building materials helped offset continued weakness in new pool construction and discretionary spending.
President and CEO John Watwood, speaking on his first earnings call in the role, said the company’s distribution model remains supported by a large installed base of pools, recurring maintenance revenue and a broad branch network that is “difficult to replicate.” He said PoolCorp’s strategy remains focused on growing customer share, increasing network density and improving execution across markets.
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Consumer-Driven Stocks Boost Buybacks, Including Visa's $20B Plan“With our eyes set on crisp execution, I believe we can continue to generate above-market growth and control how we respond to any type of industry backdrop,” Watwood said.
Sales Rise 2% as Maintenance Demand Holds Up PoolCorp reported second-quarter net sales of $1.8 billion, up 2% from a year earlier. CFO Melanie Hart said pricing contributed 3% to sales growth as the company lapped prior-year mid-season vendor price increases.
Willing and Abel: Berkshire's New CEO Makes Huge Portfolio Changes in Q1Watwood said the company benefited from “healthy recurring maintenance demand” tied to its installed base of pools. Building materials sales increased 4%, which he attributed to the company’s national pool trend showrooms, product breadth and support for builders. Equipment sales rose 3% on price and repair-related demand, while chemicals declined 2% because of lower pricing.
Geographically, Europe was a bright spot, with sales up 11% on strong demand and improving sentiment. Watwood said warmer weather and greater consumer investment in backyards contributed to the strength. Seasonal markets grew 6%.
However, PoolCorp continued to face softness in year-round markets. Watwood said sales in California, Texas and Arizona declined by mid-single digits, while Florida was down 1%. He said much of the drag came from the company’s Horizon irrigation and landscape business, which is concentrated in those markets and pressured by slowing residential projects. U.S. pool permits were tracking down low single digits year to date, and discretionary demand remained measured.
Sales to retail customers declined 1%, while Pinch A Penny franchise sales were flat. The company said POOL360, its digital platform, reached 18% of sales, a record level of adoption.
Margins Pressured by Freight and Customer Mix Gross profit increased 1% to $541 million, while gross margin declined 30 basis points year over year to 29.7%. Hart said product mix was neutral, but higher inbound freight costs and an unfavorable customer mix weighed on margins. She said the company saw a higher portion of sales from larger customers, which generally carry lower margins.
“The decline was driven primarily by inbound freight costs, which we were not able to fully recoup in selling price this quarter, and by unfavorable customer mix,” Hart said.
Supply chain gains partially offset those pressures. Hart pointed to progress in private label, exclusive products and expanded building materials offerings. In response to analyst questions, she said inbound freight was “by far the most significant component” of the gross margin pressure.
The company now expects full-year gross margin to be approximately 30 basis points below the prior year, compared with its previous expectation for margins to be in line. Hart said the revised outlook reflects the second quarter’s weight in the full-year results and the continued impact of higher freight and customer mix.
Expense Discipline Supports Earnings PoolCorp reported operating expenses of $273 million, up 4% from a year earlier. Adjusted operating expenses increased 1%, excluding an $8.3 million one-time charge primarily tied to the non-cash acceleration of unvested equity grants related to the CEO transition.
Adjusted operating income increased 1% to $276 million, with an adjusted operating margin of 15.1%. Reported operating income fell 2% to $268 million. Adjusted net income rose 1% to $196 million, while reported net income declined 3% to $188 million.
Adjusted diluted earnings per share were $5.38, up from $5.17 a year earlier. Reported diluted EPS was $5.17 in both periods.
Hart said the company made progress on expense discipline during the quarter, reducing adjusted operating expense growth from 5% in the first quarter to 1% in the second quarter. She said capacity absorption helped keep compensation and outbound freight costs well managed.
Guidance Maintained on Adjusted Basis PoolCorp maintained its underlying adjusted earnings guidance range of $10.87 to $11.17 per share. Including the $0.21 impact from CEO transition expenses, the company updated its diluted EPS range to $10.66 to $10.96.
For the full year, the company expects low single-digit top-line growth, with approximately 2% to 3% from pricing. Hart said pricing benefits are expected to moderate in the second half as the company laps last year’s mid-season price increases. Demand expectations include slight growth in maintenance, some incremental remodel activity and pool builds that remain soft but stable.
Adjusted operating expenses are expected to increase approximately 2% to 3% for the full year, including some incentive compensation recovery from the prior year. Interest expense is still estimated at $49 million to $51 million, and the full-year tax rate is forecast at approximately 25%.
Hart said the company expects cash from operations to come in around 100% of net income for the year. PoolCorp returned capital to shareholders through $93 million in dividends and approximately $86 million in share repurchases year to date. The company has $580 million remaining under its share repurchase authorization.
CEO Outlines Strategic Priorities Watwood outlined four priorities for the company: sales excellence, pricing and supply chain discipline, operational execution, and disciplined mergers and acquisitions. He said the company is focused on equipping sales teams with talent, training and tools, improving chemical and building materials execution, growing private label and proprietary brands, and getting recently opened greenfield locations to their full potential.
On mergers and acquisitions, Watwood said PoolCorp remains focused on tuck-in deals and opportunities that fit the core business, including product-category-specific opportunities, provided they meet strategic, cultural and financial criteria.
Watwood said the company has opened fewer new sales centers this year as it focuses on profitability at locations opened over the past several years. During the quarter, PoolCorp added one location in a key U.S. pool market and closed one Horizon location.
In response to analyst questions about market share, Watwood said PoolCorp has opportunities in building materials, chemicals and other categories by improving customer and supplier connectivity. “We listen to what the market’s telling us, we adjust, we execute on that,” he said. “I think our ability to go gain share is substantial.”
Watwood said the company is operating in a market that appears to be stabilizing, though he noted that a return to stronger long-term growth would require more help from the broader market. PoolCorp plans to provide its next update when it reports third-quarter 2026 results on Oct. 22.
About Pool (NASDAQ:POOL)Pool Corporation is a leading wholesale distributor of swimming pool supplies, equipment, and related outdoor living products. Headquartered in Covington, Louisiana, the company serves a diverse customer base that includes service professionals, independent retailers, high-volume builders, and national retail chains. Pool Corporation's extensive branch network enables it to maintain strong local customer relationships while leveraging its scale to source products efficiently from manufacturers around the world.
The company's product portfolio spans pool and spa chemicals, water treatment equipment, pumps, filters, heaters, automation and control systems, liners, safety covers, and cleaning accessories.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
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The AI boom is creating opportunities across semiconductors, cloud computing, enterprise software, infrastructure, cybersecurity, and automation.
Inside this report, you’ll find 10 companies positioned to benefit as artificial intelligence moves from hype to real-world deployment and becomes a core growth driver for corporate America.
Procore Technologies, Inc. (NYSE: PCOR), the leading global provider of construction management software, today announced three new Digital Coworker packages t
Key Takeaways Dave looks more attractive to add now, while Toast suits investors willing to wait for new initiatives.Dave's revenues rose 47%, as member growth, higher spending and disciplined acquisition fueled momentum.Toast reached 171,000 locations, with rising profitability and growth paths in AI and enterprise markets. Toast, Inc. (TOST - Free Report) and Dave Inc. (DAVE - Free Report) deal with different parts of fintech, but both use software and data to replace older, more expensive systems. Toast has built a broad operating platform for restaurants, combining payments, software, hardware, lending and now AI tools. Dave focuses on consumers who need low-cost banking and short-term liquidity, using its CashAI underwriting system to manage risk and personalize credit access.
Toast offers greater scale, a large merchant network and several paths into enterprise, international and retail markets. Dave is smaller and more concentrated, yet it is growing faster, producing strong margins and expanding beyond ExtraCash into a wider credit relationship.
The key question is not simply which company has the better product. Investors must weigh Toast’s durable platform and wider reach against Dave’s faster operating momentum, sharper unit economics and higher exposure to credit, funding and regulatory risks for diversified long-term portfolios.
The Case for TOSTToast’s advantage is the breadth of its restaurant platform. Its software, payments, hardware and fintech products are deeply tied to daily operations, making the service difficult to replace. The company ended the first quarter with about 171,000 live locations, up 22% year over year, while annualized recurring run-rate rose 26% to $2.2 billion. That scale gives Toast more data and chances to add products.
Toast IQ could deepen that advantage. The assistant uses restaurant-specific sales, labor, menu and guest data, and Toast said operators at more than 125,000 locations used it during the first quarter. Early usage centered on revenue, inventory and marketing questions. While the opportunity is clear, investors still need evidence that engagement becomes sustained revenues rather than simply a useful feature.
Expansion beyond independent restaurants also matters. Hungry Howie’s selected Toast for roughly 500 locations, showing the platform can handle complex enterprise operations. Toast is also building in international markets and supporting hospitality brands operating across the United Kingdom and United States. These moves widen the addressable market, but they bring heavier product, support and sales requirements than the core business.
Financially, Toast is balancing growth with improving profitability. Recurring gross profit increased 27%, adjusted EBITDA reached $179 million, and management raised full-year guidance. Still, GPV per location declined 1%, hardware and services remain a drag, and new markets require continued investment. Compared with Dave, Toast offers diversification and lower credit concentration, but its larger base may make rapid growth harder to sustain.
The Case for DAVEDave’s appeal starts with its growth engine. First-quarter revenues increased 47% to $158.4 million, supported by 18% growth in monthly transacting members and 24% growth in average revenue per user. New-member additions rose 22% to 695,000, while customer acquisition cost stayed at $18. This combination suggests Dave can scale without giving up marketing discipline.
Credit performance makes the story compelling. ExtraCash originations climbed 37% to $2.1 billion, yet the 28-day past-due rate improved to 1.69%, its lowest first-quarter level on record. CashAI appears to be expanding access while keeping losses controlled. Unlike Toast, whose fintech exposure is tied mainly to merchant payments, Dave benefits when underwriting improves, and members use more liquidity products.
The next leg comes from deeper member relationships. Dave Flex, a pay-in-four card product, is being tested as an alternative to traditional credit cards and buy-now-pay-later offers. It uses CashAI and can work across merchants without repeated applications. Revenue contribution is not expected this year, but the product gives Dave a credible route to higher engagement and a larger share of member spending.
The Coastal Community Bank funding arrangement strengthens that route. Moving ExtraCash originations to an off-balance-sheet structure should unlock liquidity and reduce funding costs while allowing Dave to keep investing in growth and repurchases. Adjusted EBITDA rose 57% to $69.3 million, with a 44% margin, and guidance increased. Regulatory, partner and credit risks remain meaningful, but Dave’s faster growth, improving loss trends and expanding product set create the stronger upside case.
How Do Estimates Compare for TOST & DAVE?The Zacks Consensus Estimate for Toast’s 2026 and 2027 sales implies year-over-year growth of 19.95% and 17.84%, respectively. The consensus mark for 2026 and 2027 EPS suggests a year-over-year increase of 51.69% and 27.04%, respectively. Over the past 60 days, estimates for TOST’s 2026 and 2027 EPS have been revised in opposite directions, giving us a mixed view.
For Toast:
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Dave’s 2026 and 2027 sales calls for year-over-year growth of 28.85% and 19.93%, respectively. The consensus estimates for both 2026 and 2027 EPS have been revised upward over the past week. The figures suggest a year-over-year increase of 27.47% and 28.63%, respectively.
For Dave:
Image Source: Zacks Investment Research
Price Performance and Valuation of TOST & DAVEOver the past three months, Dave shares have rallied 54.3%, while Toast shares have risen 0.6%. In comparison, the S&P 500 composite has advanced 4.2% in the same time frame.
Image Source: Zacks Investment Research
TOST is trading at a forward price-to-sales of 1.86X, which is below its one-year median of 2.65X.
Meanwhile, following the share rally, DAVE is presently trading at a forward price-to-sales of 6.82X, which is above its one-year median of 4.53X. Dave’s premium requires rapid growth and clean credit execution.
Image Source: Zacks Investment Research
ConclusionToast remains a fintech platform with strong restaurant reach, rising profitability and credible growth paths in AI, enterprise and international markets. Its broad ecosystem lowers dependence on any single product, but the company’s size and expansion spending may limit near-term upside. Dave carries greater credit, regulatory and bank-partner risk, yet its growth, acquisition efficiency, improving past-due rates and widening product lineup provide a more powerful earnings path.
For investors choosing between the two, Dave looks like the more attractive position to add now, while Toast appears better suited for existing shareholders who are comfortable waiting for newer initiatives to mature.
While TOST carries a Zacks Rank #3 (Hold), DAVE sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The U.S. energy sector has outperformed in 2026, driven primarily by geopolitical-related supply fears, elevated oil prices, and rising demand from the AI infrastructure buildout. While broad energy funds have also surged, investors can potentially enhance exposure by targeting specific segments of the energy market.
Key Takeaways Geopolitical supply concerns, elevated crude oil prices, and AI infrastructure energy demand have driven the U.S. energy sector’s strong 2026 performance. While broad market ETFs like the State Street Energy Select Sector SPDR ETF (XLE) and the Vanguard Energy ETF (VDE) provide core exposure, investors can potentially capture higher returns by specifically targeting different segments of the oil and gas value chain. Upstream firms capitalize on rising crude prices, while midstream companies generate steady income through fee-based models. Downstream refiners capture gains when widening crack spreads boost refining margins. Broad Market Energy Funds The State Street Energy Select Sector SPDR ETF (XLE) covers the broader oil and gas value chain by tracking the S&P Energy Select Sector Index (IXE). Integrated majors ExxonMobil (XOM) and Chevron Corporation (CVX) make up over 35% of portfolio allocations. The fund has generated a year-to-date total return of 32.63% through July 21, with inflows of $3.5 billion.
The Vanguard Energy ETF (VDE) takes a similar broad market approach, tracking the MSCI US Investable Market Energy 25/50 Index. ExxonMobil and Chevron Corporation also collectively make up roughly 35% of the portfolio. VDE has risen 33.09% so far this year, receiving inflows of $720.25 million.
Capitalizing on Elevated Crude Oil Prices Exploration & production (E&P) firms have benefited significantly from elevated crude oil prices. These upstream firms focus on finding, extracting, and selling the oil, making their performance heavily dependent on crude oil prices. The U.S. crude oil benchmark (WTI) is up 47.88% year to date through July 21, allowing E&P firms to sell the same crude oil at higher prices, directly boosting cash flows.
Funds such as the State Street SPDR S&P Oil & Gas Exploration & Production ETF (XOP) provide exposure to these upstream firms. XOP tracks the S&P Oil & Gas Exploration & Production Select Industry Index, which provides equal-weighted exposure across over 50 U.S. E&P firms. XOP has climbed 38.90% in 2026 and has seen inflows of $889.62 million.
For targeted exposure to E&P producers in Texas, investors can turn to the Texas Capital Texas Oil Index ETF (OILT). This fund tracks the Alerian Texas Weighted Oil and Gas Index (ATXWO), using an economic-value weighted strategy. Individual holdings are weighted by the volume and value of oil and gas produced in Texas, with a cap of 10% for any single holding. OILT has gained 30.91% year to date as oil prices remain elevated.
The VanEck Oil Services ETF (OIH) targets the 25 most liquid companies involved in upstream oil and gas services. The fund tracks the MVIS US Listed Oil Services 25 Index (MVOIH), with heavy weighting towards the fund’s top holdings. Its top holding, SLB Limited (SLB), sits at a 19.00% portfolio weight as of July 21, while the second largest holding, Baker Hughes Company (BKR), maintains a 11.93% weight. OIH primarily invests in U.S. companies, with approximately a quarter allocated to U.S. listed foreign companies. The fund has returned 34.67% in 2026, seeing inflows of $193.89 million over the same period.
Midstream Income and Stability While upstream producers directly benefit from elevated oil prices, midstream firms maintain stable cash flows from their fee-based business models, largely insulated from commodity price volatility. The midstream sector has performed strongly in 2026, driven by stable income, power demand from AI infrastructure projects, and record liquefied natural gas (LNG) exports.
The Alerian Energy Infrastructure ETF (ENFR) delivers midstream exposure through the Alerian Midstream Energy Select Index (AMEI), a composite of North American energy infrastructure companies. ENFR maintains a portfolio of roughly 30 holdings with larger firms holding higher portfolio weights. The fund has gained 29.38% with inflows of approximately $70 million year to date.
For investors seeking pure exposure to midstream MLPs, the Alerian MLP ETF (AMLP) is composed of 100% MLPs. The fund tracks the Alerian MLP Infrastructure Index (AMZI), which is a capped, float-adjusted, capitalization-weighted composite of energy infrastructure MLPs that earn most of their cash flow from midstream activities. AMLP has climbed 20.30% year to date with inflows of $604 million. MLPs have attracted significant investor interest due to their track record of providing generous quarterly distributions, which provide a stable stream of income.
Capturing Crack Spreads Downstream Looking downstream, oil refiners have performed strongly in 2026. Global supply constraints are widening the crack spread between crude oil and refined fuels, creating elevated profit margins for oil refiners. However, it’s important to note that if crude oil prices spike too quickly, refiners often can’t pass the full cost on to consumers, causing their margins to shrink.
The VanEck Oil Refiners ETF (CRAK) captures this elevated crack spread by tracking the MVIS Global Oil Refiners Index (MVCRAK). The index provides global pure-play exposure to roughly 30 to 35 oil refiners, excluding integrated majors.
For inclusion in the fund, firms must generate at least 50% of revenues from crude oil refining and production of petrochemicals. Holdings are weighted using a modified market capitalization weighting, limiting individual holdings to a maximum portfolio weight of 8%. CRAK has climbed 48.43% in 2026, with inflows of approximately $100 million.
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Key Takeaways Datadog ended Q1 2026 with about 4,550 customers generating more than $100,000 in ARR.56% of customers use four or more products, while 20% use eight or more, boosting lifetime value.More than 6,500 customers use AI integrations, representing roughly 80% of Datadog's ARR. Datadog’s (DDOG - Free Report) enterprise customer base is strengthening its long-term growth trajectory by driving higher recurring revenues and deeper platform adoption. The company ended the first quarter of 2026 with approximately 4,550 customers generating more than $100,000 in annual recurring revenues (ARR), up from 3,770 a year ago. These large customers now account for nearly 90% of total ARR, highlighting the growing contribution of enterprise clients to Datadog's business.
Management also noted several seven-figure and eight-figure customer wins across industries, with many organizations replacing multiple legacy monitoring tools and expanding deployments to 10-16 Datadog products. This trend is reflected in the company's strong cross-selling performance, as 56% of customers now use four or more products, while 20% use eight or more, supporting higher customer lifetime value and durable subscription revenues.
The rapid adoption of AI is creating another growth path, with more than 6,500 customers using one or more AI integrations, representing roughly 80% of ARR. Datadog further strengthened its enterprise proposition at DASH 2026 by introducing more than 100 new AI, observability and security capabilities, including expanded Bits AI functionality and Agent Observability, which should further deepen enterprise adoption and increase wallet share.
However, the company remains dependent on continued enterprise expansion and IT spending. A slowdown in customer spending, weaker macroeconomic conditions or intensifying competition could moderate ARR growth and limit future revenue expansion. Nevertheless, Datadog's expanding enterprise footprint, strong customer retention, continuous platform innovation and the Zacks Consensus Estimate for 26.62% revenue growth in 2026 indicate that its enterprise-led growth story remains firmly intact.
How Are Competitors Faring?Dynatrace (DT - Free Report) and Elastic (ESTC - Free Report) compete with Datadog in enterprise observability, where platform breadth, enterprise expansion and customer retention drive long-term growth.
Dynatrace challenges Datadog through unified AI-powered observability, deterministic AI and its DPS licensing model that drives broader adoption and consumption. The company reported a fourth-quarter fiscal 2026 NRR of 110%, with more than 75% of ARR on its DPS licensing model and strong cross-sell potential. Dynatrace targets enterprise consolidation, autonomous operations and cloud expansion, while Datadog currently outpaces it in enterprise customer growth and retention.
Elastic competes with Datadog by combining observability, security and AI on a unified platform emphasizing consolidation and context-aware AI. The company is expanding enterprise relationships through larger multiyear commitments, $1 million-plus deals and AI-driven observability. Elastic leverages search expertise and platform consolidation to win upsell opportunities, though Datadog maintains stronger enterprise expansion and higher retention metrics.
DDOG’s Share Price Performance, Valuation & EstimatesShares of DDOG have rallied 79.9% over the past six-month period, outperforming the Zacks Internet - Software industry’s decline of 4.8% and the Zacks broader Computer and Technology sector's growth of 12%.
DDOG’s Six-Month Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, DDOG stock is currently trading at a forward 12-month Price/Sales ratio of 18.16X compared with the industry’s 3.96X. DDOG has a Value Score of F.
DDOG’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for 2026 earnings is pegged at $2.41 per share, unchanged over the past 30 days and indicating a 17.56% year-over-year increase.
Image Source: Zacks Investment Research
Datadog stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
