Class I railroads Union Pacific (UNP +1.65%) and CSX (CSX +0.43%) are two prominent companies that transport bulk goods and commodities across the continent on tens of thousands of miles of track.
Railroads are classic industrial stocks, but still a fantastic business to invest in today. The incumbent railroad companies dominate North America, and, combined with regulatory hurdles, make it almost impossible for new entrants to enter the fray. That drives pricing power and strong investment returns. Union Pacific has returned 308% over the past decade, slightly outpacing the S&P 500 index's 326%. Meanwhile, CSX has been a home run, returning over 519%.
But which is the better railroad to own in 2026? There's a ton to like about Union Pacific, but much of that depends on a blockbuster acquisition. That's why CSX remains the better railroad stock in 2026. Here is what you need to know.
Image source: Getty Images.
CSX's operational improvement is the 2026 headline CSX operates approximately 20,000 miles of rail and provides rail and intermodal transport services throughout the eastern and southeastern United States and the Canadian provinces of Ontario and Quebec. CSX appointed Steve Angel as CEO in September 2025. He was the former CEO of Linde, an industrial gases giant where operational efficiency is paramount to success. That influence has shown up pretty quickly. CSX's operating margin rose by 560 basis points year over year in the first quarter of 2026, driven largely by a 6% reduction in operating expenses.
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The company also recently completed its project at the Howard Street Tunnel in Baltimore, which will boost intermodal volumes. Intermodal volumes rose 6% in the first quarter. The market has rewarded the stock with a forward P/E ratio of 24. It's not a very low valuation, certainly not a bargain. That said, it seems fair given analysts' expectation of approximately 10% annualized earnings growth over the next three to five years. It makes CSX a safe, steady investment.
Union Pacific's pending merger could transform the company Union Pacific is larger, with about 32,000 miles of railroad track, but operates in the western and central United States, touching parts of Mexico. It's the only railroad with access to all six gateways between the two countries. It's a major advantage, given the significant manufacturing and trade flows between these nations. However, the big story with Union Pacific right now is its pending $85 billion merger with Norfolk Southern, which both parties agreed to last summer.
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The merger is currently in regulatory review. Regulators could approve, reject, or impose conditions on the merger, such as requiring asset sales. If approved as is, the merger would create a behemoth in the industry. Its railroad would span over 50,000 miles through 43 states, linking roughly 100 ports across North America. The companies expect a decision on the merger sometime in 2027.
Blockbuster acquisitions come with an assortment of risks Even if regulators approve the merger as is, there are several risks that investors should consider with Union Pacific.
The merger is an enormous deal. Union Pacific's market cap is about $157 billion, so this deal dramatically increases the company's size. Such large mergers almost always raise questions about how well the pieces fit together. A rocky post-merger transition could hurt operating efficiency or margins. There will likely be cost savings as Union Pacific cuts redundant expenses, but identifying, cutting, and realizing those savings can take several years.
On top of that, analysts currently see Union Pacific growing earnings by an average of 7% to 8% annually over the next three to five years, and Norfolk Southern growing earnings by an average of 4% to 5% over the same time period. Yet, Union Pacific trades at a forward P/E ratio of about 21 times 2026 earnings estimates. In other words, investors could be better off paying a slightly higher valuation for CSX, a more stable company with a stronger earnings growth outlook.
Union Pacific could look completely different once this merger saga plays out. Until then, you're buying Union Pacific for its merger story and long-term potential, not its current fundamentals. That makes CSX the better railroad stock to buy in 2026.
On June 02, 2026, we present a DCF analysis for Union Pacific Corp UNP , which has shown a price performance of +15.1% year-to-date and +21.6% over the past year. Despite this positive trend, our analysis indicates some caution regarding its current valuation.
DCF Earnings-based intrinsic value of $154.39 vs current price of $263.50 (margin of safety: -70.7%) DCF FCF-based intrinsic value of $152.67 vs current price (second opinion: -72.6% margin of safety) GF Score™ of 92/100 indicates a high reliability of the DCF inputs What Is UNP Worth? DCF Earnings-Based Model The DCF earnings-based model evaluates Union Pacific's intrinsic value based on its expected future earnings growth. We assume a current EPS of $11.90, with a projected growth rate of 6.8% over the next ten years. The discount rate, calculated as the risk-free rate plus an equity risk premium, is set at 11%. After the growth phase, we apply a terminal growth rate of 4% for the subsequent ten years.
Parameter Value Current EPS (TTM, excl. non-recurring) $11.90 10-Year Growth Rate 6.8% 10-Year Treasury Rate 4.43% Discount Rate (ceil(Treasury) + 6%) 11% Terminal Growth Rate 4% In the first stage, we project the EPS growth at 6.8% for ten years, resulting in a discounted value of $96.84 per share. In the second stage, we apply a terminal growth rate of 4% for the next ten years, yielding a discounted value of $57.55 per share. The intrinsic value is thus calculated as follows:
Stage Description Value Growth Stage (Years 1-10) EPS growing at 6.8%, discounted at 11% $96.84 Terminal Stage (Years 11-20) 4% terminal growth, discounted at 11% $57.55 Intrinsic Value Growth + Terminal $154.39 With a current price of $263.50, the intrinsic value of $154.39 indicates that Union Pacific is modestly overvalued, with a margin of safety of -70.7%. It is important to note that GuruFocus utilizes EPS excluding non-recurring items, as research indicates that stock prices are more closely correlated with earnings than with free cash flow. For further calculations, you can visit the UNP DCF Calculator.
What Does the Free Cash Flow DCF Say? When we apply the free cash flow (FCF) DCF model, we arrive at an intrinsic value of $152.67. This value is consistent with the earnings-based intrinsic value of $154.39, reinforcing the conclusion that Union Pacific is modestly overvalued, with a margin of safety of -72.6%.
How Does GF Value™ Compare to the DCF Models? The GF Value™ for Union Pacific is calculated at $244.62, providing a third perspective on the company's valuation. GF Value™ is GuruFocus' proprietary measure derived from historical trading multiples, past business growth, and future performance estimates. While the DCF models suggest that Union Pacific is overvalued, the GF Value™ indicates a different stance, suggesting that the stock may be slightly overvalued at 7.7%. For more insights, visit the GF Value™ page.
What Does UNP's GF Score™ Tell Us? The GF Score™ ranks stocks from 0 to 100 based on five key aspects: Financial Strength, Profitability, Growth, Valuation, and Momentum. Stocks with higher GF Score™ values have been shown to generate higher long-term returns based on backtesting from 2006 to 2021. Union Pacific has a GF Score™ of 92/100, indicating strong fundamentals. The predictability rank is 3/5 stars, suggesting that the DCF model's reliability for this stock is moderate.
Key Assumptions and Limitations It is crucial to recognize that DCF models are highly sensitive to the assumptions made regarding growth rates and discount rates. Stocks with lower predictability ratings tend to produce less reliable DCF estimates. The terminal growth rate of 4% is a simplifying assumption that may not reflect future economic conditions accurately.
What This Means for Investors In synthesizing the three valuation models—DCF earnings, DCF FCF, and GF Value™—the consensus indicates that Union Pacific is overvalued. Investors should exercise caution when considering this stock based on current valuations. For the full DCF analysis, visit the UNP DCF Calculator. You can also explore the GF Value™ page, or use the GuruFocus Stock Screener to find undervalued predictable companies.
Frequently Asked Questions What is UNP's intrinsic value based on DCF?
According to our analysis, the earnings-based intrinsic value is $154.39, while the FCF-based intrinsic value is $152.67.
Is UNP overvalued or undervalued?
Both the DCF models and GF Value™ suggest that UNP is overvalued.
How reliable is the DCF model for UNP?
With a predictability rank of 3/5, the DCF model's reliability for UNP is moderate.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
Marking a milestone in innovation and collaboration, Union Pacific Railroad on Tuesday unveiled its newest commemorative locomotive with Northrop Grumman and Wabtec, as No. 4547 began its first mission hauling Space Launch System solid rocket motor segments for NASA’s Artemis III lunar exploration program.
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20260603422961/en/
Union Pacific Railroad’s newest commemorative locomotive No. 4547 begins its first mission hauling rocket parts for NASA’s Artemis III lunar exploration program.
Departing from a shipping facility near Corinne, Utah, the locomotive carried components supporting NASA’s effort to explore deep space and return humanity to the moon. It was joined by No. 1616, another special commemorative locomotive that honors President Abraham Lincoln and Union Pacific’s rich history. Lincoln founded Union Pacific in 1862 when he signed the Pacific Railway Act, approving construction of the transcontinental railroad.
Union Pacific CEO Jim Vena joined Utah House Speaker Mike Schultz, Utah Senate President J. Stuart Adams, and leaders from Northrop Grumman, NASA and Wabtec for a ceremony marking the shipment and christening of No. 4547, a locomotive that honors President Donald J. Trump and commemorates America’s 250th anniversary.
“We are proud to honor President Donald J. Trump with this commemorative engine while helping advance the Artemis III mission,” Vena said. “As No. 4547 carries these rocket components, it represents the strength of our nation’s supply chain and our role in connecting the country – linking industries, communities and opportunity from our rail network to the surface of the moon.”
“From Northern Utah’s role in building the transcontinental railroad to powering exploration with our Space Launch System boosters, this partnership shows how American industries and innovation are building the future,” said Wendy Williams, vice president and general manager, launch and exploration, Northrop Grumman.
Artemis III is planned as NASA’s second crewed mission in its Artemis lunar exploration program. The mission will test integrated operations between the Orion spacecraft and commercial landers from SpaceX and Blue Origin to lay the groundwork for future missions, including a planned lunar landing as early as 2028.
Built by Wabtec, No. 4547 is the third in Union Pacific’s presidential locomotive series: No. 1616 honors President Abraham Lincoln, who founded Union Pacific in 1862, and No. 4141 recognizes President George H.W. Bush, a noted rail enthusiast.
ABOUT UNION PACIFIC
Union Pacific (NYSE: UNP) delivers the goods families and businesses use every day with safe, reliable and efficient service. Operating in 23 western states, the company connects its customers and communities to the global economy. Trains are the most environmentally responsible way to move freight, helping Union Pacific protect future generations. More information about Union Pacific is available at www.up.com.
NORTHROP GRUMMAN
Northrop Grumman is a leading global aerospace and defense technology company. Our pioneering solutions equip our customers with the capabilities they need to connect and protect the world and push the boundaries of human exploration across the universe. Driven by a shared purpose to solve our customers’ toughest problems, our employees define possible every day.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260603422961/en/
No. 4547 Celebrates America’s 250th Anniversary and is the Third in Presidential Locomotive Series
CORINNE, Utah--(BUSINESS WIRE)--Marking a milestone in innovation and collaboration, Union Pacific Railroad on Tuesday unveiled its newest commemorative locomotive with Northrop Grumman and Wabtec, as No. 4547 began its first mission hauling Space Launch System solid rocket motor segments for NASA’s Artemis III lunar exploration program.
Departing from a shipping facility near Corinne, Utah, the locomotive carried components supporting NASA’s effort to explore deep space and return humanity to the moon. It was joined by No. 1616, another special commemorative locomotive that honors President Abraham Lincoln and Union Pacific’s rich history. Lincoln founded Union Pacific in 1862 when he signed the Pacific Railway Act, approving construction of the transcontinental railroad.
Union Pacific CEO Jim Vena joined Utah House Speaker Mike Schultz, Utah Senate President J. Stuart Adams, and leaders from Northrop Grumman, NASA and Wabtec for a ceremony marking the shipment and christening of No. 4547, a locomotive that honors President Donald J. Trump and commemorates America’s 250th anniversary.
“We are proud to honor President Donald J. Trump with this commemorative engine while helping advance the Artemis III mission,” Vena said. “As No. 4547 carries these rocket components, it represents the strength of our nation’s supply chain and our role in connecting the country – linking industries, communities and opportunity from our rail network to the surface of the moon.”
“From Northern Utah’s role in building the transcontinental railroad to powering exploration with our Space Launch System boosters, this partnership shows how American industries and innovation are building the future,” said Wendy Williams, vice president and general manager, launch and exploration, Northrop Grumman.
Artemis III is planned as NASA’s second crewed mission in its Artemis lunar exploration program. The mission will test integrated operations between the Orion spacecraft and commercial landers from SpaceX and Blue Origin to lay the groundwork for future missions, including a planned lunar landing as early as 2028.
Built by Wabtec, No. 4547 is the third in Union Pacific’s presidential locomotive series: No. 1616 honors President Abraham Lincoln, who founded Union Pacific in 1862, and No. 4141 recognizes President George H.W. Bush, a noted rail enthusiast.
ABOUT UNION PACIFIC
Union Pacific (NYSE: UNP) delivers the goods families and businesses use every day with safe, reliable and efficient service. Operating in 23 western states, the company connects its customers and communities to the global economy. Trains are the most environmentally responsible way to move freight, helping Union Pacific protect future generations. More information about Union Pacific is available at www.up.com.
NORTHROP GRUMMAN
Northrop Grumman is a leading global aerospace and defense technology company. Our pioneering solutions equip our customers with the capabilities they need to connect and protect the world and push the boundaries of human exploration across the universe. Driven by a shared purpose to solve our customers’ toughest problems, our employees define possible every day.
OMAHA, Neb.--(BUSINESS WIRE)--Richard “Dick” Davidson, the former chairman and chief executive officer of Union Pacific Railroad who helped shape the modern railroad by expanding its footprint and advancing its technology, has died at the age of 84.
“Dick dedicated his life to railroading, working his way up from brakeman to CEO,” said Union Pacific CEO Jim Vena. “He loved this industry, believed in railroaders and set a standard for leadership that still guides Union Pacific today. We mourn his loss and extend our deepest condolences to his family and friends.”
A Career Born on the Railroad
Davidson was born on Jan. 9, 1942, in Allen, Kansas. Raised on a family farm by his mother after his father's death when Davidson was six years old, he learned early the values of self-reliance and hard work. To help pay for college, Davidson signed on as a part-time brakeman for the Missouri Pacific Railroad, launching what would become a lifelong career in railroading.
After graduating from Washburn University with a Bachelor of Arts degree, Davidson accepted a position in Missouri Pacific's management training program and rapidly rose through the organization. He continued climbing the ranks, serving as assistant general manager in Kansas City and becoming vice president of operations in 1976.
Leading Union Pacific
When Union Pacific merged with Missouri Pacific in 1982, Davidson became vice president of operations for the combined railroad. He served in a succession of expanding leadership roles before being elevated to president and CEO of Union Pacific Railroad in 1991. He was named chairman and CEO of Union Pacific Corporation in 1997.
During his tenure, Davidson oversaw the acquisitions of Chicago & North Western Railway and Southern Pacific Railroad. The Southern Pacific merger nearly doubled the size of Union Pacific and expanded the railroad's reach in the West and South, but absorbing the struggling railroad created operational challenges. Davidson responded with major investments in capital projects, modernizing the company's technology infrastructure and decentralizing operations. Union Pacific emerged stronger, and the operational framework Davidson put in place endured long after his retirement.
Recognition and Service Beyond the Railroad
Davidson's contributions to American industry were widely recognized. He was inducted into the Horatio Alger Association of Distinguished Americans, named to the Kansas Business Hall of Fame and the Nebraska Business Hall of Fame, and honored as Kansan of the Year by the Native Sons and Daughters of Kansas. He also received an honorary doctorate from Washburn University.
In addition to his positions at Union Pacific, Davidson served as chair of the Greater Omaha Chamber of Commerce, a director at Creighton University, and a member of the boards of the Kroger Company, the Boy Scouts of America, and the Capitol Visitors Center. He also served as chairman of President George W. Bush's National Infrastructure Advisory Board.
Davidson, who lived in Naples, Florida, with his wife Trish, was a loving husband, father and grandfather. A celebration of life will be held at a future date.
ABOUT UNION PACIFIC
Union Pacific (NYSE: UNP) delivers the goods families and businesses use every day with safe, reliable and efficient service. Operating in 23 western states, the company connects its customers and communities to the global economy. Trains are the most environmentally responsible way to move freight, helping Union Pacific protect future generations. More information about Union Pacific is available at www.up.com.
Richard “Dick” Davidson, the former chairman and chief executive officer of Union Pacific Railroad who helped shape the modern railroad by expanding its footprint and advancing its technology, has died at the age of 84.
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20260605641628/en/
Union Pacific Railroad former Chairman and CEO Dick Davidson
“Dick dedicated his life to railroading, working his way up from brakeman to CEO,” said Union Pacific CEO Jim Vena. “He loved this industry, believed in railroaders and set a standard for leadership that still guides Union Pacific today. We mourn his loss and extend our deepest condolences to his family and friends.”
A Career Born on the Railroad
Davidson was born on Jan. 9, 1942, in Allen, Kansas. Raised on a family farm by his mother after his father's death when Davidson was six years old, he learned early the values of self-reliance and hard work. To help pay for college, Davidson signed on as a part-time brakeman for the Missouri Pacific Railroad, launching what would become a lifelong career in railroading.
After graduating from Washburn University with a Bachelor of Arts degree, Davidson accepted a position in Missouri Pacific's management training program and rapidly rose through the organization. He continued climbing the ranks, serving as assistant general manager in Kansas City and becoming vice president of operations in 1976.
Leading Union Pacific
When Union Pacific merged with Missouri Pacific in 1982, Davidson became vice president of operations for the combined railroad. He served in a succession of expanding leadership roles before being elevated to president and CEO of Union Pacific Railroad in 1991. He was named chairman and CEO of Union Pacific Corporation in 1997.
During his tenure, Davidson oversaw the acquisitions of Chicago & North Western Railway and Southern Pacific Railroad. The Southern Pacific merger nearly doubled the size of Union Pacific and expanded the railroad's reach in the West and South, but absorbing the struggling railroad created operational challenges. Davidson responded with major investments in capital projects, modernizing the company's technology infrastructure and decentralizing operations. Union Pacific emerged stronger, and the operational framework Davidson put in place endured long after his retirement.
Recognition and Service Beyond the Railroad
Davidson's contributions to American industry were widely recognized. He was inducted into the Horatio Alger Association of Distinguished Americans, named to the Kansas Business Hall of Fame and the Nebraska Business Hall of Fame, and honored as Kansan of the Year by the Native Sons and Daughters of Kansas. He also received an honorary doctorate from Washburn University.
In addition to his positions at Union Pacific, Davidson served as chair of the Greater Omaha Chamber of Commerce, a director at Creighton University, and a member of the boards of the Kroger Company, the Boy Scouts of America, and the Capitol Visitors Center. He also served as chairman of President George W. Bush's National Infrastructure Advisory Board.
Davidson, who lived in Naples, Florida, with his wife Trish, was a loving husband, father and grandfather. A celebration of life will be held at a future date.
ABOUT UNION PACIFIC
Union Pacific (NYSE: UNP) delivers the goods families and businesses use every day with safe, reliable and efficient service. Operating in 23 western states, the company connects its customers and communities to the global economy. Trains are the most environmentally responsible way to move freight, helping Union Pacific protect future generations. More information about Union Pacific is available at www.up.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20260605641628/en/
CEO Buys, CFO Buys: Stocks that are bought by their CEO/CFOs. Insider Cluster Buys: Stocks that multiple company officers and directors have bought. Double Buys: Companies that both Gurus and Insiders are buying Triple Buys: Companies that both Gurus and Insiders are buying, and Company is buying back.
The so-called Trump Ballroom Tracker, a financial index used to track the companies that have donated to the president’s new ballroom project, has significantly outperformed the market this year.
More precisely, the tracker, launched by Quiver Quantitative on October 27, 2025, has gained roughly 26% so far in 2026. In comparison, the S&P 500 has gone up just 10.82% in the same time period, according to data from the trading platform Autopilot.
In other words, the Trump Ballroom Tracker has outperformed the S&P 500’s gain by 15.18 percentage points. In relative terms, the portfolio has delivered about 140% more than the benchmark index in more or less five months.
Trump donor portfolio tracker vs. S&P 500 YTD. Source: Autopilot (@Autopilot) Most notable Trump Ballroom Tracker gains Several constituents of the Trump Ballroom Tracker have posted substantial gains since October. Most notably, the memory chip maker Micron Technology (NASDAQ: MU) has led the group with a staggering 352.5% return.
Other noteworthy performers include Caterpillar (NYSE: CAT) with a return of 78.4% and Alphabet (NASDAQ: GOOGL) with 38.2%. Also worth mentioning are gainers such as Union Pacific (NYSE: UNP), which is up 20.9%, Apple (NASDAQ: AAPL), up 15.8%, and Amazon (NASDAQ: AMZN), which has gained 11.8%.
However, the performance across the basket has been far from uniform, as several high-profile technology names have not been so fortunate. For instance, Microsoft (NASDAQ: MSFT) is down 19.4%, Meta Platforms (NASDAQ: META) has fallen 16.4%, while Palantir (NASDAQ: PLTR) has lost 25.1% since the tracker debuted. The worst performer, however, was the cryptocurrency exchange Coinbase, which has declined 54.5%.
Still, despite some of the individual holdings performing more poorly than expected, the strength of the overall tracker cannot be denied, even if it remains just an unconventional experiment in measuring the potential market impact of corporate political engagement.
Featured image via Shutterstock
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All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. But for income investors, generating consistent cash flow from each of your liquid investments is your primary focus.
While cash flow can come from bond interest or interest from other types of investments, income investors hone in on dividends. A dividend is the distribution of a company's earnings paid out to shareholders; it's often viewed by its dividend yield, a metric that measures a dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Headquartered in Omaha, Union Pacific (UNP - Free Report) is a Transportation stock that has seen a price change of 15.44% so far this year. The railroad is currently shelling out a dividend of $1.38 per share, with a dividend yield of 2.07%. This compares to the Transportation - Rail industry's yield of 0.74% and the S&P 500's yield of 1.46%.
Looking at dividend growth, the company's current annualized dividend of $5.52 is up 1.5% from last year. Over the last 5 years, Union Pacific has increased its dividend 3 times on a year-over-year basis for an average annual increase of 7.19%. 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. Union Pacific's current payout ratio is 46%, meaning it paid out 46% of its trailing 12-month EPS as dividend.
Looking at this fiscal year, UNP expects solid earnings growth. The Zacks Consensus Estimate for 2026 is $12.54 per share, which represents a year-over-year growth rate of 7.55%.
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. It's important to keep in mind that not all companies provide a quarterly payout.
For instance, it's a rare occurrence when a tech start-up or big growth business offers its shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, UNP 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).
ASML reported solid 4Q25 results and record bookings due to strong AI demand for DRAM and advanced logic, and FY2026 guidance is above consensus. Adyen reported December quarter results slightly below consensus expectations, with net revenue growing 19% y/y. For the Baird Chautauqua International Growth Fund, 60% of companies that reported earnings during the quarter were in line with or exceeded consensus estimates.
HDFC Bank Limited (NYSE: HDB - Get Free Report) was the recipient of a significant drop in short interest during the month of March. As of March 31st, there was short interest totaling 8,143,238 shares, a drop of 21.8% from the March 15th total of 10,414,881 shares. Approximately 0.2% of the shares of the company are
Investors looking for stocks in the Banks - Foreign sector might want to consider either HSBC (HSBC - Free Report) or HDFC Bank (HDB - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
HSBC and HDFC Bank are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. This means that HSBC's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
HSBC currently has a forward P/E ratio of 10.63, while HDB has a forward P/E of 15.59. We also note that HSBC has a PEG ratio of 0.87. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. HDB currently has a PEG ratio of 1.23.
Another notable valuation metric for HSBC is its P/B ratio of 1.51. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, HDB has a P/B of 1.96.
Based on these metrics and many more, HSBC holds a Value grade of B, while HDB has a Value grade of F.
HSBC sticks out from HDB in both our Zacks Rank and Style Scores models, so value investors will likely feel that HSBC is the better option right now.
Invesco EQV International Equity Fund trailed the index primarily due to stock selection in financials and industrials. Stock selection in financials and industrials, along with an underweight and stock selection in energy, detracted the most from relative return. Conversely, an underweight allocation in communication services and stock selection in consumer staples added to relative performance.
A man looks out of a window next to the signboard of HDFC Bank's automated teller machine (ATM) in New Delhi, India, May 5, 2023. REUTERS/Anushree Fadnavis/File Photo Purchase Licensing Rights, opens new tab
SummaryCompaniesChairman resigned in March citing mismatch in values, practicesExit prompted stock rout, RBI statement seeking calmBank likely to seek CEO reappointment after review, source saysSystemically important bank is majority foreign-ownedMUMBAI, May 6 (Reuters) - Law firms reviewing governance at HDFC Bank (HDBK.NS), opens new tab are set to report this month that they have not found any major lapses, two people with direct knowledge of the findings said, clearing the way for the reappointment of its CEO.
India's largest private lender by assets called in Mumbai-based Trilegal and Wadia Ghandy & Co after Atanu Chakraborty resigned as chairman in March citing "incongruence" between his personal values and bank practices. He did not elaborate.
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HDFC Bank shares extended gains on the day to as much as 3.1% at 796.95 rupees after the Reuters report, before easing a little to trade 2.9% higher at 0930 GMT. Shares were trading about 1.8% higher ahead of the Reuters report.
The resignation was followed by a 13.81% drop in the bank's share price, or $16 billion in the stock's value, and prompted a rare statement from the central bank seeking to allay investor and depositor concern about a lender deemed too big to fail.
It also threw into doubt the lender's application at the central bank due May-end to reappoint CEO Sashidhar Jagdishan.
The affair exposed leadership strain at HDFC, a bank majority-owned by foreign institutional investors and which has faced ire over stock that is down 5% since a $40 billion merger with parent HDFC Ltd in 2023. Closest rival ICICI Bank (ICBK.NS), opens new tab has risen 33% in that time and the benchmark Nifty 50 is up 24%.
With 120 million customers and just over a tenth of banking deposits, a clean bill of health from the law firms would bring certainty to a bank whose stability is critical to the economy.
The law firms examined minutes and video recordings of board and extraordinary general meetings over the last three years to ascertain whether Chakraborty had raised governance issues and, if so, how those issues were addressed, the people said, declining to be identified as the findings are not public.
All issues raised at board level were handled as per prescribed processes, one of the people said, without elaborating on those issues.
The law firms are likely to hand their report this month to the board, which will then submit it to the central bank, the person said.
The review findings have not been previously reported.
Chakraborty declined to comment on Reuters' texted queries. HDFC Bank, the Reserve Bank of India, Trilegal and Wadia Ghandy & Co did not respond to emailed requests for comment.
BANK SET TO PROPOSE CEO REAPPOINTMENTThe resignation and review had delayed a board decision on whether to recommend Jagdishan for reappointment as CEO after his three-year term ends in October. The central bank approves lenders' CEO appointments.
HDFC Bank will propose Jagdishan for reappointment after the law firms submit their report, the second person said.
The central bank is of the view that there are no issues that could preclude reappointment, said a third person, who is familiar with RBI thinking. If the review tallies, the RBI would have no problem supporting reappointment, the person said.
After Chakraborty resigned, the central bank said that, on the basis of its periodical assessment, "there are no material concerns on record as regards its conduct or governance".
Proxy advisor InGovern Research Advisory Services last month said the resignation was likely driven by individual personality rather than any threat to shareholder value.
Reporting by Gopika Gopakumar and Jayshree P Upadhyay in Mumbai; Editing by Ira Dugal and Christopher Cushing
Our Standards: The Thomson Reuters Trust Principles., opens new tab
On May 11, 2026, HDFC Bank Ltd HDB shares fell by 3.3%, closing at $24.20. This decline is part of a larger downward trend, with the stock down 33.8% year-to-date and 30.5% over the past year. The shares have traded within a 52-week range of $23.91 to $39.81.
GF Value™ verdict: HDB is currently priced at $24.20, which is 23.3% below its GF Value™ of $31.56.GF Score™: HDB has a GF Score™ of 76/100, indicating it is above average compared to other stocks.Most notable signal: Insiders have sold $0.3 million worth of shares in the last three months, with no buying activity reported. Is HDB Overvalued or Undervalued? With HDFC Bank's current price of $24.20 significantly lower than the GF Value™ estimate of $31.56, the stock appears to be undervalued by 23.3%. This presents a potential opportunity for investors looking for stocks that may be trading below their intrinsic value. The GF Valuation label categorizes HDB as "Modestly Undervalued," suggesting that the stock has a margin of safety for those considering its current valuation.
GF Value™ is GuruFocus' proprietary measure of intrinsic value, calculated from historical trading multiples, past business growth, and future performance estimates. Given the current undervaluation, potential investors might find HDB appealing; however, caution is warranted due to the recent performance trends and the absence of insider buying, which could indicate a lack of confidence from those with inside knowledge of the company.
How Does HDB's Valuation Compare to Its History? Metric Current Historical P/E (TTM) 15.3x 20.4x Forward P/E 19.2x N/A HDB's current P/E (TTM) of 15.3x is 25% below its 5-year median P/E of 20.4x, indicating that the stock is trading below its historical valuation levels. This P/E analysis aligns with the GF Value™ verdict, supporting the notion that HDB is undervalued at its current price.
What Does HDB's GF Score™ Tell Us? Metric Rating GF Score™ 76/100 Financial Strength 3/10 Profitability 6/10 Growth 9/10 Valuation 8/10 Momentum 2/10 The GF Score™ provides valuable insights into HDB's overall performance. With a score of 76/100, the bank exhibits strong growth potential (9/10), indicating promising future earnings and revenue increases. However, the financial strength score of 3/10 is a significant weakness, suggesting potential concerns regarding the bank's stability. The valuation score of 8/10 further supports the undervaluation perspective, while the momentum score of 2/10 highlights ongoing challenges in maintaining positive price movement.
What Are Insiders Doing with HDB Stock? In the past three months, insider activity for HDB has shown a net sale of $0.3 million, with no reported purchases. This trend could suggest a lack of confidence from insiders in the company's immediate future performance. Typically, insider buying is viewed as a positive signal, indicating that those with the most knowledge about the company believe in its potential. Conversely, the recent selling could raise concerns for potential investors.
What This Means for Investors Based on the current analysis, HDFC Bank Ltd HDB is considered undervalued at its current price of $24.20 compared to its GF Value™ of $31.56. While this presents an opportunity for value-seeking investors, the recent insider selling and low financial strength score suggest that potential risks should be carefully considered before making investment decisions.
For the complete analysis, visit the HDFC Bank Ltd HDB stock page. You can also explore the GF Value™ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.
Frequently Asked Questions What is HDB's GF Score™?
HDB has a GF Score™ of 76/100, indicating that it is above average compared to other stocks, suggesting a potential for higher long-term returns.
Is HDB overvalued or undervalued?
HDB is currently undervalued, with a GF Value™ estimate of $31.56 compared to its market price of $24.20, indicating a 23.3% upside.
What is HDB's P/E ratio?
HDB's P/E (TTM) is 15.3x, which is significantly lower than its 5-year median P/E of 20.4x, suggesting that the stock is trading below its historical valuation levels.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
Investors interested in stocks from the Banks - Foreign sector have probably already heard of Erste Group Bank AG (EBKDY - Free Report) and HDFC Bank (HDB - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Erste Group Bank AG has a Zacks Rank of #2 (Buy), while HDFC Bank has a Zacks Rank of #4 (Sell) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that EBKDY has an improving earnings outlook. But this is just one piece of the puzzle for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
EBKDY currently has a forward P/E ratio of 9.73, while HDB has a forward P/E of 14.58. We also note that EBKDY has a PEG ratio of 0.57. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. HDB currently has a PEG ratio of 1.15.
Another notable valuation metric for EBKDY is its P/B ratio of 1.13. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, HDB has a P/B of 1.84.
Based on these metrics and many more, EBKDY holds a Value grade of A, while HDB has a Value grade of C.
EBKDY sticks out from HDB in both our Zacks Rank and Style Scores models, so value investors will likely feel that EBKDY is the better option right now.
HDFC Bank shares declined on Wednesday after a newspaper report alleged that India’s biggest private lender made payments to a Maharashtra state department to secure large deposits, raising fresh questions over governance at the bank.
The stock fell as much as 2% and was trading 1.9% lower at 764.20 rupees as of 10:40am in Mumbai.
The benchmark BSE Sensex was little changed.
The Indian Express reported that HDFC Bank paid 450 million rupees to Maharashtra State Road Development Corporation and booked the transfers as marketing expenses.
HDFC Bank did not immediately respond to an emailed request for comment.
The allegations have put renewed attention on the bank’s internal controls, legal review and leadership transition process.
According to the Indian Express report, the alleged payments were made to attract large deposits from the state-run entity.
The report also alleged that Chief Executive Officer Sashidhar Jagdishan was aware of the dealings.
If confirmed, such payments could raise questions over whether a bank effectively offered additional benefits to secure deposits outside normal interest-rate terms.
Banks are expected to treat depositors consistently within the framework of applicable rules. Any suggestion that payments were routed through marketing expenses to win deposits could attract closer scrutiny from regulators and investors.
Legal review remains under wayThe latest report comes against an already sensitive governance backdrop for HDFC Bank.
Earlier media reports about alleged lapses had prompted the lender to engage legal firms to review certain practices.
Those firms had not found any material deviation from the bank’s practices so far, according to the supplied details, though the review remains ongoing and no final conclusion has been reached.
That leaves investors waiting for clarity on whether the review identifies any governance concerns, and whether the bank issues a detailed response to the latest allegations.
The stock has fallen 9.5% since the chairman’s resignation on March 19, adding to market sensitivity around governance and leadership issues.
The allegations also come as investors watch the next steps in Jagdishan’s reappointment process.
His three-year term is due to end in October, and the reappointment application has not yet been filed with the Reserve Bank of India.
Any regulatory concern arising from the media report or the legal review could become important for shareholders assessing the timing and outcome of that process.
For now, the key questions are whether HDFC Bank provides a detailed rebuttal or clarification, whether the legal review reaches a firm conclusion, and whether the RBI seeks additional information.
The near-term focus is likely to remain on the bank’s response, the outcome of the governance review and any regulatory reaction to the reported payments.
Until then, the shares may remain vulnerable to further headlines around governance and management continuity.
On June 02, 2026, we present a detailed DCF analysis for HDFC Bank Ltd HDB , a company currently facing significant price performance challenges, with a year-to-date decline of 35.4% and a one-year decline of 36.6%. The current price of HDB stands at $23.60.
DCF Earnings-based intrinsic value of $42.85 compared to current price of $23.60 (margin of safety: 34.1%) DCF Free Cash Flow (FCF)-based intrinsic value of $67.87, providing a second opinion on valuation GF Score™ of 74/100, indicating a reliable basis for the DCF inputs What Is HDB Worth? DCF Earnings-Based Model The DCF earnings-based model for HDFC Bank Ltd HDB utilizes a two-stage growth approach. In the first stage, we expect the company's earnings per share (EPS) to grow at a robust rate of 17.9% annually for the next 10 years. This growth is then discounted at a rate of 11%, which combines the risk-free rate and equity risk premium. In the second stage, we assume a terminal growth rate of 4% for the following 10 years, also discounted at 11%.
Parameter Value Current EPS (TTM, excl. non-recurring) $1.58 10-Year Growth Rate 17.9% 10-Year Treasury Rate 4.43% Discount Rate (ceil(Treasury) + 6%) 11% Terminal Growth Rate 4% Below is a summary of the calculation for the intrinsic value based on the two-stage DCF model:
Stage Description Value Growth Stage (Years 1-10) EPS growing at 17.9%, discounted at 11% $22.33 Terminal Stage (Years 11-20) 4% terminal growth, discounted at 11% $20.52 Intrinsic Value Growth + Terminal $42.85 Comparing the current price of $23.60 against the intrinsic value of $35.82 suggests that HDB is significantly undervalued, with a margin of safety of 34.1%. It is important to note that GuruFocus uses EPS excluding non-recurring items because research indicates that stock prices correlate more closely with earnings than with free cash flow. For further calculations, visit the HDB DCF Calculator.
What Does the Free Cash Flow DCF Say? The Free Cash Flow (FCF)-based intrinsic value for HDFC Bank Ltd HDB is calculated at $67.87. This figure provides a contrasting perspective to the earnings-based model. Both models indicate that HDB is significantly undervalued, with the FCF model reflecting a margin of safety of 65.2%. This alignment between the two valuation methods reinforces the reliability of the intrinsic value estimates.
How Does GF Value™ Compare to the DCF Models? The GF Value™ for HDFC Bank Ltd HDB is calculated at $31.47, offering a third perspective on valuation. GF Value™ is GuruFocus' proprietary measure, derived from historical trading multiples, past business growth, and future performance estimates. All three models—DCF earnings, DCF FCF, and GF Value™—suggest that HDB is undervalued, providing a consistent view of the company's current market position. For more insights, visit the GF Value™ page.
What Does HDB's GF Score™ Tell Us? The GF Score™ ranks stocks on a scale from 0 to 100 based on five key aspects: Financial Strength, Profitability, Growth, Valuation, and Momentum. Stocks with higher GF Score™ values have historically generated higher long-term returns (backtested from 2006 to 2021). Below is a summary of HDB's GF Score™ metrics:
Metric Rating GF Score™ 74/100 Financial Strength 3/10 Profitability 6/10 Growth 9/10 Valuation 8/10 Momentum 2/10 The predictability rank for HDB is 2/5 stars, indicating that the DCF model may be less reliable for this stock due to its lower predictability. For more information, visit the HDB stock page.
Key Assumptions and Limitations It is essential to recognize that DCF models are highly sensitive to the assumptions made regarding growth rates and discount rates. Stocks with low predictability ratings, such as HDB, tend to produce less reliable DCF estimates. The terminal growth rate of 4% is a simplifying assumption that may not fully capture future economic conditions.
What This Means for Investors In summary, the DCF earnings model suggests an intrinsic value of $42.85, while the FCF model indicates $67.87. The GF Value™ further supports the notion of undervaluation at $31.47. Collectively, these models indicate that HDFC Bank Ltd HDB is significantly undervalued in the current market environment.
For the full DCF analysis, visit the HDB DCF Calculator. You can also explore the GF Value™ page, or use the GuruFocus Stock Screener to find undervalued predictable companies.
Frequently Asked Questions What is HDB's intrinsic value based on DCF?
HDB's intrinsic value based on the DCF earnings model is $35.82, while the FCF-based intrinsic value is $67.87.
Is HDB overvalued or undervalued?
Based on the DCF earnings, DCF FCF, and GF Value™ consensus, HDB is considered significantly undervalued.
How reliable is the DCF model for HDB?
The reliability of the DCF model for HDB is moderate, as indicated by its predictability rank of 2/5 stars.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
Shares of Indian banks rose more than 1% on Tuesday, making them the top-performing sectoral gainers after the Reserve Bank of India issued detailed guidelines for a concessional foreign exchange swap facility that lenders can use for overseas borrowings.
The move forms part of a broader package of measures announced by the central bank to attract foreign capital into the country at a time when India's economy is facing growth and inflation challenges.
The measures also come as the rupee remains under pressure from rising crude oil prices and sustained outflows from domestic equity markets.
The Nifty Bank index advanced 1.2% at 10:18 am IST in Mumbai, outperforming the broader market.
The benchmark Nifty 50 index was up 0.2% during the same period.
Among major lenders, State Bank of India and HDFC Bank gained 0.7% and 0.1%, respectively.
ICICI Bank rose 1.4%, emerging as the top performer among private sector lenders and helping the private banks index gain 1.1%.
The rally followed a mixed performance for banking stocks in recent sessions.
The banking index had risen 0.4% on Friday before declining 0.8% on Monday.
Under the RBI's framework, the concessional swap facility will remain available through September 30.
The facility is intended to compensate banks for hedging costs associated with three- to five-year foreign currency non-resident deposits.
Market participants appeared to welcome the additional clarity provided by the central bank.
Citi Research said, "This is likely to be treated as an additional announcement by the markets as there was no full clarity on this last Friday."
The brokerage added that the measure could generate overseas borrowings worth between $25 billion and $30 billion.
Jefferies projected even larger capital inflows.
According to the brokerage, overall inflows could reach $50 billion to $70 billion following the RBI's decision to allow banks to offer leverage on deposits made by non-residents.
According to ICICI Securities, the latest measures could strengthen banks' liability profiles by increasing the share of stable medium-term foreign currency deposits while reducing dependence on domestic deposit mobilisation.
The move comes at a time when lenders have been facing intense competition for deposits.
Households have increasingly been directing savings toward equities and other asset classes, creating challenges for banks seeking to raise funds through traditional deposits.
Despite Tuesday's gains, banking stocks have faced pressure this year.
The bank index has declined 8.2% so far, while the benchmark Nifty has fallen 11.4%.
Alongside the forex swap facility, the RBI announced several measures aimed at encouraging foreign investment and improving access to overseas capital.
Among the key initiatives, all new issuances of 15-year, 30-year, and 40-year government bonds will be included under the Fully Accessible Route.
According to the RBI, bonds in this category are already part of three global bond indexes.
The central bank said the move is expected to improve accessibility for foreign investors and could increase participation in India's government debt market.
In another significant policy change, limits relating to short-term investments, concentration norms, and individual securities applicable to foreign investment under the general route will be removed.
RBI Governor Sanjay Malhotra said the latest measures, along with tax benefits announced by the government earlier in the day, are expected to support greater foreign participation in government borrowing programmes.
The combined measures underscore the central bank's efforts to attract higher dollar inflows, support financial markets, and strengthen funding avenues for both the government and the banking sector.
Investors looking for stocks in the Banks - Foreign sector might want to consider either Erste Group Bank AG (EBKDY) or HDFC Bank (HDB). But which of these two stocks presents investors with the better value opportunity right now?
Royal Bank of Canada (TSE:RY – Get Free Report) (NYSE:RY) insider Katherine Gibson sold 462 shares of the business’s stock in a transaction on Wednesday, April 22nd. The stock was sold at an average price of C$242.82, for a total value of C$112,182.84. Following the completion of the sale, the insider directly owned 290 shares in the company, valued at C$70,417.80. This represents a 61.44% decrease in their position.
Royal Bank of Canada Stock Performance RY opened at C$239.83 on Monday. Royal Bank of Canada has a one year low of C$161.82 and a one year high of C$246.72. The stock’s fifty day moving average is C$230.17 and its 200-day moving average is C$224.54. The company has a market capitalization of C$333.49 billion, a PE ratio of 16.47, a P/E/G ratio of 3.42 and a beta of 1.07.
Royal Bank of Canada (TSE:RY – Get Free Report) (NYSE:RY) last posted its quarterly earnings data on Thursday, February 26th. The financial services provider reported C$4.08 EPS for the quarter. Royal Bank of Canada had a return on equity of 15.37% and a net margin of 20.88%.The company had revenue of C$17.96 billion for the quarter. On average, equities research analysts forecast that Royal Bank of Canada will post 12.3454675 EPS for the current fiscal year.
Royal Bank of Canada Dividend Announcement The company also recently disclosed a quarterly dividend, which will be paid on Friday, May 22nd. Stockholders of record on Friday, May 22nd will be paid a $1.64 dividend. This represents a $6.56 dividend on an annualized basis and a dividend yield of 2.7%. The ex-dividend date of this dividend is Thursday, April 23rd. Royal Bank of Canada’s payout ratio is currently 42.58%.
Royal Bank of Canada News Summary Here are the key news stories impacting Royal Bank of Canada this week:
Positive Sentiment: Recent fundamentals remain supportive: RBC reported strong Q4 results (C$4.08 EPS, C$17.96B revenue) and retains solid profitability metrics, which underpins longer‑term investor confidence. MarketBeat – Royal Bank of Canada profile Neutral Sentiment: Technicals/flow: the share price is near its 1‑year high and trading above both the 50‑ and 200‑day moving averages with volume above average — this can amplify moves but does not on its own change fundamentals. MarketBeat – Royal Bank of Canada profile Negative Sentiment: Director David Ian Mckay sold 23,089 shares at C$242.82 (~C$5.61M), reducing his holding by ~79.7% — a large director sale that may be viewed negatively by the market. Insider sale report Negative Sentiment: Insider Bruce Washington Ross sold 3,657 shares at C$242.82 (~C$888k), cutting his stake by ~93.96% — another sizable reduction. Insider sale report Negative Sentiment: Insiders Graeme Ashley Hepworth, Katherine Gibson and Jennifer Publicover also sold shares on April 22 (totaling ~1,463; 462; and 439 shares respectively), adding to the pattern of insider selling. Insider sale report Analyst Ratings Changes A number of analysts have recently commented on RY shares. Scotiabank boosted their price objective on Royal Bank of Canada from C$242.00 to C$247.00 and gave the stock an “outperform” rating in a research note on Friday, February 27th. Canadian Imperial Bank of Commerce boosted their price objective on Royal Bank of Canada from C$229.00 to C$242.00 and gave the stock a “neutral” rating in a research note on Friday, February 13th. Jefferies Financial Group boosted their price objective on Royal Bank of Canada from C$217.00 to C$220.00 in a research note on Wednesday, February 11th. National Bank Financial lifted their target price on Royal Bank of Canada from C$241.00 to C$247.00 and gave the stock an “outperform” rating in a report on Friday, February 27th. Finally, Raymond James Financial lifted their target price on Royal Bank of Canada from C$255.00 to C$260.00 and gave the stock a “buy” rating in a report on Friday, February 27th. One equities research analyst has rated the stock with a Strong Buy rating, eight have issued a Buy rating and two have assigned a Hold rating to the company’s stock. According to MarketBeat, Royal Bank of Canada has an average rating of “Moderate Buy” and a consensus price target of C$244.58.
Check Out Our Latest Stock Analysis on RY
Royal Bank of Canada Company Profile (Get Free Report)
Royal Bank of Canada is a global financial institution with a purpose-driven, principles-led approach to delivering leading performance. Our success comes from the 101,000+ employees who leverage their imaginations and insights to bring our vision, values and strategy to life so we can help our clients thrive and communities prosper. As Canada’s biggest bank and one of the largest in the world, based on market capitalization, we have a diversified business model with a focus on innovation and providing exceptional experiences to our more than 19 million clients in Canada, the U.S.
Further Reading Five stocks we like better than Royal Bank of Canada
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Book with page about preferred stock. Trading concept.
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Preferred stocks are a little-known dividend secret. Worth knowing, by the way—they can yield up to 9.9%!
These “forgotten cousins” of common stocks can make a dividend portfolio. Plus, the discounts! Today we can buy a basket with some ingredients fetching as little as 89 cents on the dollar.
A quick refresher on preferreds. When a company needs capital, it typically either sells common stock—the AAPL to our Apple, the JPM to our JPMorgan—or bonds. But there is a third option, and plenty of companies use it: preferred stock.
Like common stock, preferreds give you a sliver of ownership in a company, they can improve in price based on the company’s performance, and they pay dividends. Unlike common stock, preferreds typically don’t enjoy voting rights, the dividend is usually fixed, and it trades around a par value. In fact, these are all bond-like traits, which is why preferreds are often referred to as “hybrids.”
But what really makes preferreds stand out is just how big those dividends are. A company’s preferreds will routinely pay in the mid- to high single digits, which will typically be 2x to 3x what they’re paying on their common shares.
Just look at what a basic preferred exchange-traded fund (ETF) pays compared to the broader market.
Preferred ETF Yields
Contrarian Outlook
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Funds in general are a great way to own preferreds for numerous reasons, not the least of which is that they often pay us monthly. But plain-vanilla ETFs have their limitations. They gobble up preferreds with almost no regard to quality or value, which is why we can often do better with human managers at the helm.
We could get that actively managed coverage through mutual funds, but closed-end funds (CEFs) are the superior play. Here’s why:
CEFs’ prices frequently disconnect with the value of their assets, sometimes allowing us to buy a fund for much less than it’s actually worth.CEFs can take on debt to plow additional assets into their highest-conviction picks, which can supercharge performance and the yields they pay.CEFs can use options strategies such as selling covered calls to generate even more income than the portfolio would produce on its own.The result? Yields that blow ETFs and mutual funds out of the water—and translate into a massive yearly salary of $43,000 if we put a $500,000 nest egg into the trio of CEFs I’m about to highlight.
Preferred CEF Yields
Contrarian Outlook
And unlike preferred ETFs, we can buy these 7.6%- to 9.9%- yielding closed-end funds for discounts of between 4% and 11%.
Preferred Stock CEF #1: John Hancock Premium Dividend Fund (PDT)A great example of the difference the CEF structure makes is the John Hancock Premium Dividend Fund (PDT). Its 7%-plus yield would make it one of the top payers in ETF land, but it’s actually one of the lowest-yielding preferred closed-end funds … because management is playing with a little bit of a handicap.
PDT is a hybrid fund, investing roughly 50% of its assets in preferreds, and the other 50% in plain old common dividend stocks.
The preferred sleeve of the portfolio can hold its own. Its top holdings include preferreds from the likes of Citizens Financial (CFG), Wells Fargo (WFC), and Citigroup (C) that mostly pay in the 6%-7.5% range. The common sleeve? Sure, it includes Verizon (VZ) and a couple of other formidable dividend payers, but most of these companies are throwing off sub-4% distributions.
How does PDT bridge the funding gap? By throwing a lot of extra capital at management’s picks—the fund’s debt leverage currently stands at a thick 34%.
Over the very long term, this willingness to bet big has made itself apparent in two ways:
Much more volatility than a basic portfolio of preferreds.Returns that not only blow vanilla preferred ETFs out of the water, but are also mighty competitive with even 100% dividend-equity funds.Despite its run of late, John Hancock Premium Dividend Fund is trading at a wide 11% discount to its net asset value (NAV), meaning we’re effectively buying its preferreds for 89 cents on the dollar. That’s not just cheap on its face—it’s a relative bargain for this monthly payer, too. PDT has, on average, traded almost in line with its NAV over the past five years.
Preferred Stock CEF #2: Cohen & Steers Tax-Advantaged Preferred Securities and Income Fund (PTA)Most of us have been trained to see “tax-advantaged” and think “municipal bonds.”
As much as I’d like to give Uncle Sam the slip on my preferred payouts, that’s not quite what the Cohen & Steers Tax-Advantaged Preferred Securities and Income Fund (PTA) has to offer. Instead, PTA aims to minimize federal income tax consequences on its dividends by owning preferred stocks that pay qualified dividends—which are taxed at the more favorable long-term capital gains rates—and by adopting more of a buy-and-hold mentality so as not to trigger short-term capital gains. (And when it does pick up short-term capital gains, it’s mindful about offsetting those gains with short-term losses.)
Management isn’t exactly breaking its back to do this. Most preferred stocks pay qualified dividends. And preferreds aren’t exactly day trading fodder, either.
This is a global portfolio of about 300 preferreds, split roughly 50/50 between the U.S. and the rest of the world, mostly developed Europe. Financials, like BNP Paribas (BNPQY) and Royal Bank of Canada (RY), are dominant at almost 75% of assets, which is par for the preferred course. Credit quality is fine if not a little low; about 55% of assets are allocated to investment-grade preferred stocks. Leverage is even higher than PDT, at 35%, helping juice the payout above 8%.
PTA has only been around since 2020 and didn’t exactly charge out of the gate. But a lot of that had to do with timing—many preferred funds took it on the chin through the rate hikes of 2022 and 2023.
Cohen & Steers’ fund is trading at a 7% discount that looks decent in a bubble. However, its five-year average discount is only a hair lower, so it’s technically less expensive than normal, but it’s not a screaming deal.
We can’t get too attached, though. Like with some other CEFs, PTA is a “term” fund that’s scheduled to liquidate on Oct. 27, 2032, though the fund’s board of trustees technically could vote to extend its life by up to two years.
Preferred Stock CEF #3: Nuveen Variable Rate Pref & Inc Fund (NPFD)The Nuveen Variable Rate Preferred & Income Fund (NPFD), which came to life in 2021, has a similar story. It started trading not long before the Fed’s tightening pounded preferreds, so it looked awful from the start—but it has been in a relative sprint ever since bottoming out in 2023.
Preferred stocks usually pay a fixed dividend, but as this Nuveen fund’s name implies, NPFD is interested in variable-rate preferreds. Sort of.
Most of NPFD’s assets (about 85% right now) are invested in “fixed-to-fixed rate securities,” which step from one rate to another based on a set schedule, not underlying interest rates. Another 9% is dedicated to fixed-to-floating rate securities, which start with a fixed coupon that it pays for a few years before switching to a variable-rate coupon. It even holds a few fixed-rate securities. In all, only about 5% of assets are invested in truly variable-rate preferreds.
The rest of the portfolio details are pretty standard. This is another global preferred fund, at a roughly 60/40 U.S./international blend. About 75% of assets are in investment-grade preferred, so credit quality is good. And the 185-stock portfolio is amplified with 26% debt leverage.
Income investors would be hard-pressed to find a better preferred yield than what NPFD offers—at last check, it was the highest-yielding preferred fund on the market.
A discount to NAV of 4% is modest in the first place, but it’s actually more expensive than its long-term average discounts of almost 9%. So we’re not getting a screaming bargain here—but nearly 10% a month, paid monthly, papers over a lot of sins.
Brett Owens is Chief Investment Strategist for Contrarian Outlook. For more great income ideas, get your free copy his latest special report: How to Live off Huge Monthly Dividends (up to 8.2%) — Practically Forever.
NEW YORK, NY / ACCESS Newswire / May 8, 2026 / Aegis Capital Corp. - Aegis Capital Corp. (www.aegiscapcorp.com) a full-service wealth management, financial services and investment banking firm is pleased to announce the addition of the Atlanta, Georgia Location led by Leslie Netter.
Leslie is an experienced wealth management adviser with over 28 years of experience as a financial professional. Prior to becoming a financial adviser, Les was employed as a Certified Public Accountant for over 23 years with various Fortune 500 companies and a ‘Big 8' CPA firm. In 1998 he started in the financial sector with Citigroup until 2006 when he moved on to Morgan Stanley as Vice President and Financial Advisor. In 2015 Les then became a First Vice President--Wealth Management at UBS Financial for the next 10 years. Prior to joining Aegis Les had returned to Morgan Stanley.
Robert Eide Aegis' CEO commented: "Les' unwavering commitment to his clients is impressive and we are confident he will continue to grow and thrive with the support of Aegis' advanced capabilities, stability and cutting-edge technology. Aegis continues to offer a compelling alternative for wirehouse advisers."
Michael Pata Aegis' Head of Business Development commented: "Les is a well-respected adviser who goes above and beyond to meet the personalized financial goals of his clients. In addition to his arrival, we are also excited to expand our presence with the opening of the Atlanta office. The Atlanta metropolitan area's economy is the tenth largest in the country."
About Aegis Capital Corporation
Aegis Capital Corporation "Aegis" has been in business for over 40 years catering to the needs of private clients, institutions and corporations. Aegis was founded in 1984 and offers its investment representatives a conflict free service platform and is able to provide a full range of products and services including investment banking, wealth management, insurance, retirement planning, structured products, private equity, alternatives, equity research, fixed income and special purpose vehicles. Aegis is able to provide quality service through its primary clearing relationship with RBC Clearing & Custody whose parent company, Royal Bank of Canada (NYSE:RY), is one of the world's leading diversified financial services companies. Member: FINRA/SIPC.
Any questions contact:
Michael Pata, Head of Business Development
Telephone: 1-212-813-1010
[email protected]
www.aegiscapcorp.com
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. But 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.
Royal Bank (RY - Free Report) is headquartered in Toronto, and is in the Finance sector. The stock has seen a price change of 6.37% since the start of the year. Currently paying a dividend of $1.18 per share, the company has a dividend yield of 2.6%. In comparison, the Banks - Foreign industry's yield is 2.76%, while the S&P 500's yield is 1.43%.
Looking at dividend growth, the company's current annualized dividend of $4.72 is up 9.9% from last year. Over the last 5 years, Royal Bank has increased its dividend 5 times on a year-over-year basis for an average annual increase of 5.79%. 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. Royal Bank's current payout ratio is 45%, meaning it paid out 45% of its trailing 12-month EPS as dividend.
Earnings growth looks solid for RY for this fiscal year. The Zacks Consensus Estimate for 2026 is $11.57 per share, representing a year-over-year earnings growth rate of 12.33%.
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. But, not every company offers a quarterly payout.
High-growth firms or tech start-ups, for example, rarely provide their shareholders a dividend, while larger, more established companies that have more secure profits are often seen as the best dividend options. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, RY 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).
Royal Bank (RY - Free Report) is expected to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended April 2026. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.
The earnings report, which is expected to be released on May 28, might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower.
While management's discussion of business conditions on the earnings call will mostly determine the sustainability of the immediate price change and future earnings expectations, it's worth having a handicapping insight into the odds of a positive EPS surprise.
Zacks Consensus EstimateThis bank is expected to post quarterly earnings of $2.81 per share in its upcoming report, which represents a year-over-year change of +27.7%.
Revenues are expected to be $12.5 billion, up 13.4% from the year-ago quarter.
Estimate Revisions TrendThe consensus EPS estimate for the quarter has been revised 0.23% higher over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period.
Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts.
Price, Consensus and EPS Surprise
Earnings WhisperEstimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. Our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction) -- has this insight at its core.
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. 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.
Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only.
A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP.
Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell).
How Have the Numbers Shaped Up for Royal Bank?For Royal Bank, the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -1.07%.
On the other hand, the stock currently carries a Zacks Rank of #3.
So, this combination makes it difficult to conclusively predict that Royal Bank will beat the consensus EPS estimate.
Does Earnings Surprise History Hold Any Clue?While calculating estimates for a company's future earnings, analysts often consider to what extent it has been able to match past consensus estimates. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number.
For the last reported quarter, it was expected that Royal Bank would post earnings of $2.81 per share when it actually produced earnings of $2.94, delivering a surprise of +4.63%.
Over the last four quarters, the company has beaten consensus EPS estimates three times.
Bottom LineAn earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss.
That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
Royal Bank doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
Getting big returns from financial portfolios, whether through stocks, bonds, ETFs, other securities, or a combination of all, is an investor's dream. But 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.
Based in Toronto, Royal Bank (RY - Free Report) is in the Finance sector, and so far this year, shares have seen a price change of 11.27%. The bank is currently shelling out a dividend of $1.18 per share, with a dividend yield of 2.49%. This compares to the Banks - Foreign industry's yield of 2.8% and the S&P 500's yield of 1.42%.
Looking at dividend growth, the company's current annualized dividend of $4.72 is up 9.9% from last year. Over the last 5 years, Royal Bank has increased its dividend 5 times on a year-over-year basis for an average annual increase of 5.79%. 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. Royal Bank's current payout ratio is 45%, meaning it paid out 45% of its trailing 12-month EPS as dividend.
RY is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2026 is $11.53 per share, with earnings expected to increase 11.94% from the year ago period.
Investors like dividends for a variety of different reasons, from tax advantages and decreasing overall portfolio risk to considerably improving stock investing profits. However, not all companies offer 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. Income investors have to be mindful of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, RY 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).
All amounts are in Canadian dollars and are based on financial statements presented in compliance with International Accounting Standard 34 Interim Financial Reporting, unless otherwise noted. Our Q2 2026 Report to Shareholders is available at rbc.com/investorrelations, sedarplus.com and sec.gov and our Q2 2026 Supplementary Financial Information is available at rbc.com/investorrelations.
Net income
$5.5 billion
Up 25% YoY
Down 5% QoQ
Diluted EPS1
$3.85
Up 27% YoY
Down 4% QoQ
ROE1
17.2%
Up 300 bps1 YoY
Down 40 bps QoQ
Total PCL1
$0.9 billion
PCL on loans ratio1
down 6 bps QoQ
CET1 ratio1
13.5%
Above regulatory
requirements and
down 20 bps QoQ
Adjusted net
income2
$5.6 billion
Up 23% YoY
Down 5% QoQ
Adjusted diluted
EPS2
$3.90
Up 25% YoY
Down 4% QoQ
Adjusted ROE2
17.4%
Up 270 bps YoY
Down 40 bps QoQ
Total ACL1
$7.8 billion
ACL on loans ratio1
down 1 bp QoQ
LCR1
126%
Up from
124% last quarter
, /CNW/ - Royal Bank of Canada3 (TSX: RY) (NYSE: RY) today reported net income of $5.5 billion for the quarter ended April 30, 2026, up $1,119 million or 25% from the prior year. Diluted EPS was $3.85, up 27% over the same period, reflecting growth across each of our business segments. Adjusted net income2 and adjusted diluted EPS2 of $5.6 billion and $3.90 were up 23% and 25%, respectively, from the prior year.
"In a world that's constantly changing and becoming more complex, our commitment to delivering trusted advice and helping clients navigate risk continues to produce exceptional outcomes. Our second quarter earnings showcase our consistency in delivering premium profitability and long-term shareholder value, underpinned by solid growth across our diversified businesses and balance sheet strength. Looking ahead, we remain focused on building the bank of the future and evolving with the needs of those we serve."
– Dave McKay, President and Chief Executive Officer of Royal Bank of Canada
Pre-provision, pre-tax earnings2 of $8.0 billion were up $1.1 billion or 15% from last year, mainly due to higher revenue in Capital Markets, driven by strength across Global Markets and Corporate & Investment Banking, and higher fee-based revenue in Wealth Management, reflecting market appreciation and net sales. Higher net interest income in Personal Banking and Commercial Banking, reflecting average volume growth and higher spreads, also contributed to the increase. These factors were partially offset by higher compensation commensurate with increased results.
Our consolidated results reflect a decrease in total PCL of $512 million from a year ago, primarily due to lower provisions in Commercial Banking and Personal Banking. The PCL on loans ratio of 35 bps decreased 23 bps from the prior year. The PCL on impaired loans ratio1 of 34 bps decreased 1 bp, while the PCL on performing loans ratio1 of 1 bp decreased 22 bps, as the same quarter last year reflected higher provisions primarily due to the impacts of trade disruptions (including tariffs). Income before income taxes of $7.1 billion was up $1.6 billion or 29% from last year.
Compared to last quarter, net income was down 5% reflecting lower results in Wealth Management, Personal Banking and Commercial Banking, which includes the impact of three fewer days in the current quarter, and in Corporate Support, partly offset by higher results in Capital Markets and Insurance. Adjusted net income2 was down 5% over the same period. Pre-provision, pre-tax earnings2 were down $0.5 billion or 6% on lower revenues and flat expenses. The PCL on loans ratio of 35 bps decreased 6 bps from the prior quarter. The PCL on impaired loans ratio was 34 bps, down 6 bps from the prior quarter, primarily due to lower provisions in Capital Markets, and in Personal Banking and Commercial Banking to a lesser extent, while the PCL on performing loans ratio was 1 bp, remaining flat from the prior quarter.
Our capital position remains robust, with a CET1 ratio1 of 13.5%, supporting solid volume growth and $4.0 billion of capital returned to our shareholders, including $1.7 billion of share buybacks and $2.3 billion of common share dividends.
Today, we declared a quarterly dividend of $1.76 per share reflecting an increase of $0.12 or 7%. We also announced our intention, subject to the approval of the Toronto Stock Exchange and the Office of the Superintendent of Financial Institutions, to commence a normal course issuer bid and to repurchase for cancellation up to 45 million of our common shares, representing approximately 3% of the bank's outstanding common shares as at May 15, 2026.
____________________________________________
1 See the Glossary section of our interim Management's Discussion and Analysis dated May 27, 2026, available at sedarplus.com and sec.gov, for an explanation of the composition of these measures. Such explanation is incorporated by reference hereto.
2 These are non-GAAP measures or ratios. For further information, including a reconciliation, refer to the Key performance and non-GAAP measures section on pages 4 to 5 of this Earnings Release.
3 When we say "we", "us", "our", "the bank" or "RBC", we mean Royal Bank of Canada and its subsidiaries, as applicable.
Personal Banking
Net income of $1,870 million increased $268 million or 17% from a year ago, primarily driven by higher net interest income reflecting average volume growth of 2% and higher spreads, which included an unfavourable impact from lower accretion of fair value adjustments related to the acquisition of HSBC Bank Canada (HSBC Canada). Lower PCL, as the same quarter last year reflected higher provisions on performing loans primarily due to the impacts of trade disruptions (including tariffs), as well as higher fee-based client assets reflecting market appreciation and net sales also contributed to the increase.
Compared to last quarter, net income decreased $92 million or 5%, mainly driven by lower net interest income reflecting three fewer days in the current quarter.
Commercial Banking
Net income of $854 million increased $257 million or 43% from a year ago, primarily driven by lower PCL, as the same quarter last year reflected higher provisions on performing loans primarily due to the impacts of trade disruptions (including tariffs) and the current quarter reflected lower provisions on impaired loans. Higher net interest income reflecting average volume growth of 3% in both loans and deposits, and higher spreads also contributed to the increase.
Compared to last quarter, net income decreased $9 million or 1%, primarily driven by lower net interest income reflecting three fewer days in the current quarter. This was partially offset by lower PCL, largely due to lower provisions on impaired loans.
Wealth Management
Net income of $1,185 million increased $256 million or 28% from a year ago, mainly due to higher fee-based client assets reflecting market appreciation and net sales, which also drove higher variable compensation. Higher net interest income reflecting average volume growth in loans and deposits and higher spreads also contributed to the increase.
Compared to last quarter, net income decreased $110 million or 8%, mainly due to changes in the fair value of seed capital investments, seasonally lower performance fees, and higher PCL mainly reflecting provisions taken on performing loans as compared to releases of provisions last quarter, and higher provisions on impaired loans. These factors were partially offset by lower staff costs.
Insurance
Net income of $218 million increased $7 million or 3% from a year ago, primarily due to higher insurance investment result reflecting lower capital funding costs. This was partially offset by lower insurance service result, as the favourable impact of reinsurance contract recaptures was more than offset by the impact of claims experience.
Compared to last quarter, net income increased $5 million or 2%, primarily due to higher insurance investment result driven by favourable investment-related experience. This was partially offset by lower insurance service result, as the favourable impact of reinsurance contract recaptures was more than offset by the impact of claims experience.
Capital Markets
Net income of $1,484 million increased $282 million or 23% from a year ago, primarily driven by higher revenue in Global Markets and Corporate & Investment Banking. These factors were partially offset by higher taxes reflecting changes in earnings mix and higher compensation on increased results.
Compared to last quarter, net income remained relatively flat. Lower PCL, primarily reflecting lower provisions on impaired loans in a few sectors, including the consumer discretionary and financial services sectors, and higher equity and debt origination across all regions were offset by lower fixed income trading revenue across all regions.
Corporate Support
Net loss was $102 million for the current quarter, primarily due to legal provisions and residual unallocated costs.
Net loss was $26 million in the prior quarter, primarily due to residual unallocated costs, partially offset by asset/liability management activities.
Net loss was $151 million in the same quarter last year, primarily due to residual unallocated items, including severance.
Capital, Liquidity and Credit Quality
Capital
As at April 30, 2026, our CET1 ratio4 of 13.5% was down 20 bps from last quarter, as net internal capital generation was more than offset by share repurchases, business-driven RWA growth, the net impact of model updates and other items.
Liquidity
For the quarter ended April 30, 2026, the average LCR4 was 126%, which translates into a surplus of approximately $96 billion, compared to 124% and a surplus of approximately $91 billion in the prior quarter. Average LCR4 increased from the prior quarter, primarily due to changes in securities mix, partially offset by loan growth.
NSFR4 as at April 30, 2026 was 111%, which translates into a surplus of approximately $115 billion, compared to 111% and a surplus of approximately $113 billion in the prior quarter. NSFR4 remained flat compared to last quarter as growth in deposits and funding was offset by loan growth.
_________________________________________
4 See the Glossary section of our interim Management's Discussion and Analysis dated May 27, 2026, available at sedarplus.com and sec.gov, for an explanation of the composition of these measures. Such explanation is incorporated by reference hereto.
Credit Quality
Q2 2026 vs. Q2 2025
Total PCL of $912 million decreased $512 million or 36% from a year ago, primarily due to lower provisions in Commercial Banking and Personal Banking. The PCL on loans ratio of 35 bps decreased 23 bps. The PCL on impaired loans ratio of 34 bps decreased 1 bp.
PCL on performing loans of $18 million decreased $550 million, as the same quarter last year reflected higher provisions primarily due to the impacts of trade disruptions (including tariffs).
PCL on impaired loans of $899 million increased $47 million or 6%, primarily due to higher provisions in Personal Banking, partially offset by lower provisions in Commercial Banking.
Q2 2026 vs. Q1 2026
Total PCL decreased $178 million or 16% from last quarter, primarily due to lower provisions in Capital Markets, Personal Banking and Commercial Banking, partially offset by higher provisions in Wealth Management. The PCL on loans ratio decreased 6 bps. The PCL on impaired loans ratio decreased 6 bps.
PCL on performing loans decreased $10 million or 36%, primarily due to changes in credit quality, partially offset by unfavourable changes to our macroeconomic forecast.
PCL on impaired loans decreased $169 million or 16%, primarily due to lower provisions in Capital Markets, Personal Banking and Commercial Banking.
Key performance and non-GAAP measures
Performance measures
We measure and evaluate the performance of our consolidated operations and each business segment using a number of financial metrics, such as net income and ROE. Certain financial metrics, including ROE, do not have a standardized meaning under generally accepted accounting principles (GAAP) and may not be comparable to similar measures disclosed by other financial institutions.
Non-GAAP measures
Non-GAAP measures and ratios do not have a standardized meaning under GAAP and may not be comparable to similar measures disclosed by other financial institutions.
The following discussion describes the non-GAAP measures and ratios we use in evaluating our operating results.
Pre-provision, pre-tax earnings
We use pre-provision, pre-tax earnings (PPPT) to assess our ability to generate sustained earnings growth outside of credit losses, which are impacted by the cyclical nature of the credit cycle. PPPT may enhance comparability of our financial performance and enable readers to better assess trends in the underlying businesses. The following table provides a reconciliation of our reported results to PPPT and illustrates the calculation of PPPT presented:
For the three months ended
For the six months ended
April 30
January 31
April 30
April 30
April 30
(Millions of Canadian dollars)
2026
2026
2025
2026
2025
Net income
$
5,509
$
5,785
$
4,390
$
11,294
$
9,521
Add: Income taxes
1,595
1,622
1,128
3,217
2,430
Add: PCL
912
1,090
1,424
2,002
2,474
Pre-provision, pre-tax earnings
$
8,016
$
8,497
$
6,942
$
16,513
$
14,425
Adjusted results and ratios
We believe that adjusted results are more reflective of our ongoing operating results and provide readers with a better understanding of management's perspective on performance. Specified items discussed below can lead to variability that could obscure trends in underlying business performance and the amortization of acquisition-related intangibles can differ widely between organizations. Excluding the impact of specified items and amortization of acquisition-related intangibles may enhance comparability of our financial performance and enable readers to better assess trends in the underlying businesses.
Our results for the three and six months ended April 30, 2025 were adjusted for the following specified item:
HSBC Canada transaction and integration costs. Adjusted ratios, including adjusted EPS (basic and diluted), adjusted ROE and adjusted efficiency ratio, which are derived from adjusted results, are useful to readers because they may enhance comparability in assessing profitability on a per-share basis, how efficiently profits are generated from average common equity and how efficiently costs are managed relative to revenues. Adjusted results and ratios can also help inform and support strategic choices and capital allocation decisions.
Consolidated results, reported and adjusted
The following table provides a reconciliation of our reported results to our adjusted results and illustrates the calculation of adjusted measures presented. The adjusted results and ratios presented below are non-GAAP measures or ratios.
As at or for the three months ended
As at or for the six months ended
(Millions of Canadian dollars, except per share, number of and percentage amounts)
April 30
2026
January 31
2026
April 30
2025
April 30
2026
April 30
2025
Total revenue
$
17,453
$
17,960
$
15,672
$
35,413
$
32,411
PCL
912
1,090
1,424
2,002
2,474
Non-interest expense
9,437
9,463
8,730
18,900
17,986
Income before income taxes
7,104
7,407
5,518
14,511
11,951
Income taxes
1,595
1,622
1,128
3,217
2,430
Net income
$
5,509
$
5,785
$
4,390
$
11,294
$
9,521
Net income available to common shareholders
$
5,372
$
5,643
$
4,274
$
11,015
$
9,285
Average number of common shares (thousands)
1,393,332
1,398,580
1,411,362
1,396,000
1,412,671
Basic earnings per share (in dollars)
$
3.86
$
4.03
$
3.03
$
7.89
$
6.57
Average number of diluted common shares (thousands)
1,396,548
1,401,884
1,413,517
1,399,262
1,415,037
Diluted earnings per share (in dollars)
$
3.85
$
4.03
$
3.02
$
7.87
$
6.56
ROE
17.2 %
17.6 %
14.2 %
17.4 %
15.5 %
Effective income tax rate
22.5 %
21.9 %
20.4 %
22.2 %
20.3 %
Total adjusting items impacting net income (before-tax)
$
101
$
102
$
184
$
203
$
349
Specified item: HSBC Canada transaction and integration costs (1)
-
-
31
-
43
Amortization of acquisition-related intangibles (2)
101
102
153
203
306
Total income taxes for adjusting items impacting net income
$
27
$
26
$
46
$
53
$
88
Specified item: HSBC Canada transaction and integration costs (1)
-
-
7
-
13
Amortization of acquisition-related intangibles (2)
27
26
39
53
75
Adjusted results (3)
Income before income taxes - adjusted
$
7,205
$
7,509
$
5,702
$
14,714
$
12,300
Income taxes - adjusted
1,622
1,648
1,174
3,270
2,518
Net income - adjusted
5,583
5,861
4,528
11,444
9,782
Net income available to common shareholders - adjusted
5,446
5,719
4,412
11,165
9,546
Average number of common shares (thousands)
1,393,332
1,398,580
1,411,362
1,396,000
1,412,671
Basic earnings per share (in dollars) - adjusted (3)
$
3.91
$
4.09
$
3.13
$
8.00
$
6.76
Average number of diluted common shares (thousands)
1,396,548
1,401,884
1,413,517
1,399,262
1,415,037
Diluted earnings per share (in dollars) - adjusted (3)
$
3.90
$
4.08
$
3.12
$
7.98
$
6.75
ROE - adjusted (3)
17.4 %
17.8 %
14.7 %
17.6 %
15.9 %
Effective income tax rate - adjusted (3)
22.5 %
21.9 %
20.6 %
22.2 %
20.5 %
(1)
These amounts have been recognized in Corporate Support.
(2)
Represents the impact of amortization of acquisition-related intangibles (excluding amortization of software), and any goodwill impairment.
(3)
See the Glossary section of our interim Management's Discussion and Analysis dated May 27, 2026, available at sedarplus.com and sec.gov, for an explanation of the composition of these measures. Such explanation is incorporated by reference hereto.
Additional information about ROE and other key performance and non-GAAP measures and ratios can be found under the Key performance and non-GAAP measures section of our Q2 2026 Report to Shareholders.
Caution regarding forward-looking statements
From time to time, we make written or oral forward-looking statements within the meaning of certain securities laws, including the "safe harbour" provisions of the United States Private Securities Litigation Reform Act of 1995 and any applicable Canadian securities legislation. We may make forward-looking statements in this document, in other filings with Canadian regulators or the United States Securities and Exchange Commission, in reports to shareholders and in other communications. In addition, our representatives may communicate forward-looking statements orally to analysts, investors, the media and others. Forward-looking statements in this document include, but are not limited to, statements by our President and Chief Executive Officer. The forward-looking statements contained in this document represent the views of management and are presented for the purpose of assisting the holders of our securities and financial analysts in understanding our financial position and results of operations as at and for the periods ended on the dates presented, as well as our financial performance objectives, vision, strategic goals and priorities and anticipated financial performance, and may not be appropriate for other purposes. Forward-looking statements are typically identified by words such as "believe", "expect", "suggest", "seek", "foresee", "forecast", "schedule", "anticipate", "intend", "estimate", "goal", "commit", "target", "objective", "plan", "outlook", "timeline" and "project" and similar expressions of future or conditional verbs such as "will", "may", "might", "should", "could", "can", "would" or negative or grammatical variations thereof.
By their very nature, forward-looking statements require us to make assumptions and are subject to inherent risks and uncertainties, both general and specific in nature, which give rise to the possibility that our predictions, forecasts, projections, expectations or conclusions will not prove to be accurate, that our assumptions may not be correct, that our financial performance, environmental & social or other objectives, vision and strategic goals will not be achieved, and that our actual results may differ materially from such predictions, forecasts, projections, expectations or conclusions.
We caution readers not to place undue reliance on our forward-looking statements as a number of risk factors could cause our actual results to differ materially from the expectations expressed in such forward-looking statements. These factors – many of which are beyond our control and the effects of which can be difficult to predict – include, but are not limited to: business and economic conditions in the geographic regions in which we operate, Canadian housing and household indebtedness, information technology, cyber and third-party risks, geopolitical uncertainty (including risks associated with the conflict in the Middle East), environmental and social risk, digital disruption and innovation, privacy and data related risks, regulatory changes, culture and conduct risks, credit, market, liquidity and funding, insurance, operational, compliance, reputation and strategic risks, other risks discussed in the risk sections of our 2025 Annual Report and the Risk management section of our Q2 2026 Report to Shareholders, including legal and regulatory environment risk, the effects of changes in government fiscal, monetary and other policies and tax risk and transparency, risks associated with escalating trade tensions, including protectionist trade policies such as the imposition of tariffs, risks associated with the adoption of emerging technologies, such as cloud computing, artificial intelligence (AI), including generative AI, and robotics, fraud risk and our ability to anticipate and successfully manage risks arising from all of the foregoing factors. Additional factors that could cause actual results to differ materially from the expectations in such forward-looking statements can be found in the risk sections of our 2025 Annual Report and the Risk management section of our Q2 2026 Report to Shareholders, as may be updated by subsequent quarterly reports.
We caution that the foregoing list of risk factors is not exhaustive and other factors could also adversely affect our results. When relying on our forward-looking statements to make decisions with respect to us, investors and others should carefully consider the foregoing factors and other uncertainties and potential events, as well as the inherent uncertainty of forward-looking statements. Material economic assumptions underlying the forward-looking statements contained in this document are set out in the Economic, market and regulatory review and outlook section and for each business segment under the Strategic priorities and Outlook headings in our 2025 Annual Report, as updated by the Economic, market and regulatory review and outlook section of our Q2 2026 Report to Shareholders. Such sections may be updated by subsequent quarterly reports. Any forward-looking statements contained in this document represent the views of management only as of the date hereof, and except as required by law, we do not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by us or on our behalf.
Access to Quarterly Results Materials
Interested investors, the media and others may review this quarterly Earnings Release, quarterly results slides, supplementary financial information and our Q2 2026 Report to Shareholders at rbc.com/investorrelations.
Quarterly conference call and webcast presentation
Our quarterly conference call is scheduled for May 28, 2026 at 8:30 a.m. (EST) and will feature a presentation about our second quarter results by RBC® executives. It will be followed by a question and answer period with analysts. Interested parties can access the call live on a listen-only basis at rbc.com/investorrelations/quarterly-financial-statements.html or by telephone (647-557-5257 or 888-440-2170, passcode 5994534#). Please call between 8:20 a.m. and 8:25 a.m. (EST).
Management's comments on results will be posted on our website shortly following the call. A recording will be available by 5:00 p.m. (EST) from May 28, 2026 until August 26, 2026 at rbc.com/investorrelations/quarterly-financial-statements.html or by telephone (647-362-9199 or 800-770-2030, passcode 5994534#).
Investor Relations Contact
Asim Imran, Senior Vice President, Head of Investor Relations, [email protected], 416-955-7804
About RBC
Royal Bank of Canada is a global financial institution with a purpose-driven, principles-led approach to delivering leading performance. Our success comes from the 101,000+ employees who leverage their imaginations and insights to bring our vision, values and strategy to life so we can help our clients thrive and communities prosper. As Canada's biggest bank and one of the largest in the world, based on market capitalization, we have a diversified business model with a focus on innovation and providing exceptional experiences to our more than 19 million clients in Canada, the U.S. and 27 other countries. Learn more at rbc.com.
We are proud to support a broad range of community initiatives through donations, community investments and employee volunteer activities. See how at rbc.com/peopleandplanet.
Information contained in or otherwise accessible through the websites mentioned herein does not form part of this document. All references in this document to websites are inactive textual references and are for your information only.
, /CNW/ - Royal Bank of Canada (TSX: RY) (NYSE: RY) announced today that its board of directors has declared an increase to its quarterly common share dividend of 12 cents, or seven per cent, to $1.76 per share, payable on or after August 24, 2026, to common shareholders of record at the close of business on July 27, 2026.
The board also declared a dividend for the following Non-Cumulative First Preferred Shares, payable on or after August 24, 2026, to shareholders of record at the close of business on July 27, 2026.
Series BO Dividend No. 31 of $0.3678125 per share. The board also declared dividends for the following Non-Cumulative First Preferred Shares, payable on or after August 24, 2026, to shareholders of record at the close of business on August 17, 2026.
Series BT Dividend No. 10 of $21.00 per share. Series BU Dividend No. 5 of $37.04 per share. For further information, please contact:
, /CNW/ - Royal Bank of Canada (the Bank) (TSX: RY) (NYSE: RY) today announced its intention, subject to the approval of the Toronto Stock Exchange (TSX) and the Office of the Superintendent of Financial Institutions (OSFI), to commence a normal course issuer bid and to repurchase for cancellation up to 45 million of its common shares. The Bank intends to file a notice of intention with the TSX in this regard.
Purchases may commence on June 12, 2026, provided the TSX has accepted the notice of intention, and may continue until June 11, 2027, when the bid expires or such earlier date as the Bank may complete its purchases pursuant to the notice of intention. Purchases may be made through the TSX, the New York Stock Exchange and other designated exchanges and alternative Canadian trading systems. The price paid for any repurchased shares will be the prevailing market price at the time of acquisition. The timing and amount of any purchases under the program are subject to regulatory approvals and to management discretion based on factors such as market conditions and capital adequacy.
The shares that may be repurchased represent approximately 3.24 per cent of the Bank's outstanding common shares as at May 15, 2026. On May 15, 2026, there were 1,389,691,690 common shares outstanding.
The proposed normal course issuer bid will give the Bank flexibility to manage its capital position while generating shareholder value. On April 30, 2026, the Bank's Common Equity Tier 1, Tier 1 and Total capital ratios were 13.5 per cent, 15.0 per cent and 16.9 per cent, respectively.
Caution regarding forward-looking statements
This press release contains forward-looking statements within the meaning of certain securities laws, including the "safe harbour" provisions of the United States Private Securities Litigation Reform Act of 1995 and any applicable Canadian securities legislation, with respect to the Bank's beliefs, plans, expectations and estimates. Forward-looking statements in this press release may include, but are not limited to, statements with respect to the Bank's normal course issuer bid. Forward-looking statements are typically identified by words such as "believe", "expect", "suggest", "seek", "foresee", "forecast", "schedule", "anticipate", "intend", "estimate", "goal", "commit", "target", "objective", "plan", "outlook", "timeline" and "project" and similar expressions of future or conditional verbs such as "will", "may", "might", "should", "could", "can", "would" or negative or grammatical variations thereof.
By their very nature, forward-looking statements require us to make assumptions and are subject to inherent risks and uncertainties, both general and specific in nature, which give rise to the possibility that our predictions, forecasts, projections, expectations or conclusions will not prove to be accurate, that our assumptions may not be correct, that the strategic goals and financial performance and other objectives outlined in our forward-looking statements, including statements about the Bank's proposed normal course issuer bid, will not be achieved and that our actual results may differ materially from such predictions, forecasts, projections, expectations or conclusions.
We caution readers not to place undue reliance on our forward-looking statements as a number of risk factors could cause our actual results to differ materially from the expectations expressed in such forward-looking statements. These factors – many of which are beyond our control and the effects of which can be difficult to predict – include, but are not limited to: business and economic conditions in the geographic regions in which we
operate, Canadian housing and household indebtedness, information technology, cyber and third-party risks, geopolitical uncertainty (including risks associated with the conflict in the Middle East), environmental and social risk, digital disruption and innovation, privacy and data related risks, regulatory changes, culture and conduct risks, credit, market, liquidity and funding, insurance, operational, compliance, reputation and strategic risks, other risks discussed in the risk sections of our 2025 Annual Report and the Risk management section of our Q2 2026 Report to Shareholders, including legal and regulatory environment risk, the effects of changes in government fiscal, monetary and other policies and tax risk and transparency, risks associated with escalating trade tensions, including protectionist trade policies such as the imposition of tariffs, risks associated with the adoption of emerging technologies, such as cloud computing, artificial intelligence (AI), including generative AI, and robotics, fraud risk and our ability to anticipate and successfully manage risks arising from all of the foregoing factors. Additional factors that could cause actual results to differ materially from the expectations in such forward-looking statements can be found in the risk sections of our 2025 Annual Report and the Risk management section of our Q2 2026 Report to Shareholders, as may be updated by subsequent quarterly reports.
We caution that the foregoing list of risk factors is not exhaustive and other factors could also adversely affect our results. When relying on our forward-looking statements to make decisions with respect to us, investors and others should carefully consider the foregoing factors and other uncertainties and potential events, as well as the inherent uncertainty of forward-looking statements. Material economic assumptions underlying the forward-looking statements contained in this press release are set out in the Economic, market and regulatory review and outlook section and for each business segment under the Strategic priorities and Outlook headings in our
2025 Annual Report, as updated by the Economic, market and regulatory review and outlook section of our Q2 2026 Report to Shareholders. Such sections may be updated by subsequent quarterly reports.
Any forward-looking statements contained in this press release represent the views of the Bank only as of the date hereof, and except as required by law, the Bank does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by us or on our behalf.
Royal Bank (RY - Free Report) came out with quarterly earnings of $2.84 per share, beating the Zacks Consensus Estimate of $2.81 per share. This compares to earnings of $2.2 per share a year ago. These figures are adjusted for non-recurring items.
This quarterly report represents an earnings surprise of +1.07%. A quarter ago, it was expected that this bank would post earnings of $2.81 per share when it actually produced earnings of $2.94, delivering a surprise of +4.63%.
Over the last four quarters, the company has surpassed consensus EPS estimates four times.
Royal Bank, which belongs to the Zacks Banks - Foreign industry, posted revenues of $12.73 billion for the quarter ended April 2026, surpassing the Zacks Consensus Estimate by 1.80%. This compares to year-ago revenues of $11.03 billion. The company has topped consensus revenue estimates four times over the last four quarters.
The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.
Royal Bank shares have added about 10.9% since the beginning of the year versus the S&P 500's gain of 9.9%.
What's Next for Royal Bank?While Royal Bank has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?
There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Ahead of this earnings release, the estimate revisions trend for Royal Bank was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $2.88 on $12.8 billion in revenues for the coming quarter and $11.53 on $51.58 billion in revenues for the current fiscal year.
Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Banks - Foreign is currently in the top 42% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
Another stock from the same industry, Banco Comercial Portugues S.A. Unsponsored ADR (BPCGY - Free Report) , has yet to report results for the quarter ended March 2026.
This company is expected to post quarterly earnings of $0.22 per share in its upcoming report, which represents a year-over-year change of -66.7%. The consensus EPS estimate for the quarter has been revised 5% higher over the last 30 days to the current level.
Banco Comercial Portugues S.A. Unsponsored ADR's revenues are expected to be $1.13 billion, up 16.4% from the year-ago quarter.
NEW YORK, NY / ACCESS Newswire / May 28, 2026 / Aegis Capital Corp. (www.aegiscapcorp.com), a full-service wealth management, financial services and investment banking firm, is pleased to announce the hiring of Michael and Robert Taglich, as Managing Directors of our Private Equity Division
Michael and Robert Taglich, bringing more than 80 years of combined industry experience, together founded Taglich Brothers Inc. in 1991, where they participated in the financing and development of numerous public and private companies. They focused on mid-market companies and have developed an acute awareness of the needs and obstacles their companies face. They have a finger on the pulse of these companies and have helped them achieve their goals by providing them with the capital they need to build long-term shareholder value. Uniquely, they operated as a hybrid family office, a mid-market private equity shop, and a broker dealer, taking advantage of investment opportunities in the public and private markets and in many instances, they invest alongside their clients. Michael and Robert manage in excess of $300 million in assets under management.
Michael and Robert Taglich will focus on originating and managing private investment opportunities, advising emerging growth companies, and supporting capital formation initiatives across the lower middle-market sector. Their addition reflects Aegis' continued commitment to strategic growth and the expansion of the Private Banking Department.
Robert Eide Aegis' CEO commented: "We are honored to welcome Michael and Robert to the Aegis family. Their decision to shift away from operating a broker-dealer allows them to put 100 percent of their effort into what matters most, continuing to help companies and individuals maximize their returns. With access to Aegis' scale, resources, and technology, they are positioned well for continued growth."
Michael Pata Aegis' Head of Business Development commented: "We welcome Michael and Robert Taglich to Aegis. This partnership allows them to build on the strong platform we have created while giving them access to a deeper set of tools, technology, and services. Together with Aegis, they can accelerate their growth far faster than if they continued building on their own."
About Aegis Capital Corporation
Aegis Capital Corporation "Aegis" has been in business for over 40 years catering to the needs of private clients, institutions and corporations. Aegis was founded in 1984 and offers its investment representatives a conflict free service platform and is able to provide a full range of products and services including investment banking, wealth management, insurance, retirement planning, structured products, private equity, alternatives, equity research, fixed income and special purpose vehicles.Aegis is able to provide quality service through its primary clearing relationship with RBC Clearing & Custody whose parent company, Royal Bank of Canada (NYSE: RY), is one of the world's leading diversified financial services companies. Member: FINRA / SIPC.
Any questions contact:
Michael Pata, Head of Business Development
Telephone: 1-212-813-1010
[email protected]
www.aegiscapcorp.com
3 High-Risk Stocks That Soared in 2025 But Can Still Fly HigherRoyal Bank Of Canada NYSE: RY reported fiscal second-quarter earnings of CAD 5.5 billion, with adjusted earnings of CAD 5.6 billion, as management highlighted strong results across capital markets, wealth management and Canadian banking businesses.
President and Chief Executive Officer Dave McKay said the quarter represented RBC’s “second highest quarterly performance on record.” He said pre-provision, pre-tax earnings rose 15% from a year earlier, supported by 11% revenue growth and all-bank operating leverage of more than 3%. The bank reported a return on equity of 17.2% and a Common Equity Tier 1 ratio of 13.5%.
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Rayonier-PotlatchDeltic Merger Signals Industry Upside“These results were underpinned by the strength of our diversified business model,” McKay said, citing a constructive environment for market-related businesses and scale in Canadian Personal Banking and Commercial Banking.
Capital Markets and Wealth Management Drive Results RBC Capital Markets posted record net income, reflecting strength in both global markets and investment banking. McKay said global investment banking improved its last-12-month market share to more than 2%, with record fee-based revenue from merger and acquisition advisory activity, as well as debt and equity origination.
3 International Bank Stocks With Strong DividendsRBC cited several transactions during the quarter, including advising CPP Investments on its $4.2 billion acquisition of atNorth, acting as joint active bookrunner on Alphabet’s CAD 8.5 billion inaugural Maple senior unsecured notes offering, and serving as exclusive financial adviser to ARC Resources on a sale agreement with Shell valued at CAD 22 billion. In the U.S., RBC acted as joint lead bookrunner to Fervo Energy on its $2.2 billion IPO.
Katherine Gibson, RBC’s chief financial officer, said Capital Markets net income of CAD 1.5 billion increased 23% from a year earlier. Global markets revenue rose 16%, while corporate and investment banking revenue reached a record level, up 17% from last year. Investment banking revenue increased 27%.
Wealth Management net income rose 28% from a year earlier to CAD 1.2 billion. Gibson said the increase reflected higher fee-based client assets from market appreciation and net new asset growth. RBC Global Asset Management assets under management surpassed CAD 800 billion, while Canadian Wealth Management assets under administration exceeded CAD 1 trillion. McKay said the Canadian wealth business added CAD 10 billion in net new assets during the quarter, while U.S. Wealth Management added US $5 billion in net new assets.
Canadian Banking Shows Growth Despite Uncertainty Personal Banking reported earnings of CAD 1.9 billion, with Canadian Personal Banking net income up 18% from a year earlier. Gibson said revenue growth of 6% benefited from RBC’s scale and client balances shifting among core banking accounts, term deposits and investment offerings. Net interest income rose 6%, while non-interest income increased 5%, supported by double-digit growth in mutual fund revenue.
Commercial Banking net income rose 43% to CAD 854 million, compared with a prior-year period that included elevated provisions for credit losses. Pre-provision, pre-tax earnings increased 5%, driven by higher net interest income, higher volumes, favorable deposit mix and higher margins. Loans were up 3% year over year and 1% sequentially amid tariff-related uncertainty.
McKay said Commercial Banking growth remained resilient despite structural demand headwinds, particularly in Ontario. He pointed to tariff uncertainty in trade-exposed sectors and moderating demand in commercial real estate, especially condo development. Still, he said RBC had delivered 12 consecutive quarters of market share gains in lending balances as of the prior quarter.
During the question-and-answer session, Sean Amato-Gauci, group head of Commercial Banking, said pipelines were “really strong” and that the bank was seeing growth in sectors less affected by tariffs, including agriculture, public sector, services, healthcare and seniors housing.
Credit Outlook Remains Cautious Graeme Hepworth, chief risk officer, said North American economies remain resilient but face soft underlying conditions, geopolitical risks and trade uncertainty. He said RBC’s base case for Canadian GDP growth and unemployment was little changed from the prior quarter, but the bank added modest severity to downside macroeconomic scenarios and continued to apply elevated weightings to those downside cases.
RBC recorded CAD 18 million in provisions on performing loans during the quarter. Gross impaired loans rose by CAD 623 million from the prior quarter to CAD 9.8 billion, primarily driven by Capital Markets and Wealth Management. In Capital Markets, impaired loans increased across sectors including real estate, forest products and consumer discretionary. In Wealth Management, the increase was largely in City National Bank, including names in utilities, real estate and other services sectors, as well as consumer mortgages.
Provisions for credit losses on impaired loans totaled CAD 899 million, or 34 basis points, down CAD 169 million from the prior quarter. Hepworth said RBC continues to have a cautious credit outlook, even as internal credit indicators have generally been stable or improving.
“Despite heightened uncertainty, we remain confident in the overall quality, diversification, and resilience in our portfolios,” Hepworth said.
Capital Returns and AI Initiatives in Focus RBC increased its quarterly dividend by CAD 0.12 from the prior quarter, which McKay said represented a 14% year-over-year increase. The bank also repurchased 7.4 million shares for approximately CAD 1.7 billion during the quarter. RBC announced its intention, subject to approvals, to begin a normal course issuer bid to repurchase for cancellation up to 45 million common shares.
McKay said buybacks remain an important method of returning capital to shareholders, adding that RBC believes the intrinsic value of its shares remains above current valuations. Gibson said the bank intends to keep capital levels closer to the higher end of its targeted CET1 range given the uncertain environment, while continuing to return capital through dividends and buybacks.
Management also emphasized RBC’s artificial intelligence initiatives. McKay said the bank has developed more than 200 AI models and remains committed to generating CAD 700 million to CAD 1 billion in enterprise value from AI. He said AI has contributed to more than 24 million lines of code and more than 120,000 code reviews, while also being used in client service, advisor support and Commercial Banking workflows.
Asked by Bank of America analyst Ebrahim Poonawala about disruption risks from fintechs and AI, McKay said RBC is “fully capable” of building similar tools and argued that trust, brand, scale and regulatory strength remain important advantages for banks.
Management Maintains 2026 Outlook Gibson said RBC continues to expect annual all-bank net interest income growth, excluding trading, in the mid-single-digit range, including more than CAD 250 million of lower purchase price accounting benefits related to the HSBC Canada acquisition. The bank also maintained guidance for full-year all-bank expense growth in the mid-single-digit range.
McKay said the Canadian economy remains resilient, with annualized GDP growth tracking at 1.7% in the first quarter of 2026, though uncertainty remains tied to CUSMA negotiations and the conflict in the Middle East. He said he was optimistic about medium-term opportunities in energy, critical minerals, infrastructure and defense-related projects in Canada.
“The resilience in the short term, the meaningful opportunities in the long term,” McKay said during the Q&A, summarizing his view of the Canadian macro backdrop.
About Royal Bank Of Canada NYSE: RYRoyal Bank of Canada NYSE: RY is a diversified financial services company and one of Canada's largest banks. Founded in 1864 in Halifax, Nova Scotia, the firm is now headquartered in Toronto, Ontario. It provides a broad range of banking and financial services to individuals, businesses, and institutional clients through a network of branches, digital platforms and international offices.
RBC operates across several principal business segments including personal and commercial banking, wealth management, insurance, investor and treasury services, capital markets, and global asset management.
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 Royal Bank Of Canada Right Now?Before you consider Royal Bank Of Canada, you'll want to hear this.
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Royal Bank of Canada's second quarter numbers were impressive, with 25% growth in EPS mapping to a high-teens return on equity. RY's domestic banking business benefited from higher provisioning in the year-ago period. While impaired loans continue to rise, forward-looking credit metrics hint at stabilizing asset quality. RY's market-facing segments remain in a 'goldilocks' environment, showcased by 20%-plus net income growth in the Wealth and Capital Markets units.
On June 01, 2026, we delve into the DCF analysis for Royal Bank of Canada RY , a company that has shown impressive price performance over the past year. The stock has appreciated significantly, with a year-to-date increase of 12.7% and a remarkable 56.2% rise over the past year. Here are some key points to consider:
DCF Earnings-based intrinsic value of $149.91 compared to the current price of $189.53 (margin of safety: -16.4%) DCF FCF-based intrinsic value of $387.28, indicating a significantly undervalued status with a margin of safety of 51.1% GF Score™ of 77/100, suggesting a reliable foundation for the DCF inputs What Is RY Worth? DCF Earnings-Based Model The DCF earnings-based model for Royal Bank of Canada utilizes a two-stage approach to estimate the intrinsic value of the stock. The first stage accounts for a growth phase where earnings per share (EPS) is projected to grow at a rate of 7.9% annually for the next ten years. This growth is then discounted at a rate of 11%, which is derived from the risk-free rate and equity risk premium. The second stage reflects a terminal growth phase, where growth slows to 4% for the subsequent ten years, also discounted at 11%.
Parameter Value Current EPS (TTM, excl. non-recurring) $10.75 10-Year Growth Rate 7.9% 10-Year Treasury Rate 4.47% Discount Rate (ceil(Treasury) + 6%) 11% Terminal Growth Rate 4% The calculation summary for the two-stage model is as follows:
Stage Description Value Growth Stage (Years 1-10) EPS growing at 7.9%, discounted at 11% $92.31 Terminal Stage (Years 11-20) 4% terminal growth, discounted at 11% $57.60 Intrinsic Value Growth + Terminal $149.91 With the current price at $189.53, the intrinsic value calculated from the earnings-based DCF model is $149.91, indicating that the stock is fairly valued with a margin of safety of -16.4%. It is important to note that GuruFocus utilizes EPS that excludes non-recurring items, as research indicates that stock prices correlate more closely with earnings than with free cash flow. For further details, you can access the RY DCF Calculator.
What Does the Free Cash Flow DCF Say? The free cash flow (FCF) based intrinsic value for Royal Bank of Canada is calculated at $387.28. This value significantly contrasts with the earnings-based intrinsic value of $149.91, indicating a substantial discrepancy. The FCF-based valuation suggests that the stock is significantly undervalued, with a margin of safety of 51.1%. This divergence between the two models highlights the importance of considering multiple valuation approaches when assessing a stock's worth.
How Does GF Value™ Compare to the DCF Models? The GF Value™ for Royal Bank of Canada stands at $143.06, providing a third perspective on the valuation of the stock. GF Value™ is GuruFocus' proprietary measure, calculated from historical trading multiples, past business growth, and future performance estimates. When comparing all three models—DCF earnings, DCF FCF, and GF Value™—the earnings-based DCF suggests the stock is fairly valued, while the FCF model indicates it is significantly undervalued, and GF Value™ suggests it is overvalued. For more insights, visit the GF Value™ page.
What Does RY's GF Score™ Tell Us? The GF Score™ ranks stocks from 0 to 100 based on five key aspects: Financial Strength, Profitability, Growth, Valuation, and Momentum. Stocks with higher GF Score™ values have been found to generate higher long-term returns, based on backtested data from 2006 to 2021. The following table summarizes RY's GF Score™ components:
Metric Rating GF Score™ 77/100 Financial Strength 2/10 Profitability 6/10 Growth 9/10 Valuation 5/10 Momentum 10/10 With a predictability rank of 4/5 stars, this indicates that the DCF model is more reliable for Royal Bank of Canada. For further details, visit the RY stock page.
Key Assumptions and Limitations It is important to note that DCF models are highly sensitive to the assumptions made regarding growth rates and discount rates. Stocks with low predictability ratings tend to produce less reliable DCF estimates. The terminal growth rate of 4% used in this analysis is a simplifying assumption that may not reflect future market conditions.
What This Means for Investors In synthesizing the three valuation models—DCF earnings, DCF FCF, and GF Value™—we find that the earnings-based DCF suggests the stock is fairly valued, while the FCF model indicates it is significantly undervalued, and GF Value™ suggests it is overvalued. Overall, the consensus points towards a mixed valuation status, with investors advised to consider multiple perspectives before making investment decisions. For the full DCF analysis, visit the RY DCF Calculator. You can also explore the GF Value™ page, or use the GuruFocus Stock Screener to find undervalued predictable companies.
Frequently Asked Questions What is RY's intrinsic value based on DCF?
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
Royal Bank of Canada continues to outperform the broader market despite a consistently rich valuation. RY's strong brand, pricing power, scale, and diversified income streams allow it to defy traditional valuation models. I maintain a Hold rating on RY stock, recognizing the company's quality but remaining cautious on valuation grounds.
Anheuser-Busch InBev (NYSE: BUD) stock shot up almost 9% the day it reported strong Q1 2026 earnings, with the rally continuing into the next trading day.
Anheuser-Busch InBev SA/NV Today
BUD
Anheuser-Busch InBev SA/NV
$82.90 +0.64 (+0.77%)
As of 03:59 PM Eastern
This is a fair market value price provided by Massive. Learn more.
52-Week Range$56.97▼
$84.46Dividend Yield1.70%
P/E Ratio22.65
Price Target$93.42
One of the key takeaways from the report was that the company saw an increase in both revenue and volume. The latter has been a challenge in the past several quarters.
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The report also showed that Anheuser-Busch, the parent company of the Budweiser and Bud Light brands, is retaining its title as the “king of beers,” although the crown has shifted to its Corona brand.
The company reported adjusted earnings per share (EPS) of 97 cents, topping estimates of 90 cents. Anheuser-Busch also delivered revenue of $15.27 billion, beating forecasts for $14.69 billion. The revenue number matched the number from Q4 2025.
That’s why it bears repeating that the more relevant number for investors is the volume. The company is no longer having to rely on pricing power to make its numbers. That suggests that the environment for consumer discretionary stocks may be starting to normalize.
The Preference for Premium Remains in Place Part of Anheuser-Busch's strategy in recent years has been to segment its broad portfolio. This gives investors an idea of where the company’s growth comes from. It shouldn’t be too much of a surprise that one of the strongest growth areas comes from its premium brands.
In the quarter just ended, the company reported net revenue growth of 11% in its premium beer category. And the company’s Corona and Stella Artois brands are leading the way.
That was supported by the company’s broader assessment that alcohol participation is stable, with approximately 77% of legal drinking age adults having consumed alcohol in the six months prior to the report. That percentage was essentially flat year over year, indicating that the company’s strength is coming from its beer category.
This Is Not Your Father’s BUD It doesn’t take a very close look under the hood of the earnings report to see two striking data points. On the company’s list of “Replicable growth drivers,” the two largest categories in revenue growth were no-alcohol beer and Beyond Beer at 27% and 37% , respectively.
The first confirms that Millennial and Gen Z consumers are seeking alcohol-free experiences. The second category, created in 2018, houses the company’s portfolio of hard seltzers, wine and spirits, traditional malt-based beverages, and low- or no-alcohol drinks. It’s a nod to the idea that tastes are changing for those who continue to consume alcoholic beverages.
However, this is a move that investors should welcome. Like many other beer companies, Anheuser-Busch saw the writing on the wall a long time ago. The company has been diversifying its portfolio to keep up with trends that are shaping the market.
Future Catalysts—The World Cup and More Is now a good time to buy BUD? The stock is trading near its 52-week high and is rapidly approaching the consensus price target of $90.50 from 16 analysts that are tracked by MarketBeat. Furthermore, BUD is trading about 13% above its 50-day simple moving average (SMA). The immediate setup favors a pullback.
But would that be a dip worth buying? One reason to believe BUD may have catalysts ahead comes from the calendar. The World Cup begins in June and runs into July. This will be an international event attracting fans from all over the world, and particularly benefitting the company's Mid-America's segment.
There will also be many “America 250” celebrations throughout the country. Budweiser and Bud Light are likely to be key symbols of America at those events.
BUD Is a Mix of Hope and Caution Since the earnings report, several analysts have reiterated a rating of “Buy” or its equivalent. However, those ratings aren’t coming with an increase in their price targets. That’s something to be cautious about with BUD stock now sitting at a 5-year high.
Current Price$82.52High Forecast$93.83Average Forecast$93.42Low Forecast$93.00Anheuser-Busch InBev SA/NV Stock Forecast Details
And that comes after the stock had a pandemic-fueled rally that broke it out of a sharp sell-off that began in 2019. It hasn’t been a party for shareholders. Competition and a shift away from alcohol have been a drag on BUD.
But the company’s data shows a significant addressable market for alcoholic beverages. And one of the company’s primary competitors, Molson Coors NYSE: TAP delivered earnings this week with a similar volume story.
That suggests the market is there, and the decline in volume may have been linked to inflation and not interest. It’s a thesis that will require more than one quarter to play out. But with forecasted earnings growth of 13% on a stock trading around 19x earnings, it could be time to revisit BUD on any pullback.
Should You Invest $1,000 in Anheuser-Busch InBev SA/NV Right Now?Before you consider Anheuser-Busch InBev SA/NV, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Anheuser-Busch InBev SA/NV wasn't on the list.
While Anheuser-Busch InBev SA/NV currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.
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For new and old investors, taking full advantage of the stock market and investing with confidence are common goals. Zacks Premium provides lots of different ways to do both.
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Zacks Premium includes access to the Zacks Style Scores as well.
What are the Zacks Style Scores? The Zacks Style Scores is a unique set of guidelines that rates stocks based on three popular investing types, and were developed as complementary indicators for the Zacks Rank. This combination helps investors choose securities with the highest chances of beating the market over the next 30 days.
Each stock is given an alphabetic rating of A, B, C, D or F based on their value, growth, and momentum qualities. With this system, an A is better than a B, a B is better than a C, and so on, meaning the better the score, the better chance the stock will outperform.
The Style Scores are broken down into four categories:
Value ScoreFor value investors, it's all about finding good stocks at good prices, and discovering which companies are trading under their true value before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to help pick out the most attractive and discounted stocks.
Growth ScoreWhile good value is important, growth investors are more focused on a company's financial strength and health, and its future outlook. The Growth Style Score takes projected and historic earnings, sales, and cash flow into account to uncover stocks that will see long-term, sustainable growth.
Momentum ScoreMomentum investors, who live by the saying "the trend is your friend," are most interested in taking advantage of upward or downward trends in a stock's price or earnings outlook. Utilizing one-week price change and the monthly percentage change in earnings estimates, among other factors, the Momentum Style Score can help determine favorable times to buy high-momentum stocks.
VGM ScoreIf you want a combination of all three Style Scores, then the VGM Score will be your friend. It rates each stock on their combined weighted styles, helping you find the companies with the most attractive value, best growth forecast, and most promising momentum. It's also one of the best indicators to use with the Zacks Rank.
How Style Scores Work with the Zacks Rank The Zacks Rank is a proprietary stock-rating model that harnesses the power of earnings estimate revisions, or changes to a company's earnings expectations, to help investors build a successful portfolio.
#1 (Strong Buy) stocks have produced an unmatched +23.93% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.
But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.
That's where the Style Scores come in.
To maximize your returns, you want to buy stocks with the highest probability of success. This means picking stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you find yourself looking at stocks with a #3 (Hold) rank, make sure they have Scores of A or B as well to ensure as much upside potential as possible.
The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.
Here's an example: a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one with Style Scores of A and B, still has a downward-trending earnings outlook, and a bigger chance its share price will decrease too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Anheuser-Busch Inbev (BUD - Free Report) Anheuser-Busch InBev, alias AB InBev, is a global brewing company with more than 500 iconic brands. The company’s leading position in majority of its markets and a strong global footprint lends the advantage of economies of scale and growing its multi-country brands globally. Its strategy is based on efforts to develop a portfolio of brands that cater to extensive consumer needs within the market, in terms of price range, flavor profiles, and brand meaning.
BUD is a #3 (Hold) on the Zacks Rank, with a VGM Score of A.
Momentum investors should take note of this Consumer Staples stock. BUD has a Momentum Style Score of A, and shares are up 10.4% over the past four weeks.
For fiscal 2026, two analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0.00 to $4.22 per share. BUD boasts an average earnings surprise of +4.6%.
With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, BUD should be on investors' short list.
According to the World Health Organization, global alcohol consumption decreased from 5.7 to 5.0 liters per capita between 2010 and 2022. This might not seem like much, but it is more than a 12% decrease worldwide in just 12 years. This trend has continued through the present day as global consumption fell another 2% in 2025.
As health-conscious consumers purchase fewer alcoholic drinks, investors could sour on stocks such as Anheuser-Busch InBev (BUD +0.78%), but it doesn't tell the entire story and isn't likely to happen. Let's have a look at why.
Today's Change
(
0.78
%) $
0.64
Current Price
$
82.91
Anheuser-Busch beat earnings again on Tuesday, May 5, with revenue increasing 5.8% year over year. Underlying earnings per share topped 20% in the first quarter of 2026.
AB InBev is focusing on premium products, and this seems to be a bet that is paying off. The premiumization of products, combined with a focus on growing its "Beyond Beer" and no-alcohol beer categories, is the main driver behind the company's growth.
Image source: Getty Images.
In the Q1 2026 earnings release, AB InBev reported 27% increase in no-alcohol beer sales and 37% growth in Beyond Beer.
Anheuser-Busch isn't the only beverage company focusing on premium beers. This is also the approach competitor Constellation Brands is taking.
Consumers are drinking less, but that doesn't spell doom for Anheuser-Busch. In fact, the company has a solid plan to navigate this new chapter in alcohol sales. AB InBev stock is up 25% in 2026 but still trades at reasonable valuation metrics, making it a solid buy for long-term investors.
Catie Hogan has no position in any of the stocks mentioned. The Motley Fool recommends Constellation Brands. The Motley Fool has a disclosure policy.
Anheuser-Busch InBev (BUD) delivered Q1 volume growth for the first time since 2023, beating revenue and EPS expectations. BUD's non-alcoholic and non-beer segments posted solid revenue growth, but North American volumes declined 3.1%, raising concerns about key markets. A reverse DCF suggests BUD is fairly valued at ~$82.25, but a TTM PE of 22.95 and middling dividend yield limit upside.
It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.
The popular research service can help you become a smarter, more self-assured investor, giving you access to daily updates of the Zacks Rank and Zacks Industry Rank, the Zacks #1 Rank List, Equity Research reports, and Premium stock screens.
Zacks Premium includes access to the Zacks Style Scores as well.
What are the Zacks Style Scores? Developed alongside the Zacks Rank, the Zacks Style Scores are a group of complementary indicators that help investors pick stocks with the best chances of beating the market over the next 30 days.
Each stock is given an alphabetic rating of A, B, C, D or F based on their value, growth, and momentum qualities. With this system, an A is better than a B, a B is better than a C, and so on, meaning the better the score, the better chance the stock will outperform.
The Style Scores are broken down into four categories:
Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.
Growth ScoreGrowth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time.
Momentum ScoreMomentum traders and investors live by the saying "the trend is your friend." This investing style is all about taking advantage of upward or downward trends in a stock's price or earnings outlook. Employing factors like one-week price change and the monthly percentage change in earnings estimates, the Momentum Style Score can indicate favorable times to build a position in high-momentum stocks.
VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank A proprietary stock-rating model, the Zacks Rank utilizes the power of earnings estimate revisions, or changes to a company's earnings outlook, to help investors create a successful portfolio.
#1 (Strong Buy) stocks have produced an unmatched +23.7% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.
With more than 800 top-rated stocks to choose from, it can certainly feel overwhelming to pick the ones that are right for you and your investing journey.
That's where the Style Scores come in.
To maximize your returns, you want to buy stocks with the highest probability of success. This means picking stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you find yourself looking at stocks with a #3 (Hold) rank, make sure they have Scores of A or B as well to ensure as much upside potential as possible.
As mentioned above, the Scores are designed to work with the Zacks Rank, so any change to a company's earnings outlook should be a deciding factor when picking which stocks to buy.
For instance, a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one that boasts Scores of A and B, still has a downward-trending earnings forecast, and a much greater likelihood its share price will decline as well.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Anheuser-Busch Inbev (BUD - Free Report) Anheuser-Busch InBev, alias AB InBev, is a global brewing company with more than 500 iconic brands. The company’s leading position in majority of its markets and a strong global footprint lends the advantage of economies of scale and growing its multi-country brands globally. Its strategy is based on efforts to develop a portfolio of brands that cater to extensive consumer needs within the market, in terms of price range, flavor profiles, and brand meaning.
BUD is a #3 (Hold) on the Zacks Rank, with a VGM Score of A.
Additionally, the company could be a top pick for growth investors. BUD has a Growth Style Score of B, forecasting year-over-year earnings growth of 14.2% for the current fiscal year.
Three analysts revised their earnings estimate upwards in the last 60 days for fiscal 2026. The Zacks Consensus Estimate has increased $0.04 to $4.26 per share. BUD boasts an average earnings surprise of +4.6%.
With a solid Zacks Rank and top-tier Growth and VGM Style Scores, BUD should be on investors' short list.
LEADING AMERICAN MANUFACTURER CONTINUES TO DELIVER ON $600 MILLION COMMITMENT, FUELING PRODUCTION OF MICHELOB ULTRA AND MICHELOB ULTRA ZERO
, /PRNewswire/ -- Today, Anheuser-Busch (NYSE: BUD), a leading American manufacturer and maker of Michelob ULTRA, Busch Light, Budweiser, and Bud Light, announced a new $5 million investment in its Columbus, Ohio Brewery. The investment will fuel production of Michelob ULTRA, the nation's #1 top-selling and fastest-growing beer, and Michelob ULTRA Zero, the #1 top-selling and fastest-growing non-alcohol brew. Additionally, Anheuser-Busch is opening a new technical skills training center in Columbus to support the next generation of manufacturing professionals in Ohio.
Columbus Brewery This latest investment in Columbus is part of Anheuser-Busch's ongoing Brewing Futures initiative, through which the company is investing $600 million in its U.S. operations across 2025 and 2026. The initiative builds on Anheuser-Busch's commitment to investing in its people, breweries and communities by creating and sustaining manufacturing jobs, building the manufacturing workforce for the future and strengthening manufacturing career opportunities for veterans.
Brendan Whitworth, CEO, Anheuser-Busch said: "This investment in our Columbus Brewery strengthens our ability to brew the highest-quality American beers that consumers love, while creating and sustaining jobs in the communities where we operate. By continuously investing in our facilities and people, we are proud to help drive economic growth in communities like Columbus and reinforce our unwavering commitment to the future of American manufacturing."
Creating and Sustaining Manufacturing Jobs
This new $5 million investment helps expand the Columbus Brewery's capacity to produce fast-growing brands like Michelob ULTRA, the #1 top-selling and fastest-growing beer in the country. It will also increase the brewery's capacity to produce non-alcohol beers like Michelob ULTRA Zero and Michelob ULTRA Zero Lime. Michelob ULTRA Zero is the #1 top-selling non-alcohol beer, both nationwide and in the state of Ohio, according to leading market researcher Circana.
Building the Manufacturing Workforce for the Future
Building on the opening of a Regional Excellence Center on the Columbus Brewery campus in 2025, this year Anheuser-Busch is opening a new technical skills training center—one of 15 that Anheuser-Busch is opening nationwide—to upskill employees' capabilities related to mechanical and electrical systems. Anheuser-Busch plans to upskill more than 90 percent of its manufacturing workforce over the next five years.
Ryan Augsburger, President, Ohio Manufacturers' Association said: "Ohio's strongest workforce solutions start with employers. Anheuser-Busch's Columbus investment puts that model into action by building technical skills, strengthening an iconic Ohio operation and helping keep Ohio manufacturing competitive."
Strengthening Manufacturing Career Opportunities for Veterans
Anheuser-Busch is also continuing its work with the Manufacturing Institute's Heroes MAKE America initiative to provide former and current service members with resources to pursue careers in manufacturing. Through the integration of credentials that translate military training into manufacturing skills and a dedicated platform designed to showcase military skills and experience, the company is supporting veteran hiring across its facilities and expanding manufacturing career opportunities for these employees. Approximately 10% of Anheuser-Busch's Columbus workforce are veterans or active service members.
Anheuser-Busch has operated in Columbus for more than 50 years and has invested more than $71 million in this brewery over the past five years alone. Investments like these are not new for Anheuser-Busch and represent the company's dedication to serving as a key economic driver in Ohio and its longstanding efforts to strengthen the future of American manufacturing for generations to come.
For more on Anheuser-Busch's economic impact visit www.anheuser-busch.com/community/economic-impact or follow Anheuser-Busch on LinkedIn, X, Facebook, and Instagram.
ABOUT ANHEUSER-BUSCH
At Anheuser-Busch, our purpose is to create a future with more cheers. For more than 165 years as a leading American manufacturer, we have delivered a legacy of brewing great-tasting, high-quality beers that have satisfied beer drinkers for generations. As the nation's top brewer, one of the fastest growing spirits companies, and an insurgent force in energy drinks, we drive economic prosperity nationwide through investments in our people, facilities, and communities. We are the only alcohol company that invests in the U.S. at this scale.
We make the nation's most iconic beers, ready-to-drink spirits and beyond beer brands, including Michelob ULTRA – America's #1 top-selling and fastest-growing beer – Busch Light, Budweiser, Bud Light, Stella Artois, Cutwater Spirits, NÜTRL Vodka Seltzer, BeatBox, industry-leading craft beers and non-alcohol beers like Michelob ULTRA Zero. We are guided by our commitment to the communities we call home and to the 65,000 hardworking Americans who bring our products to life. That's who we are. For more information, visit www.anheuser-busch.com or follow Anheuser-Busch on LinkedIn, X, Facebook, and Instagram.
ABOUT BREWING FUTURES
Anheuser-Busch's Brewing Futures initiative builds on more than 165 years of continuous investment in our people, breweries and communities to support American manufacturing through three key pillars:
We are Creating and Sustaining Manufacturing Jobs by increasing investments in its U.S. operations to $600 million total over two years. We're also Building the Manufacturing Workforce for the Future by opening 15 new technical skills training centers at its facilities across the U.S. and collaborating with technical trade schools. Lastly, Anheuser-Busch is Strengthening Career Opportunities for Veterans by helping former and current service members pursue manufacturing careers in the private sector. These efforts build on our longstanding commitment to creating jobs and driving economic prosperity through our expanded investment in our breweries, technical skills training, and support for veterans.
LEADING AMERICAN MANUFACTURER CONTINUES TO DELIVER ON $600 MILLION COMMITMENT, FUELING PRODUCTION OF MICHELOB ULTRA AND MICHELOB ULTRA ZERO
, /PRNewswire/ -- Today, Anheuser-Busch (NYSE: BUD), a leading American manufacturer and maker of Michelob ULTRA, Busch Light, Budweiser, and Bud Light, announced a new $5 million investment in its Columbus, Ohio Brewery. The investment will fuel production of Michelob ULTRA, the nation's #1 top-selling and fastest-growing beer, and Michelob ULTRA Zero, the #1 top-selling and fastest-growing non-alcohol brew. Additionally, Anheuser-Busch is opening a new technical skills training center in Columbus to support the next generation of manufacturing professionals in Ohio.
This latest investment in Columbus is part of Anheuser-Busch's ongoing Brewing Futures initiative, through which the company is investing $600 million in its U.S. operations across 2025 and 2026. The initiative builds on Anheuser-Busch's commitment to investing in its people, breweries and communities by creating and sustaining manufacturing jobs, building the manufacturing workforce for the future and strengthening manufacturing career opportunities for veterans.
Brendan Whitworth, CEO, Anheuser-Busch said: "This investment in our Columbus Brewery strengthens our ability to brew the highest-quality American beers that consumers love, while creating and sustaining jobs in the communities where we operate. By continuously investing in our facilities and people, we are proud to help drive economic growth in communities like Columbus and reinforce our unwavering commitment to the future of American manufacturing."
Creating and Sustaining Manufacturing Jobs
This new $5 million investment helps expand the Columbus Brewery's capacity to produce fast-growing brands like Michelob ULTRA, the #1 top-selling and fastest-growing beer in the country. It will also increase the brewery's capacity to produce non-alcohol beers like Michelob ULTRA Zero and Michelob ULTRA Zero Lime. Michelob ULTRA Zero is the #1 top-selling non-alcohol beer, both nationwide and in the state of Ohio, according to leading market researcher Circana.
Building the Manufacturing Workforce for the Future
Building on the opening of a Regional Excellence Center on the Columbus Brewery campus in 2025, this year Anheuser-Busch is opening a new technical skills training center—one of 15 that Anheuser-Busch is opening nationwide—to upskill employees' capabilities related to mechanical and electrical systems. Anheuser-Busch plans to upskill more than 90 percent of its manufacturing workforce over the next five years.
Ryan Augsburger, President, Ohio Manufacturers' Association said: "Ohio's strongest workforce solutions start with employers. Anheuser-Busch's Columbus investment puts that model into action by building technical skills, strengthening an iconic Ohio operation and helping keep Ohio manufacturing competitive."
Strengthening Manufacturing Career Opportunities for Veterans
Anheuser-Busch is also continuing its work with the Manufacturing Institute's Heroes MAKE America initiative to provide former and current service members with resources to pursue careers in manufacturing. Through the integration of credentials that translate military training into manufacturing skills and a dedicated platform designed to showcase military skills and experience, the company is supporting veteran hiring across its facilities and expanding manufacturing career opportunities for these employees. Approximately 10% of Anheuser-Busch's Columbus workforce are veterans or active service members.
Anheuser-Busch has operated in Columbus for more than 50 years and has invested more than $71 million in this brewery over the past five years alone. Investments like these are not new for Anheuser-Busch and represent the company's dedication to serving as a key economic driver in Ohio and its longstanding efforts to strengthen the future of American manufacturing for generations to come.
For more on Anheuser-Busch's economic impact visit www.anheuser-busch.com/community/economic-impact or follow Anheuser-Busch on LinkedIn, X, Facebook, and Instagram.
ABOUT ANHEUSER-BUSCH
At Anheuser-Busch, our purpose is to create a future with more cheers. For more than 165 years as a leading American manufacturer, we have delivered a legacy of brewing great-tasting, high-quality beers that have satisfied beer drinkers for generations. As the nation's top brewer, one of the fastest growing spirits companies, and an insurgent force in energy drinks, we drive economic prosperity nationwide through investments in our people, facilities, and communities. We are the only alcohol company that invests in the U.S. at this scale.
We make the nation's most iconic beers, ready-to-drink spirits and beyond beer brands, including Michelob ULTRA – America's #1 top-selling and fastest-growing beer – Busch Light, Budweiser, Bud Light, Stella Artois, Cutwater Spirits, NÜTRL Vodka Seltzer, BeatBox, industry-leading craft beers and non-alcohol beers like Michelob ULTRA Zero. We are guided by our commitment to the communities we call home and to the 65,000 hardworking Americans who bring our products to life. That's who we are. For more information, visit www.anheuser-busch.com or follow Anheuser-Busch on LinkedIn, X, Facebook, and Instagram.
ABOUT BREWING FUTURES
Anheuser-Busch's Brewing Futures initiative builds on more than 165 years of continuous investment in our people, breweries and communities to support American manufacturing through three key pillars:
We are Creating and Sustaining Manufacturing Jobs by increasing investments in its U.S. operations to $600 million total over two years. We're also Building the Manufacturing Workforce for the Future by opening 15 new technical skills training centers at its facilities across the U.S. and collaborating with technical trade schools.Lastly, Anheuser-Busch is Strengthening Career Opportunities for Veterans by helping former and current service members pursue manufacturing careers in the private sector.These efforts build on our longstanding commitment to creating jobs and driving economic prosperity through our expanded investment in our breweries, technical skills training, and support for veterans.
View original content to download multimedia:https://www.prnewswire.com/news-releases/anheuser-busch-invests-5-million-in-columbus-brewery-expands-local-manufacturing-skills-training-302770099.html
LONDON--(BUSINESS WIRE)--Corona global has been recognized as the most valuable beer brand in the world for the third consecutive year in Kantar's BrandZ 2026 Most Valuable Global Brands report, released today. Eight out of the top ten most valuable global beer brands belong to AB InBev (Brussel:ABI) (BMV:ANB) (JSE:ANH) (NYSE:BUD), according to the report ranking the best brands in the world.
In 2025, Corona led AB InBev’s performance, increasing revenue by 8.3% outside of its home market with double-digit volume growth in 30 markets, while Corona Cero delivered strong double-digit volume growth. As the brand celebrated its 100th anniversary, Corona launched its global “Corona 100” platform, including a multi-year sponsorship of a renowned concert at Copacabana Beach in Rio de Janeiro. Strong momentum continued in Q1 2026, with AB InBev delivering all-time high revenues and volume growth, led by Corona, which grew 16% outside its home market following a successful debut as the world’s first global beer sponsor of The Winter Olympics.
In Kantar’s BrandZ 2026 rankings, Corona is followed by Budweiser as the second most valuable beer brand in the world, with Modelo, Michelob ULTRA, Brahma, Bud Light, Skol and Stella Artois helping AB InBev secure 8 of the world’s top 10 most valuable beer brands.
“Corona’s recognition as the most valuable beer brand in the world for three consecutive years reflects our approach to building brands for long-term, sustainable growth,” said Marcel Marcondes, Global Chief Marketing Officer. “For AB InBev to have 8 of the top 10 beer brands in Kantar BrandZ’s 2026 rankings underscores the focus, consistency and creative effectiveness of our teams and partners around the world.”
BrandZ charts the way in which global brands have continued to evolve and innovate. Now in its 21st edition, it spotlights the importance of building meaningful difference where a brand meets consumer needs, stands out from competitors and remains top-of-mind in its sector for a prolonged period.
“Corona’s performance in Kantar BrandZ’s global rankings shows what strong brands achieve when they are built with discipline, over time. Brand value comes from being meaningfully different in ways people recognise, showing up consistently and staying relevant as the world changes. That doesn’t change, even as technology introduces new ways for people to discover and interact with brands. Marketers still need to make clear decisions about what their brand stands for and how it shows up in the real world. That’s something the Corona team continues to get right,” said Paul Zwillenberg, CEO of Kantar.
Kantar BrandZ is a global ranking that assesses brand value by combining financial data and extensive brand equity research, offering an in-depth view of over 22,000 brands in 54 markets.
About AB InBev
Anheuser-Busch InBev (AB InBev) is a publicly traded company (Euronext: ABI) based in Leuven, Belgium, with secondary listings on the Mexico (MEXBOL: ANB) and South Africa (JSE: ANH) stock exchanges and with American Depositary Receipts on the New York Stock Exchange (NYSE: BUD). As a company, we dream big to create a future with more cheers. We are always looking to serve up new ways to meet life’s moments, move our industry forward and make a meaningful impact in the world. We are committed to building great brands that stand the test of time and to brewing the best beers using the finest ingredients. Beer is the drink for moderation, and for over a century, AB InBev has championed responsible drinking. We are committed to providing our consumers with Balanced Choices to enjoy on any occasion. We also invest in marketing that aims to reinforce positive behaviors, and we work with communities, customers, and partners to promote responsible consumption through evidence-based initiatives.
Our diverse portfolio of well over 400 beer brands includes global brands Budweiser®, Corona®, Stella Artois® and Michelob Ultra®; multi-country brands Beck’s®, Hoegaarden® and Leffe®; and local champions such as Aguila®, Antarctica®, Bud Light®, Brahma®, Cass®, Castle®, Castle Lite®, Cristal®, Harbin®, Jupiler®, Modelo Especial®, Quilmes®, Victoria®, Sedrin®, and Skol®. Our brewing heritage dates back more than 600 years, spanning continents and generations. From our European roots at the Den Hoorn brewery in Leuven, Belgium. To the pioneering spirit of the Anheuser & Co brewery in St. Louis, US. To the creation of the Castle Brewery in South Africa during the Johannesburg gold rush. To Bohemia, the first brewery in Brazil. Geographically diversified with a balanced exposure to developed and developing markets, we leverage the collective strengths of approximately 137 000 colleagues based in more than 40 countries worldwide. For 2025, AB InBev’s reported revenue was 59.3 billion USD (excluding JVs and associates).
About Kantar
Kantar is the world’s leading marketing data and analytics business. We deliver the intelligence needed to power brand growth.
We provide the signals that help organisations act quickly and confidently. We empower brands to make effective marketing decisions based on predictive evidence. And we help them craft powerful growth strategies rooted in the connection between consumers, brands and enterprise value. All this is powered by our uniquely robust human and synthetic data, our unrivalled IP, our AI-native platform and the team of global brand experts that bring this all together.
About Kantar BrandZ
Kantar BrandZ is the global currency when assessing brand value, quantifying the contribution of brands to business’ financial performance. Kantar’s annual global and local brand valuation rankings combine rigorously analysed financial data, with extensive brand equity research. Since 1998, BrandZ has shared brand-building insights with business leaders based on interviews with 4.6 million consumers, for over 22,000 brands in 54 markets. Discover more about Kantar BrandZ here.
FOX Business correspondent Grady Trimble reports on Anheuser-Busch's preparations for the FIFA World Cup as official beer partner and the surge in alcohol consumption in the host cities on 'Mornings with Maria.' 00:00 Anheuser-Busch prepares for the World Cup 00:44 Massive increase in beer sales expected 01:13 Comparing the World Cup impact to the Super Bowl 01:41 Inside the canning and bottling process 02:14 A boost for the declining beer industry
LEADING AMERICAN MANUFACTURER CONTINUES TO DELIVER ON $600 MILLION COMMITMENT, FUELING PRODUCTION OF MICHELOB ULTRA
What's in this story:
Anheuser-Busch announces $5.8M investment in Williamsburg, VA brewery Investment fuels production of Michelob ULTRA, the nation's #1 top-selling and fastest-growing beer, and funds new technical skills training center for employees Part of company's $600 million commitment to strengthen American manufacturing , /PRNewswire/ -- Today, Anheuser-Busch (NYSE: BUD), a leading American manufacturer and maker of Michelob ULTRA, Busch Light, Budweiser, and Bud Light, announced a new $5.8 million investment in its Williamsburg, Virginia Brewery. The investment will help fuel production of Michelob ULTRA, the nation's #1 top-selling and fastest-growing beer and fund the creation of a new technical skills training center in Williamsburg to support the next generation of manufacturing professionals in Virginia.
Williamsburg Brewery This latest investment in Williamsburg is part of Anheuser-Busch's ongoing Brewing Futures initiative, through which the company is investing $600 million in its U.S. operations across 2025 and 2026. The initiative builds on Anheuser-Busch's commitment to investing in its people, breweries, and communities by creating and sustaining manufacturing jobs, building the manufacturing workforce for the future, and strengthening manufacturing career opportunities for veterans.
Brendan Whitworth, CEO, Anheuser-Busch said: "This investment in our Williamsburg Brewery allows us to continue producing the highest-quality, American beers we have crafted for generations, while supporting jobs and economic growth in the communities where we operate. By continuing to invest in places like Williamsburg, we reaffirm our longstanding commitment to the future of American manufacturing and to supporting veterans."
Creating and Sustaining Manufacturing Jobs
This new $5.8 million investment helps ensure that Anheuser-Busch remains at the forefront of brewing excellence in the region and strengthen the Williamsburg Brewery's capacity to produce fast-growing brands like Michelob ULTRA, the #1 top-selling and fastest-growing beer in the entire country and the Commonwealth of Virginia, according to Circana.
Tom Jokerst, General Manager, Anheuser-Busch Williamsburg Brewery said: "Since 1972, the Anheuser-Busch Williamsburg Brewery has been a cornerstone of our community. This $5.8 million investment demonstrates our ongoing dedication to brewing excellence and is the latest example of Anheuser-Busch's commitment to supporting our local economy, building the workforce for the future, and strengthening career opportunities for veterans on our team."
Building the Manufacturing Workforce for the Future
This investment will also fund a new technical skills training center in Williamsburg—one of 15 that Anheuser-Busch is opening nationwide—to upskill employees' capabilities, from technical fundamentals and digital tools to management systems and mechanical and electrical systems Anheuser-Busch plans to upskill more than 90% of its manufacturing workforce over the next five years.
Strengthening Manufacturing Career Opportunities for Veterans
Anheuser-Busch is also continuing its work with the Manufacturing Institute's Heroes MAKE America initiative to provide former and current service members with resources to pursue careers in manufacturing. Through the integration of credentials that translate military training into manufacturing skills and a dedicated platform designed to showcase military skills and experience, the company is supporting veteran hiring across its facilities and expanding manufacturing career opportunities for these employees. The Williamsburg Brewery is proud to employ the most veterans and active service members out of all Anheuser-Busch's U.S. breweries; nearly 20% of Anheuser-Busch's Williamsburg workforce are veterans or active service members.
On Saturday, May 30, 2026, the Williamsburg Brewery will celebrate Budweiser's 150th Anniversary and honor America's 250th birthday with a public event from noon to 4 p.m. featuring day-fresh brews, local food vendors, and lawn games. The world-renowned Budweiser Clydesdales will also make a special appearance in support of Anheuser-Busch's 16-year partnership with Folds of Honor, a nonprofit that provides life-changing educational scholarships to the families of fallen or disabled U.S. service members and first responders.
Anheuser-Busch has operated in Williamsburg for more than 50 years and has invested nearly $50 million in this brewery over the past five years alone. Investments like these are not new for Anheuser-Busch and represent the company's dedication to serving as a key economic driver in Virginia and to strengthening the future of American manufacturing for generations to come.
For more on Anheuser-Busch's economic impact visit www.anheuser-busch.com/community/economic-impact or follow Anheuser-Busch on LinkedIn, X, Facebook, and Instagram.
ABOUT ANHEUSER-BUSCH
At Anheuser-Busch, our purpose is to create a future with more cheers. For more than 165 years as a leading American manufacturer, we have delivered a legacy of brewing great-tasting, high-quality beers that have satisfied beer drinkers for generations. As the nation's top brewer, one of the fastest growing spirits companies, and an insurgent force in energy drinks, we drive economic prosperity nationwide through investments in our people, facilities, and communities. We are the only alcohol company that invests in the U.S. at this scale.
We make the nation's most iconic beers, ready-to-drink spirits and beyond beer brands, including Michelob ULTRA – America's #1 top-selling and fastest-growing beer – Busch Light, Budweiser, Bud Light, Stella Artois, Cutwater Spirits, NÜTRL Vodka Seltzer, BeatBox, industry-leading craft beers and non-alcohol beers like Michelob ULTRA Zero. We are guided by our commitment to the communities we call home and to the 65,000 hardworking Americans who bring our products to life. That's who we are. For more information, visit www.anheuser-busch.com or follow Anheuser-Busch on LinkedIn, X, Facebook, and Instagram.
Blue-chip stocks are shares of large, well-established, financially stable companies with a consistent and reliable performance history. They are often considered less risky and are a popular choice for long-term investors. Nearly all leaders in the category pay dependable, recurring dividends each quarter, regardless of the state of the economy. Our $100,000 blue-chip value portfolio is designed for Boomers and retirees seeking dependable passive income from high-quality companies that pay big dividends. The term “blue chip” originated in poker, where it refers to the highest-value chip.
Passive income is characterized by its ability to generate revenue without requiring the earner’s continuous active effort, making it a desirable financial strategy for those seeking to diversify their income streams or achieve financial independence. The more passive income can help cover rising costs, such as mortgages, insurance, taxes, and other expenses, the easier it is for investors to set aside money for future needs as they prepare for retirement. Dependable recurring dividends from quality, high-yield stocks are a recipe for success, and blue-chip dividend-paying companies are the perfect vehicles to achieve it.
We put together a growth-and-income portfolio with five of the highest-yielding value blue-chip giants. Investing $20,000 in each will generate $6,500 in safe, predictable passive income. Investors could increase that amount by selling covered call options on their holdings. Plus, since these companies often raise their dividends, the income is likely to increase slightly each year. The purchase amounts and dividend income totals are based on the time this post was written.
Why do we cover blue-chip value dividend stocks?
Since 1926, dividends have accounted for approximately 32% of the S&P 500’s total return, while capital appreciation has accounted for 68%. Therefore, sustainable dividend income and the potential for capital appreciation are essential to total return expectations. A study by Hartford Funds, in collaboration with Ned Davis Research, found that dividend stocks delivered an annualized return of 9.18% over the 50 years from 1973 to 2023. Over the same timeline, this was more than double the annualized return for non-payers (3.95%).
Altria Altria Group (NYSE: MO | MO Price Prediction) is one of the world’s largest producers and marketers of cigarettes and other tobacco-related products. It offers long-term value and a 6.01% dividend. Altria manufactures and sells smokable and oral tobacco products in the United States. The company primarily sells cigarettes under the Marlboro brand, as well as:
Cigars and pipe tobacco, principally under the Black & Mild and Middleton brands Moist smokeless tobacco and snus products under the Copenhagen, Skoal, Red Seal, and Husky brands on! Oral nicotine pouches e-vapor products under the NJOY ACE brand It sells its tobacco products primarily to wholesalers, including distributors and large retail organizations, such as chain stores.
Altria used to own over 10% of Anheuser-Busch InBev (NYSE: BUD), the world’s largest brewer. In 2024, the company sold 35 million of its 197 million shares through a global secondary offering. That represents 18% of its holdings but still leaves 8% of the outstanding shares in its back pocket. Altria also announced a $2.4 billion stock repurchase plan partially funded by the sale.
Altria increased its quarterly dividend in the fall of 2025 by 3.9%, from $1.02 to $1.06 per share, marking its 55th consecutive annual dividend increase.
$20,000 will buy 280 shares, which pay $4.24 per year for a total of $1,187.
Stifel has a Buy rating with a $77 target price.
Energy Transfer Energy Transfer (NYSE: ET) is one of North America’s largest and most diversified midstream energy companies. This top master limited partnership is a safe option for investors seeking energy exposure and income, as the company pays a 6.81% distribution yield. Energy Transfer owns and operates one of the largest and most diversified portfolios of energy assets in the United States, with a strategic footprint across all major domestic production basins.
The company is a publicly traded limited partnership with core operations that include:
Complementary natural gas midstream, intrastate, and interstate transportation and storage assets Crude oil, natural gas liquids (NGL), and refined product transportation and terminalling assets NGL fractionation Various acquisition and marketing assets Following the acquisition of Enable Partners in December 2021, Energy Transfer owns and operates over 114,000 miles of pipelines and related assets in 41 states, spanning all major U.S. producing regions and markets. This reinforces its leadership position in the midstream sector.
Through its ownership of Energy Transfer Operating, formerly known as Energy Transfer Partners, the company also owns Lake Charles LNG; the general partner interests, the incentive distribution rights, and 28.5 million standard units of Sunoco; and the public partner interests and 39.7 million standard units of USA Compression Partners.
$20,000 will purchase 995 shares, which pay $1.35 per year, for a total of $1,343.
Wells Fargo has an Overweight rating on the shares, with a $25 target price.
General Mills With products that never go out of style and a strong 7.12% dividend yield, this is a rebound story that will reward patient investors. General Mills (NYSE: GIS) is a global manufacturer and marketer of branded consumer foods, and trades at a cheap 10.4 times estimated 2026 earnings. Its segments include:
North America Retail International North America Pet North America Foodservice The North America Retail segment reflects business with a variety of grocery stores, mass merchandisers, membership stores, natural food chains, drug, dollar, and discount chains, convenience stores, and e-commerce grocery providers.
The International segment consists of retail and foodservice businesses outside the United States and Canada. Its product categories include super-premium ice cream and frozen desserts, meal kits, salty snacks, snack bars, dessert and baking mixes, and shelf-stable vegetables.
The North America Pet segment includes pet food products sold in the United States and Canada in national pet superstore chains, e-commerce retailers, and grocery stores.
The North America Foodservice segment product categories include ready-to-eat cereals, snacks, and baking mixes.
$20,000 will buy 595 shares, which will pay $2.44 per year, for a total of $1,451.
Piper Sandler has an Overweight rating and a $41 target price.
UPS United Parcel Service (NYSE: UPS) announced last year that it would cut its shipping volume for e-commerce giant Amazon by more than 50% by the second half of 2026, and it was one of the best ideas among the top dividend picks, with a dividend yield now at 6.66%. The package delivery company faced headwinds from discontinuing its Amazon business and expectations of slower economic growth. It said the move is part of UPS’s broader strategy to focus on more profitable, less risky business segments. UPS provides a range of integrated logistics solutions for customers in more than 200 countries and territories.
While UPS has never trimmed its dividend since listing in 1999, that track record offers reassurance rather than a guarantee. The growth may pause, but a cut remains off the table for now.
Its segments include:
U.S. Domestic Package International Package The U.S. Domestic Package segment offers a range of domestic air and ground package transportation services within the United States. Its air portfolio offers time-definite, same-day, next-day, two-day, and three-day delivery alternatives as well as air cargo services. UPS’s ground network enables customers to ship using its day-definite ground service. UPS SurePost provides residential ground service for customers with non-urgent, lightweight residential shipments.
The International Package segment comprises its small package operations in Europe, the Indian subcontinent, the Middle East and Africa, Canada, Latin America, and Asia. It offers a selection of guaranteed day- and time-definite international shipping services. Its supply chain solutions consist of forwarding, logistics, and other businesses.
$20,000 will buy 202 shares, which pay $6.56 per year, for a total of $1,325.
Jefferies has a Buy rating with a $130 price objective.
Verizon Verizon Communications (NYSE: VZ) is an American multinational telecommunications company that continues to offer tremendous value. It trades at 9.37 times its estimated 2026 earnings, and pays a 6% dividend. Verizon provides a range of communications, technology, information, and entertainment products and services to consumers, businesses, and government entities worldwide.
Verizon’s trailing 12-month interest coverage ratio is 4.6× to 5×, providing ample cushion for dividend payments. With a very predictable revenue stream from telecom services, the company has less exposure to commodity cycles. In addition, the large scale helps in financing and absorbing shocks.
It operates in two segments. The Consumer Group segment provides wireless services across the United States through Verizon and TracFone networks, as well as through wholesale and other arrangements. It also provides fixed wireless access (FWA) broadband through its wireless networks and related equipment and devices, such as:
Smartphones Tablets Smartwatches and other wireless-enabled connected devices The segment also offers wireline services in the Mid-Atlantic and northeastern United States through its fiber-optic network, Verizon Fios product portfolio, and copper-based network.
The Business Group segment provides wireless and wireline communications services and products, including:
FWA broadband Data Video and conferencing Corporate networking Security and managed network Local and long-distance voice Network access services to deliver various IoT services and products to businesses, government customers, and wireless and wireline carriers in the United States and internationally.
$20,000 will purchase 422 shares, which pay $2.83 per year, for a total of $1,195.
Raymond James has an Outperform rating and a $56 price target.
About a decade ago, sales of LaCroix began to skyrocket. Soon, flavored seltzers were everywhere, from grocery store refrigerators to liquor store shelves.
But the era of bubbles looks like it is winding down, thanks to seltzer fatigue. Now, non-carbonated drinks, from Liquid Death to Surfside Iced Teas, are taking the spotlight.
"If you think about where there's more growth, where there's more consumer interest relative to a few years ago, it's a shift more to still, across both [alcohol] and non-alc," said Randy Burt, Americas director of consumer products at consulting firm AlixPartners.
That's not to say seltzers and other carbonated beverages will disappear. But their growth has slowed, as Generation Z increasingly seeks out options without bubbles and beverage companies focus more of their innovation efforts on fizz-free drinks.
Look no further than the alcohol category. Malt-based hard seltzers, which includes White Claw, saw volume drop 1.1% in the 52 weeks ended April 26, compared with the year-ago period, according to data from market research firm Circana. On the other hand, ready-to-drink premixed cocktails saw volume grow 46.4% in the same time, fueled by growth from Surfside, Sun Cruiser, BuzzBallz and Anheuser-Busch InBev's Cutwater Spirits, which has both carbonated and non-carbonated options.
Bursting bubblesMuch of the driving force behind the switch from bubbly to noncarbonated drinks is coming from Gen Z, which is typically defined as people born between 1997 and 2012. Over their lifetime, soda consumption has dropped dramatically from its peak in 1998, reusable water bottles have become a staple accessory, and a plethora of new drinks like refreshers and dirty soda have gone mainstream.
Broadly, Gen Z wants to try new products. While older generations show more brand loyalty to their favorite beer or cocktail, younger consumers have a different mentality.
"We're seeing a lot of promiscuity within consumption and alcohol around new products," said Scott Scanlon, executive vice president of alcoholic beverages for Circana, citing the rise of White Claw and Truly about eight years ago. "Now what we're seeing is then consumers jump to the newest product — that's Surfside, Sun Cruiser because of that."
He sees a generational shift between Gen Z and their predecessors, millennials, who couldn't get enough of seltzers.
As Gen Z reaches drinking age, their alcoholic preferences reflect that generational divide. Non-carbonated alcoholic drinks like Surfside and BeatBox are stealing "share of throat" from hard seltzers, which have seen their growth slow.
"Gen Z is a lot more likely to order tea-based beverages at happy hour, and they're sort of moving from carbonated — or seltzers — as their default, 'better for you' pick," Burt said. "I think that's part of the shift, toward wellness and functionality that you're seeing happen, especially from a Gen Z perspective."
For fans of some beverages, like functional teas and coffees that target stress relief or immune support, going fizz-free makes more sense, given the drinks' non-carbonated base.
Plus, some consumers do not view carbonation as the healthy option.
Carbonated water is slightly acidic, which can wear down tooth enamel when consumed in large quantities, especially if the seltzer uses citric acid for flavoring. Plus fizzy drinks can cause bloating and burping for some people. And then there's the association bubbles of any kind can share with sugary sodas.
What's the tea? Alcohol is leading the trend, thanks to the meteoric rise of Surfside.
Indie vodka distiller Stateside Brands launched the hard iced tea brand in 2022. The ready-to-drink beverage uses vodka as a base and iced tea and lemonade as a mixer.
At the time of its launch, carbonation was everywhere across the alcohol industry.
"Among the options out there were carbonated iced tea and carbonated lemonade, which is a little less unusual, but we were just like 'What the heck, man? Who carbonates iced tea?' That seems unholy," said Stateside co-founder and CEO Clement Pappas.
Consumers seemed to agree. By 2024, Surfside was the fastest-growing alcohol brand in the U.S., based on Nielsen IQ data.
"I think there was a huge pent-up demand for non-carbonated options," Pappas said. "There are very few out there, especially in a ready-to-drink format."
Surfside's customer base skews female. Pappas said that many of the brand's fans dislike carbonation because they find it leads to bloating, particularly after consuming several drinks in a sitting.
Stateside is leaning further into fizz-free beverages with its latest brand: Super Lyte. The brand still uses vodka as a base, but the mixer is inspired by classic sports drinks.
While Surfside may have popped the seltzer bubble, other non-carbonated alcoholic drinks have grown quickly since then.
Volume growth of Cutwater's canned cocktails has nearly doubled over the last year, according to Scanlon. BeatBox, a wine-based punch brand that is majority owned by InBev, has also seen demand for its drinks skyrocket since the alcohol giant has ramped up its distribution. And then there is BuzzBallz pre-mixed cocktails, which launched in 2009 but has seen its growth rocket after its acquisition by Sazerac in 2024.
Established alcohol players have also been trying to take on Surfside, further boosting the profile of non-carbonated drinks in the category. Twisted Tea owner Boston Beer launched Sun Cruiser in 2024 with the aim of directly competing with Surfside.
So far, Surfside retains a bigger slice of overall market share, although Sun Cruiser is growing faster these days.
Bubble-free Celsius heats upOn the non-alcoholic side, the shift toward bubble-free drinks isn't as strong, according to AlixPartners' Burt. Some carbonated drinks are still showing strong growth; PepsiCo's Poppi, as well as energy drinks like Celsius and Ghost, are seeing strong demand.
But there are signs that the soft drink landscape is shifting.
Celsius, for example, expanded its fizz-free line of energy drinks earlier this year, inspired by Gen Z's focus on wellness and the general trend toward noncarbonated beverages in other categories. Typically, carbonated options dominate the energy drink aisle, allowing Celsius to stand out and win over customers who might otherwise stick to tea or coffee for their caffeine fix.
The brand's pre-existing noncarbonated peach mango green tea flavor is consistently a top 10 performer for Celsius and is currently in the number four slot across all of its flavors, according to Celsius Chief Brand Officer Kyle Watson.
The expanded line has helped Celsius grow sales from Gen Z and women, two key segments in the energy drink category.
"In focus groups that we've had ... even our brand ambassadors across all of our universities, a lot of them talk about how they don't like drinking sparkling," Watson said.
When consumers drink "functional beverages — like those touting high protein content, prebiotics, caffeine or other benefits — they want "a better flavor experience," according to Watson.
Watson said that part of the appeal of the fizz-free line is how it goes down "really smooth," making it a better pairing for meals. About 37% of Celsius consumers consume their energy drinks with a meal, according to Watson.
And Celsius has made sure to put its noncarbonated bona fides front and center of the line's packaging.
"With the expansion, we also wanted to make sure that the callout around being fizz-free and that attribute of it being noncarbonated and having that smooth, refreshing flavor profile was more prevalent on the actual can design," Watson said.
Some other beverage brands are betting big on the swing away from fizz.
"Our product is extremely drinkable because of the lack of carbonation," Hint CEO Michael Pengue said in an interview.
Founded in 2005, the flavored water company has a devoted fan base, particularly in Silicon Valley. But the brand has gotten "dusty," and its growth has stagnated, according to Pengue. He is hoping that consumers' shift away from bubbles will boost sales, along with new packaging and a sexy new ad campaign. (While Hint has some sparkling options, it is a much smaller part of the brand's portfolio, according to Pengue.)
Earlier in Pengue's career, he led Nestle's water and tea brands, which includes Perrier and San Pellegrino.
"I was on the other side of carbonation when carbonated soft drink consumers were looking for healthier alternatives, getting away from aspartame or high fructose corn syrup, and they moved over to Perrier, San Pellegrino, Polar, LaCroix," he said. "All of sparkling [water] exploded. We're seeing the same exact thing now, just the opposite."
Hint's still flavored water offers "drinkability" and "pure hydration", giving the brand an edge over sparkling waters that cannot be drank as quickly, according to Pengue. He said it also has a "sensory softness" that appeals to consumers who do not like the bite of carbonation.
Can-do attitudeFor decades, an aluminum can with a pull tab usually meant a carbonated beverage like beer, soda or seltzer was inside.
But these days, most new non-carbonated drinks are coming in cans, resembling the seltzers and bubbly drinks from which they are stealing share.
"The can is winning," Ball CEO Ronald Lewis said on the company's earnings conference call earlier this month.
He would know. Ball is the world's largest manufacturer of aluminum packaging.
Celsius's Watson credits Liquid Death with paving the way for consumers to accept fizz-free canned drinks.
When Liquid Death founder Mike Cessario started the company in 2017, he could not find a single bottler in the U.S. capable of putting still water in cans. Non-carbonated drinks require a quick dose of nitrogen to keep the can from collapsing on itself, presenting one issue for bottlers; carbonation creates high internal pressure to allows a can to keep its shape.
Cessario told CNBC that the key to getting consumers to buy canned water — an otherwise unthinkable proposition — was by positioning Liquid Death as a cool brand.
"We designed it to look more like a beer than a water, so it felt like something a lot more familiar to people than just like a weird bottled water in a can," Cessario said.
Liquid Death has since launch sparkling and flavored sparkling lines, although it returned to its non-carbonated roots with iced tea in 2023.
For beverage companies, aluminum cans are typically cheaper than glass bottles and a more sustainable option than plastic bottles.
And for consumers, cans feel colder — and maybe even cooler, a callback to the last wave of trendy beverages during the seltzer boom.
For new and old investors, taking full advantage of the stock market and investing with confidence are common goals. Zacks Premium provides lots of different ways to do both.
The popular research service can help you become a smarter, more self-assured investor, giving you access to daily updates of the Zacks Rank and Zacks Industry Rank, the Zacks #1 Rank List, Equity Research reports, and Premium stock screens.
Zacks Premium also includes the Zacks Style Scores.
What are the Zacks Style Scores? The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.
Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.
The Style Scores are broken down into four categories:
Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.
Growth ScoreGrowth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time.
Momentum ScoreMomentum traders and investors live by the saying "the trend is your friend." This investing style is all about taking advantage of upward or downward trends in a stock's price or earnings outlook. Employing factors like one-week price change and the monthly percentage change in earnings estimates, the Momentum Style Score can indicate favorable times to build a position in high-momentum stocks.
VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank The Zacks Rank is a proprietary stock-rating model that harnesses the power of earnings estimate revisions, or changes to a company's earnings expectations, to help investors build a successful portfolio.
#1 (Strong Buy) stocks have produced an unmatched +23.7% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.
But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.
That's where the Style Scores come in.
You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only has a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.
The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.
A stock with a #4 (Sell) or #5 (Strong Sell) rating, for instance, even one with Scores of A and B, will still have a declining earnings forecast, and a greater chance its share price will fall too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Anheuser-Busch Inbev (BUD - Free Report) Anheuser-Busch InBev, alias AB InBev, is a global brewing company with more than 500 iconic brands. The company’s leading position in majority of its markets and a strong global footprint lends the advantage of economies of scale and growing its multi-country brands globally. Its strategy is based on efforts to develop a portfolio of brands that cater to extensive consumer needs within the market, in terms of price range, flavor profiles, and brand meaning.
BUD is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.
Momentum investors should take note of this Consumer Staples stock. BUD has a Momentum Style Score of A, and shares are up 13.8% over the past four weeks.
Five analysts revised their earnings estimate higher in the last 60 days for fiscal 2026, while the Zacks Consensus Estimate has increased $0.08 to $4.30 per share. BUD also boasts an average earnings surprise of +4.6%.
With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, BUD should be on investors' short list.
Taking full advantage of the stock market and investing with confidence are common goals for new and old investors, and Zacks Premium offers many different ways to do both.
The research service features daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, all of which will help you become a smarter, more confident investor.
Zacks Premium also includes the Zacks Style Scores.
What are the Zacks Style Scores? The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.
Each stock is assigned a rating of A, B, C, D, or F based on their value, growth, and momentum characteristics. Just like in school, an A is better than a B, a B is better than a C, and so on -- that means the better the score, the better chance the stock will outperform.
The Style Scores are broken down into four categories:
Value ScoreFinding good stocks at good prices, and discovering which companies are trading under their true value, are what value investors like to focus on. So, the Value Style Score takes into account ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to highlight the most attractive and discounted stocks.
Growth ScoreGrowth investors, on the other hand, are more concerned with a company's financial strength and health, and its future outlook. The Growth Style Score examines things like projected and historic earnings, sales, and cash flow to find stocks that will experience sustainable growth over time.
Momentum ScoreMomentum trading is all about taking advantage of upward or downward trends in a stock's price or earnings outlook, and these investors live by the saying "the trend is your friend." The Momentum Style Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.
VGM ScoreWhat if you like to use all three types of investing? The VGM Score is a combination of all Style Scores, making it one of the most comprehensive indicators to use with the Zacks Rank. It rates each stock on their combined weighted styles, which helps narrow down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank A proprietary stock-rating model, the Zacks Rank utilizes the power of earnings estimate revisions, or changes to a company's earnings outlook, to help investors create a successful portfolio.
It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +23.7% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.
With more than 800 top-rated stocks to choose from, it can certainly feel overwhelming to pick the ones that are right for you and your investing journey.
That's where the Style Scores come in.
You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only has a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.
As mentioned above, the Scores are designed to work with the Zacks Rank, so any change to a company's earnings outlook should be a deciding factor when picking which stocks to buy.
Here's an example: a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one with Style Scores of A and B, still has a downward-trending earnings outlook, and a bigger chance its share price will decrease too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Anheuser-Busch Inbev (BUD - Free Report) Anheuser-Busch InBev, alias AB InBev, is a global brewing company with more than 500 iconic brands. The company’s leading position in majority of its markets and a strong global footprint lends the advantage of economies of scale and growing its multi-country brands globally. Its strategy is based on efforts to develop a portfolio of brands that cater to extensive consumer needs within the market, in terms of price range, flavor profiles, and brand meaning.
BUD is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.
Additionally, the company could be a top pick for growth investors. BUD has a Growth Style Score of B, forecasting year-over-year earnings growth of 15.3% for the current fiscal year.
Five analysts revised their earnings estimate higher in the last 60 days for fiscal 2026, while the Zacks Consensus Estimate has increased $0.08 to $4.30 per share. BUD also boasts an average earnings surprise of +4.6%.
With a solid Zacks Rank and top-tier Growth and VGM Style Scores, BUD should be on investors' short list.
It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.
Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor.
Zacks Premium includes access to the Zacks Style Scores as well.
What are the Zacks Style Scores? The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.
Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.
The Style Scores are broken down into four categories:
Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.
Growth ScoreGrowth investors, on the other hand, are more concerned with a company's financial strength and health, and its future outlook. The Growth Style Score examines things like projected and historic earnings, sales, and cash flow to find stocks that will experience sustainable growth over time.
Momentum ScoreMomentum trading is all about taking advantage of upward or downward trends in a stock's price or earnings outlook, and these investors live by the saying "the trend is your friend." The Momentum Style Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.
VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank The Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.
#1 (Strong Buy) stocks have produced an unmatched +23.7% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.
With more than 800 top-rated stocks to choose from, it can certainly feel overwhelming to pick the ones that are right for you and your investing journey.
That's where the Style Scores come in.
To maximize your returns, you want to buy stocks with the highest probability of success. This means picking stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you find yourself looking at stocks with a #3 (Hold) rank, make sure they have Scores of A or B as well to ensure as much upside potential as possible.
As mentioned above, the Scores are designed to work with the Zacks Rank, so any change to a company's earnings outlook should be a deciding factor when picking which stocks to buy.
For instance, a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one that boasts Scores of A and B, still has a downward-trending earnings forecast, and a much greater likelihood its share price will decline as well.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Anheuser-Busch Inbev (BUD - Free Report) Anheuser-Busch InBev, alias AB InBev, is a global brewing company with more than 500 iconic brands. The company’s leading position in majority of its markets and a strong global footprint lends the advantage of economies of scale and growing its multi-country brands globally. Its strategy is based on efforts to develop a portfolio of brands that cater to extensive consumer needs within the market, in terms of price range, flavor profiles, and brand meaning.
BUD is a #3 (Hold) on the Zacks Rank, with a VGM Score of A.
It also boasts a Value Style Score of B thanks to attractive valuation metrics like a forward P/E ratio of 18.54; value investors should take notice.
Six analysts revised their earnings estimate upwards in the last 60 days for fiscal 2026. The Zacks Consensus Estimate has increased $0.11 to $4.32 per share. BUD boasts an average earnings surprise of +4.6%.
With a solid Zacks Rank and top-tier Value and VGM Style Scores, BUD should be on investors' short list.
