Track market-moving stories before they get noisy

Imugene Ltd (ASX:IMU, OTC:IUGNF, FRA:ILA) earlier this week highlighted encouraging clinical progress for its Azer-Cel program after presenting new data at the American Society of Clinical Oncology (ASCO) conference in Chicago, one of the world's largest oncology events.

Managing director and CEO Leslie Chong said the company was selected to deliver an oral presentation from among more than 8,500 submissions received by the conference. According to Chong, attendance at the session was strong, with hundreds of participants present and standing-room-only conditions during the presentation.

The data focused on Imugene's cohort two study, which is evaluating Azer-Cel in patients with blood cancers who have not previously received approved CAR-T therapies. Chong reported that responses had been observed across several niche indications, including chronic lymphocytic leukemia (CLL), marginal zone lymphoma and Waldenström macroglobulinemia.

Importantly, Chong said some patients had maintained responses for more than six to seven months. One patient with CLL progressed from a partial response to a complete response after approximately five months, an outcome she noted can be difficult to achieve in that disease setting.

The level of engagement from oncologists, investors and pharmaceutical company representatives suggested growing interest in the program. Chong reported that the presentation generated substantial audience interaction and questions, indicating close attention to the study's findings.

Looking ahead, a key catalyst for Imugene will be continued patient enrolment and follow-up within the CAR-T naïve cohort. Additional durability data could further strengthen the clinical profile of Azer-Cel as more patients remain on study.

Another important catalyst is the company's BTK inhibitor combination program. Chong noted that BTK inhibitors serve a market worth approximately $12 billion annually. The study is investigating whether concurrent treatment with Azer-Cel can improve outcomes and potentially extend the effectiveness of existing therapies.

Chong said the company was "quite excited about the data" and highlighted the enthusiasm of investigators involved in the trial, including Dr Gupta, who presented the results at ASCO.

The conference also provided exposure to major pharmaceutical companies, an audience that could become increasingly relevant as clinical development progresses. While Chong said partnerships are an aspiration for many biotechnology companies, she emphasised the broader objective of delivering therapies capable of improving and extending patients' lives.

With ongoing enrolment, additional clinical updates and progress in combination studies, Imugene appears positioned to generate further news flow as development of Azer-Cel continues.

Key highlights Imugene secured an oral presentation slot at ASCO from among more than 8,500 submissions. Hundreds attended the Azer-Cel presentation, with standing-room-only participation. The company received strong engagement and a high volume of audience questions. Data presented came from the CAR-T naïve cohort in blood cancer patients. Responses were observed across multiple lymphoma and leukaemia indications. Some patients maintained responses beyond six to seven months. One CLL patient progressed from a partial response to a complete response. Imugene continues patient enrolment and follow-up in the ongoing study. The company has commenced treatment in a BTK inhibitor combination study. Management sees potential for both standalone and combination use of Azer-Cel. Pharmaceutical companies attending ASCO showed interest in emerging oncology therapies. Leslie Chong emphasised the company's mission to improve and extend patients' lives.

Proactive: Welcome back to Proactive Investors. I'm your host, Kerry Stevenson. I've asked Leslie Chong to join us again. The last time we spoke, Leslie was preparing to attend the American Society of Clinical Oncology (ASCO) conference in the US. More than 40,000 people attend the event and over 8,500 submissions are made. Imugene was selected to present. Leslie, you're still in Chicago. This is quite an achievement for Imugene. Can you explain what happened?

Leslie Chong: Around 40,000 people attend ASCO. We had hundreds of people attend our presentation. Many companies submit data but only a small number are selected for oral presentations. We were able to showcase Azer-Cel from Imugene, and attendance was so strong that some people had to stand because there were not enough seats. We also received the most questions at the end of the session, which tells me people were paying close attention to our study.

Proactive: What was it that generated so much interest?

Leslie Chong: We presented data from cohort two, our CAR-T naïve niche. These are patients with blood cancers who have not previously received approved CAR-T therapies. The basket study includes diseases such as chronic lymphocytic leukemia, marginal zone lymphoma and Waldenström macroglobulinemia. We are seeing responses across multiple indications. In CLL and marginal zone lymphoma in particular, patients are not only responding but maintaining those responses for six to seven months and beyond. One CLL patient moved from a partial response to a complete response after about five months, which is significant because complete responses are difficult to achieve in this disease.

Proactive: What are the next steps?

Leslie Chong: We will continue following patients and enrolling more participants into the niche indication cohort. We have also announced treatment of the first patient in our BTK inhibitor combination study. BTK inhibitors represent a market worth around $12 billion. If combining Azer-Cel with these therapies can improve outcomes and prolong treatment effectiveness, it could be very meaningful. We are excited about the data, and so are our investigators, including Dr Gupta, who presented the results.

Proactive: What exactly is an investigator?

Leslie Chong: Investigators are independent haematology-oncology specialists who conduct clinical trials on our behalf. They are world-leading oncologists who treat patients using our therapy and scientifically evaluate the asset throughout the study.

Proactive: ASCO attracts major pharmaceutical companies. Is partnering a potential strategy?

Leslie Chong: Partnerships are a goal for many emerging biotech companies. One reason I believe Azer-Cel is attractive is that it has the potential to combine with blockbuster medicines while also becoming a significant product in its own right. There is interest in innovative medicines, and collaborations can help bring treatments to patients more effectively. Whether independently or in combination, our goal is to improve and extend patients' lives.

Proactive: Helping patients is clearly a major motivation for you.

Leslie Chong: It is. Cancer has affected many families, including my own. My father passed away from gastric cancer and my mother is a lung cancer survivor. If we can meaningfully extend lives with Azer-Cel, either alone or in combination therapies, that makes the effort worthwhile. That's what ASCO is all about and why it's so energising to be part of this community.

Proactive: Thank you for joining us. We look forward to another update when you return to Australia.

Leslie Chong: Thank you.

Stocks are set for a lackluster open Friday, after a stronger-than-expected jobs report for May sent bond yields rising and pressured a weakening tech sector. Nonfarm payrolls increased by 172,000 last month, above the 80,000 estimates. At last look, the 10-year Treasury yield cleared 4.5%, as interest-rate hike expectations grew.

Futures on the S&P 500 Index (SPX) are modestly lower, while Dow Jones Industrial Average Index (DJIA) futures have pared a triple-digit gain. Nasdaq-100 Index (NDX) futures are pointed sharply lower, with chip stocks under pressure once more. 

Continue reading for more on today's market, including:

Plus, where the chip selloff spilled, and two retailers brushing off lackluster reports.

5 Things You Need to Know Today The Cboe Options Exchange saw more than 2.8 million call contracts and 1.2 million put contracts traded on Wednesday. The single-session equity put/call ratio fell to 0.77, while the 21-day moving average fell at 0.56.  The chip selloff spilled over into the memory sector, with Micron Technology (NASDAQ:MU) last seen down 3% premarket. Micron stock is stepping further away from Wednesday's all-time high of $1,089.29. Shares of lululemon athletica Inc (NASDAQ:LULU) are plummeting 11.4% before the bell, after the retailer slashed its full-year outlook, overshadowing a top- and bottom-line beat for the first quarter. The company also made a wider-than-expected cut to its earnings guidance. LULU has been struggling on the charts, already having shed 62.7% over the past 12 months. Chipotle Mexican Grill (NYSE:CMG) shares are 1.3% higher in electronic trading, after J.P. Morgan Securities upgraded the chain to "overweight" from "neutral" and hiked its price target to $35 from $32. The burrito maker has shed 23% for the year, though today's move could push the stock away from yesterday's three-year low. Investors will be eyeing key jobs data later this week. 

Asian Markets Suffer Tech Sector Setback Asian markets finished firmly lower on Friday as investors continued to monitor U.S.-Iran tensions. The South Korean Kospi slid 5.5% as tech stocks plunged, taking a cue from their U.S. counterparts. Plus, South Korea's labor minister also called on major tech firms to share more of their booming profits with workers and suppliers, warning that the AI-fueled surge in chip-sector earnings could exacerbate wealth disparities. Japan’s Nikkei and Hang Kong’s Hang Seng fell 1.3% and 1.2%, respectively, while China’s Shanghai Composite shed 0.7%.

European markets are brushing off the chip selloff. The French CAC 40 is leading the gains with a 0.6% rise, while London’s FTSE 100 is up 0.5%, and the German DAX adds 0.2%. The pound is moving higher, set for its third-straight weekly gain against the U.S. dollar. Meanwhile, U.K. Housing prices fell an unexpected 0.1% in May.

Key Takeaways LULU Q1 EPS of $1.69 beat estimates of $1.67; revenues of $2.47B beat estimates of $2.43B.LULU international revenues rose 22% y/y, while Americas revenues fell 3% and comps dropped 5%.LULU cut its FY26 outlook to $11-$11.15B revenues and $10.95-$11.15 EPS as margin pressure builds. lululemon athletica inc. (LULU - Free Report) delivered first-quarter fiscal 2026 results, wherein revenues and earnings per share (EPS) surpassed the Zacks Consensus Estimate. The company delivered year-over-year top-line growth, supported by strength in its international business. However, the bottom line declined from the prior year, reflecting margin pressure from higher markdowns, tariff-related costs and elevated SG&A expenses.

lululemon’s fiscal first-quarter EPS of $1.69 declined 35% year over year but surpassed the Zacks Consensus Estimate of $1.67 by 1.2%.

The Vancouver, Canada-based company’s quarterly revenues increased 4% from the year-ago period to $2.47 billion and 2% on a constant-dollar basis. Revenues beat the Zacks Consensus Estimate of $2.43 billion by 1.6%. The quarter’s top-line growth was driven by strong international demand, even as comparable sales (comps) declined 2% on a constant-dollar basis and North America remained under pressure.

Total comps rose 1% year over year and declined 2% on a constant-dollar basis. Comps in the Americas dipped 5% on a reported basis and 6% on a constant-dollar basis. Internationally, comps increased 13% on a reported basis and 18% on a constant-dollar basis. Our model predicted comps growth of 0.3% for the fiscal first quarter.

Shares of the company declined 11.5% in the after-hours trading session on June 4, 2026, following the soft earnings performance in first-quarter fiscal 2026 and a bleak guidance. The Zacks Rank #3 (Hold) company has lost 26.6% in the past three months compared with the Textile - Apparel industry’s 9% decline.

Image Source: Zacks Investment Research

LULU’s Regional Mix Shifts Toward Overseas GrowthInternational markets did most of the heavy lifting, with revenues increasing 22% y/y (up 16% in constant dollars). China Mainland net revenues rose 30% year over year to $478.4 million (23% in constant dollars), while the Rest of World segment generated $372.0 million, up 13% (9% in constant dollars). Comps momentum also skewed overseas, with China Mainland up 20% (13% in constant dollars) and Rest of World up 5% (1% in constant dollars).

The Americas business remained the key drag. Net revenues in the region declined 3% year over year (down 4% in constant dollars). Within the Americas segment, revenues declined 3% year over year in Canada (down 6% in constant dollars) and 4% in the United States, on both reported and constant-dollar basis.

This underscores that the company’s growth engine is currently being powered more by market expansion outside North America than by broad-based demand improvement at home.

lululemon’s Channels & Categories Show Mixed DemandBy channel, store-led growth returned, supported by ongoing fleet expansion and optimizations. Store channel sales increased 3% year over year. Digital also contributed, with e-commerce revenues rising 4% and representing $1 billion, or 40% of quarterly sales.

Category trends were similarly mixed: men’s revenues increased 7% year over year and women’s rose 4%, while accessories and other revenues declined 1%. The split suggests demand remained healthiest in core apparel, particularly men’s, while discretionary add-on categories lagged.

LULU’s Tariffs & Markdowns Pressure Gross MarginProfitability weakened sharply as higher costs weighed on product economics. The gross margin declined 410 basis points (bps) year over year to 54.2%, driven by a 330-bps product margin pressure and 140 bps of fixed-cost deleverage. We expected the gross margin to contract 380 bps year over year to 54.5% for the fiscal first quarter.

Management attributed the product margin decline primarily to tariffs and markdowns. Tariffs reduced the gross margin by 280 bps in the quarter, partially offset by 100 bps of benefit tied to enterprise efficiency initiatives. Markdowns increased 40 bps, while higher occupancy and depreciation costs contributed to the fixed-cost deleverage. Favorable foreign exchange provided a 60-bps tailwind but was not enough to offset the broader cost headwinds.

lululemon’s Costs Rise on Activations & Proxy ContestOperating expenses also moved higher as the company leaned into brand activity and reintroduced costs that were reduced last year. Selling, general and administrative (SG&A) expenses rose 12.4% to $1.1 billion. SG&A expenses, as a percentage of net revenues, of 42.9%, reflected 310 bps of year-over-year deleverage. Drivers included higher employee costs, the timing of brand activations and expenses tied to the proxy contest.

Our model predicted SG&A expenses to rise 11.1% year over year for the fiscal first quarter, with a 330-bps increase in the SG&A expense rate to 43.1%.

The combination of gross margin compression and SG&A deleverage made operating income fall to $276.9 million, with the operating margin contracting 730 bps to 11.2% from 18.5% in the year-ago quarter.

Our model predicted a 37% year-over-year decline in adjusted operating income to $276.5 million. We estimated the operating margin to decline 710 bps to 11.4%.

Snapshot of LULU’s Store PlansIn first-quarter fiscal 2025, lululemon opened 5 net new stores, including 11 store openings and six closures. The company also completed six optimizations. As of May 3, 2026, it operated 816 stores.

In the second quarter of fiscal 2026, the company expects to open 13 net new company-operated stores and complete 13 store optimizations. For fiscal 2026, lululemon expects to be closer to the low-end of the 40-45 net new company-operated stores target and complete 35 optimizations. Store openings in fiscal 2026 are expected to include 10-15 in North America, including about eight locations in Mexico.

Additionally, the company expects 25-30 store openings in the international markets in fiscal 2026, with the majority planned for China. LULU expects overall square footage growth in the low-double digits for fiscal 2026.

lululemon’s Other Financial DetailsLULU ended first-quarter fiscal 2026 with $1.5 billion in cash and cash equivalents. Inventory was $1.7 billion, up 2% on a dollar basis, while unit inventory decreased about 4%, reflecting the impacts of higher tariff rates and foreign exchange. The company also repurchased 2.2 million shares for $358.3 million in the fiscal first quarter.

For fiscal 2026, the company expects dollar inventory to increase in the low to mid-single digits and inventory per unit to be down slightly. For fiscal 2026, lululemon expects capital expenditure of $700-$720 million.

As of May 3, 2026, the company had $1 billion remaining under its share repurchase program. LULU expects the repurchase levels in fiscal 2026 to be broadly in line with fiscal 2025.

LULU’s Outlook Reflects Softer Trends in Q2In the earnings call, management cited a recent moderation in sales trends tied to spikes of negative brand commentary and product launches that have not met expectations, and noted it is moving with urgency to adjust product and increase marketing and community activations.

Management’s near-term outlook points to a tougher demand and margin setup in the fiscal second quarter. LULU expects net revenues of $2.45-$2.475 billion, implying a 2-3% decline from the prior-year period. The company guides earnings to decline to $1.76-$1.81 per share from the $3.10 reported in the year-ago quarter.

By region, management expects North America revenues to decline in the low double digits in the fiscal second quarter, with the United States also down in the low double digits. China Mainland revenues are expected to increase in the mid to high-teens, while Rest of World revenues are projected to rise in the high single to low double digits.

LULU projected the gross margin to contract 410 bps year over year, led by higher tariff costs, and ongoing investments in store openings, optimizations and distribution network. Tariffs expected to be a 150-bps headwind, with offsets of 100 bps. Meanwhile, markdowns are likely to rise 50 bps due to additional seasonal clearance. The company also anticipates SG&A deleverage of 500 bps in the fiscal second quarter, reflecting lower sales, proxy-related costs, increased marketing and higher store labor expenses.

LULU expects the second-quarter fiscal 2026 operating margin to contract 910 bps year over year to 11.6%. LULU estimates an effective tax rate of 30% for the fiscal second quarter.

lululemon’s Targets for FY26For fiscal 2026, LULU lowered its outlook and expects revenues of $11-$11.15 billion, suggesting flat to a 1% year-over-year fall. Earlier, the company expected net revenues of $11.35-$11.5 billion. lululemon projects earnings of $10.95-$11.15 per share, suggesting a dip from the $13.26 reported in fiscal 2025. Earlier, the company projected an EPS of $12.10-$12.30.

Regionally, management expects North America revenues to decline in the high single digits, with the United States slightly weaker and Canada relatively better. China Mainland revenues are projected to rise 20%, while Rest of World revenues are expected to increase in the mid-teens.

LULU forecasts the gross margin to decline 90 bps year over year, driven mainly by fixed-cost deleverage and ongoing investments in new store openings, optimizations and the distribution center network. Markdowns are expected to be flat to slightly improved for the year, while tariffs are expected to have a gross impact of 30 bps that the company expects to offset almost entirely.

The updated outlook assumes a 10% incremental tariff rate in the fiscal second quarter (down from a prior assumption of about 20%), while maintaining a 20% incremental tariff rate assumption for the back half of fiscal 2026. The guidance also assumes no recovery of tariffs paid under IEEPA.

For SG&A, management expects 290 bps of deleverage versus fiscal 2025, reflecting incentive compensation, store labor hours and continued investments to support growth, especially market expansion, improved omni capabilities and increased brand awareness. The outlook also incorporates costs layered back after reductions last year, one-time proxy contest expenses and higher marketing spending to rebuild brand momentum.

Overall, lululemon expects the fiscal 2026 operating margin to decline 380 bps from last year and projects an effective tax rate of 30% (versus registered 29.5% in fiscal 2025).

Solid Picks in LULU’s Broader IndustryWe have highlighted three better-ranked stocks from the same industry, namely Columbia Sportswear Company (COLM - Free Report) , Vince Holding Corp. (VNCE - Free Report) and Ralph Lauren Corporation (RL - Free Report) .

Columbia Sportswear engages in the sourcing, marketing and distribution of outdoor and active lifestyle apparel, footwear, accessories and equipment in the United States and internationally. COLM sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Columbia Sportswear’s 2026 sales and EPS indicates growth of 2.6% and 4.6%, respectively, from the year-ago period’s reported figures. Columbia Sportswear has a trailing four-quarter earnings surprise of 44.1%, on average.

Vince Holding operates as a retail company in the United States and internationally. VNCE has a Zacks Rank #2 (Buy) at present.

The Zacks Consensus Estimate for VNCE’s fiscal 2026 sales and earnings indicates growth of 4.5% and 25%, respectively, from the year-ago period’s reported figures. VNCE has a trailing four-quarter earnings surprise of 647.2%, on average.

Ralph Lauren is a major designer, marketer and distributor of premium lifestyle products in North America, Europe, Asia and internationally. RL currently carries a Zacks Rank #2.

The Zacks Consensus Estimate for Ralph Lauren’s fiscal 2027 sales and earnings indicates growth of 5.9% and 9.8%, respectively, from the year-ago period’s reported figures. RL has a trailing four-quarter earnings surprise of 9.1%, on average.

Key Takeaways Lululemon shares tumbled Friday after the athleisure apparel maker lowered its full-year outlook. The company saw sales weaken toward the end of the first quarter and into the current quarter amid worsening sentiment around its brand. Get personalized, AI-powered answers built on 27+ years of trusted expertise.

A weaker outlook has Lululemon’s stock plunging to its lowest level in years.

Shares of Lululemon Athletica (LULU) were down nearly 8% to $115 in recent trading, their lowest price since May of 2018, after the apparel maker lowered its full-year forecast. Lululemon said it now expects $11 billion to $11.15 billion in sales for the year, which would be flat to a 1% decline from last year, down from a previous forecast of $11.35 billion to $11.5 billion. Lululemon's second-quarter outlook of $2.45 billion to $2.48 billion in sales and earnings per share of $1.76 to $1.81 also came in well below what analysts were expecting, per Visible Alpha estimates.

Interim co-CEO Meghan Frank pointed to a drop in sales at the end of the first quarter and start of the second quarter amid "negative commentary in the media and on social channels," and said the company's recent product launches have had mixed performances, per an AlphaSense transcript.

Why This Matters to Investors Friday's stock slump and sliding sales could complicate Lululemon's turnaround effort in the months ahead of a new CEO taking over.

JPMorgan analysts cut their price target for Lululemon's stock to $149 from $173 following the report, citing the weaker outlook and comments about Lululemon's recent product launches. The company posted earnings per share of $1.69 on $2.5 billion in sales in for the first quarter, roughly in line with analysts' estimates.

Lululemon shares have been pressured for more than a year by sales struggles, a sudden CEO departure, and a proxy battle with founder Chip Wilson that was resolved last month. The athleisure company is looking to turn things around when its new CEO, former Nike (NKE) executive Heidi O’Neill, takes over the top job on Sept. 8.

With Friday's slump, Lululemon shares are down about 45% since the start of the year, and almost 60% in the last 12 months.

Lululemon Athletica shares fell more than 8% on Friday after the athleisure wear maker cut its annual profit forecast, fanning worries over the pace of its turnaround and shifting focus to the challenges awaiting the incoming CEO.

The selloff highlights growing investor unease over the once high-flying yoga wear brand, following a proxy battle with founder Chip Wilson and a series of product missteps that have dented its image, ahead of former Nike executive Heidi O’Neill taking over in September.

“Brand momentum is fading, share losses are building, and sales per foot are deteriorating …. The damage under the prior CEO is significant and long lasting,” Jefferies analysts said, adding that the company needs a full strategic reset under the new CEO.

The selloff highlights growing investor unease over the once high-flying yoga wear brand. REUTERS Brand pressure, lackluster innovation In the quarter, Lululemon attributed the sales weakness in part to a spike in “negative commentary” across media and social platforms, linked to a months-long proxy fight in which founder Wilson criticized the company’s leadership.

It also blamed product launches that failed to resonate with its core affluent female shopper.

Wilson, who is one of the company’s biggest independent shareholders, had accused the brand of having lost its “cool” factor, with leaders keen to “replicate mass-market, lower quality athletic retailers.”

The negative sentiment has been compounded by stumbles in product innovation, including complaints that its $108 “Get Low” leggings were see-through, alongside earlier issues with fit and design in recent launches.

The Vancouver-based company, whose leggings cost up to $178, is in the early stages of a turnaround, ramping up discounting on older inventory and revamping marketing as tariffs squeeze margins.

Valuation slides Its shares fell to an over seven-year low of $109.36 before closing at $114.23, adding to a bruising 12-month stretch in which the stock has lost nearly two-thirds of their worth.

Former Nike executive Heidi O’Neill taking over in September after a series of missteps. Hardy Wilson for Lululemon The company forecast a drop in second-quarter sales for the first time since the pandemic, prompting at least nine brokerages to cut their price target on the stock.

The median PT has fallen to $149 from $205 three months ago.

Growth has also been stifled by newer, fast-growing players in the space such as Alo, Vuori and Skims in the US, even as China remains a bright spot for Lululemon.

For the full year, profit is now expected to slide up to 17% following a 9% drop in 2025 and operating margin is seen contracting 380 basis points to 16.1%, the lowest since 2006, according to brokerage William Blair.

Founder Chip Wilson had criticized the company’s direction but recently ended his proxy fight. REUTERS Against this backdrop, attention is turning to incoming CEO O’Neill, with investors closely watching whether she can revive product innovation and restore momentum in the US.

The company’s valuation multiple has compressed to around 10 times forward earnings, well below 22.85 for Nike and 15.10 for Adidas, according to LSEG data.

“Now that the CEO transition path is set, fundamentals come back into view and they are not good,” said BNP Paribas analyst Laurent Vasilescu.

Did lululemon athletica inc. Insiders Breach their Fiduciary Duties to Shareholders? PR Newswire NEW YORK, June

Lululemon (LULU 2.06%) reported quarterly financial results that disappointed the stock market and investors.

*Stock prices used were the afternoon prices of June 3, 2026. The video was published on June 5, 2026.

Parkev Tatevosian, CFA has positions in Lululemon Athletica Inc. The Motley Fool has positions in and recommends Lululemon Athletica Inc. The Motley Fool has a disclosure policy. Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.

A week ago, I predicted that Lululemon Athletica (LULU 2.06%) stock would take a beating if the company reported weak earnings or lowered its 2026 guidance. And unfortunately, both of those things happened when the company posted its fiscal 2026 first-quarter report on June 4.

Now the company is trading at an eight-year low, having fallen more than 12% post-earnings. Where does the athleisure company go from here?

Lululemon’s earnings by the numbersFirst, let’s see what happened. For the quarter ending May 3, Lululemon posted revenue of $2.47 billion, up from $2.37 billion a year ago. However, the cost of goods sold jumped 14% year over year, pushing the company’s gross profit down by more than 4%. On top of that, Lululemon’s selling and general expenses rose 12.4%, to $1.05 billion. All that led to the company’s net income falling 38% to $195 million for the quarter. Earnings per share were $1.69, versus $2.60 in the same period a year ago.

While Lululemon is growing in popularity in China, its biggest problem lies in domestic sales, as revenue and comparable sales in the U.S. were down significantly from last year.

Net RevenueChangeForeign ExchangeChange in Constant DollarsUnited States(4%)-%(4%)Canada(3%)(3%)(6%)Americas(3%)(1%)(4%)China Mainland30%(7%)23%Rest of World13%(4%)16%Total International22%(6%)16%Total4%(2%)2%Source: Lululemon

Comparable SalesChangeForeign ExchangeChange in Constant DollarsAmericas(5%)(1%)(6%)China Mainland20%(7%)13%Rest of World13%(5%)1%Total1%(3%)(2%)Source: Lululemon

Management also cut full-year guidance, now projecting revenue of $11 billion to $11.15 billion, a decline of up to 1% from a year ago. Earnings per share are expected to be in the range of $10.95 to $11.15.

Interim co-CEO Meghan Frank acknowledged “a few headwinds and a moderating sales trend” and placed the blame on poor product launches and “spikes of negative commentary in the media and on social channels with regard to our brand, which had an impact on traffic and overall top-line performance.”

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A proxy fight takes a toll on earningsFrank didn’t mention him by name, but at least part of that negative commentary stemmed from a very public proxy fight with founder Chip Wilson, which was settled just days before the earnings report. Wilson, who left the company in 2013 and continues to hold nearly 9% of the company’s stock, has been an outspoken critic, accusing the company of squandering "billions of dollars in brand power."

Wilson had also criticized Lululemon’s newly hired CEO, former Nike executive Heidi O’Neill. O’Neill won’t start work at Lululemon until Sept. 8, so the company still has several months of interim leadership before O’Neill takes over.

Image source: The Motley Fool.

However, Lululemon won’t have to worry about Wilson being a public distraction. The founder agreed to an 18-month non-disparagement clause as part of its settlement, which also saw Lululemon agree to add two of Wilson’s candidates to the board of directors.

Where does Lululemon go from here?The company faces significant challenges, as tariffs and higher fuel and other expenses pressure margins. Lululemon has applied for a refund of the tariffs following the Supreme Court’s ruling that they were illegal. But it’s unclear when those refunds will be processed.

Lululemon’s premium line of yoga and training pants, shorts, and tops also leaves little room for the company to reduce prices to boost sales. The company plans to reduce in-store offerings by 15% to better highlight newer products and improve its marketing and community engagement.

However, some analysts are skeptical that it will pay off in the short term. “We do not believe the root of the challenges has been fully diagnosed and see the company as being in a holding pattern as we await the arrival of incoming CEO Heidi O’Neill in September,” BTIG analyst Janine Stichter wrote in a note to clients. Another analyst, BNP Paribas Securities, downgraded the stock to “Underperform” and cut its price target from $179 to $88. Stifel analyst Peter McGoldrick cut his price target from $176 to $134, although he maintained his “Hold” rating.

Now down 43% this year and trading at its lowest level since 2018, Lululemon faces a long road back and has substantial hurdles to clear. This is a stock to avoid for now.

Lululemon (LULU - Free Report) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.

Over the past month, shares of this athletic apparel maker have returned -3%, compared to the Zacks S&P 500 composite's no change. During this period, the Zacks Textile - Apparel industry, which Lululemon falls in, has gained 3.9%. The key question now is: What could be the stock's future direction?

While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.

Revisions to Earnings EstimatesRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.

Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.

Lululemon is expected to post earnings of $2.14 per share for the current quarter, representing a year-over-year change of -31%. Over the last 30 days, the Zacks Consensus Estimate has changed -34.8%.

The consensus earnings estimate of $11.57 for the current fiscal year indicates a year-over-year change of -12.8%. This estimate has changed -7.1% over the last 30 days.

For the next fiscal year, the consensus earnings estimate of $12.43 indicates a change of +7.4% from what Lululemon is expected to report a year ago. Over the past month, the estimate has changed -7.3%.

With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #4 (Sell) for Lululemon.

The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:

12 Month EPS

Revenue Growth ForecastWhile earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth.

In the case of Lululemon, the consensus sales estimate of $2.47 billion for the current quarter points to a year-over-year change of -2.4%. The $11.15 billion and $11.68 billion estimates for the current and next fiscal years indicate changes of +0.4% and +4.7%, respectively.

Last Reported Results and Surprise HistoryLululemon reported revenues of $2.47 billion in the last reported quarter, representing a year-over-year change of +4.3%. EPS of $1.69 for the same period compares with $2.6 a year ago.

Compared to the Zacks Consensus Estimate of $2.43 billion, the reported revenues represent a surprise of +1.59%. The EPS surprise was +1.2%.

The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates three times over this period.

ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.

While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.

The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.

Lululemon is graded B on this front, indicating that it is trading at a discount to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.

Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Lululemon. However, its Zacks Rank #4 does suggest that it may underperform the broader market in the near term.

Shares of Knife River Corporation (NYSE: KNF - Get Free Report) have earned an average recommendation of "Moderate Buy" from the ten brokerages that are currently covering the stock, MarketBeat reports. One investment analyst has rated the stock with a sell recommendation, three have given a hold recommendation and six have given a buy recommendation to

Congress Asset Management Co. lessened its holdings in Knife River Corporation (NYSE: KNF) by 8.6% during the fourth quarter, according to its most recent filing with the Securities and Exchange Commission. The institutional investor owned 700,780 shares of the company's stock after selling 65,623 shares during the quarter. Congress Asset Management Co. owned

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BISMARCK, N.D.--(BUSINESS WIRE)--Knife River Corporation (NYSE: KNF), an aggregates-based, vertically integrated construction materials and contracting services company, will host its first quarter 2026 earnings conference call at 11 a.m. EDT Tuesday, May 5, 2026. Financial results for the quarter will be released that morning before the NYSE market opens.

A live webcast of the call, along with presentation slides, will be available in the Investors section of the Knife River website at investors.kniferiver.com or at https://events.q4inc.com/attendee/317415196.

To participate in the live conference call:

After the conclusion of the call, an on-demand replay of the webcast will be made available.

About Knife River

Knife River Corporation, a member of the S&P MidCap 400 index, mines aggregates and markets crushed stone, sand, gravel and related construction materials, including ready-mix concrete, asphalt, liquid asphalt and other value-added products. Knife River also performs vertically integrated contracting services, specializing in publicly funded DOT projects and private projects across the industrial, commercial and residential space. For more information about the company, visit www.kniferiver.com.

More News From Knife River Corporation

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For those looking to find strong Construction stocks, it is prudent to search for companies in the group that are outperforming their peers. Emcor Group (EME - Free Report) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? By taking a look at the stock's year-to-date performance in comparison to its Construction peers, we might be able to answer that question.

Emcor Group is one of 90 companies in the Construction group. The Construction group currently sits at #16 within the Zacks Sector Rank. The Zacks Sector Rank gauges the strength of our 16 individual sector groups by measuring the average Zacks Rank of the individual stocks within the groups.

The Zacks Rank is a proven system that emphasizes earnings estimates and estimate revisions, highlighting a variety of stocks that are displaying the right characteristics to beat the market over the next one to three months. Emcor Group is currently sporting a Zacks Rank of #1 (Strong Buy).

Over the past 90 days, the Zacks Consensus Estimate for EME's full-year earnings has moved 3% higher. This means that analyst sentiment is stronger and the stock's earnings outlook is improving.

According to our latest data, EME has moved about 44.7% on a year-to-date basis. At the same time, Construction stocks have gained an average of 14.4%. This means that Emcor Group is performing better than its sector in terms of year-to-date returns.

Another stock in the Construction sector, Knife River (KNF - Free Report) , has outperformed the sector so far this year. The stock's year-to-date return is 26.4%.

For Knife River, the consensus EPS estimate for the current year has increased 1% over the past three months. The stock currently has a Zacks Rank #2 (Buy).

Looking more specifically, Emcor Group belongs to the Building Products - Heavy Construction industry, which includes 8 individual stocks and currently sits at #40 in the Zacks Industry Rank. On average, this group has gained an average of 45.3% so far this year, meaning that EME is slightly underperforming its industry in terms of year-to-date returns.

On the other hand, Knife River belongs to the Building Products - Miscellaneous industry. This 33-stock industry is currently ranked #167. The industry has moved +7.2% year to date.

Investors interested in the Construction sector may want to keep a close eye on Emcor Group and Knife River as they attempt to continue their solid performance.

BISMARCK, N.D.--(BUSINESS WIRE)--Knife River Corporation (NYSE: KNF), an aggregates-based, vertically integrated construction materials and contracting services company, today announced financial results for the first quarter ended March 31, 2026.

Three Months Ended March 31,

(In millions, except per share)

2026

2025

% Change

Revenue

$

410.1

$

353.5

16

%

Net loss

$

(79.2

)

$

(68.7

)

(15

)%

Net loss margin

(19.3

)%

(19.4

)%

Adjusted EBITDA

$

(31.8

)

$

(38.0

)

16

%

Adjusted EBITDA margin

(7.8

)%

(10.7

)%

Net loss per share

$

(1.40

)

$

(1.21

)

(16

)%

Note: Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. For more information on all non-GAAP measures and a reconciliation to the nearest GAAP measure, see the section entitled "Non-GAAP Financial Measures."

“We had a good start to 2026, improving year-over-year revenue by 16%, adjusted EBITDA by 16% and adjusted EBITDA margin by 290 basis points,” said Knife River President and CEO Brian Gray. “We realized double-digit volume increases across our product lines and we reduced our per-unit costs, which drove gross profit improvements for aggregates, ready-mix and asphalt. We also generated more contracting services revenue than the same time last year, taking advantage of better weather and more activity across our segments.

“Knife River states are enjoying some of the fastest population growth in the nation, and we are growing our business along with them,” Gray said. “We completed three acquisitions during the quarter: Morgan Asphalt in Utah; and Sparrow Enterprises and Donaldson Brothers Ready-Mix in Montana. These aggregates-based, vertically integrated additions to our Mountain Region align with our strategy of expanding into mid-sized, higher-growth markets.

“While the first quarter is seasonally the lightest activity period of the year, we enter the 2026 construction season with momentum, including record first quarter backlog of $1.2 billion,” Gray said. “With strong underlying demand, our recent acquisitions, and continued focus on price optimization and cost controls — including mitigating energy costs with our established operational practices — we expect to deliver profitable growth for our shareholders this year and beyond.”

Knife River expects full-year 2026 financial results in the ranges noted in the following table.

2026 Financial Guidance

Low

High

(In millions)

Revenue

$

3,300.0

$

3,500.0

Adjusted EBITDA

$

520.0

$

560.0

The company further expects:

Aggregates volumes and pricing to increase mid-single digits. Ready-mix volumes to increase mid-teens. Asphalt volumes to increase mid-single digits. Financial results for Energy Services expected to be broadly in line with full-year 2025 results. Depreciation, depletion and amortization to increase mid-single digits. The guidance ranges are based on normal weather, economic and operating conditions, and do not include the expected impact of future acquisitions.

REPORTING SEGMENT PERFORMANCE

West

Alaska, California, Hawaii, Oregon, Washington

Three Months Ended

March 31,

2026

2025

% Change

(In millions)

Revenue

$

211.8

$

208.3

2

%

EBITDA

$

22.2

$

24.9

(11

)%

EBITDA margin

10.5

%

12.0

%

First quarter revenue increased 2% year-over-year, driven primarily by higher private market demand and project timing, which resulted in increased material volumes. EBITDA decreased 11% compared to the prior year, primarily due to the absence of a one-time gain of $3.5 million related to an acquisition recognized as a bargain purchase in the first quarter of 2025, as well as volume declines in Hawaii following significant flooding in the state.

Mountain

Idaho, Montana, Utah, Wyoming

Three Months Ended

March 31,

2026

2025

% Change

(In millions)

Revenue

$

81.2

$

66.0

23

%

EBITDA

$

(8.2

)

$

(16.3

)

49

%

EBITDA margin

(10.1

)%

(24.6

)%

First quarter revenue increased 23% from the prior year, largely driven by increased ready-mix, aggregate and asphalt volumes and pricing. In addition, contracting services increased due to favorable weather that enabled execution on record backlog, along with contributions from acquisitions during the first quarter of 2026. EBITDA improved 49%, primarily driven by more aggregate and ready-mix volume, pricing and lower cost per unit.

Central

Iowa, Minnesota, North Dakota, South Dakota, Texas

Three Months Ended

March 31,

2026

2025

% Change

(In millions)

Revenue

$

101.2

$

67.9

49

%

EBITDA

$

(26.8

)

$

(24.3

)

(10

)%

EBITDA margin

(26.5

)%

(35.8

)%

First quarter revenue increased 49% from the prior year, primarily driven by contributions from acquisitions completed in 2025, including more than doubling ready-mix volumes in Texas. EBITDA decreased 10%, with a majority of the decline being attributed to the two additional months of seasonal losses from the March 2025 purchase of Strata, as anticipated, partially offset by increased ready-mix sales volumes.

Energy Services

California, Iowa, Nebraska, Oregon, South Dakota, Texas, Washington, Wyoming

Three Months Ended

March 31,

2026

2025

% Change

(In millions)

Revenue

$

20.4

$

13.9

47

%

EBITDA

$

(4.6

)

$

(7.8

)

41

%

EBITDA margin

(22.6

)%

(56.0

)%

First quarter revenue increased 47% from the prior year, driven by higher sales volumes primarily related to favorable weather. EBITDA improved $3.2 million, largely because of the increased sales volumes, as well as lower railcar maintenance expenses compared to prior year.

The company is committed to disciplined capital allocation, including reinvesting to maintain fixed assets, improve operations and grow the business.

The company currently estimates total 2026 capital expenditures for maintenance and improvement to be between 5% and 7% of revenue. For the three months ending March 31, 2026, the company spent $42.3 million, largely on the replacement of construction equipment and plant improvements.

Additionally, for the three months ended March 31, 2026, the company spent $209.2 million on growth initiatives, which was comprised of $174.2 million on acquisitions and $35.0 million on aggregate expansions and greenfield projects. For the remainder of 2026, the company expects to spend $101.4 million on organic growth projects. Capital expenditures for future acquisitions and new growth opportunities would be incremental to the outlined capital program. It is anticipated that capital expenditures for the remainder of 2026 will be funded by various sources, including cash from operations and debt.

As of March 31, 2026, Knife River had $13.4 million of unrestricted cash and cash equivalents, $1.4 billion of gross debt and $178.2 million of available capacity under its revolving credit facility, net of outstanding letters of credit. Net leverage, defined as the ratio of net debt to trailing-twelve-month Adjusted EBITDA, was 2.9x at March 31, 2026.

Knife River will host a conference call at 11 a.m. EDT on May 5 to discuss first quarter results and conduct a question-and-answer session. The event will be webcast at https://events.q4inc.com/attendee/317415196.

To participate in the live call:

Domestic: 1-800-715-9871 International: 1-646-307-1963 Conference ID: 9769431 Knife River Corporation, a member of the S&P MidCap 400 index, mines aggregates and markets crushed stone, sand, gravel and related construction materials, including ready-mix concrete, asphalt and other value-added products. Knife River also performs vertically integrated contracting services, specializing in publicly funded DOT projects and private projects across the industrial, commercial and residential space. For more information about the company, visit www.kniferiver.com.

Knife River Corporation

Consolidated Statements of Operations

(Unaudited)

Three Months Ended

March 31,

2026

2025

(In millions, except per share amounts)

Revenue:

Construction materials

$

262.3

$

213.4

Contracting services

147.8

140.1

Total revenue

410.1

353.5

Cost of revenue:

Construction materials

272.9

233.8

Contracting services

140.0

129.3

Total cost of revenue

412.9

363.1

Gross loss

(2.8

)

(9.6

)

Selling, general and administrative expenses

83.5

73.1

Operating loss

(86.3

)

(82.7

)

Interest expense

20.7

15.3

Other (expense) income

(0.6

)

4.6

Loss before income taxes

(107.6

)

(93.4

)

Income tax benefit

(28.4

)

(24.7

)

Net loss

$

(79.2

)

$

(68.7

)

Net loss per share:

Basic

$

(1.40

)

$

(1.21

)

Diluted

$

(1.40

)

$

(1.21

)

Weighted average common shares outstanding:

Basic

56.7

56.6

Diluted

56.7

56.6

Knife River Corporation

Consolidated Balance Sheets

(Unaudited)

March 31, 2026

March 31, 2025

December 31, 2025

(In millions, except shares and per share amounts)

Assets

Current assets:

Cash, cash equivalents and restricted cash

$

75.5

$

138.5

$

123.4

Receivables, net

227.3

238.0

278.1

Contract assets

77.2

28.5

77.5

Inventories

480.5

467.1

435.7

Prepayments and other current assets

81.8

74.6

46.2

Total current assets

942.3

946.7

960.9

Noncurrent assets:

Net property, plant and equipment

2,158.4

1,743.5

2,028.9

Goodwill

573.1

449.6

519.7

Other intangible assets, net

38.2

42.0

32.7

Operating lease right-of-use assets

49.6

46.5

52.6

Investments and other

56.3

52.4

55.3

Total noncurrent assets

2,875.6

2,334.0

2,689.2

Total assets

$

3,817.9

$

3,280.7

$

3,650.1

Liabilities and Stockholders' Equity

Current liabilities:

Long-term debt - current portion

$

11.7

$

11.8

$

11.7

Accounts payable

131.4

112.0

145.6

Contract liabilities

30.3

42.0

33.8

Accrued compensation

23.1

19.0

44.3

Current operating lease liabilities

15.6

13.4

15.9

Other taxes payable

14.3

14.2

11.3

Accrued interest

16.2

15.9

7.3

Other accrued liabilities

109.7

93.7

108.1

Total current liabilities

352.3

322.0

378.0

Noncurrent liabilities:

Long-term debt

1,421.6

1,160.4

1,153.8

Deferred income taxes

292.3

221.6

287.9

Noncurrent operating lease liabilities

34.0

33.1

36.7

Other

158.3

136.0

152.8

Total liabilities

2,258.5

1,873.1

2,009.2

Commitments and contingencies

Stockholders' equity:

Common stock, 300,000,000 shares authorized, $0.01 par value, 57,184,991 shares issued and 56,753,855 shares outstanding at March 31, 2026; 57,083,497 shares issued and 56,652,361 shares outstanding at March 31, 2025; 57,095,301 shares issued and 56,664,165 shares outstanding at December 31, 2025

0.6

0.6

0.6

Other paid-in capital

627.1

621.0

629.6

Retained earnings

945.4

798.8

1,024.6

Treasury stock held at cost - 431,136 shares

(3.6

)

(3.6

)

(3.6

)

Accumulated other comprehensive loss

(10.1

)

(9.2

)

(10.3

)

Total stockholders' equity

1,559.4

1,407.6

1,640.9

Total liabilities and stockholders' equity

$

3,817.9

$

3,280.7

$

3,650.1

Knife River Corporation

Consolidated Statements of Cash Flows

(Unaudited)

Three Months Ended

March 31,

2026

2025

(In millions)

Operating activities:

Net loss

$

(79.2

)

$

(68.7

)

Adjustments to reconcile net income to net cash provided by operating activities

51.8

38.2

Changes in current assets and liabilities, net of acquisitions:

Receivables

52.5

41.1

Inventories

(41.1

)

(50.4

)

Other current assets

(33.5

)

(35.5

)

Accounts payable

(5.3

)

(12.8

)

Other current liabilities

(8.5

)

(40.3

)

Pension and postretirement benefit plan contributions

(0.1

)

(0.1

)

Other noncurrent changes

4.8

3.2

Net cash used in operating activities

(58.6

)

(125.3

)

Investing activities:

Capital expenditures

(77.3

)

(75.0

)

Acquisitions, net of cash acquired

(174.2

)

(443.4

)

Net proceeds from sale or disposition of property and other

3.1

17.5

Investments

(2.6

)

(2.7

)

Net cash used in investing activities

(251.0

)

(503.6

)

Financing activities:

Issuance of long-term debt

270.0

500.0

Repayment of long-term debt

(2.9

)

—

Debt issuance costs

—

(11.1

)

Tax withholding on stock-based compensation

(5.4

)

(2.6

)

Net cash provided by financing activities

261.7

486.3

Decrease in cash, cash equivalents and restricted cash

(47.9

)

(142.6

)

Cash, cash equivalents and restricted cash -- beginning of year

123.4

281.1

Cash, cash equivalents and restricted cash -- end of period

$

75.5

$

138.5

Segment Financial Data and Highlights (Unaudited)

  Three Months Ended

March 31,

2026

2025

Dollars

Margin

Dollars

Margin

(Dollars in millions)

Revenues by segment:

West

$

211.8

$

208.3

Mountain

81.2

66.0

Central

101.2

67.9

Energy Services

20.4

13.9

Total segment revenues

414.6

356.1

Corporate Services and Eliminations

(4.5

)

(2.6

)

Consolidated revenues

$

410.1

$

353.5

EBITDA by segment:

West

$

22.2

10.5

%

$

24.9

12.0

%

Mountain

(8.2

)

(10.1

)%

(16.3

)

(24.6

)%

Central

(26.8

)

(26.5

)%

(24.3

)

(35.8

)%

Energy Services

(4.6

)

(22.6

)%

(7.8

)

(56.0

)%

Total segment EBITDA (a)

(17.4

)

(4.2

)%

(23.5

)

(6.6

)%

Corporate Services and Eliminations (b)

(18.0

)

N.M.

(18.0

)

N.M.

Consolidated EBITDA (a)

$

(35.4

)

(8.6

)%

$

(41.5

)

(11.7

)%

The following table summarizes backlog for the company.

March 31, 2026

March 31, 2025

(In millions)

West

$

180.3

$

242.1

Mountain

500.4

418.3

Central

488.1

278.3

$

1,168.8

$

938.7

Margins on backlog at March 31, 2026, are expected to be lower than the margins on backlog at March 31, 2025. Approximately 88% of the company's contracting services backlog relates to publicly funded projects, including street and highway construction projects. Period over period increases or decreases should not be used as an indicator of future revenues or earnings.

Three Months Ended

March 31,

2026

2025

Sales (thousands):

Aggregates (tons)

4,878

3,867

Ready-mix concrete (cubic yards)

724

544

Asphalt (tons)

283

199

Average selling price:*

Aggregates (per ton)

$

21.22

$

21.05

Ready-mix concrete (per cubic yard)

$

199.76

$

199.26

Asphalt (per ton)

$

74.06

$

81.05

* The average selling price includes freight and delivery and other revenues.

Three Months Ended

March 31,

2026

2025

Dollars

Margin

Dollars

Margin

(Dollars in millions)

Revenues by product line:

Aggregates

$

103.5

$

81.4

Ready-mix concrete

144.5

108.5

Asphalt

21.0

16.1

Liquid asphalt

18.2

12.2

Other*

46.6

43.5

Contracting services

147.8

140.1

Internal sales

(71.5

)

(48.3

)

Total revenues

$

410.1

$

353.5

Gross profit (loss) by product line:

Aggregates

$

(3.7

)

(3.5

)%

$

(6.0

)

(7.4

)%

Ready-mix concrete

15.5

10.7

%

8.7

8.1

%

Asphalt

(4.9

)

(23.6

)%

(5.7

)

(35.4

)%

Liquid asphalt

(2.7

)

(15.0

)%

(4.2

)

(34.3

)%

Other*

(14.8

)

(31.8

)%

(13.2

)

(30.3

)%

Contracting services

7.8

5.3

%

10.8

7.7

%

Total gross loss

$

(2.8

)

(0.7

)%

$

(9.6

)

(2.7

)%

* Other includes cement, merchandise, fabric and spreading, and other products and services that individually are not considered to be a core line of business.

NON-GAAP FINANCIAL MEASURES

EBITDA, EBITDA margin, Adjusted EBITDA, Adjusted EBITDA margin, as well as total segment measures, as applicable, net debt and net leverage are considered non-GAAP measures of financial performance. These non-GAAP financial measures are not measures of financial performance under GAAP. The items excluded from these non-GAAP financial measures are significant components in understanding and assessing financial performance. Therefore, these non-GAAP financial measures should not be considered substitutes for the applicable GAAP metric.

EBITDA, EBITDA margin, Adjusted EBITDA and Adjusted EBITDA margin are most directly comparable to the corresponding GAAP measures of net income and net income margin. Net debt and net leverage are most directly comparable to the corresponding GAAP measures of total debt. We believe these non-GAAP financial measures, in addition to corresponding GAAP measures, are useful to investors by providing meaningful information about operational efficiency compared to our peers by excluding the impacts of differences in tax jurisdictions and structures, debt levels and capital investment. We believe Adjusted EBITDA and Adjusted EBITDA margin are useful performance measures because they allow for an effective evaluation of our operating performance by excluding unrealized gains and losses on benefit plan investments, stock-based compensation, and the impact of selling acquired inventory after markup to fair value as part of acquisition accounting, as they are considered non-cash and not part of our core operations. We believe EBITDA and Adjusted EBITDA assist rating agencies and investors in comparing operating performance across operating periods on a consistent basis by excluding items management does not believe are indicative of the company's operating performance, including using EBITDA and Adjusted EBITDA to calculate Knife River’s leverage as a multiple of EBITDA and Adjusted EBITDA. Additionally, EBITDA and Adjusted EBITDA are important financial metrics for debt investors who utilize debt to EBITDA and debt to Adjusted EBITDA ratios. We believe EBITDA, EBITDA margin, Adjusted EBITDA and Adjusted EBITDA margin, including those measures by segment, are useful performance measures because they provide clarity as to the operational results of the company. Management believes net debt and net leverage are useful performance measures because they provide a measure of how long it would take the company to pay back its debt if net debt and Adjusted EBITDA were constant. Net leverage also allows management to assess our borrowing capacity and optimal leverage ratio. Our management uses these non-GAAP financial measures in conjunction with GAAP results when evaluating our operating results internally and calculating employee incentive compensation, and leverage as a multiple of Adjusted EBITDA to determine the appropriate method of funding our operations.

EBITDA is calculated by adding back income taxes, interest expense (net of interest income) and depreciation, depletion and amortization expense to net income. EBITDA margin is calculated by dividing EBITDA by revenues. Adjusted EBITDA is calculated by adding back unrealized gains and losses on benefit plan investments, stock-based compensation and the impact of selling acquired inventory after markup to fair value as part of acquisition accounting to EBITDA. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by revenues. Net debt is calculated by adding unamortized debt issuance costs to the total debt balance presented on the balance sheet, less any unrestricted cash. Net leverage is calculated by dividing net debt by trailing-twelve-month Adjusted EBITDA. These non-GAAP financial measures are calculated the same for both the segment and consolidated metrics and should not be considered as alternatives to, or more meaningful than, GAAP financial measures such as net income, net income margin and total debt and are intended to be helpful supplemental financial measures for investors’ understanding of our operating performance. Our non-GAAP financial measures are not standardized; therefore, it may not be possible to compare these financial measures with other companies’ EBITDA, EBITDA margin, Adjusted EBITDA, Adjusted EBITDA margin, net debt and net leverage measures having the same or similar names.

The following information reconciles segment and consolidated net income (loss) to EBITDA and Adjusted EBITDA and provides the calculation of EBITDA margin, Adjusted EBITDA margin, net debt and net leverage. Interest expense, net, is net of interest income that is included in other income (expense) on the Consolidated Statements of Operations.

The following table provides the reconciliation of net loss to EBITDA and Adjusted EBITDA.

Three Months Ended

March 31,

2026

2025

(In millions)

Net loss

$

(79.2

)

$

(68.7

)

Depreciation, depletion and amortization

52.2

38.8

Interest expense, net

20.0

13.1

Income taxes

(28.4

)

(24.7

)

EBITDA

$

(35.4

)

$

(41.5

)

Unrealized (gains) losses on benefit plan investments

0.7

0.7

Stock-based compensation expense

2.9

2.8

Adjusted EBITDA

$

(31.8

)

$

(38.0

)

Revenue

$

410.1

$

353.5

Net loss margin

(19.3

)%

(19.4

)%

EBITDA margin

(8.6

)%

(11.7

)%

Adjusted EBITDA margin

(7.8

)%

(10.7

)%

The following table provides the reconciliation of consolidated net loss to total segment EBITDA.

Three Months Ended

March 31,

2026

2025

(In millions)

Net loss

$

(79.2

)

$

(68.7

)

Depreciation, depletion and amortization

52.2

38.8

Interest expense, net

20.0

13.1

Income taxes

(28.4

)

(24.7

)

EBITDA

$

(35.4

)

$

(41.5

)

Less corporate services EBITDA

(18.0

)

(18.0

)

Total segment EBITDA

$

(17.4

)

$

(23.5

)

The following tables provide the reconciliation of the net leverage calculation of net debt to Adjusted EBITDA.

Twelve Months Ended

March 31, 2026

Three Months Ended March 31, 2026

Twelve Months Ended December 31, 2025

Three Months Ended March 31, 2025

(In millions)

Net income (loss)

$

146.6

$

(79.2

)

$

157.1

$

(68.7

)

Depreciation, depletion and amortization

207.1

52.2

193.7

38.8

Interest expense, net

84.3

20.0

77.4

13.1

Income taxes

52.4

(28.4

)

56.1

(24.7

)

EBITDA

$

490.4

$

(35.4

)

$

484.3

$

(41.5

)

Unrealized (gains) losses on benefit plan investments

(2.9

)

0.7

(2.9

)

0.7

Stock-based compensation expense

11.5

2.9

11.4

2.8

Impact of selling acquired inventory after markup to fair value as part of acquisition accounting

3.7

—

3.7

—

Adjusted EBITDA

$

502.7

$

(31.8

)

$

496.5

$

(38.0

)

The following table provides the reconciliation of the net leverage calculation of net debt to Adjusted EBITDA.

Twelve Months Ended

March 31, 2026

(In millions)

Long-term debt

$

1,421.6

Long-term debt - current portion

11.7

Total debt

1,433.3

Add: Unamortized debt issuance costs

14.9

Total debt, gross

1,448.2

Less: Cash and cash equivalents, excluding restricted cash

13.3

Total debt, net

$

1,434.9

Trailing-twelve-months ended March 31, 2026, Adjusted EBITDA

$

502.7

Net leverage

2.9

x

Knife River’s projections for 2026 Adjusted EBITDA, 2026 Adjusted EBITDA margin and long-term net leverage target are non-GAAP financial measures that exclude or otherwise have been adjusted for non-GAAP adjustment items from Knife River’s financial statements. When the company provides its forward-looking 2026 Adjusted EBITDA, 2026 Adjusted EBITDA margin and long-term net leverage target, it does not provide a reconciliation of these non-GAAP financial measures as Knife River is unable to predict with a reasonable degree of certainty the actual impact of the non-GAAP adjustment items. By their very nature, non-GAAP adjustment items are difficult to anticipate with precision because they are generally associated with unexpected and unplanned events that impact our company and its financial results, including, but not limited to, the potentially high variability, complexity and low visibility with respect to the items that would be excluded from the applicable GAAP measure in the relevant future period, such as unusual gains and losses, the impact and timing of potential acquisitions and divestitures, certain financing costs and other structural changes or their probable significance. Therefore, Knife River is unable to provide a reconciliation of these measures without unreasonable efforts.

FORWARD-LOOKING STATEMENTS

The information in this news release highlights the key growth strategies, projections and certain assumptions for the company and its subsidiaries. Many of these highlighted statements and other statements not historical in nature are “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Although the company believes that its expectations are expressed in good faith and based on reasonable assumptions, there is no assurance the company’s statements with respect to its EDGE strategy, shareholder value creation, financial guidance, expected long-term goals, expected backlog margin, or other proposed strategies will be achieved. Please refer to assumptions contained in this news release, as well as the various important factors listed in Part I, Item 1A - Risk Factors in the company's most recent Form 10-K and subsequent filings with the Securities and Exchange Commission.

Changes in such assumptions and factors could cause actual future results to differ materially from those expressed in the forward-looking statements. All forward-looking statements in this news release are expressly qualified by such cautionary statements and by reference to the underlying assumptions. Undue reliance should not be placed on forward-looking statements, which speak only as of the date they are made. Except as required by law, the company does not undertake to update forward-looking statements, whether as a result of new information, future events or otherwise.

Knife River (KNF - Free Report) reported $410.1 million in revenue for the quarter ended March 2026, representing a year-over-year increase of 16%. EPS of -$1.40 for the same period compares to -$1.21 a year ago.

The reported revenue compares to the Zacks Consensus Estimate of $386.59 million, representing a surprise of +6.08%. The company delivered an EPS surprise of +1.18%, with the consensus EPS estimate being -$1.42.

While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance.

As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately.

Here is how Knife River performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

Revenue- Contracting services: $147.8 million compared to the $146.46 million average estimate based on two analysts.Revenues- Aggregates: $103.5 million versus $91.66 million estimated by two analysts on average.Revenues- Internal sales: $-71.5 million compared to the $-52.1 million average estimate based on two analysts.Revenues- Asphalt: $21 million versus $16.65 million estimated by two analysts on average.Revenues- Ready-mix concrete: $144.5 million compared to the $132.96 million average estimate based on two analysts.View all Key Company Metrics for Knife River here>>>

Shares of Knife River have returned +20.7% over the past month versus the Zacks S&P 500 composite's +9.5% change. The stock currently has a Zacks Rank #4 (Sell), indicating that it could underperform the broader market in the near term.

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, /PRNewswire/ -- WEC Energy Group Inc. (NYSE: WEC) will issue its 2026 first-quarter earnings news release before the stock market opens Tuesday, May 5. A conference call for investors and security analysts is scheduled for the same day at 1 p.m. Central time.

Detailed financial information will be available on the WEC Energy Group website by 6:30 a.m. Central time May 5.

To listen to webcast

Go to wecenergygroup.com. Under 'Webcasts,' select 'Q1 Earnings' at any point within 15 minutes of the start of the call. To listen to conference call

Conference ID: 3088105 Live: 888-330-2443. International: 240-789-2728 Replay: 800-770-2030. International: 647-362-9199
(replay available for two weeks following event) WEC Energy Group (NYSE: WEC), based in Milwaukee, is one of the nation's premier energy companies, serving 4.8 million customers in Wisconsin, Illinois, Michigan and Minnesota.

The company's principal utilities are We Energies, Wisconsin Public Service, Peoples Gas, North Shore Gas, Michigan Gas Utilities, Minnesota Energy Resources and Upper Michigan Energy Resources. Another major subsidiary, We Power, designs, builds and owns electric generating plants. In addition, WEC Infrastructure LLC owns a fleet of renewable generation facilities in states ranging from South Dakota to Texas.

WEC Energy Group (wecenergygroup.com) is a Fortune 500 company and a component of the S&P 500. The company has approximately 32,000 stockholders of record, 7,000 employees and more than $51 billion of assets.

SOURCE WEC Energy Group

Key Takeaways D is expected to report Q1 EPS of 89 cents and revenues of $4.25 billion on May 1. Dominion Energy may benefit from Virginia data center demand and new rate implementation. D's offshore wind output and grid investments may aid earnings despite higher expenses. Dominion Energy (D - Free Report) is scheduled to release first-quarter 2026 results on May 1, before the market opens. The company delivered an earnings surprise of 6.25% in the last reported quarter.

Let’s discuss the factors that are likely to be reflected in the upcoming quarterly results.

Dominion’s Q1 ExpectationsThe Zacks Consensus Estimate for earnings is pegged at 89 cents per share, indicating a year-over-year decline of 4.3%.

The Zacks Consensus Estimate for revenues is pinned at $4.25 billion, reflecting a 4.3% improvement year over year.

Factors Likely to Have Influenced D’s Q1 EarningsDominion Energy’s first quarter is likely to have benefited from a rise in load growth, supported by strong electricity demand from large-scale data center expansion in Virginia. This is likely to have boosted the revenues and supported earnings.

Dominion Energy is also likely to have benefited from new rate implementation in its service region and an increase in electric demand driven by an expanding customer base. The first power offshore wind project is expected to have been delivered to the grid during the first-quarter, which is likely to have a positive impact on the company’s earnings.

The company is making strategic investments in expanding renewable energy, regulated assets, and upgrading and maintaining its transmission and distribution infrastructure. This is likely to have enhanced operational efficiency and service reliability, acting as an earnings tailwind.

However, return to normal weather, rise in financing expenses, operation and maintenance expenses, and share dilution might have weighed on some positives.

What Our Quantitative Model Says About DOur proven model predicts an earnings beat for Dominion Energy this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here, as you will see below.

Earnings ESP: The company’s Earnings ESP is +1.31%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Currently, Dominion Energy carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Dominion Energy Inc. Price and EPS SurpriseInvestors may consider the following players from the same industry, as these have the right combination of elements to post an earnings beat this reporting cycle.

WEC Energy Group (WEC - Free Report) is likely to come up with earnings beat when it reports first-quarter results on May 5. It has an Earnings ESP of +0.54% and a Zacks Rank #3 at present.

WEC’s long-term (three to five years) earnings growth rate is 7.44%. The Zacks Consensus Estimate for first-quarter EPS is pinned at $2.31, which implies a year-over-year increase of 1.76%.

Ameren Corporation (AEE - Free Report) is set to report first-quarter results on May 6 and is likely to have come up with an earnings beat. It has an Earnings ESP of +1.29% and a Zacks Rank #3 at present.

AEE’s long-term earnings growth rate is 9.27%. The Zacks Consensus Estimate for first-quarter EPS is pinned at $1.17, which implies a year-over-year increase of 9.35%.

NiSource Inc. (NI - Free Report) is scheduled to report first-quarter results on May 6 and is likely to have come up with an earnings beat. It has an Earnings ESP of +2.34% and a Zacks Rank #3 at present.

NI’s long-term earnings growth rate is 6.11%. The Zacks Consensus Estimate for first-quarter EPS is pinned at $1.03, which implies a year-over-year increase of 5.10%.

If you are looking for a stock that has a solid history of beating earnings estimates and is in a good position to maintain the trend in its next quarterly report, you should consider WEC Energy Group (WEC - Free Report) . This company, which is in the Zacks Utility - Electric Power industry, shows potential for another earnings beat.

This electricity and natural gas provider has seen a nice streak of beating earnings estimates, especially when looking at the previous two reports. The average surprise for the last two quarters was 3.98%.

For the most recent quarter, WEC Energy was expected to post earnings of $1.38 per share, but it reported $1.42 per share instead, representing a surprise of 2.90%. For the previous quarter, the consensus estimate was $0.79 per share, while it actually produced $0.83 per share, a surprise of 5.06%.

Price and EPS Surprise

With this earnings history in mind, recent estimates have been moving higher for WEC Energy. In fact, the Zacks Earnings ESP (Expected Surprise Prediction) for the company is positive, which is a great sign of an earnings beat, especially when you combine this metric with its nice Zacks Rank.

Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be as high as seven.

The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.

WEC Energy currently has an Earnings ESP of +0.54%, which suggests that analysts have recently become bullish on the company's earnings prospects. This positive Earnings ESP when combined with the stock's Zacks Rank #3 (Hold) indicates that another beat is possibly around the corner. We expect the company's next earnings report to be released on May 5, 2026.

With the Earnings ESP metric, it's important to note that a negative value reduces its predictive power; however, a negative Earnings ESP does not indicate an earnings miss.

Many companies end up beating the consensus EPS estimate, though this is not the only reason why their shares gain. Additionally, some stocks may remain stable even if they end up missing the consensus estimate.

Because of this, it's really important to check a company's Earnings ESP ahead of its quarterly release to increase the odds of success. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

WEC Energy Group (WEC - Free Report) came out with quarterly earnings of $2.45 per share, beating the Zacks Consensus Estimate of $2.33 per share. This compares to earnings of $2.27 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of +5.30%. A quarter ago, it was expected that this electricity and natural gas provider would post earnings of $1.38 per share when it actually produced earnings of $1.42, delivering a surprise of +2.9%.

Over the last four quarters, the company has surpassed consensus EPS estimates four times.

WEC Energy, which belongs to the Zacks Utility - Electric Power industry, posted revenues of $3.43 billion for the quarter ended March 2026, surpassing the Zacks Consensus Estimate by 7.00%. This compares to year-ago revenues of $3.15 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.

WEC Energy shares have added about 10.4% since the beginning of the year versus the S&P 500's gain of 5.2%.

What's Next for WEC Energy?While WEC Energy 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 WEC Energy 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 $0.84 on $2.05 billion in revenues for the coming quarter and $5.60 on $10.31 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, Utility - Electric Power is currently in the top 38% 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.

One other stock from the same industry, PPL (PPL - Free Report) , is yet to report results for the quarter ended March 2026. The results are expected to be released on May 8.

This energy and utility holding company is expected to post quarterly earnings of $0.61 per share in its upcoming report, which represents a year-over-year change of +1.7%. The consensus EPS estimate for the quarter has been revised 2.8% lower over the last 30 days to the current level.

PPL's revenues are expected to be $2.62 billion, up 4.7% from the year-ago quarter.

Electrical transmission towers, poles and lines are shown in the early morning of a hot summer day in Commerce, California, U.S, August 7, 2025. REUTERS/Mike Blake Purchase Licensing Rights, opens new tab

May 5 (Reuters) - Utility firm WEC Energy (WEC.N), opens new tab reported a rise in first-quarter profit on Tuesday, supported ​by higher sales of power to residential and industrial customers, ‌and said it was working with large hyperscale clients to serve potential load growth of up to 4 gigawatts.

U.S. power consumption is expected to rise further this year, after ​hitting its second straight annual record high in 2025, driven mainly by Big ​Techs' race to build energy-intensive data centers to support AI ⁠initiatives, and homes and businesses increasingly using electricity for heat and transportation.

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WEC ​said on a post-earnings call it had received regulatory approval to buy ​three more solar projects and a battery storage project, with plans to invest $730 million.

Electricity usage from large commercial and industrial customers rose 2.7% during the quarter, while consumption among ​small commercial and industrial customers increased 0.7%, the company said.

Residential electricity usage ​edged up 0.2% from a year earlier, lifting total retail electricity deliveries by 1.3%, ‌excluding ⁠sales to an iron ore mine.

WEC, which serves nearly 4.7 million electric and natural gas customers across Wisconsin, Illinois, Michigan and Minnesota, said natural gas deliveries in Wisconsin fell 2.1% in the first quarter.

The company provides natural ​gas through its We ​Power and Wisconsin ⁠Public Service units.

"The continued execution of our capital plan and focus on operating efficiencies led to solid first-quarter ​results," said CEO Scott Lauber.

WEC had said in February it ​would raise ⁠capital spending by $1 billion over the next five years as it increases output to power Microsoft (MSFT.O), opens new tab data centers.

The company also expects to add incremental capital spending ⁠to ​its plan in the third quarter.

The company's quarterly ​net income rose to $804.4 million, or $2.45 per share, from $724.2 million, or $2.27 per share, a year ​ago.

Reporting by Dharna Bafna in Bengaluru; Editing by Shilpi Majumdar and Tasim Zahid

Our Standards: The Thomson Reuters Trust Principles., opens new tab

Key Takeaways WEC posted Q1 EPS of $2.45, beating estimates and rising 7.9% from the prior-year quarter. WEC revenue rose 9% year over year to $3.43B, driven by higher electricity consumption.WEC plans $37.5B in investments through 2030 to support long-term EPS growth of 7-8%. WEC Energy Group (WEC - Free Report) reported first-quarter 2026 earnings of $2.45 per share, which surpassed the Zacks Consensus Estimate of $2.33 by 5.15%. The bottom line also increased 7.93% from the year-ago quarter’s $2.27.

WEC’s RevenuesOperating revenues of $3.43 billion surpassed the Zacks Consensus Estimate of $3.21 billion by around 6.98%. The top line also increased 9.02% from $3.15 billion recorded in the year-ago quarter.

Highlights of WEC’s Earnings ReleaseIn the first quarter of 2026, electricity consumption increased 0.7% for small commercial and industrial customers, 2.7% for large commercial and industrial customers, excluding the iron-ore mine, and 0.2% for residential customers.

On a weather-normal basis, retail deliveries of electricity, excluding the iron-ore mine, increased 1.3%.

Total operating expenses were $2.45 billion, up 10.95% from the year-ago level of $2.21 billion, primarily due to higher cost of sales.

Operating income totaled $980 million, up 4.53% from $937.5 million recorded in the year-ago quarter.

The company incurred an interest expense of $228.5 million, up 2.47% from the prior-year level of $223 million.

WEC’s Financial PositionAs of March 31, 2026, WEC had cash and cash equivalents of $45.6 million compared with $27.6 million as of Dec. 31, 2025.

As of March 31, 2026, the company had a long-term debt of $19.38 billion compared with $18.50 billion as of Dec. 31, 2025.

Net cash provided by operating activities during the first three months of 2026 was $1.22 billion compared with $1.16 billion in the year-ago period.

WEC’s GuidanceWEC reaffirmed its 2026 earnings outlook of $5.51-$5.61 per share. The Zacks Consensus Estimate is pegged at $5.60, which lies at the higher end of the company’s projected range.

The company plans to invest a total of $7.4 billion in modern, efficient natural gas generation and LNG storage, and $12.6 billion to add 6,535 megawatts in renewable energy over the 2026-2030 period.

WEC Energy expects to invest $37.5 billion during the 2026-2030 period, which supports 7-8% long-term EPS growth. The company plans to invest $5.67 billion in 2026.

WEC’s Zacks RankThe company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Utilities ReleasesAlgonquin Power & Utilities Corp. (AQN - Free Report) is scheduled to report first-quarter results on May 8. The Zacks Consensus Estimate for first-quarter EPS is pinned at 11 cents, which implies a year-over-year decrease of 21.43%.

The Zacks Consensus Estimate for first-quarter sales is pinned at $697.9 million, which suggests year-over-year growth of 0.79%.

PPL Corporation (PPL - Free Report) is scheduled to report first-quarter results on May 8. The Zacks Consensus Estimate for first-quarter EPS is pinned at 61 cents, which implies a year-over-year increase of 1.67%.

The Zacks Consensus Estimate for first-quarter sales is pinned at $2.62 billion, which suggests year-over-year growth of 4.65%.

Global Water Resources, Inc. (GWRS - Free Report) is scheduled to report first-quarter results on May 14. The Zacks Consensus Estimate for first-quarter EPS is pinned at a loss of 2 cents, which implies a year-over-year decrease of 200%.

The Zacks Consensus Estimate for first-quarter sales is pinned at $13.0 million, which suggests year-over-year growth of 4.33%.

WEC Energy Group, Inc. (WEC) Shareholder/Analyst Call Transcript

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The VictoryShares US Large Cap High Div Volatility Wtd ETF (NASDAQ:CDL) pulls its distribution from dividends paid by large U.S. companies that have screened in for both yield and lower realized volatility. CDL is volatility weighted rather than market-cap weighted (the index methodology pushes back against market-cap concentration risk), which means a handful of regulated utilities and a couple of mega-cap tech names tend to anchor the portfolio. The question for income investors is straightforward: are those underlying dividends durable, or is CDL’s payout at risk?

How CDL produces its yield CDL collects cash dividends from its roughly 100 large-cap holdings and passes them through to shareholders. There are no options premiums, no leverage, and no synthetic income at work. The distribution rises or falls based on what the underlying companies pay. Fund-level details such as the current 30-day SEC yield and expense ratio were not retrievable in our data pull, so this safety read focuses on the dividend health of the listed anchors.

The utility core does the heavy lifting WEC Energy Group (NYSE:WEC | WEC Price Prediction) raised its quarterly payout 6.7% to $0.9525, extending a 23rd consecutive year of increases on a 3.3% yield. With $3.38 billion in 2025 operating cash flow and 2026 EPS guidance of $5.51 to $5.61, coverage is comfortable. The Illinois $205 million pre-tax regulatory charge is a one-time pressure point, not a structural threat to the payout.

Duke Energy (NYSE:DUK) earned $6.31 in adjusted EPS for 2025 against a $4.24 annual dividend, leaving payout coverage near 2x. The $103 billion five-year capital plan and contracted AI demand support 5% to 7% EPS growth through 2030, which translates into a clear runway for continued dividend hikes.

FirstEnergy (NYSE:FE) lifted its quarterly dividend 4.5% to $0.465, a 68% payout ratio at the midpoint of 2026 guidance that sits squarely inside the company’s 60% to 70% target band. Alliant Energy and Evergy round out the regulated cohort with quarterly payouts of $0.535 and $0.695 respectively, both stepping up off long-term growth plans tied to data center electricity contracts. The common thread: regulated rate bases, formula-rate recovery mechanisms, and contracted demand growth that make these dividends among the most predictable income streams in the large-cap universe.

The mega-cap tech anomaly For a fund branded around high dividends, the inclusion of Microsoft at a 0.9% yield and Apple at 0.4% looks counterintuitive. Both qualify because they pay growing dividends with extreme coverage. Microsoft stepped its quarterly payout from $0.83 to $0.91 in late 2025, and Apple lifted to $0.27 alongside a $100 billion buyback authorization. These positions add minimal yield but anchor the portfolio with fortress balance sheets.

Total return and rate-environment context CDL has returned 19% over the past year and 11% year to date, so the income is arriving alongside capital appreciation rather than NAV erosion. The 10-year Treasury near 4.4% creates competition for utility yields and pressures valuations, which is the single biggest macro risk to the underlying holdings.

Verdict on the distribution CDL’s payout looks durable. Five regulated utilities with multi-decade dividend records and contracted data-center growth provide the income spine. Microsoft and Apple add ballast without subtracting much from coverage. Investors should size CDL as a steady-income sleeve rather than a high-yield vehicle. Income seekers targeting a 6%-plus yield will find CDL’s headline number trails covered-call alternatives. For an investor wanting reliable, growing dividends from large U.S. names without single-stock concentration, the safety read here is reassuring.

A month has gone by since the last earnings report for WEC Energy Group (WEC - Free Report) . Shares have lost about 3.4% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is WEC Energy due for a breakout? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for WEC Energy Group, Inc. before we dive into how investors and analysts have reacted as of late.

WEC Energy Q1 Earnings Surpass Estimates, Revenues Increase Y/Y

WEC Energy Group reported first-quarter 2026 earnings of $2.45 per share, which surpassed the Zacks Consensus Estimate of $2.33 by 5.15%. The bottom line also increased 7.93% from the year-ago quarter’s $2.27.

WEC’s RevenuesOperating revenues of $3.43 billion surpassed the Zacks Consensus Estimate of $3.21 billion by around 6.98%. The top line also increased 9.02% from $3.15 billion recorded in the year-ago quarter.

Highlights of WEC’s Earnings ReleaseIn the first quarter of 2026, electricity consumption increased 0.7% for small commercial and industrial customers, 2.7% for large commercial and industrial customers, excluding the iron-ore mine, and 0.2% for residential customers.

On a weather-normal basis, retail deliveries of electricity, excluding the iron-ore mine, increased 1.3%.

Total operating expenses were $2.45 billion, up 10.95% from the year-ago level of $2.21 billion, primarily due to higher cost of sales.

Operating income totaled $980 million, up 4.53% from $937.5 million recorded in the year-ago quarter.

The company incurred an interest expense of $228.5 million, up 2.47% from the prior-year level of $223 million.

WEC’s Financial PositionAs of March 31, 2026, WEC had cash and cash equivalents of $45.6 million compared with $27.6 million as of Dec. 31, 2025.

As of March 31, 2026, the company had a long-term debt of $19.38 billion compared with $18.50 billion as of Dec. 31, 2025.

Net cash provided by operating activities during the first three months of 2026 was $1.22 billion compared with $1.16 billion in the year-ago period.

WEC’s GuidanceWEC reaffirmed its 2026 earnings outlook of $5.51-$5.61 per share. The Zacks Consensus Estimate is pegged at $5.60, which lies at the higher end of the company’s projected range.

The company plans to invest a total of $7.4 billion in modern, efficient natural gas generation and LNG storage, and $12.6 billion to add 6,535 megawatts in renewable energy over the 2026-2030 period.

WEC Energy expects to invest $37.5 billion during the 2026-2030 period, which supports 7-8% long-term EPS growth. The company plans to invest $5.67 billion in 2026.

How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a downward trend in estimates revision.

VGM ScoresCurrently, WEC Energy has a average Growth Score of C, however its Momentum Score is doing a bit better with a B. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for value investors.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

OutlookEstimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise WEC Energy has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.

Performance of an Industry PlayerWEC Energy is part of the Zacks Utility - Electric Power industry. Over the past month, Dominion Energy (D - Free Report) , a stock from the same industry, has gained 6.2%. The company reported its results for the quarter ended March 2026 more than a month ago.

Dominion Energy reported revenues of $5.02 billion in the last reported quarter, representing a year-over-year change of +23.1%. EPS of $0.95 for the same period compares with $0.93 a year ago.

Dominion Energy is expected to post earnings of $0.82 per share for the current quarter, representing a year-over-year change of +9.3%. Over the last 30 days, the Zacks Consensus Estimate has changed -0.7%.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Dominion Energy. Also, the stock has a VGM Score of D.