The deal came through Accenture Ventures and targets faster enterprise decision-making across complex industrial operations.
Accenture plans to combine Aera's decision intelligence platform with its AI-enabled supply-chain services for large global industries.
AI Supply Chains Gain MomentumThe companies aim to deliver automated and real-time operational decisions across consumer goods, life sciences and technology sectors. Mining and oil-and-gas companies also remain part of the target customer base.
Accenture said many corporations still rely on disconnected supply-chain workflows and labor-intensive processes. Internal research showed most businesses remain early in autonomous supply-chain adoption.
The company reported that only 25% of surveyed firms have started deploying autonomous capabilities.
Median operational maturity measured just 16% on Accenture's internal autonomy scale.
Aera Technology's Platform RoleAera develops AI-powered systems that monitor operational changes and recommend enterprise actions in real time. The platform also automates selected business decisions under human supervision.
Management said Aera's technology spans procurement, finance, operations and supply-chain planning functions.
The system also learns from previous outcomes to improve future performance and operational efficiency.
Chris McDivitt, global lead for autonomous supply chains at Accenture, highlighted increasing pressure on enterprise logistics networks.
"Today’s business environment is constantly stress-testing supply chains," McDivitt said.
Enterprise Customers Expand AI AdoptionThe Hershey Company (NYSE:HSY) already uses AI-enabled operational decision systems developed through Accenture and Aera collaborations.
Douglas Guilherme, Hershey's global supply-chain senior vice president, said companies increasingly need predictive decision-making capabilities.
Fred Laluyaux, co-founder and CEO of Aera Technology, said enterprises increasingly rely on intelligent systems to manage operational complexity.
Accenture did not disclose financial terms tied to the investment.
ACN Price Action: Accenture shares were up 0.57% at $178.56 at the time of publication on Tuesday, according to Benzinga Pro data.
Image via Shutterstock
This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Market News and Data brought to you by Benzinga APIs
On May 27, 2026, The Hershey Co (HSY) shares rose 3.5% today, closing at $197.82. The stock has experienced significant price movements recently, with a 52-week
Jason Reiman, a 30-Year Hershey Veteran, to Retire Following Planned Leadership Transition
, /PRNewswire/ -- The Hershey Company (NYSE: HSY) today announced that Mitchell Arends has been named Chief Supply Chain Officer, effective June 22, 2026. Arends succeeds Jason Reiman, who is retiring after a 30-year career with the company. Reiman will remain through April 2027 to ensure a thorough and structured leadership transition.
Mitchell Arends Arends brings more than 25 years of end-to-end supply chain leadership in consumer-packaged goods. He joins Hershey from UTZ Brands, where he served as Executive Vice President, Principal Operating Officer, and Chief Integrated Supply Chain Officer, with full operational accountability for a $1.5 billion business spanning supply chain, R&D, transformation and direct store delivery (DSD) operations. Prior to UTZ, Arends served as Chief Supply Chain Officer of North America at Kraft Heinz, responsible for a $22 billion supply chain across manufacturing, logistics, planning, and procurement.
"Mitch is a proven transformational leader with the end-to-end mindset, track record, and people-first approach that will continue to drive Hershey's supply chain forward," said Kirk Tanner, President and CEO, The Hershey Company. "His experience across complex operations in the CPG industry makes him well-suited to build on the foundation Jason has established. At the same time, we are deeply grateful to Jason. His 30-year journey from intern to Chief Supply Chain Officer reflects the commitment and character that define this company. He leaves a supply chain that is stronger, more capable, and better positioned than ever."
Arends will have end-to-end accountability for Hershey's integrated supply chain — manufacturing, procurement, logistics, and planning. He will focus on accelerating digital integration and automation and advancing insights-driven planning across the network.
During the transition period through the first quarter of 2027, Reiman will partner with Arends on supply chain modernization, with a focus on integrated planning, accelerated digital capabilities and network optimization.
Reiman joined Hershey as an intern and built a career spanning the full breadth of the supply chain. His significant contributions include bringing core capacity and expanded confection capabilities in-house, standing up two fully digitally integrated manufacturing facilities and building the salty snacks network that is now 80% insourced.
"The opportunity to continue building a supply chain for some of the world's most iconic products is an exciting moment in my career," said Mitchell Arends. "Doing that in a way that develops people and strengthens the communities where we operate makes it even more so. Building a supply chain fit for the future means more than deploying technology or optimizing networks. It means developing the talent capable of sustaining that transformation long after any single initiative is complete."
"I've always believed that great leadership is a relay. I'm proud to hand this baton to Mitch," said Jason Reiman, Chief Supply Chain Officer, The Hershey Company. "He has the vision, the experience, and the values to carry this work forward and to uphold what Milton Hershey built. I'm grateful for every year, for the people I worked alongside, and for what this company stands for."
About The Hershey Company
The Hershey Company is an industry-leading snacks company with a purpose to make more moments of goodness and a vision to lead next generation snacking. Hershey brings together more than 20,000 employees worldwide to deliver delicious, high-quality products across more than 85 brands in approximately 65 countries, generating more than $11.7 billion in annual revenues.
Hershey brings its full portfolio to market as ONE Hershey, spanning confection, salty and functional snacking categories with beloved brands like Hershey's, Reese's, Kisses, KIT KAT®, Jolly Rancher, Twizzlers and Ice Breakers; salty snacks including SkinnyPop, LesserEvil, Pirate's Booty and Dot's Homestyle Pretzels; and a protein portfolio including ONE Brands and Fulfil.
For more than 130 years, Hershey has operated fairly, ethically and sustainably. Founder Milton Hershey established Milton Hershey School in 1909, and that legacy of purpose endures today through the company's commitment to helping children succeed through equitable access to education.
Key Takeaways HSY Q1 net sales rose 10.6% to $3,104.2 million, driven by about 10 points of net price realization. Hershey saw volume fall nearly 2 points as price elasticity weighed on shipments despite pricing gains. HSY adjusted gross margin fell 80 bps to 40.4% as commodity and tariff-related costs outweighed benefits. The Hershey Company (HSY - Free Report) is leaning on one of its biggest competitive strengths, pricing power, to navigate an environment marked by elevated commodity and tariff-related costs. The company’s first-quarter 2026 results showed that consumers continued to absorb higher prices across key markets, helping support sales growth even as volume trends remained pressured.
Net sales increased 10.6% to $3,104.2 million in the quarter, while organic, constant-currency net sales rose 7.9%. The increase was driven primarily by approximately 10 points of net price realization, partly offset by an approximately 2-point decline in volume.
The performance highlights Hershey’s ability to push through pricing actions while maintaining demand across much of its portfolio. However, the results also illustrate the trade-off between pricing and volume, as elasticity pressures continued to weigh on shipment volumes in certain businesses.
Pricing Continues to Do the Heavy Lifting for HersheyNorth America Confectionery remained a clear example of the pricing strategy at work. Organic, constant-currency net sales increased 8%, supported by approximately 12 points of net price realization. Volume declined about 4%, reflecting price elasticity and one fewer shipping day, though the impact was partly offset by favorable shipment timing and innovation performance.
A similar trend emerged internationally. Net sales increased 16.1%, while organic, constant-currency sales rose 9.3%. Pricing contributed roughly 12 points of growth, reflecting strategic pricing actions across markets. Volume decreased approximately 2%, reflecting elasticity impacts, partially offset by favorable shipment timing in select markets and continued strength in Brazil.
While pricing boosted revenue growth, cost inflation continued to pressure profitability. HSY’s adjusted gross margin declined 80 basis points to 40.4%, as higher commodity and tariff-related costs more than offset pricing benefits and productivity gains.
Pricing actions are supporting top-line growth and helping mitigate inflationary pressures, but commodity and tariff-related costs remain a meaningful margin headwind. The effectiveness of future pricing actions, combined with productivity and transformation savings, will remain central to how successfully Hershey manages these cost pressures through the remainder of the year.
The Zacks Rank #3 (Hold) stock has risen 6.5% over the past six months compared with the industry’s growth of 5.2%.
Image Source: Zacks Investment Research
Stocks to ConsiderThe Chef's Warehouse, Inc. (CHEF - Free Report) , a specialty food distributor serving restaurants, hotels and hospitality customers, 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 The Chef's Warehouse’s current financial-year sales and earnings indicates growth of 8.3% and 24.7%, respectively, from the prior-year reported levels. CHEF delivered a trailing four-quarter earnings surprise of 28.9%, on average.
Tyson Foods, Inc. (TSN - Free Report) operates as a leading protein company, producing chicken, beef, pork and prepared food products. TSN currently carries a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for Tyson Foods’ current fiscal-year sales calls for growth of 4.5%, while the consensus mark for earnings indicates a 0.5% increase from the year-ago reported figures. TSN delivered a trailing four-quarter earnings surprise of 18.1%, on average.
Flowers Foods, Inc. (FLO - Free Report) is a leading U.S. bakery company that manufactures and markets packaged bakery foods, including bread, buns, snack cakes and tortillas, under brands such as Nature’s Own, Wonder and Dave’s Killer Bread. FLO carries a Zacks Rank #2.
The Zacks Consensus Estimate for Flowers Foods’ current and next fiscal-year EPS has seen upward revisions by 5.6% and 11.9%, respectively, over the past 60 days.
Zacks' 7 Best Strong Buy Stocks (New Research Report) Valued at $99, click below to receive our just-released report predicting the 7 stocks that will soar highest in the coming month.
Macroeconomic headwinds have weighed on shares of top consumer brands. For income investors, this weakness is a gift, as lower stock prices have pushed dividend yields to attractive levels.
Here's why Home Depot (HD +0.41%), Hershey (HSY +1.21%), and Diageo (DEO +0.00%) are some of the most attractive dividend stocks to buy right now.
Image source: Getty Images.
1. Home Depot Shares of Home Depot are currently trading 29% below their previous high. Sales growth has been pressured by elevated interest rates, which have made financing home projects more expensive. But this is exactly when you want to invest in Home Depot, because the stock won't offer value like this in a roaring economy.
At the current quarterly payment of $2.33 per share ($9.32 annually), the forward dividend yield is 2.98% -- nearly three times the S&P 500 (^GSPC +0.31%) average. That payout is fully supported by earnings, with a payout ratio of 65%. The yield is also near the high end of the stock's historical range.
Today's Change
(
0.41
%) $
1.35
Current Price
$
327.36
In the first quarter, comparable sales increased 0.6% year over year. Adjusted earnings dipped to $3.43 from $3.56 in the year-ago quarter, but steady comp sales are encouraging in this environment. Home Depot is well positioned for faster growth when demand rebounds.
The business is gaining share with professional customers. It's seeing double-digit growth in digital orders and rolling out new artificial intelligence (AI) tools, such as Blueprint Takeoffs, to help Pros plan projects more efficiently.
These new services are helping unlock a larger addressable market, particularly in complex projects, which management estimates to be worth $400 billion. That growth potential, paired with an above-average yield, makes Home Depot one of the best dividend stocks to consider in 2026.
2. Hershey Shares of Hershey are down 29% from their high as the company has dealt with higher cocoa prices and headwinds from more consumers taking weight-loss drugs. Despite the challenges, its brand portfolio -- including Reese's, Skinny Pop, and Dot's Pretzels -- has held up well.
Organic (currency-neutral) sales grew nearly 8% year over year in the first quarter, while adjusted earnings rose 12%. Hershey still looks capable of delivering steady growth for years, since it's highly unlikely people will ever stop buying chocolate. Statista estimates the global confectionery market at $146 billion in 2026, with annual growth of 5% through 2031.
Today's Change
(
1.21
%) $
2.19
Current Price
$
183.03
Hershey is targeting low-single-digit full-year adjusted sales growth for 2026. Management is also working to lift margins through supply chain adjustments, which should support earnings and dividend growth.
Hershey has paid a consistent dividend for 96 years. The payout ratio has recently climbed to around 100% of earnings, which might be alarming. However, when compared to free cash flow, the payout ratio is closer to 60%, indicating payment sustainability. With cocoa prices easing and margins set to improve, the current forward yield of 3% looks especially attractive for the leading chocolate brand.
3. Diageo Diageo offers the highest yield of the three, currently around 3.88% on a trailing-12-month basis. It paid out 91% of its free cash flow over the last year, which is near the upper end of what's sustainable. But Diageo is targeting higher free cash flow over the next few years. It owns one of the strongest portfolios in beer and spirits -- including Guinness, Johnnie Walker, and Smirnoff -- giving it pricing power and steady cash flow.
Today's Change
(
0.00
%) $
0.00
Current Price
$
81.12
The stock is down 61% from its previous high, reflecting recent softness in North America, offset by growth in Europe, Latin America, and China. Overall, Diageo's organic net sales increased 0.3% year over year last quarter, marking an improvement over recent declines. Stabilizing sales, with strong markets offsetting weakness in others, shows the value of its diversified portfolio of more than 200 brands.
Diageo paid $2.3 billion in dividends over the last year, supported by $2.5 billion in free cash flow. This should mark a low point in free cash generation, as management is looking to trim costs and boost annual free cash flow to $3 billion.
Over time, investing in top alcohol stocks when they offer high yields is a good bet. Demand can fluctuate, but it eventually recovers. Diageo should benefit as consumers trade up to premium beverages while consuming less quantity. That dynamic can support higher prices and margins, supporting higher free cash flow.
The stock looks undervalued at these levels, creating a compelling entry point for dividend investors.
New Campaign Invites Fans to Choose Between Camp Gooey and Camp Toasty This Summer
, /PRNewswire/ -- There are two kinds of people in this world when it comes to s'mores. Those who carefully rotate their marshmallow until it's perfectly golden, and those who light it on fire and call it a strategy. This summer, Hershey's is here to let America settle it once and for all.
Hershey's partner and s'mores icon Patrick Renna and son, Flynn Renna kick off Hershey's Heated Debate.
Introducing Hershey's Heated Debate. Are you Camp Gooey or Camp Toasty?
Hershey's partner and s'mores icon Patrick Renna and son, Flynn Renna, roasting the perfect s'mores together.
Source: The Hershey Company and independent research firm Reputation Leaders conducted a study of 5,000 U.S. adults aged 18-65, with 100 respondents per state. Fieldwork: April 3-27, 2026. State-level results are unweighted.
Introducing Hershey's Heated Debate, a summer-long campaign, in partnership with actor, creator, and s'mores icon Patrick Renna, that celebrates the ritual of making s'mores, the opinions it ignites, and the moments it creates. Because whether you're Camp Gooey or Camp Toasty, we can all agree on one thing: nothing makes a s'more like Hershey's milk chocolate.
To really get things bubbling, Hershey's issued the Hershey's S'mores Heated Debate Report, revealing that:
Over two thirds (69%) of s'mores eaters are Camp Toasty. These consumers want to see the outside completely toasted with 17% looking for some blackened char and 11% wanting the marshmallow on fire. One third (29%) of survey respondents are Camp Gooey with the majority prioritizing an ooey gooey center for the ultimate s'mores experience. 2% represent people who either don't want a marshmallow at all (1%) or those who say it "doesn't matter" (1%). "S'mores define summer, and Hershey's is the chocolate that people reach for to make them," said Vinny Rinaldi, VP, Consumer Connections at The Hershey Company. "Our focus is making this timeless ritual feel relevant and participatory, inviting more people to connect through a shared summer tradition."
Sparking a Nationwide Conversation
This summer, fans are encouraged to join the Hershey's Heated Debate and choose their side – Camp Gooey or Camp Toasty – and share it on Instagram and TikTok starting June 1 by tagging @hersheys and using the hashtag #campgooey or #camptoasty.
"Hershey's milk chocolate is non-negotiable in my house. It's the classic for a reason," said Patrick Renna. "And the marshmallow? That's where the family debate gets loud. Camp Gooey, Camp Toasty… everybody's got a take. But that's the best part: you're outside, you're laughing, and for a few minutes you're just together with sticky fingers, big smiles, and s'mores that taste like summer."
A Simple Ritual, A Real Connection
According to Hershey's S'mores Heated Debate Report, s'mores are a pillar of American summertime.
The U.S. consumes more than an estimated 2.5 billion s'mores annually.* 68% of s'mores eaters say it's not summer until you have had a s'more. 80% said s'mores are as American as apple pie. 40% of s'mores eaters only want "classic" s'mores. 43% of s'mores eaters consider themselves s'mores experts. 26% of s'mores eaters prefer their own method and wouldn't want someone else to make one for them. Extending the Momentum of Hershey's. It's Your Happy Place.
S'mores season is a signature way the "Hershey's. It's Your Happy Place." campaign comes to life through simple moments, shared rituals, and summer togetherness. 2026 marks Hershey's biggest year yet, with the brand showing up on the world's biggest stages and across key consumer moments, including the once-in-a-lifetime HERSHEY movie, in theaters Thanksgiving Day.
FAQs
What does the Hershey's s'mores campaign focus on?
Hershey's Heated Debate celebrates the small, shared moments that create lasting memories across generations and backyards – with Hershey's right at the center.
What is the "Camp Gooey vs. Camp Toasty" debate?
It is the classic question of how to toast a marshmallow – extra gooey, lightly golden or fully scorched. Hershey's S'mores Heated Debate Report says two-thirds (69%) of s'mores eaters like their s'mores toasty with 17% looking for some blackened char, and 11% wanting the marshmallow on fire.
What role does Patrick Renna play in bringing the debate to life?
Hershey's partnered with s'mores connoisseur, Patrick Renna to not only help launch the debate, but to bring s'mores-lovers together to share their sacred rituals, recipes and must-haves around the campfire.
How do I get involved in the Hershey's s'mores campaign?
Fans can join the conversation on Instagram and TikTok starting June 1 by sharing their s'mores style, tagging @hersheys and using the hashtag #campgooey or #camptoasty.
Why is Hershey's focusing on s'mores?
S'mores are a timeless summer ritual that naturally brings people together. It's the ritual that reconnects us – a simple, familiar act that bridges generations, revives old memories, and creates new ones.
What makes a s'more a s'more?
85% define s'mores as a classic recipe (graham cracker + marshmallow + chocolate), and 95% think that Hershey's belongs in a classic s'more.
Are there new ways to enjoy Hershey's in s'mores?
Yes. Fans can try variations like Hershey's milk chocolate with Caramel or experiment with new ingredients. Results from Hershey's S'mores Heated Debate Report finds that 47% of s'mores eaters categorize themselves as "experimenters," trying salty and sweet ingredients like bacon, pickles or fruit.
What is Hershey's. It's Your Happy Place campaign?
Hershey's. It's Your Happy Place. is Hershey's first major creative campaign in eight years, which launched ahead of the Olympic and Paralympic Winter Games Milano Cortina 2026. Hershey's. It's Your Happy Place. reinforces Hershey's enduring role as an iconic part of everyday moments and a familiar source of happiness.
About The Hershey Company
The Hershey Company is an industry-leading snacks company with a purpose to make more moments of goodness and a vision to lead next generation snacking. Hershey brings together more than 20,000 employees worldwide to deliver delicious, high-quality products across more than 85 brands in approximately 65 countries, generating more than $11.7 billion in annual revenues.
Hershey brings its full portfolio to market as ONE Hershey, spanning confection, salty and functional snacking categories with beloved brands like Hershey's, Reese's, Kisses, KIT KAT®, Jolly Rancher, Twizzlers and Ice Breakers; salty snacks including SkinnyPop, LesserEvil, Pirate's Booty and Dot's Homestyle Pretzels; and a protein portfolio including ONE Brands and Fulfil.
For more than 130 years, Hershey has operated fairly, ethically and sustainably. Founder Milton Hershey established Milton Hershey School in 1909, and that legacy of purpose endures today through the company's commitment to helping children succeed through equitable access to education.
Pricing is at the sole discretion of the retailer.
About The Study
The Hershey Company and independent research firm Reputation Leaders and MSL conducted a study by among 5,000 U.S. adults aged 18–65, with 100 respondents in each of the 50 U.S. states. The online survey was conducted between April 3 - 27, 2026. State-level findings are reported on an unweighted basis. For national projections of U.S. s'mores consumption, results were weighted to reflect gender, region, and state-level age profiles. Where findings relate to children aged 0–17, responses were provided by parents on behalf of their children and used to estimate consumption among this age group.
Hershey (HSY - Free Report) closed at $184.58 in the latest trading session, marking a +1.02% move from the prior day. The stock's change was more than the S&P 500's daily loss of 2.65%. Elsewhere, the Dow saw a downswing of 1.35%, while the tech-heavy Nasdaq depreciated by 4.18%.
Heading into today, shares of the chocolate bar and candy maker had lost 2.33% over the past month, lagging the Consumer Staples sector's loss of 0.58% and the S&P 500's gain of 5.47%.
Investors will be eagerly watching for the performance of Hershey in its upcoming earnings disclosure. The company is predicted to post an EPS of $1.44, indicating a 19.01% growth compared to the equivalent quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $2.66 billion, indicating a 1.87% upward movement from the same quarter last year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $8.45 per share and revenue of $12.25 billion, which would represent changes of +33.91% and +4.81%, respectively, from the prior year.
It's also important for investors to be aware of any recent modifications to analyst estimates for Hershey. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Hershey presently features a Zacks Rank of #3 (Hold).
With respect to valuation, Hershey is currently being traded at a Forward P/E ratio of 21.61. This denotes a premium relative to the industry average Forward P/E of 20.28.
It is also worth noting that HSY currently has a PEG ratio of 1.1. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The average PEG ratio for the Food - Confectionery industry stood at 1.1 at the close of the market yesterday.
The Food - Confectionery industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 188, putting it in the bottom 23% of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
Hershey is analyzed through its income statement, balance sheet, cash flow, and dividend history, highlighting fundamental financial health. Valuation metrics from Seeking Alpha are compared against Hershey's historical and peer benchmarks to assess current investment attractiveness. U.S. consumer sentiment data is integrated to contextualize demand drivers and potential headwinds for HSY's core business.
Hershey (HSY - Free Report) closed the most recent trading day at $180.84, moving +2.4% from the previous trading session. This change outpaced the S&P 500's 1.75% gain on the day. Elsewhere, the Dow saw an upswing of 1.86%, while the tech-heavy Nasdaq appreciated by 2.54%.
The chocolate bar and candy maker's stock has dropped by 9.74% in the past month, falling short of the Consumer Staples sector's gain of 1.72% and the S&P 500's loss of 1.63%.
Analysts and investors alike will be keeping a close eye on the performance of Hershey in its upcoming earnings disclosure. It is anticipated that the company will report an EPS of $1.46, marking a 20.66% rise compared to the same quarter of the previous year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.66 billion, up 1.87% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $8.45 per share and revenue of $12.28 billion, which would represent changes of +33.91% and +5.05%, respectively, from the prior year.
Investors should also pay attention to any latest changes in analyst estimates for Hershey. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.06% lower within the past month. Currently, Hershey is carrying a Zacks Rank of #3 (Hold).
From a valuation perspective, Hershey is currently exchanging hands at a Forward P/E ratio of 20.9. For comparison, its industry has an average Forward P/E of 19.72, which means Hershey is trading at a premium to the group.
It's also important to note that HSY currently trades at a PEG ratio of 1.06. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Food - Confectionery industry currently had an average PEG ratio of 1.06 as of yesterday's close.
The Food - Confectionery industry is part of the Consumer Staples sector. At present, this industry carries a Zacks Industry Rank of 112, placing it within the top 46% of over 250 industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
The death crosses flashing on both Hershey (NYSE: HSY | HSY Price Prediction) and Vertex Pharmaceuticals (NASDAQ: VRTX) are a bearish technical signal that Wall Street is openly ignoring. Analyst consensus on both stocks is solidly bullish, with double-digit implied upside to consensus targets, and the institutional bid keeps appearing even as the 50-day moving averages drift below the 200-day lines.
What the Smart Money Actually Thinks of Hershey Let’s start with Hershey. The stock closed at $180.84 on June 11, 2026, while the consensus analyst target price is $217.14. The ratings skew cautiously positive. Critically, the death cross itself is razor-thin, with the 50-day moving average at $193.09 versus the 200-day at $193.97. That is a separation of less than a dollar on a stock trading in the $180s. The signal is mechanically valid but informationally weak.
The fundamentals behind the analyst optimism are concrete. Hershey delivered Q1 FY2026 adjusted EPS of $2.35, a 14.67% beat over the $2.05 estimate. Revenue totaled $3.10 billion after growing 10.65% year over year. Management reaffirmed FY2026 guidance for adjusted EPS of $8.20 to $8.52, implying low-double-digit growth for the full year. At a forward P/E of 21 and a trailing P/E of 33, the market is already pricing in earnings normalization. The 3.2% dividend yield and beta of 0.081 make this one of the lowest-volatility names in consumer defensive coverage.
Vertex Offers an Even Louder Buy Signal Vertex Pharmaceuticals presents an even more lopsided picture. The consensus target price is $548.69, versus a closing price of $445.04 on June 11, 2026. The rating split is overwhelmingly bullish, and the death cross is similarly cosmetic, with the 50-day moving average at $436.72 against the 200-day at $437.41. Meanwhile, the stock has been recovering, up fractionally over the past week and 2.1% on the most recent session. The slower 200-day line is catching down to a stock that has already started repairing.
Earnings momentum supports the consensus. Vertex posted Q1 2026 non-GAAP EPS of $4.47 against a $4.31 estimate, with operating income up 80.62% year over year. Non-CF products contributed more than 25% of quarterly growth, validating the diversification thesis. Cash reached $7.247 billion, up 55.02% year over year. The povetacicept BLA for IgA nephropathy is moving through a Priority Review Voucher, six-month expedited review, a near-term regulatory catalyst the technicals do not reflect.
The Disconnect Between Price and Thesis The key question for retail investors is what to do when a lagging signal disagrees with a forward-looking consensus. On Hershey, the implied move to the analyst target is material, and the name trades well below its 52-week high of $239.48. On Vertex, the same gap is wider still, and the stock trades well below its 52-week high of $507.92. Institutional ownership of 88% for Hershey and 98% for Vertex indicates that professional investors have not been exiting their positions in any significant size.
The Takeaway A death cross describes price behavior that has already occurred. The Wall Street view, supported by earnings beats, reaffirmed guidance, and active pipeline catalysts, suggests the technical signal is late and marginal in both cases. The smart money is positioned for mean reversion higher, not continuation lower.
Risk remains: a fresh negative catalyst extends the downtrend on either name, and consensus targets are projections, not promises. But on the weight of evidence currently available, the bearish chart pattern is the noisier signal, and the bullish analyst consensus is the cleaner one.
Model-based digital twin capability of Vertiv™ SmartRun helps accelerate AI factory design, simulation, and deployment workflows
, /PRNewswire/ -- Vertiv (NYSE: VRT), a global leader in critical digital infrastructure, today announced progress on a production-grade digital twin capability for Vertiv™ SmartRun integrated in the NVIDIA Omniverse DSX Blueprint, advancing the company's roadmap to make AI factory infrastructure more configurable, repeatable, and simulation-ready.
Vertiv SmartRun overhead converged physical infrastructure system is integrated as a configurable digital twin within NVIDIA Omniverse DSX Blueprint workflows, enabling infrastructure to be designed, simulated, and validated as a single system before build-out. As AI deployments scale to higher densities and larger capacities, data centers need a faster, more reliable way to turn each generation of computing into real-world infrastructure. Traditional, document-based processes and siloed handoffs across power, cooling, controls, and deployment teams can't keep pace. Vertiv SmartRun digital twin shifts planning to a model-based approach, allowing infrastructure to be designed, simulated, and validated as a single system before build-out. By capturing system configurations and dependencies in a virtual environment, it helps reduce late-stage design changes and integration risk, improve confidence through simulation, and accelerate time from planning to operational readiness—while improving coordination across teams.
"AI infrastructure can no longer be planned one compute generation at a time," said Scott Armul, chief product and technology officer at Vertiv. "To deliver more tokens per second per megawatt, customers need power, cooling, controls, and deployment workflows to be designed as one interdependent system. The Vertiv SmartRun digital twin helps encode Vertiv's infrastructure expertise into configurable, simulation-ready building blocks that support faster, more confident AI factory planning. As we extend this approach to Vertiv™ OneCore Rubin DSX, Vertiv is helping customers translate future compute requirements into deployable physical infrastructure before those requirements reach full deployment scale."
The Vertiv SmartRun digital twin is the first phase in Vertiv's multi-phase AI factory digital twin roadmap. Digital twins are designed to help close the gap between accelerated compute innovation and physical infrastructure readiness, preserving engineering intent from early configuration and simulation through deployment, commissioning, lifecycle assurance, and future optimization.
"AI factories require full-stack co-design across compute and physical infrastructure," said Vladimir Troy, vice president of AI Infrastructure at NVIDIA. "NVIDIA Omniverse DSX Blueprint helps the ecosystem build, simulate, and optimize gigawatt-scale AI factory digital twins using OpenUSD, SimReady assets, and power, thermal, and operational simulations. Bringing Vertiv SmartRun into this workflow can help customers evaluate infrastructure choices earlier and prepare for multiple generations of accelerated computing."
At Computex Taipei 2026, Vertiv will demonstrate Vertiv™ SmartRun as both a physical infrastructure system and a configurable digital twin, allowing attendees to explore configuration scenarios and see how model-based design choices can support downstream infrastructure planning, coordination, and simulation workflows. Created using Dassault Systèmes model-based systems engineering capabilities on the 3DEXPERIENCE platform and connected to NVIDIA Omniverse DSX workflows, the demonstrator establishes a shared digital foundation for configuration, simulation, validation, and future optimization across the AI factory infrastructure lifecycle.
"Digital twins allow complex infrastructure systems to be represented with the intelligence of their configuration rules, dependencies, and engineering intent," said Stéphane Sireau, vice president of high tech industry at Dassault Systèmes. "At Computex, Vertiv, Dassault and NVIDIA demonstrate how Vertiv's AI factory infrastructure is moving from document-based design workflows toward an industrialized, model-based systems engineering approach optimized for speed, quality, and system-level performance."
See the video "Simulation-ready converged physical infrastructure for AI at scale" to learn more about leveraging digital twin for Vertiv's solutions for AI infrastructure, or visit Vertiv.com.
About Vertiv
Vertiv (NYSE: VRT) brings together hardware, software, analytics and ongoing services to enable its customers' vital applications to run continuously, perform optimally and grow with their business needs. Vertiv solves the most important challenges facing today's data centers, communication networks and commercial and industrial facilities with a portfolio of power, cooling and IT infrastructure solutions and services that extends from the cloud to the edge of the network. Headquartered in Westerville, Ohio, USA, Vertiv does business in more than 130 countries. For more information, and for the latest news and content from Vertiv, visit Vertiv.com.
Forward-looking statements
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27 of the Securities Act, and Section 21E of the Securities Exchange Act. These statements are only a prediction. Actual events or results may differ materially from those in the forward-looking statements set forth herein. Readers are referred to Vertiv's filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q for a discussion of these and other important risk factors concerning Vertiv and its operations. Vertiv is under no obligation to, and expressly disclaims any obligation to, update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.
Key Takeaways VRT posted a 20.8% adjusted operating margin in Q1 2026, up 430 basis points year over year. VRT raised its 2026 guidance and expects a 23.3% adjusted operating margin for the full year. VRT faces growing AI infrastructure competition from Amphenol and Super Micro Computer. Vertiv (VRT - Free Report) is benefiting from a significant expansion in its operating margins, driven by a combination of robust organic sales growth, operational leverage, disciplined cost management, and favorable price-cost execution.
In the first quarter of 2026, Vertiv reported an adjusted operating margin of 20.8%, which was up 430 basis points year over year and 180 basis points above guidance. This margin expansion was supported by strong top-line growth, particularly in the Americas, where organic sales surged 44%. The company’s ability to capitalize on the accelerating demand for data center infrastructure, especially in AI and cloud deployments, has been a key factor in this performance.
Vertiv’s expanding portfolio and acquisitions are also contributing to margin stability and growth. Strategic acquisitions, such as PurgeRite, have strengthened Vertiv’s liquid cooling and system-level service offerings, which are critical for modern data centers. The integration of solutions like SmartRun and OneCore enables the company to deliver converged, prefabricated systems at scale, supporting higher margins and differentiating the company from competitors.
Vertiv remains confident in the persistence of strong operating margins. For the second quarter of 2026, management expects operating margin to be in the range of 20.7%-21.7%. The company anticipates offsetting unfavorable tariff impacts through pricing and operational actions materially.
Vertiv’s management has raised 2026 guidance. The company now expects an adjusted operating margin of 23.3%, representing a 290-basis-point expansion from 2025. This outlook is supported by continued robust demand, especially in the Americas and APAC regions and a recovering EMEA market. While there may be short-term fluctuations, such as a slight dip in the second-quarter margins due to capacity ramp-up and tariff adjustments, Vertiv expects overall incremental margins in the range of 30% to 35% for 2026.
VRT Suffers From Stiff CompetitionVertiv’s AI infrastructure solutions are facing increasing competition from Amphenol (APH - Free Report) and Super Micro Computer (SMCI - Free Report) . Both Amphenol and Super Micro Computer are expanding their offerings to support high-density, AI-driven data center deployments.
Amphenol is benefiting from a significant expansion in its operating margins. In the first quarter of 2026, the company reported an adjusted operating margin of 27.3%, which marks a robust increase of 380 basis points from the prior year, driven by robust operating leverage on significantly higher sales volumes. A major factor behind this margin expansion is Amphenol’s broad-based growth across diverse end markets. The IT datacom segment, fueled by surging AI investments, accounted for more than 40% of sales and grew organically by 81%.
Super Micro Computer is evolving from just a server and hardware vendor into a full IT solutions provider. Products like DCBBS (Data Center Building Block Solutions) bundle hardware, software, cooling, networking, and support into complete systems. This strategy increases revenue per deal and improves margins. In the third quarter of fiscal 2026, Super Micro Computer’s non-GAAP operating margin improved to 7.3% from 4.5% in the previous quarter.
Vertiv’s Share Price Performance, Valuation, and EstimatesVRT’s shares have surged 94.8% in the year-to-date period compared with the broader Zacks Computer & Technology sector's rise of 21.3%. The Zacks Computers - IT Services industry declined 14.8% in the same time frame.
VRT Stock Performance
Image Source: Zacks Investment Research
Vertiv stock is trading at a premium, with a trailing 12-month Price/Book of 28.57X compared with the Computer and Technology sector’s 10.44X. VRT has a Value Score of D.
VRT Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for 2026 earnings is pegged at $6.36 per share, which has decreased 0.93% over the past 30 days. This indicates a 51.43% increase from the reported figure of 2025.
Vertiv currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Vertiv Holdings Co. (VRT - Free Report) has been one of the most searched-for stocks on Zacks.com lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term.
Shares of this company have returned -2.3% over the past month versus the Zacks S&P 500 composite's +6.3% change. The Zacks Computers - IT Services industry, to which Vertiv belongs, has gained 11.9% over this period. Now the key question is: Where could the stock be headed in the near term?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
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.
We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For the current quarter, Vertiv is expected to post earnings of $1.42 per share, indicating a change of +49.5% from the year-ago quarter. The Zacks Consensus Estimate has changed -0.5% over the last 30 days.
For the current fiscal year, the consensus earnings estimate of $6.36 points to a change of +51.4% from the prior year. Over the last 30 days, this estimate has changed -0.9%.
For the next fiscal year, the consensus earnings estimate of $8.43 indicates a change of +32.4% from what Vertiv is expected to report a year ago. Over the past month, the estimate has changed -1.7%.
Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, Vertiv is rated Zacks Rank #2 (Buy).
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Revenue Growth ForecastEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
For Vertiv, the consensus sales estimate for the current quarter of $3.37 billion indicates a year-over-year change of +27.7%. For the current and next fiscal years, $13.75 billion and $17.56 billion estimates indicate +34.4% and +27.8% changes, respectively.
Last Reported Results and Surprise HistoryVertiv reported revenues of $2.65 billion in the last reported quarter, representing a year-over-year change of +30.1%. EPS of $1.17 for the same period compares with $0.64 a year ago.
Compared to the Zacks Consensus Estimate of $2.66 billion, the reported revenues represent a surprise of -0.27%. The EPS surprise was +14.71%.
The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates three times over this period.
ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.
Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Vertiv is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
ConclusionThe 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 Vertiv. However, its Zacks Rank #2 does suggest that it may outperform the broader market in the near term.
, /PRNewswire/ -- Vertiv Holdings Co (NYSE: VRT), a global leader in critical digital infrastructure, today announced that its Board of Directors has declared a quarterly cash dividend of $0.0625 per share of the company's Class A common stock. The cash dividend will be payable on June 25, 2026, to shareholders of record of Class A common stock at the close of business on June 15, 2026.
About Vertiv Holdings Co
Vertiv (NYSE: VRT) brings together hardware, software, analytics and ongoing services to enable its customers' vital applications to run continuously, perform optimally and grow with their business needs. Vertiv solves the most important challenges facing today's data centers, communication networks and commercial and industrial facilities with a portfolio of power, cooling and IT infrastructure solutions and services that extends from the cloud to the edge of the network. Headquartered in Westerville, Ohio, USA, Vertiv does business in more than 130 countries. For more information, and for the latest news and content from Vertiv, visit vertiv.com.
Category: Financial News
For investor inquiries, please contact:
Lynne Maxeiner
Vice President, Global Treasury & Investor Relations
Vertiv
E: [email protected]
For media inquiries, please contact:
Ruder Finn for Vertiv
E: [email protected]
The Vertiv™ PurgeRite™ NearZero™ service combines engineered mechanical flushing, water recycling, treatment, and continuous monitoring to support cleaner closed-loop hydronic systems
, /PRNewswire/ -- Vertiv (NYSE: VRT), a global leader in critical digital infrastructure, today introduced the Vertiv™ PurgeRite™ NearZero™, a fluid management service designed to reduce the water, wastewater, and hauling requirements associated with commissioning closed-loop hydronic systems in data centers and other mission-critical environments in North America.
Vertiv™ PurgeRite™ NearZero™ helps reduce water consumption, wastewater generation, and hauling needs during data center commissioning by combining engineered flushing, water treatment, and closed-loop recycling. As AI and high-density deployments increase the complexity of primary and secondary fluid networks, data center operators face growing challenges related to water sourcing, discharge restrictions, system cleanliness, and commissioning predictability. Building on PurgeRite's specialized expertise in mechanical flushing, purging, filtration, and fluid-system commissioning, Vertiv is expanding its services portfolio to help customers address these challenges while supporting reliable system startup.
The patent-pending Vertiv PurgeRite NearZero service combines engineered flush-planning, mechanical flushing, water treatment, filtration, reverse osmosis, and continuous water-quality monitoring to recycle flushing water throughout the commissioning process. This approach helps minimize the volume of water that must be sourced, hauled, discharged, or disposed of while supporting cleanliness and passivation requirements for closed-loop hydronic systems.
"As data centers move to higher-density architectures, fluid networks are becoming more critical to deployment speed, system cleanliness, and long-term reliability," said Ron Bednar, senior vice president of services, Americas at Vertiv. "Vertiv PurgeRite NearZero helps customers limit water consumption, wastewater handling, and hauling complexity during commissioning while supporting the reliability required to bring mission-critical cooling systems online with confidence."
In selected deployments, Vertiv PurgeRite NearZero has reduced total water consumption by up to 78%, water haul-off volumes by up to 91%, and discharge management costs by as much as 34% compared with conventional commissioning approaches. The process has also reduced water delivery and removal requirements by approximately 300 tanker trips at one site, also helping decrease truck traffic, fuel use, and emissions associated with transportation. Actual results vary by site and project conditions, including incoming water quality, system contaminant levels, local hauling and disposal requirements, discharge regulations, and transportation logistics.
Vertiv™ PurgeRite™ NearZero™ complements Vertiv's portfolio of fluid management and thermal management offerings designed to support hyperscale, colocation, and enterprise data center environments by combining water treatment, filtration, and engineered commissioning services into a single coordinated solution.
To learn more about Vertiv's end-to-end portfolio of power, thermal, and fluid management solutions that support data centers and other mission-critical environments, visit Vertiv.com.
About Vertiv
Vertiv (NYSE: VRT) brings together hardware, software, analytics and ongoing services to enable its customers' vital applications to run continuously, perform optimally and grow with their business needs. Vertiv solves the most important challenges facing today's data centers, communication networks and commercial and industrial facilities with a portfolio of power, cooling and IT infrastructure solutions and services that extends from the cloud to the edge of the network. Headquartered in Westerville, Ohio, USA, Vertiv does business in more than 130 countries. For more information, and for the latest news and content from Vertiv, visit Vertiv.com.
Forward-looking statements
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27 of the Securities Act, and Section 21E of the Securities Exchange Act. These statements are only a prediction. Actual events or results may differ materially from those in the forward-looking statements set forth herein. Readers are referred to Vertiv's filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q for a discussion of these and other important risk factors concerning Vertiv and its operations. Vertiv is under no obligation to, and expressly disclaims any obligation to, update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.
Key Takeaways Vertiv shares rose 33.2% in three months, outperforming peers and its broader industry. VRT expanded NVIDIA partnerships with AI factory digital twin and infrastructure solutions. VRT expects Q2 revenues in the range of $3.25B-$3.45B and organic sales growth of 20%-24%. Vertiv (VRT - Free Report) shares have rallied 33.2% in the past three-month period compared with the broader Zacks Computer & Technology sector’s rise of 26.8%. The Zacks Computers - IT Services industry increased 4% over the same period.
Vertiv’s shares have also outperformed its peers, which include Amphenol (APH - Free Report) and Teradyne (TER - Free Report) . Both Amphenol and Teradyne are expanding their capabilities in the AI and data center infrastructure markets. Shares of Amphenol and Teradyne have rallied 11.8% and 28.7%, respectively, in the past three-month period.
The outperformance of VRT stock can be attributed to its rich partner base and extensive product portfolio spanning thermal systems, liquid cooling, UPS, switchgear, busbars, and modular solutions. Vertiv remains leveraged to rising data center power and thermal needs as AI deployments drive higher infrastructure density and faster build cycles.
VRT Stock's Performance
Image Source: Zacks Investment Research
VRT Benefits From Expanding NVIDIA PartnershipVertiv’s partnership with NVIDIA (NVDA - Free Report) has been noteworthy. The company recently introduced the first converged physical infrastructure digital twin for NVIDIA Omniverse DSX. This solution integrates its SmartRun platform into NVIDIA’s AI factory design environment.
The company allows data center operators to model, simulate, and validate power, cooling, and infrastructure systems as a single digital replica before deploying them. The digital twin reduces design changes, lowers integration risks, improves collaboration among teams and speeds up AI factory deployment by shifting from traditional document-based planning to a model-based approach. This launch is the first step in Vertiv’s larger plan to create scalable, simulation-ready infrastructure for next-generation AI factories.
Further expanding its portfolio in March 2026, Vertiv announced its partnership with NVIDIA to improve the combined physical infrastructure for AI factories. This will be done through DSX SimReady digital power and cooling assets, standardized 12.5MW modular building blocks, Vertiv OneCore and system-level designs that integrate power, cooling and controls. The goal is to reduce deployment complexity, speed up readiness, improve scalability and enable digitally validated, high-performance AI infrastructure from the grid to the chip level.
Vertiv Rides on Strong Operating Margin ExpansionVertiv is benefiting from a significant expansion in its operating margins, driven by a combination of robust organic sales growth, operational leverage, disciplined cost management and favorable price-cost execution.
In the first quarter of 2026, Vertiv reported an adjusted operating margin of 20.8%, which increased 430 basis points year over year and 180 basis points above guidance. The company’s ability to capitalize on the accelerating demand for data center infrastructure, especially in AI and cloud deployments, has been a key factor in this performance.
Vertiv’s expanding portfolio and acquisitions are also contributing to margin stability and growth. Strategic acquisitions, such as PurgeRite, have strengthened Vertiv’s liquid cooling and system-level service offerings, which are critical for modern data centers. The integration of solutions like SmartRun and OneCore enables the company to deliver converged, prefabricated systems at scale, supporting higher margins and differentiating the company from competitors.
VRT Initiates Positive 2Q26 GuidanceVertiv is benefiting from its strong portfolio and rich partner base, which will continue to benefit the company’s top-line growth.
For the second quarter of 2026, revenues are expected to be between $3.25 billion and $3.45 billion. Organic net sales are expected to increase in the range of 20% to 24%. The Zacks Consensus Estimate for Vertiv’s second-quarter 2026 revenues is pegged at $3.37 billion, suggesting growth of 27.69% year over year.
VRT expects second-quarter 2026 non-GAAP earnings per share between $1.37 and $1.43 per share. The Zacks Consensus Estimate for second-quarter 2026 earnings is currently pegged at $1.42 per share, which declined by a penny over the past 30 days. The figure indicates a year-over-year increase of 49.47%.
Vertiv Stock Is Trading at a PremiumVertiv is currently overvalued, as suggested by a Value Score of D.
In terms of the trailing 12-month Price/Book, Vertiv is currently trading at 30.27X compared with the broader Computer and Technology sector’s 10.63X.
VRT's Valuation
Image Source: Zacks Investment Research
ConclusionVertiv is benefiting from its strong portfolio and rich partner base, which are driving order growth. These factors justify the company’s premium valuation.
Vertiv stock currently carries a Zacks Rank #2 (Buy) and has a Growth Score of A, a favorable combination that offers a strong investment opportunity, per the Zacks Proprietary methodology. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Founder's ClubSwingTraderLeaderboardMarketSurgeeIBDIBD DigitalIBD LiveCustomer Center
My Stock Lists
Email Preferences
Help & Support
Sign Out
Search stocks or keywords
Sections
My IBD
MARKET TREND
STOCK LISTS
STOCK RESEARCH
NEWSECONOMY
VIDEOS & PODCASTS
HOW TO INVESTEDUCATIONAL RESOURCESStoreMy Products
Founder's ClubSwingTraderLeaderboardMarketSurgeeIBDIBD DigitalIBD Live
Recently Searched
Travere Stock At 20-Year High, Leads 21 Newcomers To Best Stock Lists Like Big Cap 20
Stock Market Finds Rocket Fuel From Trump Canceling Iran Strikes; SpaceX Debut On Deck
Two AI Titans Flash Entries As Rocket Lab Readies For Launch Vertiv (VRT) stock is among the leaders of the artificial intelligence trade this year, as it was in 2025. Shares hit an all-time high of 379.94 in May and are testing their 50-day moving average after a pullback. Through Friday morning, gains amounted to about 90% year to date. The maker of critical products for data centers holds a spot…
Lasers that can shoot down drones. Data center infrastructure powering artificial intelligence. Trade schools training the next generation of electricians and welders.
These might not seem like the usual ingredients of a top-performing mutual fund, but they’ve helped propel the $2.3 billion (assets) Needham Aggressive Growth Fund (NEAGX) to a 94% return over the past year and a 58% gain so far in 2026, far outpacing both the S&P 500 and Russell 2000.
Portfolio manager John Barr has built that track record by investing in what he describes as the “picks and shovels” of the new economy: small-cap companies building the infrastructure behind everything from artificial intelligence to modern warfare. He calls them “hidden compounders.”
The bet is simple: instead of chasing the companies everyone already knows, Barr is investing in the ones making them possible.
Barr, who has run the fund since 2010, spent 14 years in the semiconductor industry before moving to Wall Street as an analyst and later a portfolio manager. That background helps explain his focus on underfollowed companies with an established core business that are quietly investing in a new product or service the market doesn’t yet fully appreciate. “The market rarely looks beyond 12 to 18 months,” he says. “We’re trying to look much further out than that.”’
Take the case of Barr’s largest holding, nLight (LASR), a Camas, Washington-based company that produces high-powered lasers to shoot down drones. Originally focused on industrial uses like cutting and welding, it has spent years investing in directed-energy systems for defense.
Barr began building a position five to six years ago, drawn to the company’s founder-led management and the potential upside from its pivot into defense. At the time, the market largely viewed nLight as an industrial business. Today, growing concerns around drone incursions—from military use to commercial airspace—have helped bring that opportunity into focus. Last year nLight had $261 million in revenue with a net loss of $23 million, though Barr expects the company will soon become profitable. Its stock has risen 97% so far in 2026 and currently trades at $75 per share.
“It had an established business that gave us a margin of safety,” says Barr. “The upside was in something the market didn’t yet appreciate.”
Barr investment selection process starts by identifying smaller companies with a stable legacy business and a potential new growth engine. Positions begin small. As those bets begin to work, he adds to them during a “transition” phase, before ultimately holding onto the winners for years as they evolve into what he considers “quality compounders.”
The strategy requires patience. Barr’s average holding period is roughly a decade, and Morningstar lists turnover at about 16%, far lower than most growth strategies. Early-stage bets are sized modestly to limit downside, while successful investments are allowed to grow into larger positions over time.
That discipline has produced a handful of massive winners. Barr’s fund holds just over 100 stocks, but he estimates that roughly 20 investments over his tenure have generated returns of five times or more, with some delivering gains of 10 times, 50 times or higher. A relatively small group of long-term holdings has driven the bulk of the fund’s outperformance.
More recently, where Barr has applied that process has mattered just as much as how. He has leaned heavily into what he sees as the backbone of the next economic cycle: infrastructure, broadly defined. That includes semiconductor manufacturing, data centers, defense technologies and the skilled labor required to build and maintain it all.
That positioning paid off in early 2026. Eight of Barr’s ten largest holdings were also among the fund’s top contributors in the first quarter, including nLight, Vertiv Holdings, Vicor, Lincoln Educational Services and Universal Technical Institute. nLight has risen 97%, Vicor 170%, Vertiv 82%, Lincoln Educational Services 120%, UTI 83% and PDF Solutions 92% so far this year.
Ohio-based Vertiv Holdings (VRT) provides power and cooling equipment for data centers. It has annual revenue of over $10 billion and posted net profits of $1.3 billion last year. Barr initially bought shares after the company went public via a SPAC, attracted by its exposure to the growing demand for digital infrastructure.
The investment was volatile early on. Inflation and pricing pressures hit margins, sending the stock sharply lower. Barr used the pullback to build his position, betting that management could fix operational issues over time. As demand for data centers surged—driven in part by artificial intelligence—Vertiv rebounded and became one of the fund’s largest holdings.
Barr’s background covering semiconductors has also led him to companies like California-based PDF Solutions (PDFS), a lesser-known firm that provides data analytics and software to chip manufacturers. The company recorded $219 million in sales last year, while posting a small profit loss after two prior years of profitability. Its tools help improve yields and efficiency in chip production, which is an increasingly critical function as manufacturing becomes more complex.
The company has been a long-term holding and is part of Barr’s “super seven,” his internal nickname for seven stocks that have generated a disproportionate share of the fund’s returns. Its close ties to major industry players, including Intel, position it to benefit from efforts to expand domestic chip manufacturing.
Not all of Barr’s investments are tied directly to high-tech industries. One of his more unconventional bets is Chicago, Illinois-based Oil-Dri Corporation of America (ODC), a niche business that mines and processes clay used in products ranging from cat litter to industrial filtration. The company made $485 million in revenue last year with net profits of $54 million.
Barr was drawn to the company’s unique assets and long-term investments in new applications. Over time, Oil-Dri has expanded into areas like lightweight cat litter and animal health products, where its materials can be used to improve livestock nutrition and reduce reliance on antibiotics. The stock took years to gain traction, but more recently those investments have begun to pay off. The company also has little to no Wall Street coverage, which is something Barr views as an advantage.
“If no one’s looking at it, that’s often where the opportunity is,” he says.
Another piece of Barr’s broader theme is New Jersey-based Lincoln Educational Services (LINC), which operates vocational schools focused on training workers in fields like HVAC, electrical work and welding. Revenue grew 20% last year to $518 million, while net profits doubled to $20 million. As demand for infrastructure projects and manufacturing grows, Barr sees a shortage of skilled labor that companies like Lincoln are positioned to help address.
“None of this works without labor,” says Barr.
The common thread across these investments is that they sit behind larger, more visible trends. Rather than betting on the winners everyone can see, Barr is focused on the companies enabling them. That includes the infrastructure powering AI, the technologies reshaping defense or the workforce needed to support it all.
Not every bet works. Barr points to KVH Industries, which makes satellite communication systems for ships. Today the company makes $100 million in annual revenue with a net loss of nearly $10 million. When Barr first invested in 2013, he believed the company could expand into content and become a kind of “Netflix of the seas,” but that strategy never fully materialized—especially as new competitors like Starlink reshaped the market. While KVH survived and restructured under new leadership, the stock remains below where Barr originally purchased it more than a decade ago.
In another case, Canadian firm DIRTT Environmental Solutions, which makes prefabricated office interiors, struggled after its founder clashed with the board and was eventually pushed out. The business was further hit when construction activity collapsed during the pandemic. Barr exited after the turnaround failed to take hold. He had purchased the stock in 2017 at roughly $4 per share, today it trades for 50 cents a share.
Those missteps, however, have generally been contained. Because early-stage positions are kept small, losses tend to be limited. Over time, the outsized gains from a handful of winners have more than made up for the misses.
Barr also resists the temptation to sell those winners too early. “If you let the winners run, that’s where the returns come from,” he says.
More broadly, he sees small-cap investing as an area rich with opportunity especially as AI begins to transform seemingly mundane businesses.Fewer analysts and less coverage, he argues, create inefficiencies that disciplined investors can exploit.
“There’s just less attention on these companies,” says Barr. “If you do the work and take a long-term view, you can find some really interesting opportunities.”
More from ForbesForbesInside Dana White’s $60 Million Plan To Stage UFC Freedom 250 At The White HouseBy Matt CraigForbesWhy Pfizer And Eli Lilly Are Betting On This $1.3 Billion AI Drug Discovery StartupBy Amy FeldmanForbesCaryn Seidman Becker Bought Clear Out Of Bankruptcy. Now She’s A Billionaire.By Katharine Schwab
Vertiv stock pulled back to a historically bullish trendline
Vertiv Holdings Co (NYSE:VRT) shares were last seen down 1.4% at $296.67, poised to log their fourth loss in the last five sessions. Year-to-date, however, the equity is still boasting a 128% lead, and just came into contact with a historically bullish trendline.
According to Schaeffer's Senior Quantitative Analyst Rocky White, VRT is trading within 0.75 times the 80-day moving average's 20-day average true range (ATR), after spending at least 80% of the previous two weeks and 80% of the prior 42 trading sessions above that trendline. This setup has appeared eight times during the last decade. One month later, the stock was higher 88% of the time after these signals, averaging a 9.5% gain. A comparable rally from current levels would place Vertiv stock above $324.
Furthermore, the manufacturer sits on the cusp of "oversold" territory, per its 14-day relative strength index (RSI) of 31.
The SEC Moves to End the $25,000 Day Trading Barrier
For years, this rule kept most traders on the sidelines. Now, the door is opening to a whole new wave of active traders.
Dynamite Day Trading Signals helps you hit the ground running with up 2 options trade alerts per week, built to capture fast-moving opportunities.
It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.
The popular research service can help you become a smarter, more self-assured investor, giving you access to daily updates of the Zacks Rank and Zacks Industry Rank, the Zacks #1 Rank List, Equity Research reports, and Premium stock screens.
Zacks Premium includes access to the Zacks Style Scores as well.
What are the Zacks Style Scores? The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.
Each stock is assigned a rating of A, B, C, D, or F based on their value, growth, and momentum characteristics. Just like in school, an A is better than a B, a B is better than a C, and so on -- that means the better the score, the better chance the stock will outperform.
The Style Scores are broken down into four categories:
Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.
Growth ScoreWhile good value is important, growth investors are more focused on a company's financial strength and health, and its future outlook. The Growth Style Score takes projected and historic earnings, sales, and cash flow into account to uncover stocks that will see long-term, sustainable growth.
Momentum ScoreMomentum traders and investors live by the saying "the trend is your friend." This investing style is all about taking advantage of upward or downward trends in a stock's price or earnings outlook. Employing factors like one-week price change and the monthly percentage change in earnings estimates, the Momentum Style Score can indicate favorable times to build a position in high-momentum stocks.
VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank A proprietary stock-rating model, the Zacks Rank utilizes the power of earnings estimate revisions, or changes to a company's earnings outlook, to help investors create a successful portfolio.
Investors can count on the Zacks Rank's success, with #1 (Strong Buy) stocks producing an unmatched +23.7% average annual return since 1988, more than double the S&P 500's performance. But the model rates a large number of stocks, and there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.
But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.
That's where the Style Scores come in.
To have the best chance of big returns, you'll want to always consider stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B, which will give you the highest probability of success. If you're looking at stocks with a #3 (Hold) rank, it's important they have Scores of A or B as well to ensure as much upside potential as possible.
As mentioned above, the Scores are designed to work with the Zacks Rank, so any change to a company's earnings outlook should be a deciding factor when picking which stocks to buy.
Here's an example: a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one with Style Scores of A and B, still has a downward-trending earnings outlook, and a bigger chance its share price will decrease too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Vertiv Holdings Co. (VRT - Free Report) Vertiv is a leading global provider of critical digital infrastructure and services for data centers, communication networks, and commercial and industrial environments. Vertiv serves essential industries, including cloud computing, financial services, healthcare, transportation, manufacturing, energy, government, education, retail and social media.
VRT is a #2 (Buy) on the Zacks Rank, with a VGM Score of B.
Additionally, the company could be a top pick for growth investors. VRT has a Growth Style Score of A, forecasting year-over-year earnings growth of 51.4% for the current fiscal year.
Six analysts revised their earnings estimate higher in the last 60 days for fiscal 2026, while the Zacks Consensus Estimate has increased $0.18 to $6.36 per share. VRT also boasts an average earnings surprise of +14.7%.
With a solid Zacks Rank and top-tier Growth and VGM Style Scores, VRT should be on investors' short list.
Acquisition expected to strengthen thermal management capabilities and manufacturing capacity in Europe, Middle East and Africa to support high-density computing
, /PRNewswire/ -- Vertiv (NYSE: VRT), a global leader in critical digital infrastructure, today announced the completed acquisition of ThermoKey S.p.A., a leading provider of heat rejection and heat-exchange technologies with long-standing relationships across original equipment manufacturers (OEMs) and system integrators.
Vertiv announced the completed acquisition of ThermoKey, a leading heat rejection and heat-exchange technologies provider. The acquisition expands Vertiv's thermal management portfolio and manufacturing capabilities, particularly in Europe, Middle East, and Africa (EMEA), and strengthens its ability to deliver system-level solutions across the full thermal chain for AI factories and high-density data centers. ThermoKey benefits from Vertiv's global scale, supporting accelerated growth and expanded market access while enhancing Vertiv's ability to provide thermal architectures that help customers plan for multiple compute generations ahead.
Vertiv currently uses ThermoKey's technologies in select thermal solutions. ThermoKey's technology set includes heat-exchange solutions, dry coolers, and compatibility with low-GWP and natural refrigerants that complement Vertiv's portfolio, giving customers flexibility to optimize for performance, site conditions, and growth. Founded in 1991, ThermoKey brings more than 30 years of engineering expertise, in-house design and production capabilities to support its customers and markets.
"Customers are scaling AI infrastructure at an unprecedented pace, and thermal performance is now a critical enabler of capacity and efficiency," said Giordano Albertazzi, CEO at Vertiv. "With ThermoKey, we are strengthening our capabilities to deliver differentiated, integrated, high-performance heat rejection solutions that help customers deploy faster, operate more efficiently, and scale with confidence."
The ThermoKey Rivarotta, Italy, operations will continue to be a key hub for manufacturing, engineering, and support. Giuseppe Visentini, CEO of ThermoKey, will continue to lead the business, providing continuity for employees, partners, and customers. "Joining Vertiv means bringing our heat-exchange expertise into a complete, integrated thermal chain that serves high-density data centers," said Visentini. "We share Vertiv's engineering rigor and customer focus. ThermoKey joins Vertiv on a path of sustained growth, and from Italy we will continue to build on that momentum and contribute to the strength of the group across EMEA and around the world."
For more information on Vertiv's leading portfolio of power and thermal management, infrastructure solutions, IT systems, and services for critical digital applications, visit Vertiv.com.
About Vertiv
Vertiv (NYSE: VRT) brings together hardware, software, analytics and ongoing services to enable its customers' vital applications to run continuously, perform optimally and grow with their business needs. Vertiv solves the most important challenges facing today's data centers, communication networks and commercial and industrial facilities with a portfolio of power, cooling and IT infrastructure solutions and services that extends from the cloud to the edge of the network. Headquartered in Westerville, Ohio, USA, Vertiv does business in more than 130 countries. For more information, and for the latest news and content from Vertiv, visit Vertiv.com.
Category: Financial News
Forward-looking statements
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27 of the Securities Act, and Section 21E of the Securities Exchange Act. These statements are only a prediction. Actual events or results may differ materially from those in the forward-looking statements set forth herein. Readers are referred to Vertiv's filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q for a discussion of these and other important risk factors concerning Vertiv and its operations. Those risk factors and risks related to the transaction, among others, could cause actual results to differ materially from historical performance and include, but are not limited to: expected expenses related to the transaction; the possible diversion of management time on issues related to integration; the ability of Vertiv to maintain relationships with customers and suppliers of ThermoKey; and the ability of Vertiv to retain management and key employees of ThermoKey. Vertiv is under no obligation to, and expressly disclaims any obligation to, update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.
For investor inquiries, please contact:
Lynne Maxeiner
Vice President, Global Treasury & Investor Relations
Vertiv
E [email protected]
For media inquiries, please contact:
Ruder Finn for Vertiv
E [email protected]
Resources Investor Relations Journalists Agencies Client Login Send a Release News Products Contact , /PRNewswire/ -- IAC (NASDAQ: IAC) will participate in the Annual J.P. Morgan Global Technology, Media and Communications Conference on Tuesday, May 19, 2026. Christopher Halpin, Executive Vice President, COO and CFO of IAC and Tim Quinn, CFO of People Inc. will participate in a fireside chat at 2:55 p.m. ET. Both a live audio webcast and replay of the presentation will be available to the public in the IR section of IAC's website at https://ir.iac.com/events-and-presentations.
About IAC
IAC (NASDAQ: IAC) builds companies. We are guided by curiosity, a questioning of the status quo, and a desire to invent or acquire new products and brands. From the single seed that started as IAC nearly three decades ago have emerged 10 independent, publicly-traded companies and generations of exceptional leaders. We will always evolve, but our basic principles of financially-disciplined opportunism will never change. IAC today primarily comprises leading publisher People Inc. and its strategic equity positions in MGM Resorts International and Turo Inc. IAC is headquartered in New York City.
Resources Investor Relations Journalists Agencies Client Login Send a Release News Products Contact , /PRNewswire/ -- IAC (NASDAQ: IAC) will participate in the 54th Annual TD Cowen Technology, Media and Telecom Conference on Wednesday, May 27, 2026. Christopher Halpin, Executive Vice President, COO and CFO of IAC and Tim Quinn, CFO of People Inc. will participate in a fireside chat at 3:00 p.m. ET. Both a live audio webcast and replay of the fireside chat will be available to the public in the IR section of IAC's website at https://ir.iac.com/events-and-presentations.
About IAC
IAC (NASDAQ: IAC) builds companies. We are guided by curiosity, a questioning of the status quo, and a desire to invent or acquire new products and brands. From the single seed that started as IAC nearly three decades ago have emerged 10 independent, publicly-traded companies and generations of exceptional leaders. We will always evolve, but our basic principles of financially-disciplined opportunism will never change. IAC today primarily comprises leading publisher People Inc. and its strategic equity positions in MGM Resorts International and Turo Inc. IAC is headquartered in New York City.
4 Golden Crosses With Double-Digit Upside AheadIAC NASDAQ: IAC is continuing its transformation from a holding company into People Incorporated, with executives describing the shift as a continuation of a strategy outlined earlier this year that includes asset sales, cost reductions and a sharper focus on People Inc. and MGM Resorts International.
Speaking at a J.P. Morgan investor event, Chris said IAC’s consolidation of its corporate operations into People Inc. reflects the company’s narrowed operating structure after the spin of Angi, the sale of Care and the wind-down of its search business.
Get PPLI alerts:
“When you're down to one core operating business, a key step in this was selling Care and closing that in March, as well as winding down our search business and other things that simplified the drains on corporate,” Chris said. “It made no sense to have two levels of corporate for one operating business, plus our MGM stake, plus some smaller stakes.”
People Inc. Becomes the Core Operating Business Tim Quinn, CFO of People Incorporated, said People Inc. is “America’s largest publisher by pretty much any measure,” built from the combination of Dotdash, Time Inc. and Meredith. The company owns brands including People, Better Homes & Gardens, Food & Wine, Travel + Leisure, Southern Living and Allrecipes.
Quinn said 70% of People Inc.’s revenue is now digital media, while 90% of profitability comes from digital media. The magazine business remains, but he described it as a smaller portion of the overall company as brands now operate across websites, print, social platforms and Apple News.
People Inc. has continued to grow despite traffic headwinds from AI Overviews, Quinn said. He said the company began preparing for reduced reliance on Google traffic under an internal phrase called “Google Zero,” which asked where its brands would live if no traffic came from Google.
“For the last 10 years, it's been a digital dotcom business, and we think the next 10 years are gonna be all about the brands,” Quinn said.
Non-Session Revenue Drives Growth Quinn highlighted growth in “non-session-based” revenue, meaning revenue not tied to visits to People Inc.’s owned and operated websites. He said 41% of revenue is now non-session-based and that segment grew 24% in the first quarter. The remaining 60% of revenue, tied to website visits, was flat, producing 8% overall revenue growth in the quarter.
Key components of non-session revenue include:
Content distribution and syndication through platforms such as Apple News; Advertising extensions across social and other off-platform channels; D/Cipher, the company’s proprietary ad targeting capability; Events, sponsorships and other advertiser solutions; AI licensing agreements. Quinn said D/Cipher uses People Inc.’s first-party data and AI tools to extend advertising performance beyond the company’s owned sites. He said the off-platform application, called D/Cipher Plus, remains early but is expected to add 2 to 3 percentage points to growth in the back half of the year.
AI Licensing Seen as Opportunity Quinn said People Inc. has signed an “all you can eat” style licensing deal with OpenAI that allows the AI company to train on, display and use People Inc. content. He said People Inc. began blocking AI crawlers from companies without agreements about a year ago, using Cloudflare and other content delivery networks.
That move changed the negotiating dynamic, Quinn said, as real-time access to content became more important for AI companies and applications built on top of AI models.
Quinn said a second model is emerging around pay-per-use licensing, citing Microsoft’s announcement with People Inc. and other publishers late last year. He said current discussions are increasingly focused on pricing rather than whether companies will pay for content.
“We think that the AI, at this point, from this point forward, is more of an opportunity than a threat for our business,” Quinn said.
Capital Allocation Narrows to Stock, MGM and People M&A Chris said IAC’s capital allocation strategy is now clearer and focused on three priorities: buying back IAC stock, increasing exposure to MGM shares and pursuing strategic acquisitions through People Inc.
He said IAC has repurchased 13% of the company over the past 15 months for more than $400 million. He also said IAC bought about 1 million MGM shares in each of the last two quarters and now owns 26% of MGM.
On MGM, Chris said IAC remains a believer in the company and sees public markets undervaluing the asset. He cited potential value drivers including Las Vegas trends, BetMGM’s move from cash flow losses to cash flow generation, MGM’s international digital assets, MGM China and the company’s Japan project.
Asked what could lead IAC to divest MGM, Chris said that decision would be up to Chairman Barry Diller and the board. He noted that Diller has called MGM a “forever asset,” while also saying nothing has been part of IAC forever except “maybe The Daily Beast.”
People Inc. Eyes Direct Consumer Relationships Quinn said People Inc.’s acquisition interests are focused on assets that help create direct relationships with consumers. He said the company would consider “A-plus brands,” direct connections to consumers or advertisers, and possibly some ad tech, though nothing is imminent.
Quinn also discussed the company’s “inversion” strategy, which he described as an effort to build durable business models around People Inc.’s brands rather than relying solely on traffic or licensing. One example is MyRecipes, a digital cookbook product that has signed up more than 3 million registered customers in its first year.
“How do we create new, sustainable, durable business models that are not disintermediatable by Google or AI or anyone else?” Quinn said. “That's what we're working on now.”
Quinn said People Inc. has grown for 10 straight quarters, expanded margins and outperformed competitors, and he said he is focused on moving the investor narrative beyond concerns about AI traffic headwinds.
About IAC NASDAQ: IACIAC NASDAQ: IAC is a publicly traded holding company headquartered in New York City that builds and invests in consumer-focused internet businesses. Through its portfolio of digital media brands, online marketplaces and subscription services, IAC delivers content and connections across a range of verticals, including lifestyle, finance, home services and personal care. The company's operations span North America and parts of Europe, where its brands reach millions of visitors each month.
In the digital publishing space, IAC's Dotdash Meredith division develops original content and data‐driven journalism across more than a dozen specialty sites.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
Should You Invest $1,000 in People Incorporated Common Stock Right Now?Before you consider People Incorporated Common Stock, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and People Incorporated Common Stock wasn't on the list.
While People Incorporated Common Stock currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
Nuclear energy is entering a new growth cycle as rising power demand, expanding data centers, and renewed policy support bring the sector back into focus. After strong gains in recent years, the most impactful phase of nuclear investment may still be ahead. This report highlights seven nuclear energy stocks positioned across the value chain—combining near-term revenue with long-term upside as next-generation technologies scale. Click the link below to unlock the full list.
Simplification of the business from a holding company to just People Inc. (Publishing) and MGM Resorts (Betting) should help close the conglomerate discount gap vs. fair value. Selling off non-core assets like Turo and Vivian, followed by shareholder-friendly allocation of capital, should boost the stock price, with buybacks being the first method of returning capital to shareholders. Dealmaking is still part of IAC's (now People Inc.) DNA, and this could mean deals with Entain/BetMGM or peers like Ziff Davis to develop their existing businesses.
4 Golden Crosses With Double-Digit Upside AheadIAC NASDAQ: IAC executives said the company’s recent consolidation plan is intended to simplify its structure, reduce corporate expense and narrow what management views as a discount in the company’s share price.
Speaking at a TD Cowen fireside chat, Christopher Halpin, IAC’s chief operating officer and chief financial officer, said the late-April announcement followed earlier moves to divest non-core assets, including the sale of Care.com, which closed in the first quarter and raised about $300 million in cash.
Get PPLI alerts:
Halpin said IAC now has about $1 billion of cash on its balance sheet and plans to prioritize capital allocation toward IAC shares, MGM stock and strategic M&A at People Inc. He said the consolidation reflects the company’s view that, as IAC narrows around People Inc. and its MGM holdings, it no longer needs “two levels of corporate.”
Corporate consolidation expected to run through early 2027 Halpin said IAC expects the consolidation to generate more than $40 million in operating cash savings relative to IAC corporate expense, which had been running at about $85 million. He also said the company expects to save $20 million to $25 million of stock-based compensation on an ongoing basis.
The transition is expected to be completed by February 2027, with the second quarter of 2027 expected to be the first clean quarter reflecting the full benefit, Halpin said. He said every corporate employee has been assigned either a continuing role or a departure date. Halpin and Chief Legal Officer Kendall Handler are expected to remain through second-quarter earnings before handing off responsibilities to People Inc. Chief Executive Neil Vogel and Tim Quinn, People Inc.’s chief financial officer.
“We think it’s going to produce a leaner, faster, more efficient IAC, which will also be rebranded People Incorporated to the benefit of shareholders,” Halpin said.
Quinn said People Inc., which has about 3,600 employees, has the infrastructure to absorb the added functions, while noting that areas such as investor relations and tax will be picked up because People Inc. does not currently have those competencies in-house.
People Digital revenue grows as licensing and performance marketing offset traffic pressure Quinn said People Inc. had another solid first quarter, with total digital revenue growing about 8%. Advertising revenue grew 1% year over year and represented a little under 60% of People Digital revenue.
Quinn said advertising reflected two opposing trends: strong performance from the premium sales team, including off-platform advertising, and continued softness in traffic to owned-and-operated websites. He described the ad market as “solid” but “not spectacular.”
Performance marketing grew in the mid-teens and accounted for about a quarter of People Digital revenue. Quinn said the business refers consumers to retailers using guides, ratings, reviews and other methods, driving more than $1.5 billion in retail sales to companies including Amazon, Walmart, Nordstrom and Wayfair. He said 25% of performance marketing revenue is now tied to non-session-based views, reflecting distribution through channels such as Apple News, Discover, email and off-platform marketing.
Licensing, about 15% of the mix, also had a strong quarter. Quinn said the licensing business includes three categories: content licensing across platforms such as Apple News, Meta, Yahoo and MSN; AI and data licensing, including deals with OpenAI, Meta and Microsoft; and product and brand licenses, including the Better Homes & Gardens license with Walmart.
AI changes traffic patterns, but off-platform audiences grow Quinn said People Inc. began preparing for changes in media consumption after seeing an early version of ChatGPT in late 2022. The company reorganized around brand leaders responsible for creating content across magazines, websites and platforms such as YouTube, TikTok and Instagram.
Owned-and-operated website traffic declined 16% to 17% in the first quarter, and Quinn said the company expects that pressure could worsen in the second quarter. At the same time, off-platform audiences grew nearly 40% on a two-year compound annual growth basis in the first quarter.
Quinn said 60% of revenue is still derived from visits to People Inc.’s branded websites, and that portion was roughly flat to down 1% in the first quarter. The remaining 40% of revenue, derived from other sources, grew 24%.
On whether Google Search traffic will stabilize, Quinn said the answer varies by brand. Some brands, including InStyle, have very little search exposure, while others, such as recipe-related properties, remain more exposed to AI Overviews. Halpin said some brands appear to be near maximum AI Overviews frequency, while others are still moving through the transition.
Quinn said People Inc. is using AI tools to improve efficiency in content production, including topic selection, brief writing and workflows, while emphasizing that the company’s content remains human-made. He also said AI has potential applications in ad targeting, where People Inc. already commands a premium in the market.
Margins and cash flow remain in focus People Digital’s first-quarter EBITDA came in better than expected, with about 200 basis points of margin improvement, Quinn said. He attributed the improvement primarily to licensing and off-platform advertising products, both of which carry strong margins, offsetting margin pressure from declining website traffic.
Quinn said People Inc. expects second-quarter margins to remain solid and expects full-year margins to be comparable to last year, with the possibility of modest expansion.
For the broader company, Quinn noted IAC’s EBITDA guidance of $210 million to $260 million for the year, with at least $150 million coming from People Inc. He said People Inc. has strong free cash flow characteristics and expects at least 50% of EBITDA to convert to free cash flow.
Halpin said corporate expenses include one-time costs of about $15 million this year related to severance, retention bonuses and related items, and that many employee exits are weighted toward the back half of the year.
Executives discuss MGM, Turo and Google litigation Halpin also discussed IAC’s 26% stake in MGM Resorts, including MGM’s Osaka project in Japan. He called it an “incredible opportunity” to build the only legally licensed integrated gaming resort in Japan and said MGM has been thoughtful about hedging, local financing and tax structuring. He said investors may better appreciate the project as it approaches its expected autumn 2030 launch.
On Turo, Halpin said IAC owns 32% of the company and “very much” likes the business. He said Turo was a major pandemic winner, later faced headwinds in the rental car sector, and is now back to double-digit growth. He said the company is EBITDA and free cash flow positive.
Quinn also addressed potential litigation proceeds tied to Google’s ad tech case. He said People Inc. believes it can rely on government findings and a ruling that Google used monopolistic power to disadvantage advertisers and publishers in the ad tech market. Quinn said the debate now centers on the look-back period and damages, adding that People Inc. and its predecessors are among the largest plaintiffs in the action.
Quinn said the company has publicly discussed a potential recovery of more than $100 million, and that it could be “meaningfully more,” though the matter may take the rest of this year and into next year to resolve.
About IAC NASDAQ: IACIAC NASDAQ: IAC is a publicly traded holding company headquartered in New York City that builds and invests in consumer-focused internet businesses. Through its portfolio of digital media brands, online marketplaces and subscription services, IAC delivers content and connections across a range of verticals, including lifestyle, finance, home services and personal care. The company's operations span North America and parts of Europe, where its brands reach millions of visitors each month.
In the digital publishing space, IAC's Dotdash Meredith division develops original content and data‐driven journalism across more than a dozen specialty sites.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
Should You Invest $1,000 in People Incorporated Common Stock Right Now?Before you consider People Incorporated Common Stock, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and People Incorporated Common Stock wasn't on the list.
While People Incorporated Common Stock currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
Unlock the timeless value of gold with our exclusive 2026 Gold Forecasting Report. Explore why gold remains the ultimate investment for safeguarding wealth against inflation, economic shifts, and global uncertainties. Whether you're planning for future generations or seeking a reliable asset in turbulent times, this report is your essential guide to making informed decisions.
NEW YORK, June 1, 2026 /PRNewswire/ -- People Incorporated, previously IAC (NASDAQ: IAC), announced today that it has submitted a non-binding proposal to the Board of Directors of MGM Resorts International (NYSE: MGM) to acquire all outstanding shares of MGM that People Incorporated does not already own for $48.30 per share in cash. This proposal represents a premium of 24.1% to the volume-weighted average price of MGM common stock for the 30 trading days ending on May 29, 2026, a more than 30% premium to the stock's volume-weighted average price for the 90 trading days ending on the same date, and a 10.6% premium to the most recent closing price.
Barry Diller, whose company already owns a 26% share of casino giant, has said he sees it as a business that is less at risk of being disintermediated by technology.
Diller, senior executive and chairman of the internet and media conglomerate he founded in 1995, is worth an estimated $5.2 billion as of Monday. He has been chair of online travel giant Expedia since his company acquired Liberty Expedia in a $2.6 billion deal in 2019 and he built Pier 55 named—a park and performance venue named "Little Island"—in the Hudson River in 2021.
MGM Resorts International shares jumped on Monday after Barry Diller's People Inc. submitted a proposal to acquire the casino operator in a deal that values the company at approximately $18 billion, including debt. People Inc., formerly known as IAC, already owns a 26.1% stake in MGM and has offered to acquire the remaining shares it does not own for $48.30 per share in cash.
Barry Diller is making his next big move as People Inc. (previously IAC) submitted a non-binding proposal to acquire control of MGM Resorts International. The plan would be to buy outstanding MGM shares that People doesn't already own and take the publicly-traded company private. People Inc.
MGM Resorts International (NYSE:MGM) has received a non-binding, all-cash takeover proposal from American billionaire and media mogul Barry Diller's People Inc, formerly IAC, (NASDAQ: IAC) to acquire the 73.9% of the company it does not already own at $48.30 per share. People Inc said the offer implies an equity value of approximately $18 billion for the remaining stake and represents a 24.1% premium to MGM's 30-day volume-weighted average price through May 29, 2026, as well as a 10.6% premium to the latest closing price.
OKLAHOMA CITY, June 01, 2026 (GLOBE NEWSWIRE) -- Murphy Law Firm is investigating claims on behalf of all individuals whose personal and confidential information was compromised in the data breach involving Industrial Acceptance Corporation d/b/a IAC, Inc. To join the class action lawsuit, visit our site HERE. On February 24, 2025, Industrial Acceptance Corporation d/b/a IAC, Inc. (“IAC”) became aware of suspicious activity on its computer network, indicating a data breach.
A buyout proposal for a major casino operator typically creates a straightforward path for investors. The stock price usually settles just below the offer to account for time and deal risk.
Bloomberg Intelligence's Jody Lurie joins Scarlet Fu on "Bloomberg Deals." Barry Diller has made an offer for the remaining portion of MGM Resorts International he doesn't already own, marking the latest pivot for the billionaire media mogul after overhauling IAC.
Shares will begin trading under new Nasdaq stock symbol "PPLI" effective at market open today NEW YORK, June 4, 2026 /PRNewswire/ -- Today People Incorporated, formerly IAC (Nasdaq: IAC), announced its legal name change and that the Company's common stock, listed on the Nasdaq Capital Market, will begin trading under the new ticker symbol PPLI, effective at market open today June 4, 2026. People Incorporated is the public entity that owns America's largest publisher People Inc., and a significant minority stake in MGM Resorts International.
The media industry has spent the better part of a decade working to capture the attention of audiences whose content consumption habits have diversified to include many options beyond legacy models. Increasingly, the vertical screen has become the dominant one in people's lives.
OKLAHOMA CITY--(BUSINESS WIRE)--Paycom Software, Inc. (“Paycom”) (NYSE: PAYC), a leading provider of comprehensive, cloud-based human capital management software, announced today that its Board of Directors declared a cash dividend in the amount of $0.375 per share of common stock, to be paid on June 8, 2026, to all stockholders of record as of the close of business on May 26, 2026.
About Paycom
Paycom Software, Inc. (NYSE: PAYC) is a cloud-based human capital management software provider that allows organizations of all sizes across the U.S. and internationally to set numerous HR and payroll tasks to “automatic” through employee-first technology. Built on a truly single database, Paycom’s full-solution automation manages the entire employment life cycle, helping organizations streamline processes and improve data accuracy. With its industry-first AI engine, IWant™, Paycom provides instant access to accurate employee data without requiring users to navigate or learn the software. For over 25 years, Paycom has been repeatedly recognized by third‑party reviewers as a leading payroll and HCM solution.
First Quarter Revenues of $572 million, up 8% year-over-year
First Quarter GAAP Net Income of $156 million, representing 27% of total revenues, or $3.04 per diluted share
First Quarter Non-GAAP Net Income of $161 million, or $3.15 per diluted share
First Quarter Adjusted EBITDA of $275 million, representing 48% of total revenues
OKLAHOMA CITY--(BUSINESS WIRE)--Paycom Software, Inc. (“Paycom,” “we” and “our”) (NYSE: PAYC), a leading provider of comprehensive, cloud-based human capital management software, today announced its financial results for the quarter ended March 31, 2026.
“We delivered solid first-quarter results while executing our strategy to provide full-solution automation, stronger client ROI achievement and world-class service to our clients,” said Chad Richison, founder and CEO of Paycom. “Our focus on creating automation and employee-first technology is driving higher engagement and client satisfaction, while reinforcing Paycom’s position as the most automated solution in our industry. We are trusted leaders in AI and automated decisioning, with proven solutions like Beti, GONE and IWant helping our clients operate more efficiently. With only about 5% of the total addressable market served, we remain confident in the long-term growth opportunity ahead.”
Financial Highlights for the First Quarter of 2026
Total Revenues of $571.9 million represented a 7.8% increase compared to total revenues of $530.5 million in the same period last year. Recurring and other revenues of $544.0 million increased 8.8% from the comparable prior year period and constituted 95.1% of total revenues.
GAAP Net Income was $155.7 million, or $3.04 per diluted share, compared to GAAP net income of $139.4 million, or $2.48 per diluted share, in the same period last year.
Non-GAAP Net Income1 was $161.3 million, or $3.15 per diluted share, compared to $157.7 million, or $2.80 per diluted share, in the same period last year.
Adjusted EBITDA1 was $275.4 million, compared to $253.2 million in the same period last year.
Cash and Cash Equivalents were $153.9 million as of March 31, 2026, compared to $370.0 million as of December 31, 2025. During the quarter ended March 31, 2026, Paycom paid $17.7 million in cash dividends and repurchased 8,375,443 shares of common stock for $1.060 billion, in the aggregate.
Financial Outlook
Paycom provides the following expected financial guidance for the year ending December 31, 2026.
Total revenue in the range of $2.175 billion to $2.195 billion, representing year-over-year growth between 6% and 7%.
Recurring and other revenue growth between 7% and 8% year over year.
Interest on funds held for clients of approximately $103 million.
Adjusted EBITDA in the range of $950 million to $970 million, representing a margin of approximately 44% at the midpoint.
We have not reconciled the forward-looking adjusted EBITDA ranges and adjusted EBITDA margin presented above and discussed on the teleconference call to net income, nor the forward-looking non-GAAP effective income tax rate discussed on the teleconference call, to comparable GAAP measures because applicable information for future periods, on which these reconciliations would be based, is not readily available due to uncertainty regarding, and the potential variability of, depreciation and amortization, interest expense, taxes, non-cash stock-based compensation expense and other items. Accordingly, reconciliations of the forward-looking adjusted EBITDA ranges to net income, the forward-looking adjusted EBITDA margin to net income margin, and the forward-looking non-GAAP effective income tax rate to the GAAP effective income tax rate are not available at this time without unreasonable effort.
Use of Non-GAAP Financial Information
To supplement our financial information presented in accordance with generally accepted accounting principles in the United States (“GAAP”), we present certain non-GAAP financial measures in this press release and on the related teleconference call, including adjusted EBITDA, non-GAAP net income, adjusted gross profit, adjusted gross margin, adjusted sales and marketing expenses, adjusted total administrative expenses, adjusted research and development expenses, adjusted total research and development costs, adjusted EBITDA margin, non-GAAP effective income tax rate, free cash flow and free cash flow margin. Management uses these non-GAAP financial measures as supplemental measures to review and assess the performance of our core business operations and for planning purposes. We define (i) adjusted EBITDA as net income plus interest expense, taxes, depreciation and amortization, non-cash stock-based compensation expense, certain transaction expenses that are not core to our operations (if any) and any loss on the extinguishment of debt, less any gain on modification of the naming rights agreement, (ii) non-GAAP net income as net income plus non-cash stock-based compensation expense, certain transaction expenses that are not core to our operations (if any) and any loss on the extinguishment of debt, less any gain on modification of the naming rights agreement, all of which are adjusted for the effect of income taxes, (iii) adjusted gross profit as gross profit plus applicable non-cash stock-based compensation expense, (iv) adjusted gross margin as gross profit plus applicable non-cash stock-based compensation expense, divided by total revenues, (v) each adjusted expense item as the GAAP expense amount less applicable non-cash stock-based compensation expense, (vi) adjusted total research and development costs as total research and development costs (including the capitalized portion) less applicable non-cash stock-based compensation (including the capitalized portion), (vii) adjusted EBITDA margin as adjusted EBITDA (calculated as described in clause (i)) divided by total revenues, (viii) non-GAAP effective income tax rate as the provision for income taxes plus the income tax effect on non-GAAP adjustments divided by non-GAAP net income (calculated as described in clause (ii)) plus the provision for income taxes and the income tax effect on non-GAAP adjustments, (ix) free cash flow as net cash provided by operating activities, less purchases of property and equipment and purchases of intangible assets (if any), and (x) free cash flow margin as free cash flow (calculated as described in clause (ix)) divided by total revenues. The terms “capital expenditures” and “cap ex” refer to the aggregate amount of purchases of property and equipment and purchases of intangible assets, if any, during the applicable period. The non-GAAP financial measures presented in this press release and discussed on the related teleconference call provide investors with greater transparency to the information used by management in its financial and operational decision-making. We believe these metrics are useful to investors because they facilitate comparisons of our core business operations across periods on a consistent basis, as well as comparisons with the results of peer companies, many of which use similar non-GAAP financial measures to supplement results under GAAP. In addition, adjusted EBITDA is a measure that provides useful information to management about the amount of cash available for reinvestment in our business, paying dividends, repurchasing common stock and other purposes. Management believes that the non-GAAP measures presented in this press release and discussed on the related teleconference call, when viewed in combination with our results prepared in accordance with GAAP, provide a more complete understanding of the factors and trends affecting our business and performance.
The non-GAAP financial measures presented in this press release and discussed on the related teleconference call are not measures of financial performance under GAAP and should not be considered a substitute for net income, gross profit, gross margin, research and development expenses, sales and marketing expenses, administrative expenses, total research and development costs, GAAP effective income tax rate and net cash provided by operating activities. Non-GAAP financial measures have limitations as analytical tools, and when assessing our operating performance, you should not consider these non-GAAP financial measures in isolation, or as a substitute for the consolidated statements of income data prepared in accordance with GAAP. The non-GAAP financial measures that we present may not be comparable to similarly titled measures of other companies, and other companies may not calculate such measures in the same manner as we do.
Conference Call Details
In conjunction with this announcement, Paycom will host a conference call today, May 6, 2026, at 5:00 p.m. Eastern time to discuss its financial results. To access this call, dial (833) 461-5787 and provide 317740632 as the access code. A live webcast as well as the replay of the conference call will be available on the Investor Relations page of Paycom’s website at investors.paycom.com.
About Paycom
Paycom Software, Inc. (NYSE: PAYC) is a cloud-based human capital management software provider that allows organizations of all sizes across the U.S. and internationally to set numerous HR and payroll tasks to “automatic” through employee-first technology. Built on a truly single database, Paycom’s full-solution automation manages the entire employment life cycle, helping organizations streamline processes and improve data accuracy. With its industry-first AI engine, IWant™, Paycom provides instant access to accurate employee data without requiring users to navigate or learn the software. For over 25 years, Paycom has been repeatedly recognized by third‑party reviewers as a leading payroll and HCM solution.
Financial Presentation
Dollar amounts are presented in millions, except amounts per share. As a result, some amounts may not sum or recalculate exactly due to rounding. All percentages have been calculated using unrounded amounts.
Forward-Looking Statements
Certain statements in this press release are, and certain statements on the related teleconference call may be, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are any statements that refer to our estimated or anticipated results, other non-historical facts or future events and include, but are not limited to, statements regarding our business strategy; anticipated future operating results and operating expenses, cash flows, capital resources, dividends and liquidity; competition; trends, opportunities and risks affecting our business, industry and financial results, including macroeconomic factors; future expansion or growth plans and potential for future growth, including internationally; our ability to attract new clients to purchase our solution; our ability to retain clients and induce them to purchase additional applications; our ability to accurately forecast future revenues and appropriately plan our expenses; market acceptance of our solution and applications; our expectations regarding future revenues generated by certain applications; the return on investment for users of our solution, as well as how certain applications may impact client employee usage and client satisfaction; our ability to attract and retain qualified employees and key personnel; future regulatory, judicial and legislative changes; how the performance of certain of our offerings is sensitive to changes in the labor market; our plan to add sales teams and our ability to effectively execute such plan; the sufficiency of our existing cash and cash equivalents to meet our working capital and capital expenditure needs over the next 12 months; our plans regarding our capital expenditures and investment activity as our business grows, including with respect to research and development and the expansion of our facilities; our plans to pay cash dividends; our plans to repurchase shares of our common stock through a stock repurchase plan using cash and/or borrowings under our senior secured revolving credit facility; and our expected income tax rate for future periods. In addition, forward-looking statements also consist of statements involving trend analyses and statements including such words as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “should,” “will,” “would,” and similar expressions or the negative of such terms or other comparable terminology. These forward-looking statements are based only on information currently available to us, speak only as of the date hereof and are subject to business and economic risks. As such, our actual results could differ materially from those set forth in the forward-looking statements as a result of the factors discussed in our filings with the Securities and Exchange Commission, including but not limited to those discussed in our most recent Annual Report on Form 10-K. We do not undertake any obligation to update or revise the forward-looking statements to reflect events that occur or circumstances that exist after the date on which such statements were made, except to the extent required by law.
Paycom Software, Inc.
Unaudited Consolidated Balance Sheets
(in millions, except per share amounts)
March 31, 2026
December 31, 2025
Assets
Current assets:
Cash and cash equivalents
$
153.9
$
370.0
Accounts receivable
51.3
44.9
Prepaid expenses
58.0
47.5
Inventory
1.5
1.7
Income tax receivable
20.6
78.2
Deferred contract costs
164.1
159.5
Current assets before funds held for clients
449.4
701.8
Funds held for clients
2,624.6
5,137.0
Total current assets
3,074.0
5,838.8
Property and equipment, net
669.0
687.3
Intangible assets, net
34.0
37.4
Goodwill
51.9
51.9
Long-term deferred contract costs
872.8
857.4
Operating lease right-of-use assets
86.2
89.4
Other assets
33.8
36.5
Total assets
$
4,821.8
$
7,598.7
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable
$
9.4
$
6.6
Accrued commissions and bonuses
14.2
28.2
Accrued payroll and vacation
42.6
60.1
Deferred revenue
32.3
28.3
Operating lease liabilities
28.6
28.4
Accrued expenses and other current liabilities
87.7
79.8
Current liabilities before client funds obligation
214.8
231.4
Client funds obligation
2,624.7
5,137.0
Total current liabilities
2,839.5
5,368.4
Deferred income tax liabilities, net
306.6
304.4
Long-term deferred revenue
121.7
121.9
Long-term debt
675.0
—
Long-term operating lease liabilities
60.0
61.9
Other long-term liabilities
7.2
10.6
Total long-term liabilities
1,170.6
498.8
Total liabilities
4,010.1
5,867.2
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.01 par value (100.0 shares authorized, 63.7 and 63.6 shares issued at March 31, 2026 and December 31, 2025, respectively; 46.6 and 54.8 shares outstanding at March 31, 2026 and December 31, 2025, respectively)
0.6
0.6
Additional paid-in capital
887.3
878.4
Retained earnings
2,393.8
2,255.6
Accumulated other comprehensive earnings (loss)
(0.6
)
0.3
Treasury stock, at cost (17.1 and 8.8 shares at March 31, 2026 and December 31, 2025, respectively)
(2,469.4
)
(1,403.4
)
Total stockholders’ equity
811.7
1,731.5
Total liabilities and stockholders’ equity
$
4,821.8
$
7,598.7
Paycom Software, Inc.
Unaudited Consolidated Statements of Comprehensive Income
(in millions, except per share amounts)
Three Months Ended March 31,
2026
2025
Revenues
Recurring and other
$
544.0
$
500.0
Interest on funds held for clients
27.8
30.5
Total revenues
571.9
530.5
Cost of revenues
Operating expenses
62.9
66.3
Depreciation and amortization
24.4
18.3
Total cost of revenues
87.3
84.6
Administrative expenses
Sales and marketing
117.6
110.9
Research and development
60.7
62.3
General and administrative
69.4
66.0
Depreciation and amortization
26.7
21.6
Total administrative expenses
274.3
260.8
Total operating expenses
361.7
345.4
Operating income
210.2
185.1
Interest expense
(4.0
)
(0.8
)
Other income, net
9.1
6.0
Income before income taxes
215.3
190.3
Provision for income taxes
59.5
50.9
Net income
$
155.7
$
139.4
Earnings per share, basic
$
3.05
$
2.49
Earnings per share, diluted
$
3.04
$
2.48
Weighted average shares outstanding:
Basic
51.1
56.0
Diluted
51.2
56.3
Comprehensive earnings:
Net income
$
155.7
$
139.4
Unrealized net gains (losses) on available-for-sale securities
(0.7
)
0.6
Tax effect
(0.2
)
(0.1
)
Other comprehensive income (loss), net of tax
(0.9
)
0.5
Comprehensive earnings
$
154.9
$
139.9
Paycom Software, Inc.
Unaudited Consolidated Statements of Cash Flows
(in millions)
Three Months Ended March 31,
2026
2025
Cash flows from operating activities
Net income
$
155.7
$
139.4
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
51.1
39.9
Stock-based compensation expense
14.1
22.2
Amortization of debt issuance costs
0.2
0.3
Loss on disposition of property and equipment
2.9
—
Accretion of discount on available-for-sale securities
(1.3
)
(1.3
)
Non-cash marketing expense
0.1
0.4
Deferred income taxes, net
2.0
(6.2
)
Gain on modification of naming rights agreement
(9.0
)
—
Other
—
0.1
Changes in operating assets and liabilities:
Accounts receivable
(4.6
)
7.9
Prepaid expenses
(15.1
)
(4.5
)
Inventory
0.1
—
Other assets
2.4
0.3
Deferred contract costs
(20.1
)
(31.4
)
Income taxes, net
57.6
54.9
Accounts payable
2.4
(14.4
)
Accrued commissions and bonuses
(13.9
)
(13.4
)
Accrued payroll and vacation
(17.5
)
(12.5
)
Deferred revenue
3.9
4.1
Accrued expenses and other liabilities
1.5
(4.0
)
Net change in operating right-of-use assets and operating lease liabilities
1.4
0.7
Net cash provided by operating activities
213.8
182.5
Cash flows from investing activities
Purchases of investments from funds held for clients
(166.6
)
(342.2
)
Proceeds from investments from funds held for clients
167.0
—
Purchases of property and equipment
(31.2
)
(37.7
)
Net cash used in investing activities
(30.8
)
(379.9
)
Cash flows from financing activities
Proceeds from borrowings under credit facility
675.0
—
Repurchases of common stock
(1,054.3
)
—
Withholding taxes paid related to net share settlements
(6.1
)
(5.2
)
Dividends paid
(17.7
)
(21.1
)
Proceeds from employee stock purchase plan
3.6
—
Net change in client funds obligation
(2,512.3
)
(1,426.0
)
Net cash used in financing activities
(2,911.8
)
(1,452.3
)
Decrease in cash, cash equivalents, restricted cash and restricted cash equivalents
(2,728.8
)
(1,649.7
)
Cash, cash equivalents, restricted cash and restricted cash equivalents
Cash, cash equivalents, restricted cash and restricted cash equivalents, beginning of period
5,132.5
4,042.8
Cash, cash equivalents, restricted cash and restricted cash equivalents, end of period
$
2,403.8
$
2,393.1
Paycom Software, Inc.
Unaudited Consolidated Statements of Cash Flows, continued
(in millions)
Three Months Ended March 31,
2026
2025
Reconciliation of cash, cash equivalents, restricted cash and restricted cash equivalents
Cash and cash equivalents
$
153.9
$
520.8
Restricted cash included in funds held for clients
2,249.8
1,872.3
Total cash, cash equivalents, restricted cash and restricted cash equivalents, end of period
$
2,403.8
$
2,393.1
Supplemental disclosures of cash flow information:
Non-cash investing and financing activities:
Purchases of property and equipment, accrued but not paid
$
2.0
$
5.5
Stock-based compensation for capitalized software
$
0.3
$
5.3
Right-of-use assets obtained in exchange for operating lease liabilities
$
2.9
$
2.2
Paycom Software, Inc.
Unaudited Reconciliations of GAAP to Non-GAAP Financial Measures
(in millions, except per share amounts)
Three Months Ended March 31,
2026
2025
Net income to adjusted EBITDA:
Net income
$
155.7
$
139.4
Interest expense
4.0
0.8
Provision for income taxes
59.5
50.9
Depreciation and amortization
51.1
39.9
EBITDA
270.4
231.0
Non-cash stock-based compensation expense
14.1
22.2
Gain on modification of naming rights agreement
(9.0
)
—
Adjusted EBITDA
$
275.4
$
253.2
Net income margin
27.2
%
26.3
%
Adjusted EBITDA margin
48.2
%
47.7
%
Three Months Ended March 31,
2026
2025
Net income to non-GAAP net income:
Net income
$
155.7
$
139.4
Non-cash stock-based compensation expense
14.1
22.2
Gain on modification of naming rights agreement
(9.0
)
—
Income tax effect on non-GAAP adjustments
0.5
(3.9
)
Non-GAAP net income
$
161.3
$
157.7
Weighted average shares outstanding:
Basic
51.1
56.0
Diluted
51.2
56.3
Earnings per share, basic
$
3.05
$
2.49
Earnings per share, diluted
$
3.04
$
2.48
Non-GAAP net income per share, basic
$
3.16
$
2.82
Non-GAAP net income per share, diluted
$
3.15
$
2.80
Three Months Ended March 31,
2026
2025
Earnings per share to non-GAAP net income per share, basic:
Earnings per share, basic
$
3.05
$
2.49
Non-cash stock-based compensation expense
0.28
0.40
Gain on modification of naming rights agreement
(0.18
)
—
Income tax effect on non-GAAP adjustments
0.01
(0.07
)
Non-GAAP net income per share, basic
$
3.16
$
2.82
Three Months Ended March 31,
2026
2025
Earnings per share to non-GAAP net income per share, diluted:
Earnings per share, diluted
$
3.04
$
2.48
Non-cash stock-based compensation expense
0.27
0.39
Gain on modification of naming rights agreement
(0.18
)
—
Income tax effect on non-GAAP adjustments
0.01
(0.07
)
Non-GAAP net income per share, diluted
$
3.15
$
2.80
Three Months Ended March 31,
2026
2025
Adjusted gross profit:
Total revenues
$
571.9
$
530.5
Less: Total cost of revenues
(87.3
)
(84.6
)
Total gross profit
484.5
445.9
Plus: Non-cash stock-based compensation expense
2.2
3.0
Total adjusted gross profit
$
486.7
$
448.9
Gross margin
84.7
%
84.0
%
Adjusted gross margin
85.1
%
84.6
%
Three Months Ended March 31,
2026
2025
Adjusted sales and marketing expenses:
Sales and marketing expenses
$
117.6
$
110.9
Less: Non-cash stock-based compensation expense
(4.1
)
(5.9
)
Adjusted sales and marketing expenses
$
113.5
$
105.0
Total revenues
$
571.9
$
530.5
Sales and marketing expenses as a % of revenues
20.6
%
20.9
%
Adjusted sales and marketing expenses as a % of revenues
19.8
%
19.8
%
Three Months Ended March 31,
2026
2025
Adjusted total administrative expenses:
Total administrative expenses
$
274.3
$
260.8
Less: Non-cash stock-based compensation expense
(11.9
)
(19.2
)
Adjusted total administrative expenses
$
262.5
$
241.6
Total revenues
$
571.9
$
530.5
Total administrative expenses as a % of revenues
48.0
%
49.1
%
Adjusted total administrative expenses as a % of revenues
45.9
%
45.5
%
Three Months Ended March 31,
2026
2025
Adjusted research and development expenses:
Research and development expenses
$
60.7
$
62.3
Less: Non-cash stock-based compensation expense
0.1
(6.9
)
Adjusted research and development expenses
$
60.8
$
55.4
Total revenues
$
571.9
$
530.5
Research and development expenses as a % of revenues
10.6
%
11.7
%
Adjusted research and development expenses as a % of revenues
10.6
%
10.4
%
Three Months Ended March 31,
2026
2025
Total research and development costs:
Capitalized research and development costs
$
25.3
$
33.7
Research and development expenses
60.7
62.3
Total research and development costs
$
86.0
$
96.0
Total revenues
$
571.9
$
530.5
Total research and development costs as a % of revenues
Paycom Software (PAYC) came out with quarterly earnings of $3.15 per share, beating the Zacks Consensus Estimate of $2.93 per share. This compares to earnings of $2.8 per share a year ago.
1. Arm Sinks on Chip Supply Strains Arm Holdings (ARM +8.25%) fell over 6% in pre-market trading as results warned of slower growth in the smartphone market due to a memory chip shortage, even as the outlook for AI data center growth was upgraded, providing an insight for the major tech companies that rely on Arm's services.
CEO sees unit growth for phones "flip to negative": The shortage of memory chips was a key factor as Rene Haas flagged the slowdown in the smartphone division, an area it still relies on significantly for revenue. Arm provides the computing architecture that powers the iPhone for Apple (AAPL 1.57%). New Arm CPU has over $2 billion of customer demand across the next two financial years: The move to start to sell homegrown chips has been well received, with it being able to build on its existing scale in the cloud. The company has a 50% market share of the CPU compute market among top hyperscalers, including Amazon (AMZN 2.17%) and Alphabet (GOOG +0.83%). 2. Overnight Movers From Team Rule Breakers Recs Cognex (CGNX +1.96%) popped over 14% higher ahead of the market open after an impressive 24.3% year over year (YoY) revenue growth as part of quarterly results, with guidance upgraded due to broad-based strength in machine vision technology. Dutch Bros (BROS +1.01%) fell 3% before the opening bell as management noted ongoing cost pressure on margins, although updated forecasts indicate at least 185 new store locations will be opened this year. BBB Foods (TBBB +0.74%) rose 2% in pre-market trading as earnings detailed a 33% YoY revenue jump. Fool contributing analyst Dan Caplinger said last month he's impressed "with what the company and its forward-thinking founder/CEO have accomplished, and we see more room for BBB Foods to expand in the fast-growing Mexican grocery market." Axon Enterprise (AXON 2.02%) moved around 1% lower ahead of the opening bell due to results revealing pressure on margins and cash flow as investments climbed. 3. Team Hidden Gems' Recommendations Popping in Pre-Market Trading Paycom Software (PAYC +1.18%) rose over 4% after results were released, thanks to recurring subscription income making up more than 95% of total revenue. However, management is guiding for more measured growth in the quarters ahead. Sezzle (SEZL +3.96%) soared about 15% as quarterly earnings revealed a sharp 48.4% YoY jump in active subscribers that helped to fuel a 37.3% increase in gross merchandise volume. 4. Memory Stocks Fly as Scarcity Continues Micron Technology (MU 0.22%) closed over 4% higher yesterday, with Western Digital (WDC +6.40%) not far behind, as memory sector stocks continue to rally amid chip shortages and continued AI demand.
Mag 7 earnings detail higher capex spending: The jump over recent days can be partly attributed to big tech companies' actions, with Microsoft (MSFT 0.73%) raising its capex forecast for the year by $25 billion, with Meta (META +0.45%) adding $10 billion. Both spoke of higher component costs as the justification. Micron due to generate 80 cents of gross profit for each dollar of revenue in 2026: Companies in the sector are able to have strong pricing power due to the current market backdrop, although some are cautious about the future prospects given historical volatility in related stocks. 5. Next Up: Selected Earnings to Watch Celsius Holdings (CELH +0.63%) shares charged around 5% higher in pre-market trading following a blockbuster first quarter that saw revenue skyrocket 137.7% to a record $782.6 million. While the core Celsius brand saw a steady 6% uptick, the real story was the explosive growth of Alani Nu, which delivered $368.1 million in quarterly sales. Arista Networks (ANET +4.48%) should deliver earnings after the market closes, with a focus on how it's dealing with supply constraints. The stock is outperforming the S&P 500 by 467% since the May 2022 Rule Breakers rec. Airbnb (ABNB +0.01%) releases results after the closing bell. The stock, recommended by both Team Rule Breakers and Team Hidden Gems, is aiming to deliver strong growth in gross booking value (GBV), following on from last quarter. 6. Your Take DoorDash (DASH 3.78%) reported Wednesday, sending the stock up over 10% in after-hours trading. Uber (UBER 2.47%) rose over 8.5% yesterday on positive earnings, too.
We're asking which of the two food delivery rivals you'd rather start a position in today, and why?
Discuss with friends and family, or become a member to hear what your fellow Fools are saying!
This image and article was created using Large Language Models (LLMs) based on The Motley Fool's insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Airbnb, Alphabet, Amazon, Apple, Arista Networks, Axon Enterprise, BBB Foods, Celsius Holdings, Cognex, DoorDash, Dutch Bros, Meta Platforms, Micron Technology, Microsoft, Paycom Software, Sezzle, Uber Technologies, and Western Digital. The Motley Fool has a disclosure policy.
Key Takeaways Paycom posted Q1 EPS of $3.15 and revenues of $571.9M, both ahead of consensus and up year over year.PAYC's recurring revenues rose 8.8% to $544M, while gross margin expanded 50 bps to 85.1%.Paycom guided 2026 revenues of $2.175-$2.195B and expects adjusted EBITDA of $950-$970M. Paycom Software, Inc. (PAYC - Free Report) reported better-than-expected first-quarter 2026 results, wherein both top and bottom lines surpassed the Zacks Consensus Estimate.
The online payroll and human resource technology provider reported non-GAAP earnings of $3.15 per share, which increased 12.5% year over year and beat the Zacks Consensus Estimate by 7.5%.
Paycom’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, while missing once, the average surprise being 5.7%.
Revenues totaled $571.9 million, which rose 7.8% from the year-ago quarter and exceeded the consensus estimate of $565 million by 1.2%.
Paycom’s Q1 in DetailPaycom’s Recurring revenues (representing 95.1% of the total revenues) improved 8.8% to $544 million in the first quarter. Our estimate for the company’s Recurring revenues was pegged at $538.2 million.
Paycom’s revenues from the Interest on funds held for clients segment decreased to $27.8 million from $30.5 million in the year-ago quarter and contributed 4.9% to total sales. Our estimate for the segment’s revenues was pegged at $27.7 million.
Adjusted gross profits increased 8.4% from the year-ago period to $486.7 million. The adjusted gross margin expanded 50 basis points (bps) on a year-over-year basis to 85.1%.
Paycom’s adjusted EBITDA rose 8.8% year over year to $275.4 million. The adjusted EBITDA margin expanded 50 basis points to 48.2%.
Paycom’s Balance Sheet & Cash FlowPaycom exited the first quarter with cash and cash equivalents of $153.9 million compared with $370 million recorded in the previous quarter. The company had long-term debt of $675 million as of March 31, 2026.
In the first quarter of 2026, PAYC generated operating cash flow of approximately $213.8 million, paid out $17.7 million in dividends and bought back $1.06 billion worth of its common stock.
The board also approved a new $2 billion buyback authorization. Earlier on May 4, Paycom declared its upcoming quarterly dividend of 37.5 cents per share, payable on May 26, 2026.
Paycom Reaffirms 2026 GuidanceFollowing the first-quarter performance, management reaffirmed full-year guidance ranges. For 2026, Paycom continues to expect total revenues of $2.175-$2.195 billion, implying year-over-year growth of 6-7%. The Zacks Consensus Estimate is pegged at $2.19 billion, indicating year-over-year growth of 6.8%.
The company projects recurring revenues to grow 7-8% year over year. PAYC forecasts revenues from Interest on funds held for clients to be $103 million.
Paycom expects its 2026 adjusted EBITDA to be between $950 million and $970 million, translating to an EBITDA margin of approximately 44% at the midpoint.
Paycom’s Zacks Rank & Stocks to ConsiderCurrently, PAYC carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Computer and Technology sector are Broadcom (AVGO - Free Report) , Celestica (CLS - Free Report) and Amphenol (APH - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Broadcom have gained 19.2% year to date. The Zacks Consensus Estimate for Broadcom’s 2026 earnings is pegged at $11.45 per share, up by 9 cents over the past 30 days, indicating an increase of 67.9% year over year.
Shares of Celestica have gained 30.3% year to date. The Zacks Consensus Estimate for Celestica’s 2026 earnings is pegged at $10.16 per share, up 3.4% over the past seven days, indicating an increase of 67.9% year over year.
Amphenol shares have jumped 1.1% year to date. The Zacks Consensus Estimate for APH’s 2026 earnings is pegged at $4.76 per share, up by 11% over the past seven days, indicating an increase of 42.5% year over year.
(We are reissuing this article to correct a mistake. The original article, issued on May 7, 2026, should no longer be relied upon.)
Investors with an interest in Internet - Software stocks have likely encountered both Paycom Software (PAYC) and Autodesk (ADSK). But which of these two stocks is more attractive to value investors?
