It has been about a month since the last earnings report for Red Rock Resorts (RRR - Free Report) . Shares have added about 7.1% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Red Rock Resorts due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.
Red Rock Resorts Q1 Earnings Beat Estimates, Revenues LagRed Rock Resorts reported first-quarter 2026 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top line increased year over year, while the bottom line declined.
In the quarter under review, adjusted earnings per share (EPS) came in at 73 cents, topping the Zacks Consensus Estimate of 54 cents by 35.2%. In the prior-year quarter, the company recorded an adjusted EPS of 75 cents.
Quarterly revenues of $507.3 million missed the Zacks Consensus Estimate of $510 million. However, the top line increased 1.9% year over year.
Consolidated adjusted EBITDA margin held at a still-healthy 41.9%, as steady gaming fundamentals helped offset disruption tied to ongoing property projects.
RRR Keeps the Top-Line Growing With Casino-Led MixCasino revenues remained the anchor in the quarter, increasing to $340.5 million from $333.2 million a year ago. Food and beverage revenues also edged higher to $90.3 million, reflecting continued guest demand across the portfolio’s outlets.
Hotel was the notable soft spot within the mix, with room revenues declining to $45.5 million from $50.2 million in the year-ago quarter. Other revenues increased to $26.2 million, while Native American management and development fees added $4.7 million, tied to the North Fork project.
Red Rock Resorts Highlights Strength in Las Vegas OperationsThe company’s Las Vegas operations continued to set the tone, delivering net revenues of $499.5 million and underscoring management’s view that the locals customer remains resilient despite a choppier macro backdrop later in the quarter.
During the quarter, the company reported sustained traction in carded slot play, helped by robust spend per visit and net theoretical win across local, regional and national customer segments. It also emphasized that Durango’s continued ramp and the associated “backfill” at core properties remain central to the portfolio’s growth strategy.
RRR Absorbs Higher Costs as Renovations Pressure ResultsExpense discipline was mixed in the period. Selling, general and administrative costs increased to $114.4 million from $104.7 million, while depreciation and amortization rose to $55.9 million from $48.3 million, reflecting the company’s elevated reinvestment cycle.
Operationally, management framed much of the year-over-year profitability pressure as project-related, with Green Valley Ranch renovations reducing room nights and creating temporary friction at the property. The company also cited elevated utilities and certain non-recurring items as incremental headwinds during the quarter.
Red Rock Resorts Converts Cash Flow and Returns CapitalRRR generated $107 million of operating free cash flow, or $1.03 per share, converting 50.3% of adjusted EBITDA into operating free cash flow in the quarter. Management said this cash flow supported both the company’s capital program and shareholder returns.
Capital allocation remained active. During the quarter, the company repurchased roughly 635,000 Class A shares at an average price of $60.32 and paid a $1.00 per-share special dividend alongside the regular $0.26 quarterly dividend. The board also declared another $0.26 per-share dividend for the second quarter of 2026, payable June 30, to its shareholders of record June 15.
RRR’s Outlook Centers on Durango and North Fork MilestonesManagement guided to full-year 2026 capital spending of $375-$425 million, including $275-$300 million of investment capital and $100-$125 million of maintenance capital. The spend reflects continued work at Durango, Sunset Station and Green Valley Ranch, where renovations are intended to refresh the product and support higher-value visitation over time.
Two longer-dated growth catalysts also moved forward. The Durango North expansion is slated to add more than 275,000 square feet, including additional gaming and new amenities such as a bowling facility and luxury theaters, with an expected opening in summer 2027 and an estimated cost of about $385 million. Meanwhile, North Fork construction remains on track for an early fourth-quarter 2026 opening, with total project cost held at roughly $750 million and a remaining note balance of $80.6 million due from the Tribe at quarter's end.
How Have Estimates Been Moving Since Then?Since the earnings release, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -22.63% due to these changes.
VGM ScoresAt this time, Red Rock Resorts has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. Charting a somewhat similar path, the stock has a score of D on the value side, putting it in the bottom 40% for value investors.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
OutlookEstimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Red Rock Resorts has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.
On May 28, 2026, Caesars Entertainment (NASDAQ: CZR | CZR Price Prediction) announced a definitive agreement to be acquired by Fertitta Entertainment. The all-cash transaction is valued at approximately $17.6 billion, including the assumption of approximately $11.9 billion of outstanding debt. Shareholders get $31.00 per share, a 49% premium to the unaffected price on February 25, 2026. Financing is locked, the board has signed off, and a go-shop period runs through July 11, 2026.
Golden Entertainment (NASDAQ: GDEN) CEO Blake Sartini and affiliates announced a take-private deal on November 6, 2025, that closed on April 30, 2026. VICI Properties acquired seven casino real estate assets for $1.16 billion in a sale-leaseback. Golden set the precedent: the founder rolls over their shares, splits the business operations from the real estate, and uses a REIT sale-leaseback to fund the buyout. The same blueprint now lights up the other names on this list.
The rest of the regional casino sector is now on the clock. Below are three publicly traded casino names most exposed to the next take-private headline, ranked from least to most likely.
3. Bally’s Bally’s (NYSE: BALY) is the cheapest name on the board with the messiest cap table. Market cap is roughly $684.8 million, against $4.41 billion in long-term debt and a price-to-book of 0.85. The asset base is sprawling:
The $4.0 billion Bally’s Bronx integrated resort targeting a 2030 opening Bally’s Chicago under construction A 38% equity stake in Star Entertainment in Australia A 58% controlling stake in Intralot. Standard General has chased it before. Reports of acquisition talks with Evoke are circulating. The strategic options are numerous, but the path forward remains unclear. Shares traded at $13.99 on May 28, 2026, down 15.3% year to date.
2. PENN Entertainment PENN Entertainment (NASDAQ: PENN) has the activist track record and the digital turnaround. Q1 2026 delivered adjusted EPS of $0.11 versus a consensus estimate of $0.0206. Consolidated adjusted EBITDA totaled $265.8 million, up 53.4% year over year. CEO Jay Snowden has guided to 20% segment adjusted EBITDAR growth in 2026 and initially an Interactive break-even. Boyd Gaming already tried once. HG Vora forced a board settlement. Forward P/E is 12x.
Here’s the catch: PENN is an operating company (OpCo) sitting on $247.7 million in quarterly triple-net rent, with lease-adjusted leverage of 6.4x to 6.8x. There is no separable real estate to monetize, which caps the LBO math. The stock has already moved: $19.44 on May 28, up 31.8% year to date. A strategic bidder makes more sense than a sponsor.
1. Red Rock Resorts Red Rock Resorts (NASDAQ: RRR) is the cleanest fit for the Golden Entertainment template, scaled up. Frank Fertitta III and Lorenzo Fertitta (cousins of Tilman Fertitta) already control the company through Class B supervoting shares. That means a friendly family-led take-private is the only realistic path, and that path has just been validated next door.
The asset base is premium and concentrated. Las Vegas operations generated $492.64 million of Q4 2024 revenue, 99.4% of total. That was anchored by Red Rock, Green Valley Ranch, and the $780 million Durango Resort that opened December 5, 2023. Adjusted EBITDA runs at a consistent $200 million-plus quarterly clip. EV/EBITDA is 8.5x, with a $67.25 analyst target that is well above the $57.78 close on May 28. Crucially, Red Rock owns most of its real estate outright, giving any take-private the same VICI-style sale-leaseback option Sartini just executed at Golden. Insider sales in February and March at $58.81 to $66.24 are a near-term flag, but those are executive-level dispositions. The Fertitta family themselves did not signal a retreat from the equity.
The $17.6 billion Caesars deal just redrew the industry playbook. See which regional giants are now in the crosshairs for a massive take-private payout. The Catalyst to Watch Red Rock has the structure, the EBITDA, the unencumbered real estate, and a sitting controlling family who just watched their cousins monetize a sister business at a 49% premium. The first tell will be a 13D amendment or an SEC filing disclosing a sponsor partner. The second will be a quiet pause in the quarterly dividend or capex commentary on the next call. The Caesars deal redrew the regional casino playbook in a single afternoon, and Red Rock is the name with the shortest distance left to travel.
Investors interested in Gaming stocks are likely familiar with Churchill Downs (CHDN) and Red Rock Resorts (RRR). But which of these two companies is the best option for those looking for undervalued stocks?
On May 31, 2026, Ron Baron (Trades, Portfolio) executed a significant stock transaction involving Red Rock Resorts Inc RRR . This transaction saw the addition of 2,924,341 shares at a traded price of $58.40 per share. This strategic move highlights Baron's continued confidence in the gaming and entertainment company, further solidifying its position within the firm's portfolio. The acquisition reflects a calculated decision to enhance the firm's stake in a company that is modestly undervalued, according to its GF Value.
Ron Baron (Trades, Portfolio)'s Investment Philosophy Ron Baron (Trades, Portfolio) is the founder of Baron Capital Management and serves as Co-Portfolio Manager of Baron Asset Fund. Known for investing in small and mid-size growth companies, Baron employs a long-term, value-oriented investment strategy. The firm focuses on companies with open-ended growth opportunities and defensible niches, applying a bottom-up research approach. Baron typically holds investments for over five years, ignoring short-term market fluctuations when the fundamental reasons for purchasing a company remain unchanged. This disciplined approach has been a cornerstone of Baron's investment philosophy.
Red Rock Resorts Inc: A Gaming and Entertainment Leader Red Rock Resorts Inc is a prominent gaming and entertainment company based in the USA, with operations primarily in the Las Vegas valley. The company boasts a market capitalization of $3.36 billion and is considered modestly undervalued with a GF Value of $67.96. Red Rock Resorts operates strategically-located casino and entertainment properties, deriving the majority of its revenue from casinos, followed by food and beverages, rooms, and other services. The company's focus on providing a wide variety of entertainment and dining options has positioned it as a key player in the Travel & Leisure industry.
Impact of the Transaction on Baron's Portfolio The recent acquisition increased Ron Baron (Trades, Portfolio)'s holdings in Red Rock Resorts to 16,337,187 shares, representing 27.94% of the firm's portfolio. This addition had a 0.51% impact on the overall portfolio, with Red Rock Resorts now constituting 2.87% of the total holdings. The transaction underscores Baron's strategic focus on companies with strong growth potential and attractive valuations, aligning with the firm's long-term investment philosophy.
Financial Metrics and Valuation of Red Rock Resorts Red Rock Resorts has a price-to-earnings ratio of 18.45 and a GF Score of 82/100, indicating good outperformance potential. The stock is currently trading at $57.39, slightly below the GF Value, suggesting a modest undervaluation. The company's financial strength is reflected in its Balance Sheet Rank of 3/10 and a Profitability Rank of 8/10, highlighting its robust financial position and profitability.
Performance and Growth Indicators Red Rock Resorts has demonstrated a revenue growth of 7.20% over the past three years, with an operating margin growth of 14.70%. Despite a year-to-date price decline of 8.86%, the stock has gained 210.22% since its IPO in 2016. The company's strong Growth Rank of 7/10 and Momentum Rank of 7/10 further underscore its potential for continued growth and market performance.
Market Position and Other Notable Investors Besides Ron Baron (Trades, Portfolio), notable investor Joel Greenblatt (Trades, Portfolio) also holds shares in Red Rock Resorts. The stock is part of the Travel & Leisure industry, with a strong profitability rank of 8/10. This indicates a solid market position and the potential for sustained profitability. The company's strategic focus on the Las Vegas valley and its diverse revenue streams make it an attractive investment for value-oriented investors.
Conclusion: Strategic Implications of the Transaction The acquisition of additional shares in Red Rock Resorts by Ron Baron (Trades, Portfolio) reflects a strategic decision to capitalize on the company's growth potential and modest undervaluation. This move aligns with Baron's long-term investment philosophy and enhances the firm's portfolio by increasing its exposure to a leading player in the gaming and entertainment industry. The transaction underscores the firm's confidence in Red Rock Resorts' ability to deliver strong financial performance and growth in the coming years.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
Key Takeaways HRB posted Q3 adjusted EPS of $6.02, topping estimates by 5.8% and increasing 11.9% year over year.H&R Block reported $2.4 billion in revenues, up 5.3% y/y, led by tax preparation and Wave growth.HRB raised its fiscal 2026 EPS and revenue guidance above current consensus estimates. H&R Block Inc. (HRB - Free Report) reported impressive third-quarter fiscal 2026 results, with both earnings and revenues beating the Zacks Consensus Estimate.
HRB’s adjusted earnings of $6.02 per share beat the Zacks Consensus Estimate by 5.8% and increased 11.9% year over year. Revenues of $2.4 billion topped the Zacks Consensus Estimate by 2.5% and rose 5.3% year over year.
Over the past year, HRB shares have declined 49.7% compared with the industry's 24.9% decline. The Zacks S&P 500 composite has gained 33.4% in the said time frame.
HRB’s Quarterly NumbersRevenues from U.S. tax preparation and related services were $2.2 billion, up 5.1% year over year. Revenues from Financial services totaled $54.8 million, marking a marginal year-over-year rise. International revenues of $70 million rose 16%, while Wave revenues jumped 11.8% to $29.9 million.
Key Balance Sheet & Cash Flow Figures of HRBH&R Block exited the quarter with cash and cash equivalents of $867 million. Long-term debt was $1.5 billion compared with $2.4 billion at the end of the second quarter of fiscal 2026. The company generated $1.5 billion of cash in operating activities, while capital expenditures totaled $18.4 million.
Fiscal 2026 Guidance of HRBHRB guided adjusted earnings in the range of $5.10-$5.20 per share for fiscal 2026. The current Zacks Consensus Estimate for the same is $4.98.
Revenues are expected to be between $3.910 billion and $3.920 billion. The consensus estimate for the same stands at $3.89 billion.
The company guided EBITDA between $1.025 billion and $1.035 billion and an effective tax rate of 14%.
Currently, H&R Block carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Earnings SnapshotsEquifax Inc. (EFX - Free Report) reported better-than-expected first-quarter 2026 results. EFX’s adjusted earnings per share of $1.86 beat the Zacks Consensus Estimate by 10.1% and increased 21.6% from the year-ago quarter. EFX’s revenues of $1.6 billion surpassed the consensus estimate by 2.3% and improved 14.4% year over year.
Waste Connections, Inc. (WCN - Free Report) posted impressive first-quarter 2026 results. WCN’s adjusted earnings of $1.23 per share outpaced the consensus mark by 3.4% and rose 8.9% from the year-ago quarter. WCN’s total revenues of $2.37 billion beat the consensus mark by 0.7% and increased 6.4% year over year.
H&R Block remains a compelling long-term buy, trading at just 7x forward earnings despite double-digit EPS growth. HRB's Q3 FY2026 delivered a triple beat: EPS, revenue, and guidance all exceeded expectations, driving a 26% share price surge. Shareholder yield approaches 13% through aggressive buybacks and a 4.55% dividend, with further dividend increases likely in August.
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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.
It also includes access to the Zacks Style Scores.
What are the Zacks Style Scores? The Zacks Style Scores is a unique set of guidelines that rates stocks based on three popular investing types, and were developed as complementary indicators for the Zacks Rank. This combination helps investors choose securities with the highest chances of beating the market over the next 30 days.
Each stock is assigned a rating of A, B, C, D, or F based on their value, growth, and momentum characteristics. Just like in school, an A is better than a B, a B is better than a C, and so on -- that means the better the score, the better chance the stock will outperform.
The Style Scores are broken down into four categories:
Value ScoreFinding good stocks at good prices, and discovering which companies are trading under their true value, are what value investors like to focus on. So, the Value Style Score takes into account ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to highlight the most attractive and discounted stocks.
Growth ScoreGrowth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time.
Momentum ScoreMomentum trading is all about taking advantage of upward or downward trends in a stock's price or earnings outlook, and these investors live by the saying "the trend is your friend." The Momentum Style Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.
VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank The Zacks Rank is a proprietary stock-rating model that harnesses the power of earnings estimate revisions, or changes to a company's earnings expectations, to help investors build a successful portfolio.
It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +23.7% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.
This totals more than 800 top-rated stocks, and it can be overwhelming to try and pick the best stocks for you and your portfolio.
That's where the Style Scores come in.
To maximize your returns, you want to buy stocks with the highest probability of success. This means picking stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you find yourself looking at stocks with a #3 (Hold) rank, make sure they have Scores of A or B as well to ensure as much upside potential as possible.
Since the Scores were created to work together with the Zacks Rank, the direction of a stock's earnings estimate revisions should be a key factor when choosing which stocks to buy.
For instance, a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one that boasts Scores of A and B, still has a downward-trending earnings forecast, and a much greater likelihood its share price will decline as well.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: H&R Block (HRB - Free Report) H&R Block Inc. is a leading provider of tax preparation services. The company provides assisted income tax return preparation, do-it-yourself (DIY) tax solutions, and other products and services associated with income tax return preparation in the United States, Canada, and Australia. All these continuing operations are reported under a single segment.
HRB is a #1 (Strong Buy) on the Zacks Rank, with a VGM Score of A.
It also boasts a Value Style Score of A thanks to attractive valuation metrics like a forward P/E ratio of 7.28; value investors should take notice.
Two analysts revised their earnings estimate upwards in the last 60 days for fiscal 2026. The Zacks Consensus Estimate has increased $0.14 to $5.12 per share. HRB boasts an average earnings surprise of +1.8%.
With a solid Zacks Rank and top-tier Value and VGM Style Scores, HRB should be on investors' short list.
Consumer-focused stocks have faced mounting pressure in 2026 as investors weigh tariff concerns, cautious consumer spending patterns, and macroeconomic uncertainty fueled by elevated energy prices.
However, sharp pullbacks can create opportunities for value-minded investors, especially when fundamentally sound companies continue to reward shareholders with attractive dividends.
Three stocks that stand out in this regard right now are H&R Block (HRB - Free Report) ), Kohl’s (KSS - Free Report) ), and Upbound Group (UPBD - Free Report) ).
Each appears technically oversold after recent weakness, offers an enticing dividend yield above 3%, and has earned a Zacks Rank #1 (Strong Buy) thanks to a trend of positive earnings estimate revisions.
H&R Block: Oversold Tax Specialist With Reliable Income
H&R Block shares have cooled off considerably from their highs despite the company continuing to generate solid cash flow and steady earnings growth. The recent weakness has left HRB looking oversold at under $40 a share, potentially creating an attractive entry point for income-focused investors.
The tax preparation giant currently sports a dividend yield above 4.5%, making it appealing for investors seeking dependable portfolio income. H&R Block has also consistently returned cash to shareholders through buybacks as well, and implemented a double-digit dividend increase last July, bumping its quarterly payout from $0.38 per share to $0.42.
Operationally, H&R Block continues to benefit from resilient demand for assisted tax preparation services and expanding digital offerings. Recently topping earnings expectations for its fiscal third quarter earlier in the month, H&R Block has reinforced confidence in its underlying business momentum.
Most importantly for momentum investors, earnings estimates have been trending higher since the Q3 EPS beat. Zacks data shows analysts have raised current-year and next-year EPS estimates by 3% and 5%, in the last 30 days respectively, to projections of $5.12 and $5.57.
With a low forward P/E and P/S valuation, strong cash generation, and a healthy dividend, HRB could appeal to investors looking for a defensive consumer-centric stock that still appears to be oversold.
Kohl’s: Deeply Discounted Retail Play With Attractive Yield
Kohl’s has remained under pressure as investors continue to worry about discretionary retail spending trends. However, the selloff has pushed Kohl’s stock into what could end up being bargain territory at around $11 a share. Furthermore, at current levels, Kohl’s dividend yield is at an attractive 4.25% with a healthy payout ratio of around 30%.
Although retail conditions remain challenging, Kohl’s has shown signs of operational stabilization. To that point, Kohl’s most recently posted a sizable Q4 earnings surprise back in March, demonstrating that expectations may have become too pessimistic.
Kohl’s will be reporting Q1 results on Thursday, May 28, after previously posting Q4 EPS of $1.07, which was nearly 26% above expectations of $0.85 while rising from $0.95 per share a year ago.
Considering its improving earnings outlook, Kohl’s may represent a compelling turnaround candidate for contrarian investors, especially if consumer spending trends stabilize later in the year.
Upbound Group: High-Yield Opportunity Trading Near Depressed Levels
Upbound Group may be one of the most intriguing oversold income plays in the consumer space. Shares of the lease-to-own consumer household products provider and fintech-focused company have struggled amid broader concerns about lower-income consumers. This weakness has pushed Upbound’s dividend yield above 9% with UPBD trading under $20.
Despite the volatility, Upbound continues to generate solid operating performance. Upbound edged Q1 earnings expectations back in late April and maintained guidance that suggests continued profitability.
The improving earnings picture has translated into favorable analyst revisions, and income investors may also appreciate the company’s commitment to shareholder returns. While the elevated yield reflects market concerns, some analysts note that Upbound's dividend remains supported by cash flow generation.
Given Upbound’s depressed valuation of just 4X forward earnings, oversized dividend yield, and improving earnings outlook, UPBD could appeal to aggressive investors looking for a high-risk, high-reward recovery opportunity.
Summary & Final ThoughtsOversold stocks with improving earnings outlooks can often provide fertile ground for investors searching for value and income opportunities. H&R Block, Kohl’s, and Upbound Group each combine generous dividend yields with positive earnings estimate revisions strong enough to earn a Zacks Rank #1 (Strong Buy).
While consumer-focused names may remain volatile in the near term, these three stocks could reward patient investors if improving fundamentals eventually drive a rebound in sentiment.
On May 21, 2026, H&R Block Inc HRB shares fell 4.8% to a current price of $37.89. The stock has experienced a 52-week range of $28.16 to $59.05, showcasing significant volatility over the past year. Despite the recent decline, HRB has shown positive momentum over the last month, increasing by 17.3%.
GF Value™ verdict: Current price is $37.89 versus GF Value™ of $62.23, indicating a 39.1% undervaluation.GF Score™ is 74/100, which suggests the stock is above average in quality based on GuruFocus metrics.Notable signal: There have been no insider transactions in the last 3 months, indicating a lack of insider trading activity. Is HRB Overvalued or Undervalued? According to the GF Value™, H&R Block Inc HRB is significantly undervalued at its current price of $37.89 compared to the estimated fair value of $62.23. This 39.1% margin of safety presents a compelling opportunity for value-oriented investors. The GF Valuation label indicates that the stock is not only undervalued but offers a favorable risk-reward profile for potential investment.
GF Value™ is GuruFocus' proprietary measure of intrinsic value, calculated from historical trading multiples, past business growth, and future performance estimates. The current valuation suggests that HRB may be an attractive option, provided that investors consider market conditions and potential risks associated with the company's future earnings and growth prospects.
How Does HRB's Valuation Compare to Its History? Metric Current Historical P/E (TTM) 6.7x 12.2x Forward P/E 6.5x N/A The current P/E (TTM) of 6.7x is significantly below the 5-year median P/E of 12.2x, indicating that the stock is trading at a lower valuation compared to its historical averages. This analysis aligns with the GF Value™ verdict, reinforcing the view that HRB is undervalued based on historical performance metrics.
What Does HRB's GF Score™ Tell Us? Metric Rating GF Score™ 74 Financial Strength 5/10 Profitability 9/10 Growth 8/10 Valuation 4/10 Momentum 1/10 The GF Score™ of 74/100 indicates an above-average stock quality, with notable strengths in Profitability (9/10) and Growth (8/10), suggesting robust operational performance and potential for future expansion. However, the Valuation rank of 4/10 and a low Momentum rank of 1/10 signal caution, as the stock has exhibited weak price movement recently, which could hinder short-term performance.
What Are Insiders Doing with HRB Stock? There have been no insider transactions in the last three months, which suggests a lack of significant buying or selling activity by executives or board members. This inactivity could indicate that insiders are either confident in the company's future prospects or are waiting for more favorable market conditions.
What This Means for Investors Based on the GF Value™ assessment, H&R Block Inc HRB is currently undervalued. With a significant margin of safety and strong profitability metrics, it presents an interesting opportunity for potential investors looking for value stocks. However, investors should remain mindful of the overall market conditions and the company's performance moving forward.
For the complete analysis, visit the H&R Block Inc HRB stock page. You can also explore the GF Value™ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.
Frequently Asked Questions What is HRB's GF Score™?
HRB's GF Score™ is 74/100, indicating that it is above average in quality based on key metrics such as financial strength, profitability, growth, valuation, and momentum.
Is HRB overvalued or undervalued?
H&R Block Inc HRB is currently undervalued, with a GF Value™ of $62.23 compared to its price of $37.89, representing a significant margin of safety.
What is HRB's P/E ratio?
HRB's P/E (TTM) is 6.7x, which is 45% below its 5-year median P/E of 12.2x, indicating that the stock is trading at a lower valuation compared to its historical averages.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
Here are three stocks with buy ranks and strong growth characteristics for investors to consider today May 27th:
Alliance Laundry Holdings Inc. (ALH - Free Report) : This company, which is a provider of commercial laundry systems, carries a Zacks Rank #1 (Strong Buy), and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 3.2% over the last 60 days.
Alliance Laundry has a PEG ratio of 1.17 compared with 1.27 for the industry. The company possesses a Growth Score of A.
ASE Technology (ASX - Free Report) : This company, which is a provider of semiconductor manufacturing services in assembly and testing, carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 36.4% over the last 60 days.
ASE Technology has a PEG ratio of 0.78 compared with 1.71 for the industry. The company possesses a Growth Score of A.
H&R Block (HRB - Free Report) : This company, which is a leading provider of tax preparation services, carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 2.8% over the last 60 days.
H&R Block has a PEG ratio of 0.61 compared with 0.87 for the industry. The company possesses a Growth Score of B.
See the full list of top ranked stocks here.
Learn more about the Growth score and how it is calculated here.
Here are three stocks with buy ranks and strong growth characteristics for investors to consider today May 29th:
Sanmina (SANM - Free Report) : This company, which is a global provider of electronics contract manufacturing services, carries a Zacks Rank #1 (Strong Buy), and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 11.5% over the last 60 days.
Sanmina has a PEG ratio of 0.84 compared with 1.06 for the industry. The company possesses a Growth Score of A.
Alliance Laundry Holdings Inc. (ALH - Free Report) : This company, which is a provider of commercial laundry systems, carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 3.2% over the last 60 days.
Alliance Laundry has a PEG ratio of 1.17 compared with 1.27 for the industry. The company possesses a Growth Score of A.
H&R Block (HRB - Free Report) : This company, which is a leading provider of tax preparation services, carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 4% over the last 60 days.
H&R Block has a PEG ratio of 0.59 compared with 0.77 for the industry. The company possesses a Growth Score of B.
See the full list of top ranked stocks here.
Learn more about the Growth score and how it is calculated here.
Key Takeaways HRB stock has jumped 26.1% in three months, beating the industry's 22.5% return.HRB's FY26 EPS estimate rose 4% in 60 days to $5.18, suggesting 11.2% y/y growth.HRB's AI Tax Assist aided paid DIY returns; DIY generated $383.7M, 10% of FY25 revenues. Shares of H&R Block (HRB - Free Report) have jumped 26.1% over the past three months, outperforming the industry’s 22.5% return.
What Makes HRB Stock an Attractive Pick?Solid Rank: H&R Block currently sports a Zacks Rank #1 (Strong Buy) and has a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy), offer the best investment opportunities for investors. Thus, the company appears to be a compelling investment proposition at the moment.
Northward Estimate Revisions: Three estimates for fiscal 2026 moved north in the past 60 days versus no southward revision, reflecting analysts’ confidence in the company. The Zacks Consensus Estimate for fiscal 2026 earnings has moved up 4% in the past 60 days.
Strong Growth Prospects: The Zacks Consensus Estimate for HRB’s earnings is pegged at $5.18 per share, indicating 11.2% year-over-year growth. Earnings are expected to register a 9.2% increase in fiscal 2027.
AI Tax Assist Boost Top Line: HRB integrated AI Tax Assist into DIY tax preparation, which is improving its top line. This technology enhances customer experience as it aids clients who prepare a paid DIY online return without extra changes. In fiscal 2025, the company generated $383.7 million in DIY tax preparation, representing 10% of the total revenues.
Active Share Repurchases: In fiscal 2023, 2024 and 2025, the company distributed $177.9 million, $179.8 million and $197.3 million in dividends, respectively. Additionally, it returned $569 million, $379.6 million and $437.1 million through share repurchases in fiscal 2023, 2024 and 2025, respectively. This strategy improves shareholder value and their confidence in the business's long-term potential.
Solid Liquidity Profile: H&R Block’s ratio at the end of the third quarter of fiscal 2026 was 1, higher than the industry’s 0.92. While the company is positioned to precisely cover its short-term obligations, it held $887 million in cash as of the end of the third quarter of fiscal 2026, hinting at a cash-heavy balance sheet.
Image Source: Zacks Investment Research
Other Stocks to ConsiderSome other top-ranked stocks from the broader Zacks Consumer Discretionary sector are PVH Corp. (PVH - Free Report) and Flexsteel Industries, Inc. (FLXS - Free Report) , each currently flaunting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
PVH Corp has a long-term earnings growth expectation of 7.5%. PVH delivered a trailing four-quarter earnings surprise of 14.2%, on average.
Flexsteel Industries has a long-term earnings growth expectation of 12%. FLXS delivered a trailing four-quarter earnings surprise of 59%, on average.
Here are three stocks with buy ranks and strong growth characteristics for investors to consider today, June 2:
H&R Block, Inc. (HRB - Free Report) : This DIY tax return preparation services company carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 4% over the last 60 days.
H&R Block has a PEG ratio of 0.59 compared with 0.78 for the industry. The company possesses a Growth Score of B.
DaVita Inc. (DVA - Free Report) : This dialysis services company carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 6.4% over the last 60 days.
DaVita has a PEG ratio of 0.64 compared with 2.21 for the industry. The company possesses a Growth Score of B.
Lifetime Brands, Inc. (LCUT - Free Report) : This home appliances company dealing primarily in kitchenware carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 19.7% over the last 60 days.
Lifetime Brands has a PEG ratio of 0.84 compared with 1.16 for the industry. The company possesses a Growth Score of A.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Learn more about the Growth score and how it is calculated here.
Key Takeaways Rising P/E ratios often signal investor confidence, earnings strength and further upside potential. The screen identifies stocks with accelerating earnings growth and sustained price momentum. ADBE, HRB, GLBE, ADSK and INTU pair rising P/Es with strong earnings performance. Investors often opt for the stock-picking approach that involves stocks with a low price-to-earnings (P/E) ratio. This strategy is based on the notion that the lower the P/E ratio is, the higher the stock value. The reasoning behind this is straightforward — when a stock's current market price does not adequately reflect its higher earnings, it suggests potential for growth.
But there is more to this whole P/E story. Because not only low P/E, stocks with a rising P/E can also fetch strong returns. In this regard, investors can bet on the likes of Adobe (ADBE - Free Report) , H&R Block (HRB - Free Report) , Global-E Online (GLBE - Free Report) , Autodesk (ADSK - Free Report) and Intuit (INTU - Free Report) .
Rising P/E: A Useful ToolThe concept is that as earnings rise, so should the price of the stock. As forecasts for expected earnings come in higher, strong demand for the stock should continue to push up its prices. After all, astock's P/E gives an indication of how much investors are ready to shell out per dollar of earnings.
Suppose an investor wants to buy a stock with a P/E ratio of 30. This means that he is willing to shell out $30 for only $1 worth of earnings as he expects earnings of the company to rise at a faster pace in the future owing to strong fundamentals.
So, if the P/E of a stock is rising steadily, it means that investors are assured of its inherent strength and expect some strong positives out of it.
Also, studies have revealed that stocks have seen their P/E ratios jump over 100% from their breakout point in the cycle. So, if you can pick stocks early in their breakout cycle, you can end up seeing considerable gains.
The Winning StrategyIn order to shortlist stocks that are exhibiting an increasing P/E, we chose the following as our primary screening parameters.
EPS growth estimate for the current year is greater than or equal to last year’s actual growth
Percentage change in last year EPS should be greater than or equal zero
(These two criteria point to flat earnings or a growth trend over the years.)
Percentage change in price over four weeks greater than the percentage change in price over 12 weeks
Percentage change in price over 12 weeks greater than percentage change in price over 24 weeks
(These two criteria show that price of the stock is increasing consistently over the said timeframes.)
Percentage price change for four weeks relative to the S&P 500 greater than the percentage price change for 12 weeks relative to the S&P 500
Percentage price change for 12 weeks relative to the S&P 500 greater than the percentage price change for 24 weeks relative to the S&P 500
(Here, the case for consistent price gains gets even stronger as it displays percentage price changes relative to the S&P 500.)
Percentage price change for 12 weeks is 20% higher than or equal to the percentage price change for 24 weeks, but it should not exceed 100%
(A 20% increase in the price of a stock from the breakout point gives cues of an impending uptrend. But a jump of over 100% indicates that there is limited scope for further upside and that the stock might be due for a reversal.)
In addition, we place a few other criteria that lead us to some likely outperformers.
Zacks Rank less than or equal to 2: Only companies with a Zacks Rank #1 (Strong Buy) or 2 (Buy) can get through.
Average 20-day Volume greater than or equal to 50,000: High trading volume implies that the stocks have adequate liquidity.
Just these few criteria narrowed down the universe from over 7,700 stocks to just 65.
Here are five out of the 65 stocks:
Adobe: This leading technology company, currently with a Zacks Rank #2 (Buy),offers a personalized digital experience through the infusion of artificial intelligence (AI) in its solutions. You can see the complete list of today’s Zacks #1 Rank stocks here.
The average four-quarter earnings surprise of ADBE is 2.46%.
H&R Block: The Zacks Rank #1 company is a leading provider of tax preparation services.
The average four-quarter earnings surprise of HRB is 1.75%.
Global-E Online: The Zacks Rank #2 company provides a platform to enable and accelerate global, direct-to-consumer cross-border e-commerce.
The average four-quarter earnings surprise of GLBE is 56.95%.
Autodesk: The Zacks Rank #2 develops model-based design, engineering and documentation software. The company serves customers in architecture, engineering and construction; product design and manufacturing; and digital media and entertainment industries.
The average four-quarter earnings surprise of ADSK is 7.07%.
Intuit: The Zacks Rank #2 business and financial software company develops and sells financial, accounting and tax preparation software, and related services for small businesses, consumers and accounting professionals globally.
The average four-quarter earnings surprise of INTU is 6.87%.
Here are three stocks with buy ranks and strong growth characteristics for investors to consider today, June 4:
H&R Block, Inc. (HRB - Free Report) : This DIY tax return preparation services company carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 4% over the last 60 days.
H&R Block has a PEG ratio of 0.60 compared with 0.76 for the industry. The company possesses a Growth Score of B.
DaVita Inc. (DVA - Free Report) : This dialysis services company carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 6.4% over the last 60 days.
DaVita has a PEG ratio of 0.62 compared with 2.15 for the industry. The company possesses a Growth Score of B.
Valero Energy Corporation (VLO - Free Report) : This transportation fuels and petrochemical products company carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 67.2% over the last 60 days.
Vareo has a PEG ratio of 0.38 compared with 0.49 for the industry. The company possesses a Growth Score of B.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Learn more about the Growth score and how it is calculated here.
It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.
Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor.
It also includes access to the Zacks Style Scores.
What are the Zacks Style Scores? The Zacks Style Scores is a unique set of guidelines that rates stocks based on three popular investing types, and were developed as complementary indicators for the Zacks Rank. This combination helps investors choose securities with the highest chances of beating the market over the next 30 days.
Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.
The Style Scores are broken down into four categories:
Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.
Growth ScoreGrowth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time.
Momentum ScoreMomentum traders and investors live by the saying "the trend is your friend." This investing style is all about taking advantage of upward or downward trends in a stock's price or earnings outlook. Employing factors like one-week price change and the monthly percentage change in earnings estimates, the Momentum Style Score can indicate favorable times to build a position in high-momentum stocks.
VGM ScoreIf you want a combination of all three Style Scores, then the VGM Score will be your friend. It rates each stock on their combined weighted styles, helping you find the companies with the most attractive value, best growth forecast, and most promising momentum. It's also one of the best indicators to use with the Zacks Rank.
How Style Scores Work with the Zacks Rank The Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.
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.
Since the Scores were created to work together with the Zacks Rank, the direction of a stock's earnings estimate revisions should be a key factor when choosing 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: H&R Block (HRB - Free Report) H&R Block Inc. is a leading provider of tax preparation services. The company provides assisted income tax return preparation, do-it-yourself (DIY) tax solutions, and other products and services associated with income tax return preparation in the United States, Canada, and Australia. All these continuing operations are reported under a single segment.
HRB is a #1 (Strong Buy) on the Zacks Rank, with a VGM Score of A.
It also boasts a Value Style Score of A thanks to attractive valuation metrics like a forward P/E ratio of 7.33; value investors should take notice.
Three analysts revised their earnings estimate upwards in the last 60 days for fiscal 2026. The Zacks Consensus Estimate has increased $0.20 to $5.18 per share. HRB boasts an average earnings surprise of +1.8%.
With a solid Zacks Rank and top-tier Value and VGM Style Scores, HRB should be on investors' short list.
Here are three stocks with buy ranks and strong growth characteristics for investors to consider today June 5th:
Pitney Bowes (PBI - Free Report) : This global technology company, which is powering billions of transactions - physical and digital - in the connected and borderless world of commerce, carries a Zacks Rank #1 (Strong Buy), and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 11% over the last 60 days.
Pitney Bowes has a PEG ratio of 0.75 compared with 0.91 for the industry. The company possesses a Growth Score of A.
Centene (CNC - Free Report) : This well-diversified healthcare company, that primarily provides a set of services to the government sponsored healthcare programs, carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 15.3% over the last 60 days.
Centene has a PEG ratio of 0.49 compared with 1.05 for the industry. The company possesses a Growth Score of A.
H&R Block (HRB - Free Report) : This company, which is a leading provider of tax preparation services, carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 4% over the last 60 days.
H&R Block has a PEG ratio of 0.58 compared with 1.12 for the industry. The company possesses a Growth Score of B.
See the full list of top ranked stocks here.
Learn more about the Growth score and how it is calculated here.
It has been about a month since the last earnings report for H&R Block (HRB - Free Report) . Shares have added about 3.3% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is H&R Block due for a pullback? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent catalysts for H&R Block, Inc. before we dive into how investors and analysts have reacted as of late.
H&R Block Reports Q3 Earnings BeatH&R Block reported impressive third-quarter fiscal 2026 results, with both earnings and revenues beating the Zacks Consensus Estimate.
HRB’s adjusted earnings of $6.02 per share beat the Zacks Consensus Estimate by 5.8% and increased 11.9% year over year. Revenues of $2.4 billion topped the Zacks Consensus Estimate by 2.5% and rose 5.3% year over year.
HRB’s Quarterly NumbersRevenues from U.S. tax preparation and related services were $2.2 billion, up 5.1% year over year. Revenues from Financial services totaled $54.8 million, marking a marginal year-over-year rise. International revenues of $70 million rose 16%, while Wave revenues jumped 11.8% to $29.9 million.
Key Balance Sheet & Cash Flow FiguresH&R Block exited the quarter with cash and cash equivalents of $867 million. Long-term debt was $1.5 billion compared with $2.4 billion at the end of the second quarter of fiscal 2026. The company generated $1.5 billion of cash in operating activities, while capital expenditures totaled $18.4 million.
HRB’s FY26 OutlookHRB guided adjusted earnings in the range of $5.10-$5.20 per share for fiscal 2026. Revenues are expected to be between $3.910 billion and $3.920 billion.
The company guided EBITDA between $1.025 billion and $1.035 billion and an effective tax rate of 14%.
How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -6.43% due to these changes.
VGM ScoresCurrently, H&R Block has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a score of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
OutlookEstimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, H&R Block has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry PlayerH&R Block belongs to the Zacks Consumer Services - Miscellaneous industry. Another stock from the same industry, Cimpress (CMPR - Free Report) , has gained 5.4% over the past month. More than a month has passed since the company reported results for the quarter ended March 2026.
Cimpress reported revenues of $886.21 million in the last reported quarter, representing a year-over-year change of +12.3%. EPS of $0.55 for the same period compares with -$0.33 a year ago.
Cimpress is expected to post earnings of $1.00 per share for the current quarter, representing a year-over-year change of +198%. Over the last 30 days, the Zacks Consensus Estimate has changed +0.5%.
Cimpress has a Zacks Rank #1 (Strong Buy) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of A.
Here are three stocks with buy ranks and strong growth characteristics for investors to consider today, June 8:
Valero Energy Corporation (VLO - Free Report) : This energy company carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 55.2% over the last 60 days.
Valero has a PEG ratio of 0.38 compared with 0.49 for the industry. The company possesses a Growth Score of B.
H&R Block, Inc. (HRB - Free Report) : This DIY tax return preparation services company carriesa Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 4% over the last 60 days.
H&R Block has a PEG ratio of 0.59 compared with 1.06X for the industry. The company possesses a Growth Score of A.
Marathon Petroleum Corporation (MPC - Free Report) : This integrated downstream energy company carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 53.5% over the last 60 days.
Marathon Petroleum has a PEG ratio of 0.42 compared with 0.49 for the industry. The company possesses a Growth Score of B.
See the full list of top-ranked stocks here.
Learn more about the Growth score and how it is calculated here.
Key Takeaways AI valuation concerns are rising as investors reassess lofty earnings multiples and spending levels.Rising infrastructure costs, critical-mineral demand and geopolitical risks may pressure AI investments.CrossAmerica Partners, Global Partners, H&R Block and B&G Foods offer attractive shareholder yields. Artificial intelligence remains the dominant investment theme of 2026, but the spectacular rally in AI-linked stocks is increasingly raising concerns about stretched valuations. Investors have poured capital into semiconductor makers, hyperscalers and Artificial Intelligence (AI) software firms on expectations of transformative long-term growth. However, recent market action suggests that enthusiasm may be running ahead of fundamentals.
Reuters recently reported that technology shares sold off sharply as investors reassessed lofty AI-related valuations amid changing interest-rate expectations. Market participants cited elevated earnings multiples, concentration of capital in a handful of AI leaders and growing speculative activity in private AI companies as key sources of vulnerability. Reuters also noted that concerns are rising over whether massive AI spending can generate returns quickly enough to justify current valuations.
Skepticism is not centered on AI's ability to reshape the global economy, but on whether equity markets have already priced in much of the anticipated growth. Against this backdrop, companies with a proven track record of returning cash to shareholders may offer greater resilience.
Stocks with strong shareholder yield not only provide income through dividends but also support valuations through buybacks and disciplined capital allocation. As geopolitical risks and AI volatility persist in 2026, these companies may serve as an important anchor for investor portfolios navigating turbulent markets.
Among companies offering attractive shareholder yields are H&R Block (HRB - Free Report) , Global Partners (GLP - Free Report) , CrossAmerica Partners (CAPL - Free Report) and B&G Foods (BGS - Free Report) . These stocks also carry favorable Zacks Ranks and Style Scores, suggesting potential upside in their share prices this year and enhancing their ability to generate long-term shareholder value.
What Is Driving Premium AI Valuations?The premium valuations assigned to AI-related companies are being fueled by an unprecedented surge in capital spending. Leading technology firms are investing heavily in semiconductors, cloud infrastructure, data centers and AI models as they compete to establish long-term leadership positions.
Reuters reported that major technology companies are engaged in an escalating competition for AI talent, computing power and infrastructure. The race has prompted record investment commitments from companies such as Microsoft, Alphabet, Meta Platforms, Amazon and Nvidia. At the same time, AI-related private companies continue to command extraordinary valuations as investors chase exposure to the sector’s growth potential.
Demand forecasts remain compelling. The U.S. Energy Information Administration projects power consumption to reach new records in 2026 and 2027, driven in part by surging demand from AI data centers. Reuters also reported that AI, robotics and defense applications are expected to drive a 50% increase in global copper demand by 2040, highlighting the scale of infrastructure required to support the AI revolution.
Rising Input Costs and Geopolitical Risks Add PressureWhile AI growth prospects remain attractive, the sector faces mounting cost pressures.
Copper, rare earth elements and other critical minerals are becoming increasingly important inputs for AI infrastructure. Reuters reported that demand for strategic minerals is accelerating as governments and corporations compete to secure supply chains for advanced technologies and defense systems. Industry analysts continue to warn about potential shortages of critical materials required for data centers, power infrastructure and semiconductor production.
Geopolitical risks are creating additional uncertainty. Competition for critical minerals, export controls, supply-chain realignment and regional conflicts continue to threaten the stability of global technology supply chains. These risks could lead to higher operating costs and lower returns on massive AI infrastructure investments.
Why Shareholder Yield Matters in This EnvironmentAs valuation concerns grow, investors may increasingly favor companies with strong shareholder yield rather than firms relying solely on future growth expectations.
Shareholder yield combines dividend payments, share repurchases and debt reduction to measure the total capital returned to investors. Companies with strong shareholder yield typically generate substantial free cash flow, maintain healthy balance sheets and demonstrate disciplined capital allocation.
These characteristics become particularly valuable when market leadership is concentrated and valuation risk is high. Dividend income can help cushion portfolio volatility, while buybacks support earnings per share and provide a degree of downside protection. Debt reduction further strengthens financial flexibility during uncertain periods.
In contrast to highly valued growth stocks whose returns depend heavily on future expectations, shareholder-yield companies provide investors with a tangible source of return.
A More Balanced Approach to 2026The long-term AI opportunity remains significant, but rising valuation concerns, increasing infrastructure costs and growing geopolitical risks suggest investors should remain selective. As markets become more sensitive to earnings delivery and return on investment, companies with strong shareholder yield may offer a useful counterbalance to expensive growth stocks.
By combining dividends, buybacks and balance-sheet strength, shareholder-yield companies provide a measure of stability that can help investors weather volatility while still participating in long-term wealth creation.
Our Shareholder Yield Screen makes it easy to identify high-potential stocks at any given time — just like the ones mentioned above.
Ready to uncover more transformative thematic investment ideas? Explore 37 cutting-edge investment themes with Zacks Thematic Screens and discover your next big opportunity.
4 Stocks With Strong Shareholders’ YieldH&R Block stands out as a strong candidate for high shareholder yield due to its attractive dividend payments, consistent share buybacks and effective debt management. The company offers a good dividend yield of around 4.41%.
HRB has increased its dividend payout five times in the past five years, reflecting an annualized dividend growth rate of 11.2%. The payout ratio of 32% indicates that the company is paying less than its income, which is sustainable over the long term. This also reflects that Eni is keeping funds for better investment opportunities.
H&R Block has also repurchased shares worth $400.1 million in the first nine months of fiscal 2026, preceded by another $400.1 million worth of repurchase in fiscal 2025. The company currently has remaining authorization of $700 million. It also reduced its long-term debt from $1.98 billion (in 2021) to $1.49 billion (as of March 2026-end).
H&R Block’s shareholder yield remains impressive, making it a compelling choice for investors seeking a combination of income and capital appreciation while benefiting from disciplined capital allocation.
HRB currently sports a Zacks Rank #1 (Strong Buy) and a Zacks VGM Score of A, implying strong potential for continued uptrend. You can see the complete list of today’s Zacks #1 Rank stocks here.
Image Source: Zacks Investment Research
General Partners owns, controls or has access to one of the largest terminal networks of refined petroleum products in New England. The company can offer stability to investors’ portfolios through its strong shareholder yield. It offers a dividend yield of around 6.23%.
GLP has increased its dividend payout 17 times in the past five years, reflecting an annualized dividend growth rate of 7.1%. The payout ratio of 84% indicates that the company is paying less than its income, which is sustainable over the long term. This also reflects that GLP is keeping funds for better investment opportunities.
The company has repurchased 1,734,658 common units since launching its repurchase program in May 2009 through Dec. 31, 2025. As of Feb. 27, 2026, it remained authorized to repurchase up to an additional 865,929 common units. The company has also strengthened its balance sheet, reducing long-term debt from $1.68 billion in 2024 to $1.65 billion as of March 31, 2026.
General Partners’ shareholder yield remains impressive, making it a compelling choice for investors seeking a combination of income and capital appreciation while benefiting from disciplined capital allocation.
GLP currently flaunts a Zacks Rank of 1 and a Zacks VGM Score of B, implying strong upside potential.
Image Source: Zacks Investment Research
CrossAmerica Partners engages in the wholesale distribution of motor fuels, with the potential to offer stability amid rising volatility through its attractive dividend payments and effective debt management. The company offers a solid dividend yield of around 9.5%.
It has also reduced its long-term debt from $1.62 billion in 2021 to $726 million as of March 2026-end.
CAPL’s shareholder yield remains impressive, making it a compelling choice for investors seeking a combination of income and capital appreciation while benefiting from disciplined capital allocation.
CrossAmerica Partners currently sports a Zacks Rank #1 and a Zacks VGM Score of A, implying continued upside potential.
Image Source: Zacks Investment Research
B&G Foods is another strong candidate for high shareholder yield due to its attractive dividend payments and effective debt management. The company offers a solid dividend yield of around 19.49%.
It has also reduced its long-term debt from $2.34 billion in 2022 to $2 billion as of March 2026-end.
B&G Foods’ shareholder yield remains impressive, making it a compelling choice for investors seeking a combination of income and capital appreciation while benefiting from disciplined capital allocation.
BGS currently carries a Zacks Rank of 2 and a Zacks VGM Score of A, implying moderate upside potential for the stock.
DaVita Inc. (DVA - Free Report) : This kidney dialysis company has a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 6.4% over the last 60 days.
DaVita Inc. has a PEG ratio of 0.65 compared with 2.13 for the industry. The company possesses a Growth Score of A.
H&R Block, Inc. (HRB - Free Report) : This DIY tax return preparation services company carriesa Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 4% over the last 60 days.
H&R Block has a PEG ratio of 0.59 compared with 1.05 for the industry. The company possesses a Growth Score of A.
Pitney Bowes Inc. (PBI - Free Report) : This shipping and mailing services company carries a Zacks Rank #1, and has witnessed the Zacks Consensus Estimate for its current year earnings increasing 11% over the last 60 days.
Pitney Bowes has a PEG ratio of 0.75 compared with 0.86 for the industry. The company possesses a Growth Score of A.
See the full list of top ranked stocks here.
Learn more about the Growth score and how it is calculated here.
H&R Block (HRB - Free Report) appears an attractive pick, as it has been recently upgraded to a Zacks Rank #1 (Strong Buy). This upgrade primarily reflects an upward trend in earnings estimates, which is one of the most powerful forces impacting stock prices.
The sole determinant of the Zacks rating is a company's changing earnings picture. The Zacks Consensus Estimate -- the consensus of EPS estimates from the sell-side analysts covering the stock -- for the current and following years is tracked by the system.
The power of a changing earnings picture in determining near-term stock price movements makes the Zacks rating system highly useful for individual investors, since it can be difficult to make decisions based on rating upgrades by Wall Street analysts. These are mostly driven by subjective factors that are hard to see and measure in real time.
Therefore, the Zacks rating upgrade for H&R Block basically reflects positivity about its earnings outlook that could translate into buying pressure and an increase in its stock price.
Most Powerful Force Impacting Stock PricesThe change in a company's future earnings potential, as reflected in earnings estimate revisions, has proven to be strongly correlated with the near-term price movement of its stock. The influence of institutional investors has a partial contribution to this relationship, as these big professionals use earnings and earnings estimates to calculate the fair value of a company's shares. An increase or decrease in earnings estimates in their valuation models simply results in higher or lower fair value for a stock, and institutional investors typically buy or sell it. Their transaction of large amounts of shares then leads to price movement for the stock.
Fundamentally speaking, rising earnings estimates and the consequent rating upgrade for H&R Block imply an improvement in the company's underlying business. Investors should show their appreciation for this improving business trend by pushing the stock higher.
Harnessing the Power of Earnings Estimate RevisionsAs empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock movements, tracking such revisions for making an investment decision could be truly rewarding. Here is where the tried-and-tested Zacks Rank stock-rating system plays an important role, as it effectively harnesses the power of earnings estimate revisions.
The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here >>>> .
Earnings Estimate Revisions for H&R BlockThis tax preparer is expected to earn $5.18 per share for the fiscal year ending June 2026, which represents no year-over-year change.
Analysts have been steadily raising their estimates for H&R Block. Over the past three months, the Zacks Consensus Estimate for the company has increased 3.9%.
Bottom LineUnlike the overly optimistic Wall Street analysts whose rating systems tend to be weighted toward favorable recommendations, the Zacks rating system maintains an equal proportion of "buy" and "sell" ratings for its entire universe of more than 4,000 stocks at any point in time. Irrespective of market conditions, only the top 5% of the Zacks-covered stocks get a "Strong Buy" rating and the next 15% get a "Buy" rating. So, the placement of a stock in the top 20% of the Zacks-covered stocks indicates its superior earnings estimate revision feature, making it a solid candidate for producing market-beating returns in the near term.
You can learn more about the Zacks Rank here >>>
The upgrade of H&R Block to a Zacks Rank #1 positions it in the top 5% of the Zacks-covered stocks in terms of estimate revisions, implying that the stock might move higher in the near term.
First Trust Advisors LP lifted its position in shares of J and J Snack Foods Corp. (NASDAQ: JJSF) by 19.9% during the undefined quarter, according to its most recent filing with the Securities and Exchange Commission. The institutional investor owned 404,461 shares of the company's stock after purchasing an additional 67,028 shares during
The cost of GLP-1 drugs is falling, and pill versions are hitting the U.S. market. For restaurant chains and snacking giants, higher adoption of weight loss and diabetes treatments poses a threat to their sales — or an opportunity.
GLP-1 drugs slow digestion, suppress users' appetites and increase satiety. For many restaurants and packaged food manufacturers, those reactions will likely mean weaker sales. Adults who use GLP-1s consume 21% fewer calories and spend nearly a third less on grocery bills on average, according to KPMG. JPMorgan estimates the growing use of the medications could wipe out $30 billion to $55 billion in annual sales for the food and beverage industry as soon as 2030.
About one in every eight U.S. adults is currently taking a GLP-1 drug like Ozempic or Zepbound, according to the KFF Health Tracking Poll conducted from Oct. 27 to Nov. 2. That number doesn't include consumers who have discontinued their use of the drugs; 18% of respondents said that they have taken a GLP-1 medication at some point.
Those numbers are expected to keep climbing, especially after Novo Nordisk launched its Wegovy pill in January and Eli Lilly prepares to roll out its own oral drug this year. By 2030, more than 30 million Americans could be on a GLP-1 treatment, up from 10 million in 2026, based on J.P. Morgan estimates.
But the shift also presents an opportunity for restaurants and food and beverage companies.
With new protein- and fiber-rich options, many businesses are hoping to win over GLP-1 consumers and mollify investors' concerns about how the treatments will affect their bottom lines.
"Whether it is labeling as GLP-1 friendly, decreasing the serving size, emphasizing protein content, or even when you shift over to the beverage world, because hydration is certainly a concern, there are a number of players that are starting to react to this," said Don K. Johnson, principal of strategy and execution for EY-Parthenon.
Skipping snacks and breakfastAbout half of GLP-1 users report consuming fewer calories while taking the medications, according to UBS Evidence Lab. But the effects aren't even across the industry, and "certain categories are more impacted than others," Johnson said.
Snacking, once one of the fastest-growing grocery segments, has taken the biggest hit. About 70% of GLP-1 users who report consuming fewer calories said that they are snacking less, according to a survey conducted by EY-Parthenon last spring.
"I think it is about the specific type of snack, but I do think they're also snacking less ... Having said that, we do see that there is a shift to healthier foods, and that certainly will include healthier snacking," Johnson said.
Think more yogurt, nuts or fruit, and fewer chips or pretzels.
Since GLP-1 drugs lead patients to lower their caloric intake, every calorie consumed means more. Protein intake is more important to prevent muscle loss. So, too, is fiber to support gut health and digestion. And staying hydrated helps mitigate some of the drugs' side effects, like nausea and headaches.
The effects of eating less extend to restaurants. About 60% of those respondents to the EY-Parthenon survey said that they are dining out less frequently.
The shift could also hit full-service restaurants where diners order a drink with their meals. Roughly 45% of survey respondents who are eating and drinking less said that they are drinking less alcohol.
Surveys conducted by Bernstein indicate that the frequency of restaurant visits among GLP-1 users can fall by as much as 45%, depending on the category of food and the nature of the occasion, analyst Danilo Gargiulo of Bernstein wrote in a research note published on Tuesday.
The pullback in restaurant visits isn't spread evenly across times of day, according to Dana Baggett, executive director of restaurant client strategy at RRD, which works with more than 200 restaurant brands.
Lunch, so far, hasn't been impacted, she said. But breakfast has taken a hit, particularly from high-income GLP-1 users, who represent a bigger percentage of current patients, she said. In practice, that means fewer sugary coffee drinks and doughnuts, although options like Starbucks' protein cold foam could encourage those consumers to return.
Dinner, especially at fast-food restaurants, has taken the brunt of the damage so far.
Dinner traffic has fallen 6% among consumers who have been taking the medication regularly, according to Baggett; in other words, overall restaurant sales during dinner hours have declined about 0.4% due to GLP-1 use, she said. But as the number of consumers who use the drug consistently grows, so too will the pressure on restaurant traffic.
And snacking isn't confined to grocery store aisles. For limited-service restaurants, like McDonald's or Taco Bell, snacking accounts for 12% of spending, according to Bank of America Global Research.
Even so, threats to those large restaurants chains may only be gradual, which gives them time to adapt.
"I think there shouldn't be this panic out there in the marketplace, but this is a trend that's not going away," Baggett said. "This is an amazing opportunity for brands to start repositioning themselves and focusing on what consumers want: less sugar, higher protein and that focus on fiber."
How Big Food is evolvingIf recent earnings conference calls are any example, restaurant and food executives also think that it isn't time to panic just yet. For some companies, the trend offers a chance to reach new customers through healthier options.
"I think there are more opportunities than threats, but there are both," PepsiCo CEO Ramon Laguarta told Wall Street analysts on the company's earnings conference call in early February.
In recent months, Pepsi has released protein-packed Doritos, relaunched Gatorade and unveiled fiber-rich varieties of SunChips and Smartfood popcorn. Those moves are part of the company's broader strategy to modernize its portfolio and boost sales by appealing to health-conscious consumers, but they also align with Laguarta's assumption that GLP-1 medications will be adopted more broadly.
Domino's Pizza CEO Russell Weiner sounded unshaken when he told analysts last month that the pizza chain hasn't seen GLP-1 drugs affect its sales yet.
"Dinner, for us, is a sharing occasion, so perhaps that's why we're not seeing any impact, but we're going to continue to watch it," he said. "But if there needs to be menu innovation around that, we will do that."
RRD's Baggett told CNBC that she thinks portions and snack sizing will be key for restaurants to attract consumers who are on GLP-1 treatments.
When asked about the drugs on McDonald's earnings conference call last month, CEO Chris Kempczinski touted the burger chain's existing protein options. But he added that the preferences of GLP-1 users are also being considered as the chain creates new menu items.
"We're also seeing changes around maybe less snacking, changes in some of the beverages that they drink, less sugary drinks, and so all of those things are factoring into some of what we're out there experimenting with and testing with," he said.
Other restaurant chains have already launched options that appeal to diners on GLP-1 drugs, even if the medications weren't the key impetus. For example, Chipotle launched grab-and-go protein cups in December, aiming to cash in on the protein and snacking crazes as its restaurant sales struggled.
And Olive Garden, owned by Darden Restaurants, released a Lighter Portions menu last year, downsizing a handful of its classic entrees at a lower price. Darden CEO Rick Cardenas said that the chain introduced the new menu to give all of its customers more options.
"It just so happens to benefit the consumers that might want smaller portions that are on GLP-1 medications, and we have a lot of options like that in all of our menus," Cardenas said on the company's earnings conference call in December.
Marketing to GLP-1 usersOther companies have explicitly appealed to GLP-1 users, particularly when it comes to innovation.
In 2024, Nestle led the pack when it launched Vital Pursuit, a frozen-food brand targeting GLP-1 users. While the packaging initially didn't call out that it was "GLP-1 friendly," the food company updated it later to include it prominently, boosting sales.
"It's a big initiative for Nestle," Nestle USA CEO Marty Thompson told CNBC at a media event earlier in March. "There will be those things that are designed for GLP-1, and there will be those things that will be sort of a companion to GLP-1, clearly calling out protein and fiber, but not necessarily designed portion-size wise or whatever for GLP-1."
Nestle's focus will extend beyond food, too. Thompson said that the company plans to expand into beverages and listed protein shakes as one potential way to appeal to GLP-1 customers.
Even food companies without much exposure to GLP-1 users are broadening their portfolios to reach them.
For example, Dippin' Dots and Icee owner J&J Snack Foods makes most of its sales in stadiums, theme parks and malls. Because of its "experiential" focus, CEO Dan Fachner told CNBC that he thinks that J&J is more insulated from the effect of GLP-1 drugs compared with its snacking peers.
"I still think that in most cases, even people on GLP-1 drugs will still use those occasions for snacking," he said.
Even still, more than a year ago, Fachner presented employees with a challenge for the company's grocery business, which accounts for 13.5% of annual sales.
"Take the core products — pretzels and churros and Icees and Dippin' Dots and frozen novelties — tell me how we can make them more GLP-1 friendly as it continues to grow," he said.
This year, J&J has a number of new products hitting the freezer aisle. Protein has been added to its soft pretzels, now available in a smaller portion size. And Luigi's Italian Ice, traditionally sold in a cup, will come in a "mini pop size," with a formula that includes more antioxidants or helps hydration, according to Fachner. If the new products succeed in grocery stores, then J&J plans to take them to the company's food service customers, as well.
J&J's new products also have the benefit of appealing to a wider audience than just consumers who are on GLP-1 medication. For example, Fachner expects the new Luigi's mini pops will appeal to health-conscious moms as a snack for their kids.
Uptake could change strategiesFor restaurants and food suppliers, current data on the eating and drinking habits of GLP-1 users are informing their efforts to appeal to those consumers. But that behavior can still fluctuate.
About 5% of users lapse in taking the medications, due to cost, side effects or hitting their weight goal. After quitting, they tend to maintain the same eating habits for a couple of months before eventually returning to a higher caloric intake.
"I think that we don't spend enough time talking about the fact that there may be sort of a cycle of behaviors — people going on and off of the drugs — that will have sort of an interesting impact on manufacturers of food because there's no 'before' and 'after,'" EY's Johnson said. "It's a process."
And a whole new group of consumers could soon be taking daily pill versions of GLP-1 medications. It's too soon to tell if oral GLP-1 drugs will result in more consistent usage or higher quit rates and to know who exactly is trying the pill version over the injectable.
"I don't have a crystal ball, but my guess is from our survey that the folks using the oral version of the drug will be a new set of people, because one of the barriers to trial was — as can be expected — a lot of people don't like to take shots of injections," Johnson said.
There is one prediction that is widely accepted: the pill version will mean much higher adoption of GLP-1 drugs.
DAVENPORT and Co LLC trimmed its position in shares of J and J Snack Foods Corp. (NASDAQ: JJSF) by 5.6% during the undefined quarter, according to its most recent 13F filing with the Securities and Exchange Commission (SEC). The firm owned 233,408 shares of the company's stock after selling 13,836 shares during the
Allspring Global Investments Holdings LLC lifted its position in shares of J & J Snack Foods Corp. (NASDAQ:JJSF – Free Report) by 1.6% during the fourth quarter, according to the company in its most recent Form 13F filing with the Securities & Exchange Commission. The firm owned 1,739,411 shares of the company’s stock after acquiring an additional 26,975 shares during the quarter. Allspring Global Investments Holdings LLC owned 9.16% of J & J Snack Foods worth $157,451,000 at the end of the most recent quarter.
A number of other institutional investors and hedge funds have also recently bought and sold shares of the business. Ballentine Partners LLC grew its position in J & J Snack Foods by 6.1% in the third quarter. Ballentine Partners LLC now owns 2,195 shares of the company’s stock worth $211,000 after buying an additional 127 shares during the last quarter. Nicolet Advisory Services LLC increased its position in J & J Snack Foods by 5.8% in the 3rd quarter. Nicolet Advisory Services LLC now owns 2,592 shares of the company’s stock worth $246,000 after purchasing an additional 143 shares during the last quarter. RK Asset Management LLC raised its stake in shares of J & J Snack Foods by 0.5% during the 3rd quarter. RK Asset Management LLC now owns 29,948 shares of the company’s stock worth $2,878,000 after purchasing an additional 144 shares in the last quarter. Amalgamated Bank raised its stake in shares of J & J Snack Foods by 3.5% during the 3rd quarter. Amalgamated Bank now owns 4,584 shares of the company’s stock worth $440,000 after purchasing an additional 153 shares in the last quarter. Finally, GAMMA Investing LLC lifted its stake in J & J Snack Foods by 38.0% in the third quarter. GAMMA Investing LLC now owns 966 shares of the company’s stock valued at $93,000 after acquiring an additional 266 shares during the last quarter. Institutional investors and hedge funds own 76.04% of the company’s stock.
Wall Street Analyst Weigh In JJSF has been the topic of a number of recent research reports. Weiss Ratings restated a “sell (d+)” rating on shares of J & J Snack Foods in a report on Friday. Benchmark reiterated a “buy” rating on shares of J & J Snack Foods in a report on Tuesday, January 20th. Finally, Zacks Research downgraded shares of J & J Snack Foods from a “strong-buy” rating to a “hold” rating in a research report on Monday, January 19th. One research analyst has rated the stock with a Buy rating, one has assigned a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat, the stock presently has a consensus rating of “Hold” and a consensus target price of $130.00.
Check Out Our Latest Research Report on J & J Snack Foods
J & J Snack Foods Stock Up 1.1% Shares of JJSF stock opened at $80.70 on Tuesday. J & J Snack Foods Corp. has a 12 month low of $73.75 and a 12 month high of $142.69. The company has a market cap of $1.53 billion, a PE ratio of 25.70 and a beta of 0.34. The business’s 50 day moving average is $85.05 and its two-hundred day moving average is $89.80.
J & J Snack Foods (NASDAQ:JJSF – Get Free Report) last issued its quarterly earnings data on Tuesday, February 3rd. The company reported $0.33 earnings per share for the quarter, topping analysts’ consensus estimates of $0.32 by $0.01. The business had revenue of $343.78 million during the quarter, compared to analysts’ expectations of $365.95 million. J & J Snack Foods had a net margin of 3.92% and a return on equity of 8.79%. J & J Snack Foods’s revenue for the quarter was down 5.2% on a year-over-year basis. During the same period in the previous year, the company earned $0.33 earnings per share. As a group, equities analysts expect that J & J Snack Foods Corp. will post 4.75 EPS for the current fiscal year.
J & J Snack Foods Dividend Announcement The company also recently announced a quarterly dividend, which will be paid on Tuesday, April 7th. Shareholders of record on Tuesday, March 17th will be given a dividend of $0.80 per share. The ex-dividend date of this dividend is Tuesday, March 17th. This represents a $3.20 dividend on an annualized basis and a yield of 4.0%. J & J Snack Foods’s payout ratio is currently 101.91%.
J & J Snack Foods announced that its Board of Directors has initiated a stock buyback plan on Tuesday, February 3rd that allows the company to repurchase $50.00 million in outstanding shares. This repurchase authorization allows the company to purchase up to 2.8% of its shares through open market purchases. Shares repurchase plans are typically an indication that the company’s board believes its stock is undervalued.
J & J Snack Foods Company Profile (Free Report)
J & J Snack Foods (NASDAQ: JJSF) is a U.S.-based manufacturer and distributor of branded snack foods and frozen beverages. Headquartered in Pennsauken, New Jersey, the company develops, produces and markets a broad array of proprietary and licensed products for retail, concession and foodservice customers. Its offerings span soft pretzels, frozen novelties, real Italian ice, churros and packaged beverages under well-known names such as ICEE, SuperPretzel, Luigi’s and ChurroMan.
Founded in 1971 by Gerald B.
Featured Articles Five stocks we like better than J & J Snack Foods Want to see what other hedge funds are holding JJSF? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for J & J Snack Foods Corp. (NASDAQ:JJSF – Free Report).
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Phocas Financial Corp. purchased a new stake in shares of J & J Snack Foods Corp. (NASDAQ:JJSF – Free Report) in the 4th quarter, according to its most recent Form 13F filing with the Securities & Exchange Commission. The institutional investor purchased 40,358 shares of the company’s stock, valued at approximately $3,647,000. Phocas Financial Corp. owned about 0.21% of J & J Snack Foods as of its most recent filing with the Securities & Exchange Commission.
Other institutional investors have also modified their holdings of the company. EverSource Wealth Advisors LLC grew its position in shares of J & J Snack Foods by 902.9% in the 2nd quarter. EverSource Wealth Advisors LLC now owns 351 shares of the company’s stock worth $40,000 after buying an additional 316 shares during the last quarter. MassMutual Private Wealth & Trust FSB lifted its position in J & J Snack Foods by 897.7% during the fourth quarter. MassMutual Private Wealth & Trust FSB now owns 439 shares of the company’s stock valued at $40,000 after acquiring an additional 395 shares during the last quarter. Assetmark Inc. boosted its stake in J & J Snack Foods by 19,000.0% in the third quarter. Assetmark Inc. now owns 955 shares of the company’s stock valued at $92,000 after acquiring an additional 950 shares in the last quarter. GAMMA Investing LLC boosted its stake in J & J Snack Foods by 38.0% in the third quarter. GAMMA Investing LLC now owns 966 shares of the company’s stock valued at $93,000 after acquiring an additional 266 shares in the last quarter. Finally, Covestor Ltd grew its holdings in J & J Snack Foods by 71.1% in the third quarter. Covestor Ltd now owns 1,013 shares of the company’s stock worth $97,000 after purchasing an additional 421 shares during the last quarter. 76.04% of the stock is currently owned by institutional investors.
Analyst Ratings Changes Several analysts have recently commented on the company. Benchmark reiterated a “buy” rating on shares of J & J Snack Foods in a report on Tuesday, January 20th. Weiss Ratings reaffirmed a “sell (d+)” rating on shares of J & J Snack Foods in a research report on Friday, March 27th. Finally, Zacks Research cut J & J Snack Foods from a “strong-buy” rating to a “hold” rating in a research note on Monday, January 19th. One equities research analyst has rated the stock with a Buy rating, one has given a Hold rating and one has issued a Sell rating to the company. Based on data from MarketBeat.com, J & J Snack Foods has a consensus rating of “Hold” and a consensus target price of $130.00.
Read Our Latest Analysis on J & J Snack Foods
J & J Snack Foods Stock Performance NASDAQ:JJSF opened at $79.22 on Monday. J & J Snack Foods Corp. has a twelve month low of $73.75 and a twelve month high of $142.69. The company has a market cap of $1.51 billion, a PE ratio of 25.23 and a beta of 0.38. The company’s 50 day moving average is $83.77 and its two-hundred day moving average is $89.13.
J & J Snack Foods (NASDAQ:JJSF – Get Free Report) last posted its quarterly earnings results on Tuesday, February 3rd. The company reported $0.33 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.32 by $0.01. J & J Snack Foods had a net margin of 3.92% and a return on equity of 8.79%. The business had revenue of $343.78 million during the quarter, compared to analysts’ expectations of $365.95 million. During the same quarter last year, the company posted $0.33 earnings per share. The business’s quarterly revenue was down 5.2% on a year-over-year basis. As a group, analysts expect that J & J Snack Foods Corp. will post 4.75 EPS for the current fiscal year.
J & J Snack Foods Dividend Announcement The company also recently announced a quarterly dividend, which will be paid on Tuesday, April 7th. Investors of record on Tuesday, March 17th will be paid a $0.80 dividend. The ex-dividend date is Tuesday, March 17th. This represents a $3.20 dividend on an annualized basis and a yield of 4.0%. J & J Snack Foods’s dividend payout ratio (DPR) is 101.91%.
J & J Snack Foods announced that its Board of Directors has approved a share buyback plan on Tuesday, February 3rd that permits the company to repurchase $50.00 million in outstanding shares. This repurchase authorization permits the company to buy up to 2.8% of its stock through open market purchases. Stock repurchase plans are typically an indication that the company’s leadership believes its shares are undervalued.
J & J Snack Foods Company Profile (Free Report)
J & J Snack Foods (NASDAQ: JJSF) is a U.S.-based manufacturer and distributor of branded snack foods and frozen beverages. Headquartered in Pennsauken, New Jersey, the company develops, produces and markets a broad array of proprietary and licensed products for retail, concession and foodservice customers. Its offerings span soft pretzels, frozen novelties, real Italian ice, churros and packaged beverages under well-known names such as ICEE, SuperPretzel, Luigi’s and ChurroMan.
Founded in 1971 by Gerald B.
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Volatility has a way of making investors forget what they're actually trying to do. The goal isn't to predict what the market does next month. It's about owning pieces of good businesses that pay you to wait, and ideally pay you more over time.
Consumer goods companies with good dividends have historically been the most reliable version of that idea. But within that category, there's a spectrum. Some are obvious, over-owned, and priced accordingly. Others are sitting at compelling valuations with above-average yields, and nobody is writing about them.
Here are three I'm looking at these days.
Image source: Getty Images.
1. Artisan Partners Asset Management Most people think of dividend stocks as utilities or consumer staples. But Artisan Partners Asset Management (APAM +2.75%) runs a high-quality global investment management business with a payout structure that's legitimately unusual and unusually generous.
The firm has $188.5 billion in assets under management as of February 2026, split roughly evenly between its branded Artisan Funds and separate accounts serving institutional and high-net-worth clients. Strategies span growth, value, credit, emerging markets, real estate, and custom credit, making it a diversified active manager outside of the mega-asset managers.
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What makes the dividend interesting is its structure. Artisan pays a base quarterly dividend plus a special annual dividend that varies based on earnings and distributable cash flow. Total dividends in 2024 came to $3.16 per share, and in February 2026, the company paid both a quarterly dividend and a special annual distribution.
At the current share price of just over $35, the trailing dividend yield is 11.4%. That yield isn't a red flag; it reflects a payout model built for a capital-light business that converts a high percentage of its revenue into distributable earnings.
Be wary -- the risk here is that the assets the company manages are market-sensitive, and a sustained equity bear market would compress fee revenue. But for an investor willing to accept some variability in the special dividend, Artisan offers a rare combination: an 11%-plus yield and a high-quality underlying business.
2. Natural Grocers by Vitamin Cottage Not every grocery chain is created equal. Natural Grocers by Vitamin Cottage (NGVC 0.32%) operates 168 stores in 21 states as of late 2025, selling only USDA-certified organic produce and exclusively pasture-raised, non-confinement dairy products. That product standard is a constraint, but it's also a moat. Natural Grocers doesn't compete on price against Walmart. It competes on trust.
In the first quarter of fiscal 2026, the company reported net income up 14% to $11.3 million on net sales of $335.6 million. Two-year comparable-store sales growth of 10.6% outpaced the broader grocery retail industry. The company ended the quarter with no outstanding borrowings and $23.2 million in cash.
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From a tariff perspective, Natural Grocers has an angle that most retailers don't. Its strict domestic-sourcing preferences and organic procurement practices limit import exposure. When tariffs hit conventional grocery supply chains, a retailer with deep domestic organic supplier relationships is insulated in ways that are hard to replicate quickly.
The dividend is modest at around a 2.1% yield, but the company has zero long-term debt and strong free-cash-flow coverage. The stock has pulled back from its 52-week high, and the current price looks like a reasonable entry point for a business that benefits from the long secular trend toward organic and natural food.
3. J&J Snack Foods J&J Snack Foods (JJSF 1.11%) sells SuperPretzels in shopping malls, ICEE drinks at movie theaters, and churros at stadiums. That distribution footprint ties it closely to where people gather -- and right now, the stock is trading near a 52-week low.
In fiscal Q1 2026, revenue declined 5.2% year over year to $343.8 million, and the company missed consensus estimates. That's the headline that pushed the stock down. But the gross margin actually improved by 200 basis points to 27.9%, and the company has no long-term debt and ended the quarter with $67 million in cash.
More relevant to long-term investors: J&J Snack Foods launched Project Apollo, a structural cost-reduction initiative that delivered $3 million in savings in its first quarter of operation. Management also authorized a new $50 million share repurchase program at the time of earnings.
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The quarterly dividend of $0.80 per share translates to an annualized dividend of $3.20 per share, yielding roughly 4.1%. That yield is the highest the stock has offered in several years. J&J Snack Foods has a history of consistent dividend payments and low debt.
I think the current weakness is cyclical, tied to soft foot traffic at entertainment and food-service venues. But stadiums still fill up, and people still want ICEE drinks at the movies. This dip looks like an opening for investors.
April 22, 2026 16:40 ET | Source: J & J Snack Foods Corp.
MOUNT LAUREL, N.J., April 22, 2026 (GLOBE NEWSWIRE) -- J & J Snack Foods Corp. (Nasdaq: JJSF) today announced that it will release financial results for its fiscal second quarter ended March 28, 2026, before the stock market opens on Wednesday, May 6, 2026. The Company will hold a conference call and webcast to discuss the results at 10:00 a.m. Eastern Time that same day.
Investors interested in participating in the live call can dial (844) 826-3033 from the U.S. or international callers can dial (412) 317-5185. There will also be a live webcast available on the Investor Relations section of the Company's web site at https://investors.jjsnack.com/news-events/events or directly at https://viavid.webcasts.com/starthere.jsp?ei=1758571&tp_key=8bba556fd6. The webcast will be archived for approximately 30 days.
About J & J Snack Foods Corp.
J & J Snack Foods Corp. is a leader and innovator in the snack food industry, providing innovative, niche, and affordable branded snack foods and beverages to foodservice and retail supermarket outlets. Manufactured and distributed nationwide, our principal products include SUPERPRETZEL, the #1 soft pretzel brand in the world, as well as internationally known ICEE and SLUSH PUPPIE frozen beverages, DIPPIN’ DOTS ice cream, LUIGI’S Real Italian Ice, MINUTE MAID* frozen ices, WHOLE FRUIT sorbet and frozen fruit bars, ¡HOLA! CHURROS, and THE FUNNEL CAKE FACTORY funnel cakes and several bakery brands within DADDY RAY’S, COUNTRY HOME BAKERS and HILL & VALLEY. For more information, please visit http://www.jjsnack.com.
*MINUTE MAID is a registered trademark of The Coca-Cola Company.
J & J Snack Foods (NASDAQ:JJSF – Get Free Report) and Top Wealth Group (NASDAQ:TWG – Get Free Report) are both small-cap consumer staples companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, profitability, valuation, dividends and risk.
Valuation and Earnings This table compares J & J Snack Foods and Top Wealth Group”s revenue, earnings per share (EPS) and valuation.
Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio J & J Snack Foods $1.58 billion 1.01 $65.60 million $3.14 26.80 Top Wealth Group $4.75 million 0.43 -$2.02 million N/A N/A J & J Snack Foods has higher revenue and earnings than Top Wealth Group.
Analyst Ratings This is a breakdown of recent recommendations and price targets for J & J Snack Foods and Top Wealth Group, as provided by MarketBeat.
Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score J & J Snack Foods 1 1 1 0 2.00 Top Wealth Group 1 0 0 0 1.00 J & J Snack Foods currently has a consensus target price of $130.00, indicating a potential upside of 54.47%. Given J & J Snack Foods’ stronger consensus rating and higher probable upside, equities research analysts plainly believe J & J Snack Foods is more favorable than Top Wealth Group.
Volatility & Risk J & J Snack Foods has a beta of 0.38, suggesting that its share price is 62% less volatile than the S&P 500. Comparatively, Top Wealth Group has a beta of 0.82, suggesting that its share price is 18% less volatile than the S&P 500.
Profitability This table compares J & J Snack Foods and Top Wealth Group’s net margins, return on equity and return on assets.
Net Margins Return on Equity Return on Assets J & J Snack Foods 3.92% 8.79% 6.09% Top Wealth Group N/A N/A N/A Insider and Institutional Ownership 76.0% of J & J Snack Foods shares are held by institutional investors. 20.4% of J & J Snack Foods shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Summary J & J Snack Foods beats Top Wealth Group on 11 of the 12 factors compared between the two stocks.
About J & J Snack Foods (Get Free Report)
J&J Snack Foods Corp. engages in the manufacturing of nutritional snack foods and distribution of frozen beverages to the food service and retail supermarket industries. It operates through the following segments: Food Service, Retail Supermarkets, and Frozen Beverages. The Food Service segment includes soft pretzels, frozen novelties, churros, handheld products, and baked goods. The Retail Supermarkets segment offers soft pretzel products including Superpretzel, frozen juice treats and desserts, including Luigi’s real Italian ice, Minute Maid juice bars and soft frozen lemonade, Whole Fruit frozen fruit bars and sorbet, Philly Swirl cups and sticks, ICEE Squeeze-Up Tubes and dough enrobed handheld products including Patio burritos. The Frozen Beverages segment provides frozen beverages to the food service industry primarily under the names ICEE, SLUSH PUPPIE, and PARROT ICE in the United States, Mexico, and Canada, as well as repair and maintenance services. The company was founded by Gerald B. Shreiber in 1971 and is headquartered in Mount Laurel, NJ.
About Top Wealth Group (Get Free Report)
Top Wealth Group Holding Limited, through its subsidiaries, provides caviar and caviar-based gourmet products in Hong Kong and internationally. The company also trades in caviars; and offers its products under the Imperial Cristal Caviar brand name. It serves food and beverage related distributors. The company was founded in 2009 and is based in Sai Wan, Hong Kong. Top Wealth Group Holding Limited operates as a subsidiary of Winwin Development Group Limited.
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Dividend stocks are not all the same, and while some trade at over 30 times forward earnings, others are trading at bargain-basement prices. Stocks like General Mills (NYSE:GIS | GIS Price Prediction), Flowers Foods (NYSE:FLO), and J&J Snack Foods (NASDAQ:JJSF) could be loaded springs that can deliver 100%-plus upside in the next 12-24 months.
Each of these stocks pays you a solid dividend yield and is a cash cow. The problem is, each of them has gotten hit by a slowdown or is grappling with high interest rates or low margins. It has scared away investors, but buying the dip right now can be the smarter move for the long run since these are well-established companies that are likely to recover eventually. Dividend-paying businesses see dips all the time, but if you can buy the dips and reinvest the dividends through them, the recovery will give you more than a growth stock ever could.
General Mills (GIS) General Mills sells packaged foods like snacks, cereal, and convenient meals, among others. This is the market that got hit by the GLP-1 scare, but investors are misjudging how big the impact is and where the real pain is coming from.
If we look at sales, it declined from a peak of $20.09 billion in FY2023 to $19.5 billion in FY2025. This isn’t a disastrous decline, and the growth slowdown isn’t without precedent either. General Mills saw revenue decline from $17.9 billion in FY2014 to $15.6 billion in FY2017. The stock fell from a 2016 peak of $64 to a low of around $44.
The decline we are seeing now is from a $90 peak to a current price of $34.8. The decline we saw in the 2010s had a similar impact on profits. So what’s different this time?
It’s interest rates.
General Mills posted $524.2 million in net interest losses in FY2025. In FY2023, net interest losses were $379.6 million. Moreover, apart from interest losses, consumers themselves felt the pinch, and snacks and cereals saw lost sales.
However, a rebound from here is only a matter of time as interest rates eventually come down and margins stabilize. GIS stock trades at just 8.5 times earnings, and you get a 7% dividend yield to bet on a recovery. If you count the buybacks, the shareholder yield rises to 8.6%.
Flowers Foods (FLO) FLO stock is on a similar trajectory to that of GIS. The company sells baked products and has been on a reliable growth trajectory for decades. FLO stock even matched the Nasdaq’s performance for many years while delivering a solid yield and more safety during downturns. The stock then fell off significantly since mid-2023 as interest rates were raised and GLP-1 fears took center stage.
I believe FLO stock is close to a recovery, as the stock is as cheap as it gets without being ridiculous. The dividend yield is at 11.1%, and management has not cut its dividend. FLO’s payout ratio still covers the dividends despite the margin decline, and analysts expect the margins to claw back over the coming years.
In the meantime, you are paying less than 0.4 times sales and nearly 10 times forward earnings for a business that has grown its dividends for 12 years consecutively while being a cash cow.
The stock trades at just 6 times free cash flow. The average consumer packaged goods business trades at 16 times FCF on the stock market. Historically, FLO stock has traded at over 18 times FCF. Hence, a 100%-plus recovery is likely once things eventually normalize here.
J&J Snack Foods (JJSF) J&J Snack Foods sells snacks and frozen beverages. Having “snacks” in the company’s name alone has been enough for investors to run away from a stock due to GLP-1 fears. Thankfully, these fears have been fading, and JJSF is showing signs that it is turning the corner.
The stock is down 52% from its highs, and I see a full recovery above $180 within the next two years. I expect the recovery to come even faster if interest rate cuts aren’t delayed significantly, as the dividend yield of 3.66% is on the verge of being competitive against Treasuries.
The stock still trades at a premium at 20 times forward earnings, but this is cheap historically since JJSF stock has traded at a premium valuation historically. The historical forward PE ratio has been around 35x.
Wall Street expects a year-over-year increase in earnings on higher revenues when Post Holdings (POST - Free Report) reports results for the quarter ended March 2026. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates.
The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on May 7. On the other hand, if they miss, the stock may move lower.
While management's discussion of business conditions on the earnings call will mostly determine the sustainability of the immediate price change and future earnings expectations, it's worth having a handicapping insight into the odds of a positive EPS surprise.
Zacks Consensus EstimateThis cereal maker is expected to post quarterly earnings of $1.64 per share in its upcoming report, which represents a year-over-year change of +16.3%.
Revenues are expected to be $2.06 billion, up 5.6% from the year-ago quarter.
Estimate Revisions TrendThe consensus EPS estimate for the quarter has been revised 5.35% lower over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period.
Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts.
Price, Consensus and EPS Surprise
Earnings WhisperEstimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction).
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.
Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only.
A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP.
Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell).
How Have the Numbers Shaped Up for Post Holdings?For Post Holdings, the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -4.27%.
On the other hand, the stock currently carries a Zacks Rank of #2.
So, this combination makes it difficult to conclusively predict that Post Holdings will beat the consensus EPS estimate.
Does Earnings Surprise History Hold Any Clue?While calculating estimates for a company's future earnings, analysts often consider to what extent it has been able to match past consensus estimates. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number.
For the last reported quarter, it was expected that Post Holdings would post earnings of $1.66 per share when it actually produced earnings of $2.13, delivering a surprise of +28.31%.
Over the last four quarters, the company has beaten consensus EPS estimates four times.
Bottom LineAn earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss.
That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
Post Holdings doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release.
Expected Results of an Industry PlayerAmong the stocks in the Zacks Food - Miscellaneous industry, J&J Snack Foods (JJSF - Free Report) , is soon expected to post earnings of $0.39 per share for the quarter ended March 2026. This estimate indicates a year-over-year change of +11.4%. This quarter's revenue is expected to be $345 million, down 3.1% from the year-ago quarter.
Over the last 30 days, the consensus EPS estimate for J&J Snack Foods has remained unchanged. Nevertheless, the company now has an Earnings ESP of 0.00%, reflecting an equal Most Accurate Estimate.
This Earnings ESP, combined with its Zacks Rank #3 (Hold), makes it difficult to conclusively predict that J&J Snack Foods will beat the consensus EPS estimate. Over the last four quarters, the company surpassed consensus EPS estimates three times.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
MOUNT LAUREL, N.J., May 06, 2026 (GLOBE NEWSWIRE) -- J & J Snack Foods Corp. (Nasdaq: JJSF) today reported financial results for the first quarter ended March 28, 2026.
Second QuarterActuals$ v. LY% v. LYNet Sales$344.8M$(11.3)M(3.2)%Gross Profit$99.3M$3.6M3.8%Operating Income$1.8M($4.2M)(70.1%)Net Earnings$1.7M($3.1M)(65.2%)Earnings per Diluted Share$0.09($0.16)(64.0%) Adjusted Operating Income$9.6M$0.8M8.7%Adjusted EBITDA$28.7M$2.5M9.5%Adjusted Earnings per Diluted Share$0.40$0.0514.3% This press release contains non-GAAP financial measures. Please refer to the Non-GAAP Financial Measures section below for reconciliations to the most comparable GAAP measures.
"Our second quarter results demonstrate meaningful progress in our strategic transformation, with strong profitability improvements that position us well for the future," said Dan Fachner, Chairman, President, and CEO of J&J Snack Foods. "Our transformation initiatives and mix improvements enabled us to drive solid bottom line growth including a 9.5% increase in Adjusted EBITDA and a 14.3% increase in Adjusted earnings per share. These results clearly show that Project Apollo is delivering tangible benefits and improving our underlying business performance.
"The innovative product launches we discussed last quarter are now reaching customers with positive early reception, and our pipeline remains robust. During the quarter, we repurchased $22 million of stock and we continue to see compelling value in our shares as we execute our transformation strategy."
Second Quarter Results
Net sales decreased 3.2% from the prior year quarter to $344.8 million, with most of the decline attributable to anticipated reductions to our bakery business.
Food Service segment net sales decreased 5.0%Retail Supermarket segment net sales decreased 4.1%Frozen Beverage segment net sales increased 3.1%
Gross profit increased from $95.7 million in the prior year quarter to $99.3 million, while gross margin improved from 26.9% to 28.8%. The improvement in gross margin primarily reflects our Apollo transformation initiatives and mix improvements versus the prior year.
Total operating expenses of $97.5 million included $6.5 million in non-recurring plant closure costs, as well as other non-recurring expenses. Of the non-recurring costs, $4.1 million was non-cash.
Selling and Marketing expenses increased 5.5% to $30.1 million or 8.7% of sales, up from 8.0% in the prior year quarter. The increase included investments in brand support and sponsorships.Distribution expenses decreased 0.2% to $41.7 million or 12.1% of sales up from 11.7% in the prior year quarter. Distribution expenses included higher fuel costs of approximately $0.4 million.Administrative expenses increased 7.2% to $21.2 million or 6.1% of sales, up from 5.5% in the prior year quarter. The increase was primarily due to a $0.9 million increase in non-recurring legal expenses and other restructuring charges including severance.
Operating income was $1.8 million, compared to $6.0 million in the prior year quarter, while adjusted operating income was $9.6 million, compared to $8.9 million in the prior year quarter. Earnings per diluted share were $0.09, compared to $0.25 in the prior year quarter, while adjusted earnings per diluted share were $0.40, compared to $0.35 in the prior year quarter. The effective tax rate was 28.1%, compared to 27.2% in the prior year quarter.
Food Service Segment
Net sales of $214.7 million, a year-over-year decrease of $11.4 million or 5.0%. Anticipated reductions in our lower margin bakery business represented approximately $8.0 million of the decline.Pretzels sales increased $6.7 million, partly offsetting lower sales of handhelds, cookies, and churros.Operating income increased $3.4 million to $10.9 million. Retail Supermarket Segment
Net sales of $51.6 million, a year-over-year decrease of $2.2 million or 4.1%.Frozen novelty sales declined $3.9 million, driven primarily by increased slotting fees associated with our new product innovation and higher trade investment compared to the prior year.Retail handheld sales increased as we lapped capacity constraints in the prior year.Operating income decreased $3.9 million to a ($0.4) million loss. Frozen Beverages Segment
Net sales of $78.5 million, a year-over-year increase of $2.3 million or 3.1%.Beverage sales were up $5.2 million while service sales declined $3.2 million.Operating income increased $2.1 million to $4.6 million.
Share Repurchases
During the quarter, we repurchased 259,889 shares of common stock for $22 million. As of March 28, 2026, there was $28 million remaining under the $50 million share repurchase program approved by the Board of Directors.
Conference Call
J&J Snack Foods Corp. will host a conference call to discuss results and business outlook today, May 6, 2026, at 10:00 a.m. Eastern Time. Investors interested in participating in the live call can dial (844) 826-3033 from the U.S. or international callers can dial (412) 317-5185. There will also be a live webcast available on the Investor Relations section of the Company's web site at investors.jjsnack.com/news-events/events or directly here. The webcast will be archived for approximately 30 days.
About J & J Snack Foods Corp.
J & J Snack Foods Corp. (Nasdaq: JJSF) is a leader and innovator in the snack food and frozen beverage industry. For over fifty years, the company has specialized in delicious snack and beverage brands for the foodservice and retail segments, serving up fun across the U.S. market. J & J Snack Foods’ core brands include SUPERPRETZEL, the #1 soft pretzel brand, ICEE and SLUSH PUPPIE frozen beverages, and Dippin’ Dots, the original beaded ice cream. The company’s broad brand portfolio also includes LUIGI’S Real Italian Ice, MINUTE MAID* frozen ices, WHOLE FRUIT frozen fruit bars, DOGSTERS ice cream style treats for dogs, ¡Hola! Churros, THE FUNNEL CAKE FACTORY funnel cakes and fries, and bakery brands including MARY B’S, DADDY RAY’S, COUNTRY HOME BAKERS, and HILL & VALLEY. For more information, please visit http://www.jjsnack.com. *MINUTE MAID is a registered trademark of The Coca-Cola Company.
Cautionary Statement Regarding Forward-Looking Information
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements regarding the Company’s expected future financial position, results of operations, revenue growth and profit levels, cash flows, business strategy, budgets, projected costs, capital expenditures, products, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include words such as “anticipate,” “if,” “believe,” “plan,” “goals,” “estimate,” “expect,” “intend,” “may,” “could,” “should,” “will,” and other similar expressions are forward-looking statements. This includes, without limitation, our statements, and expectations regarding any current or future recovery in our industry and the future impact of our operational efficiency projects. Such forward-looking statements are inherently uncertain, and readers must recognize that actual results may differ materially from the expectations of management. We do not undertake a duty to update such forward-looking statements. Factors that may cause actual results to differ materially from those in the forward-looking statements include consumer spending, price competition, acceptance of new products, the pricing and availability of raw materials, transportation costs, changes in the competitive marketplace the uncertainty and ultimate economic impact of the COVID-19 pandemic or similar health outbreaks, and other risks identified in our annual report on Form 10-K, and our other filings with the Securities and Exchange Commission. Many of these factors are outside of the Company’s control.
Non-GAAP Financial Measures
Adjusted EBITDA consists of net earnings adjusted to exclude: income taxes (benefit); investment income; interest expense; depreciation and amortization; share-based compensation expense; net (gain) loss on sale or disposal of assets; impairment charges, restructuring costs, merger and acquisition costs, acquisition related inventory adjustments, strategic business transformation costs, integration costs, non-recurring legal fee settlements, gain on insurance proceeds received for damage to property, plant and equipment, and plant closure expenses. Adjusted Operating Income consists of operating income adjusted to exclude: impairment charges, restructuring costs, merger and acquisition costs, acquisition related amortization expenses and inventory adjustments, strategic business transformation costs, integration costs, non-recurring legal fee settlements, gain on insurance proceeds received for damage to property, plant and equipment, and plant closure expenses. Adjusted Earnings per Diluted Share consists of net earnings adjusted to exclude: impairment charges, restructuring costs, merger and acquisition costs, acquisition related amortization expenses and inventory adjustment, strategic business transformation costs, integration costs, non-recurring legal fee settlements, gain on insurance proceeds received for damage to property, plant and equipment, and plant closure expenses. For purposes of comparability, the income tax effect of pre-tax adjustments is determined using statutory tax rates. This press release contains certain non-GAAP financial measures; Adjusted EBITDA, Adjusted Operating Income, and Adjusted Earnings per Diluted Share. A "non-GAAP financial measure" is a numerical measure of a company's financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with U.S. generally accepted accounting principles ("GAAP") in the statements of income, balance sheets, or statements of cash flow of the company. Pursuant to applicable reporting requirements, the company has provided reconciliations below of non-GAAP financial measures to the most directly comparable GAAP measure. The non-GAAP financial measures presented within the Company's earnings release are not indicators of our financial performance under GAAP and should not be considered as an alternative to the applicable GAAP measure. These non-GAAP measures have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our results as reported under GAAP. In addition, in evaluating these non-GAAP measures, you should be aware that in the future we may incur income, expenses, gains and losses, similar to the adjustments in this press release. Our presentation of these non-GAAP measures should not be construed as an inference that our future results will be unaffected by unusual or infrequent items. We compensate for these limitations by providing equal prominence to our GAAP results and using non-GAAP measures only as supplemental presentations. The non-GAAP measures presented are utilized by management to evaluate the Company's business performance and profitability by excluding certain items that may not be indicative of our recurring core business operating results. The Company believes that these measures provide additional clarity for investors by excluding specific income, expenses, gains, and losses, in an effort to show comparable business operating results for the periods presented. Similarly, Management believes these adjusted measures are useful performance measures because certain items included in the calculations may either mask or exaggerate trends in the Company’s ongoing operating performance. See the reconciliation of Non-GAAP Financial Measures below.
J & J SNACK FOODS CORP. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF EARNINGS(Unaudited)(in thousands, except per share amounts) Three months ended Six months ended March 28, March 29, March 28, March 29, 2026 2025 2026 2025 Net sales$344,819 $356,099 $688,597 $718,697 Cost of goods sold 245,527 260,396 493,293 529,093 Gross profit 99,292 95,703 195,304 189,604 Operating expenses Marketing 30,083 28,507 61,582 57,176 Distribution 41,737 41,833 79,793 81,443 Administrative 21,184 19,754 41,561 38,657 Gain on insurance proceeds received for damage to property, plant and equipment - - (800) - Plant closure expenses 4,756 - 10,869 - Other general expense (271) (414) (141) 66 Total operating expenses 97,489 89,680 192,864 177,342 Operating income 1,803 6,023 2,440 12,262 Other income (expense) Investment income 832 689 1,544 1,726 Interest expense (302) (85) (441) (297) Earnings before income taxes 2,333 6,627 3,543 13,691 Income tax expense 656 1,803 983 3,724 NET EARNINGS$1,677 $4,824 $2,560 $9,967 Earnings per diluted share$0.09 $0.25 $0.13 $0.51 Weighted average number of diluted shares 18,930 19,563 19,136 19,568 Earnings per basic share$0.09 $0.25 $0.13 $0.51 Weighted average number of basic shares 18,910 19,488 19,113 19,480 J & J SNACK FOODS CORP. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS(Unaudited)(in thousands, except share amounts) March 28, September 27, 2026 2025 Assets Current assets Cash and cash equivalents$59,746 $105,893 Accounts receivable, net 178,011 184,069 Inventories 171,561 175,173 Prepaid expenses and other 24,169 13,197 Total current assets 433,487 478,332 Property, plant and equipment, at cost 1,030,562 1,009,463 Less accumulated depreciation and amortization 646,912 619,310 Property, plant and equipment, net 383,650 390,153 Other assets Goodwill 185,070 185,070 Trade name intangible assets, net 105,920 105,920 Other intangible assets, net 63,930 66,730 Operating lease right-of-use assets 149,591 151,538 Other 3,488 3,758 Total other assets 507,999 513,016 Total Assets$1,325,136 $1,381,501 Liabilities and Stockholders' Equity Current Liabilities Current portion of long-term debt$29,000 $- Current finance lease liabilities 615 563 Accounts payable 89,631 82,405 Accrued insurance liability 15,718 16,441 Accrued liabilities 12,326 12,606 Current operating lease liabilities 23,064 21,624 Accrued compensation expense 22,143 26,475 Dividends payable 15,003 15,552 Total current liabilities 207,500 175,666 Long-term debt - - Noncurrent finance lease liabilities 1,117 1,355 Noncurrent operating lease liabilities 138,737 140,021 Deferred income taxes 91,180 91,703 Other long-term liabilities 6,526 6,061 Stockholders' Equity Preferred stock, $1 par value; authorized 10,000,000 shares; none issued - - Common stock, no par value; authorized, 50,000,000 shares; issued and outstanding 18,753,000 and 19,440,000 respectively 78,110 139,118 Accumulated other comprehensive loss (10,607) (12,647)Retained Earnings 812,573 840,224 Total stockholders' equity 880,076 966,695 Total Liabilities and Stockholders' Equity$1,325,136 $1,381,501 J & J SNACK FOODS CORP. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)(in thousands) Six months ended March 28, March 29, 2026 2025 Operating activities: Net earnings$2,560 $9,967 Adjustments to reconcile net earnings to net cash provided by operating activities Depreciation of fixed assets 34,799 31,585 Amortization of intangibles and deferred costs 2,800 3,925 Losses (Gains) from disposals of property & equipment 168 (77) Non-cash plant shutdown expenses 5,046 - Non-cash impairment charge 850 - Share-based compensation 3,131 2,753 Deferred income taxes (480) 56 Gain on insurance proceeds received for damage to property, plant, and equipment (800) - Other 270 209 Changes in assets and liabilities, net of effects from purchase of companies Decrease in accounts receivable 6,378 15,794 Decrease (Increase) in inventories 2,057 (13,167) Net changes in other operating assets and liabilities (5,137) (3,573) Net cash provided by operating activities 51,642 47,472 Investing activities: Purchases of property, plant and equipment (35,184) (38,530) Proceeds from disposal of property and equipment 421 622 Proceeds from insurance for fixed assets 800 - Net cash (used in) investing activities (33,963) (37,908) Financing activities: Payments to repurchase common stock (63,981) (5,000) Proceeds from issuance of stock 1,160 2,886 Purchase of vested employee service share units and performance share units (728) - Borrowings under credit facility 75,000 15,000 Repayment of borrowings under credit facility (46,000) (15,000) Payments on finance lease obligations (249) (121) Payment of cash dividend (30,760) (30,371) Net cash (used in) financing activities (65,558) (32,606) Effect of exchange rates on cash and cash equivalents 1,732 (1,838) Net (decrease) in cash and cash equivalents (46,147) (24,880)Cash and cash equivalents at beginning of period 105,893 73,394 Cash and cash equivalents at end of period$59,746 $48,514 J & J SNACK FOODS CORP. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudited) (in thousands) Three months ended Six months ended March 28, March 29, March 28, March 29, 2026 2025 2026 2025 Sales to external customers: Food Service$214,665 $226,053 $433,821 $464,936 Retail Supermarket 51,620 53,848 97,502 98,565 Frozen Beverages 78,534 76,198 157,274 155,196 Consolidated sales to external customers$344,819 $356,099 $688,597 $718,697 Operating Income: Food Service$10,855 $7,465 $20,954 $16,279 Retail Supermarket (385) 3,512 775 4,703 Frozen Beverages 4,636 2,522 8,685 7,213 Total Segment Operating Income 15,106 13,499 30,414 28,195 General corporate expenses 8,547 7,476 17,905 15,933 Gain on insurance proceeds received for damage to property, plant and equipment - - (800) - Plant closure expense 4,756 - 10,869 - Total Unallocated Operating Expenses (net) 13,303 7,476 27,974 15,933 Total Operating Income$1,803 $6,023 $2,440 $12,262 J & J SNACK FOODS CORP. AND SUBSIDIARIES NON-GAAP FINANCIAL MEASURES (Unaudited) (in thousands) Three months ended Six months ended March 28, March 29, March 28, March 29, 2026 2025 2026 2025 Reconciliation of GAAP Net Earnings to Adjusted EBITDA Net Earnings $1,677 $4,824 $2,560 $9,967 Income Taxes 656 1,803 983 3,724 Investment Income (832) (689) (1,544) (1,726) Interest Expense 302 85 441 297 Depreciation and Amortization 18,915 17,766 37,599 35,510 Share-Based Compensation 1,652 1,627 3,131 2,752 Gain on insurance proceeds received for damage to property, plant and equipment - - (800) - Restructuring Costs 1,244 260 1,501 260 Non-recurring Legal Expenses 483 591 802 591 Net (Gain) Loss on Sale or Disposal of Assets (175) (69) 168 77 Plant closure expenses 4,756 - 10,869 - Adjusted EBITDA $28,678 $26,198 $55,710 $51,452 Reconciliation of GAAP Operating Income to Adjusted Operating Income Operating Income $1,803 $6,023 $2,440 $12,262 Gain on insurance proceeds received for damage to property, plant and equipment - - (800) - Restructuring Costs 1,244 260 1,501 260 Non-recurring Legal Expenses 483 591 802 591 Acquisition Related Amortization Expenses 1,357 1,995 2,800 3,925 Plant closure expenses 4,756 - 10,869 - Adjusted Operating Income $9,643 $8,869 $17,612 $17,038 Reconciliation of GAAP Earnings per Diluted Share to Adjusted Earnings per Diluted Share Earnings per Diluted Share $0.09 $0.25 $0.13 $0.51 Gain on insurance proceeds received for damage to property, plant and equipment - - (0.04) - Restructuring Costs 0.07 0.01 0.08 0.01 Non-recurring Legal Expenses 0.03 0.03 0.04 0.03 Acquisition Related Amortization Expenses 0.07 0.10 0.15 0.20 Plant closure expenses 0.25 - 0.57 - Tax Effect of Non-GAAP Adjustments (1) (0.11) (0.04) (0.22) (0.07) Adjusted Earnings per Diluted Share $0.40 $0.35 $0.71 $0.68 (1) Income taxes associated with pre-tax adjustments determined using statutory tax rates
J&J Snack Foods (JJSF - Free Report) came out with quarterly earnings of $0.4 per share, beating the Zacks Consensus Estimate of $0.39 per share. This compares to earnings of $0.35 per share a year ago. These figures are adjusted for non-recurring items.
This quarterly report represents an earnings surprise of +2.56%. A quarter ago, it was expected that this drink and snack maker would post earnings of $0.32 per share when it actually produced earnings of $0.33, delivering a surprise of +3.13%.
Over the last four quarters, the company has surpassed consensus EPS estimates four times.
J&J Snack Foods, which belongs to the Zacks Food - Miscellaneous industry, posted revenues of $344.82 million for the quarter ended March 2026, missing the Zacks Consensus Estimate by 0.05%. This compares to year-ago revenues of $356.1 million. The company has topped consensus revenue estimates two times over the last four quarters.
The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.
J&J Snack Foods shares have lost about 6.4% since the beginning of the year versus the S&P 500's gain of 6%.
What's Next for J&J Snack Foods?While J&J Snack Foods has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?
There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Ahead of this earnings release, the estimate revisions trend for J&J Snack Foods was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $2.10 on $450 million in revenues for the coming quarter and $4.35 on $1.56 billion in revenues for the current fiscal year.
Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Food - Miscellaneous is currently in the bottom 19% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
One other stock from the same industry, Celsius Holdings Inc. (CELH - Free Report) , is yet to report results for the quarter ended March 2026. The results are expected to be released on May 7.
This company is expected to post quarterly earnings of $0.29 per share in its upcoming report, which represents a year-over-year change of +61.1%. The consensus EPS estimate for the quarter has been revised 2.2% lower over the last 30 days to the current level.
Celsius Holdings Inc.'s revenues are expected to be $755.22 million, up 129.4% from the year-ago quarter.
May 28, 2026 16:30 ET | Source: J & J Snack Foods Corp.
MOUNT LAUREL, N.J., May 28, 2026 (GLOBE NEWSWIRE) -- J & J Snack Foods Corp. (Nasdaq: JJSF) announced today that its Board of Directors has declared a quarterly cash dividend of $0.80 per share of its common stock payable on July 7, 2026, to shareholders of record as of the close of business on June 16, 2026.
The declaration and payment of dividends is subject to the discretion of the Board of Directors and depends on various factors, including the Company’s net income, financial position, cash requirements, restrictions in our credit facility and other factors deemed relevant by our Board of Directors.
About J & J Snack Foods Corp.
J & J Snack Foods Corp. is a leader and innovator in the snack food industry, providing innovative, niche, and affordable branded snack foods and beverages to foodservice and retail supermarket outlets. Manufactured and distributed nationwide, our principal products include SUPERPRETZEL, the #1 soft pretzel brand in the world, as well as internationally known ICEE and SLUSH PUPPIE frozen beverages, DIPPIN’ DOTS ice cream, LUIGI’S Real Italian Ice, MINUTE MAID* frozen ices, WHOLE FRUIT sorbet and frozen fruit bars, HOLA! CHURROS, and THE FUNNEL CAKE FACTORY funnel cakes and several bakery brands within DADDY RAY’S, COUNTRY HOME BAKERS and HILL & VALLEY. For more information, please visit http://www.jjsnack.com.
*MINUTE MAID is a registered trademark of The Coca-Cola Company.
Certain statements in this press release may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created thereby. Please refer to our public filings for a discussion of certain important factors that relate to forward-looking statements contained in this press release. The words "believe," "expect," "anticipate," "estimate," "guidance," "target," "intend" and similar expressions identify forward-looking statements. Although we believe that the expectations reflected in these forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct.
Blue Origin's New Glenn rocket sits at Launch Complex 36 ahead of its launch from Cape Canaveral Space Force Station on Nov. 8, 2025, in Cape Canaveral, Florida. (Miguel J. Rodriguez Carrillo/Getty Images)
Amazon.com and Blue Origin founder Jeff Bezos is optimistic about a return to flight in 2026 for Blue Origin after a surprise explosion damaged launch infrastructure in late May.
First Trust Indxx Aerospace & Defense ETF (MISL +5.02%) offers a lower-cost entry into established defense industrials, while Tema Space Innovators ETF (NASA +12.87%) provides a larger asset base and a narrower focus on space innovation.
Investors looking for exposure to the sky and beyond may find these two funds provide significantly different paths. While the First Trust fund follows a traditional index of defense firms, the Tema fund employs an active mandate to capture the space economy, including satellite communications, launch systems, and space-based data infrastructure across various geographies.
Snapshot (cost & size)MetricMISLNASAIssuerFirst TrustTemaExpense ratio0.6%0.75%Dividend yield0.3%N/AAUM$804.5 million$2.5 billionThe 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
NYSEMKT: MISLFirst Trust Exchange-Traded Fund - First Trust Indxx Aerospace & Defense ETF
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What's insideThe Tema Space Innovators ETF (NASA +12.87%) focuses on companies engaged in the expanding space economy, with largest positions including Rocket Lab (RKLB +9.42%) at 9.79%, MDA Space (MDA +8.19%) at 6.54%, and AST SpaceMobile (ASTS +11.83%) at 6.49%. It has the flexibility to invest across various market capitalizations and geographies to find innovation.
By comparison, the First Trust Indxx Aerospace & Defense ETF (MISL +5.02%) provides a portfolio of 49 holdings, primarily in industrials (83%) and technology (17%). Its top holdings include Palantir Technologies (PLTR +0.76%) at 9.24%, GE Aerospace (GE +4.36%) at 8.01%, and The Boeing Company (BA +6.04%) at 7.78%. Launched in 2022, the First Trust fund paid $0.16 per share over the trailing 12 months.
For more guidance on ETF investing, check out the full guide at this link.
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What this means for investors Space investing has gone from science fiction to serious financial theme almost overnight. The global space economy is forecast to nearly triple by 2035, driven by falling launch costs, broadband satellite expansion, and the early stages of commercial space exploration. That backdrop has sent investors rushing into space-related funds like NASA and MISL.
NASA just debuted on March 30, 2026 and crossed $2.6 billion in assets within two months. It is the first pure-play space ETF to include direct SpaceX access through a special purpose vehicle, an unprecedented feature that has proven enormously appealing. But space-focused funds can face extreme volatility, and NASA's explosive growth is driven as much by IPO excitement as by investment fundamentals.
By contrast, MISL is a passive, lower-cost fund anchored in established U.S. aerospace and defense companies that have real revenues and long track records. For long-term investors who want aerospace exposure without betting on the outcome of a single IPO, MISL is the more sensible choice. Its holdings generate real revenue today, carry government contracts that provide predictable cash flows, and have survived multiple market cycles. NASA is the fund for investors specifically seeking pre-IPO SpaceX exposure who also understand they are buying into one of the most momentum-driven trades in recent ETF history.
Sara Appino has positions in Palantir Technologies. The Motley Fool has positions in and recommends AST SpaceMobile, Boeing, GE Aerospace, MDA Space, Palantir Technologies, and Rocket Lab. The Motley Fool has a disclosure policy.
SpaceX, the aerospace and AI company founded by Elon Musk, will go public on June 12. It could raise $75 billion at a valuation of $2 trillion, making it the biggest IPO in history.
Many investors are selling other stocks to free up cash to buy SpaceX's shares. However, one stock that resisted that sell-off was AST SpaceMobile (ASTS +11.83%), which operates in the same satellite internet services market as SpaceX's Starlink.
Instead, AST's stock rallied more than 30% this year as SpaceX's looming IPO lifted most space stocks. Should investors take profits in AST today to buy more shares of SpaceX?
Image source: Getty Images.
The differences between AST SpaceMobile and SpaceX AST and SpaceX's Starlink both operate Low Earth Orbit (LEO) satellites that provide internet connectivity to areas where terrestrial cellular towers can't reach. However, the two companies operate different business models.
AST helps telecom giants like AT&T and Verizon directly connect their mobile devices to its satellites, but it doesn't provide its own internet service. Starlink offers its own satellite internet service, which requires a dedicated dish, but it also helps telecom companies like T-Mobile add satellite services to their smartphones.
AST processes its cellular data on the ground through its Radio Access Network (RAN) software, while its satellites function as repeaters. Starlink processes most of its cellular data directly in its satellites. Therefore, AST can upgrade its networks to new cellular technologies (such as 6G) from the ground, whereas Starlink needs to replace its physical satellites.
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AST has only launched seven satellites so far, while Starlink has launched over 12,000 satellites (more than 10,000 of which are still active). However, AST's satellites are much larger (with 693 to 2,400 sq ft arrays) than Starlink's satellites (with 65 to 125 sq ft arrays).
AST plans to have 45 to 60 satellites in orbit by the end of 2026, and up to 248 satellites over the next few years. Starlink plans to expand its constellation to 42,000 satellites. There could be plenty of room for both companies to grow, since they mainly serve different markets.
How fast are AST and SpaceX growing? SpaceX has several advantages over AST. It's much bigger, and it controls Starlink's entire production pipeline through its space division's orbital rockets and its AI division's software. Starlink is also profitable on its own, while AST remains unprofitable.
In 2025, SpaceX's revenue rose 33% to $18.7 billion, and it generated a net profit of $791 million, with Starlink's profits offsetting its space division's losses. But after it integrated xAI (which also owns X) into its business to launch its new AI division this May, it recast those results -- and it ended up with a staggering net loss of $4.9 billion in 2025. That cash-burning AI segment will remain a dead weight on its bottom line as it expands its infrastructure.
With a $2 trillion market debut, SpaceX would trade 107 times its 2025 sales. AST SpaceMobile looks even pricier at 288 times last year's sales -- but that's because it only launched its first commercial satellites in late 2024.
That's why AST's revenue surged 1,505% to $71 million in 2025. Its net loss widened from $300 million to $342 million, but it isn't burdened by money-losing rocket and AI divisions. Instead, it relies on SpaceX's Falcon rockets to carry its BlueBird (BB) satellites into orbit.
But is AST SpaceMobile a better investment than SpaceX? If SpaceX grows its top line at a 30% CAGR from 2025 to 2028, its revenue would reach $41.1 billion by the final year. At $2 trillion, it would trade at 49 times that estimate.
As for AST, analysts expect its revenue to grow at a 198% CAGR from 2025 to 2028, reaching $1.9 billion by the final year. At its current market cap of $28 billion, it trades at 15 times that estimate, making it seem more reasonably valued than SpaceX.
Analysts also expect AST to turn profitable in 2027 and 2028 as economies of scale kick in. SpaceX will likely struggle to break even as its AI and space losses erase Starlink's profits.
Based on these facts, I don't think investors should sell their AST shares to buy SpaceX. SpaceX will inevitably pull back after its red-hot market debut, so there's no reason to chase it when AST still looks reasonably valued relative to its long-term growth potential.
MIDLAND, Texas--(BUSINESS WIRE)---- $ASTS #AST--AST SpaceMobile, Inc. (“AST SpaceMobile”) (NASDAQ: ASTS), the company building the first and only space-based cellular broadband network accessible directly by everyday smartphones, designed for both commercial and government applications, today announced that the launch of the BlueBird 8, 9, and 10 satellites is currently scheduled for Wednesday, June 17, 2026, from Cape Canaveral, Florida, aboard a Falcon 9 rocket. Liftoff is targeted for 2:39 a.m. EDT with ad.
AST SpaceMobile ASTS rose 4.82% intraday after the company announced a June 17 launch for its BlueBird 8, 9, and 10 satellites aboard a SpaceX Falcon 9 from Cape Canaveral. The three next-generation satellites feature arrays measuring approximately 2,400 square feet, among the largest commercial communications arrays ever deployed in low Earth orbit, and are designed to deliver nearly double the peak data speeds of the company's initial Block 1 BlueBirds, which achieved 98.9 Mbps peak download directly to standard smartphones.
The launch advances AST SpaceMobile's push toward continuous global space-based cellular broadband coverage, with the satellites designed to connect directly to unmodified smartphones without additional hardware. The company builds approximately 95% of its technology in-house across a 2,250-person workforce. AST SpaceMobile has agreements with nearly 60 mobile network operators covering more than 3 billion combined subscribers, with strategic partners including AT&T T , Verizon VZ , Vodafone, and Google GOOG .
BlueBirds 8, 9, and 10 use a stackable satellite architecture designed for efficient multi-satellite launches and faster constellation deployment.
HomeIndustriesTelecommunicationsSpace WatchSpace WatchThe company is developing a space-based broadband cellular network that could rival Elon Musk’s StarlinkLast Updated: June 9, 2026 at 5:55 p.m. ET
First Published: June 9, 2026 at 3:38 p.m. ET
Satellite maker AST SpaceMobile has set a date for its next launch, as getting more satellites into space is the company’s latest step toward developing a cellular broadband service to rival Starlink, a division of Elon Musk’s SpaceX.
AST SpaceMobile ASTS said Tuesday that its BlueBird 8, 9 and 10 satellites are scheduled to be launched into low-Earth orbit as soon as June 17 from Cape Canaveral, Fla, aboard a SpaceX SPCX Falcon 9 rocket. The company had said the launch would take place sometime in mid-June, but has now revealed the specific date.
While the market’s latest selloff, which was rooted in the runaway AI chip trade, has adversely impacted high-flying tech stocks, high-beta companies in other industries have also had to deal with the fallout.
Among them is AST SpaceMobile NASDAQ: ASTS, the aerospace and space-based cellular broadband network provider. On Friday, June 5, ASTS fell over 12%, good for one of the stock’s worst single-day losses of the year.
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While there are plenty of reasons to remain bullish on the Midland, Texas-based company's long-term prospects, in the near term, there is some cause for concern, including accelerated institutional and insider selling.
Volatility Has Become a Trademark of AST SpaceMobilePrior to the June 5 selloff, shares of ASTS had hit their all-time high (ATH) on May 28 amid optimism surrounding the next BlueBird satellite launches, SpaceX IPO euphoria, and a strategic partnership between AT&T NYSE: T, T-Mobile NASDAQ: TMUS, and Verizon NYSE: VZ that should benefit the direct-to-device, or D2D, service provider.
However, that run-up—which included a gain of more than 108% from ASTS’s year-to-date (YTD) low on May 5—was preceded by several bouts of volatility:
Following the company’s enormous Q1 earnings miss, ASTS dropped by 12%.
A loss of 15% came after Blue Origin’s New Glenn rocket failed to deposit BlueBird 7 into the correct low-Earth orbit altitude.
Both contributed to a peak-to-trough loss of nearly 48% from the stock’s then-YTD high in late January to its YTD low.
Current Price$97.56High Forecast$108.00Average Forecast$81.33Low Forecast$45.60AST SpaceMobile Stock Forecast Details
Now, after a four-week winning streak that resulted in AST SpaceMobile’s ATH on May 28, the stock’s price has plummeted over 30%.
Multiple factors have contributed to the current slide, including analyst downgrades in the wake of the unrelated Blue Origin New Glenn rocket explosion, a consensus Reduce rating, and a 12-month price target that implies about 8% additional downside from current prices.
At the start of June, the stock took a hit when Deutsche Bank downgraded ASTS from a Buy to a Hold, while lowering its price target from $117 to $106.
Meanwhile, New Street Research, which assumed coverage of ASTS in mid-May, set a Neutral rating and a bearish $80 price target.
Behind the Scenes, Big Selling Is Taking PlaceWall Street’s tempered outlooks may not be as concerning as the trend in institutional and insider selling, which has ramped up of late.
While AST SpaceMobile has maintained its full-year revenue guidance, which highlights its operational stability and steady management outlook, 216 institutional sellers dumped $19 million worth of ASTS in the first quarter.
While that figure is far below the fourth-quarter level in its fiscal year 2025 (FY2025), selling has picked up momentum in the second quarter of this year. Most notably:
Parallel Advisors reduced its position by 20.5%.
Centaurus Financial reduced its position by 17.6%.
The Manufacturers Life Insurance Company reduced its position by 65.9%.
Buying has still surpassed selling, with inflows of $2.34 billion over the past 12 months versus outflows of nearly $496 million. But the size of institutional liquidations in Q2 is something shareholders may want to monitor going forward.
Insider selling hasn’t quelled any concerns, either. In Q2, that figure has reached a quarterly record of $272 million—easily surpassing the then-record $164 million in insider selling in Q4 FY2025. There are a few weeks remaining in the quarter, and the company hasn’t seen any insider buying since Q4 of last year.
Can SpaceX’s IPO Act as AST SpaceMobile’s Next CatalystOn Friday, June 12, SpaceX is expected to hold its long-awaited and highly anticipated IPO. Despite being one of the leading D2D competitors to the Elon Musk-helmed company, AST SpaceMobile could see a boost if the Starlink provider proves to be a rising tide that lifts all boats.
SpaceX’s pending valuation is rumored to be around $1.75 trillion, and with an unprecedented 30% of its IPO shares being reserved for retail investors, bullish sentiment won’t be reserved for institutional buyers. In fact, while index funds will be forced to add positions, as many as 22 space-themed exchange-traded funds will likely also offer exposure, which could serve as a boon to AST SpaceMobile.
A successful SpaceX IPO could serve as validation for the entire space economy and the companies that operate in it. Specifically, the D2D satellite connectivity market—in which AST SpaceMobile operates—could see the greatest benefit, as SpaceX’s Starlink attracts more public attention, potentially increasing market visibility for competitors.
Meanwhile, given SpaceX’s expected lofty valuation, investors looking to gain exposure to the D2D market could turn to ASTS for a more welcoming premium.
That isn’t to say AST SpaceMobile is offering a cheap valuation. The over $34 billion market cap company currently trades around 485x sales, has a trailing 12-month earnings per share (EPS) of negative $1.78, and sports a beta of 2.7.
But growth remains the big story. AST SpaceMobile has massive strategic partnerships in place, is increasing its role as a federal contractor, and has seen its metrics consistently improve quarter over quarter. Its book value per share, for example, reached $5.44 in Q1, up more than 200% year over year from $1.80 in Q1 FY2025.
Health Indicator for AST SpaceMobile TradeSmith's Health IndicatorA long-term volatility-based measure designed for securities held 12 months or longer.
Green: Strong and healthy uptrend with normal pullbacks.
Yellow: Significant pullback but still within expected volatility.
Red: Dropped beyond expected volatility; considered unhealthy.
Green Zone (13m+)
1-Year History
Jun 25 Sep 25 Dec 25 Mar 26 Jun 26
ASTS's financial health is in the Green zone, according to TradeSmith. ASTS has been in this zone for over 13 months.
At the same time, AST SpaceMobile’s financial health remains robust. Cash and equivalents rose to $3.03 billion in Q1, up sharply from $1.20 billion in Q3 2025, giving the company a much stronger liquidity position. Revenue has climbed from $500,000 in Q1 2024 to $14.7 million in Q1 2026, showing real commercialization progress.
All of that has led to the stock finding itself in TradeSmith’s Green Zone for more than 13 months.
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Key Takeaways AST SpaceMobile's next launch is set for June 17, 2026, from Cape Canaveral on a Falcon 9 rocket.AST SpaceMobile will deploy BlueBird satellites 8 to10 expanding its direct-to-device broadband network.ASTS' next-generation BlueBirds are expected to nearly double speeds from the earlier 98.9 Mbps record. AST SpaceMobile, Inc. (ASTS - Free Report) has announced that its next orbital launch mission is scheduled for June 17, 2026, from Cape Canaveral, FL, on a SpaceX Falcon 9 rocket. The mission will deploy BlueBird satellites 8, 9 and 10, marking another major step in the company's mission to build the world's first space-based cellular broadband network that connects directly to everyday smartphones without special hardware.
AST SpaceMobile's new BlueBird satellites are designed to enhance its space-based communication services, including voice calls, Internet data and video connectivity for commercial and government users. Built on the company's advanced stackable satellite architecture and lightweight carbon composite structures, the satellites can be launched more efficiently, supporting the faster deployment of its direct-to-device broadband network.
The next-generation satellites are expected to deliver nearly twice the data speeds of their predecessors, which recently achieved download speeds of 98.9 Mbps directly to standard smartphones. Equipped with large 2,400-square-foot communication arrays, the satellites are designed to increase network capacity and coverage.
With a broad base of telecom partners and a rapidly expanding satellite constellation, AST SpaceMobile is advancing its vision of global cellular connectivity from space. The upcoming launch represents another important milestone as the company moves closer to providing seamless mobile broadband service worldwide.
How Are Other Competitors Advancing in the Connectivity Arena?AST SpaceMobile faces competition from Globalstar, Inc. (GSAT - Free Report) and Viasat, Inc. (VSAT - Free Report) . Globalstar has strengthened its satellite connectivity services through its low-Earth Orbit satellite network, which provides voice, data and messaging services in areas without traditional mobile coverage. The company continues to expand its direct-to-device offerings for smartphones and other connected devices.
Viasat provides satellite-based Internet and communication services to consumers, businesses and government customers globally. The company is expanding its satellite network to improve coverage and connectivity. Viasat's ongoing investments are helping improve access to reliable communications in remote and underserved regions.
ASTS’ Price Performance, Valuation and EstimatesAST SpaceMobile shares have rallied 143.3% over the past year compared with the industry’s growth of 54.3%.
Image Source: Zacks Investment Research
From a valuation standpoint, AST SpaceMobile trades at a forward price-to-sales ratio of 81.91, well above the industry average of 5.27.
Image Source: Zacks Investment Research
Earnings estimates for 2026 have declined 47% to a loss of $1.47 per share over the past 60 days, while the same for 2027 has decreased to a loss of 38 cents per share.
A month has gone by since the last earnings report for AST SpaceMobile, Inc. (ASTS - Free Report) . Shares have added about 21.6% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is AST SpaceMobile due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important drivers.
ASTS Reports Wider-Than-Expected Q1 Loss Despite Revenue Expansion
AST SpaceMobile reported lackluster first-quarter 2026 results, with both top and bottom lines missing the Zacks Consensus Estimate.
The company reported revenue growth year over year, driven by gateway hardware sales and U.S. government contract revenues. The company also expanded satellite production and partnerships while advancing BlueBird satellite launches. However, higher operating and launch costs, along with macroeconomic uncertainty, continued to pressure its bottom line.
Quarter Details
Net loss in the reported quarter was $191 million or a loss of 66 cents per share compared with a loss of $45.7 million or a loss of 20 cents per share in the year-ago quarter. The reported loss was wider than the Zacks Consensus Estimate of a loss of 23 cents.
Quarterly revenues surged to $14.7 million from $0.72 million in the year-ago quarter, primarily driven by commercial gateway equipment sales and project-related revenue from U.S. government contracts. However, the top line missed the Zacks Consensus Estimate of $38.2 million.
In the first quarter, Product revenues increased to $13.4 million from $0.38 million, and Services revenues increased to $1.3 million from $0.34 million in the prior-year quarter.
Other Details
In the March quarter, total operating expenses rose to $164.1 million from $63.7 million in the year-ago quarter. This was due to increased general and administrative costs and engineering services expenses. Adjusted operating expenses for the first quarter were $91.2 million.
Cash Flow & Liquidity
In the first quarter, the company utilized $48.1 million of cash for operating activities compared with a cash utilization of $28.5 million in the year-ago period. As of March 31, 2026, it had $3.03 billion in cash and cash equivalents with $2.96 billion in long-term debt.
How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -31.62% due to these changes.
VGM ScoresAt this time, AST SpaceMobile has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. However, the stock was allocated a score of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
OutlookEstimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise AST SpaceMobile has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry PlayerAST SpaceMobile is part of the Zacks Wireless Equipment industry. Over the past month, Motorola (MSI - Free Report) , a stock from the same industry, has gained 5.8%. The company reported its results for the quarter ended March 2026 more than a month ago.
Motorola reported revenues of $2.71 billion in the last reported quarter, representing a year-over-year change of +7.4%. EPS of $3.37 for the same period compares with $3.18 a year ago.
For the current quarter, Motorola is expected to post earnings of $3.86 per share, indicating a change of +8.1% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
Motorola has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of D.
Key Takeaways Verizon expanded broadband, raised 2026 adjusted EPS guidance and reiterated cash flow guidance.AST SpaceMobile plans a June 17 launch for BlueBird 8, 9 and 10 with higher expected peak data speeds.VZ and ASTS differ in estimates, valuation metrics, price performance and stated execution challenges. Verizon Communications Inc. (VZ - Free Report) and AST SpaceMobile (ASTS - Free Report) are both strengthening their capabilities to expand the reach and accessibility of wireless connectivity. AST SpaceMobile is building the world’s first and only global cellular broadband network in space, accessible directly by standard smartphones (4G-LTE/5G devices) for commercial and government use, leveraging its extensive Intellectual Property and patent portfolio. As one of the leading wireless carriers in the United States, Verizon delivers communication services to a vast customer base across the public sector, small and medium businesses, as well as global enterprises.
Per a report from Precedence Research, the global wireless connectivity market was valued at $134.77 billion in 2026. It is expected to reach $412.84 billion in 2035, with a compound annual growth rate of 13.31%. The broader connectivity market is entering a phase where terrestrial wireless networks and satellite networks are converging rather than competing. Let us delve a little deeper into the companies’ competitive dynamics to understand which of the two is relatively better placed in this broader sector.
The Case for VerizonVerizon’s broadband build continues to broaden its addressable market and create more room to sell converged offers over time. In first-quarter 2026, Verizon delivered 341,000 broadband net additions, including 214,000 fixed wireless access net additions and 127,000 fiber broadband net additions, bringing fixed wireless access and fiber broadband connections to about 16.8 million.
Verizon has launched a company-wide transformation initiative aimed at becoming an AI-first organization. The program emphasizes automation, AI-powered customer interactions, digital sales channels, micro-segmentation, and process simplification to enhance customer experience while improving operational efficiency. Through these initiatives, the company targets approximately $5 billion in operating expense savings and higher long-term profitability. AI integration will serve as a key enabler across its operations.
Moreover, Verizon continues to strengthen its network capabilities through investments in fiber infrastructure, network excellence, and advanced cybersecurity. Its participation in Anthropic's Project Glasswing underscores this strategy, leveraging cutting-edge artificial intelligence to identify complex vulnerabilities and bolster the security and resilience of its critical network infrastructure. The company faces stiff competition in the U.S. telecom market from other industry leaders such as AT&T and T-Mobile. However, its strong focus on innovation and customer retention strategies, such as bundled plan offerings, enables it to gain a competitive edge.
Verizon’s 2026 outlook reflects higher management confidence in earnings delivery, supported by cost actions and a more disciplined promotional stance. Verizon raised 2026 adjusted EPS guidance to $4.95-$4.99 from $4.90-$4.95 expected earlier. The company also reiterated 2026 cash flow from operations guidance of $37.5 billion to $38.0 billion and free cash flow guidance of $21.5 billion or more.
The Case for ASTSUtilizing large phased array antennas, AST SpaceMobile’s technology is backed by approximately 3,900 patents and patent-pending claims. This design aims to deliver worldwide cellular coverage by eradicating dead zones and providing space-based connectivity to areas that lack broadband service.
The company has deployed an initial set of commercial satellites in low Earth orbit, branded BlueBird, and continues to expand its launch campaign. These satellites support non-continuous service and have been used to validate voice and data capabilities directly to unmodified smartphones. BlueBird 6, which features an approximately 2,400 square-foot communications array, remains in orbit and operating as expected.
The company recently announced that BlueBird satellites 8, 9 and 10 are scheduled to launch aboard a Falcon 9 rocket on June 17, 2026. The BlueBird 8, 9 and 10 satellites are expected to deliver nearly double the peak data speeds achieved by the company's initial Block 1 BlueBird satellites, which recently demonstrated download speeds of 98.9 Mbps directly to standard smartphones. The major advancement in throughput will allow the company to effectively support the most demanding applications used by enterprises.
However, AST SpaceMobile operates in a highly competitive mobile satellite services market with high development and launch costs and well-funded incumbents. Competition in direct-to-device satellite communications is increasing rapidly. Existing and new industry leaders like SpaceX’s Starlink, Viasat, Inc. (VSAT - Free Report) are expanding their SATCOM infrastructure. Viasat announced the successful launch and initial signal acquisition of its ViaSat-3 Flight 3 (F3) satellite, completing the company’s next-generation global ViaSat-3 constellation. The satellite is designed to provide more than 1 Tbps of throughput capacity across the Asia-Pacific region. ViaSat-3 F3 features advanced beamforming and flexible bandwidth allocation capabilities, enabling Viasat to dynamically direct capacity toward high-demand commercial, enterprise and defense markets.
AST SpaceMobile relies on third-party launch providers, and any failure, delay, or underperformance could disrupt satellite deployment and push out commercialization timelines. In April 2026, the Block 2 BlueBird 7 satellite was placed into a lower-than-planned orbit, separated and powered on, but was de-orbited because the altitude was too low for sustained operations. Scale and execution risk remain one of the biggest concerns for investors regarding ASTS. The company must successfully coordinate satellite manufacturing, launch schedules, telecom network integration, regulatory approvals and, ultimately, large-scale commercial service activation. Recent events underscore these challenges.
How Do Zacks Estimates Compare for VZ & ASTS?The Zacks Consensus Estimate for Verizon’s 2026 sales and EPS implies year-over-year growth of 3.27% and 5.31%, respectively. The EPS estimate for 2026 have moved northward over the past 60 days.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for AST SpaceMobile’s 2026 sales implies year-over-year growth of 132.32%, while that for EPS suggests a decline of 9.7%. The EPS estimate has declined over the past 60 days.
Image Source: Zacks Investment Research
Price Performance & Valuation of VZ & ASTSOver the past year, VZ has gained 4.7% compared to ASTS’ growth of 143.2%.
Image Source: Zacks Investment Research
Verizon looks more attractive than AST SpaceMobile from a valuation standpoint. Going by the price/sales ratio, ASTS’ shares currently trade at 81.91 forward sales, significantly higher than 1.33 for VZ.
Image Source: Zacks Investment Research
VZ or AST SpaceMobile: Which is a Better Pick?VZ carries a Zacks Rank #3 (Hold), while ASTS has a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Both companies are taking several initiatives to expand their next-generation connectivity portfolio. ASTS’ growing prowess in the direct-to-device broadband capability is evident from its recent achievements. However, the execution risks of ASTS’s massive and technologically intricate project remain a major concern for investors. Verizon is benefiting from strong wireless subscriber additions. The company reported its first positive first-quarter postpaid phone net additions since 2013. This was possible due to lower churn and improved customer satisfaction. Verizon’s focus on AI integration and improving cybersecurity is a positive factor. Owing to these factors and a better Zacks Rank, Verizon is a better investment option at present.
SpaceX, the aerospace and AI company founded by Elon Musk, will likely become the largest IPO in history when it goes public on June 12. But at its target valuation of $1.77 trillion, it will be valued at 95 times its 2025 sales. It's also more than four times oversubscribed.
Instead of chasing SpaceX's wild market debut, it's smarter to buy two other stocks that will benefit from the same tailwinds without the stomach-churning volatility: Rocket Lab (RKLB +9.42%), which launches reusable orbital rockets like SpaceX, and AST SpaceMobile (ASTS +11.83%), which produces Low Earth Orbit (LEO) satellites like SpaceX's Starlink.
Image source: Getty Images.
Why are both space stocks worth buying? Rocket Lab and AST don't directly compete with SpaceX, but they'll benefit from growth in the same markets. Rocket Lab has already launched 88 rockets to date, and it's expanding its business with more orbital and spacecraft manufacturing services. AST, which helps telecom companies cover rural areas with wireless satellite connections, plans to have 45 to 60 satellites in orbit by the end of 2026, and up to 248 satellites within the next few years.
Today's Change
(
9.42
%) $
9.90
Current Price
$
114.95
From 2025 to 2028, analysts expect Rocket Lab's revenue to more than double, and for AST's revenue to surge more than 26 times. Both stocks are also arguably cheaper than SpaceX relative to their near-term growth potential, but the same rising tide should lift their boats.
Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AST SpaceMobile and Rocket Lab. The Motley Fool has a disclosure policy.
When the sector's largest company sets its price, every other space stock suddenly has a number to be measured against. That reckoning is happening now.
Baystreet.ca News Commentary
, /PRNewswire/ -- Markets run on price discovery, and there is no more dramatic example than the moment a long-private giant finally tells the world what it thinks it is worth. As reported, that moment arrives for SpaceX around now, with the company's initial public offering expected to price ahead of its Nasdaq debut. The number it lands on will not just value one company — it will recalibrate how investors value an entire sector, because for the first time the orbital economy will have a public, market-cleared anchor at its center.
That repricing is landing on a sector that public markets have only just begun to formally embrace. Just days ago, the broad-market Russell 3000® Index confirmed it is adding commercial-space names in its 2026 reconstitution — including Starfighters Space, Inc. (NYSE: FJET), effective June 29, 2026 — a structural signal that space has grown large enough to register on the market's broadest screens. The pricing of SpaceX and the indexing of its smaller peers are two halves of the same story: capital is assigning real, public value to space at a pace and scale the sector has never experienced.
Putting a Number on the Untouchable
For most of its life, SpaceX could only be valued through the narrow window of private funding rounds and secondary sales — numbers visible to a select few. Its public offering changes that overnight. Having filed its public S-1 and applied to list on Nasdaq under the ticker SPCX, the company is reported to be pricing its shares around $135, at a valuation measured in the trillions of dollars, with a raise that at the upper end would stand among the largest in the history of public markets. (All figures are as reported and remain subject to final pricing.) Much of the case rests on Starlink, the satellite-broadband arm estimated to drive the majority of company revenue.
The significance for everyone else is the benchmark effect. Once the market sets a public price on the sector's flagship, every other space company is implicitly measured against it — on growth, on margins, on the multiple investors are willing to pay for a slice of the orbital economy. Some names will look cheap by comparison; others expensive. But all of them gain something they lacked before: a reference point. Price discovery at the top cascades down through the whole category.
A Sector Being Valued in Real Time
The clearest evidence that this is a sector-wide repricing, not a one-company event, is how broadly capital has been moving across listed space names — spanning space stations, direct-to-phone satellites, Earth observation, and the advanced manufacturing that makes missions possible. Four names map that breadth.
CONTINUED … Learn more about Starfighters Space, Inc. at: https://usanewsgroup.com/fjet-landing
Voyager Technologies, Inc. (NYSE: VOYG) has become a centerpiece of the 'space has never been hotter' narrative. The defense-and-space company is developing Starlab, a commercial successor to the International Space Station, and recently agreed to acquire lunar-delivery specialist Astrobotic in a deal valued at up to $300 million to deepen its Moon-economy exposure. With analysts raising targets and management raising guidance, Voyager illustrates how quickly the market is re-rating credible space-infrastructure stories.
AST SpaceMobile, Inc. (NASDAQ: ASTS) is pursuing one of the sector's boldest ideas: a satellite network that connects directly to ordinary, unmodified smartphones, in partnership with major carriers. With a North American spectrum settlement and its own pending addition to the Russell 1000® Index, ASTS shows how the market is willing to assign substantial value to space companies attacking enormous terrestrial end-markets — in its case, global mobile connectivity.
Planet Labs PBC (NYSE: PL) operates one of the largest Earth-observation satellite fleets in the world, selling imagery and analytics to agriculture, government, mapping, and defense customers. As a data-and-analytics business built on space hardware, Planet represents the recurring-revenue, information-services layer of the orbital economy — a different and increasingly valued way to monetize space.
Velo3D, Inc. (NASDAQ: VELO) supplies metal additive-manufacturing systems used to build mission-critical components for space, aviation, and defense programs — a reminder that the repricing sweeping the sector reaches the specialized manufacturers behind the hardware, not just the launch and satellite names. After posting first-quarter 2026 revenue up 48% year-over-year and reaching a positive gross-margin inflection, Velo3D represents the production-and-supply-chain layer of the orbital economy. These companies are referenced to illustrate the breadth of the space sector and do not imply any partnership, endorsement, affiliation, or comparable financial performance; they differ widely in size and stage.
Where Starfighters Sits in the Repricing
Starfighters Space brings a model that looks like none of the above. The company operates what it describes as the world's only flight-ready MACH 2+ supersonic aircraft fleet from NASA's Kennedy Space Center, pursuing air-launch — releasing a vehicle from a fast, high-flying aircraft so the launch system inherits altitude and speed, with the runway responsiveness and reusability an aircraft platform implies. As a freshly public, recently indexed company, it is precisely the kind of differentiated niche name that a sector-wide repricing tends to surface, as investors hunt for exposure beyond the obvious giants. CEO Tim Franta framed the Russell inclusion as a milestone reflecting growing awareness of that differentiated platform.
The caution is the same one that applies to any emerging name: Starfighters is early-stage and small-cap, its shares have been volatile, and a benchmark anchor set by a trillion-dollar peer cuts both ways — it can lift sentiment, but it also raises the bar for what investors expect operators to deliver. The opportunity and the scrutiny arrive together.
Why the Timing Is the Whole Story
Sectors do not get repriced on a random Tuesday. They get repriced when a catalyst forces the market to look at an entire category with fresh eyes — and the SpaceX pricing is exactly that kind of forcing event. For years, valuing a space company meant arguing by analogy, because the sector lacked a large, liquid, public reference point. Private marks were stale and selective; public space names were too small or too varied to anchor the category. The pricing of a trillion-dollar flagship removes that excuse. Suddenly there is a live, visible multiple attached to the most scrutinized space business in the world, and every analyst model in the sector has to be re-run against it.
That is why the days around a mega-listing tend to see the sharpest moves across an entire peer group, in both directions. Capital that had been waiting on the sidelines for a credible entry point finds one; capital that had been crowded into a handful of names reallocates as the opportunity set widens. The result is a burst of price discovery that ripples through launch providers, satellite operators, infrastructure suppliers, and niche specialists alike. Investors who understand that dynamic tend to focus less on the giant's first print and more on how the repricing redistributes attention across the names around it.
A Sector Pulled Into the Mainstream
There is also a structural dimension that outlasts any single trading session. Reporting on the SpaceX offering has emphasized an unusually large intended retail allocation — a deliberate effort to put shares in the hands of ordinary investors rather than reserving them almost entirely for institutions. Whether or not those specifics hold at pricing, the signal is meaningful: the sector's flagship is being positioned as a broadly owned, mainstream holding, not a closed institutional club. That ambition, paired with index inclusion sweeping smaller space names into benchmark funds, points to the same destination — space becoming a category that shows up in everyday portfolios, retirement accounts, and index products, not just venture funds and specialist mandates.
For the companies in the sector, mainstream ownership changes the game. It deepens liquidity, broadens the shareholder base, and raises the profile of the entire category — which in turn makes it easier for emerging names to be discovered, researched, and ultimately financed. A rising profile for the sector's giant tends to raise the ceiling for everyone operating credibly beneath it. That is the quiet, compounding benefit of a watershed listing: it does not just value one company; it expands the audience for the whole field.
The Number That Reframes Everything
By the time the week is out, the space sector will have something it has never had: a public, market-set price on its single most important company. That number becomes the gravitational center around which every other valuation in the sector orbits. For investors, the pricing of SpaceX is not the end of the story — it is the moment the whole sector gets a yardstick. And with the broadest U.S. index simultaneously folding space names into trillions in tracked capital, the orbital economy is being measured, valued, and owned by the public market all at once.
CONTINUED … Learn more about Starfighters Space, Inc. at: https://usanewsgroup.com/fjet-landing
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SOURCES:
[1] Starfighters Space, Inc. — "Starfighters Space (NYSE: FJET) Added to Membership of Russell 3000® Index" (Business Wire, June 3, 2026; inclusion effective June 29; CEO Tim Franta quote):
https://finance.yahoo.com/markets/stocks/articles/starfighters-space-nyse-fjet-added-100000658.html
[2] FTSE Russell / Investing.com — 2026 Russell reconstitution detail ($12.2T benchmarked; Russell 3000 up 29% to $75.6T; rank day April 30; SIDU and OPTX also added): https://www.investing.com/news/company-news/starfighters-space-added-to-russell-3000-index-effective-june-29-93CH-4723661
[3] TECHi / Reuters — SpaceX IPO terms (S-1/A June 1; Nasdaq symbol SPCX; reported ~$135/share, pricing targeted June 11, debut June 12; figures as reported, subject to final pricing): https://www.techi.com/spacex-ipo/
[4] Bloomberg — SpaceX record-IPO scale (reported raise up to ~$75B; valuation in the trillions; would rank among the largest offerings ever): https://www.bloomberg.com/graphics/2026-spacex-ipo-stock-market-nasdaq-listings/
[6] Stocktwits — space-sector trading and sentiment coverage into the SpaceX pricing window (ASTS, PL, VOYG and peers): https://stocktwits.com/news-articles/markets/equity/space-stocks-slip-spacex-ipo-buzz-retail-bullish-bear-case/cZ0Sr77ReDq
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