The firm said it expects Amazon to report second-quarter results during the week of July 27, with broad-based strength led by accelerating growth in Amazon Web Services (AWS).
AWS Growth And Earnings ExpectationsBNP Paribas analyst Nick Jones expects investors to focus on four key areas: AWS growth and capital spending trends amid data center component inflation, the impact of Prime Day on retail sales, advertising growth and operating income margins as the company continues investing heavily in AI infrastructure.
The brokerage expects AWS revenue growth of 33% to 35% in the second quarter, above the consensus estimate of about 31%. It also projects operating income of about $25 billion, compared with the Street consensus of $23.6 billion.
Third-Quarter Outlook And AI SpendingFor the third quarter, BNP Paribas believes investors are looking for Amazon to guide toward the high end of its outlook, with revenue of about $207 billion and operating income of $26 billion. Those figures are above current consensus estimates of $204 billion and $25 billion, respectively.
The firm added that investors are also likely to expect higher full-year 2026 capital expenditure guidance as rising data center component costs increase AI infrastructure spending.
Retail Trends And Financial EstimatesBNP Paribas said data indicate Amazon’s Online Stores and Third-Party Seller Services businesses remain broadly in line with Wall Street expectations, implying about 14% year-over-year revenue growth. The firm left its financial estimates unchanged ahead of the earnings release.
Valuation And Analyst ViewDespite ongoing concerns about the return on investment from data center spending, BNP Paribas said it expects continued AWS acceleration and solid execution across Amazon’s businesses.
The firm also said the stock’s current valuation remains an attractive entry point, with shares trading broadly in line with their six-month average forward enterprise value-to-EBITDA multiple.
Earnings And Analyst OutlookAmazon is expected to report second-quarter earnings on or around July 30.
Wall Street expects earnings of $1.82 per share, up from $1.68 a year earlier. Revenue is projected to increase to $196.02 billion from $167.70 billion.
The stock carries a consensus Buy rating with an average analyst price forecast of $320.55. Recent analyst actions include:
TD Cowen: Maintained Buy and lowered its price forecast to $340 on July 8. Wells Fargo: Maintained Overweight and raised its price forecast to $313 on July 2. Truist Securities: Maintained Buy and raised its price forecast to $320 on May 29. Amazon Technical AnalysisAmazon traded about 0.6% above its 20-day simple moving average of $239.53.
However, the stock remained about 5.2% below its 50-day simple moving average of $254.20. That suggests the intermediate-term recovery has yet to gain momentum.
The relative strength index (RSI) stood at 46.61, indicating neutral momentum. The reading suggests sellers still hold a slight advantage, although the stock is not yet in oversold territory.
The longer-term trend remains constructive. Amazon continues to trade above its 200-day simple moving average of $233.21. The 50-day moving average also remains above the 200-day moving average following a golden cross formed in May.
Traders are watching resistance near $249.50, close to the 50-day moving average. Initial support sits around $225, where buyers previously stepped in.
AMZN Stock Price Activity: Amazon.com shares were down 0.99% at $241.20 at the time of publication on Thursday, according to Benzinga Pro data.
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For much of the past decade, Wall Street rewarded companies that funneled excess cash into stock buybacks. That playbook is changing. The world’s largest technology companies are now directing hundreds of billions of dollars toward artificial intelligence infrastructure instead of repurchasing shares.
At first glance, that has disappointed investors looking for immediate capital returns. Yet the shift reflects something far more important: management teams believe the return on AI investment exceeds the return on buying back their own stock. Amazon (NASDAQ:AMZN | AMZN Price Prediction) may be one of the clearest examples of why patient investors should pay attention.
Amazon Is Buying Chips Instead of Its Own Stock A recent BofA Global Research report comparing hyperscalers and semiconductor companies on a 12-month forward free cash flow basis illustrates the market’s current divide. Hyperscalers have seen free cash flow pressured as capital expenditures surge, while semiconductor companies are enjoying expanding cash generation as demand for AI chips continues climbing.
The relationship is straightforward. The largest technology companies have largely stopped buying their own shares because they’re buying AI hardware instead.
Amazon hasn’t repurchased any of its stock since the second quarter of 2022. Instead, the company has poured capital into expanding Amazon Web Services (AWS), building AI data centers, developing its Trainium and Inferentia AI chips, and expanding the infrastructure needed to support generative AI.
That spending isn’t unique to Amazon. Alphabet (NASDAQ:GOOG), Microsoft (NASDAQ:MSFT), and Meta Platforms (NASDAQ:META) are all committing record sums to AI infrastructure. The immediate winners have been semiconductor companies supplying the chips powering that buildout.
Ironically, that’s exactly why chipmakers have outperformed.
Management isn’t avoiding buybacks because it lacks confidence. It’s skipping buybacks because executives believe investing billions into AI infrastructure today will generate higher returns tomorrow.
Those investments won’t remain expenses forever. They become revenue-producing assets through AWS cloud services, AI model hosting, custom silicon sales, enterprise software, advertising improvements, and retail automation.
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Amazon also has multiple growth engines working simultaneously:
Growth Driver Opportunity AWS Enterprise cloud and AI workloads continue expanding Custom AI Chips Trainium and Inferentia reduce customer costs while competing with third-party accelerators Retail AI improves fulfillment efficiency and customer recommendations Advertising Higher-margin business continues growing across Amazon’s ecosystem Space Project Kuiper adds another long-term platform opportunity As those investments mature, free cash flow should begin catching up with today’s elevated capital spending.
The Valuation Looks Hard to Ignore This is where the numbers get compelling. Amazon currently trades around 29 times earnings, one of its lowest valuation multiples historically, as shares often trade for 50x or more. Despite rebounding roughly 23% from its trough earlier this year, the valuation remains historically depressed.
Even after the recovery, Amazon shares still trade roughly 14% below their 52-week high. Meanwhile, Wall Street analysts project 22% average annual earnings growth over the next five years.
Granted, heavy capital spending always carries execution risk. If AI demand cools or enterprise customers slow adoption, those returns could take longer to materialize. But Amazon has repeatedly demonstrated its ability to turn large infrastructure investments into highly profitable businesses, from AWS to its logistics network.
Key Takeaway In short, Amazon’s lack of buybacks shouldn’t be mistaken for a lack of confidence. It’s a deliberate capital allocation decision. The company believes every dollar invested in AI infrastructure today can earn more than a dollar spent shrinking the share count.
Semiconductor companies are benefiting first because they’re selling the picks and shovels. Amazon’s payoff should arrive later as those AI investments begin generating higher revenue, expanding margins, and stronger free cash flow.
For investors with a medium- to long-term time horizon, that creates an attractive setup. A company expected to grow earnings roughly 22% annually, trading near some of its lowest valuations ever, while building multiple new AI-driven businesses, doesn’t come along often. Ultimately, today’s muted valuation could prove to be one of the better entry points Amazon has offered in years.
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Amazon (NASDAQ:AMZN | AMZN Price Prediction) and Microsoft (NASDAQ:MSFT) both filed earnings on April 29, 2026, framing two different bets on the AI buildout. Amazon leans on custom silicon and, per a $25 billion multi-tranche bond sale, to fund infrastructure. Microsoft leans on its OpenAI stake and contracted backlog. Same tailwind, different balance sheets.
AWS Reaccelerates While Azure Sprints Ahead Amazon posted EPS of $2.78 against a $1.653 estimate on revenue of $181.52 billion, up 16.61%. AWS grew $37.59 billion in revenue, growing 28%, the fastest pace in fifteen quarters, at a 37.7% operating margin. Ads cleared $70 billion trailing, a real second engine.
Microsoft delivered EPS of $4.27 versus $4.09 expected on $82.89 billion in revenue, up 18.3%. Azure grew 40% (39% constant currency), and the AI business hit $37 billion annual run rate, up 123%. Commercial remaining performance obligations reached $627 billion, nearly doubling year-over-year, contracted demand years out.
Business Driver Amazon Microsoft Cloud growth AWS +28% Azure +40% Q1 CapEx $44.2B $30.88B Operating margin 11.2% 45.6% Custom Silicon Vs. Contracted Compute Andy Jassy said Amazon’s chips business is at $20 billion run rate with triple-digit growth, with total Trainium commitments reaching over $225 billion, including up to 5 GW from Anthropic and 2 GW from OpenAI starting in 2027. Jassy expects Trainium to save “tens of billions of dollars of CapEx each year”.
Microsoft’s leverage is contractual. Satya Nadella framed the quarter around delivering “cloud and AI infrastructure and solutions” for the agentic era. Microsoft leans heavily on NVIDIA silicon and its OpenAI partnership, enormously profitable but leaving less optionality on chips than Amazon has built.
The Capex Bill Is About To Get Louder Amazon’s TTM free cash flow collapsed 95% to $1.2 billion, and long-term debt jumped to $119.1 billion from $65.6 billion. Polymarket traders assign 87.5% probability that 2026 capex tops $200 billion, with a coin-flip on $220 billion or more. Microsoft’s CapEx surged 84.39% year-over-year, and management stayed quiet on numeric guidance. I want to see whether AWS margins hold as this cash deploys.
Why I’m Leaning Toward Amazon Right Now Since the reports, AMZN is down 6.49% and MSFT is down 8.19%. Neither has been rewarded. Amazon’s ability to tap institutional debt cheaply, pair it with a chip stack customers are pre-buying in gigawatts, and still show 29.6% operating income growth on core business tilts the read. Microsoft is a fantastic compounder at 45.6% operating margin, and if you want quality and dividend support, that case is intact. But if custom silicon is the real moat of this cycle, Amazon looks like the fortress trade. I would change my view if AWS margin slips below the mid-30s while capex keeps climbing.
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by Lisa Stiffler on Jul 9, 2026 at 9:00 amJuly 9, 2026 at 8:30 am
Inside a Microsoft data center. (Microsoft Photo) Microsoft has just four more years to reach its ambitious goal of removing more planet-warming carbon that it produces. But the company’s annual sustainability report, released Thursday, shows it’s moving in the opposite direction, as its 2025 emissions spiked 25% over the previous year.
Despite the troubling increase, Microsoft leaders say they remain committed to the longer-term goal.
“We continue to really be focused around carbon negativity by 2030,” said Melanie Nakagawa, chief sustainability officer, in an interview with GeekWire.
The Redmond, Wash.-based company is the latest tech giant to fall further behind its climate targets as they invest billions of dollars in new, energy-hungry data centers to power the AI boom. Amazon’s carbon footprint jumped 16% last year, while Google’s greenhouse gas emissions swelled 18%.
The report also shows how much energy use drove that increase: Microsoft’s emissions from purchased electricity — known as Scope 2 emissions — grew by 25% last year.
In total, Microsoft produced 34 million metric tons of carbon dioxide equivalent in 2025. After subtracting the carbon it paid to remove from the atmosphere, that figure drops to a net 20 million tons. That puts the company’s footprint roughly on par with the total emissions of Panama or Lithuania.
In addition to data center expansion, Nakagawa said, the carbon increase was also driven by Microsoft’s decision to stop buying unbundled, short-term renewable energy certificates, or RECs — a mechanism companies can use to quickly lower their reported emissions for a given year. Microsoft is instead prioritizing longer-term initiatives with bigger impact, she said.
The challenge Microsoft wants to answer, she said, is how to take a “portfolio approach” that spans carbon dioxide removal, carbon-free electricity, sustainable materials, and fuels — addressing all of them together rather than in isolation.
Image from Microsoft’s 2026 sustainability report. Where Microsoft made gains The annual report highlighted areas of success. That includes:
Matching its electricity consumption worldwide with clean energy sources. For the first time, replenishing more fresh water globally than it withdrew, making important progress on its 2030 goal of being water positive across operations. Achieving 92% reuse and recycling of decommissioned cloud servers and components for the second consecutive year. Reaching a total of 40 gigawatts of clean power purchase agreements across 26 countries, with 19 gigawatts currently online. (Forty gigawatts is roughly enough power to serve 30-40 million typical U.S. homes at once.) Scrutiny over recent moves Microsoft’s sustainability disclosures come after a series of announcements and news reports that have raised concerns among climate advocates.
Last month, Microsoft and Chevron announced an agreement to build a natural gas facility in Texas with a 2.67 gigawatt capacity, providing dedicated electricity to the tech company for 20 years. In May, Bloomberg reported that Microsoft was considering scaling down or scuttling a pledge to match its electricity use with carbon-free power around the clock by 2030. In April, the New York Times reported that Microsoft was pausing future purchases of carbon removal credits, after years as the market’s top buyer. Nakagawa said the company has not canceled any canceled removal projects, though she did not provide specifics about new purchases going forward. “We’re just continuing to take a hard look at each of the deals that are coming through,” she said, and looking for “credible opportunities to scale.”
Asked about Microsoft’s commitment to purchasing clean energy 24/7 — an approach that would eliminate reliance on coal- or gas-powered energy when wind and solar aren’t available — Nakagawa declined to confirm it. “We still are looking towards opportunities around carbon-free electricity,” while focusing on the 2030 carbon negative goals, she said.
As to the natural gas deal, the chief sustainability officer said Microsoft has also contracted to purchase 4.7 gigawatts of renewable power in Texas alone and that the company evaluates its energy investments as part of a broader mix.
Looking for efficiencies elsewhere Even as data centers remain the prime driver of Microsoft’s rising energy use and emissions, the company points to other steps aimed at reducing the environmental footprint of the facilities.
That includes increasing the use of lower-carbon steel and concrete and incorporating mass timber into data center buildings. And In the past year, Microsoft has added a seventh Circular Center — one of several facilities worldwide where the company recycles and reuses electronics from data center operations.
Microsoft is also working with developers to use AI models more efficiently and build right-sized products. AI agents can review, test and improve code so it uses less energy when it runs, Nakagawa said.
“I definitely think there’s an opportunity here,” she said.
New York, New York--(Newsfile Corp. - July 9, 2026) - Bronstein, Gewirtz & Grossman, LLC, a nationally recognized investor-rights law firm, announces that a class action lawsuit has been filed against Microsoft Corporation (NASDAQ: MSFT) and certain of its officers.
This lawsuit seeks to recover damages against Defendants for alleged violations of the federal securities laws on behalf of all persons and entities that purchased or otherwise acquired Microsoft securities between May 1, 2025 and January 28, 2026, both dates inclusive (the "Class Period"). Such investors are encouraged to join this case by visiting the firm's site: bgandg.com/MSFT.
Microsoft Case Details
The Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements because they failed to disclose that:
Microsoft's Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; Microsoft's flagship proprietary AI model ranked well below competitors on a number of benchmark tests; Microsoft needed to increase by billions of dollars its capital expenditures and divert graphics processing unit ("GPU") and central processing unit ("CPU") capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related research and development ("R&D"); and as a result of the above, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and Microsoft's Copilot offerings had lost market share to rival products, a trend that was increasing.What's Next for Microsoft Investors?
A class action lawsuit has already been filed. If you wish to review a copy of the Complaint, you can visit the firm's site: bgandg.com/MSFT, or you may contact Peretz Bronstein, Esq. or his Client Relations Manager, Nathan Miller, of Bronstein, Gewirtz & Grossman, LLC at 917-590-0911. If you suffered a loss in Microsoft you have until August 11, 2026, to request that the Court appoint you as lead plaintiff. Your ability to share in any recovery doesn't require that you serve as lead plaintiff.
No Cost to Microsoft Investors
We, Bronstein, Gewirtz & Grossman LLC, represent investors in class actions on a contingency fee basis. That means we will ask the court to reimburse us for out-of-pocket expenses and attorneys' fees, usually a percentage of the total recovery, only if we are successful.
Why Bronstein, Gewirtz & Grossman, LLC for Microsoft Securities Class Action?
Bronstein, Gewirtz & Grossman, LLC is a nationally recognized firm that represents investors in securities fraud class actions and shareholder derivative suits. Our firm has recovered hundreds of millions of dollars for investors nationwide. More at www.bgandg.com
"Our practice centers on restoring investor capital and ensuring corporate accountability, which serves to uphold the essential integrity of the marketplace," said Peretz Bronstein, Founding Partner of Bronstein, Gewirtz & Grossman, LLC.
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To view the source version of this press release, please visit https://www.newsfilecorp.com/release/301528
Source: Bronstein, Gewirtz & Grossman, LLC
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Six gigawatts. That is the total AMD Instinct GPU capacity AMD (NASDAQ:AMD | AMD Price Prediction) will deploy for Meta under a partnership disclosed alongside its most recent earnings, with the first 1-gigawatt tranche powered by a custom MI450-based GPU. For scale reference, one gigawatt is roughly the output of a large nuclear reactor. Meta is committing to power-plant-scale AMD silicon, and it is doing so on top of a separate 6-gigawatt OpenAI agreement already on the books.
The total investment in compute for AMD has been rumored to be around $300 billion, though we’ll see what ultimately gets invested over time. Indeed, that’s the big question mark right now in financial markets.
What It Means Hyperscalers do not sign gigawatt-scale accelerator agreements as hedges. They sign them when they intend to build. That reframes AMD from a challenger chasing NVIDIA (NASDAQ:NVDA) into a co-supplier for the largest AI infrastructure buildouts in the world.
The financial fingerprints are already on the tape. Q1 FY2026 Data Center revenue reached $5.775 billion, up 57% year over year, making it the largest and fastest-growing of AMD’s four segments. Total Q1 revenue landed at $10.253 billion, up 37.9% year over year, beating the $9.91 billion consensus by 3.41%. Non-GAAP EPS came in at $1.37 versus $1.29 expected, driven by non-GAAP gross margins which expanded to 55% (up 170 basis points year over year).
Cash generation is scaling with the mix shift. Q1 free cash flow hit $2.566 billion, up 252.96% year over year, on operating cash flow of $2.955 billion. Net income more than doubled to $1.383 billion, up 95.06%.
Market Reaction AMD shares closed at $517.82 on July 2, 2026, down 4.26% on the day. That single-session dip is noise inside a much larger move. AMD is up 141.79% year to date from $214.16 at the end of 2025, and up 273.82% over the past year. For context, over the same twelve months, NVIDIA is up 24.06%.
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Bull Case The AMD bull case rests on a simple observation – the company’s customer roster now looks like NVIDIA’s. AWS, Google Cloud, Microsoft Azure, and Tencent are expanding 5th Gen EPYC-powered instances. Meta is the lead customer for 6th Gen EPYC (Venice and Verano). Oracle Cloud Infrastructure is standing up a 50,000-GPU AI supercluster using AMD Helios rack design in Q3 2026. Samsung is supplying HBM4 memory for the MI455X.
Guidance points to further acceleration. AMD guided Q2 FY2026 revenue to roughly $11.20 billion, implying about 46% year-over-year growth, with non-GAAP gross margin expanding to about 56%. On the Q1 call, CEO Lisa Su said, “Customer engagement around MI450 Series and Helios is strengthening, with leading customer forecasts exceeding our initial expectations and a growing pipeline of large-scale deployments providing us with increasing visibility into our growth trajectory.”
The pressure on rivals is visible in relative performance. Intel (NASDAQ:INTC) still carries a negative EPS of -$0.60 on a trailing basis, with quarterly earnings growth down 71.7% year over year. NVIDIA remains the incumbent, but AMD is winning nameplate capacity commitments rather than trial orders. Analyst posture reflects it: 41 buy or strong buy ratings against 10 holds and zero sells, with a consensus target of $508.31.
Bottom Line Six gigawatts from Meta and another six from OpenAI turn AMD’s AI narrative from optionality into contracted backlog. For long-term holders, the anchor to watch is Data Center revenue, which drove the Q1 beat and underpins Q2 guidance of about $11.20 billion in total revenue.
AMD’s valuation is stretched, with a forward P/E of 77 on a stock up 141.79% year to date leaves little room for execution slips. But, the shipments behind those gigawatts are what the next earnings report will need to prove. That is the number that decides whether the pressure on rivals turns into permanent market share.
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Alibaba (BABA) valuation is raised to $144–$165/share, reflecting narrowing Quick Commerce (QC) losses and accelerating AI/cloud momentum. BABA's QC segment is approaching breakeven, with losses expected to shrink from RMB 16bn to RMB 10bn sequentially, supporting margin recovery. We see BABA's forward P/E multiple as a valuation floor, with potential for re-rating as QC profitability and high-margin cloud growth materialize.
A Lufthansa Boeing is surrounded by ambulances and other emergency vehicles after several staff members were injured when the nose gear of a Boeing 787 jetliner unexpectedly collapsed at a... Purchase Licensing Rights, opens new tab Read more
BERLIN, July 9 (Reuters) - German aviation accident investigators said on Thursday that a misplaced locking pin was involved in the nose gear collapse of a Boeing 787 at a gate at Frankfurt airport last month.
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A locking pin had not been inserted in the nose gear before the collapse that left several staff members injured.
The device was instead found in a storage box in the aircraft's forward hold, said the BFU federal aviation accident investigation bureau in an interim report.
The Lufthansa (LHAG.DE), opens new tab Boeing B787-9 (BA.N), opens new tab jetliner was being prepared for a long-haul flight to Los Angeles at a terminal parking stand on June 4 when its nose gear collapsed.
According to the report, there were 28 people inside the aircraft, including technicians, crew members and ground staff, when the nose landing gear unexpectedly retracted.
Six other individuals outside were directly involved.
The investigation is not yet complete, and an analysis, including a determination of the causes, will only be provided in the final report, expected in about a year.
Reporting by Klaus Lauer, Writing by Miranda Murray; Editing by Alexandra Hudson
Our Standards: The Thomson Reuters Trust Principles., opens new tab
Key Takeaways NKE's recovery is uneven as running, training and North America improve, but Sportswear and China drag.NIKE Direct revenues fell 7% in Q4 fiscal 2026, with Digital down 12% and owned stores down 7%.Wholesale offers relief, rising 4% in Q4 fiscal 2026 and 6% for the year, led mainly by North America. NIKE, Inc. (NKE - Free Report) is trying to turn a narrower set of operating wins into a broader recovery. The problem is that the gains are still uneven.
Running, global football, training and North America are improving. Sportswear, Jordan Streetwear, NIKE Direct and Greater China continue to pressure demand, pricing and near-term visibility.
NKE Recovery Is Split by CategoryThe clearest progress is coming from performance categories. Running has delivered five consecutive quarters of double-digit growth and added roughly $1 billion over that span. Performance product grew mid-single digits in fiscal 2026, with positive retail sales comparisons across running, training and global football in the fourth quarter.
Management expects growth to expand beyond running into training, basketball and ACG in fiscal 2027. Still, Sportswear and Jordan Streetwear remain weak. Sell-through is challenged, discounting is elevated and future order books are being affected.
NIKE Direct Still Drags on GrowthNIKE Direct remains one of the biggest gaps in the recovery. In the fourth quarter of fiscal 2026, NIKE Direct revenues fell 7% on a reported basis and 9% on a currency-neutral basis to $4.1 billion. NIKE Brand Digital declined 12%, while NIKE-owned stores were down 7%.
The weakness matters because Sportswear and Jordan Streetwear together represent about half of NIKE’s revenues. NIKE is reducing promotions, repositioning digital as a premium business and working to elevate 50% of its owned-store fleet by the end of fiscal 2027. That reset can help brand health, but it also slows the pace of revenue improvement.
NKE Wholesale Rebound Offers Some ReliefWholesale is providing a partial offset. Fourth-quarter fiscal 2026 wholesale revenues rose 4% on a reported basis and 1% on a currency-neutral basis to $6.6 billion, driven mainly by North America. In fiscal 2026, wholesale revenues increased 6% on a reported basis and 4% on a currency-neutral basis.
NIKE is rebuilding partner relationships through curated assortments, better in-store presentation and sport-led storytelling. DICK’S Sporting Goods Inc.’s (DKS - Free Report) Foot Locker is an important marker in that process, as NIKE’s revenue growth and retail sales comparisons as the retailer turned positive for the first time in four years. adidas AG (ADDYY - Free Report) , a major athletic footwear and apparel peer, remains a useful comparison point for investors watching whether NIKE can regain product momentum while protecting brand premium.
NIKE China Reset Clouds Near-Term VisibilityGreater China remains a major overhang. Fourth-quarter revenues in the region fell 12% on a reported basis and 17% on a currency-neutral basis to $1.3 billion. NIKE Direct declined 14%, including a 25% drop in NIKE Digital and a 9% decrease in NIKE stores, while wholesale declined 19%.
In fiscal 2026, Greater China revenues declined 11% on a reported basis and 13% on a currency-neutral basis to $5.85 billion. NIKE has seen digital full-price realization improve and inventory decline by double digits, but management expects near-term revenue trends in the region to remain in line with recent performance.
NKE Signals Point to Ongoing CautionThe bottom line is that NIKE’s recovery has real operational green shoots, but not enough broad-based strength yet. Performance categories and wholesale are improving, while Sportswear, Jordan Streetwear, direct channels and China continue to weigh on the pace of a cleaner rebound.
NKE currently carries a Zacks Rank #4 (Sell). The stock also has a Value Score of D, Growth Score of F, Momentum Score of F and VGM Score of F. Style Scores are designed to complement the Zacks Rank, with stronger grades generally pointing to more favorable value, growth or momentum characteristics.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
For NIKE, those signals support a cautious stance. A weak Rank reflects pressure in earnings estimate trends, while weak Style Scores suggest limited support from valuation, growth and momentum factors. Until category strength spreads more widely across channels and geographies, the stock outlook remains tied to execution proof rather than early signs of improvement.
NKE's 2026 reset has cash strength and performance traction, but weak estimates, channel pressure and valuation keep the stock from looking like a bargain.
Key Takeaways NKE's Sport Offense shifted 8,000 teammates into vertical sport teams to sharpen execution.Running has logged five straight quarters of double-digit growth, while lifestyle remains weak.NKE's margin path is clouded by tariff assumptions, lower markdowns and tighter inventory control. NIKE Inc. (NKE - Free Report) is trying to move past fiscal 2026 with a sport-led model and cleaner marketplace. The reset is not linear.
Performance categories, wholesale repair and North America are improving. Yet tariffs, NIKE Direct weakness and Greater China pressure keep the recovery incomplete.
NKE Sport Offense Is Reshaping ExecutionNIKE’s Sport Offense is central to its next phase. The structure moved about 8,000 teammates into vertical sport teams, creating smaller cross-functional groups focused on specific consumer communities.
The goal is faster decisions, sharper product work and more relevant storytelling across product, brand, marketplace and operations. NIKE is trying to rebuild growth through execution and sport authenticity rather than broad promotions.
Management expects core Win Now actions to sunset by the end of the calendar year. That would shift more emphasis to Sport Offense as the operating model guiding Nike, Jordan and Converse.
NKE Performance Demand Is Beating LifestyleThe clearest trend in NIKE’s portfolio is the split between performance and lifestyle. Running has delivered five consecutive quarters of double-digit growth and added roughly $1 billion over that period.
Performance product grew mid-single digits in fiscal 2026. In fourth-quarter fiscal 2026, running, training and global football posted positive year-over-year retail sales comparisons.
Sportswear and Jordan Streetwear remain the drag. Sell-through is still challenged, affecting discounting and future order books. Together, those businesses represent about half of NIKE’s revenue, which makes their recovery critical.
That split also shapes how investors may compare NIKE with adidas AG (ADDYY - Free Report) and Birkenstock Holding plc (BIRK - Free Report) . adidas remains a relevant global athletic competitor, while Birkenstock gives investors another footwear name to watch within the broader shoes and retail apparel space.
NKE Margin Path Depends on Tariff PressureNIKE’s fourth-quarter fiscal 2026 gross margin expanded 890 basis points to 49.2%. That headline number benefited from a 900-basis-point gain tied to the expected recovery of International Emergency Economic Powers Act tariffs. In fiscal 2026, gross margin expanded 20 basis points to 42.9%.
Excluding that benefit, gross margin would have been 40.2%, down 10 basis points year over year. That makes the margin trend more complicated than the reported figure alone suggests.
Management expects gross margin expansion to begin in the first quarter of fiscal 2027. Still, the outlook assumes incremental tariff rates of 10% through the end of July and 15% thereafter.
Reduced markdowns and better operating leverage also matter. NIKE is lowering digital off-price activity, tightening buys and managing inventory more closely, but tariff volatility remains a cost headwind.
NIKE Channel Mix Is Shifting AgainNIKE’s channel strategy is moving back toward a more balanced marketplace. Wholesale revenues grew 6% on a reported basis and 4% on a currency-neutral basis in fiscal 2026.
In fourth-quarter fiscal 2026, wholesale revenues rose 4% reported and 1% currency neutral, led by North America. Revenue growth and retail sales comparisons with Foot Locker turned positive for the first time in four years.
NIKE Direct remains under pressure. NIKE Direct revenues in fourth-quarter fiscal 2026 declined 7% reported and 9% currency neutral, including a 12% drop in NIKE Brand Digital and a 7% decline in owned stores.
The company is reducing promotions and trying to restore a premium experience across digital and physical retail. A healthier wholesale-direct mix could improve demand visibility, but only if Direct stops weakening.
NKE Scorecard Shows Trend Risks Remain HighNIKE’s emerging trends are meaningful, but the investment scorecard still points to caution. The company has visible progress in running, global football, training, wholesale execution and North America, yet the recovery is not broad enough.
Greater China remains in reset mode. Fiscal fourth-quarter revenues in the region declined 12% reported and 17% currency neutral, with NIKE Direct, digital and wholesale all lower.
NKE currently carries a Zacks Rank #4 (Sell). The stock also has a Value Score of D, Growth Score of F, Momentum Score of F and VGM Score of F.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Rank emphasizes earnings estimate revision trends, while the Style Scores help assess value, growth and momentum characteristics. This combination does not erase NIKE’s strategic progress, but it suggests the stock still lacks the near-term support investors typically seek before treating a turnaround as investable.
The State Street SPDR Portfolio MSCI Global Stock Market ETF (SPGM +0.79%) offers broader geographic exposure and a lower expense ratio than the iShares MSCI World ETF (URTH +0.66%).
Both funds serve as core global equity holdings, but they define global differently. While URTH tracks developed markets, SPGM includes emerging markets and a wider range of market capitalizations, providing a more comprehensive slice of international stocks for a fraction of the cost.
Snapshot (cost & size)MetricURTHSPGMIssueriSharesSPDRShare price (as of July 6, 2026)$204.44$86.02Expense ratio0.24%0.09%1-yr return (as of July 6, 2026)21.4%25.6%Dividend yield1.4%1.8%Beta0.950.92AUM$8.1 billion$1.9 billionBeta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
SPGM is more affordable, with a 0.09% expense ratio compared to 0.24% for its iShares peer. Additionally, the State Street fund currently provides a higher payout, with a yield gap of 0.40 percentage points.
Performance & risk comparisonMetricURTHSPGMMax drawdown (5 yr)(26.1%)(25.9%)Growth of $1,000 over 5 years (total return)$1,729$1,718What's insideState Street’s ETF provides broad exposure to established and developing markets, covering sectors like technology at 31%, financial services at 16%, and industrials at 12%. Its largest positions among 2,933 holdings include Nvidia (NVDA 0.88%) at 3.99%, Apple (AAPL +0.49%) at 3.98%, and Microsoft (MSFT 0.96%) at 2.39%. The fund was launched in 2012. SPGM has paid $1.54 per share over the trailing 12 months, which on its recent ~$86.02 share price works out to a 1.8% yield.
The iShares fund focuses exclusively on developed economies, with a portfolio leaning into technology at 31%, financial services at 16%, and industrials at 11%. Top holdings among its 1,287 positions include Apple at 5.1%, Nvidia at 5.01%, and Microsoft at 3.03%. URTH was launched in 2012. The iShares ETF has paid $2.84 per share over the trailing 12 months, which on its recent ~$204.44 share price works out to a 1.4% yield.
For more guidance on ETF investing, check out the full guide at this link.
What this means for investorsURTH and SPGM share several commonalities. Their five-year returns and max drawdowns are about the same. Both have low betas. Their top 10 holdings even include the same eight stocks among them! However, the iShares ETF has a higher expense ratio and lower dividend yield, which may be unattractive to some investors.
One significant difference between URTH and SPGM is their size. The iShares fund has over $8 billion in assets under management, while its counterpart has just under $2 billion. Accordingly, URTH has a much higher average trading volume, and the increased liquidity that accompanies that may be more attractive than SGPM's lower cost and higher dividend yield.
Erin Kennedy has positions in Apple. The Motley Fool has positions in and recommends Apple, Microsoft, and Nvidia. The Motley Fool has a disclosure policy.
The artificial intelligence (AI) bellwether has had its bell rung lately. Is the ding a dinner bell for opportunistic investors? Nvidia (NVDA 0.88%) may have kicked off the AI revolution a couple of years ago, but the market has been rotating out of the global leader lately.
Nvidia stock has fallen 14% since hitting an all-time high in May. Despite inching higher through the first three trading days of this week, the shares are lower over the past month. It's a stunning contrast to the overall market, which is clawing toward fresh highs.
Image source: Getty Images.
Rotation out of the leading AI chipmaker while business is still booming is surprising, but it's not without precedent. More importantly, it's not likely to be permanent. Bullish market sentiment turning its buy order attention to the next step of AI beneficiaries, including memory and data storage manufacturers, earlier this year, isn't outlandish, even if that segment has come under selling pressure in recent weeks.
You can go up and down the pick-and-shovel ecosystem in the near term. It just seems as if you can't ignore the lead horse over the long run.
Nvidia stock is facing plenty of challenges right now, but they seem small compared to the opportunity. Let's take a closer look at the company that continues to be the largest player by market cap, but one that is now the cheapest that it's been in years, according to one popular valuation metric.
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You can buy Nvidia for just 16 times next year's earnings You read that subhead correctly. Nvidia is now trading for 23 times this fiscal year's earnings, but an even more jaw-dropping 16 times next year's analyst profit target. There are some potential headwinds out there, and I don't want to dismiss them.
China's DeepSeek is making waves again. Its latest DSpark inference module reportedly improves AI rendering speed by up to 85% without requiring new hardware. If you can do more with existing hardware, there is no need to upgrade to Nvidia's shiniest new chips. That's not something you just sweep under the rug, but do you remember when Nvidia tumbled in early 2025, when DeepSeek made headlines? Nvidia's growing client base needs reliability more than it craves the gamble of cutting corners.
Nvidia's revenue has accelerated for three consecutive quarters. The 85% top-line jump it posted in its fiscal first quarter is the strongest increase in a year and a half. The growth rate isn't sustainable, but it shows that the initial DeepSeek headlines didn't slow Nvidia's skyrocketing trajectory.
Bears can point to growing competition in AI chips and Chinese trade restrictions. Nvidia just had its first major debt offering in five years. Demand is outpacing the uptick in competitors and trade restrictions. Betting against Nvidia could be a mistake here, especially with Nvidia shares at their cheapest level in years.
It all adds up The chart is interesting. The purple line is Nvidia's stock, which has had a stellar run as a market leader, more than tripling over the past three years. The blue line is Nvidia's earnings multiple for the current fiscal year. You see it drop come late January, when the baton is passed to the next fiscal year, but notice how hype exceeded reality in 2024 (Nvidia's fiscal 2025) before normalizing a year later and outright reversing this year. The orange line -- looking out to bottom-line forecasts for the following fiscal year -- is understandably a year ahead of that swing in valuation momentum.
Saying that Nvidia is trading for just 16 times next year's Wall Street profit target means that it's cheaper than the S&P 500 itself. Should Nvidia really be trading at a discount to the market when it's growing considerably faster? Nvidia's growth will decelerate at this point, and margins may contract as rivals improve their hardware alternatives.
The problem -- and your opportunity -- is that this is the same bear case that has been debunked in recent quarters. Nvidia keeps getting stronger, and analyst profit estimates keep rising. In short, by the end of the next fiscal year, there's a fair chance that Nvidia stock's snapshot today was trading for a lot less than 16 times next year's earnings.
The AI trade has been built on a powerful assumption: AI won’t just supercharge Big Tech earnings — it will eventually lift profitability across the entire economy.
The problem, according to Apollo chief economist Torsten Slok, is that the second half of that equation isn’t showing up yet.
NVDA stock is moving. See the chart and price action here. "So far there are no signs of profit margins rising outside the tech sector. This is ultimately what we are waiting for, because the value of AI companies today rests entirely on the promise that margins in the S&P 493 will eventually climb," Slok said.
S&P 493 Is the Real TestThe "S&P 493" — the index excluding the Magnificent Seven — is where the real test lies.
This gap is a valuation risk.
AI leaders are being priced as if broad-based productivity gains are imminent, with markets effectively pulling forward years of expected earnings growth. But if adoption cycles and ROI timelines stretch longer than expected, those assumptions could prove premature.
"This creates a dangerous divergence between aggressive, front-loaded valuations today and a much slower cash flow reality, since equity markets priced for instant earnings growth will face a painful repricing if the productivity hockey-stick takes five years rather than five months," Slok warned.
In other words, the market is betting on speed — and the economy may be moving at a different pace.
ROI Delays Are the RiskThe mismatch is critical. Enterprise AI adoption requires major upfront investment, workflow redesign and time before efficiency gains begin to show up in margins.
If those gains take years to materialize, rather than quarters, the current premium baked into AI-exposed names could come under pressure.
"The bottom line is that a mismatch between current earnings expectations and the actual time firms need to generate ROI on AI investments could have significant implications for many AI company valuations today," Slok said.
Investors know AI works for enterprise — they are asking about when it pays. And right now, the broader market is not confirming the timeline priced into high-flying AI stocks.
Photo: M-SUR / Shutterstock
This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Market News and Data brought to you by Benzinga APIs
Two stocks, one question: should a retirement-focused investor own NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) or Sherwin-Williams (NYSE:SHW) right now? The setup is genuinely strange. NVIDIA, the company sitting at the center of the AI capital-spending supercycle, trades at a lower price-to-earnings multiple than the company that sells the paint on your neighbor’s siding. It is a genuine valuation quirk worth dissecting, because the answer for retirees requires looking beyond the headline P/E ratios.
Dimension 1: Valuation, Where the Paradox Lives On the numbers, NVIDIA is objectively cheaper. Shares trade at a trailing P/E of 30 and a forward P/E of 22, against TTM EPS of $6.53. Sherwin-Williams, by contrast, trades at a trailing P/E of 34 and a forward P/E of 30, on TTM EPS of $10.20. Both trailing and forward, the semiconductor giant is priced below the paint maker.
The compression came despite a rising share price. Shares are up 27.74% over the past year. The multiple compressed because earnings ran faster than the share price. Sherwin-Williams shares, meanwhile, are down 3.56% over the same year, and yet the multiple has not budged much because investors keep paying up for defensive earnings. Winner: NVDA. On pure valuation math, you are paying less per dollar of profit for the faster-growing business.
Dimension 2: Growth Trajectory The gap here is not close. NVIDIA posted quarterly earnings growth of roughly 214% year over year and revenue growth of roughly 85%, powered by Data Center revenue of $75.246 billion, up 92% YoY. CEO Jensen Huang described it as “the buildout of AI factories, the largest infrastructure expansion in human history.”
Sherwin-Williams grew quarterly earnings 7.5% and revenue 6.8%, and management guided full-year 2026 adjusted EPS to $11.50 to $11.90, a midpoint growth rate of 2.4%. CEO Heidi Petz has repeatedly described the environment as “softer-for-longer”. Winner: NVDA, decisively. This is triple-digit growth against low-single-digit growth. It is not a fair fight.
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Dimension 3: Income and Stability Now the picture inverts. Sherwin-Williams yields 0.91% on a forward annualized dividend of $3.20, and it just extended a streak of 47 consecutive years of dividend increases. Its beta is 1.1, roughly in line with the market. NVIDIA, after raising its quarterly payout from $0.01 to $0.25, yields .50%, with a beta of 2.211, meaning shares tend to swing more than twice as violently as the index. (For income-first readers, our Paycheck Portfolio report on 10 Dividend Kings is a useful companion to this discussion.)
Sherwin-Williams also sells into thousands of small contractors and repaint jobs, a demand base that softens but rarely evaporates. NVIDIA’s fortunes are tied to a hyperscaler capex cycle and $119.0 billion in supply commitments that assume the buildout keeps compounding. Winner: SHW, decisively.
The Verdict For a retirement-focused investor, Sherwin-Williams probably still wins, but the race is tightening. The paint maker is more expensive per dollar of earnings for a reason: a 47-year dividend increase streak, a beta near the market, and end markets that muddle through recessions rather than crater. Analysts carry a price target of $378.90 on SHW versus a current quote of $330.57, and the income compounds whether AI capex accelerates or not.
NVIDIA is the better business and, remarkably, the cheaper stock on both trailing and forward earnings, with an analyst target of $301.62. But retirees draw income from dividends and from capital they cannot afford to see cut in half, rather than from earnings growth. A beta above 2 and a sub-1% yield disqualify NVIDIA as a core retirement holding, however cheap the multiple looks. Put NVIDIA in a growth sleeve. Put Sherwin-Williams in the anchor position.
Don't wait: the analyst who called NVIDIA in 2010 just revealed his top 10 AI stocks. See the full list FREE now.
Apple, a global technology giant, now trades just 1% off its record high. (Spencer Platt/Getty Images)
With the Nasdaq trading just 5% below its recent 52-week high, the Roundhill Magnificent Seven ETF remains a relative laggard, sitting roughly 8% beneath the record high it reached on May 14.
A consortium of Tier 1 U.S. lenders is exploring a $15 billion acquisition of the STAR debit network to bypass federal fee caps and circumvent legacy interchange fees. As traditional credit networks face compounding headwinds from capped merchant settlements and the adoption of decentralized payments, this potential regulatory arbitrage poses a severe structural threat to the payment processing duopoly.
The physical economy is undergoing a profound structural shift in how capital flows from consumers to merchants. For years, the payment processing space operated as an entrenched duopoly, extracting tolls on global transaction volume. Major financial institutions are signaling a refusal to continue paying those tolls. The proposed mega-bank consortium represents a calculated maneuver to internalize network revenues, threatening the margins of legacy payment processors while offering a lifeline to a distressed financial technology provider.
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The Blueprint to Starve the MiddlemanUnderstanding the gravity of this potential acquisition requires looking at the Durbin Amendment. This key provision of the Dodd-Frank Wall Street Reform and Consumer Protection Act strictly caps the interchange fees that banks with over $10 billion in assets can charge merchants for processing debit card transactions. A structural loophole exists for institutions that own and operate the underlying payment network.
Fiserv Today
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52-Week Range$47.04▼
$171.07P/E Ratio8.71
Price Target$77.33
By acquiring the STAR and Accel networks from Fiserv, Inc. NASDAQ: FISV, a consortium consisting of JPMorgan Chase & Co. NYSE: JPM, Bank of America Corporation NYSE: BAC, Wells Fargo & Company NYSE: WFC, and The PNC Financial Services Group, Inc. NYSE: PNC could build a decentralized, vertically integrated payment rail.
Capital One Financial Corporation NYSE: COF successfully validated this blueprint during the $50.6 billion acquisition of Discover Financial Services. By owning the Pulse network, Capital One bypassed third-party routing fees.
The STAR network already routes transactions for more than 115 million cardholders across the United States. Shifting that transaction volume onto bank-owned infrastructure immediately increases lenders' operating margins by eliminating middlemen. Owning the rails transforms an expense into a revenue center.
Swapping a Debit Network for a $15B LifelineWhy is Fiserv entertaining the divestiture of a core infrastructure asset? The answer lies in deep valuation compression and severe operational friction at the executive level. Shares of Fiserv are navigating a brutal structural drawdown, having fallen approximately 70% from 2025 highs and about 25% year-to-date.
Fiserv changes hands at a distressed trailing price-to-earnings ratio of 8.58. For a mature technology provider generating consistent cash flow, a single-digit earnings multiple signals profound institutional skepticism regarding future growth.
Much of this skepticism stems from C-suite volatility. Fiserv is turning over executives at an alarming rate. President Dhivya Suryadevara resigned on July 7, invoking a severance clause less than a year into her tenure. This departure arrived just weeks after Takis Georgakopoulos stepped in as chief executive officer, replacing Mike Lyons, who abruptly departed for Truist Financial Corporation NYSE: TFC. Two leadership changes within 30 days indicate deep internal misalignment and pose significant operational risk.
Divesting the debit networks for an estimated $15 billion would provide Fiserv with an unprecedented liquidity injection. Monetizing these legacy rails allows the newly installed management team to refocus capital exclusively on high-growth assets, specifically the Clover point-of-sale ecosystem.
Clover is Fiserv's primary growth engine, competing directly with Block NYSE: XYZ and Toast NYSE: TOST in the highly lucrative merchant-acquiring space. Analyst models currently peg Fiserv's fair value near $78, representing roughly 54% upside from current trading levels near $51. A $15 billion cash infusion entirely offsets the operational risks of executive turnover, forcing the broader market to reprice Fiserv based on a fortified balance sheet rather than leadership uncertainty.
Death by 1000 Cuts for the Legacy DuopolyWhile Fiserv stands to gain transformative liquidity, Visa Inc. NYSE: V and Mastercard Incorporated NYSE: MA are facing a multi-front assault on fundamental business models.
In June 2026, Visa and Mastercard received preliminary approval for a historic $38 billion interchange settlement following years of antitrust litigation. The terms are brutal for long-term margin expansion. The settlement mandates a 10-basis-point cut to credit card swipe fees over five years and caps those rates at 1.25% for eight years. Merchant lobbying groups successfully weaponized antitrust sentiment to compress the exact fees that justify Visa's premium 31x trailing price-to-earnings multiple.
Beyond traditional regulatory friction, alternative routing technology is actively cannibalizing market share. The July 2026 launch of the Open USD consortium signals a rapid acceleration in institutional adoption of stablecoins. Blockchain-based transaction routing bypasses traditional card networks entirely, forcing legacy processors to operate in lower-margin infrastructure roles rather than serving as primary toll operators.
The combination of capped merchant fees, alternative stablecoin routing, and a $15 billion bank-led debit coup explains why Visa shares contracted more than 10% over the trailing four-week period. Mastercard is exhibiting sympathy weakness, declining steadily as broader structural routing concerns permeate the market.
Front-Running the Reorganization of Digital PlumbingWall Street is attempting to price in this structural shift via a classic pairs trade: going long the infrastructure provider and shorting the legacy processors. Digging into the underlying fundamentals and options data provides a clear picture of how institutional money is managing the risk.
Derivatives data reveal highly calculated institutional positioning. Options flow shows heavy open interest accumulating in $60 call contracts for Fiserv, signaling expectations of a completed asset sale. Aggressive hedging is underway alongside those bullish bets, as evidenced by a 266% surge in $55 put volume.
Markets recognize that a consortium-led acquisition of this magnitude will face intense antitrust scrutiny. Merchant advocacy groups will actively lobby the federal government to block any transaction that allows mega-banks to sidestep Durbin Amendment fee caps.
The payment sector is preparing for a defining volatility event as the physical economy reorganizes digital plumbing. Investors assessing exposure to financial technology and payment rails might add Visa to a watchlist ahead of the July 28 earnings report, which will provide the next definitive look into transaction volume stability and the true impact of ongoing margin compression.
Should You Invest $1,000 in Fiserv Right Now?Before you consider Fiserv, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Fiserv wasn't on the list.
While Fiserv currently has a Hold rating among analysts, top-rated analysts believe these five stocks are better buys.
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MarketBeat just released its list of the 7 hottest IPOs expected to hit Wall Street in 2026. See which companies are preparing to go public and why investors are watching closely.
Wall Street analysts forecast that Bank of America (BAC - Free Report) will report quarterly earnings of $1.13 per share in its upcoming release, pointing to a year-over-year increase of 27%. It is anticipated that revenues will amount to $30.62 billion, exhibiting an increase of 15.7% compared to the year-ago quarter.
Over the last 30 days, there has been an upward revision of 1.6% in the consensus EPS estimate for the quarter, leading to its current level. This signifies the covering analysts' collective reconsideration of their initial forecasts over the course of this timeframe.
Prior to a company's earnings announcement, it is crucial to consider revisions to earnings estimates. This serves as a significant indicator for predicting potential investor actions regarding the stock. Empirical research has consistently demonstrated a robust correlation between trends in earnings estimate revision and the short-term price performance of a stock.
While investors typically rely on consensus earnings and revenue estimates to gauge how the business may have fared during the quarter, examining analysts' projections for some of the company's key metrics often helps gain a deeper insight.
That said, let's delve into the average estimates of some Bank of America metrics that Wall Street analysts commonly model and monitor.
According to the collective judgment of analysts, 'Efficiency Ratio (FTE basis)' should come in at 59.8%. The estimate compares to the year-ago value of 64.6%.
Analysts forecast 'Total earning assets - Average balance' to reach $3121.38 billion. The estimate compares to the year-ago value of $3050.21 billion.
The combined assessment of analysts suggests that 'Book value per share of common stock' will likely reach $39.22 . Compared to the present estimate, the company reported $37.13 in the same quarter last year.
The collective assessment of analysts points to an estimated 'Total nonperforming loans and leases' of $6.68 billion. Compared to the current estimate, the company reported $5.98 billion in the same quarter of the previous year.
It is projected by analysts that the 'Tier 1 Capital Ratio' will reach 12.5%. Compared to the present estimate, the company reported 12.8% in the same quarter last year.
The consensus among analysts is that 'Total nonperforming loans, leases and foreclosed properties' will reach $6.78 billion. Compared to the present estimate, the company reported $6.10 billion in the same quarter last year.
Based on the collective assessment of analysts, 'Tier 1 Leverage Ratio' should arrive at 6.5%. Compared to the present estimate, the company reported 6.7% in the same quarter last year.
The consensus estimate for 'Net Interest Income- Fully taxable-equivalent basis' stands at $16.24 billion. Compared to the present estimate, the company reported $14.82 billion in the same quarter last year.
Analysts' assessment points toward 'Total Noninterest Income' reaching $14.76 billion. Compared to the present estimate, the company reported $11.79 billion in the same quarter last year.
Analysts expect 'Investment and brokerage services' to come in at $5.47 billion. The estimate compares to the year-ago value of $4.78 billion.
The average prediction of analysts places 'Investment banking fees' at $1.96 billion. Compared to the current estimate, the company reported $1.43 billion in the same quarter of the previous year.
Analysts predict that the 'Total fees and commissions' will reach $10.73 billion. Compared to the current estimate, the company reported $9.47 billion in the same quarter of the previous year.
View all Key Company Metrics for Bank of America here>>>
Over the past month, Bank of America shares have recorded returns of +6.9% versus the Zacks S&P 500 composite's +1.1% change. Based on its Zacks Rank #3 (Hold), BAC will likely exhibit a performance that aligns with the overall market in the upcoming period. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .
Wall Street analysts forecast that JPMorgan Chase & Co. (JPM - Free Report) will report quarterly earnings of $5.52 per share in its upcoming release, pointing to a year-over-year increase of 11.3%. It is anticipated that revenues will amount to $48.71 billion, exhibiting an increase of 8.4% compared to the year-ago quarter.
The consensus EPS estimate for the quarter has undergone an upward revision of 1.3% in the past 30 days, bringing it to its present level. This represents how the covering analysts, as a whole, have reassessed their initial estimates during this timeframe.
Prior to a company's earnings release, it is of utmost importance to factor in any revisions made to the earnings projections. These revisions serve as a critical gauge for predicting potential investor behaviors with respect to the stock. Empirical studies consistently reveal a strong link between trends in earnings estimate revisions and the short-term price performance of a stock.
While it's common for investors to rely on consensus earnings and revenue estimates for assessing how the business may have performed during the quarter, exploring analysts' forecasts for key metrics can yield valuable insights.
In light of this perspective, let's dive into the average estimates of certain JPMorgan Chase & Co. metrics that are commonly tracked and forecasted by Wall Street analysts.
According to the collective judgment of analysts, 'Book value per share' should come in at $130.61 . Compared to the present estimate, the company reported $122.51 in the same quarter last year.
The collective assessment of analysts points to an estimated 'Total Interest Earning Assets - Average Balance' of $4183.30 billion. Compared to the current estimate, the company reported $3845.98 billion in the same quarter of the previous year.
The combined assessment of analysts suggests that 'Total Non-Performing Assets' will likely reach $11.42 billion. The estimate is in contrast to the year-ago figure of $10.48 billion.
The consensus estimate for 'Total Non-Performing Loans' stands at $10.50 billion. The estimate compares to the year-ago value of $9.82 billion.
It is projected by analysts that the 'Tier 1 Capital Ratio' will reach 15.0%. The estimate is in contrast to the year-ago figure of 16.1%.
Analysts forecast 'Net Interest Income (FTE)' to reach $25.68 billion. The estimate compares to the year-ago value of $23.31 billion.
Analysts' assessment points toward 'Noninterest revenue- Investment banking fees' reaching $2.86 billion. The estimate is in contrast to the year-ago figure of $2.50 billion.
The consensus among analysts is that 'Noninterest revenue- Principal transactions' will reach $7.00 billion. The estimate compares to the year-ago value of $7.15 billion.
Based on the collective assessment of analysts, 'Total Noninterest revenue' should arrive at $23.76 billion. Compared to the present estimate, the company reported $21.70 billion in the same quarter last year.
The average prediction of analysts places 'Net Interest Income' at $25.61 billion. The estimate compares to the year-ago value of $23.21 billion.
Analysts predict that the 'Noninterest revenue- Card income' will reach $1.29 billion. Compared to the present estimate, the company reported $1.34 billion in the same quarter last year.
Analysts expect 'Noninterest revenue- Lending- and deposit-related fees' to come in at $2.39 billion. Compared to the present estimate, the company reported $2.25 billion in the same quarter last year.
View all Key Company Metrics for JPMorgan Chase & Co. here>>>
Shares of JPMorgan Chase & Co. have demonstrated returns of +7% over the past month compared to the Zacks S&P 500 composite's +1.1% change. With a Zacks Rank #2 (Buy), JPM is expected to beat the overall market performance in the near future. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .
The Walt Disney Company (DIS 0.34%) entered a new chapter back in March when Josh D'Amaro succeeded Bob Iger as the chief executive officer of the iconic entertainment company. D'Amaro is a longtime Disney executive, and Wall Street is largely bullish on him and the company's outlook.
But the stock has struggled mightily. In 2026 alone, Disney is down more than 14% as of this writing. The entertainment giant is eager to make a comeback, and Disney will report earnings in early August. So should you buy the stock beforehand?
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There are reasons to be optimistic about the upcoming earnings report. D'Amaro comes from the theme park side and had quite a bit of success. In its latest quarter, the experiences division reported 7% year-over-year growth.
The company is also investing heavily in streaming and is approaching profitability there. Finally, the successful release of Toy Story 5 has given Disney a much-needed boost heading into the summer season. Overall, Disney expects adjusted earnings-per-share growth of 12% for fiscal 2026.
Image source: The Motley Fool.
The D'Amaro era isn't without its challenges. Disney is facing intense scrutiny and regulatory pressure from the FCC. Raymond James even cut Disney's price target recently due to increased competition from Comcast's Universal theme parks.
There's plenty of optimism surrounding Disney that simply hasn't translated into positive momentum for the stock. That could change when earnings are released in August. Disney is focused on sparking growth, and with the stock at a reasonable price right now, buying before the end of July could be advantageous for long-term investors.
Catie Hogan has positions in Walt Disney. The Motley Fool has positions in and recommends Walt Disney. The Motley Fool recommends Comcast. The Motley Fool has a disclosure policy.
While many were skeptical of the idea of a Moana live-action remake just two years after Moana 2 was released, it is still rather stunning that the film is reviewing this badly.
Moana, with dozens of reviews now in, has amassed a 37% Rotten Tomatoes score, the worst in Disney live-action adaptation history. That’s lower than at least 12 other movies, including the worst ones like Maleficent, Dumbo and Alice in Wonderland. Criticisms include its flat visuals, underwhelming performances and the fact that it simply did not need to exist at all as nearly a 1:1 remake of the original film.
Disney may need to take a beat to figure out the plan for continuing with this concept. Perhaps that not every movie they’ve ever made needs an adaptation like this, particularly not the ones that have released so recently. There is a big difference between say, Lilo and Stitch, which released 24 years ago, and Moana, featuring characters who were last seen on screen in 2024.
The biggest question, of course, is box office. While many of these movies have performed very well, some have bombed. Here are the last ten movies and their global totals:
Lilo and Stitch - $1.03 billionSnow White - $205 millionMufasa: The Lion King - $722 millionThe Little Mermaid - $569 millionCruella - $233 millionMulan - $70 millionMaleficent: Mistress of Evil - $491 millionThe Lion King - $1.6 billionAladdin - $1.05 billionDumbo - $353 millionYou may say that Moana, given the love for the original, is destined to be a smash despite these scores and a $250 million budget, but that’s become questionable. The most recent projections are that it may earn $60 to $65 million its opening weekend, or even as low as $40 million, a figure deemed “catastrophic” by some. In contrast, the Lilo and Stitch megahit opening weekend grossed $146 million. Doing half or even a third of that, if that extended to the global box office total, would be disastrous.
Disney is already pressing forward with new adaptations, the nearest being a live-action Tangled out in 2027. In the works are Lilo and Stitch 2, Hercules, Maleficent 3, The Aristocats and Cruella 2. There are some rather obvious big omissions right now. That would include The Princess and the Frog, Pocahontas, Tarzan, The Hunchback of Notre Dame, Big Hero 6, Encanto, Raya and the Last Dragon, Brave, Frozen 1 and 2 and smaller ones from there. Exactly zero of those sound exciting or necessary. There is absolutely no way that Disney will be able to resist Frozen, however, and I would predict $2 billion for that one.
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We will see how Moana does, but if it’s an enormous bomb on that big a budget, Disney may want to slow down with these and really think hard about the plans to potentially do everything over time.
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Pick up my sci-fi novels the Herokiller series and The Earthborn Trilogy.
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? Developed alongside the Zacks Rank, the Zacks Style Scores are a group of complementary indicators that help investors pick stocks with the best chances of beating the market over the next 30 days.
Each stock is given an alphabetic rating of A, B, C, D or F based on their value, growth, and momentum qualities. With this system, an A is better than a B, a B is better than a C, and so on, meaning the better the score, the better chance the stock will outperform.
The Style Scores are broken down into four categories:
Value ScoreFor value investors, it's all about finding good stocks at good prices, and discovering which companies are trading under their true value before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to help pick out the most attractive and discounted stocks.
Growth ScoreWhile good value is important, growth investors are more focused on a company's financial strength and health, and its future outlook. The Growth Style Score takes projected and historic earnings, sales, and cash flow into account to uncover stocks that will see long-term, sustainable growth.
Momentum ScoreMomentum trading is all about taking advantage of upward or downward trends in a stock's price or earnings outlook, and these investors live by the saying "the trend is your friend." The Momentum Style Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.
VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank The Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.
#1 (Strong Buy) stocks have produced an unmatched +23.94% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.
With more than 800 top-rated stocks to choose from, it can certainly feel overwhelming to pick the ones that are right for you and your investing journey.
That's where the Style Scores come in.
You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only has a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.
The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.
A stock with a #4 (Sell) or #5 (Strong Sell) rating, for instance, even one with Scores of A and B, will still have a declining earnings forecast, and a greater chance its share price will fall too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Ford Motor Company (F - Free Report) Dearborn, MI-based Ford is one of the leading automakers in the world. It manufactures, markets and services cars, trucks, sport utility vehicles, electrified vehicles and Lincoln luxury vehicles.
F 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 8.24; value investors should take notice.
Two analysts revised their earnings estimate higher in the last 60 days for fiscal 2026, while the Zacks Consensus Estimate has increased $0.04 to $1.64 per share. F also boasts an average earnings surprise of +58.4%.
With a solid Zacks Rank and top-tier Value and VGM Style Scores, F should be on investors' short list.
General Motors (GM +0.31%) is not having an easy time selling electric vehicles (EVs) in the U.S. Once again, second-quarter U.S. sales were dragged down by EVs, with the company posting a 4.2% drop to just under 715,000 vehicles. As federal incentives fall by the wayside and demand for EVs hits a wall domestically, GM is focusing on other aspects of the business to pick up the slack.
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GM has one newer revenue engine that could have an outsize impact on the company's financials. Recently, the automaker pivoted into energy storage. Energy storage demand is exploding around the country as AI data centers continue to put immense pressure on the grid. GM can easily pivot many of its existing assets into this initiative.
Image source: The Motley Fool.
The energy storage market is expanding rapidly, making this a smart move for GM. The total addressable market could reach at least $250 billion by the early 2030s, according to research.
GM's EVs may be struggling, but it's also still the top-selling automaker of SUVs and trucks. The strong traditional combustion-engine business, combined with the pivot into energy, makes GM a compelling buy for long-term investors as the stock is relatively inexpensive right now.
The automaker's energy strategy won't be a short-term win. Investors will need patience and a longer time horizon to really see the fruits of the endeavor. GM's stock is down more than 5% in 2026, and its forward P/E ratio is in the single digits, so for those bullish on sustained energy demand through the next decade, now could be the right time to buy and hold General Motors stock.
Catie Hogan has no position in any of the stocks mentioned. The Motley Fool recommends General Motors. The Motley Fool has a disclosure policy.
The market expects GE Aerospace (GE - Free Report) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended June 2026. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates.
The earnings report, which is expected to be released on July 16, might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower.
While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise.
Zacks Consensus EstimateThis industrial conglomerate is expected to post quarterly earnings of $1.86 per share in its upcoming report, which represents a year-over-year change of +12.1%.
Revenues are expected to be $11.86 billion, up 16.8% from the year-ago quarter.
Estimate Revisions TrendThe consensus EPS estimate for the quarter has remained unchanged over the last 30 days. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period.
Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts.
Price, Consensus and EPS Surprise
Earnings WhisperEstimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. Our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction) -- has this insight at its core.
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.
Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only.
A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP.
Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell).
How Have the Numbers Shaped Up for GE?For GE, the Most Accurate Estimate is higher than the Zacks Consensus Estimate, suggesting that analysts have recently become bullish on the company's earnings prospects. This has resulted in an Earnings ESP of +2.79%.
On the other hand, the stock currently carries a Zacks Rank of #2.
So, this combination indicates that GE will most likely 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 GE would post earnings of $1.61 per share when it actually produced earnings of $1.86, delivering a surprise of +15.53%.
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.
GE appears 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 PlayerGE Aerospace (GE - Free Report) , another stock in the Zacks Aerospace - Defense industry, is expected to report earnings per share of $1.86 for the quarter ended June 2026. This estimate points to a year-over-year change of +12.1%. Revenues for the quarter are expected to be $11.86 billion, up 16.8% from the year-ago quarter.
The consensus EPS estimate for GE has remained unchanged over the last 30 days. However, a higher Most Accurate Estimate has resulted in an Earnings ESP of +2.79%.
This Earnings ESP, combined with its Zacks Rank #2 (Buy), suggests that GE will most likely beat the consensus EPS estimate. The company beat consensus EPS estimates in each of the trailing four quarters.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
In its upcoming report, Goldman Sachs (GS - Free Report) is predicted by Wall Street analysts to post quarterly earnings of $14.47 per share, reflecting an increase of 32.6% compared to the same period last year. Revenues are forecasted to be $16.49 billion, representing a year-over-year increase of 13.1%.
Over the past 30 days, the consensus EPS estimate for the quarter has been adjusted upward by 3.5% to its current level. This demonstrates the covering analysts' collective reassessment of their initial projections during this period.
Ahead of a company's earnings disclosure, it is crucial to give due consideration to changes in earnings estimates. These revisions serve as a noteworthy factor in predicting potential investor reactions to the stock. Numerous empirical studies consistently demonstrate a strong relationship between trends in earnings estimate revision and the short-term price performance of a stock.
While investors usually depend on consensus earnings and revenue estimates to assess the business performance for the quarter, delving into analysts' forecasts for certain key metrics often provides a more comprehensive understanding.
Bearing this in mind, let's now explore the average estimates of specific Goldman metrics that are commonly monitored and projected by Wall Street analysts.
It is projected by analysts that the 'Net Revenues- Platform Solutions- Total' will reach $251.13 million. The estimate indicates a change of -63.3% from the prior-year quarter.
According to the collective judgment of analysts, 'Net Revenues- Global Banking & Markets- Equities' should come in at $5.26 billion. The estimate suggests a change of +22.3% year over year.
The combined assessment of analysts suggests that 'Net Revenues- Global Banking & Markets- Other' will likely reach $142.50 million. The estimate points to a change of -11.5% from the year-ago quarter.
Analysts expect 'Net Revenues- Global Banking & Markets- Investment banking fees' to come in at $2.90 billion. The estimate suggests a change of +32.3% year over year.
Analysts forecast 'Net Revenues- Global Banking & Markets- Total' to reach $12.11 billion. The estimate indicates a year-over-year change of +19.6%.
Based on the collective assessment of analysts, 'Net Revenues- Asset & Wealth Management- Private banking and lending' should arrive at $638.94 million. The estimate points to a change of -19% from the year-ago quarter.
The average prediction of analysts places 'Net Revenues- Global Banking & Markets- FICC' at $3.81 billion. The estimate suggests a change of +9.8% year over year.
The consensus among analysts is that 'Net Revenues- Asset & Wealth Management- Total' will reach $4.18 billion. The estimate indicates a change of +10.7% from the prior-year quarter.
Analysts' assessment points toward 'Book Value Per Share' reaching $365.72 . The estimate compares to the year-ago value of $349.74 .
The consensus estimate for 'Assets Under Supervision (AUS) - Total' stands at $3818.46 billion. Compared to the present estimate, the company reported $3293.00 billion in the same quarter last year.
Analysts predict that the 'Standardized Capital Rules - Common equity tier 1 capital ratio' will reach 12.9%. Compared to the present estimate, the company reported 14.5% in the same quarter last year.
The collective assessment of analysts points to an estimated 'Leverage ratio' of 4.4%. The estimate is in contrast to the year-ago figure of 5.3%.
View all Key Company Metrics for Goldman here>>>
Shares of Goldman have demonstrated returns of +2.8% over the past month compared to the Zacks S&P 500 composite's +1.1% change. With a Zacks Rank #2 (Buy), GS is expected to beat the overall market performance in the near future. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .
Here at Zacks, we offer our members many different opportunities to take full advantage of the stock market, as well as how to invest in ways that lead to long-term success.
One of our most popular services, Zacks Premium offers 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 like the Earnings ESP filter. All are useful tools to find what stocks to buy, what to sell, and what are today's hottest industries.
The service also includes the Focus List, which is a long-term portfolio of top stocks that boast a winning, market-beating combination of growth and momentum qualities.
Breaking Down the Zacks Focus ListIf you could, wouldn't you jump at the chance for access to a curated list of stocks to kickstart your investing journey?
That's what the Zacks Focus List offers. It's a portfolio of 50 stocks that serve as a starting point for long-term investors to build their individual portfolios. The stocks included in the list are set to outperform the market over the next 12 months.
One thing that makes the Focus List even more advantageous is that each pick comes with a full Zacks Analyst Report. This helps explain why each stock was selected and why we believe it's a good pick for the long-term.
The portfolio's past performance only solidifies why investors should consider it as a starting point. For 2020, the Focus List gained 13.85% on an annualized basis compared to the S&P 500's return of 9.38%. Cumulatively, the portfolio has returned 2,519.23% while the S&P returned 854.95%. Returns are for the period of February 1, 1996 to March 31, 2021.
Focus List MethodologyWhen stocks are picked for the Focus List, it reflects our enduring reliance on the power of earnings estimate revisions.
Earnings estimates are expectations of growth and profitability, and are determined by brokerage analysts. Together with company management, these analysts examine every aspect that may affect future earnings, like interest rates, the economy, and sector and industry optimism.
Investors also need to look at what a company will earn down the road. This is why earnings estimate revisions are so important.
When a stock receives upward earnings estimate revisions, it will likely get even more positive changes in the future. For instance, if an analyst raised their earnings outlook last month, they'll probably do so again this month, and other analysts will follow.
Utilizing the power of earnings estimate revisions is when the Zacks Rank joins the party. A unique, proprietary stock-rating model, the Zacks Rank uses changes to quarterly earnings expectations to help investors create a winning portfolio.
Four primary factors make up the Zacks Rank: Agreement, Magnitude, Upside, and Surprise. Each is given a raw score that's recalculated every night and compiled into the Rank, and with this data, stocks are then classified into five groups, ranging from "Strong Buy" to "Strong Sell."
The Focus List is comprised of stocks hand-picked from a long list of #1 (Strong Buy) or #2 (Buy) ranked companies, meaning that each new addition boasts a bullish earnings consensus among analysts.
Since stock prices respond to revisions, it can be very profitable to buy stocks with rising earnings estimates. By buying Focus List stocks, then, you're likely getting into companies whose future earnings estimates will be raised, potentially leading to price momentum.
Focus List Spotlight: Goldman Sachs (GS - Free Report) Founded in 1869, The Goldman Sachs Group, Inc. is a leading global financial holding company providing IB, securities, investment management, and consumer banking services to a diversified client base. The company is headquartered in New York, with offices in major financial centers globally.
On July 11, 2018, GS was added to the Focus List at $226.85 per share. Shares have increased 353.89% to $1 since then, and the company is a #2 (Buy) on the Zacks Rank.
Six analysts revised their earnings estimate upwards in the last 60 days for fiscal 2026. The Zacks Consensus Estimate has increased $1.36 to $60.44. GS boasts an average earnings surprise of 13.1%.
Moreover, analysts are expecting GS's earnings to grow 17.8% for the current fiscal year.
Reveal Winning StocksUnlock all of our powerful research, tools and analysis, including the Zacks #1 Rank List, Equity Research Reports, Zacks Earnings ESP Filter, Premium Screener and more, as part of Zacks Premium. You'll quickly identify which stocks to buy, hold and sell, and target today's hottest industries, to help improve the performance of your portfolio. Gain full access now >>
On Thursday, July 9, BlackRock debuted the iShares Nasdaq 100 ETF (IQQ). IQQ marks a significant inflection point in the ETF market, as BlackRock looks to challenge the tried-and-true Invesco QQQ Trust Series I (QQQ).
Key Takeaways: BlackRock has launched the iShares Nasdaq 100 ETF (IQQ), a fund that provides targeted exposure to companies within the Nasdaq-100. IQQ joins the State Street SPDR Portfolio Nasdaq 100 ETF (QNDX) as the second fund to challenge Invesco’s QQQ. QQQ continues to post strong annual results, especially after the fund announced structural adjustments at the end of 2025. As one may expect, IQQ looks to provide focused exposure to the Nasdaq-100. This index has historically offered compelling access to companies within the tech, consumer discretionary, healthcare, and industrials sectors.
“IQQ enhances our ability to offer investors access to the Nasdaq-100 with iShares ETFs — providing complementary strategies that allow them to align their portfolios with their objectives,” said Elise Terry, U.S. Head of iShares at BlackRock. “Supported by the liquidity, market quality, and scale of the iShares platform, this expanded suite gives investors the flexibility to customize their exposures and evolve portfolios over time.”
See More: Why Pure-Play Healthcare Technology Innovation Matters
Part of how IQQ aims to challenge QQQ’s long-standing dominance is through its expense ratio. IQQ usually operates with an expense ratio of 12 basis points, and is temporarily running a waiver that reduces that to 10 basis points.
Amping Up The Competition BlackRock is not the first firm to go to bat against the Q’s. Back in June, State Street also launched the State Street SPDR Portfolio Nasdaq 100 ETF (QNDX), which likewise provides distinct access to the Nasdaq-100.
See More: State Street Goes Heads Up With Qs, Launches Nasdaq 100 ETF
It’s certainly worth noting that QQQ is currently posting highly impressive results. As of June 29, 2026, the fund has a 1-year cumulative return of 33.98%.
This comes after Invesco announced a number of changes to QQQ’s structure at the end of 2025. The restructuring included shifting the format from a unit investment trust into an open-ended ETF and lowering the fund’s fee by two basis points. Consequently, long-term QQQ investors will likely stick with the strategy despite new competition.
That being said, competition can also breed innovation. Advisors and investors would be wise to keep an eye on all three ETFs in the weeks and months to come. Considering that the Nasdaq-100’s tech tilt taps into a number of favorable trends, such as artificial intelligence (AI), these funds could offer potent positions within a multitude of portfolios.
For more news, information, and analysis, visit the Equity ETF Content Hub.
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
The retirement income math often starts in the wrong place. A retiree who wants $60,000 a year might divide that figure by a portfolio yield and assume the highest yield is the most efficient path: about $1.71 million at 3.5%, $857,000 at 7%, or $500,000 at 12%. On day one, the 12% portfolio looks like the winner. Over a 20-year retirement, that can be exactly backwards.
The better question is not which portfolio produces the biggest first check. It is which income stream has the best chance to grow, preserve purchasing power, and avoid forcing retirees to spend down principal when markets or credit conditions turn.
The Three Tiers, Priced in Capital A conservative income portfolio yielding 3% to 4% covers $60,000 with roughly $1.5 million to $2 million in invested capital. The holdings are familiar: broad dividend-growth equities, regulated utilities, blue-chip consumer staples, and high-grade corporate bonds. With the 10-year Treasury near 4.4% and the FDIC national average 12-month CD around 1.7%, the conservative tier sits between cash drag and equity risk, with the distinct feature that the income stream can rise over time.
A moderate tier yielding 5% to 7% drops the capital requirement to roughly $860,000 to $1.2 million. This is the world of covered-call equity funds, equity REITs, preferred shares, and high-dividend international ETFs. The check is fatter, but dividend growth stalls and total return frequently lags the broad market.
An aggressive tier yielding 8% to 14% reaches $60,000 with as little as $430,000 to $750,000. Mortgage REITs, business development companies, leveraged option-income funds, and high-yield bond funds populate this tier. Principal erosion is common, distributions get cut in stress, and inflation grinds through what looks like a generous payout.
Why the Smaller Paycheck Usually Wins Here is the part the calculators miss. Core PCE reached an index level of 130.082 in May 2026, and the core PCE inflation rate was 3.4% from a year earlier. The 2026 Social Security COLA was 2.8%. A leveraged fund yielding 12% is not automatically an inflation hedge; if its distribution stays flat at $60,000, that income loses purchasing power each year prices rise.
Compare that to the actual histories on file. Johnson & Johnson (NYSE: JNJ) now pays $1.34 per quarter, marking its 64th consecutive year of dividend increases. Procter & Gamble (NYSE: PG) raised its quarterly dividend to $1.0885 in 2026, its 70th consecutive annual increase. McDonald’s (NYSE: MCD) now pays $1.86 per quarter, for an annualized payout of $7.44 and a forward yield near 2.8%.
The growth-skewed names look even more dramatic. Microsoft (NASDAQ: MSFT) yields about 1% today but lifted its quarterly dividend from $0.08 in 2005 to $0.91 in 2026, while its 10-year total return was roughly 725%. Visa (NYSE: V) yields about 0.8%, and its quarterly dividend reached $0.67 in 2026; its 10-year price return was closer to 356% than 392%.
NextEra Energy splits the difference: a utility profile paired with company guidance to grow the dividend roughly 10% annually through 2026, then 6% annually from year-end 2026 through 2028. That is the kind of dividend-growth arithmetic a static high-yield fund cannot match unless its underlying capital base and distribution can hold up through a full market cycle.
That does not mean every dividend-growth stock is safe, or that low yield is automatically better than high yield. It means the starting yield is only one variable. Dividend growth, payout durability, balance-sheet strength, and total return determine whether the paycheck can keep up with retirement expenses.
Better Checks Before You Pick a Tier Price your real spending, not your salary. Per-capita disposable personal income was $69,007 in May 2026 in current dollars, but household spending needs vary widely. A smaller income target shrinks every capital requirement above; a larger one raises it just as quickly.
Compare 10-year total returns, not headline yields. A 3% payout that grows 8% annually roughly doubles in nine years; a 12% payout that never grows loses purchasing power whenever inflation is positive. Pull the math before you commit.
Stress-test the aggressive tier. If a fund’s distribution leans on options premium or leverage, model what happens when volatility collapses or credit spreads widen. The yield printed today is rarely the yield you keep through a full cycle. A Paycheck That Can Keep Moving The best retirement paycheck rarely arrives fully formed. It is built over time by matching today’s income need with tomorrow’s inflation risk. High yield can have a place, but the durable retirement paycheck usually comes from income that can survive stress, grow with time, and leave enough principal intact to keep paying through the next cycle.
Contact [email protected] for any questions or corrections.
Starbucks is developing in-house systems that could replace software it buys from Big Tech companies, Bloomberg News reported Thursday (July 9).
The coffee chain is working on alternatives to a system from Microsoft that monitors inventory as well as a maintenance management tool from IBM, the report said, citing an internal presentation.
Starbucks has also been working for several years on creating a point-of-sale system that would replace Oracle Simphony, according to the report.
Starbucks declined to comment when reached by PYMNTS beyond sharing a company blog post about its approach to AI.
The moves are part of a larger shift happening in the business world.
“For two decades, buying enterprise software meant accepting a vendor’s feature set, paying per seat and hiring specialists to manage the platform,” PYMNTS reported Wednesday (July 8). “For small businesses, that model often meant paying for capabilities they never used. AI coding tools are changing that calculation.”
Five startups and small companies with staff ranging from 20 to 70 people switched from working with Salesforce and HubSpot in the last six months, turning instead to in-house applications built using AI tools from Anthropic, Lovable and Replit. These businesses reduced software costs by 40% to 80%.
Research and advisory firm Gartner found that up to $234 billion of enterprise application software spending will be exposed to agentic arbitrage by the end of 2030, or roughly 20% of all enterprise software-as-a-service spending.
“Agentic AI changes the economics of software,” George Brocklehurst, managing vice president at Gartner, said in a July 1 news release.
Retool, a low-code platform for building custom internal tools, found that 35% of enterprises have already swapped out at least one SaaS tool with a custom-built alternative, with 78% saying they intend to develop more this year.
Starbucks spends roughly $400 million per year just on software, Chief Technology Officer Anand Varadarajan told employees in an internal forum earlier this year, according to the Bloomberg report.
“There’s clear opportunities to reduce the spend in software,” Varadarajan said, per the report.
While in-house software can be cheaper for companies like Starbucks, which hopes to lower costs by $2 billion for its turnaround plan, building can lead businesses to pay more for maintenance and labor, the report said.
Setting sail in March 2027, guests will find enhanced outdoor escapes, new world-class dining, and unforgettable entertainment for a new Reflection, full of smiles.
, /PRNewswire/ -- Celebrity Cruises is reimagining one of its most beloved ships – and delivering new ways to experience the Caribbean – with the reveal of the newly modernized Celebrity Reflection. As the second Solstice Series ship to be made new again, the transformation introduces 13 new spaces including Edge Series standouts like the stunning Grand Plaza, guest-favorite venues from the revitalized Celebrity Solstice and two brand-new concepts – Orange Peel Bar & Grille and Tacos del Sol. From bow to stern, every detail reshapes how guests relax, dine, and connect across new outdoor spaces, dining experiences, and endless entertainment.
Celebrity Cruises Unveils 13 New Experiences on Celebrity Reflection, Redefining Caribbean Cruising: Celebrity Pool Club Render Sailing year-round in the Caribbean, Celebrity Reflection's itineraries from Fort Lauderdale span three- and four-night Caribbean escapes to Key West and The Bahamas, to six- and eight-night journeys visiting Aruba, Curaçao, Bonaire, Turks & Caicos, and Grand Cayman. Guests can look forward to the 2027 President's Cruise on the renewed Celebrity Reflection from May 10–14, 2027.
"Celebrity Cruises is constantly dreaming up ways to innovate and elevate what we deliver for our guests, which is what makes this fleet modernization program so much more than a refresh," said Laura Hodges Bethge, president of Celebrity Cruises. "With Celebrity Reflection, we're evolving the guest experience in meaningful ways – introducing 13 new spaces designed to help guests relax, explore, and connect in ways that feel effortless and unforgettable."
The happiest pool day yet at the reimagined Celebrity Pool Club
The Celebrity Pool Club anchors the ship's redesigned outdoor deck, blending modern design with a relaxed tropical atmosphere. Here, every detail is designed with relaxation in mind. Two dedicated bars, expanded seating, plush daybeds, and added shade, plus daily activities and poolside events make it easy for guests to spend the entire day at the water's edge. Guests will also find two new-to-fleet poolside dining experiences:
Orange Peel Bar & Grille: Orange Peel Bar & Grille anchors the poolside experience with a menu built for sun-soaked days. The venue features smashburgers and other grilled favorites alongside frozen cocktails. Guests can enjoy service whether seated nearby or relaxing poolside. Tacos del Sol: Tacos del Sol introduces a casual, open-air concept centered around bold, Mexican-inspired flavors. The venue features a build-your-own taco stand with a range of options and fresh toppings for poolside dining. Four new spaces offer entertainment for every mood
The Grand Plaza is Celebrity Reflection's most dramatic new space. The three-story, Edge Series-style venue anchors the ship's entertainment. A new, centrally located Martini Bar will feature a giant suspended chandelier that commands the room, complete with a chandelier show, as well as live performances and music from day to night.
Originally debuting on Celebrity Solstice, the 125-seat Boulevard Lounge brings all-day entertainment to Celebrity Reflection, anchored by dueling pianos and interactive programming. Guests can enjoy games, karaoke, and live performances throughout the day. Steps away from Boulevard Lounge, Boulevard Bar offers a selection of handcrafted cocktails, perfect for enjoying before or after a show.
Another favorite from Celebrity Solstice, The Parlor is an elevated sports and gaming lounge. Featuring hundreds of classic board games, billiards, and darts, The Parlor is perfect for some friendly competition or watching sports on the big screens. Guests can enjoy craft cocktails, Celebrity Cruises' award-winning whiskies, a menu of shareable bites, elevated takes on comfort-food classics, and a selection of over-the-top milkshakes.
Guests can soak up the Caribbean sun with a day in the park
The reimagined Sunset Park transforms the ship's top deck into a park-like outdoor space designed for relaxation and connection. The open-air venue features a range of activities – from meditation to lawn games, outdoor movies, and live music – all set against sweeping ocean views. New private cabanas offer shaded areas to unwind, with dedicated attendants catering to guests' every need. Sunset Park Café serves casual bistro-style dining for breakfast and lunch, while the adjacent Sunset Bar offers handcrafted cocktails throughout the day.
Bold flavors meet refined favorites at three new dining experiences
The intimate Italian restaurant Trattoria Rossa, which debuted this year on Celebrity Solstice, serves Roman cuisine. Guests can savor classic meat dishes and pastas made in-house daily, as well as dishes prepared tableside, paired with Italian-inspired cocktails and Celebrity Cruises' award-winning wine selections.
The Forbes Travel Guide-rated Fine Cut Steakhouse redefined dining on the Edge Series and now joins Celebrity Reflection. Guests will experience 30-day dry-aged steaks, fresh seafood, and the elevated service synonymous with Celebrity Cruises.
Set against panoramic ocean views, Bora brings a Mediterranean-inspired rooftop concept to Celebrity Reflection. First introduced in November 2025 on Celebrity Xcel, the venue shifts from day to night. A lively brunch features customizable cocktails, while evenings are centered on chef-led tableside dishes and shareable plates.
Ship-wide enhancements for a new Reflection that's all smiles
Guests of The Retreat, Celebrity Reflection's exclusive suite class, will enjoy an enhanced The Retreat Sundeck with an oversized hot tub, and a redesigned The Retreat Lounge. Ship-wide enhancements extend to returning venues including Café Al Bacio, Cellar Masters, Casino, Art Gallery, World Class Bar, Martini Bar, Pool Bar, Passport Bar, the Fitness Center, and Camp at Sea – alongside Luminae, exclusive to guests of The Retreat, and Blu – exclusive to AquaClass guests.
For more information and to book a sailing with Celebrity Cruises, please visit www.celebritycruises.com, call Celebrity Cruises at 1-888-751-7804, or contact a trusted travel advisor.
Editor's Note:
Media can stay current on all Celebrity Cruises news at www.celebritycruisespresscenter.com
About Celebrity Cruises
Celebrity Cruises, part of Royal Caribbean Group (NYSE: RCL), delivers an elevated premium vacation experience across their fleet of ocean and river ships traveling to over 300 destinations across more than 70 countries spanning all seven continents. Uniquely offering the intimate feel and thoughtful service of small ships, with the variety and excitement of bigger ones – guests can explore the world or get away from it for a little while. With every detail elevated beyond expectations, guests will never want to vacation any other way. An industry pioneer for more than 35 years, each Celebrity vacation offers experiences you won't find anywhere else.
Visit www.celebritycruises.com for more information, and connect with us on Instagram, Facebook or LinkedIn.
Norwegian Cruise Line (NCLH - Free Report) is one of the stocks most watched by Zacks.com visitors lately. So, it might be a good idea to review some of the factors that might affect the near-term performance of the stock.
Over the past month, shares of this cruise operator have returned +3.1%, compared to the Zacks S&P 500 composite's +1.1% change. During this period, the Zacks Leisure and Recreation Services industry, which Norwegian Cruise Line falls in, has lost 0.5%. The key question now is: What could be the stock's future direction?
While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.
Earnings Estimate RevisionsHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.
Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.
For the current quarter, Norwegian Cruise Line is expected to post earnings of $0.39 per share, indicating a change of -23.5% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
For the current fiscal year, the consensus earnings estimate of $1.7 points to a change of -19.4% from the prior year. Over the last 30 days, this estimate has changed +0.1%.
For the next fiscal year, the consensus earnings estimate of $2.02 indicates a change of +18.5% from what Norwegian Cruise Line is expected to report a year ago. Over the past month, the estimate has changed +1%.
With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for Norwegian Cruise Line.
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Revenue Growth ForecastWhile earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth.
In the case of Norwegian Cruise Line, the consensus sales estimate of $2.62 billion for the current quarter points to a year-over-year change of +4.2%. The $10.14 billion and $10.82 billion estimates for the current and next fiscal years indicate changes of +3.2% and +6.7%, respectively.
Last Reported Results and Surprise HistoryNorwegian Cruise Line reported revenues of $2.33 billion in the last reported quarter, representing a year-over-year change of +9.6%. EPS of $0.23 for the same period compares with $0.07 a year ago.
Compared to the Zacks Consensus Estimate of $2.34 billion, the reported revenues represent a surprise of -0.5%. The EPS surprise was +53.33%.
Over the last four quarters, Norwegian Cruise Line surpassed consensus EPS estimates two times. The company topped consensus revenue estimates times over this period.
ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.
Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Norwegian Cruise Line is graded A on this front, indicating that it is trading at a discount to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Norwegian Cruise Line. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.
For new and old investors, taking full advantage of the stock market and investing with confidence are common goals. Zacks Premium provides lots of different ways to do both.
Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor.
Zacks Premium includes access to the Zacks Style Scores as well.
What are the Zacks Style Scores? Developed alongside the Zacks Rank, the Zacks Style Scores are a group of complementary indicators that help investors pick stocks with the best chances of beating the market over the next 30 days.
Each stock is assigned a rating of A, B, C, D, or F based on their value, growth, and momentum characteristics. Just like in school, an A is better than a B, a B is better than a C, and so on -- that means the better the score, the better chance the stock will outperform.
The Style Scores are broken down into four categories:
Value ScoreValue investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.
Growth 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 ScoreWhat if you like to use all three types of investing? The VGM Score is a combination of all Style Scores, making it one of the most comprehensive indicators to use with the Zacks Rank. It rates each stock on their combined weighted styles, which helps narrow down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank The Zacks Rank is a proprietary stock-rating model that harnesses the power of earnings estimate revisions, or changes to a company's earnings expectations, to help investors build a successful portfolio.
#1 (Strong Buy) stocks have produced an unmatched +23.94% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.
But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.
That's where the Style Scores come in.
To 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.
The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.
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: Hewlett Packard Enterprise (HPE - Free Report) Headquartered in Spring, TX, Hewlett Packard Enterprise Company was formed as a result of the split of Hewlett-Packard Company into two separate entities – one focusing on the enterprise-facing hardware and service business and the other focusing on the consumer-facing computer and printer segments.
HPE is a #1 (Strong Buy) on the Zacks Rank, with a VGM Score of B.
Additionally, the company could be a top pick for growth investors. HPE has a Growth Style Score of B, forecasting year-over-year earnings growth of 75.8% for the current fiscal year.
For fiscal 2026, eight analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $1.00 to $3.41 per share. HPE boasts an average earnings surprise of +16%.
With a solid Zacks Rank and top-tier Growth and VGM Style Scores, HPE should be on investors' short list.
PepsiCo Inc (NASDAQ:PEP, XETRA:PEP) shares fell about 4% on Thursday after the food and beverage company reported fiscal second-quarter adjusted earnings that came in slightly below Wall Street expectations, despite revenue topping estimates and the company reaffirming its full-year outlook.
PepsiCo reported adjusted earnings per share of $2.20, compared with analysts' consensus estimate of $2.21.
Net revenue rose 6.4% year over year to $24.18 billion, exceeding expectations of $23.95 billion.
The company said second quarter revenue growth was driven by effective net pricing, organic volume growth, foreign exchange benefits and acquisitions.
International operations continued to support overall performance, with each international segment posting strong net revenue growth. PepsiCo said Asia Pacific Foods, International Beverages Franchise, and Europe, Middle East and Africa benefited from organic volume growth, while Latin America Foods showed sequential improvement in organic volume trends.
In North America, the convenient foods business gained volume market share through innovation and affordability initiatives, although net revenue declined, primarily reflecting lower effective net pricing. The beverages business posted strong net revenue growth, supported by acquisitions completed in 2025 and organic growth.
"Our second quarter results featured strong organic volume and net revenue growth for the global convenient foods and global beverages businesses,” PepsiCo CEO Ramon Laguarta said.
“Year-to-date, PepsiCo's global organic volume has increased at the highest rate since 2022 - aided by the strength of the international business and the continued evolution of the portfolio to offer more choices through portion control varieties, diverse ingredients, functional benefits such as hydration, protein and fiber, energy and zero sugar beverage varieties.”
The company reaffirmed its fiscal 2026 guidance, continuing to expect organic revenue growth of between 2% and 4% and core constant currency EPS growth of between 4% and 6%.
It also maintained its forecast for approximately $8.9 billion in total cash returns to shareholders, including $7.9 billion in dividends and $1.0 billion in share repurchases.
There's a rift between the two best-known carbonated beverage brands. PepsiCo (PEP 3.39%) is relatively out of favor. The beverage and salty snacks giant is trading 17% below its 52-week high and 28% lower than when shares peaked in early 2023.
Rival Coca-Cola is faring considerably better. Coca-Cola hit new highs this week. PepsiCo may be a laggard right now, but don't dismiss it as a potential winning investment. There are a few good reasons to take a chance on PepsiCo this month. Let's check them out.
Image source: Getty Images.
1. PepsiCo's yield is approaching a new high Pepsi stock's recent slide -- and its long streak of boosting its annual distributions -- has the shares trading at a 4.2% yield. It's closing in on last year's historic high. More downticks or another hike in the spring of next year should get it there.
May's 4% increase in its quarterly payouts extends PepsiCo's streak of annual hikes to 54 consecutive years. PepsiCo is royalty, as one of the country's 57 Dividend Kings with more than 50 years of increased distributions. It's one of just six Dividend Kings that are currently yielding more than 4%.
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2. The stock is cheap in a pricey market PepsiCo's guidance calls for meager but positive revenue growth this year, with earnings growing slightly higher. The company behind more than just its namesake soft drinks -- it's also the owner of Frito-Lay, Gatorade, and Quaker Oats -- trades at a discount to the market.
You can buy PepsiCo for just 16 times forward earnings. The beverage stock itself is growing much more slowly than that, but you should expect to pay a premium to collect a yield above 4% in today's market. That current payout is higher than even the top money market funds.
3. Taking a closer look at fresh financials PepsiCo released its latest financial results on Thursday morning. Its fiscal second quarter ended in mid-June, giving the beverage and food conglomerate the distinction of being one of the earliest reporters this critical earnings season. Its performance was a mixed bag.
The reported results seem great at first. Net revenue rose 6.4% for the quarter. Earnings per share more than doubled. Take it a step further, and organic revenue rose 2.4%. Core earnings per share climbed 4%, or just 1% on a constant currency basis. It was a slight beat on the top and a slight miss on the bottom. The stock initially ticked slightly lower ahead of the market open.
A silver lining is that its global organic sales volume through the first half of fiscal 2026 is PepsiCo's highest in four years. It's also not taking its recovery for granted, actively working on "restaging" its four main non-soda brands: Lays, Tostitos, Gatorade, and Quaker. The tweaks involve updating and upgrading the packaging, marketing, and even ingredients to appeal to a wider audience. It's a gamble, but one worth taking to accelerate its slumbering organic and core results. With more than five decades of dividend hikes, investors will continue to be rewarded for their patience in the turnaround process.
For the quarter ended June 2026, PepsiCo (PEP - Free Report) reported revenue of $24.18 billion, up 6.4% over the same period last year. EPS came in at $2.20, compared to $2.12 in the year-ago quarter.
The reported revenue represents a surprise of +1.32% over the Zacks Consensus Estimate of $23.87 billion. With the consensus EPS estimate being $2.19, the EPS surprise was +0.46%.
While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health.
Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance.
Here is how PepsiCo performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:
Reported Net Revenue, GAAP measure- IB Franchise (International Beverages Franchise): $1.52 billion versus $1.46 billion estimated by four analysts on average. Compared to the year-ago quarter, this number represents a +11.3% change.Reported Net Revenue, GAAP measure- EMEA (Europe, Middle East and Africa): $4.98 billion versus $4.85 billion estimated by four analysts on average. Compared to the year-ago quarter, this number represents a +9.9% change.Reported Net Revenue, GAAP measure- PBNA (PepsiCo Beverages North America): $7.24 billion versus the four-analyst average estimate of $7.16 billion. The reported number represents a year-over-year change of +6.6%.Reported Net Revenue, GAAP measure- PFNA (PepsiCo Foods North America): $6.37 billion compared to the $6.54 billion average estimate based on four analysts. The reported number represents a change of -1.7% year over year.Reported Net Revenue, GAAP measure- LatAm Foods: $2.94 billion compared to the $2.83 billion average estimate based on four analysts. The reported number represents a change of +15.4% year over year.Reported Net Revenue, GAAP measure- Asia Pacific Foods: $1.12 billion versus the four-analyst average estimate of $1.07 billion. The reported number represents a year-over-year change of +12.2%.Core Operating Profit, non-GAAP measure- PFNA (PepsiCo Foods North America): $1.37 billion versus the four-analyst average estimate of $1.57 billion.Core Operating Profit, non-GAAP measure- PBNA (PepsiCo Beverages North America): $992 million compared to the $1.07 billion average estimate based on four analysts.Core Operating Profit, non-GAAP measure- IB Franchise (International Beverages Franchise): $638 million compared to the $587.22 million average estimate based on four analysts.Core Operating Profit, non-GAAP measure- Corporate unallocated: $-453 million compared to the $-433.16 million average estimate based on four analysts.Core Operating Profit, non-GAAP measure- LatAm Foods: $620 million compared to the $512.03 million average estimate based on four analysts.Core Operating Profit, non-GAAP measure- Asia Pacific Foods: $134 million versus the four-analyst average estimate of $110.28 million.View all Key Company Metrics for PepsiCo here>>>
Shares of PepsiCo have returned -1.3% over the past month versus the Zacks S&P 500 composite's +1.1% change. The stock currently has a Zacks Rank #4 (Sell), indicating that it could underperform the broader market in the near term.
Published in earnings earnings-estimates-revisions earnings-surprise
PepsiCo Inc (NASDAQ:PEP, XETRA:PEP) shares fell about 4% on Thursday after the food and beverage company reported fiscal second-quarter adjusted earnings that came in slightly below Wall Street expectations, despite revenue topping estimates and the company reaffirming its full-year outlook.
PepsiCo reported adjusted earnings per share of $2.20, compared with analysts' consensus estimate of $2.21.
Net revenue rose 6.4% year over year to $24.18 billion, exceeding expectations of $23.95 billion.
The company said second quarter revenue growth was driven by effective net pricing, organic volume growth, foreign exchange benefits and acquisitions.
International operations continued to support overall performance, with each international segment posting strong net revenue growth. PepsiCo said Asia Pacific Foods, International Beverages Franchise, and Europe, Middle East and Africa benefited from organic volume growth, while Latin America Foods showed sequential improvement in organic volume trends.
In North America, the convenient foods business gained volume market share through innovation and affordability initiatives, although net revenue declined, primarily reflecting lower effective net pricing. The beverages business posted strong net revenue growth, supported by acquisitions completed in 2025 and organic growth.
"Our second quarter results featured strong organic volume and net revenue growth for the global convenient foods and global beverages businesses,” PepsiCo CEO Ramon Laguarta said.
“Year-to-date, PepsiCo's global organic volume has increased at the highest rate since 2022 - aided by the strength of the international business and the continued evolution of the portfolio to offer more choices through portion control varieties, diverse ingredients, functional benefits such as hydration, protein and fiber, energy and zero sugar beverage varieties.”
The company reaffirmed its fiscal 2026 guidance, continuing to expect organic revenue growth of between 2% and 4% and core constant currency EPS growth of between 4% and 6%.
It also maintained its forecast for approximately $8.9 billion in total cash returns to shareholders, including $7.9 billion in dividends and $1.0 billion in share repurchases.
Key Takeaways PepsiCo topped Q2 earnings and revenue estimates as organic revenues rose 2.4% y/y and volumes improved.International organic revenues grew 7%, marking the 21st straight quarter of at least mid-single-digit growth.PEP reaffirmed its 2026 outlook, including 2-4% organic revenue growth and $8.9B in shareholder returns. PepsiCo, Inc. (PEP - Free Report) has reported strong second-quarter 2026 results, wherein revenues and earnings per share (EPS) beat the Zacks Consensus Estimate and improved year over year. Results have reflected organic revenue growth, favorable foreign currency translation, and a net benefit from acquisitions and divestitures.
PEP’s second-quarter core EPS of $2.20 beat the Zacks Consensus Estimate of $2.19 by 0.5% and improved 4% year over year. The company’s core constant-currency EPS increased 1%. Foreign currency aided EPS by 3%. Reported earnings were $2.18 per share versus 92 cents in the year-ago quarter.
Shares of the Zacks Rank #4 (Sell) company have lost 9.1% in the past three months against the industry’s 5% growth.
Image Source: Zacks Investment Research
Peek Into PEP’s Q2 DetailsNet revenues rose 6.4% to $24.18 billion and surpassed the Zacks Consensus Estimate of $23.87 billion by 1.3%. Organic revenues increased 2.4%, with global convenient foods organic volume up 3% and global beverages organic volume up 2%.
PepsiCo’s net revenue growth included a 2.2-percentage-point benefit from foreign exchange translation and a 1.8-percentage-point net benefit from acquisitions and divestitures. Organic revenue growth reflected effective net pricing and a contribution from organic volume growth.
Our model predicted year-over-year organic revenue growth of 2.6% for the second quarter, with a 2.5% gain from the price/mix and a 0.1% rise in volume.
On a consolidated basis, the reported gross profit rose 5.5% year over year to $13.11 billion. The core gross profit increased 4.7% year over year to $13.12 billion. The reported gross margin contracted 50 bps to 54.2%, whereas the core gross margin fell 80 bps year over year to 54.3%, reflecting the continued impacts of cost pressures and business investments.
We anticipated the core gross margin to decline 40 bps year over year to 54.7% in the second quarter. In dollar terms, core gross profit was expected to increase 4.1% year over year.
PepsiCo’s operating profit surged 125% to $4.02 billion in the second quarter of 2026, while core operating profit increased 4% to $4.07 billion. The sharp reported operating profit increase reflected prior-year impairment charges related to the Rockstar and Be & Cheery brands, lower restructuring charges and a favorable net impact of acquisition and divestiture-related charges and credits.
The reported operating margin expanded 875 bps to 16.6%. The core operating margin contracted 40 basis points to 16.8%, as productivity savings and effective net pricing were partly offset by certain operating cost increases.
Our model predicted core SG&A expenses of $8.9 billion, which indicated year-over-year growth of 3.3%. As a percentage of revenues, core SG&A expenses were anticipated to be 37.4%, suggesting a 50-bps decline from the prior-year quarter.
We expected a core operating margin of 17.4%, implying a 20-bps increase from the year-ago quarter’s actual.
PEP’s Segment TrendsPepsiCo Foods North America delivered net revenues of $6.37 billion, down 2% year over year. Organic revenues also declined 2% due to lower effective net pricing. The segment continued to gain volume share in North America, aided by innovation and affordability initiatives. Management noted improvements in household penetration and volume share across the U.S. savory and salty categories.
PepsiCo Beverages North America generated net revenues of $7.24 billion, up 7% year over year. Organic revenues grew 1%, while acquisitions, net of divestitures, contributed 6 percentage points to reported revenue growth. However, the organic volume declined 4%, including a 0.5-percentage-point headwind tied to the case pack water business transition to a third-party partner. Functional hydration and zero-sugar offerings remained bright spots.
International results were the strongest part of the quarter. International organic revenues increased 7%, marking the 21st consecutive quarter of at least mid-single-digit organic revenue growth.
Within the international business, International Beverage (IB) Franchise revenues rose 11% to $1.52 billion, with organic revenues up 9%. The organic volume increased 5% in the segment, which represents more than 60% of global beverage volume. The international convenient foods organic volume increased 4%, which represents 70% of the global convenient foods volume.
Europe, Middle East and Africa revenues increased 10% year over year to $4.98 billion, with organic revenues up 6%. Latin America Foods’ revenues rose 15% to $2.94 billion, while organic revenues increased 4%. Asia Pacific Foods’ revenues advanced 12% to $1.12 billion. Organic revenues grew 9%, supported by a 10% organic volume increase, the strongest volume performance among the reported segments.
Financials of PepsiCo Show StabilityPEP ended second-quarter 2026 with improved liquidity, as cash and cash equivalents of $10.25 billion as of June 13, 2026, increased from $9.16 billion at the end of fiscal 2025. Short-term debt obligations were $10.6 billion, while long-term debt obligations were $42.61 billion.
Net cash provided by operating activities was $2.37 billion as of the end of second-quarter 2026 compared with $996 million in the year-ago period. Capital spending totaled $1.27 billion.
The company paid out cash dividends of $3.91 billion and repurchased $479 million of shares in the first half of 2026.
PEP’s Outlook for 2026PepsiCo has reaffirmed its outlook for 2026. The company expects organic revenue growth of 2-4% and net revenue growth of 4-6% on a reported basis.
Core constant-currency EPS is anticipated to increase 4-6%, with core EPS growth of 5-7%. Based on current rates, foreign exchange translation is expected to provide a 1-percentage-point benefit to reported net revenue and core earnings growth. Acquisitions, net of divestitures, are expected to contribute 1 percentage point to reported revenue growth. The company expects a core effective tax rate of 22% for 2026.
The company expects capital spending to remain below 5% of net revenues, while targeting a free cash flow conversion ratio of at least 80%.
PEP has been committed to rewarding its shareholders through dividends and share buybacks. It expects to return total cash of $8.9 billion to shareholders in 2026, including $7.9 billion in dividends and $1 billion in share repurchases.
Don’t Miss These Better-Ranked StocksFomento Economico Mexicano S.A.B. de C.V. (FMX - Free Report) , alias FEMSA, is a leading Latin American consumer company with operations spanning retail, beverage bottling and logistics, serving millions of customers across multiple markets. The company currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for FEMSA’s 2026 sales and earnings implies growth of 17.3% and 131%, respectively, from the previous year’s reported numbers. FMX delivered a trailing four-quarter negative earnings surprise of 17%, on average.
The Coca-Cola Company (KO - Free Report) is the world's largest non-alcoholic beverage company, marketing a broad portfolio of sparkling soft drinks, water, juice, coffee, tea and sports beverages. It currently carries a Zacks Rank #2 (Buy).
The Zacks Consensus Estimate for Coca-Cola’s 2026 sales and earnings indicates growth of 3% and 8.7%, respectively, from the prior-year reported levels. KO delivered a trailing four-quarter earnings surprise of 4.5%, on average.
Ambev S.A. (ABEV - Free Report) is a leading beverage company in Latin America, producing, distributing and selling beer, soft drinks and other non-alcoholic beverages across multiple markets in the region. It carries a Zacks Rank #2 at present.
The Zacks Consensus Estimate for Ambev’s 2026 sales and earnings implies increases of 16.7% and 16.6%, respectively, from the prior-year reported levels.
PepsiCo (PEP) sees strength abroad but weakness in the U.S. Marley Kayden walks investors through the legacy snack and drink company's earnings and explains why domestic revenue is continuing the stock's downslide. Joe Tigay offers an example options trade for PepsiCo. ======== Schwab Network ======== Empowering every investor and trader, every market day.
U.S. stocks traded higher midway through trading, with the Dow Jones index gaining over 150 points on Thursday.
The Dow traded up 0.32% to 52,513.93 while the NASDAQ rose 0.84% to 26,088.28. The S&P 500 also rose, gaining, 0.60% to 7,527.54.
Leading and Lagging Sectors
Information technology shares jumped by 1.3% on Thursday.
In trading on Thursday, communication services stocks fell by 1.7%.
Top Headline
PepsiCo, Inc. (NASDAQ:PEP) shares fell around 5% on Thursday after the company reported second-quarter results Thursday that topped revenue expectations but fell just short on adjusted earnings.
Net revenue rose 6.4% year over year to $24.18 billion, beating the $23.96 billion analyst estimate. Core EPS increased 4% to $2.20, missing the $2.21 estimate, while GAAP EPS rose 137% to $2.18.
Equities Trading UP
Equities Trading DOWN
Commodities
In commodity news, oil traded down 0.9% to $72.87 while gold traded up 1.3% at $4,135.80.
Silver traded up 3.6% to $60.670 on Thursday, while copper rose 2.6% to $6.2630.
Euro zone
European shares were mostly higher today. The eurozone’s STOXX 600 rose 0.7%, while Spain’s IBEX 35 Index rose 1%. London’s FTSE 100 fell 0.4%, Germany’s DAX gained 0.5%, while France’s CAC 40 gained 0.7%.
Asia Pacific Markets
Asian markets closed mixed on Thursday, with Japan’s Nikkei 225 gaining 1.38%, Hong Kong’s Hang Seng index falling 0.70%, China’s Shanghai Composite rising 1.65% and India’s BSE Sensex gaining 0.31%.
Economics
U.S. initial jobless claims declined by 2,000 to 215,000 in the week to July 4, compared to market estimates of 218,000.
Photo via Shutterstock
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For most of 2026, Intel (INTC +2.68%) was the comeback story of the chip sector. The stock had more than tripled on the belief that its new 18A manufacturing process would finally put the company back on the leading edge. Then, over the past week, the rally came apart.
Intel shares have tumbled about 21% in a week, trading at about $110 as of this writing. That is a jarring reversal for one of the market's best performers this year.
So what actually broke the rally? Three separate pressures landed at nearly the same time. Here's a look at each -- and which one should matter most to investors.
Image source: Getty Images.
The 18A payoff got pushed out Intel's whole 2026 run rested on one idea: that 18A, its most advanced process, would ramp this year and pull the money-losing foundry business toward profitability.
Reports over the past week complicated that story. According to industry reports, 18A yields (the share of chips that come off the line usable) may not reach profitable levels until late 2026 or 2027 -- later than bulls had assumed.
That timing matters because Intel is still losing money in manufacturing. In the first quarter of 2026, Intel foundry generated less than $200 million in external customer revenue and posted a steep operating loss. The longer 18A takes to yield well, the longer investors wait for the payoff on a stock that had already priced success in.
Yields aren't a minor detail, either. Every chip that comes off the line unusable is wasted wafer cost, so weak yields squeeze Intel's revenue and its margins at the same time.
This is the pressure that should worry shareholders most. The other two are about competition and mood. This one goes to the heart of why the stock ran in the first place.
AMD passed it in the data center In the first quarter of 2026, AMD out-earned Intel in the data center.
In the first quarter of 2026, AMD's data-center segment generated $5.8 billion in revenue, up 57% year over year. Intel's own data-center business brought in $5.1 billion, up a respectable 22%. The crossover stings, because data-center chips have been Intel's stronghold for decades.
There is some nuance worth noting. AMD's segment includes its Instinct artificial intelligence (AI) accelerators, not just server processors, so part of that lead is a graphics-chip story. Specifically for server processors, Intel still ships about two-thirds of the units. But it now collects only a little more than half the revenue, because AMD keeps winning the higher-priced chips.
Either way, the direction is clear: Intel's grip on its most profitable market is loosening.
A sectorwide sell-off did the rest The final pressure had nothing to do with Intel specifically. A widely read note from a big bank warned of bubble-like conditions in AI stocks, and even a record profit from memory maker Samsung -- read as a sign the memory boom was peaking -- did nothing to lift the mood. Chip stocks sold off across the board.
Intel, already wobbling on its own news, fell harder than most. When sentiment turns against a whole sector, the names with the shakiest stories tend to get hit worst -- and Intel had just handed the market two fresh reasons to worry. The sell-off erased roughly a fifth of the company's market value in a matter of days.
Today's Change
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Does the crash change the case? So has a 21% drop made Intel a bargain? I don't think it's that simple.
Two of the three pressures are arguably just noise. Sector sentiment will swing back eventually, and AMD's data-center lead, while real, was hardly a secret. But the 18A delay is different. It pushes out the single event the bull case was built around, even as the foundry is still burning cash.
And even after the drop, Intel isn't obviously cheap. It's unprofitable on a trailing basis, and its stock still trades at more than 100 times expected earnings over the next 12 months -- a far richer multiple than the broader market, which sits in the low-to-mid 20s.
To be fair, Intel's data-center revenue is still growing, its foundry is slowly signing up outside customers, and 18A may yet ramp on a reasonable timeline. But the stock had been priced for that ramp to materialize this year, and that assumption just took a real hit. Personally, I'd want hard evidence that 18A yields are improving before treating this crash as an opportunity rather than a warning.
Key Takeaways Datadog targets higher 2026 revenues as AI launches, customer growth and FedRAMP High expand opportunities.Alphabet highlighted AI, cloud backlog, infrastructure investment and Waymo growth in its 2026 outlook.Shopify and Paylocity advanced AI, platform expansion and capital returns alongside 2026 growth guidance. Internet stocks in the United States, including Datadog (DDOG - Free Report) , Alphabet (GOOGL - Free Report) , Shopify (SHOP - Free Report) and Paylocity Holding (PCTY - Free Report) , look set for a constructive second half of 2026, as enterprises move agentic AI from pilot projects into daily operations across the Internet economy. Gartner forecasts worldwide spending on AI platforms and services to reach $2.52 trillion in 2026, a 44% jump from last year, and that wave of budget is flowing directly into Internet-native cloud application vendors, search platforms and customer-experience software makers, giving Internet companies a direct line to fresh enterprise dollars rather than leaving the gains to chipmakers.
Cloud reacceleration is the clearest boost for Internet stocks. Azure, AWS and Google Cloud have posted growth rates north of 25% this year, and rising backlog figures across these Internet platforms suggest AI workloads are finally converting from commitments into billed revenues.
Internet software leaders like Salesforce and ServiceNow are layering autonomous AI agents onto existing subscription products, a shift Grand View Research values within a broader agentic AI market projected to grow from $7.6 billion in 2025 to $10.9 billion in 2026. That trajectory should lift Internet stock valuations by supporting premium subscription pricing and stickier renewals.
Internet infrastructure and security names stand to benefit too, as traffic-based businesses sitting close to the Internet's core plumbing see early signs that agentic AI usage, not just human browsing, is becoming a meaningful new demand driver for their networks.
Digital advertising is another quiet lift for Internet stocks, with AI-driven ad tools now used by a growing share of major advertisers, expanding monetizable Internet surface area for search and social platforms without requiring new inventory.
Risks remain around capex scrutiny and valuation resets after a volatile first half, but broadening AI adoption across the Internet stack leaves these stocks tied to productivity, commerce and cloud well placed to close 2026 on firmer footing.
Our PicksHere, we have selected four tech stocks that are well-poised to grow in the rest of 2026, driven by their strong fundamentals. These stocks also have the favorable combination of a Growth Score of A or B and a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Per Zacks’ proprietary methodology, stocks with such a favorable combination offer solid investment opportunities.
Year-to-Date Performance
Image Source: Zacks Investment Research
Datadog's near-term outlook appears constructive, supported by a deepening competitive moat and accelerating product innovation. Company guidance targets full-year 2026 revenues of $4.30-$4.34 billion, reflecting sustained enterprise demand for cloud-native observability and security. As of first-quarter 2026, approximately 4,550 customers carried $100,000-plus ARR, up 21% year over year, evidencing robust platform adoption and customer wallet expansion. At DASH in June 2026, Datadog launched 100+ new capabilities, headlined by a fully autonomous Bits AI suite — independently detecting, investigating and remediating production issues — alongside AI Guard for agentic security. The late-June acquisition of Adaptive ML, a pioneer in Reinforcement Learning Operations, expands its proprietary AI research program. A newly achieved FedRAMP High certification further unlocks the federal government as an additional meaningful revenue opportunity.
This Zacks Rank #1 stock has a Growth Score of B. The Zacks Consensus Estimate for 2026 earnings has moved upward by 2.1% to $2.41 per share over the past 60 days.
Alphabet is entering an accelerated AI monetization phase with compelling near-term fundamentals. At Google I/O in May 2026, the company unveiled Gemini 3.5 and Gemini Omni, marking a decisive shift to agentic workflows, with over 8.5 million developers building on its models monthly. Google Cloud's backlog stood at over $460 billion, with approximately 50% convertible to revenues within 24 months. In June 2026, Alphabet upsized its equity raise to $84.75 billion — including a $10 billion Berkshire Hathaway placement — earmarked for AI infrastructure. Management guided 2026 capex at $180-$190 billion to meet unprecedented, growing customer demand. Waymo surpassed 500,000 autonomous rides weekly, while management guided a positive FX tailwind for second-quarter 2026. These fundamental factors position Alphabet constructively for near-term upside.
This Zacks Rank #2 stock has a Growth Score of B. The Zacks Consensus Estimate for 2026 earnings has moved north by 0.2% to $14.32 per share over the past 60 days.
Shopify presents a compelling near-term opportunity anchored in durable fundamentals and strategic momentum. The company's second-quarter 2026 guidance calls for high-twenties revenue growth and mid-teens free cash flow margins, reflecting broad-based platform strength across geographies, merchant sizes and channels. The Spring '26 Edition, unveiled June 2026, introduced 150+ platform updates, including the Shopify Catalog API, Universal Commerce Protocol and agentic storefronts, positioning Shopify as the infrastructure layer for AI-driven commerce. Monthly Recurring Revenue reached $212 million through expanding merchant solutions. In June 2026, the board raised its share repurchase authorization to an aggregate of $5 billion, signaling confidence in cash generation. A consistent 15% free cash flow margin reinforces Shopify's ability to invest in growth while returning capital to shareholders.
This Zacks Rank #2 stock has a Growth Score of B. The Zacks Consensus Estimate for 2026 earnings has moved up by 1.7% to $1.83 per share over the past 60 days.
Paylocity's expanding platform strategy positions it well for near-term growth. The June 2026 launch of Paylocity Retirement, embedding Vestwell's technology directly into its HCM suite, deepens the platform's stickiness and broadens its addressable revenue per client. The April 2026 acquisition of Grayscale Labs further strengthens AI-powered recruiting capabilities, augmenting a product suite already spanning HCM, Finance and IT. The April launch of Elevate Solutions — combining the unified platform with dedicated operational HR and payroll expertise — addresses scalability needs across its roughly 42,000 clients. Updated 2026 guidance anticipates fourth-quarter recurring revenue growth of approximately 9-10% year over year, underpinned by a trailing free cash flow margin of 24.4% and a board-approved $1.35 billion share repurchase authorization, signaling durable financial confidence.
This Zacks Rank #2 stock has a Growth Score of B. The Zacks Consensus Estimate for 2026 earnings has increased 1.8% to $8.09 per share over the past 60 days.
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Technology
IBM—and Quantum Computing—Get an Unlikely Celebrity Endorsement
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The clearest sign that quantum computing has breached the cultural mainstream is that even professional basketball players are taking notice.
Merck (MRK - Free Report) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.
Shares of this pharmaceutical company have returned +5.8% over the past month versus the Zacks S&P 500 composite's +1.1% change. The Zacks Large Cap Pharmaceuticals industry, to which Merck belongs, has gained 8.1% over this period. Now the key question is: Where could the stock be headed in the near term?
While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.
Revisions to Earnings EstimatesHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.
Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.
Merck is expected to post earnings of $2.12 per share for the current quarter, representing a year-over-year change of -0.5%. Over the last 30 days, the Zacks Consensus Estimate has changed +1%.
The consensus earnings estimate of $5.19 for the current fiscal year indicates a year-over-year change of -42.2%. This estimate has changed +0.5% over the last 30 days.
For the next fiscal year, the consensus earnings estimate of $9.9 indicates a change of +90.7% from what Merck is expected to report a year ago. Over the past month, the estimate has changed +0.9%.
With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for Merck.
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Revenue Growth ForecastEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
For Merck, the consensus sales estimate for the current quarter of $16.3 billion indicates a year-over-year change of +3.1%. For the current and next fiscal years, $66.76 billion and $70.26 billion estimates indicate +2.7% and +5.2% changes, respectively.
Last Reported Results and Surprise HistoryMerck reported revenues of $16.29 billion in the last reported quarter, representing a year-over-year change of +4.9%. EPS of -$1.28 for the same period compares with $2.22 a year ago.
Compared to the Zacks Consensus Estimate of $15.9 billion, the reported revenues represent a surprise of +2.44%. The EPS surprise was +15.23%.
The company beat consensus EPS estimates in each of the trailing four quarters. The company topped consensus revenue estimates three times over this period.
ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.
Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Merck is graded C on this front, indicating that it is trading at par with its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Merck. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.
For new and old investors, taking full advantage of the stock market and investing with confidence are common goals. Zacks Premium provides lots of different ways to do both.
Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor.
Zacks Premium includes access to the Zacks Style Scores as well.
What are the Zacks Style Scores? The Zacks Style Scores, developed alongside the Zacks Rank, are complementary indicators that rate stocks based on three widely-followed investing methodologies; they also help investors pick stocks with the best chances of beating the market over the next 30 days.
Each stock is given an alphabetic rating of A, B, C, D or F based on their value, growth, and momentum qualities. With this system, an A is better than a B, a B is better than a C, and so on, meaning the better the score, the better chance the stock will outperform.
The Style Scores are broken down into four categories:
Value 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 ScoreWhile good value is important, growth investors are more focused on a company's financial strength and health, and its future outlook. The Growth Style Score takes projected and historic earnings, sales, and cash flow into account to uncover stocks that will see long-term, sustainable growth.
Momentum ScoreMomentum investors, who live by the saying "the trend is your friend," are most interested in taking advantage of upward or downward trends in a stock's price or earnings outlook. Utilizing one-week price change and the monthly percentage change in earnings estimates, among other factors, the Momentum Style Score can help determine favorable times to buy high-momentum stocks.
VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.
How Style Scores Work with the Zacks Rank The Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.
It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +23.94% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.
With more than 800 top-rated stocks to choose from, it can certainly feel overwhelming to pick the ones that are right for you and your investing journey.
That's where the Style Scores come in.
You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only has a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.
As mentioned above, the Scores are designed to work with the Zacks Rank, so any change to a company's earnings outlook should be a deciding factor when picking which stocks to buy.
A stock with a #4 (Sell) or #5 (Strong Sell) rating, for instance, even one with Scores of A and B, will still have a declining earnings forecast, and a greater chance its share price will fall too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Phillips 66 (PSX - Free Report) Based in Houston, TX, Phillips 66 is a diversified and integrated energy company established following the 2012 spin-off of ConocoPhillips' downstream operations. As one of the world's leading refiners, Phillips 66 operates 13 refineries, primarily in the United States, with a total refining capacity of about 2.2 million barrels per day.
PSX is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.
Momentum investors should take note of this Oils-Energy stock. PSX has a Momentum Style Score of A, and shares are up 3.4% over the past four weeks.
Three analysts revised their earnings estimate upwards in the last 60 days for fiscal 2026. The Zacks Consensus Estimate has increased $1.91 to $19.27 per share. PSX boasts an average earnings surprise of +67.8%.
With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, PSX should be on investors' short list.
Key Takeaways Phillips 66 is likely to benefit as WTI stays below $75, keeping feedstock costs attractive.Renewed Middle East tensions have supported oil prices, but traders remain cautious on Hormuz risks.Softer crude prices may also aid Marathon Petroleum and Valero Energy through lower input costs. West Texas Intermediate (“WTI”) oil is currently trading below $75 per barrel, according to data from Oilprice.com, significantly down from the more than $100 per barrel mark reached in May this year. However, renewed tensions in the Middle East, following President Donald Trump's statement that the ceasefire agreement with Iran is no longer in effect, are once again supporting oil prices.
Considering the uncertainty arising from the renewed tensions, with the United States and Iran having already exchanged new, intense attacks, and its impact on the flow of oil through the Strait of Hormuz, which is responsible for the flow of significant global oil volumes, traders are taking a cautious approach. Oil prices remaining significantly below the highs seen earlier this year are aiding refiners like Phillips 66 (PSX - Free Report) with relatively attractive feedstock costs.
In other words, PSX, a leading refining company, is now able to purchase oil at a lower cost, enabling the production of end products. Thus, Phillips 66, which generates significant margin from its refining activities, is likely to benefit from lower oil prices.
Will MPC & VLO Also Gain?Marathon Petroleum Corp. (MPC - Free Report) and Valero Energy Corporation (VLO - Free Report) are two other leading refining companies that are well poised to gain from the relatively softer crude prices.
MPC runs refining systems that are the largest in the United States. With high utilization of refineries, Marathon Petroleum is well-positioned to capture almost all of the available profitable opportunities.
For refiners like Valero Energy, the soft oil prices will also likely aid refining margins, as input costs are still lower.
Apart from this, investors should note that the global refining capacity is constrained and fuel inventories are low. On the demand side, gasoline, diesel and jet fuel remain resilient. This means people are still driving and flying quite often, while diesel demand suggests that transportation, freight, agriculture and industrial activity are still holding up. As a result, with higher refinery activity and constrained fuel supply, refining margins for refiners like VLO are quite strong.
PSX’s Price Performance, Valuation & EstimatesShares of PSX have gained 39.8% over the past year compared with the 34.1% improvement of the industry.
Image Source: Zacks Investment Research
From a valuation standpoint, PSX trades at a trailing 12-month enterprise value to EBITDA of 13.26X. This is above the broader industry average of 5.58X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for PSX’s 2026 earnings has seen upward revisions over the past 30 days.
Image Source: Zacks Investment Research
PSX currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Salesforce Inc. CRM shares fell 2.5% on Thursday after KeyBanc downgraded the software company, citing concerns that its Agentforce artificial intelligence platform may take longer than expected to become a meaningful growth driver.
The downgrade came despite Salesforce's strong position in enterprise software and follows the company's better-than-expected fiscal first-quarter results reported in late May.
Investors have remained focused on whether the company's AI investments can translate into sustained revenue growth as competition in enterprise artificial intelligence intensifies.
KeyBanc downgraded Salesforce to Sector Weight from Overweight on Thursday, with analyst Jackson Ader pointing to customer feedback and channel checks that suggest Agentforce adoption remains in its early stages.
According to the brokerage, Salesforce continues to benefit from its position as an incumbent platform provider, but evidence indicates that meaningful growth acceleration from Agentforce is further away than previously expected.
The firm said it attends more Salesforce partner and customer events than any other company in its coverage universe.
Customer feedback has been consistent in two areas, according to KeyBanc.
Customers' data is not yet organized to support meaningful AI work, while Agentforce itself is still not ready for broad deployment.
The brokerage added that implementation partners are only now beginning to convert Agentforce proof-of-concept projects into pipeline deals.
KeyBanc also said its survey found that more chief information officers expect to deprioritize Salesforce within their IT budgets over the next 12 months than prioritize it.
The brokerage further noted that it has struggled to find evidence in Salesforce's financial disclosures showing that net-new annual contract value is growing faster than overall annual contract value growth, despite management's comments.
"What we can piece together in the disclosed numbers does not signal building momentum," Ader said.
Ader also acknowledged the timing of the downgrade saying it could be at a poor time.
"But at some point, we have to ask ourselves, why gather the evidence if we’re not going to use it," he added.
AI growth remains under scrutinyThe downgrade comes after Salesforce reported stronger-than-expected fiscal first-quarter earnings in late May, supported by demand for its AI-powered products, including Agentforce.
The company said it closed 98 deals worth more than $1 million in annual contract value during the quarter.
Publicly disclosed Agentforce customers include PepsiCo, Falabella and Singapore Airlines.
However, Salesforce's second-quarter revenue guidance came in slightly below Wall Street expectations, raising concerns that rapidly advancing AI products from rivals such as OpenAI and Anthropic continue to pressure demand for enterprise software.
KeyBanc noted that it had previously pushed back against negative sentiment surrounding software-as-a-service companies, highlighting the advantages that incumbent platforms such as Salesforce possess.
However, the firm's latest customer checks prompted it to revise its view.
On Wednesday, Salesforce announced that the US Air Force 441st Vehicle Support Chain Operations Squadron (VSCOS) had begun using the company's Missionforce National Security platform to manage a fleet of more than 84,000 vehicles across nearly 389 locations.
Despite Thursday's decline, Wall Street sentiment remains broadly positive.
More than 70% of analysts covering Salesforce rate the stock a Buy, with an average price target of $241.08, implying roughly 45% upside from Wednesday's closing price of $166.58.
Still, Salesforce has struggled this year. The stock has fallen 35% in 2026.
