We are currently in the heart of earnings season. Two things come to mind every earnings season that we always like to mention. First, despite the enjoyment from four beautiful and distinct seasons here in New England, our favorite season remains earnings season! Second, as we say every quarter – profits are the mother’s milk of stock prices! To give you a flavor of the results so far, let’s look at the earnings action from last week.
AT&T shareholders liked what they heard (and saw) as the company beat on both earnings and revenues and posted wireless subscriber growth above expectations – the stock jumped over 6%. Starbucks brewed up a beat on both the top and bottom lines as well, and investors enjoyed the taste of an over 8% rise in the stock price. After initially dropping on both an earnings and revenue miss, Tesla shares reversed direction and drove to higher ground after CEO Elon Musk made positive comments on future growth. Shares of Big Blue – International Business Machines (IBM) – finished solidly in the green, up nearly 13%, after earnings beat and mention by management of strong demand for new Artificial Intelligence projects.
Meta Platforms shareholders were all smiles after the company posted a significant beat on earnings, along with beating on revenues as well. The stock ended the day only modestly higher, however, as the overall tech sector was out of favor last week. Despite better-than-expected earnings, United Parcel Service stock fell over 14% after the company delivered news it would reduce volume by its largest customer, Amazon.com, by over 50% in the second half of 2026. Speaking of Amazon, they report earnings results this week, as do a long list of other companies.
Get ready for the busiest week of earnings season. Along with Amazon.com, other widely followed names scheduled to report results this week include Advanced Micro Devices, Alphabet, Amgen, Bristol-Myers Squibb, Clorox, Eli Lilly, Hershey, Honeywell, Merck, PepsiCo, Pfizer, Qualcomm, Uber Technologies, and Walt Disney.
Looking at earnings results in total so far: For the fourth quarter of 2024, with 36% of S&P 500 companies reporting actual results, 77% of S&P 500 companies have reported a positive EPS surprise (which is above the 10-year average of 75%) and 63% of S&P 500 companies have reported a positive revenue surprise – according to FactSet.
Away from earnings, the U.S. Bureau of Labor Statistics is scheduled to release the all-important Jobs Report Friday morning. Expectations are the economy added 170,000 jobs last month and that the unemployment rate remained steady at 4.1%. Also of course, financial markets around the world will be watching and gauging developments regarding tariffs. Be ready for a busy and potentially volatile week.
As always, please contact us with any questions you may have or if you would like to set up a meeting.
All the best – Southport Station Financial Management, LLC