The third-quarter 2023 earnings season has commenced, and we are in the first big week of the reporting cycle with 954 companies slated to release their quarterly financial numbers. So far, the results are better-than-expected. This week the main thrust will be on big techs. However, aside from tech giants, several large-cap stocks will also report.
Third-Quarter Earnings So Far
The season has begun with weak expectations as the market’s benchmark — the S&P 500 Index — is likely to witness the fourth consecutive quarter of earnings decline. As of Oct 20, 86 companies have reported results. Total earnings of these companies are up 1.9% year over year on 5.8% higher revenues, with 79.1% beating EPS estimates and 61.6% beating revenue estimates.
For third-quarter 2023, total earnings of the S&P 500 companies are currently expected to be down -1.8% year over year on 0.8% higher revenues. However, our current projection has shown that this reporting cycle is expected to be the last period of declining earnings for the S&P 500 Index, with positive growth resuming from the fourth quarter. In this regard, the guidance given by management will be of utmost importance.
Our Top Picks
We have narrowed our search to five large-cap stocks that are set to declare third-quarter earnings results this week. Each of our picks carries a Zacks Rank #2 (Buy) and has a positive Earnings ESP. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Our research shows that for stocks with the combination of a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, the chance of an earnings beat is as high as 70%. These stocks are anticipated to appreciate after their earnings release. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The chart below shows the price performance of selected stocks in the last quarter.
Image Source: Zacks Investment Research
Edwards Lifesciences Corp. (EW - Free Report) continues to gain traction for its leading SAPIEN platform within the TAVR product group. The growing adoption of the PASCAL Precision system, overall procedure volumes, the expansion of new centers across Europe and the United States are aiding the TMTT segment’s growth.
Given the strong first-half performance of the portfolio and improved signs of healthcare staffing, EW lifted its expectations for 2023. Our estimates suggest a CAGR of 10% in EW’s revenues through 2023-2025.
Edwards Lifesciences has an Earnings ESP of +3.06%. It has an expected earnings growth rate of 2.8% for the current year. EW recorded earnings surprises in three out of the last four reported quarters, with an average beat of 1.6%. The company is set to release earnings results on Oct 25, after the closing bell.
VICI Properties Inc. (VICI - Free Report) is a real estate investment trust. VICI is primarily engaged in the business of owning, acquiring and developing gaming, hospitality and entertainment destinations. VICI’s operating segment consists of real property business and golf course business.
VICI Properties has an Earnings ESP of +1.50%. It has an expected earnings growth rate of 10.9% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.5% over the last seven days.
VICI recorded earnings surprises in the last four reported quarters, with an average beat of 1.5%. The company is set to release earnings results on Oct 25, after the closing bell.
Vulcan Materials Co. (VMC - Free Report) is benefiting from robust public sector demand, consistent strategic execution and a strong aggregates-led business. Pricing growth, fixed cost leverage and operating efficiencies, along with a systematic inorganic strategy for expansion, large industrial projects and steady residential construction activity, are added positives for VMC.
Given the aggregates shipment trends and the earnings momentum in the Asphalt segment in the first half of 2023, VMC lifted its full-year expectations. VMC now anticipates adjusted EBITDA within $1.9-$2 billion and net earnings of $855-$935 million.
Vulcan Materials has an Earnings ESP of +0.48%. It has an expected earnings growth rate of 34.3% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.6% over the last 30 days.
VMC recorded earnings surprises in three out of the last four reported quarters, with an average beat of 14%. The company is set to release earnings results on Oct 26, before the opening bell.
Mobileye Global Inc. (MBLY - Free Report) expects 2023 revenues to rise 11.7% year over year at the midpoint of the guidance. MBLY’s SuperVision driver assist serves as a key catalyst for growth, experiencing robust adoption from ZEEKR and Porsche. Mobileye global has secured a record stream of design wins, creating a $17 billion revenue pipeline through 2030. In 2023, MBLY’s pipeline of opportunities surpasses the projected $6.7 billion.
Mobileye Global has an Earnings ESP of +5.88%. MBLY recorded earnings surprises in the last four reported quarters, with an average beat of 26%. The company is set to release earnings results on Oct 26, before the opening bell.
Gaming and Leisure Properties Inc. (GLPI - Free Report) is a self-administered, self-managed REIT primarily engaged in the property business, which will consist of owning, acquiring, developing, expanding, managing, and leasing gaming and related facilities.
GLPI has an Earnings ESP of +0.22%. It has an expected earnings growth rate of 3.9% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.3% over the last seven days.
GLPI recorded earnings surprises in three out of the last four reported quarters, with an average beat of 0.8%. The company is set to release earnings results on Oct 26, after the closing bell.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
