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Q2 Earnings Tuesday: Mixed Bag for Most

Tuesday, August 1st, 2017

Though we’ve seen plenty of marquee names put out quarterly earnings reports already in this calendar Q2 — with Apple AAPL due after the closing bell this afternoon — there are still a large amount of well-known firms having reported in Tuesday’s pre-market. UnderArmour UAA, Pfizer PFE, Archer Daniels Midland ADM, among others, hit the tape this morning.

We also see new econ datas this morning and on the horizon, including Personal Income and Spending reads. These precede tomorrow’s ADP private sector jobs report, which itself precedes Friday’s full non-farm payroll results. In other words, a full plate of data to help move the needle for investors in the hours and days ahead.

The June read for Personal Income and Spending was a disappointment: unchanged from the previous month, which itself was bumped down from 0.4% to 0.3% from its initial reported number. Analysts had expected another +0.4% in income growth. Spending came in as expected: +0.1% for June. These figures continue to show the lag between production and wage growth continues, keeping prices lower for longer, including employee salaries, while spending remained constant.

Specialty retailer UnderArmour outperformed expectations in its Q2, posting a loss much narrower on the bottom line than expected: -3 cents per share compared to -6 cents. Quarterly sales of $1.088 billion also beat expectations of $1.075 billion. However, when the Zacks Rank #3 (Hold) company lowered full-year 2017 guidance to below the current Zacks consensus, UAA shares fell like a stone. They’ve since rebounded, as the company’s restructuring initiatives (worth $130 million) look to make notable improvements in its longer-term plans.

Pfizer reported a mixed Q2 this morning, beating estimates on the bottom line by 2 cents to 67 cents per share, but once again coming up short on the revenue side, $12.9 billion compared to the $13.0 billion in the Zacks consensus. However, earnings guidance for 2017 was raised this morning, though sales guidance stayed pat.

Archer Daniels Midland outperformed expectations on its bottom line, posting 57 cents per share as opposed to 52 cents analysts were looking for. This breaks a fairly woeful previous year of earnings, three of four which failed to meet consensus. That said, quarterly sales came in almost a billion dollars light from expectations: $14.94 billion (-4.4% year over year) compared with the $15.84 billion in the estimate.

London-based BP BP brought a solid earnings surprise ahead of the opening bell today, reporting 21 cents per share, a full dime higher than the Zacks consensus estimate. However, revenues also fell short of expectations, bringing in $57.37 billion in the quarter compared to the $64.51 billion estimated. Oil (equivalent) production was up 9% year over year, and price realization improved nicely year over year.

Mark Vickery
Senior Editor

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