The third-quarter earnings season is upon us, and all eyes are on the renowned “Magnificent 7″ or “Mag 7” companies. These market favorites that dazzled investors in the initial half of 2024 have experienced a downturn in recent months. The fading AI trend and investors’ shift towards sectors that benefit most from rate cuts have impacted these stalwarts.
Comprising the “Mag 7” are Tesla (TSLA), Alphabet (GOOGL), Meta Platforms (META), Microsoft (MSFT), Apple (AAPL), Amazon (AMZN), and NVIDIA (NVDA). Among these, Tesla is set to lead the pack with its impending earnings release after today’s market close. Following Tesla, Alphabet is scheduled to report on Oct. 29, with Microsoft and Meta Platforms following suit on Oct. 30, and Apple and Amazon on Oct. 31. NVIDIA’s report is anticipated next month.
Projections indicate a 16.2% rise in the third-quarter earnings of the “Mag 7” compared to the same period last year, accompanied by a 13.6% increase in revenues. In the second quarter, the Mag 7 demonstrated substantial growth of 35.2% in earnings with 14.7% higher revenues.
Wondering how these quarterly releases might impact your investments? Stay informed with the Earnings Calendar.
Tesla – Charging Ahead
Tesla stands with an Earnings ESP of -1.28% and a Zacks Rank #2 (Buy). While the electric carmaker did not witness any earnings estimate revisions for the third quarter of 2024 in the past 30 days, the Zacks Consensus Estimate indicates a significant year-over-year earnings drop of 12.1% alongside a 9.5% revenue growth. Despite a poor earnings track record with a four-quarter average negative surprise of 7.99%, Tesla displayed a 5.7% decline in the last three months.
The Charge Forward
Tesla recently bounced back in the third quarter with a resurgence in deliveries, marking its third-largest quarterly figure. Investors are watchful for details on Tesla’s plans for an affordable EV priced under $30,000 and its long-term Cybercab strategy post the Robotaxi event that left investors underwhelmed due to the absence of concrete ride-sharing platform specifics.
Alphabet – Navigating Challenges
Alphabet boasts an Earnings ESP of +1.57% and Zacks Rank #2. Despite no earnings estimate adjustments for the third quarter of 2024 in the last 30 days, the company has upheld a commendable earnings surprise average of 9.60% across the previous four quarters. Earnings are anticipated to surge by 18.1% with a 13.6% revenue growth from the year-ago quarter. However, the Internet giant has faced a 9% decline over the past three months, amidst antitrust lawsuits and mounting AI competition challenges.
Navigating Rough Waters
Google confronts headwinds from antitrust litigations and stiffening competition in the AI domain. Concerns loom over the impact of generative AI on Google’s primary search business.
Meta Platforms – Shaping the Future
Meta Platforms boasts an Earnings ESP of +2.83% and Zacks Rank #2. The social media titan experienced a positive earnings estimate amendment of 2 cents for the third quarter of 2024 within the last 30 days, indicating analysts’ confidence. Projections suggest substantial year-over-year earnings growth of 17.8% and a 17.6% revenue surge. Meta Platforms showcased an average earnings surprise of 12.61% over the last four quarters and has ascended by about 23.5% over the past three months.
An Innovative Journey Ahead
Trading near its all-time peak, Meta Platforms garnered raised target prices from several analysts ahead of its earnings, reflecting robust confidence in the company’s progress. Analysts like UBS, Guggenheim, Jefferies, TD Cowen, and KeyBanc upped their price targets, citing improved user engagement and enhanced monetization of video content. The surge in ad load and overall usage of the Reels feature signal anticipated growth for Instagram.
Microsoft – Software Powerhouse
Microsoft displays an Earnings ESP of -0.74% and holds a Zacks Rank #3. With a positive earnings estimate tweak of a cent over the last 30 days for the third quarter of 2024, Microsoft maintains an impressive four-quarter earnings surprise average of 6.34%. The Zacks Consensus Estimate predicts a 3% earnings rise and 14% revenue growth from the year-ago quarter. Nevertheless, Microsoft observed a 4% slump over the past three months.
The Technological Maven
Insights into Fourth Quarter Financial Performances
The tech giants are hard at work, each carving out their own slice of the market pie. Let’s delve into recent developments from the world of high finance and see what’s cooking with the major players.
Apple’s Strategic Maneuvers
In a daring move, Apple reveals a mixed bag of fortunes on the horizon, showcasing positive earnings surprises and sluggish growth projections. Will the iPhone behemoth be able to maintain its supremacy in the tech realm?
Apple Inc. Price, Consensus and EPS Surprise
Apple, with its eye on the next big upgrade cycle, is playing its cards right with AI-infused iPhone 16 models. The recent market buzz around its flagship offerings hint at a potential revival in Apple’s fortunes, raising hopes among investors. A delicate dance of innovation and market demand awaits.
Amazon’s Reign over E-Commerce
Amazon, the undisputed monarch of online retail, continues its triumphant march, leveraging the boom in its advertising and cloud computing segments. As the digital landscape evolves, will Amazon’s strategic investments propel it to greater heights?
Amazon.com, Inc. Price, Consensus and EPS Surprise
Amidst the flurry of activity, Amazon presents a robust earnings outlook and anticipates substantial revenue growth for the next fiscal quarter. With its fingers firmly on the pulse of e-commerce and AI, Amazon stands poised to conquer new frontiers.
NVIDIA’s Dominance in AI Chip Design
NVIDIA, the undisputed juggernaut in AI chip design, continues to push the envelope, showcasing stellar earnings and revenue growth projections. Will NVIDIA’s unwavering dedication to cutting-edge technology solidify its position as the industry leader?
NVIDIA Corporation Price, Consensus and EPS Surprise
With a stronghold on AI chip design and an impressive earnings history, NVIDIA stands tall in a competitive landscape. Wall Street’s optimism, coupled with soaring demand for AI technologies, paints a promising picture for NVIDIA’s future trajectory.
The Unveiling of Future Market Leaders
Peering into the crystal ball of financial foresight, Zacks’ Research Chief highlights a selected few poised for exceptional growth. Amidst the ever-changing tides of the stock market, which of these emerging stars will shine the brightest?
A new dawn is approaching, where innovation and ambition collide to shape the financial landscape. Stay tuned as the tech titans navigate through the choppy waters of the digital economy, each vying for a coveted spot in the sun.
For more financial insights and in-depth analyses, explore further on Zacks Investment Research.