Also this week, Netflix (NFLX), Johnson & Johnson (JNJ), ASML Holdings (ASML), and PepsiCo (PEP) feature on the corporate update schedule.
Despite risks surrounding the Iran war, artificial intelligence, and delayed Fed rate cuts, Wall Street analysts have remained optimistic about earnings growth, the stock market’s primary driver over the long term. According to FactSet’s John Butters, analysts expect the S&P 500 (^GSPC) to report its sixth consecutive quarter of double-digit earnings growth.
Analysts are expecting the S&P 500 to report double-digit earnings growth for the sixth straight quarter. (Chart: FactSet) · FactSet
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Johnson & Johnson (JNJ) stock dipped in premarket trading on Tuesday
In the first quarter, JNJ reported adjusted earnings per share of $2.70, beating Wall Street estimates of $2.68. Revenue of $24 billion also came in ahead of expectations of $23.6 billion.
The company raised its full-year earnings per share guidance slightly to $11.45–$11.65, with a midpoint in line with estimates.
JNJ said that growth was primarily driven by its cancer drug Darzalex and psoriasis treatment Tremfya, which helped offset an approximate 920 basis point hit to its immunology drug Stelara as new entrants came to market following the expiration of JNJ’s patent.
BlackRock (BLK) stock climbed 2% in premarket trading after the world’s largest asset manager reported its assets under management rose 20% year over year to $13.8 trillion.
Adjusted net income rose 17% to $2.07 billion, and revenue rose 27% to $6.7 billion, topping estimates of $6.4 billion forecast by Wall Street analysts.
Adjusted earnings per share of $12.53 also beat expectations of $11.50, according to S&P Global Market Intelligence.
“BlackRock delivered one of the strongest starts to a year in our history,” BlackRock CEO and Chairman Larry Fink said in the release.
Shares of Fastenal Company (FAST) declined 4% in premarket trading as the maker of industrial fasteners, construction bolts, and custom parts reported growing margin pressure.
The company, which is viewed as a bellwether of the industrial economy, posted earnings that were in line with Wall Street’s expectations.
Goldman Sachs (GS) is kicking off a week of earnings for Wall Street’s biggest banks on Monday, with reports from JPMorgan Chase (JPM), Citigroup (C), Wells Fargo (WFC), Bank of America (BAC), and Morgan Stanley (MS) following on Tuesday and Wednesday.
A growing list of concerns will put their ability to churn out profits to the test. My colleague David Hollerith previews what to expect from their corporate updates this week:
Wall Street analysts are coming into the first quarter earnings season with a dose of optimism.
According to FactSet’s John Butters, the S&P 500 (^GSPC) is expected to report double-digit earnings growth for the sixth quarter in a row. Analysts have upwardly revised their estimates, expecting year-over-year earnings growth of 13.2% for the index.
Still, the quarter brought a series of external events that have altered the business environment and are likely to be discussed on earnings calls:
The big Wall Street banks report quarterly results this week, marking the unofficial start of the Q1 earnings season.
We’ll also be keeping a close eye on a report from streaming giant Netflix (NFLX) as well as results for pharmaceutical maker Johnson & Johnson (JNJ), chip equipment manufacturer ASML Holding N.V. (ASML), and PepsiCo (PEP) later in the week.
