We’re nearing the end of earnings season, but the action hasn’t slowed down.
Last week brought a mix of surprises — a grocery chain ripped higher, a semiconductor giant was punished for a double beat, and a cruise line delivered one of its best quarters ever.
This week, however, things are shifting.
It’s shaping up to be one of the quietest stretches of the year for earnings, with just a few companies set to report.
With fewer new catalysts, our focus will shift to reviewing the most important reactions of the season and identifying the names that show the strongest trends as we head into Q3 of 2025.
In this week’s recap, we'll cover the biggest takeaways from last week and preview the setups we’re watching next.
Kroger $KR reported mixed results and rallied nearly 10% on the news. E-commerce sales grew 15% year-over-year, which management called the "best profit improvement yet on a quarter-over-quarter basis" for the segment.
Accenture $ACN beat its top and bottom-line expectations, but sank 6.9% in response to it. The new Washington D.C. administration's cost-cutting initiatives have created significant challenges for the company's U.S. Federal Contracting segment.
FactSet Research Systems $FDS reported mixed results and jumped 3.5% in reaction to it.
Earlier this month, the company announced that Sanoke Viswanathan will become the new CEO in September. The market has treated him with a warm welcome.
Carnival $CCL reported a double beat and rallied nearly 7% on the news. Adjusted net income more than tripled year-over-year, and the management team raised guidance across the board.
McCormick $MKC reported a double beat and soared 5.3% on the back of it. Despite cost pressures, the company delivered 10% adjusted operating income growth.
Micron $MU beat its top and bottom-line expectations and fell 1% following the report. They reported record revenue of $9.30 billion, representing 15% sequential growth and 37% year-over-year growth.
What's happening next week 👇
Next week will be one of the quietest of the year with respect to new earnings reports.
We'll hear from a few penny stocks, Greenbrier $GBX, Progress Software $PRGS, Unifirst $UNF, and MSC Industrial Direct $MSM.
The most notable report next week is from Constellation Brands $STZ.
After the closing bell on Tuesday, the market expects the company to report revenues of $2.55 billion and earnings per share of $3.31.
The $28.5B producer of alcoholic beverages is trading at a key shelf of former lows.
Here's the STZ setup ahead of Tuesday's earnings event 👇
Constellation Brands is trading near its lowest level since 2020.
This is one of the most dominant players in the U.S. alcohol industry.
They own a powerhouse portfolio of premium beer, wine, and spirits brands, including Modelo, the #1 beer in America, as well as Corona, Pacifico, The Prisoner, and High West Whiskey.
Beer is the backbone of the business, accounting for the vast majority of total revenue.
And the growth isn't slowing... Modelo Especial just overtook Bud Light as the top-selling beer in the country, fueling continued volume and pricing gains.
While the wine and spirits portfolio has been in a multi-year transition, management has refocused on higher-margin brands.
That effort is starting to pay off, and the market will be focused on these numbers in the report.
At the same time, the company has cleaned up its balance sheet, reduced its debt, and aggressively repurchased shares.
The stock has been punished for 3 of its last 4 earnings reports, so expectations are subdued heading into Tuesday’s print.
STZ is trading at a key shelf of former lows from earlier this year, around 160.
If the bears can knock the price below this level, we'll likely see a fresh leg lower.
However, if the bulls can hold the line, we'll likely see a rally back to the 200s.
We’ll be closely watching how the market responds on Wednesday.
While we're talking about the Consumer Staples sector, let's check in on what the "best fundamental analyst on Wall Street" thinks about stocks.
This ratio is telling us to buy stocks 👇
One of the best fundamental analysts on Wall Street isn’t a person... It’s a chart.
We’re talking about the Discretionary vs. Staples ratio $XLY / $XLP.
When consumers are confident, they tend to spend on non-essentials, such as cars, clothes, and travel.
When they’re cautious, they tighten up and stick to the basics, such as beer, cigarettes, and groceries.
In good times, this line goes up.
Currently, it's breaking out of a textbook bearish-to-bullish reversal pattern and pushing to new multi-month highs.
This is a fundamental vote of confidence from the market.
If the breakout holds, it suggests risk appetite is alive and well.
It's also a signal for us to buy more stocks.
Thank you for reading.
- The Beat Report Team
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