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Highlights from the past week

Market / Macro Economic Summary

Markets continued their positive trajectory as earnings continue to come in and demonstrate a strong economy.  On the week, the S&P 500 rose 1.9%, the Dow Jones Industrial Average gained 2.2% and the tech-heavy Nasdaq notched a 1.1% gain.  Of the five hundred companies in the Standard & Poor’s, 81% are beating estimates by an average of 8%.  More importantly, the guidance during most earnings reports have been to the upside, which bodes well for the remainder of the year.

Company Specific / Micro Economic Summary

Palantir (PLTR)

Shares fell 7% as the stock reported a top and bottom-line primarily due to its impressive run in the last year. Revenues of $634 million grew 21% and exceeded calls for $625 million.  Earnings per share of $0.08 cents were on par with expectations.  Commercial revenue grew in terms of overall percentage of revenue to 24%.  CEO Alex Karp highlighted their success of the over 600 “bootcamps,” or demonstrations, that have allowed prospects to get hands-on time with Palantir’s technology.

Walt Disney (DIS)

Shares fell 10% although they did rebound during the rest of the week. Earnings per share of $1.21 came in well ahead of the estimates of $1.10.  Despite a strong 7% growth in Parks revenue, overall revenue of $22.08 billion came in just shy of Wall Street expectations of $22.11 billion.  CEO Bob Iger said entertainment streaming was profitable on the quarter and should contribute to overall streaming profitability by Q4 of this year.

Celsius (CELH)

Shares started lower 4% but ended the day with a gain of 6%.  Revenues of $355.7 million were an increase of 37% but fell just shy of estimates. The primary reason for the shortfall can be traced back to a Pepsi inventory management issue. Earnings per share of $0.27 were an impressive 39% ahead of the estimates of $0.19 cents.

Uber (UBER)

Shares dropped 5% after the company reported a beat on the top line but an unexpected loss on the bottom-line.  Earnings per share came in at a loss of $0.32 despite the estimated gain of $0.23 cents. Revenue of $10.13 billion slightly nudged ahead of Wall Street analyst calls for $10.11 billion. Uber CEO Dara Khosrowshahi said the one-time loss was due to a “mark to market” write down of its investments in Chinese taxi operator Didi.  

Berkshire Hathaway (BRK.B)

Shares were little changed as the company reported another impressive quarter. In his first ever meeting since the late Charlie Munger’s passing, Warren Buffett reported revenue of $11.22 billion which grew by 39% from a year ago.  Cash levels ballooned to $188 billion despite buying back $2.6 billion in stock.

Unity Software (U)

Shares fell 5% early Friday after recording an unexpected higher first-quarter loss, while the gaming software company projects its strategic portfolio revenue to decline annually for the ongoing period. Revenue hit $460.38 million, beating analysts’ expectations of $433.5 million, but was an 7% decline over last year.

Enbridge (ENB)

Shares increased 1% on the back of a good quarter. Earnings per share of $0.92 exceeded the estimated $0.85 and reflected an 8% increase year-over-year. Revenue of $1.955 billion surpassed the estimates of $1.726 billion. Greg Ebel, President and CEO said, “We are executing on our strategic priorities and are on track to achieve our full-year EBITDA and DCF per share guidance.”

Arista Networks (ANET)

Shares rose nearly 7% after the provider of networking technology delivered better-than-expected quarterly results driven by AI spending. Revenue of $637.7 million or $1.99 per share was up from the $436.5 million or $1.38 per share in the year-ago quarter.  Management also authorized a $1.2 billion dollar stock buy back program.

British Petroleum (BP)

Shares were unchanged as the company reported a rather uninspiring quarter. Revenues of $50 billion lagged behind estimates of $61.8 billion and declined from the $57 billion reported in the year-ago quarter. Earnings per share of $0.97 missed the Wall Street estimates of $1.03.  CEO Murray Auchincloss noted the firm’s “resilient quarter” and said BP was continuing to simplify its business to deliver $2 billion in cash cost savings by the end of 2026.

Parting Thoughts

We welcome an opportunity to discuss the above detail and wish you much success in the rest of your week!

Regards,

E.Palacios

Erick J.  Palacios, MBA

Wealth/Financial Advisor