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Q2 Earnings Continue

Zacks Equity Research

Ahead of today’s opening bell, the Federal Trade Commission (FTC) has issued a verdict on Facebook’s FB privacy violations. The commission has levied a $5 billion settlement on the social media giant, as well as demanding some structural changes to the reporting of compliance to the FTC.

CEO Mark Zuckerberg will need to certify his company is adhering to privacy protections as per the FTC’s decision on a quarterly basis. Not doing so, it is reported, may result in civil or criminal penalties. The $5 billion fine was described as “unprecedented” in the history of the FTC.

Yesterday, Existing Home Sales fell 90K month over month, beneath estimates, to 5.27 million seasonally adjusted, annualized units, for the month of June. New Home Sales for June will be reported today after the bell. Analysts expect this total to rise to 658K from the 626K reported last month.

Q2 Earnings Update

Boeing Co. BA beat estimates this morning on its Q2 bottom line by a wide margin — $2.92 per share versus $1.85 expected. However, this is well below the $3.33 per share reported in the year-ago quarter. Revenues of $15.75 billion in the quarter also disappointed, missing the Zacks consensus by 12.4%. It’s also well beneath the $24.26 billion reported a year ago.

Clearly, the problems with the company’s 737 MAX, which has crashed twice in recent months, is largely responsible for the big pullback in company sales and earnings. The company has been responsive to its shareholders by delivering guidance more in-line with the realities of these difficulties. As a result, the stock has gained 15.7% year to date, though is well off its all-time highs reached earlier this year, before the 737 MAX issues. For more on BA’s earnings, click here.

Caterpillar CAT also underperformed in its Q2 report in today’s pre-market, posting $2.83 per share versus $3.12 per share expected, and down from the $2.97 per share a year ago. Revenues of $14.43 billion was 0.64% beneath the Zacks consensus. Shares are down more than 5% in today’s pre-market, giving back more than half the farm machinery giant’s gains year to date. For more on CAT’s earnings, click here.

AT&T T came in-line with estimates at 89 cents per share, beneath the 91 cents reported in the year-ago quarter. Revenues were also in-line at $44.96 billion, up from $38.99 billion reported a year ago. AT&T, which is still in the process of funneling in its content acquisitions — and may look like a very different company in the quarters to come — is still underperforming the S&P 500 by 7.5% year to date. For more on T’s earnings, click here.

Logistics and transportation major United Parcel Service UPS beat the Zacks consensus by 3 cents to $1.96 per share, and 2 cents above the year-ago quarter. Revenues of $18.05 billion topped estimates by 0.51% and above the $17.46 billion reported in Q2 2018. Shares are up more than 5% in the pre-market following the earnings report. For more on UPS’ earnings, click here.


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