Magnificent Seven stocks Nvidia, Amazon.com, Meta Platforms and Alphabet are again carrying the load for the S&P 500.
The four companies should be among the top five contributors of second-quarter earnings growth in the S&P 500, says a report from FactSet.
These Magnificent Seven names are forecast to report combined 56.4% year-over-year second-quarter earnings growth, according to FactSet. This wallops the 5.7% blended profit growth rate expected for the remaining 496 companies in the S&P 500. The blended rate combines actual and estimated results. Even more dramatic was the quartet's first-quarter aggregate earnings growth: 131.8% vs. a 1.2% drop for the other 496 companies.
These four Big Tech companies are forecast to report combined 28.4% year-over-year earnings growth for the third and fourth quarters of 2024. Meanwhile, the other 496 should produce a modest 5.2% in Q3 then 15.6% in Q4.
The collective group of S&P 500 companies are projected to report a 9.7% earnings growth for the second quarter, according to FactSet. That would be the highest year-over-year growth rate since the fourth quarter of 2021, when earnings jumped 31.4%.
About 14% of the S&P 500 companies had reported second quarter results through Friday. And 80% of them topped earnings expectations, with a 5.5% combined beat, says John Butters, Senior Earnings Analyst at FactSet Research Systems. This lags the 8.6% beat of the five-year average.
Magnificent Seven Leader Nvidia Profit Growth Tops Them All
FactSet's consensus earnings estimate for Nvidia's Q2 is an increase of 137% to 64 cents a share. Nvidia has been an earnings powerhouse over the last four quarters, with growth ranging from 440% to 567%.
Nvidia stock has gained 149% so far this year. The leading artificial intelligence stock is climbing back after two sell-offs since June 20. The AI stock gained 4.76% Monday and reclaimed its 10-week moving average. Support at the 10-week line offers an add-on buy range from around 121.40 up to 127.50.
Amazon, Meta Platforms, Alphabet See Big Earnings
Magnificent Seven retailer Amazon.com is expected to report $1.02 per share in the second quarter, or 57% growth. The stock gave back gains from a breakout and is back below the 191.70 buy point of a flat base as well as its 50-day line, according to IBD MarketSurge pattern recognition.
Analysts see Meta Platforms' second-quarter profit jumping to $4.70 per share vs. $2.98 in Q2 2023. Meta stock rose 2.2% Monday making it three straight days of gains. The stock is testing its 50-day line after sinking below it in a five day sell-off that began July 11. Shares have fallen as much as 11% from a 514.01 buy point.
Alphabet earnings estimates show $1.83 per share, up 27%. Google stock jumped 2.3% Monday as it bounced off its 50-day line. The Magnificent Seven stock is in the buy zone up to 184.13 from a bullish three-weeks-tight pattern with a 178.77 entry.
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