Earnings season is the heartbeat of the market - and every day brings fresh signals about where money is flowing.
With each report, we learn not just how companies are performing, but how investors are reacting.
In the Daily Beat, we spotlight the most important earnings moves from the prior session - the winners, the losers, and the reactions that reveal what really matters to the market right now.
Whether itโs a bellwether with broad economic implications or a niche name making waves, we cut through the noise to focus on the setups that matter most.
Here are the latest earnings stats from the S&P 500 ๐
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On Wednesday, the provider of corporate uniforms, Cintas $CTAS, beat its headline expectations. The stock fell in absolute terms, but had a slightly positive reaction score.
The company posted revenues of $2.72B, versus the expected $2.70B, and earnings per share of $1.20, versus the expected $1.19.
We also heard from the world's fifth-largest semiconductor company, Micron Technology $MU, which was punished for smashing its top and bottom line expectations.
They reported revenues of $11.31B, versus the expected $11.22B, and earnings per share of $3.03, versus the expected $2.86.
Now let's dive into the fundamentals and technicals ๐
CTAS snapped a multi-quarter beat streak ๐ป
Cintas had a -0.27% post-earnings reaction, and here's what happened:
Uniform rental and facility services revenue grew 8.1% year-over-year, and gross margins increased by 20 basis points.
The quarterly dividend increased by 15.4%, marking the 42nd consecutive annual increase. They also repurchased nearly $350M worth of shares during the quarter.
In addition to the strong quarter, the management team raised its forward revenue and earnings guidance.
This name has been one of the steadier winners since the lows of the Great Financial Crisis, rallying over 4,000%. However, the secular uptrend has paused over the past year.
The corrective wave began in late 2024, when the stock experienced one of its worst earnings reactions ever, falling over 10% in response to a mixed earnings report.
Now, the price has carved out a textbook distribution pattern. With Wednesday's negative earnings reaction confirming the bearish technicals, we expect the bears to retest the lower bound of the potential top soon.
By failing to rally after a double beat and raise, Mr. Market is telling us loud and clear that he doesn't like the fundamentals of this company at the moment.
So long as CTAS holds above 180, the path of least resistance is sideways for the foreseeable future. A close below that level would shift our bias to the downside.
MU suffered its fourth consecutive negative earnings reaction ๐ป
Micron had a -2.8% post-earnings reaction, and here's what happened:
Revenues increased by 46% year-over-year, and DRAM revenue skyrocketed 69% over the same period.
The data center business reached a record revenue and market share, with HBM, high-capacity DIMMs, and LP server DRAM revenue exceeding $10B, a fivefold increase year-over-year.
In addition to the historic quarter, the management team issued forward guidance that was significantly better than expected.
In Sunday's column of the Weekly Beat, we highlighted this stock, noting the divergence between its technicals and fundamentals. The price is breaking out to new all-time highs, but the market is consistently punishing shareholders for the company's earnings reports.
Wednesday's post-earnings reaction reaffirmed this divergence and our weak conviction in the technical breakout.
This name has been a major laggard compared to its peers for years, and we don't anticipate that will change anytime soon. The market is telling us this company's fundamentals are flawed, and there's no alpha in the stock.
So long as MU holds above 158, the path of least resistance is higher for the foreseeable future. However, we think the price is at high risk of failing to hold this breakout.
Stay safe out there
-The Beat Team
P.S. The biggest moves of 2025 are breaking out in small caps - weโll show you exactly where to position before Wall Street catches on.
