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 S&P 500 earnings moves from the prior session - the winners, the losers, and the reactions that reveal what really matters to the market right now.
Whether itβs 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 π
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After Monday's closing bell, we heard from the $25B producer of beer, wine, and spirits, Constellation Brands $STZ, which beat its headline expectations and had a +0.99 reaction score.
The company posted revenues of $2.48B, beating the expected $2.46B, and earnings per share of $3.38, which met the expectations.
We also received an update from one of the world's largest providers of spices and condiments, McCormick $MKC. They posted a double beat, but suffered a -2.81 reaction score.
In the report, the company delivered revenues of $1.72B, beating the expected $1.71B, and earnings per share of $0.85, exceeding the expected $0.82.
Now let's dive into the fundamentals and technicals π
STZ had its third consecutive positive earnings reaction π₯
Constellation Brands had a +1% post-earnings reaction, and here's what happened:
Despite a 15% year-over-year decline in net sales, operating income rose 171% over the same period. This spike in the bottom line was primarily due to lapping prior-year goodwill impairment and cost optimization in the beer segment.
Modelo Especial remained the #1 U.S. beer brand in dollar sales, but the segment as a whole contracted by 7% year-over-year.
Many were expecting the management team to cut its forward guidance, but the prior guidance was reaffirmed.
Ever since this stock resolved a massive top earlier this year, the price has been in a steady downtrend.
Despite the bearish technicals, Mr. Market has rewarded the company for each one of its earnings reports in 2025. These consistent positive earnings reactions lead us to believe that this downtrend is closer to its end than its beginning.
When we look at the chart, the 2020 low is a logical level for the technical downtrend to conclude. While the price has already fallen by over 50% since last year's all-time high, we believe there's still 20% downside remaining.
We expect STZ to continue trending lower toward 104 for the foreseeable future. If and when the price reaches that level, we expect the buyers to step in.
MKC suffered its worst earnings reaction in 9 quarters π»
McCormick had a -3.9% post-earnings reaction, and here's what happened:
Gross margin contracted by 130 basis points due to higher commodity costs and tariffs.
The consumer segment increased its organic sales by 3.8%, while the flavor solutions segment increased its organic sales by only 1%.
Adding to the disappointing quarter was the management team's poor guidance. They expect sales and gross margin to remain flat next year.
McCormick, like Constellation Brands and many more consumer staple names, is in a world of pain right now. As is typical with bull markets, defensive names like these tend to struggle as investors reach for riskier alternatives.
We believe this quarter's earnings reaction was a warning shot to the bulls in this name. It was a signal that the price is likely to resolve this textbook distribution pattern that has been established over the past few years.
Things aren't looking good for the spice stock...
If and when MKC closes below 60, the path of least resistance will shift from sideways to lower for the foreseeable future.
