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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Before Thursday's opening bell, we heard from the $198B producer of Pepsi and Cap'n Crunch, PepsiCo $PEP, which beat its headline expectations and had a +3.33 reaction score.
The company posted revenues of $23.94B, beating the expected $23.84B, and earnings per share of $2.29, exceeding the expected $2.26.
We also received an update from one of the world's largest airlines, Delta Air Lines $DAL. They posted a double beat, and shareholders were rewarded with a +1.62 reaction score.
In the report, the company delivered revenues of $15.20B, beating the expected $15.08B, and earnings per share of $1.71, exceeding the expected $1.53.
Now let's dive into the fundamentals and technicals π
PEP had its second consecutive positive earnings reaction π₯
PepsiCo had a +4.2% post-earnings reaction, and here's what happened:
Despite a 3% year-over-year increase in revenue, net income declined by 11% over the same period.
The well-known activist investment firm Elliott Investment Management recently took a significant stake in the company. So far, the company has been implementing its recommendations in its turnaround plan.
The positive reaction was fueled by better-than-expected forward guidance from the management team.
We highlighted this earnings report in the latest column of the Weekly Beat, pointing out that despite a recent deceleration in earnings, the stock had its best earnings reaction of the 21st century last quarter.
When the bears fail to knock the price down on bad news, it's clear that the bulls are looking ahead to the future. In this case, the market is anticipating that the company's turnaround plan will work.
With another positive earnings reaction this quarter, the bulls are beginning to build some momentum.
However, the price is still below the neckline of a massive distribution pattern, so the downside risk is elevated.
Until PEP reclaims 154, the path of least resistance is likely to remain sideways to lower for the foreseeable future. A close above that level would shift our bias to the upside.
DAL had its fourth consecutive positive earnings reaction π₯
Delta Air Lines had a +4.3% post-earnings reaction, and here's what happened:
The company posted record quarterly revenue, up 6% year-over-year, driven by the premium, corporate, and loyalty segments.
With all of this cash coming in the door, the board authorized a $1B share repurchase program through June 2028.
Adding to the great quarter, the management team expects its next quarterly results to be at the upper end of its prior guidance range.
This is another report we highlighted in the latest column of the Weekly Beat, noting that the past three earnings reactions have been among the best ever.
While this quarter's reaction wasn't quite as strong, it was still positive. The stock extended its beat streak to four consecutive quarters.
Technically, this post-earnings move decisively resolved a multi-week tight volatility compression. Now, the volatility is expanding to the upside, and we believe it's likely to push the price to new all-time highs before the end of 2025.
We expect the path of least resistance for DAL to remain higher for the foreseeable future.
