Despite the volatility seen this summer, certain stocks are managing to outperform the broader market. Strong second-quarter financial results and positive forward guidance have propelled some stocks ahead of their peers and are leading to big gains for their shareholders. Despite the topsy-turvy nature of the market, the current earnings season has been a strong one.
According to FactSet, with three-quarters of companies listed in the S&P 500 index having reported Q2 financial results, 78% have delivered better-than-expected earnings and 59% have beat Wall Street’s revenue estimates. Right now, Q2 earnings are on track to be the strongest since the fourth quarter of 2021. The strong prints are pushing share prices to new heights.
Here are three stocks to load-up on before autumn arrives.
Eli Lilly (LLY)
Eli Lilly (NYSE:LLY) looks like a strong choice after the pharmaceutical company delivered blowout second-quarter financial results and raised its full-year guidance as sales of its diabetes drug Mounjaro and weight-loss medication Zepbound skyrocket. The company announced EPS of $3.92, which trounced the $2.60 expected among analysts. Revenue of $11.30 billion crushed the $9.92 billion forecast on Wall Street. Sales were up 36% from a year earlier.
The guidance was equally strong with Eli Lilly saying it expects full-year earnings of $16.10 to $16.60 a share, up from previous guidance of $13.50 to $14 a share. Revenue for all of 2024 is forecast at $45.40 billion to $46.60 billion, an increase of $3 billion at both ends of the previous range. Eli Lilly credited the strong results and raised guidance to accelerating sales of Mounjaro and Zepbound.
Zepbound’s Q2 sales totaled $1.24 billion, above the $922 million that analysts anticipated. Sales of Mounjaro amounted to $3.09 billion, more than triple the amount from a year ago.
Costco Wholesale (COST)
Costco Wholesale‘s (NASDAQ:COST) e-commerce strategy is taking off. The warehouse club just reported strong financial results for the month of July, powered by a 20% rise in its online sales. Costco, which is one of the few companies that reports its results on a monthly and quarterly basis, said that it had revenue of $19.30 billion in July, up 7.1% year-over-year.
Foot traffic at the company’s warehouse clubs worldwide rose 6.3% during July. Costco’s e-commerce sales jumped 20.2% in the month, topping the 18.4% growth seen in June. The company has been trying to boost its e-commerce business by improving delivery times and adding options to buy products online and pick them up in store. Costco is scheduled to release its next quarterly earnings report on Sept. 26.
COST stock has risen 50% in the last 12 months. It is a perfect time to load up on the warehouse club before Autumn arrives.
Ralph Lauren (RL)
Among clothing retailers, Ralph Lauren (NYSE:RL) continues to be a standout. The maker of polo shirts has just released second-quarter financial results that beat Wall Street’s forecasts, giving its stock a boost. The company announced EPS of $2.70, which was above the $2.48 consensus forecast of analysts. The profit was a 15% increase from a year earlier. Revenue of $1.50 billion was in line with Wall Street expectations.
The latest results were attributed to several factors, including lower marketing spending and an increase in gross margins due to lower cotton prices and sales of higher-margin clothing items. Ralph Lauren’s Q2 sales and profits also got a lift from the fact that the company is the official outfitter of the U.S. Olympic team that is competing in France this summer. In terms of guidance, Ralph Lauren said that it expects revenue will increase by a low-single-digit percentage this year. Analysts had expected an increase of 2.4%.
RL stock has climbed 25% higher over the past 12 months.
On the date of publication, Joel Baglole held a long position in LLY. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
