We’re moving deeper into the second-quarter earnings season, which means Wall Street is getting busier, too.
The good news is earnings are definitely working, which is bad news for the companies that miss analysts’ estimates.
Case in point: Domino’s Pizza, Inc. (NYSE:DPZ).
The company reported a mixed second quarter last Thursday. For the quarter, earnings declined nearly 10% year-over-year to $2.82 per share, which was just short of analysts’ expectations for earnings of $2.90 per share. Revenue increased about 4% to $1.07 billion. However, same-store sales slipped 2.9% and international same-store sales dropped 2.2%.
Company management commented, “We continued to navigate a difficult labor market, especially for delivery drivers, in addition to inflationary pressures combined with COVID and stimulus-fueled sales comps from the prior two years in the U.S.”
Following the weak results, DPZ shares fell about 2% on significantly above-average volume.
The reason why I’m talking to you about Domino’s Pizza today is because the uptick in sell volume coupled with the company’s dwindling fundamental health dropped DPZ to a D-rating in Portfolio Grader over the weekend. As a result, this stock is now a Sell. However, that’s not the only stock that was downgraded this weekend. After taking a close look at the latest data on institutional buying pressure and each company’s fundamental health, I decided to revise my Portfolio Grader recommendations for 84 big blue chips – 13 of those stocks (including Domino’s Pizza) were downgraded to Sells.
You can get a quick peak at the first 10 of the 13 companies that were downgraded to Sells in the chart below. I should also add that 53 stocks were upgraded from a Hold (C-rating) to a Buy (B-rating). Chances are that you have at least one of these stocks in your portfolio, so you may want to give this list a skim and act accordingly. For the full list of 84 stocks, click here.
|Ticker||Company Name||Total Grade|
|CHWY||Chewy, Inc. Class A||D|
|CMG||Chipotle Mexican Grill, Inc.||D|
|DPZ||Domino’s Pizza, Inc.||D|
|EXPE||Expedia Group, Inc.||D|
|JHX||James Hardie Industries PLC Sponsored ADR||D|
|SIVB||SVB Financial Group||D|
|SNOW||Snowflake, Inc. Class A||D|
|VALE||Vale S.A. Sponsored ADR||D|
|VZ||Verizon Communications Inc.||D|
|YUMC||Yum Chinas Holdings, Inc.||D|
Before you go, I want to remind you that I will be revealing my latest project on Thursday, July 28, at 4 p.m. Eastern time. It could rapidly increase your wealth and put real cash in your pockets to help keep you ahead of the sky-high inflation. Click here for more details.
The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:
Expedia Group, Inc. (EXPE)