- Several stocks are rallying on the back of rising profit estimates, including three from the “Magnificent Seven”.
- These include Nvidia (NVDA), Alphabet (GOOGL), and Amazon.com (AMZN), all of which have seen analysts raise their consensus profit estimates.
- Outside of the Magnificent Seven, Pinterest (PINS) is also seeing a surge in its stock price, underpinned by rising profit estimates.
Analysts’ rising profit estimates are fuelling a rally in several stocks, including those of Nvidia, Alphabet, and Amazon. This article delves into the details of these surges and what they mean for investors.
Rising Profit Estimates As Nvidia Sets Up Ahead Of Earnings
Nvidia is currently in a consolidation phase with a buy point of 974. Analysts are predicting an 84% increase in profits for the current fiscal year and a 21% increase for the next. The company is set to report its April-quarter results on May 22, with sales expected to grow 242% to $24.6 billion. Earnings estimates of $5.20 per share indicate a 473% increase from the prior year. Nvidia boasts an ideal EPS Rating of 99.
Alphabet and Amazon Also Rallying on Rising Profit Estimates
Google parent Alphabet is also experiencing a rally, partly due to rising profit estimates. Shares saw a significant increase after first-quarter results exceeded estimates on April 26. The stock is currently extended from a 153.78 buy point. For the full year, analysts predict earnings of $7.78 per share, marking a 35% increase. Alphabet holds a near-ideal EPS Rating of 98.
Amazon is also seeing a surge in its stock price as analysts expect higher profits in the current and next year. For this year, the consensus estimate is for earnings to grow 74% to $5.03 per share, rising 25% more next year to $6.30 a share. Amazon’s EPS Rating stands at 81.
Pinterest Breaks Out of Cup Base
Outside of the Magnificent Seven, Pinterest is attempting to break out of a cup base with a buy point of 41.60. The crafts marketplace reported first quarter results on April 30, with both sales and earnings growth accelerating. Sales grew 23% to $740 million, while earnings of 20 cents per share were 150% higher than the year-ago period. Its relative strength line is at a 52-week high, a bullish sign. Rising profit estimates underpin the stock’s action. For 2024, earnings are seen rising 33% to $1.45 per share, while for 2025 analysts expect 23% growth to $1.79 per share.
Conclusion
Rising profit estimates are a powerful tailwind for a stock rally. This is evident in the current performance of stocks like Nvidia, Alphabet, Amazon, and Pinterest. Investors should keep a close eye on these stocks as they continue to show promising growth.
