The Zacks Analyst Blog Highlights: Triumph Bancorp, Century Aluminum, Boise Cascade, Arch Coal And Oasis Midstream

For Immediate Release

Chicago, IL – April 11, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Triumph Bancorp, Inc. (NASDAQ:TBK) , Century Aluminum Company (NASDAQ:CENX) , Boise Cascade Company (NYSE:BCC) , Arch Coal, Inc. (NYSE:ARCH) and Oasis Midstream Partners LP (NYSE:OMP) .

Here are highlights from Tuesday’s Analyst Blog:

Q1 Earnings to Take Wall Street by Storm: Top 5 Picks

Recent weeks have been dominated by escalating trade hostility between the United States and China and regulation of Big Tech. Starting this week, corporate earnings, revenues and management outlook will determine the future course of the stock market. Analysts are looking for a strong Q1 earnings season, mostly in response to the corporate tax cut policy signed into law last December, and robust economic growth both at home and abroad.

While the highest year-over-year earnings growth is likely to be notched by energy players, materials, construction, industrial products, technology and financials are also expected to contribute handsomely. Thus, for the next few weeks, let us keep an eye on stocks from these sectors that are likely to make the most of the Q1 earnings season. Here, we should also bear in mind that better-than-expected earnings performances generally lead to a rally in the share price, which eventually enthralls almost everyone, right from the top brass to research analysts.

Q1 Earnings to See Double-Digit Gains

Investors are looking forward to the outset of the Q1 earnings season on Apr 12 and 13, when majors like BlackRock, Wells Fargo (NYSE:WFC) and JPMorgan (NYSE:JPM) will be reporting their Q1 numbers, and for the whole of S&P 500 results are expected to be impressive.

Total earnings for the S&P 500 companies are estimated to improve 16% from the same period last year on 7.4% higher revenues. Such an uptick will follow 13.5% earnings growth on 8.5% revenue improvement last quarter, marking the best quarterly performance in more than six years.

The gains are likely to be broad-based, with nearly all the sectors expected to report year-over-year earnings growth, except for autos and conglomerates. Around 11 of these sectors are likely to come up with double-digit growth.

What Will Drive Earnings?

Earnings are likely to rise mostly on Trump’s polices, including tax cuts and solid global economic growth. The latest tax laws gave companies massive tax relief as they will now be paying between 8% and 15.5% instead of the earlier 35% for bringing back money held overseas.

Trump’s economy is also in good shape, with the jobless rate remaining at a 17-year low of 4.1% in March, while workers’ hourly wages rose 8 cents, or 0.3%, to $26.82 in the month. The United States at the same time added an average of 202,000 jobs a month in Q1, faster than the average gains in the same period of 2017 and 2016. U.S. consumer sentiment in March, by the way, reached its highest level since 2004, courtesy of a healthy job market.

The global economy too is estimated to expand at a rate of 3.1% year over year in 2018. This comes on top of a promising 3% growth rate in 2017, per the World Bank.

Potential Gainers of Q1

The energy sector is poised to report highest earnings growth among all sectors, which is estimated to surge 60.3% from the same period last year on 15.6% higher revenues. Among the sub-sectors, oil and gas exploration and production; oil and gas refining and marketing; oil and gas equipment and services; and oil and gas drilling companies are positioned to report solid growth. A healthy crude pricing scenario and positive free cash flow are primarily backing the optimism.

The materials sector has recently been looking up, with Q1 earnings expected to rise 41.4% on 20.2% higher revenues. Construction is likely to report the third-highest year-over-year profit growth, with Q1 earnings poised to be up 36.1% from the same period last year on 15.9% higher revenues.

Earnings for the Industrial sector are set to grow 23.9% from the same period last year on 12.3% higher revenues. Firm business investment helped factories expand at a record pace. Manufacturers are also on a hiring spree and are paying more than other jobs.

Some analysts, in the meantime, are worried that investors will start to rotate out of the crowded tech sector this year and into other sectors that will benefit from the lower taxes. So far though, in spite of such uncertainty, the technology sector outperformed the broader S&P 500. In fact, Q1 earnings for the tech sector are poised to be up 20.7% from the same period last year on 11.4% higher revenues.

High profits are also expected from financial segments as well. Total Q1 earnings for the financial sector are projected to rise 19.1% from the same period last year on 4.5% higher revenues. Banks, insurers and asset managers are all expected to report double-digit growth mostly on heightened volatility and higher interest rates (read more: Zacks Investment Research

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Written By: Zacks Investment Research