Barclays surpassed earnings estimates in each of the past four quarters. The UK banking giant most recently delivered first-quarter earnings back in April of $0.65 per share, which represented a 6.6% surprise over the Zacks Consensus Estimate. An increase in revenues driven by solid investment banking performance aided the results.
Barclays has delivered a trailing four-quarter average surprise of 30.2%. Consistently beating earnings estimates is a recipe for success.
Analysts covering BCS have raised their full-year EPS estimates by 10.4% in the past 60 days. The 2025 Zacks Consensus EPS Estimate now stands at $2.23 per share, translating to growth of 21.2% relative to last year.
This market leader has seen its stock advance nearly 30% already this year, all while the general market witnessed a drastic correction. Only stocks that are in extremely powerful uptrends are able to experience this type of outperformance. This is the kind of stock we want to include in our portfolio – one that is trending well and receiving positive earnings estimate revisions.
Notice how both the 50-day (blue line) and 200-day (red line) moving averages are sloping up. The stock has been making a series of higher highs throughout the past year. With both strong fundamental and technical indicators, BCS stock is poised to continue its outperformance.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. As we know, BCS has recently witnessed positive revisions. As long as this trend remains intact (and Barclays continues to deliver earnings beats), the stock will likely continue its bullish run.
Backed by a leading industry group and history of earnings beats, it’s not difficult to see why BCS stock is a compelling investment. Robust fundamentals combined with an appealing technical trend certainly justify adding shares to the mix.
Barclays has been rewarding shareholders with enhanced capital distributions. The company intends to keep the total dividend payout stable with progressive dividend growth. Barclays plans to return at least £10 billion of capital to shareholders between 2024 and 2026 through dividends and share buybacks.
Recent positive earnings estimate revisions should also serve to create a ‘floor’ in terms of any sudden or unexpected downside moves. If you haven’t already done so, be sure to put BCS on your shortlist.
J&J Snack Foods manufactures, markets, and distributes snack food and beverages to the food service and retail supermarket industries in the United States, Canada, and Mexico. Known for its SuperPretzel soft pretzels and ICEE frozen drinks, the company offers a variety of bakery products such as fig and fruit bars, cookies, donuts, churros, and muffins.
Incorporated in 1971 and headquartered in Mount Laurel, New Jersey, J&J Snack Foods also sells machines and machine parts to other food and beverage companies. It markets its products through department stores, fast food and casual dining restaurants, theme parks, convenience stores, movie theaters, and independent retailers.
The company faces several headwinds amid a challenging operating environment. A modest revenue base provides the company less fixed cost leverage and fewer distribution channels relative to larger competitors. Estimated sales growth of less than 2% for the current fiscal year implies a slowdown from recent trends.
A Zacks Rank #5 (Strong Sell) stock, J&J Snack Foods is a component of the Zacks Food – Miscellaneous industry group, which currently ranks in the bottom 43% out of approximately 250 Zacks Ranked Industries. As such, we expect this industry group as a whole to underperform the market over the next 3 to 6 months, just as it has over the past year.
Stocks in the bottom tiers of industries can often be intriguing short candidates. While individual stocks have the ability to outperform even when they’re part of a lagging industry, the inclusion in a weaker group serves as a headwind for any potential rallies and the journey forward is that much more difficult.
JJSF shares have been underperforming over the past year. The stock is hitting a series of lower lows and represents a compelling short opportunity as we head further into 2025.
J&J Snack Foods has fallen short of earnings estimates in each of the last four quarters. Just last week, the company reported fiscal second-quarter earnings of $0.35 per share, missing the Zacks Consensus Estimate by a whopping -49.3%. J&J Snack Foods has posted a trailing four-quarter average earnings miss of -28.1%.
A drop in volume across larger segments like churros and pretzels dented first-quarter sales, causing a sharp drop in gross profit. Falling short of earnings estimates is a recipe for underperformance, and JJSF is no exception.
The company has been on the receiving end of negative earnings estimate revisions as of late. Looking at the current quarter, analysts have slashed estimates by -12.06% in the past 60 days. The fiscal Q3 Zacks Consensus EPS Estimate is now $1.75 per share, reflecting negative growth of -11.6% relative to the year-ago period.
Falling earnings estimates are a huge red flag and need to be respected. Negative growth year-over-year is the type of trend that bears like to see.
JJSF stock is in a sustained downtrend. The stock has made a series of lower lows, widely underperforming the major indices. Also, its shares are trading below 50-day and 200-day moving averages – another good sign for the bears.
JJSF stock has experienced what is known as a “death cross,” whereby the stock’s 50-day moving average crosses below its 200-day moving average. Shares would have to make an outsized move to the upside and show increasing earnings estimate revisions to warrant taking any long positions. The stock has fallen more than 20% this year alone.
A deteriorating fundamental and technical backdrop show that this stock is not set to make its way to new highs anytime soon. The fact that JJSF is included in one of the worst-performing industry groups provides yet another headwind to a long list of concerns.
A history of earnings misses and falling future earnings estimates will likely serve as a ceiling to any potential rallies, nurturing the stock’s downtrend.
Potential investors may want to give this stock the cold shoulder, or perhaps include it as part of a short or hedge strategy. Bulls will want to steer clear of JJSF until the situation shows major signs of improvement.
The Boeing Co. recently secured a contract from China Airlines to deliver 10 777-9 passenger and four 777-8 Freighter airplanes. Additionally, the airline has options to purchase five 777-9s and four 777-8 Freighter jets.
With global customers having ordered more than 520 777X airplanes to date, Boeing’s proven prowess in the commercial aerospace market is further strengthened, ensuring its long-term revenue stability. This, in turn, might encourage investors interested in aerospace stocks to add this American jet manufacturer to their portfolio.
However, before adding a stock to one’s portfolio, one must consider other parameters like share price performance, opportunities as well as risks (if any) to investing in the same.
Shares of Boeing have surged 12% over the year-to-date period, outperforming the S&P 500’s loss of 4.4%. The stock also beat theZacks aerospace-defense industry’s rise of 10.8% and the broader Zacks Aerospace sector’s growth of 9.7% in the said time frame.
Shares of other aerospace bigwigs like Embraer and Airbus have also risen considerably over the year-to-date period. Notably, shares of Embraer and Airbus have gained 31% and 10.5%, respectively.
This aerospace manufacturer has been making headlines since the beginning of the year, driven by a series of contract wins across both commercial and defense sectors, as well as several valuable partnership agreements. Together, these developments (expected to strengthen the company’s resilience during periods of economic or geopolitical uncertainty) must have reinstated investors’ confidence in BA, which got duly reflected in its year-to-date share price hike.
Notably, Boeing began its 2025 media account with the announcement of a strategic partnership with Norsk e-Fuel in January, which enables it to invest in the production and availability of sustainable aviation fuel (SAF). In the next month, Boeing secured an order from the Japan Self-Defense Forces for the supply of 17 CH-47 Block II Chinook helicopters.
In March, Japan Airlines offered a contract to Boeing to deliver 17 of its 737-8 jets, and BOC Aviation issued an order for the supply of 50 737-8 jets. In April, Boeing signed an agreement to sell portions of its Digital Aviation Solutions business, including its Jeppesen, ForeFlight, AerData and OzRunways assets, to Thoma Bravo for cash worth $10.55 billion.
Rising air travel and an aging global fleet are driving demand for new jets and aftermarket services, which likely contributed to Boeing Global Services (BGS) unit generating a solid $5.1 billion in revenues in the first quarter of 2025. Future growth for Boeing in this market looks promising, with the company’s upcoming aircraft offering 25-40% better fuel efficiency and lower emissions. With a strong $22.04 billion backlog, as of March 31, 2025, the BGS unit is well-positioned for sustained long-term expansion.
In fact, the rapidly growing commercial air travel also bodes well for other aerospace giants like Embraer and Airbus, both of which actively serve the commercial aftermarket services market through their Embraer Services & Support and Airbus Services units, respectively.
Boeing’s long-term defense outlook also remains strong, supported by rising U.S. defense spending and major program involvement, such as the F-47 Next Generation Air Dominance platform. In the first quarter of 2025, its defense unit secured $4 billion in contracts, taking the backlog to $61.57 billion. Continued innovation, evident from its progress on the MQ-25 program, and strong government support signal strong growth potential for Boeing’s defense offerings in the years ahead.
In line with this, the consensus estimate for BA’s long-term (three-to-five years) earnings growth rate is pegged at 17.9%, higher than the industry’s 11.5%.
Now, let’s take a sneak peek at the company’s near-term estimates to understand whether the figures mirror similar growth prospects.
Boeing’s estimate for second-quarter 2025 sales suggests an improvement of 18.4% from the year-ago quarter’s reported figure, while that for full-year 2025 sales indicates a rally of 25.7%. A similar improvement trend can be observed from its 2026 sales estimates.
Its quarterly as well as yearly earnings estimates also reflect similar robust performance on a year-over-year basis.
Additionally, an upward revision has been observed in the company’s near-term earnings estimates over the past 60 days. This indicates that investors are gaining confidence in the stock’s earnings-generating capabilities.
While Boeing offers strong growth prospects, it also faces significant challenges that could affect its operational performance, which investors should carefully consider before investing in the stock. Although the commercial aerospace market has been benefiting from steady growth in air travel in recent times, persistent supply-chain issues, particularly those arising from a shortage of aircraft parts, continue to affect the global aviation industry. This, in turn, poses a significant risk for aircraft manufacturers, such as Boeing, Embraer and Airbus.
Looking ahead, persistent supply-chain issues are expected to continue to play the role of a primary growth inhibitor in the commercial aviation industry this year as well. Moreover, the recently imposed tariffs by the U.S. administration on imported goods might exacerbate the global supply-chain turmoil, resulting in delays in acquiring parts needed for Boeing’s jet production. This might increase Boeing’s production costs and strain its production timelines, creating uncertain challenges for the jet giant in maintaining its delivery schedules. This, in turn, might hurt its financial position.
The image below shows that BA stock’s trailing 12-month return on invested capital (ROIC) not only lags the peer group’s average return but also reflects a negative figure. This suggests that the company's investments are not yielding sufficient returns to cover its expenses.
However, the ROIC of its peers, Embraer and Airbus, is currently better than that of Boeing. While ERJ’s ROIC is currently 14.24, that of EADSY is 4.71.
In terms of valuation, RTX’s forward 12-month price-to-sales (P/S) is 1.69X, a premium to its peer group’s average of 1.66X. This suggests that investors will be paying a higher price than the company's expected sales growth compared to that of its peer group. The stock’s forward 12-month P/S also seems stretched when compared to its five-year median value, 1.40.
To conclude, investors interested in Boeing should wait for a better entry point, considering the stock’s poor ROIC and premium valuation. BA currently has a VGM Score of F, which is also not a very favorable indicator of strong performance.
However, those who already own this Zacks Rank #3 (Hold) stock may continue to do so, considering its recent share price hike, solid sales and earnings growth potential as well as upward revision in near-term earnings estimates. You can seethe complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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The Boeing Company (BA) : Free Stock Analysis Report
Embraer-Empresa Brasileira de Aeronautica (ERJ) : Free Stock Analysis Report
Barclays PLC (BCS) : Free Stock Analysis Report
J & J Snack Foods Corp. (JJSF) : Free Stock Analysis Report
Airbus Group (EADSY) : Free Stock Analysis Report
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