5 Stocks that Crushed Earnings Expectations

In this article, we discuss the 5 stocks that crushed earnings expectations. If you want to read our detailed analysis of these companies, go directly to the 10 Stocks that Crushed Earnings Expectations.

5. Brookfield Asset Management Inc. (NYSE: BAM)

Number of Hedge Fund Holders: 34

Brookfield Asset Management Inc. (NYSE: BAM) swung to a profit in the second quarter. The asset management company reported earnings of 49 cents per share for the three months ended June 30, compared to a loss of 43 cents per share in the same period last year.

Revenue came in at $18.29 billion, translating to a surge of 42 percent from $12.83 billion in the year-ago quarter. In addition, Brookfield Asset Management Inc. (NYSE: BAM) announced a quarterly dividend of 13 cents per share.

Commenting on the results, CEO Nick Goodman said, “Our business performed very well during the quarter, recording $1.2 billion of distributable earnings. Growth in our asset management franchise, steady returns on our principal investments, and continued momentum on our capital recycling initiatives all contributed to the strong quarter. Subsequent to quarter-end, we held the first close of $9 billion for our fourth flagship real estate fund, and our $7 billion founders’ close for our Global Transition Fund, taking total fundraising since last quarter to $24 billion. We expect the size of these two funds to exceed $30 billion before they close for capital.”

In the Q2 2021 investor letter of Baron Funds, the fund mentioned Brookfield Asset Management Inc. (NYSE: BAM). Here is what the fund said:

“The shares of long-term holding Brookfield Asset Management Inc. gained 15% in the most recent quarter. The company is a leading alternative asset manager focused on investing in high-quality real estate and infrastructurerelated assets that tend to generate predictable and growing cash flows. We remain bullish about the ongoing prospects for Brookfield given the secular growth opportunity for alternative assets, the company’s many competitive advantages including scale, global capabilities, its well known brand name, operating expertise, and performance track record. We hold management in high regard and believe the shares remain attractively valued.”

4. Airbnb, Inc. (NASDAQ: ABNB)

Number of Hedge Fund Holders: 52

The travel industry has recovered amid mass vaccination and ease in mobility restrictions. As a result, many people traveled across the world after countries opened their borders. The trend benefitted companies associated with the travel and tourism industry.

Airbnb, Inc. (NASDAQ: ABNB) was also among the top beneficiary of the trend. The company recently announced record revenue for the second quarter. The online marketplace for lodging reported a loss of 11 cents per share, well below a loss of $2.18 per share in the year-ago quarter. Analysts, on average, were looking for a loss of 36 cents per share.

Revenue for the quarter skyrocketed approx. 300 percent on a year-over-year basis to $1.3 billion, beating the consensus forecast of $1.26 billion. The solid quarterly performance was mainly driven by higher bookings during the quarter. Q2 gross booking value jumped to $13.4 billion, exceeding estimates of $11.56 billion.

Speaking on the results, CEO Brian Chesky said, “We’re proud of our strong results this quarter, which again surpassed 2019 revenue levels. Travel is different than before, and because of our adaptable business model and continued product innovation to meet the changing needs of our guests, Airbnb is leading the travel rebound.”

In the Q2 2021 investor letter of Worm Capital, the fund mentioned Airbnb, Inc. (NASDAQ: ABNB). Here is what the fund  said:

“Throughout the quarter, you may have noticed that we averaged into a significant position in Airbnb (ABNB). Though the stock has been a relative underperformer since its February highs, we are highly confident about the company’s prospects and its ability to generate meaningful compounded returns over time.

Some history: We have been following Airbnb’s journey for several years, long before the company went public earlier this year. (In fact, nine years ago, in November 2012, Eric profiled the company for Inc.: “Airbnb Is Changing Travel.”)…” (Click here to see the full text)

3. Walmart Inc. (NYSE: WMT)

Number of Hedge Fund Holders: 58

Shares of Walmart Inc. (NYSE: WMT) are trading near their 52-week high after the world’s largest grocery chain announced better-than-expected financial results for the second quarter. The company reported adjusted earnings of $1.78 per share for the three months ended July 31, crushing analysts’ average estimate of $1.57 per share.

Revenue for the quarter rose nearly 6 percent to $141.04 billion, ahead of the consensus forecast of $137.02 billion. U.S. comparable sales in the quarter jumped 9.3 percent, while e-commerce sales climbed 97 percent.

Walmart also released its financial outlook for the third quarter. It expects adjusted earnings in the range of $1.30-$1.40 per share for the current quarter, in line with the consensus forecast of $1.32 per share. Moreover, U.S. comparable sales are expected to grow in the range of 6-7 percent, better than a 3.7 percent growth suggested by analysts.

2. The Home Depot, Inc. (NYSE: HD)

Number of Hedge Fund Holders: 68

Home Depot, Inc.’s (NYSE: HD) history dates back to 1978 when Bernard Marcus and Arthur Blank created the company with a goal to establish a hardware store chain with a complete range of merchandise and highly trained staff. The company initially started its operations by opening two stores in Atlanta in 1979. Since then, its store count has climbed to 2,300, helping it become a leading player in the home improvement space.

The company on Tuesday announced its Q2 profit and sales above expectations. The home improvement retailer reported earnings of $4.53 per for the quarter ended August 1, up from $4.02 per share in the comparable period of 2020.

Revenue came in at $41.1 billion, up 8.1 percent from the year-ago quarter. The results easily surpassed analysts’ average estimate of $4.43 per share for earnings and $40.73 billion for revenue.

CEO Craig Menear praised the latest quarterly performance. Menear said in a statement, “I am very proud of our associates, who continue to demonstrate a relentless focus on serving our customers. As a result of their efforts, we achieved a milestone of over $40 billion in quarterly sales for the first time in Company history. I would like to extend my sincere appreciation to our team, as well as our supplier and supply chain partners, as they continue to operate in this dynamic and challenging environment.”

1. The Walt Disney Company (NYSE: DIS)

Number of Hedge Fund Holders: 134

Disney (NYSE: DIS) is best known for providing family entertainment around the world. The company recently announced strong financial results for the third quarter ended July 3. Disney reported earnings of 50 cents per share, a substantial improvement from a loss of $2.61 per share in the comparable period of 2020.

On an adjusted basis, the company earned 80 cents per share, beating the consensus forecast of 55 cents per share. Revenue came in at $17.02 billion, well above $11.78 billion in the year-ago quarter. Analysts, on average, were looking for revenue of $16.8 billion.

Revenue from the Direct-to-Consumer segment jumped 57 percent to $4.3 billion. Moreover, Disney+ subscribers in the quarter rose to 116 million, ahead of the consensus forecast of 114.5 million.

Discussing Q3 results, CEO Bob Chapek said, “We ended the third quarter in a strong position, and are pleased with the Company’s trajectory as we grow our businesses amidst the ongoing challenges of the pandemic. We continue to introduce exciting new experiences at our parks and resorts worldwide, along with new guest-centric services, and our direct-to-consumer business is performing very well, with a total of nearly 174 million subscriptions across Disney+, ESPN+ and Hulu at the end of the quarter, and a host of new content coming to the platforms.”

In the Q2 2021 investor letter of RiverPark Funds, the fund mentioned The Walt Disney Company (NYSE: DIS). Here is what the fund said:

“DIS shares declined for the quarter, taking a pause after a big fourth quarter and first quarter stock price advance, as Disney+ subscriber numbers were disappointing to investors. Disney+, the company’s DTC streaming business, had blown past previous subscriber projections, having gone from zero to 104 million in 17 months, but investors were now expecting 109 million subscribers. Management still expects significant continued growth to 230-260 million subscribers in 2024.

DIS is blessed with a deep library of unique content that includes both live sports (providing large, non-time shifted audiences) and incomparable brands including Disney, Marvel, Pixar and Lucasfilm, as well as the ABC network. The company also has a wealth of upcoming new content, expecting over 100 original titles per year, including two new Star Wars spin-off series, 10 Star Wars films, 10 Marvel films, 15 Disney and Pixar films and 15 Disney and Pixar series…” (Click here to see the full text)

You can also take a  peek at the 10 Best Dividend Champions to Buy Now and 15 Most Valuable Weed Companies in the World.

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